Simmons v. Rogers

[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
FILED
U.S. COURT OF APPEALS
Nos. 94-4586 and 94-4368 ELEVENTH CIRCUIT
09/29/98
THOMAS K. KAHN
CLERK
D. C. Docket No. 89-10103 CIV-JLK
STUART I. LEVIN & ASSOCIATES, P.A.,
Plaintiff-Appellant,
versus
RONALD ROGERS,
Defendant-Appellee.
_____________________
No. 96-4345
_____________________
D.C. Docket No. 89-10103-civ-JLK
STUART I. LEVIN, as principal
of Stuart Levin & Associates,
Movant-Appellant,
versus
RONALD ROGERS,
Defendant-Appellee,
Appeals from the United States District Court
for the Southern District of Florida
(September 29, 1998)
Before TJOFLAT and BARKETT, Circuit Judges, and GODBOLD, Senior Circuit Judge.
TJOFLAT, Circuit Judge:
Attorney Stuart Levin appeals from the district court’s imposition upon him, under Rule
37 of the Federal Rules of Civil Procedure (1998) (“Rule 37”), of monetary sanctions for
violations of discovery orders during litigation in which Levin and an associate in his law firm,
Stuart Levin & Associates, represented the plaintiff. Levin argues that the district court erred by
imposing sanctions upon him personally, because he was not the “advising attorney” responsible
for the discovery abuses. In addition, Levin asserts that the court’s judgment imposing sanctions
against him should be vacated because he did not receive adequate notice of the sanctions
hearing and was therefore denied an opportunity to be heard, in violation of the Due Process
Clause of the Fifth Amendment. Finally, Levin claims that the attorney’s fees and expenses
awarded by the court as sanctions against him are excessive and not supported by the record.
Because we find that all of Levin’s arguments lack merit, we affirm.
I.
This case arose from the production of two similar musical recordings, “Yellow Bird”
and “Sunny Days.” Newton Simmons and appellee Ronald Rogers both were involved in the
production of the former, while the latter was produced by Rogers without Simmons’
involvement. Simmons and Rogers present substantially different versions, however, of the
circumstances under which the two recordings were recorded, manufactured, and marketed.
According to his Verified Amended Complaint,1 Simmons, also known under the stage
name “Bolivar,” is a performer and composer of traditional Caribbean music. In January 1989,
Simmons decided to record a music album, to be named “Yellow Bird,” consisting of a number
of Carribean songs. Simmons enlisted musicians for hire, including Rogers, to assist him in the
production of the album. In April 1989, Simmons arranged for the manufacture of the completed
album at his own expense. Subsequently, Simmons and Rogers entered into a distribution
agreement whereby Rogers agreed to distribute the Yellow Bird album in Monroe County,
Florida. For that purpose, between April and July 1989, Simmons provided Rogers with more
than 3,000 copies of the Yellow Bird album on cassette tape.
In his complaint, Simmons alleges that Rogers stopped distributing the Yellow Bird
cassettes in August 1989, and thereafter refused to return the cassettes. Instead, beginning in
September 1989, Rogers began distributing copies of a cassette entitled “Sunny Days,” the
musical arrangement and packaging for which is substantially similar to the Yellow Bird
cassette. Simmons claims that Rogers produced the Sunny Days cassette – essentially a
counterfeit of Yellow Bird – and caused retail sellers of the Yellow Bird cassette to cease selling
Yellow Bird and replace it with Sunny Days.
In November 1989, Simmons obtained a copyright on the Yellow Bird album. Simmons
served Rogers notice that his Sunny Days album infringed upon the Yellow Bird copyright.
1
We recite the facts from Simmons’ Verified Amended Complaint merely to provide
background to our discussion of the issues in this case. We do not comment on the validity or
veracity of the complaint’s allegations.
2
Simmons also demanded that Rogers return the Yellow Bird cassettes that he did not sell.
According to Simmons, Rogers not only refused to return the roughly 3,000 Yellow Bird
cassettes in his possession, he continued to market and sell Sunny Days despite notice that he
was violating Simmons’ Yellow Bird copyright.
As a result of Rogers’ alleged intransigence, Simmons, represented by the law firm of
Holland & Knight, brought suit against Rogers in July, 1990. Simmons alleged, inter alia, that
Rogers violated his copyright, infringed on his trademark, converted his personal property,
breached the distribution contract, and breached his fiduciary obligations to Simmons.
In September 1990, Rogers filed a counterclaim, bringing virtually identical charges
against Simmons: copyright infringement, common law trademark infringement, breach of
contract, and breach of fiduciary obligation, among others.2 Rogers challenged Simmons’
version of the events surrounding the composition and production of the Yellow Bird cassette.
Rogers claimed that he commissioned Simmons to record an album of “ten favorite Island
songs,” and that Yellow Bird was the result of this collaborative project between him and
Simmons. He asserted in his counterclaim that they composed several of the songs together,
collaborated on the song list, and shared the cost of producing the album. In addition, Rogers
alleged that his wife designed the packaging for the cassette, and that he chose the musicians and
instruments to be used in recording the songs. Rogers claimed that he and Simmons orally
agreed jointly to copyright Yellow Bird – and that the copyright designation on the package for
2
Rogers filed his counterclaim pro se. Although the counterclaim alleges copyright
infringement in its general averments, it does not contain a separate count asserting copyright
infringement. In his fraud count, however, Rogers claims that Simmons caused him to lose his
“copyright rights.”
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the cassette even includes the name and address of Rogers’ business – but that Simmons then
perfidiously filed a copyright registration from which he omitted Rogers. According to Rogers,
Simmons compounded his offensive behavior by distributing Yellow Bird on his own in Monroe
County – in which Rogers had the exclusive right to distribute the album under the contract –
and by telling retail sellers that Rogers’ non-infringing Sunny Days cassette violated his
copyright on Yellow Bird, causing the retail sellers to remove Sunny Days from their stores.
The parties’ sharply contrasting stances regarding the factual predicate of the litigation
set the stage for an extended and acrimonious discovery period. The record is replete with
motions to compel the production of documents, to compel answers to interrogatories, and to
compel depositions. Rogers noted in one May 1991 pleading requesting sanctions against
Simmons that he had already filed four motions to compel discovery, all of which had been
granted by the court. In her Omnibus Report and Recommendation dated August 12, 1991, the
magistrate judge assigned to the case again ordered the production of certain documents and
recommended that the district court impose sanctions against Simmons under Rule 37(b)(2) for
failing to comply with the court’s discovery orders. On August 29, 1991, the district court
approved the magistrate’s recommendations. Shortly thereafter, Holland & Knight withdrew as
counsel, citing Simmons’ failure to “fulfill his obligations according to his agreement with
Holland & Knight” and his insistence on “pursuing an objective that Holland & Knight
consider[ed] imprudent.”
In January 1992, after numerous extensions of time for Simmons to obtain new counsel –
during which time the magistrate judge entered additional orders compelling Simmons to
produce documents and answer interrogatories – Stuart I. Levin entered an appearance on behalf
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of Simmons. On March 23, 1992, Simmons and his counsel again were ordered to produce the
documents referred to in the magistrate judge’s August 12, 1991, report and recommendation to
the district court. By May of 1992, the magistrate judge recommended that the district court
dismiss Simmons’ complaint. She wrote in her July 14, 1992, Omnibus Report and
Recommendation that “Simmons’ flagrant disregard for this Court and the discovery process and
his wilful failure to comply with numerous court orders justifies the severe sanction of
dismissal,” and that “Simmons’ failures in the area of discovery are legend.” Regarding the
performance of substitute counsel, the judge wrote:
When Simmons’ attorney withdrew as counsel of record in October 1991, this
Court allowed Simmons numerous extensions of time to obtain substitute counsel.
Substitute counsel was finally obtained some three months later in January 1992.
At that time substitute counsel was personally notified by this Court of the
numerous discovery requests which remained unanswered as well as the
numerous motions pending to which no responses had been filed. Agreeing to
overlook the untimeliness of any discovery responses made and motion responses
filed, the undersigned permitted substitute counsel an extended period of time in
which to respond to outstanding motions and produce sought after discovery.
Simmons simply ignored this order, forcing this Court to enter the same order on
at least two separate occasions. Simmons finally complied with these orders but
then only partially. To date there remains pending numerous discovery requests,
some as much as ten (10) months old, as well as many unresponded to discovery
and dispositive motions. Further, countless orders directing discovery
compliance simply go ignored. Simmons’ discovery abuses and flagrant
disregard for this Court’s orders simply cannot be tolerated any longer.
The district court adopted the magistrate’s report and dismissed Simmons’ complaint on August
5, 1992, sending a copy of its order to Stuart Levin.
The suit, and Simmons’ intransigence, continued because of the unresolved issue of
Rogers’ counterclaim. On December 15, 1992, the magistrate judge recommended that a default
judgment be entered against Simmons on the counterclaim and recommended sanctions against
5
Simmons. The district court adopted the recommendations in its order dated February 12, 1993,
granting both default judgment and Rogers’ motion for sanctions.
An evidentiary hearing on Rogers’ consolidated motions for sanctions was held on
August 6, 1993; Levin’s associate Robert Horkitz appeared on Simmons’ behalf but did not
speak at the hearing. On November 30, 1993, the district court entered an order imposing
sanctions for discovery abuse under Rule 37(b)(2) against both Holland & Knight and Levin.
The district court based its sanctions decision upon the October 27, 1993, “Report and
Recommendations Regarding the Propriety of Sanctions against Holland & Knight” prepared by
the magistrate judge. In that report and recommendation, the magistrate found that the
obstructive tactics of Newton Simmons and his counsel began during Holland & Knight’s tenure,
and that Holland & Knight had not rectified its abuses before it withdrew from the case. He also
held Levin liable, however, because rather than rectifying Holland & Knight’s transgressions,
Levin participated in and perpetuated the abuses of the district court’s discovery orders. The
magistrate judge wrote:
That is not to say that Stuart Levin does not share in the blame. After Holland
[&] Knight’s withdrawal, Simmons and successor counsel Levin were given
multiple extensions of time to respond to discovery and to motions that required
responses. They were even given an opportunity to reevaluate Simmons’
previous discovery objections. Simmons and successor counsel Levin failed to
take advantage of these opportunities.
Holland & Knight subsequently settled with Rogers on the sanctions awarded against it by the
district court, and was released as a party to the sanctions proceedings.
The district court also entered its Order of Final Judgment on Counterclaim on November
30, 1993, noting that Simmons had failed to respond to Rogers’ motion for entry of judgment on
the defaulted counterclaim. At the subsequent trial for damages, the only attorney to appear on
6
behalf of Simmons was attorney David Rowe, who stated that he had joined Levin’s firm as
counsel. Rowe told the district court that Levin had called him and asked him to appear because
his associate Horkitz had been hospitalized for leukemia and Levin himself was involved in a
deposition. Rogers’ counsel noted that Levin was counsel of record for Simmons, that he had
sent a number of letters providing notice of the hearing to Levin, and that he was prepared to
hold the hearing. Upon hearing Rowe’s claim that he knew nothing of the case, the court
advised Rowe not to get involved in the case at such a late date and with no knowledge of the
matters at hand. The court then proceeded to hear the evidence presented by Rogers.
On March 4, 1994, the district court entered final judgment awarding Rogers $4,941,444
in actual and exemplary damages, together with $298,521.90 in attorney’s fees against Simmons.
Based on an affidavit prepared by Rogers’ counsel, the court also imposed $29,953 in Rule
37(b)(2) sanctions against Levin. Levin’s subsequent Motion to Vacate Judgment, filed under
Rule 60(b) of the Federal Rules of Civil Procedure (1998), was denied by the district court.
Levin timely appealed both the district court’s final judgment and its denial of his motion to
vacate. These consolidated appeals are presently before us.
II.
Levin raises three issues on appeal. First, he argues that the specific language of Rule
37(b)(2) provides for the imposition of discovery sanctions upon only the “advising attorney,”
and that he was merely the employer of the “advising attorney” responsible for the sanctionable
conduct. Second, Levin argues that the district court should have granted his Federal Rule of
Civil Procedure 60(b) motion to vacate judgment because he did not receive adequate notice and
7
an opportunity to be heard prior to the imposition of sanctions against him. Finally, Levin
claims that the attorney’s fees claimed by Rogers’ lawyers that served as the basis for the district
court’s sanctions award are excessive and not supported by the record. We address these claims
in order and find that they have no merit. We therefore affirm the district court’s judgment.
A.
Our review of the district court’s imposition of Rule 37(b)(2) sanctions against Levin is
“limited to a search for abuse of discretion and a determination that the findings of the trial court
are ‘fully supported by the record.’” Carlucci v. Piper Aircraft Corp., 775 F.2d 1440, 1447 (11th
Cir. 1985) (citing National Hockey League v. Metropolitan Hockey Club, Inc., 427 U.S. 639,
642, 96 S. Ct. 2778, 2780, 49 L. Ed. 2d 747 (1976) (per curiam)).
Rule 37(b)(2) provides a range of sanctions that a district court may impose upon parties
and their attorneys for failure to comply with the court’s discovery orders. It provides that the
court, in its discretion, may impose, among others, the following sanctions: (1) the court may
order that disputed facts related to the violated order be considered established in accordance
with the claim of the party obtaining the sanctions order; (2) the court may refuse to permit the
violating party to raise certain defenses, or it may prohibit that party from opposing certain
claims or defenses of the party obtaining the sanctions order; (3) the court may strike any
pleadings or any parts of the pleadings of the violating party, stay the proceedings, or even
dismiss the action or enter a judgment of default against the violating party; and (4) the court
may consider the violation a contempt of court. In addition to these sanctions, Rule 37(b)(2)
provides:
8
In lieu of any of the foregoing orders or in addition thereto, the court shall require
the party failing to obey the order or the attorney advising that party or both to
pay the reasonable expenses, including attorney’s fees, caused by the failure,
unless the court finds that the failure was substantially justified or that other
circumstances make an award of expenses unjust.
Fed. R. Civ. P. 37(b)(2) (emphasis added). Levin claims that the district court’s imposition of
sanctions upon him – in the form of attorney’s fees under this last provision of Rule 37(b)(2) –
was an abuse of discretion because his associate, Robert Horkitz, was the attorney “advising”
Simmons during the discovery period, not Levin himself.3
3
Levin also claims that he may not be held liable under Rule 37(b)(2) simply because he
was Horkitz’s employer. He bases this argument upon the Supreme Court’s decision in Pavelic
& LeFlore v. Marvel Entertainment Group, 493 U.S. 120, 110 S. Ct. 456, 107 L. Ed. 2d 438
(1989). In Pavelic, the Court held that a district court could not impose sanctions under Fed. R.
Civ. P. 11 against a law firm, because the clear text of Rule 11 required that sanctions be
imposed against the “person who signed” the frivolous document presented to the court. See id.
at 123-27, 110 S. Ct. at 458-60. The Court held that it would be “as strange to think that the
phrase ‘person who signed’ . . . refers to the partnership represented by the signing attorney, as it
would be to think that the earlier phrase [in Rule 11] ‘the signer has read the pleading’ refers to a
reading not necessarily by the individual signer but by someone in the partnership.” Id. at 124,
110 S. Ct. at 458-59. Refuting the notion that principles of partnership and agency law made
imposition of sanctions upon law firms acceptable under Rule 11, the Court held that Rule 11
departs significantly from the common law because it imposes a non-delegable duty upon an
attorney signing a document to “satisfy himself that the filed paper is factually and legally
responsible; by signing he represents not merely the fact that it is so, but also the fact that he
personally has applied his own judgment.” Id. at 125, 110 S. Ct. at 459. Levin argues that
“attorney advising” in Rule 37 is analogous to “person who signed” in Rule 11, and that,
therefore, he cannot be liable under principles of agency for the discovery abuses of his associate
Horkitz.
Levin presents a very interesting argument, made even more interesting by two additional
facts: (1) although the magistrate wrote that Rule 37 sanctions were appropriate against “Stuart
Levin,” the district court, in its Final Judgment dated March 4, 1994, actually held that “Stuart
Levin & Associates” was responsible for $29,953 in attorneys fees; and (2) on at least two
occasions, this circuit has affirmed – without discussing the Pavelic argument raised by Levin –
Rule 37 sanctions imposed against law firms. See BankAtlantic v. Blythe Eastman Paine
Webber, Inc., 12 F.3d 1045 (11th Cir. 1994) (upholding award of sanctions under Rule 37 against
law firm and client for withholding evidence in violation of discovery order); Pesaplastic, C.A.
v. Cincinnati Milacron Co., 799 F.2d 1510 (11th Cir. 1986) (upholding sanctions award against
law firm and corporate client under Rule 37). Because we hold that Levin was an “advising
9
Levin’s argument is unpersuasive. The record indicates that Levin entered an appearance
on behalf of Simmons in January of 1992. From that time on, Levin was at all times counsel of
record for Simmons. Levin signed many of Simmons’ pleadings, particularly early in his
representation. Levin asserts that he turned over responsibility for representing Simmons to his
associate, Horkitz, and that Horkitz was responsible for the discovery abuse for which he is now
being sanctioned. This argument is unavailing. As counsel of record, Levin owed a duty to his
client fully to represent his interests, and he owed a duty to the court to comply with the court’s
orders. Although Levin may have delegated some of these duties to his associate, such a
delegation – while it may provide a ground for sanctioning Horkitz – did not relieve Levin of his
own duties. We find that the record fully supports the district court’s determination that
Simmons was an “advising” attorney and therefore hold that the district court did not abuse its
discretion when it held Levin liable for sanctions under Rule 37(b)(2).
B.
attorney” – and thus directly liable under the terms of Rule 37 – and because Levin, by his own
admission (he claims repeatedly that the court held him “personally liable”), is the only person
responsible for paying the sanction imposed against Stuart Levin & Associates, we need not
address this argument by Levin.
Of course, we do note that during the pendency of Levin’s case, Rule 11 was amended to
expressly provide for the sanctioning of law firms, permitting courts to hold firms “jointly
responsible for violations committed by its partners, associates, and employees.” Fed. R. Civ. P.
11 (1998); see also Prim v. Peatco Ltd, 1995 WL 447648, at *1 (S.D.N.Y. July 27, 1995) (“The
amendments to Rule 11, however, which became effective on December 1, 1993, changed the
Pavelic rule and provides [sic] that ‘[a]bsent exceptional circumstances, a law firm shall be held
jointly responsible for [rule] violations . . . .’” (citation omitted)). We do not reach the
determination of whether the old rule or the amended rule should apply to Levin’s actions, see
Paese v. New York Seven-up Bottling Co., 158 F.R.D. 34, 36-37 (S.D.N.Y. 1994), because of
our holding that Levin is directly liable under Rule 37 as an advising attorney.
10
Following the district court’s entry of final judgment awarding Rogers damages and
attorney’s fees, including the attorney’s fees imposed upon Levin as sanctions for the Rule 37
violations, Levin filed a motion to vacate the judgment pursuant to Federal Rule of Civil
Procedure 60(b). The district court denied Levin’s motion. We review this denial for abuse of
discretion. See Commodity Futures Trading Comm’n v. American Commodity Group Corp.,
753 F.2d 862, 866 (11th Cir. 1984).
Levin claims that the district court erred in denying his motion to vacate the judgment
because he had not received notice and an opportunity to be heard before the sanctions judgment
was entered. Levin premises his due process argument, like his argument that he was not the
“advising” attorney, upon his assertion that he turned over responsibility for the case to his
associate Horkitz. Levin points out that he may not have seen correspondence indicating that he
could be liable for damages in this case because it might have been routed to his associate rather
than to him.
Levin’s claim of no notice borders on the frivolous. As mentioned above, at the trial on
damages, David Rowe appeared on behalf of Levin’s firm to inform the court that Horkitz was in
the hospital undergoing treatment for leukemia. He told the court that he had been called by
Levin the night before and asked to appear because Levin was otherwise engaged. Levin not
only was aware of the proceedings going on before the district court, he was also – not
surprisingly – aware that his associate, to whom he had supposedly delegated responsibility over
Simmons’ case, was hospitalized with a serious illness. Rather than bringing this fact to the
court’s attention, timely seeking any necessary continuance, and handling the case himself,
11
Levin chose not to appear before the court, a move consistent with his later claim of complete
ignorance.
Levin was responsible for the management of his client’s interests and for complying
with orders of the court. The fact that numerous motions for sanctions were filed by Rogers, and
that Levin was made aware of the outstanding orders of the court compelling production of
documents and answers to interrogatories when he first appeared on Simmons’ behalf, leads us
to the inescapable conclusion that Levin received sufficient notice of the imposition of Rule
37(b)(2) sanctions imposed by the court to satisfy the requirements of due process. See Devaney
v. Continental Am. Ins. Co., 989 F.2d 1154, 1160 (11th Cir. 1993) (“[A] motion for sanctions
under Rule 37, even one which names only a party, places both that party and its attorney on
notice that the court may assess sanctions against either or both . . . .”).
C.
Levin’s final claim – that the damages awarded by the district court are excessive and
unsupported by the record – is as meritless as his first two claims. In its order affirming the
magistrate’s recommendation that Levin be sanctioned, the district court requested that Rogers’
counsel provide an affidavit detailing counsel’s fees and expenses related to Levin’s discovery
abuse; in response, Rogers’ counsel provided a detailed accounting of his expenses totaling
$29,953. Levin did not object to, nor seek to controvert in any way, the expenses claimed by
Rogers’ counsel, and the district court found the amount to be reasonable. Levin’s post hoc
argument that Rogers’ counsel spent too much time preparing the motions related to the Rule
37(b)(2) sanctions, and that counsel’s practice of billing in fifteen-minute intervals is unfair to
12
him, comes too late. We find that the district court’s decision to accept the affidavit of fees and
expenses from Rogers’ counsel was entirely reasonable, and certainly not an abuse of its
discretion.
III.
For the foregoing reasons, we find that the district court did not abuse its discretion in
imposing Rule 37(b)(2) sanctions in the amount of $29,953 against Stuart Levin, or in denying
his motion to vacate the judgment. We therefore AFFIRM the rulings of the district court.
AFFIRMED.
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