Month: December 2012

Seventh Circuit Rejects Requirement That Inmate Post Bond Before Litigating

Gay v. Chandra, 682 F. 3d 590 – Court of Appeals, 7th Circuit 2012 – Google Scholar.

A prison inmate sued his psychiatrist. Because he had filed more than 30 lawsuits since 1996, the District Court required him to post a bond of $1,000 to continue with the lawsuit. The district court reasoned that the bond would cover some of defendants’ costs in litigating with the inmate.

The Seventh Circuit reversed on the ground that the court failed to consider whether the inmate was indigent before imposing the bond. The bond requirement was an abuse of discretion because the district court knew that the inmate could not pay it. The bond requirement served only to dismiss the lawsuit. The Seventh Circuit discussed other tools that courts can use to deter frivolous litigation.

Third Circuit Weighs In On Cost Awards For Electronic Discovery

Race Tires America v. Hoosier Racing Tire Corp., 674 F. 3d 158 – Court of Appeals, 3rd Circuit 2012 – Google Scholar.

The 3rd Circuit Court of Appeals decided a case sure to interest many litigators. In litigation these days, everyone wants electronic discovery but no one wants to pay for it. The costs of digging up old emails and finding old documents can be enormous.

Here, the 3rd Circuit dealt with one major issue: who pays for all those consultants when the litigation is over?

The Court frames the issue in this way:

“At issue in this appeal is whether all charges imposed by electronic discovery vendors to assist in the collection, processing, and production of electronically stored information (“ESI”) are taxable against a losing party as “[f]ees for exemplification [or] the costs of making copies of any materials where the copies are necessarily obtained for use in the case.” 28 U.S.C. ยง 1920(4).”

The district court had awarded $365,000 in electronic discovery costs. The 3rd Circuit reversed the award and concluded that only costs related to scanning and file format conversion could be recovered because those activities constituted “making copies.”

The 3rd Circuit disallowed the remainder of the awarded costs in excess of $300,000 on the ground that the other costs did not relate to file conversion or scanning.

This is an enormous issue in litigation. This opinion, which discusses the issue, is well worth reading.

Plaintiff’s Failure to Cooperate In Discovery Results In Dismissal of Employment Case

KUANG v. GENZYME GENETICS CORPORATION, Dist. Court, SD New York 2012 – Google Scholar.

This case alleges race and age discrimination. It was dismissed pursuant to Rule 37 of the Federal Rules of Civil Procedure as a sanction for the failure to cooperate in discovery. Plaintiff’s counsel also misrepresented facts in communications to the Court and refused to allow his client to be deposed. The deposition began and was halted by plaintiff’s counsel after 3 hours. It was never finished even after the court ordered the deposition to proceed for an additional 5 hours.

The court found that the misconduct was designed to obtain a tactical advantage. The Court explained:

“The Court concludes that Plaintiff and her counsel have sought a tactical advantage by repeatedly attempting to protect Ms. Kuang from her obligation to allow her adversary to depose her. Plaintiff’s counsel refused to schedule times in good faith to complete Plaintiff’s deposition. (See Section “ILD” above). Plaintiff’s counsel claimed that his client was too ill to continue to be deposed, but presented the Court and his adversary inadequate records to demonstrate so much. (Docket # 44). Plaintiff’s counsel’s failure to notify his adversary and the Court whether Plaintiff would be available for a deposition on the week of September 4, 2012, and unrealistic offer on September 5, 2012, to make his client available less than 48 hours later without any prior notice, all suggest a course of conduct designed to prevent Ms. Kuang from having to be subjected to a complete deposition.”

Bankruptcy Court Sanctions Lawyers For Mischaracterizing Binding Precedent

IN THE MATTER OF WITT, Bankr. Court, ND Indiana 2012 – Google Scholar.

This is a bankruptcy case. The judge sanctioned the lawyers for one of the parties because they made frivolous arguments and misstated applicable law and precedent. Lawyers frequently cite cases for propositions that do not exist in those cases or use citations and quotes out of context. This case is rare because the court sanctioned the lawyers for mischaracterizing precedent.

The court explained:

“Neither courts nor litigants are free to ignore the holdings of the Supreme Court. U.S. v. Leahy, 438 F.3d 328, 332 (3rd Cir. 2006). Yet, that is exactly what counsel did. Admittedly, they referred to Schwab but then, rather than acknowledging its force, they distorted it beyond recognition. They never once acknowledged the Court’s holding, even though the decision used the words “we hold . . .” which should have dispelled any doubt over its meaning, and that holding was directly contrary to the arguments they advanced. “[W]hen counsel engages in this type of deliberate mischaracterization of precedent, sanctions are warranted.” Teamsters Local No. 579 v B & M Transit, Inc., 882 F. 2d 274, 280 (7th Cir. 1989).


The deliberate mischaracterization of precedent is sanctionable. Teamsters Local No. 579, 882 F.2d at 280; Multi-Media Distributing, 836 F. Supp. at 614 n.7. Words must be read in context; not in isolation, divorced from the context in which they appear. It is the context in which statements are made that gives them their accurate meaning. A particular statement can be misrepresented just as completely by quoting it out of context, even though the quoted statement is accurately reproduced, as by lying about what was said. That is what counsel did here. They accurately quoted a single sentence from an appellate decision, but took it so completely out of the context in which it was made as to make black seem white. That is not only inexcusable, it is sanctionable. See, Multi-Media Distributing, 836 F. Supp. at 613-14 n.7.”