Rahul K. Nath, M.D. v. Baylor College of Medicine ( 2012 )

Opinion of May 3, 2012 Withdrawn, Motion for Rehearing Overruled, Affirmed
and Substitute Opinion filed June 26, 2012.
In The
Fourteenth Court of Appeals
NO. 14-11-00034-CV
RAHUL K. NATH, M.D., Appellant
V.
TEXAS CHILDREN’S HOSPITAL, Appellee
On Appeal from the 215th District Court
Harris County, Texas
Trial Court Cause No. 2006-10826
NO. 14-11-00127-CV
RAHUL K. NATH, M.D., Appellant
V.
BAYLOR COLLEGE OF MEDICINE, Appellee
On Appeal from the 215th District Court
Harris County, Texas
Trial Court Cause No. 2006-10826A
SUBSTITUTE OPINION
We overrule the motion for rehearing filed by Rahul K. Nath, M.D. in these cases.
We withdraw our opinion issued May 13, 2012, and we issue the following substitute
opinion in its place.
These are consolidated appeals of two judgments awarding appellees Texas
Children‘s Hospital (―TCH‖) and Baylor College of Medicine (―Baylor‖) attorney‘s fees
as sanctions. Appellant Rahul K. Nath, M.D. challenges the sanctions awards on several
grounds. In both cases, Nath asserts that the trial court abused its discretion in granting
the sanctions because (a) the sanctionable conduct was that of Nath‘s attorneys, rather
than Nath; (b) the motions for sanctions were filed after the trial of the case; (c) the
procedural safeguards of Chapter 41 of the Texas Civil Practice and Remedies Code were
not provided; and (d) the sanctions were excessive under the circumstances. In the Baylor
appeal only, Nath brings two additional issues: (1) the trial court abused its discretion in
awarding Baylor its attorney‘s fees as sanctions because Texas Rule of Civil Procedure
13 and Texas Civil Practice and Remedies Code Chapter 10 are unconstitutionally vague;
and (2) the award of $644,500.16 in sanctions to Baylor violates the Excessive Fines
clauses of the federal and state constitutions. We affirm.
BACKGROUND
Nath is a board-certified plastic surgeon specializing in surgical treatment of
brachial plexus injuries, which are injuries to the nerves of children occurring during
birth. In February 2006, Nath sued Baylor and TCH (under vicarious liability theories),
and Dr. Saleh Shenaq for tortious interference with prospective business relations and
defamation based on statements allegedly made by Shenaq. These allegedly defamatory
statements asserted that Nath (a) was fired from Baylor, (b) performed unnecessary
surgeries, (c) was unqualified, (d) was under criminal investigation, and (e) lacked
professional ethics and integrity. Nath amended his petition in April 2006, adding two
out-of-state defendants, reasserting the same allegations.
2
He again amended his petition in August 2006 after the out-of-state defendants
filed special exceptions, providing more details regarding their acts, but keeping the same
claims against all the defendants: defamation and tortious interference. The out-of-state
defendants also filed special appearances, which the trial court denied. However, these
special appearances were reversed on appeal. Nath‘s dispute with Shenaq was resolved
by an agreed order of dismissal with prejudice.
Nath amended his petition again in September 20081 to include claims for tortious
interference, defamation, negligent supervision, and negligent training against Baylor and
TCH only. In this petition, Nath reurged his previous defamation complaints and added
that Shenaq and various other Baylor and TCH employees made false and misleading
statements to the effect that Nath had left TCH without notice and had disappeared from
TCH without leaving a forwarding address.
Nath filed a fourth amended petition in November 2008, alleging the same claims
against the same defendants. In this petition, he made the allegations detailed above, as
well as alleging that further defamatory statements had been made by specific individuals
employed by Baylor or TCH. Nath also detailed several specific examples of alleged
tortious interference. He contended that the basis for the ―defamation campaign‖ pursued
by TCH and Baylor was dissatisfaction of doctors in the Baylor Obstetrics/Gynecology
department concerning Nath‘s testimony in lawsuits filed against them. He additionally
alleged that TCH and Baylor were further motivated to discredit him, damage his
reputation, and remove him from their facilities because Nath had discovered that even
though Shenaq had become partially or completely blind in one eye after suffering a
detached retina in 2003, Shenaq continued to perform surgeries.
In July 2009, Nath filed his fifth amended petition against Baylor and TCH,
adding claims for a declaratory judgment and seeking injunctive relief. His claims for a
declaratory judgment and injunctive relief were based on his allegations that he had
1
The two-year time lag between these petitions is likely due to the appeal of the special
appearances.
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―become increasingly concerned with the question of whether he ha[d] a duty, as a
fiduciary to his current patients, to make any disclosures to them if, in fact, he confirmed
that Dr. Shenaq‘s eyesight [had been] impaired during these surgeries.‖ He further
alleged that Shenaq had some type of hepatitis, which would have been ―an absolute
contraindication to his performing surgery.‖ He stated that when he had sought discovery
of information to reveal when Shenaq contracted hepatitis, what form of hepatitis Shenaq
had, and whether the disease was active, Baylor and TCH had blocked him from
obtaining this information. He sought the following declarations:
Plaintiff seeks this Court‘s declaration of his rights, interests, and duties
with respect to Dr. Nath‘s Current Affected Patients and any other of the
Eyesight Affected Patients and Possible Hepatitis Affected Patients
[operated on by Dr. Shenaq] that are identified to be his current patients.
Plaintiff further seeks this Court‘s declaration of the duties of Baylor and
TCH with respect to the Eyesight Affected Patients and Possible Hepatitis
Affected Patients. Specifically, Plaintiff seeks this Court‘s declaration that
the information sought by Plaintiff in discovery in this lawsuit is
information to which he is entitled and that is necessary for him to
understand and fulfill his duties to his current patients as well as a ruling
from the Court, after the information is fully disclosed, conforming the
extent of disclosure that should be made to his current patients. Plaintiff
further seeks this Court‘s declarations as to Baylor‘s and TCH‘s specific
duties of disclosure to the Eyesight Affected Patients and Possible Hepatitis
Affected Patients as revealed by the discovery and determined by this
Court.
His requested injunctive relief was based on his declaratory judgment claim.
In December 2009, TCH a filed a traditional and no-evidence summary-judgment
motion addressing all of Nath‘s claims. Baylor filed a similar motion on January 4, 2010.
Nath responded to TCH‘s summary-judgment motion in March 2010. An affidavit signed
by Nath was attached as an exhibit to this response. In this affidavit, Nath repeats and
expands upon the factual allegations underlying his fifth amended petition, as well as
identifying several of the legal claims asserted in his petition. On April 1, 2010, when the
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motions for summary judgment were set to be argued, Nath sought recusal of the trial
court judge.2
On April 14, 2010, Nath filed an amended petition in which he abandoned all his
previous claims and substituted a claim for intentional infliction of emotional distress
(―IIED‖). In May 2004, TCH and Baylor supplemented their summary-judgment motions
to address this claim. TCH‘s summary-judgment motion was granted on June 18, 2010,
but its counterclaims remained pending against Nath. Baylor‘s summary-judgment
motion was likewise granted. TCH nonsuited its counterclaims against Nath on August
12, 2010. The trial court signed an order on August 17, 2010, stating that the previously
granted summary judgments became final and appealable on August 12, 2010, the date of
TCH‘s non-suit.
On August 26, 2010, TCH filed a motion to modify the judgment to assess its
attorney‘s fees as sanctions against Nath pursuant to Texas Rule of Civil Procedure 13
(―Rule 13‖) and Chapter 10 of the Texas Civil Practice and Remedies Code (―Chapter
10‖):
[TCH] prays that the Court grant its Motion to Modify the Judgment to
Assess Fees as Sanctions Against Plaintiff Rahul K. Nath and impose
monetary sanctions against Nath under Chapter 10 and/or Rule 13 based on
the filing of the intentional infliction of emotional distress claim; the
defamation, tortious interference, and negligence claims, and the
declaratory judgment claim.
(emphasis added). The trial court heard the motion for sanctions on September 17, 2010.
Without objection by Nath‘s attorney, the trial court took judicial notice of the court‘s
file, including the motions for summary judgment, the attachments to the motions, and
the motion for sanctions with attachments. Nath did not appear or present any evidence at
this hearing, although he was not subpoenaed to attend. That same day, the trial court
granted TCH‘s motion to modify the judgment and assess fees as sanctions against Nath.
The trial court specifically found that Nath‘s claims were groundless, that a reasonable
2
This motion was denied on April 29, 2010.
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inquiry would have revealed that these claims were without factual basis and barred by
well-settled, existing Texas law, and that they were filed in bad faith and for an improper
purpose. The trial court ordered Nath to pay TCH‘s attorney‘s fees in the amount of
$726,000, concluding that this amount adequately punished Nath and fairly compensated
TCH for defending against the claims. On November 8, 2010, the trial court additionally
entered lengthy findings of fact and conclusions of law in support of the sanctions. These
findings and conclusions are attached to this opinion in Appendix A.
On September 10, 2010, the trial court severed Nath‘s proceedings against Baylor
from the main case, in which TCH‘s motion to modify the judgment was still pending.
On September 15, 2010, Nath filed a motion for new trial in the severed Baylor case. On
September 21, 2010, Nath filed a notice of withdrawal of his motion for new trial in the
Baylor case. On October 10, 2010, Baylor filed its own motion to modify the judgment
and to assess fees as sanctions against Nath:
[Baylor] prays that, after hearing, the Court grant its Motion for Sanctions
and Motion to Modify the Judgment to Assess Fees as Sanctions Against
Plaintiff Rahul K. Nath and impose monetary sanctions against Nath under
Chapter 10 and/or Rule 13 based on the filing of the intentional infliction of
emotional distress claim; the defamation, tortious interference, and
negligence claims; and the declaratory judgment claim.
(emphasis added). On November 12, 2010, Nath filed a response to Baylor‘s motion to
modify the judgment, alleging that Baylor‘s motion was untimely, that it was improperly
addressed at Nath rather than his attorneys, and that the evidence supporting the motion
was legally incompetent.
The trial court heard the sanctions motion on November 12, 2010. Over Nath‘s
objection, the trial court took judicial notice of its file. Nath neither appeared nor offered
any evidence at the hearing. On November 19, 2010, the trial court signed its order and
modified judgment in the Baylor case, making the same findings as it did in the TCH
case, discussed above. The trial court ordered Nath to pay Baylor‘s attorney‘s fees in the
amount of $644,500.16, concluding that this amount adequately punished Nath and fairly
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compensated Baylor for defending against the claims. On January 11, 2011, the trial court
signed findings of fact and conclusions of law supporting the sanctions, which are
included in Appendix A to this opinion.
Nath filed motions for new trial in both cases, which were overruled by operation
of law. These appeals timely ensued thereafter.
ANALYSIS
A. Standard of Review and Applicable Law
We review the imposition of sanctions under Chapter 10 of the Texas Civil
Practice and Remedies Code under the same standard we review sanctions under Rule
13—abuse of discretion. See Am. Flood Research, Inc. v. Jones, 192 S.W.3d 581, 583
(Tex. 2006) (per curiam); Cire v. Cummings, 134 S.W.3d 835, 838 (Tex. 2004). When a
trial court imposes Chapter 10 or Rule 13 sanctions, the ruling should be overturned only
when it is arbitrary or unreasonable. Low v. Henry, 221 S.W.3d 609, 614 (Tex. 2007).
―The degree of discretion afforded by the trial court is . . . greater when sanctions are
imposed for groundless pleadings than when imposed for discovery abuse.‖ Falk &
Mayfield L.L.P. v. Molzan, 974 S.W.2d 821, 827 (Tex. App.—Houston [14th Dist.] 1998,
pet. denied).
Chapter 10 provides in pertinent part: ―A court that determines that a person has
signed a pleading or motion in violation of Section 10.001 may impose a sanction on the
person, a party represented by the person, or both.‖ Tex. Civ. Prac. & Rem. Code §
10.004(a). Sanctions under Chapter 10 are authorized if the evidence establishes that a
pleading or motion was brought for an improper purpose. Id. § 10.001(1). Reasonable
inquiry should be made by the party and attorney to ensure that the pleading is not filed
to harass, delay, or increase the cost of the litigation. Id.
Similarly, Rule 13 provides that, if a pleading, motion, or other paper is filed in
violation of the rule, the trial court shall impose an appropriate sanction ―upon the person
who signed it, a represented party, or both.‖ Tex. R. Civ. P. 13. Rule 13 authorizes
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sanctions if the evidence establishes that a pleading is either (1) groundless or brought in
bad faith or (2) groundless and brought to harass. Tex. R. Civ. P. 13. Groundless ―means
no basis in law or fact and not warranted by good faith argument for the extension,
modification, or reversal of existing law.‖ Tex. R. Civ. P. 13.
B. Propriety of Sanctions Against Nath Individually
In his first issue in each appeal, Nath asserts that the sanctions were improper
because they were imposed against him, rather than his attorneys who were responsible
for the pleadings. First, as discussed above, under either Chapter 10 or Rule 13 the trial
court may sanction the person who signed the pleading, a party represented by the person,
or both. Here, the trial court made specific findings and conclusions supporting both
sanctions awards against Nath individually. The trial court concluded as follows
regarding the sanctions awarded to TCH:
In light of Nath‘s bad faith and improper purposes, as set forth herein;
Nath‘s knowledge of the law as a former legal student; Nath‘s prior conduct
as a litigant in numerous cases; the expenses occurred by [TCH] as a result
of the litigation and their reasonable proportion to the amount Nath sought
in damages; the relative culpability of Nath, as set forth above; the minimal
risk of chilling legitimate activity posed by sanctions here; Nath‘s ability to
pay for the damages he has caused [TCH]; the need for compensation to
[TCH] as a result of the damages inflicted upon it in defending against this
lawsuit; the necessity of imposing a substantial sanction to curtail Nath‘s
abuse of the judicial process and punish his bad faith and improper conduct;
the burdens on the court system attributable to Nath‘s misconduct,
including his consumption of extensive judicial time and resources in
prosecuting this case; and the degree to which Nath‘s own behavior caused
the expenses for which [TCH] seeks reimbursement, the Court concludes
that [TCH] should be awarded a substantial portion of its attorney‘s fees to
sanction Nath for his conduct.
A similar legal conclusion was entered in the Baylor case.3
Second, the record contains a lengthy affidavit signed by Nath, in which he repeats
and expands upon the facts and claims asserted in his fifth and sixth amended petitions.
3
As noted above, the trial court‘s findings of fact and conclusions of law in each case are
included in their entirety in Appendix A to this opinion.
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He specifically references his defamation claims and suggests that he may have a duty to
his patients to disclose information regarding Shenaq‘s health, which is what he
attempted to use the Declaratory Judgment Act to discover. The trial court considered this
affidavit in determining that Nath took a personal and participatory role in the litigation.
Nath changed lead attorneys during the pendency of the litigation, another indicator that
he was actively involved in the litigation. Finally, Nath‘s counsel stated that because
Nath was very interested in the depositions of two doctors, his attendance at the
depositions was ―vital‖ to help direct questioning of the deponents, indicating his active
involvement in the litigation.
All of these factors support the trial court‘s conclusion that Nath himself engaged
in the offensive conduct. We are aware that we are not bound by the trial court‘s findings
of fact and conclusions of law. See Am. Flood Research, Inc., 192 S.W.3d at 583 (so
holding in a discovery sanctions case). However, we have reviewed the entire record—
twenty-nine volumes of clerk‘s records in the TCH appeal and three volumes of clerk‘s
records in the Baylor appeal, as well as numerous volumes of reporter‘s records from
various hearings, including the hearings on the motions for sanctions.4 We conclude that
the trial court did not abuse its discretion in finding sufficient evidence that Nath was
personally involved in the litigation and assisted in orchestrating the claims and tactics of
these lawsuits. Cf. Softech Int’l, Inc v. Diversys Learning, Inc., No. 03-07-00687-CV,
2009 WL 638203, at *6–7 (Tex. App.—Austin Mar. 13, 2009, pet. denied) (mem. op.)
(concluding that trial court did not abuse its discretion in assessing sanctions against
party where there was evidence that party engaged in offensive conduct). We overrule his
first issue in each case.
4
Nath, however, asserts that, at best, the evidence that TCH and Baylor set out in their motions
for sanctions equally supports the inference that Nath did, and did not, authorize or ratify the acts or
omissions about which they complain in their motions. But a ―trial court does not abuse its discretion if it
bases its decision on conflicting evidence and some evidence supports its decision.‖ Unifund CCR
Partners v. Villa, 299 S.W.3d 92, 97 (Tex. 2009).
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C. Timing of TCH’s and Baylor’s Motions for Sanctions
In his second issue in each appeal, Nath complains that the sanctions motions were
filed ―too late,‖ i.e., after trial of the case. In support of this assertion, Nath relies on
cases regarding sanctions for discovery abuse. See Remington Arms Co., Inc. v. Caldwell,
850 S.W.2d 167, 170 (Tex. 1993) (orig. proceeding); Finlay v. Olive, 77 S.W.3d 520,
525–26 (Tex. App.—Houston [1st Dist.] 2002, no pet.). However, the Texas Supreme
Court has upheld an award of sanctions under Chapter 10 and Rule 13 based on a motion
for such sanctions filed after entry of a final judgment. Lane Bank Equip. Co. v. Smith S.
Equip., Inc., 10 S.W.3d 308, 312 (Tex. 2008) (―[A] motion made after judgment to
incorporate a sanction as a part of the final judgment does propose a change to that
judgment. Such a motion is, on its face, a motion to modify, correct or reform the existing
judgment within the meaning of Rule 329b(g).‖) Accordingly, Nath‘s second issue in
each case is meritless and is overruled.
D. Applicability of Texas Civil Practice and Remedies Code Chapter 41
In his third issue in each appeal, Nath contends that trial court abused its discretion
in ordering him to pay sanctions because Nath was entitled to the procedural safeguards
found in Chapter 41 of the Texas Civil Practice and Remedies Code. Nath asserts that
these procedural safeguards are applicable and were not afforded by the trial court in this
case. We note first that Nath waived this argument regarding TCH by failing to present it
to the trial court. See Tex. R. App. P. 33.1(a)(1)(A); Sterling v. Alexander, 99 S.W.3d
793, 797 (Tex. App.—Houston [14th Dist.] 2003, pet. denied). Thus, we consider this
issue in only Nath‘s appeal from the judgment and sanctions order in the Baylor case and
overrule issue three in the TCH appeal.
In addressing this issue, we must first determine whether the safeguards of
Chapter 41 are applicable in this case. Nath asserts that they are:
Texas Civil Practice & Remedies Code Annotated section 41.001(5)
defines ―exemplary damages‖ as ―any damages awarded as a penalty or by
way of punishment but not for compensatory purposes.‖ On page 2 of its
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Order and Modified Final Judgment, the trial court expressly states that the
award of $644,500.16 was intended both to ―punish Nath‖ and to
compensate Baylor College of Medicine. As such, the trial court‘s award of
$644,500.16, in part, constitutes ―exemplary damages‖ under Chapter 41 of
the Texas Civil Practice & Remedies Code. Therefore, Dr. Nath was
entitled to all of the procedural and substantive protections and safeguards
afforded to him by the Texas Legislature in that statute.
(record citations omitted).
By its express terms, Chapter 41 applies to ―any action in which a claimant seeks
damages relating to a cause of action.‖ Tex. Civ. Prac. & Rem. Code § 41.002(a)
(emphasis added). In turn, ―‗[c]laimant‘ means a party, including a plaintiff,
counterclaimant, cross-claimant, or third-party plaintiff, seeking recovery of damages.‖
Id. § 41.001(1) (emphasis added). Here, Baylor was never a plaintiff, counterclaimant,
cross-claimant, or third party plaintiff seeking damages. See id. Accordingly, Baylor is
not a ―claimant‖ under Chapter 41. Nath has provided no argument or authority to
contradict the plain language of the statute, which expressly excludes Baylor from its
application. Because Nath has failed to establish that Chapter 41 applies to this case, we
overrule his third issue in the Baylor appeal.
E. “Excessiveness” of Sanctions
In his fourth issue in each appeal, Nath contends that the trial court abused its
discretion by ordering Nath to pay monetary sanctions to TCH and Baylor that were
excessive under the circumstances presented. Because Nath failed to present this issue to
the trial court in his case against TCH, he has not preserved this issue for our review. We
therefore overrule Nath‘s fourth issue in the TCH appeal.
Considering this issue regarding sanctions awarded to Baylor, the Texas Supreme
Court in Low set out a ―nonexclusive list‖ of factors courts should consider in
determining the amount of sanctions, including:
the good faith or bad faith of the offender;
the degree of willfulness, vindictiveness, negligence, or frivolousness involved
in the offense;
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the knowledge, experience, and expertise of the offender;
any prior history of sanctionable conduct on the part of the offender;
the reasonableness and necessity of the out-of-pocket expenses incurred by the
offended person as a result of the misconduct;
the nature and extend of prejudice, apart from out-of-pocket expenses, suffered
by the offended person as a result of the misconduct;
the relative culpability of client and counsel, and the impact on their privileged
relationship of an inquiry into that area;
the risk of chilling the specific type of litigation involved;
the impact of the sanction on the offender, including the offender‘s ability to
pay a monetary sanction;
the impact of the sanction on the offended party, including the offended
person‘s need for compensation;
the relative magnitude of sanction necessary to achieve the goal or goals of the
sanction;
the burdens on the court system attributable to the misconduct, including
consumption of judicial time and incurrence of juror fees and other court costs;
and
the degree to which the offended person‘s own behavior caused the expenses
for which recovery is sought.
Low, 221 S.W.3d at 620 & n.5.
These factors were considered by the trial court in awarding sanctions to Baylor:
Nath‘s bad faith and improper purposes for filing the lawsuit; Nath‘s knowledge of the
law as a former law student; Nath‘s prior conduct as a litigant in numerous cases; the
expenses incurred by Baylor as a result of the litigation and the reasonable proportion to
the amount in controversy; Nath‘s relative culpability; the minimal risk of chilling
legitimate litigation activity posed by sanctions award; Nath‘s ability to pay for the
damages caused by his conduct; Baylor‘s need for compensation as a result of the
damages inflicted upon it in defending against Nath‘s lawsuit; the necessity of imposing a
substantial sanction to curtail Nath‘s abuse of the judicial process and to punish his bad
faith and improper conduct; the burdens on the court system attributable to Nath‘s
misconduct, including his consumption of extensive judicial time and resources in
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prosecuting this case; and the degree to which Nath‘s own behavior caused the expenses
for which Baylor sought reimbursement. Additionally, as discussed above, these findings
are supported by the record. A trial court may assess sanctions based on cumulative
conduct throughout litigation. See Falk & Mayfield L.L.P., 974 S.W.2d at 826.
Finally, the trial court reviewed evidence regarding the amount of attorney‘s fees
attributable to Nath‘s sanctionable behavior. Both Rule 13 and Chapter 10 allow for costs
and attorney‘s fees as a measure of sanctions. Tex. Civ. Prac. & Rem. Code §
10.004(c)(3); Tex. R. Civ. P. 13. Baylor established by affidavit evidence that it spent in
excess of $674,000 in defending against Nath‘s lawsuit and sought $644,500.16 as
attributable to Nath‘s conduct.5 The trial court assessed sanctions against Nath of
$644,500.16, which was supported by the evidence. Accordingly, the trial court did not
abuse its discretion in determining the award of sanctions to Baylor, and we overrule
Nath‘s fourth issue.
F. Constitutionality of Rule 13 and Chapter 10
In his fifth issue in the Baylor appeal only, Nath asserts that Rule 13 and Chapter
10 are unconstitutionally vague under the Due Process clause of the federal constitution
and Due Course of Law clause of the state constitution. See U.S. Const. amend. XIV § 1;
Tex. Const. art. I, §§ 13, 19. Nath relies on BMW of North America v. Gore for the
proposition that ―[e]lementary notions of fairness enshrined in our constitutional
jurisprudence dictate that a person receive fair notice not only of the conduct that will
subject him to punishment, but also of the severity of the penalty that a State may
impose.‖ 517 U.S. 559, 574 (1996). He contends that neither Rule 13 nor Chapter 10
specifically details the severity of the penalty that the trial court might impose.
Rule 13 identifies (a) the conduct punishable—filing any fictitious pleading or
making statements that are groundless, false, or for purposes of delay; (b) who may be
5
Baylor‘s affidavit explicitly linked attorney‘s fees to the claims the trial court determined were
groundless and brought in bad faith: defense of Nath‘s declaratory judgment action and defense of Nath‘s
defamation, negligence, tortious interference, and IIED claims.
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sanctioned—the person who signed the pleading, a represented party, or both; and (c) the
amount of possible sanctions—any sanctions available under Texas Rule of Civil
Procedure 215. Tex. R. Civ. P. 13. In turn, Rule 215.2(b) provides that a court may order
as sanctions ―reasonable expenses, including attorney fees.‖ Tex. R. Civ. P. 215.2(b)(8).
Similarly, Chapter 10 identifies (a) the punishable conduct—signing pleading or motion
for improper purpose or without evidentiary support; (b) who may be sanctioned—the
person signing the pleading, a represented party, or both; and (c) the amount—the
amount of reasonable expenses and attorney‘s fees. Tex. Civ. Prac. & Rem. Code §§
10.001, 10.002(c).
Nath provides no authority holding either Rule 13 or Chapter 10 unconstitutionally
vague. Both Rule 13 and Chapter 10 require notice and a hearing before sanctions may be
imposed. See, e.g., Worldwide Anesthesia Assocs. Inc. v. Bryan Anesthesia, Inc., 765
S.W.2d 445, 448 (Tex. App.—Houston [14th Dist.] 1988, no pet.) (stating that all due
process required was notice to the appellant and an opportunity to be heard regarding
sanctions); West v. Northstar Fin’l Corp., No. 02-08-00447-CV, 2010 WL 851415, at
*12–13 (Tex. App.—Fort Worth Mar. 11, 2010, pet. denied) (mem. op.) (concluding that
trial court need only provide notice of a sanctions hearing to comport with due process).
Here, Nath had notice that Baylor was seeking sanctions in a specific amount. Before
awarding Baylor its attorney‘s fees as sanctions, the trial court conducted a hearing on
Baylor‘s motion. Under these circumstances, we conclude that Nath‘s constitutional
rights to due process and due course of law were not violated. We overrule his fifth issue.
G. Excessive Fines Clauses
In issue six in the Baylor appeal only, Nath complains that the sanctions granted to
Baylor violate the Excessive Fines clauses of the federal and state constitutions. See U.S.
Const. amend. VIII; Tex. Const. art. I, § 13. After citing U.S. Supreme Court authority to
support the contention that the Eighth Amendment may apply to sanctions, Nath‘s entire
argument regarding this issue is as follows:
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The trial court‘s $600,000+ sanction against Dr. Nath, particularly when
considered in conjunction with the same trial court‘s $700,000+ sanction
against Dr. Nath on behalf of TCH, constitutes an excessive fine. It is vastly
disproportional to any criminal fine available for comparable conduct,
particularly when measured by the yardstick that the conduct in question
was committed by Dr. Nath‘s attorneys, and not Dr. Nath himself.
Nath has provided no authority that the particular sanction at issue here, i.e., the
$644,500.16 in attorney‘s fees awarded to Baylor as a sanction against Nath, is excessive.
Although it is undoubtedly a large amount of money, it represents a portion of the
attorney‘s fees actually incurred by Baylor, which were, at the time Baylor filed its
motion for sanctions, almost $675,000. Attorney‘s fees are the ―monetary guidepost of
the impact of the conduct on the party seeking sanctions and the burdens on the court
system.‖ Low, 221 S.W.3d at 620. Indeed, this court has upheld sanctions awards in the
amount of three times attorney‘s fees. See Falk & Mayfield, L.L.P., 974 S.W.2d 821,
823–24 (―We hold, therefore, that a trial court may, under appropriate circumstances,
impose sanctions under Rule 13 in excess of the costs or expenses incurred by the
defendant. Accordingly the trial court‘s imposition of sanctions for three times the
amount of attorney fees was not impermissible per se.‖). Accordingly, we conclude that
the sanctions imposed in this case do not violate the Excessive Fines clauses of the
federal and state constitutions. We overrule Nath‘s sixth issue.
CONCLUSION
In Nath‘s appeal of the monetary sanctions awarded to TCH, our cause number
14-11-00034-CV,6 we have overruled Nath‘s four issues. Similarly, in Nath‘s appeal of
the monetary sanctions awarded to Baylor in our cause number 14-11-00127-CV,7 we
6
Trial court cause number 2006-10826.
7
Trial court cause number 2006-10826A.
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have overruled Nath‘s six issues. Having overruled all of Nath‘s issues in both appeals,
we affirm the trial court‘s judgments.
/s/ Adele Hedges
Chief Justice
Panel consists of Chief Justice Hedges and Justices Jamison and McCally.
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Appendix: Trial Court’s Findings & Conclusions
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