The district court sanctioned lawyers for filing certain lawsuit in state court, lawsuits that were later removed to federal court.
Rule 11 has long been held to allow sanctions only for actions that take place in federal court, not state court filings that are part of cases that are removed to the federal court.
The court explained:
“We nevertheless hold that the district court abused its discretion when it affirmed the magistrate judge’s sanctions pursuant to Federal Rule 11. Our decision in Tompkinsestablished that “the federal rules do not apply to filings in state court, even if the case is later removed to federal court.” Id. Instead, state pleading rules apply to cases that are initially filed in state court and later removed to federal court. Id. Thus, the district court abused its discretion by applying an erroneous view of the law when it affirmed the magistrate judge’s imposition of sanctions pursuant to Federal Rule 11.
Specifically, the magistrate judge imposed a $5,000.00 sanction under Federal Rule 11because the appellants’ counsel “needlessly increas[ed] the cost of litigation” by filing multiple lawsuits in state court. Doss, 2010 WL 3021533, at *2. The district court affirmed this penalty but reversed the date upon which the $5,000.00 payment would be due to the court.Doss, 2010 WL 3950578, at *3.
We reverse and remand the district court’s affirmance because Mississippi Rule 11 does not contain the same breadth as Federal Rule 11.”
The Fifth Circuit reversed the grant of sanctions and sent the case back to the district court for consideration of whether or not the attorneys violated the Mississippi state rules in filing the state court complaints.
Edward X. Clinton, Jr.