Prompt Remedial Action Avoids Rule 11 Sanctions


Here, plaintiff tendered a Rule 11 safe harbor notice, giving the defendant 21 days to remedy the alleged violation. The defendant did its research and amended the complaint promptly, avoiding sanctions. The court explains:

“Plaintiff’s motions additionally seek Rule 11 sanctions against the attorneys representing ORNTIC and BONY on the grounds that their submissions have been fraudulent and/or frivolous because they misrepresented the existence of BONY and ORDMS and because the attorneys have no legal services agreements with BONYMCorp or ORNTIC. BONY’s counsel maintains that BONY is the proper defendant in this case and argues that Plaintiff has failed to prove otherwise. In support, BONY notes that the Clerk of the Court has declined to grant default against BONY on two occasions. See ECF 64, 123. Having reviewed the record, the Court agrees with BONY’s counsel that Plaintiff has failed to establish that BONY is the improper party. See BONY’s RJN Exh. C (SOT listing BONY as the assignee of Plaintiff’s DOT). Accordingly, the Court DENIES Plaintiff’s motion for sanctions against BONY’s counsel.

As for ORNTIC, its counsel explains that, after receiving Plaintiff’s Safe Harbor Notice for her Rule 11 motion, counsel contacted ORDMS who then researched the issue and concluded that ORNTIC is in fact the proper party defendant in this case. Upon learning this, counsel immediately filed a Notice of Errata to advise the Court of the error and filed a “corrective” Motion to Dismiss the SAC. ORNTIC’s counsel argues that this remedied any offensive pleading within the time allotted in Plaintiff’s Safe Harbor Notice and the Court agrees. Accordingly, Plaintiff’s motion for sanctions against ORNTIC’s counsel is DENIED.”

Source: Cox v. OLD REPUBLIC NATIONAL TITLE INSURANCE COMPANY, Dist. Court, ND California 2016 – Google Scholar

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