Case: 11-14703 Date Filed: 12/03/2012 Page: 1 of 4
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
No. 11-14703
D. C. Docket No. 0:07-cv-61542-UU
JOSEPH C. HUBBARD,
individually and on behalf of all others
similarly situated, et al.,
Plaintiffs,
LABATON SUCHAROW LLP,
KESSLER TOPAZ MELTZER & CHECK LLP,
Interested Party-Appellees-
Cross-Appellants,
versus
BANKATLANTIC BANCORP, INC.,
JAMES A. WHITE,
VALERIE C. TOALSON,
JARETT S. LEVAN,
ALAN B. LEVAN,
JOHN E. ABDO,
Defendants-Appellants-
Cross-Appellees.
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Appeals from the United States District Court
for the Southern District of Florida
(December 3, 2012)
Before DUBINA, Chief Judge, PRYOR and HILL, Circuit Judges.
PER CURIAM:
This is a security fraud class action filed by Appellees State-Boston (Lead
Plaintiff) and other class members (collectively “Appellees/Cross-Appellants” or
“State-Boston”) against Appellants BankAtlantic Bancorp, Inc. and five senior
officers and/or chairmen of the company, James White, Valerie Toalson, Jarett
Levan, Alan Levan, and John Abdo (collectively “Appellants” or “Bancorp”).
After granting judgment as a matter of law in favor of Appellants,1 the district
court granted in part and denied in part Appellants’ motion for Rule 11 sanctions
as to allegations and claims contained in Appellees’ complaint and amended
complaint. Appellants challenge the denial of sanctions as to certain claims, and
Appellees cross appeal the grant of sanctions as to the remaining claim.
The issues on appeal are:
1
This judgment was affirmed by the Eleventh Circuit on July 23, 2012. See Hubbard v.
BankAtlantic Bancorp, Inc.,
688 F.3d 713 (11th Cir. 2012).
2
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1. Whether the district court abused its discretion in denying Bancorp’s
motion for Rule 11 sanctions as to State-Boston’s confidential witness allegations?
2. Whether the district court abused its discretion in denying Bancorp’s
motion for sanctions as to State-Boston’s claims of insider trading, accounting
fraud, and manipulated loan loss reserves?
3. Whether the district court abused its discretion in denying Bancorp’s
motion for sanctions as to State-Boston’s claim of damages caused by securities
fraud where State-Boston’s expert, Candace Preston, did not attempt to
disaggregate the effect of other negative non-fraudulent information from the
stock price decline on October 26, 2007?
The issue presented on the cross-appeal is:
1. Whether the district court abused its discretion in granting Bancorp’s
motion for sanctions as to allegations made by State-Boston’s third confidential
witness, Donna Loverin?
“We review a district court’s Rule 11 determinations for an abuse of
discretion.” CNA Fin. Corp. v. Brown,
162 F.3d 1334, 1338 (11th Cir. 1998). “A
district court would necessarily abuse its discretion if it based its ruling on an
erroneous view of the law or on a clearly erroneous assessment of the evidence.”
3
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Cooter & Gell v. Hartmarx Corp.,
496 U.S. 384, 405,
110 S. Ct. 2447, 2461,
110
L. Ed. 2d 359 (1990).
After reviewing the record, reading the parties’ briefs, and having the
benefit of oral argument, we first conclude that the district court did not abuse its
discretion when it rejected sanctions on all grounds raised by Bancorp’s appeal.
We conclude that Bancorp did not meet the high burden of showing that the
district court abused its discretion in finding that the allegations attributed to the
confidential witnesses were not sanctionable, that State-Boston’s claims for
insider trading, accounting fraud, and loss reserves were not sanctionable, and that
State-Boston’s claims for damages were not sanctionable. Likewise, on the cross-
appeal, we conclude from the record that State-Boston did not meet the high
burden of showing that the district court abused its discretion in finding that the
allegations related to CW3 Loverin were sanctionable.
In conclusion, because we find no merit to any of the arguments made on
the appeal or cross-appeal, we affirm the district court’s judgment in all respects.
AFFIRMED.
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