Holden v. Simpson Paper Co ( 2002 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_______________
m 01-20914
Summary Calendar
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NELDA HOLDEN; ET AL.,
Plaintiffs,
NELDA HOLDEN,
Plaintiff-Appellant,
VERSUS
SIMPSON PAPER COMPANY; ET AL.,
Defendants,
SIMPSON PASADENA PAPER COMPANY; PASADENA PAPER COMPANY, L.P.,
Defendants-Appellees,
_________________________
Appeal from the United States District Court
for the Southern District of Texas
m H-00-CV-1363
m H-00-CV-2100
_________________________
September 18, 2002
Before JONES, SMITH, and counsel, Harold Dutton, to attempt recovery
EMILIO M. GARZA, Circuit Judges. of the costs. By the end of 2000, however,
neither Holden nor her attorney had contacted
JERRY E. SMITH, Circuit Judge:* Simpson about paying the debt or otherwise
complying with the order.
Nelda Holden sued Simpson Paper Com-
pany (“Simpson”) for unlawful discharge. In In January 2001, Simpson filed a motion
this litigation, she repeatedly refused to com- notifying the district court of Holden’s non-
ply with the district court’s orders to pay costs compliance, explaining its attempts to contact
assessed against her in a 1995 lawsuit against her attorney. That month, the court issued its
Simpson. After Holden disobeyed its second second order directing Holden to negotiate a
order to compel costs, the court dismissed her payment plan with Simpson for the costs im-
new suit with prejudice for failure to comply posed in the first suit. When Holden explained
with orders, enjoined her from filing any other that she could not afford to pay, Simpson
suits in the Southern District of Texas without offered to permit her to pay the debt in
court approval, and fined her an additional monthly, interest-free installments of $114 and
$1,000. Concluding that Holden’s deliberate prepared a promissory note to that effect.
disobedience of multiple court orders brought Holden made only two payments of $114 and
these sanctions within the district court’s dis- refused to sign the promissory note.
cretion, we affirm.
In July 2001, Simpson filed another notice
I. of Holden’s non-compliance and suggested the
In October 1995, Holden sued Simpson for imposition of further sanctions, whereupon the
unlawful discrimination. Holden v. Simpson court ordered her to appear to explain her
Pasadena Paper Co., No. H-95-4989. In May noncompliance. The court promptly held a
1997, the court granted Simpson’s motion for hearing and concluded that Holden had no rea-
summary judgment and entered a final order of sonable basis for refusing to pay. Although
dismissal. The next month, the court assessed Holden explained she had been unable to ob-
$3,993.98 in costs, which Holden did not pay. tain work, she also stated that she had used a
lump sum severance payment to pay off the
In April 2000, Holden brought the instant note on her house, and the court concluded
suit against Simpson, Pasadena Paper Com- she had not looked for work diligently.
pany, and various other entities. In August
2000, Simpson informed the court of the out- The court entered three sanctions: (1) It
standing costs, whereupon the court issued an dismissed the instant suit; (2) it entered what
order compelling Holden to pay Simpson “the the parties have styled a preclusion order, bar-
$3,993.98 taxed against her in H-95-4989.” ring Holden from filing another suit in the
Simpson mailed three letters to Holden’s trial Southern District of Texas “without the
court’s written permission in advance”; and (3)
it ordered her to pay an additional $1,000 in
*
Pursuant to 5TH CIR. R. 47.5, the court has sanctions to Simpson Pasadena Paper Com-
determined that this opinion should not be pub- pany. During the hearing, the court described
lished and is not precedent except under the limited the first two orders as “infinitely reviewable,”
circumstances set forth in 5TH CIR. R. 47.5.4.
2
and explained that it would consider vacating sanctions. Long v. Simmons, 77 F.3d 878, 880
those orders if she paid the costs in full. In (5th Cir. 1996).2 A dismissal with prejudice is
January 2002, the court entered an order cer- “an extreme sanction that deprives the litigant
tifying the dismissal and preclusion orders for of the opportunity to pursue his claim.”
appeal under FED. R. CIV. P. 54. Callip, 757 F.3d at 1519 (citation and internal
quotation omitted). We review such a
II. dismissal for abuse of discretion. Long, 77
Holden relies on our cases describing the F.3d at 879.
standards for dismissal under FED. R. CIV. P.
41 for failure to prosecute. Rule 41, however, Simpson met its required burden of proving
also gives courts the power to dismiss for de- that Holden had knowingly and deliberately
liberate and flagrant disobedience of court or- disobeyed the court orders. 3 Holden argues
ders. Such dismissals are presumed to be with
prejudice.1
2
In the line of cases describing dismissals for
To dismiss with prejudice for disobedience, failure to prosecute, we have considered other
the court must find that (1) the plaintiff aggravating factors, such as whether the plaintiff
deliberately or contumaciously refused to or attorney caused the delay, the delay prejudiced
comply with (2) multiple or repeated court the defendant, or the attorney acted intentionally.
orders (3) despite the imposition of lesser Callip v. Harris County Child Welfare Dep’t, 757
F.3d 1513, 1519 (5th Cir. 1985). It is uncertain
whether these same aggravating factors apply to a
dismissal for a party’s refusal to obey court orders.
1
Rule 41(b) provides: We do not need to reach the question, because the
boilerplate test adequately measures many of these
For failure of the plaintiff to prosecute factors and justifies the dismissal.
or to comply with these rules or any order of
3
court, a defendant may move for dismissal Connolly v. Papachristid Shipping, Ltd., 504
of an action or of any claim against the F.2d 917, 920 (5th Cir. 1974) (reversing rule 41(b)
defendant. Unless the court in its order for dismissal because noncompliance appeared
dismissal otherwise specifies, a dismissal inadvertent rather than deliberate); Council of Fed-
under this subdivision and any dismissal not erated Org. v. Mize, 339 F.2d 898, 900 (5th Cir.
provided for in this rule, other than a 1964) (reversing because “it must be inferred from
dismissal for lack of jurisdiction, for the record that counsel for the plaintiffs
improper venue, or for failure to join a party misunderstood the district court’s order . . . and
under Rule 19, operates as an adjudication their absence was not willful or in bad faith”);
on the merits. 8 JAMES WM. MORE ET AL., MOORE’S FEDERAL
PRACTICE § 41.53, at 203-04 (3d ed. 2002)
FED. R. CIV. P. 41(b). Although the text of rule (“[T]he district court need only find that a party
41(b) suggests the defendant needs to move for acted deliberately rather than accidently, and need
dismissal, district courts have the inherent power to not find bad faith.”). See Bonaventure v. Butler,
raise the possibility of dismissal sua sponte. Link 593 F.2d 625, 626 (5th Cir. 1979) (interpreting
v. Wabash R.R., 370 U.S. 626, 630-31 (1962) FED. R. CIV. P. 37(b) to permit dismissal where
(failure to prosecute); Martinez v. Johnson, 104 party repeatedly and deliberately refused to appear
F.3d 769, 772 (5th Cir. 1997) (disobeying court for deposition); Durgin v. Graham, 372 F.2d 130,
order). (continued...)
3
that because we have most commonly upheld buzzwords “bad faith” and “wilfulness,” which
involuntary dismissals for unjustified delays have no meaning in a vacuum.
and excessive, frivolous, and abusive litigation,
those are t he exclusive grounds for proving The district court had little difficulty
wilfulness or bad faith under rule 41(b). Most concluding that Holden had deliberately
of those cases, however, considered dismissals disobeyed the order. After June 1997, the
for failure to prosecute.4 order imposing costs should have placed
Holden on notice. Simpson’s subsequent and
Rule 41(b) makes ignoring a court rule or repeated attempts to contact her went ignored.
order a separate ground for involuntary dis- By the time of the sanctions hearing, the court
missal. And it is difficult to imagine how a had twice ordered her to pay the outstanding
plaintiff can disobey a court order more costs.
willfully or in worse faith than when she has At the sanctions hearing, Holden never
knowledge of the order and deliberately even tried to argue that she misunderstood her
disobeys it. Holden fails to articulate a legal obligations in 1997. Despite
coherent, competing standard that would understanding those obligations, she failed to
validate her conduct,5 but merely invokes the satisfy them over a period of four years. The
record evidence overwhelmingly demonstrates
her deliberateness.
3
(...continued)
131 (5th Cir. 1967) (same). To support its dismissal, the district court
4
pointed to a series of court orders that Holden
In this portion of her brief, Holden cites cases had ignored for over four years. The district
with only tangential relevance. E.g., Smith v. Legg
court cannot dismiss for a plaintiff’s isolated
(In re United Markets Intn’l, Inc.), 24 F.3d 650,
failure to comply with a single order; minor
654 (5th Cir. 1994) (affirming sanction of over
$60,000 based on frivolous claims and appeals); infractions are not enough.6 We have affirmed
Natural Gas Pipeline Co. v. Energy Gathering,
Inc., 2 F.3d 1397, 1411-12 (5th Cir. 1993) (finding
5
that attorney acted in bad faith by deliberately (...continued)
disobeying court orders, but vacating sanction advertence. District courts may use a dismissal
compelling him to turn over personal tax records with prejudice to punish an attorney’s negligence
because it lacked relation to his misconduct and only in “extreme and unusual circumstances.”
intruded on his personal privacy); EEOC v. Gen. Hassenflu v. Pyke, 491 F.2d 1094, 1095 (5th Cir.
Dynamics Corp., 999 F.2d 113, 119 (5th Cir. 1974).
1993) (reversing sanctions for failure to comply
6
with discovery orders because district court did not E.g., Neal v. IAM Local Lodge 2386, 722
find that attorney had acted deliberately or F.2d 247, 249 (5th Cir. 1984) (reversing dismissal
wilfully); Gelabert v. Lynaugh, 894 F.2d 746, for missing “one of these deadlines by a few
747-48 (5th Cir. 1990) (affirming dismissal of days”), overruled on other grounds, Baldwin
claim for frivolous and abusive litigation). County Welcome Ctr. v. Brown, 466 U.S. 147,
149-50 (1984); Houston Citizens Bank & Trust
5
Holden does not argue that the failure to pay Co. v. Dolleslager (In re Dolleslager), 618 F.2d
was her attorney’s fault. We usually do not pun- 322, 326 (5th Cir. 1980) (reversing dismissal for
ish parties for counsel’s mere negligence or in- failure to obey single pretrial order requiring
(continued...) (continued...)
4
dismissals, however, where the plaintiffs have A district court must at least consider and
failed either to comply with a series of court reject less drastic measures. Hornbuckle v.
orders7 or comply with a single court order Arco Oil & Gas Co., 732 F.2d 1233, 1237
despite many opportunities to do so.8 (5th Cir. 1984). In most cases, the court
should attempt to use less severe sanctions
The instant case falls squarely into the latter before resorting to involuntary dismissal.
category. Holden disobeyed at least three Gonzalez v. Trinity Marine Group, Inc., 117
orders to pay the costs over a period of four F.3d 894, 898 (5th Cir. 1997); McNeal v. B.H.
years. Her disobedience was grave enough to Papasan, 842 F.2d 787, 793 (5th Cir. 1988).
warrant dismissal with prejudice. If those measures would be ineffective,
however, the court may involuntarily dismiss
with prejudice.9
6
(...continued) Here, the court settled on dismissal as the
amendment of complaint); Wrenn v. Am. Cast Iron only sanction likely to be effective. In doing
Pipe Co., 575 F.2d 544, 546 (5th Cir. 1978) so, the court exercised sufficient patience.
(finding that failure to pay partial filing fee despite Holden’s refusal to pay costs from the first suit
otherwise diligent prosecution should not justify limited the disciplinary options; the court
dismissal), overruled on other grounds, Baldwin reasonably expected that Holden would simply
County Welcome Ctr., 466 U.S. at 149-50. ignore monetary fines. The court gave her
7
several opportunities to comply. In all, the
E.g., Dorsey v. Scott Wetzel Servs., Inc., 84 two district courts gave Holden three
F.3d 170, 172 (5th Cir. 1996) (affirming dismissal opportunities to comply with the initial
for failure to file joint pretrial order, failure to ap-
assessment of costs.
pear at docket call, failure to be set for trial, and
tardily designating expert); Berry v. CIGNA/RSI-
CIGNA, 975 F.2d 1188, 1192 n.6 (5th Cir. 1992) When Holden failed to pay those costs, the
(“[W]here a plaintiff has failed to comply with court was not limited to dismissing without
several court orders or court rules, we have held prejudice. Warnings give the district court la-
that the district court did not abuse its discretion titude to dismiss with prejudice, Callip, 757
. . . .”) (collecting cases). F.2d at 1521-22, and doing so was well within
the court’s discretion.
8
E.g., Larson v. Scott, 157 F.3d 1030, 1032
(5th Cir. 1998) (affirming dismissal with prejudice In at least three cases, we have considered
where prisoner plaintiff ignored order to file involuntarily dismissals based on failure to pay
statement of trust account and ignored subsequent
warning that failure to comply would result in dis-
missal); Martin-Trigona v. Morris, 627 F.2d 680,
9
682 (5th Cir. 1980) (affirming dismissal where Sturgeon v. Airborne Freight Corp., 778 F.2d
plaintiff failed to respond to motion to dismiss over 1154 (5th Cir. 1985) (“When lesser sanctions have
a period of thirteen months despite three orders to proved futile, a district court may properly dismiss
do so); Hulsey v. Texas, 929 F.2d 168, 171 (5th a suit with prejudice.”) (citation and quotations
Cir. 1991) (finding that district court properly omitted); Callip, 757 F.2d at 1521 (explaining that
dismissed complaint for failure to comply with providing the plaintiff with second and third chanc-
service order because court gave instructions and es to comply with order counts as a lesser
opportunity to correct faulty service). sanction).
5
costs assessed in an earlier case. In Duchardt Without more lenient sanctions and an
v. Ewing, 571 F.2d 869, 870-71 (5th Cir. opportunity to respond, the plaintiff never had
1978), we reversed an automatic, involuntary the opportunity to explain that the first court
dismissal where the plaintiff had attempted to assessed costs only because of his procedural
challenge the costs in the first case but used error. The dismissing court, therefore, could
the wrong procedural vehicle. We classified never consider the severity of the plaintiff’s
the dismissal sanction as too harsh where the disobedience in the context of the first court’s
plaintiff did not have an opportunity to substantive reasons for shifting costs.
articulate his reasons for defeating cost
recovery. Id. In Gelabert, 894 F.2d at 748, By contrast, in this case the dismissing
however, we affirmed an involuntary dismissal court displayed great patience and considered
with prejudice where an overly litigious Holden’s arguments against dismissal. The
plaintiff had failed to pay a $10 fine from an court not only issued a new order compelling
earlier case. In Balawajder v. Scott, 160 F.3d payment, but, when Holden failed to comply
1066, 1067 (5th Cir. 1999), we affirmed an with that order, the dismissing court issued a
involuntary dismissal without prejudice for the second order. Only after Holden failed to
plaintiff’s failure to comply with other courts’ comply with that second order did the court
sanctions orders. Emphasizing the plaintiff’s order a hearing to consider further sanctions.
history of frivolous litigation, we noted that
one court could validly enforce other courts’ At that hearing, Holden argued only that
orders with the sanction of involuntary she did not have the ability to pay. She
dismissal. Id. at 1067-68. Neither Gelabert admitted, however, that she had received a
nor Balawajder cites or considers Duchardt. severance payment after the assessment of
costs and used the money to pay off her house
We interpret Duchardt as limited to cases note. She also admitted that she had refused
in which the plaintiff asserts that the first court to negotiate a reasonable regular payment plan
shifted costs only because the plaintiff had with Simpson despite their repeated attempts
made a procedural error and the second court to contact her.
did not give the plaintiff an opportunity to ex-
plain or comply before dismissal. In Duchardt, The court certainly could have concluded
although we did not spell out the insufficiency, that Holden had the money to pay the costs
the district court violated one of our traditional and that she had no valid objection to the ori-
requirements for a rule 41(b) dismissal. As ginal order. Because Holden received
early as 1976, we had vacated a decision for adequate notice and an opportunity to explain,
failing to consider thoroughly less severe this case differs fundamentally from Duchardt.
sanctions. Boazman v. Economics Lab., Inc., Instead, we rely on our general caselaw
537 F.2d 210, 213-14 (5th Cir. 1976). governing rule 41(b) dismissals, Gelabart, and
Balawajder. All of these sources point toward
In Duchardt, the district court affirming the involuntary dismissal.
automatically dismissed without considering
lesser sanctions or warning the plaintiff. We III.
imposed this requirement to avoid precisely The district court also imposed a $1,000
the risk we described as acute in Duchardt. sanction. At the hearing, the court appeared
6
to base its sanction on the costs generated by Deliberately disobeying court orders dem-
Holden’s refusal to pay the original costs as- onstrates sufficient bad faith to justify a district
sessed in 1997. Because Holden did not vol- court’s sanction under its inherent powers. In
untarily dismiss her 1995 suit, rule 41(d) did Toon, 250 F.3d at 953-54, we affirmed a
not authorize the sanction.10 We have held, $15,000 sanction where an attorney had ig-
however, that district courts have the inherent nored an order to file a motion under seal. In
power to sanction litigants for abusive Natural Gas Pipeline, 2 F.3d at 1409-11, we
conduct.11 We review the exercise of those labeled an attorney’s bald refusal to comply
inherent powers for abuse of discretion. with three court orders to turn over documents
Natural Gas Pipeline Co. of Am. v. Energy as “bad faith.” The repeated refusal to comply
Gathering, Inc., 86 F.3d 464, 467 (5th Cir. with court orders demonstrates “bad faith” and
1996). amply supports the sanctions awarded in this
case.
Holden essentially repeats the argument she
made for reversing the dismissalSSbad faith is Finally, Holden argues that she does not
required, and she did not act in bad faith. have the money, and the district court should
Once again, she cites cases involving frivolous have been sensitive to her in forma pauperis
or repetitive litigation and assumes that is the status. A litigant’s poverty should not make
only example of litigants abusing the litigation him immune to the courts’ discipline.
procedure in bad faith. She is wrong. Monetary fines mean less to insolvent defen-
dants, making them less effective for deterring
abuse of the judicial system. In re Sindram,
10
498 U.S. 177, 179-80 (1991) (explaining
Rule 41(d) shifts costs for lawsuits dismissed diminished deterrent effect on pro se
by the plaintiff and later recommenced:
prisoners). We will not limit the scope of
courts’ inherent powers over these defendants
If a plaintiff who has once dismissed an
action in any court commences an action in a way that will exacerbate the problem.
based upon or including the same claim
against the same defendant, the court may For those reasons, we have previously held
make such order for the payment of costs of that a litigant’s in forma pauperis status does
the action previously dismissed as it may not automatically shield him from sanctions for
deem proper and may stay the proceedings abusing the litigation process. In re United
in the action until the plaintiff has complied Markets Int’l, 24 F.3d at 855-56; Gelabert,
with the order. 894 F.2d at 748. The Supreme Court has sim-
ilarly interpreted the in forma pauperis statute
FED. R. CIV. P. 41(d). not to include waiver of filing fees for
11 frivolous or abusive suits.12
Toon v. Wackenhut Corrections Corp., 250
F.3d 950, 952 (5th Cir. 2001) (“When a party’s
deplorable conduct is not effectively sanctionable
12
pursuant to an existing rule or statute, it is E.g., Demos v. United States District Court
appropriate for a district court to rely on its (In re Demos), 500 U.S. 16, 17 (1991) (“Petitioner
inherent powers to impose sanctions.”) (citation has abused the system, and we find it appropriate
and quotations omitted); Natural Gas Pipeline, 2 to deny leave to proceed in forma pauperis to
F.3d at 1407 (same). (continued...)
7
Holden has not presented record evidence
that her impoverished status should justify
reversing the sanctions for her admitted
misbehavior. The district court’s orders
reflected that she only needed to begin paying
the costs. Simpson attempted to arrange a
monthly, interest free payment plan. Holden
refused to sign a promissory note
memorializing the payment plan and stopped
making payments without notice or
explanation.
In the face of these accommodations, Hol-
den at least had an obligation to bring her fi-
nancial circumstances to the attention of either
Simpson or the court and negotiate a new pay-
ment plan. She did not do so, and the court
had the discretion to sanction her harshly for
her pattern of contumacious conduct.
AFFIRMED.
12
(...continued)
petitioner in these two petitions for extraordinary
relief . . . and in all future petitions for
extraordinary relief.”); In re McDonald, 489 U.S.
180, 184 (1989) (suspending in forma pauperis
status for all future writ applications because of
past abuses).
8