Defendant Waited Too Long To File Rule 11 Motion


This case discusses a Rule 11 issue in the context of Bankruptcy Rule 9011. Plaintiff brought an adversary action against Discover Bank and its lawyer, Stephen Bruce, alleging that they violated the automatic stay by maintaining a garnishment over certain funds. The Defendants moved to dismiss the complaint, but their motion was denied. They then answered and served discovery requests. Eventually, the Defendants obtained summary judgment. At the conclusion of the case the Defendants moved for sanctions under Rule 9011. The court’s explanation:

The Sanction Motion was filed by Bruce on August 11, 2017, eighteen-and-a-half (18 ½) months after the filing of the Complaint, seventeen (17) months after the first safe harbor letter, sixteen (16) months after filing the Motion to Dismiss, nine (9) months after the second safe Harbor letter and the filing of the Motion for Summary Judgment and four-and-a-half (4 ½) months after the entry of the judgment in Bruce’s favor. If Bruce truly believed that the Law Firm’s conduct was so abusive and vexatious to warrant service of the safe harbor letters, and this Court has no reason to believe that Bruce wasn’t sincere in that belief, he should have pursued that motion by filing it shortly after the expiration of the twenty-one (21) day safe harbor in either February and/or November 2016. Instead, Bruce elected to wait and spend additional time and money in the discovery process and summary judgment process. The Court doesn’t know the reason for the delay, and the pleadings and oral argument did not enlighten the Court. It may have been because Bruce felt confident of the outcome and wanted to establish a precedent rather than cutting the litigation off at an early stage. “Suffice it to say that [Discover and Bruce] would be better served by reexamining their own litigation tactics rather than condemning plaintiff’s counsel for her litigation tactics.” Thompson v. United Transportation Union, 167 F.Supp.2d at 1260. The Court finds that Bruce’s Motion was not timely filed and can be denied on that basis alone, so is not necessary for the Court to decide the sanction motion on its merits. Accordingly,

IT IS ORDERED that Defendant Stephen L. Bruce Esq.’s Motion for Sanctions [Doc 90] is hereby DENIED.

In Re Waldrop

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