Enrique Lozano v. Julio Cabrera

FILED
NOT FOR PUBLICATION
FEB 07 2017
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
ENRIQUE LOZANO, No. 15-55535
Plaintiff-Appellant, D.C. No.
3:14-cv-00333-JAH-RBB
v.
JULIO YEE CABRERA; ENRIQUE MEMORANDUM*
WONG VASQUEZ,
Defendants-Appellees.
ENRIQUE LOZANO, No. 16-55522
Plaintiff-Appellant, D.C. No.
3:14-cv-00333-JAH-RBB
MARK D. POTTER; RUSSELL CLIVE
HANDY,
Appellants,
v.
JULIO YEE CABRERA; ENRIQUE
WONG VASQUEZ,
Defendants-Appellees.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Appeal from the United States District Court
for the Southern District of California
John A. Houston, District Judge, Presiding
Submitted January 10, 2017**
Pasadena, California
Before: TALLMAN and FRIEDLAND, Circuit Judges, and FABER,*** Senior
District Judge.
Enrique Lozano appeals the district court’s order dismissing his 2014
lawsuit under Title III of the Americans with Disabilities Act (ADA) and related
state laws for lack of subject matter jurisdiction. Lozano also appeals the district
court's order imposing sanctions against Lozano and his counsel pursuant to
Federal Rule of Civil Procedure 11. We have jurisdiction under 28 U.S.C. § 1291.
We review de novo the dismissal of a lawsuit, whether under Rules 12(b)(1),
12(b)(6) or 56. Naffe v. Frey, 789 F.3d 1030, 1035 (9th Cir. 2015); Ariz. State
Carpenters Pension Trust Fund v. Citibank, 125 F.3d 715, 720 (9th Cir. 1997).
We affirm the dismissal, but for different reasons than those stated by the district
court. See Tanner v. Heise, 879 F.2d 572, 576 (9th Cir. 1989). An order imposing
Rule 11 sanctions is reviewed for an abuse of discretion. See Cooter & Gell v.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
***
The Honorable David A. Faber, Senior United States District Judge
for the Southern District of West Virginia, sitting by designation.
2
Hartmarx Corp., 496 U.S. 384, 405 (1990). We vacate the award of sanctions and
remand.
1. Lozano, a paraplegic who uses a specially equipped van, alleged that he
was denied a handicapped accessible parking space at a commercial property
owned by defendants Julio Yee Cabrera and Enrique Wong Vasquez. In 2001,
Lozano had also filed an ADA lawsuit against Cabrera and Vasquez based upon
the lack of handicap accessible parking at the same property. The 2001 lawsuit
settled and, pursuant to a Stipulation of Dismissal signed by the court, the 2001
court was to retain jurisdiction over all disputes arising out of the settlement
agreement. Finding that the 2014 lawsuit fell within the terms of the 2001
settlement agreement, the district court dismissed the 2014 lawsuit under Federal
Rule of Civil Procedure 12(b)(1), concluding that it lacked jurisdiction over the
lawsuit because Lozano should have filed a motion to enforce the earlier settlement
in the 2001 court.
Although we disagree with the district court’s conclusion that it did not have
jurisdiction over the lawsuit, the lawsuit was properly dismissed as barred by the
prior settlement. And because the court considered matters outside the pleadings
in so concluding, Rule 56, rather than Rule 12(b)(6), was the proper vehicle for
dismissal. See Tanner, 879 F.2d at 577 (treating a “motion to dismiss as a motion
3
for summary judgment and apply[ing] the standard of Rule 56 of the Federal Rules
of Civil Procedure in [court of appeals’] de novo review of the Rule 12(b)(6)
dismissal”).
2. Defendants moved for sanctions under both Rule 11 and 28 U.S.C.
§ 1927. The court granted defendants’ motion for sanctions under Rule 11,
concluding that the lawsuit was not warranted by law and was filed to pressure
defendants into paying an additional monetary settlement. The district court
expressly declined to award sanctions pursuant to 28 U.S.C. § 1927, stating that
“[b]ecause this Court granted Defendants’ motion for sanctions under Rule 11
based upon the same conduct, the Court finds sanctions under section 1927
unwarranted.” (No. 16-55522).
There are three primary mechanisms through which a court may “sanction
parties or their lawyers for improper conduct: (1) Federal Rule of Civil Procedure
11, which applies to signed writings filed with the court; (2) 28 U.S.C. § 1927,
which is aimed at penalizing conduct that unreasonably and vexatiously multiplies
the proceedings; and (3) the court’s inherent power.” Fink v. Gomez, 239 F.3d
989, 991 (9th Cir. 2001). “Each of these sanctions alternatives has its own
particular requirements, and it is important that the grounds be separately
articulated to assure that the conduct at issue falls within the scope of the sanctions
4
remedy.” Christian v. Mattel, Inc., 286 F.3d 1118, 1131 (9th Cir. 2002).
A number of the reasons the district court gave for imposing sanctions fall
outside the scope of conduct that would support the imposition of sanctions under
Rule 11. (No. 16-55522). Given that the district court considered extra-pleadings
conduct in awarding sanctions pursuant to Rule 11, we vacate the sanctions award
and remand to allow the district court to consider whether to award sanctions under
28 U.S.C. § 1927 or to clarify its reasons for imposing sanctions under Rule 11.
See Christian, 286 F.3d at 1131; Truesdell v. S. Cal. Permanente Med. Grp., 293
F.3d 1146, 1154 (9th Cir. 2002). We are not deciding that the conduct of counsel
was not sanctionable; merely, that the wrong procedural mechanism was invoked
to support the sanctions imposed.
3. Appellees’ request for judicial notice, filed on October 6, 2015, is denied
as unnecessary.
The parties shall bear their own costs on appeal.
AFFIRMED in part, VACATED in part, and REMANDED.
5