Freddy Burton v. Infinity Capital Management

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
FREDDY JOE BURTON; JAN PAUL No. 12-15618
KOCH,
Plaintiffs-Appellees, D.C. No.
2:11-cv-01129-
v. RCJ-PAL
INFINITY CAPITAL MANAGEMENT;
ANNE PANTELAS; SALVATORE C. OPINION
GUGINO,
Defendants-Appellants,
and
RONALD J. ISRAEL,
Defendant.
Appeal from the United States District Court
for the District of Nevada
Robert Clive Jones, Chief District Judge, Presiding
Argued and Submitted
November 7, 2013—San Francisco, California
Filed June 4, 2014
2 BURTON V. INFINITY CAPITAL MANAGEMENT
Before: Sidney R. Thomas, Ronald Lee Gilman*,
and Johnnie B. Rawlinson, Circuit Judges.
Opinion by Judge Thomas;
Dissent by Judge Gilman
SUMMARY**
Quasi-Judicial Immunity
Affirming the district court’s denial of summary
judgment, the panel held that an attorney who prepared an
order to show cause for a judge was not entitled to absolute
quasi-judicial immunity on a claim of violation of the
automatic stay provision of the Bankruptcy Code.
Dissenting, Judge Gilman wrote that the attorney was
entitled to quasi-judicial immunity because he was in effect
acting as the judge’s law clerk.
COUNSEL
Kenneth R. Lund (argued) and Brian K. Terry, Thorndal,
Armstrong, Delk, Balkenbush & Eisinger, Las Vegas,
Nevada, for Defendant-Appellant Salvatore C. Gugino.
*
The Honorable Ronald Lee Gilman, Senior Circuit Judge for the U.S.
Court of Appeals for the Sixth Circuit, sitting by designation.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
BURTON V. INFINITY CAPITAL MANAGEMENT 3
Daniel R. McNutt (argued), Carbajal & McNutt, LLP, Las
Vegas, Nevada, for Defendants-Appellants Infinity Capital
Management and Anne Pantelas.
Jan Paul Koch (argued), Law Office of Jan Paul Koch, Las
Vegas, Nevada; Robert J. Kossack, Kossack Law Offices, Las
Vegas, Nevada, for Plaintiffs-Appellees Freddy Joe Burton
and Jan Paul Koch.
OPINION
THOMAS, Circuit Judge:
This case requires us to decide whether an attorney who
prepares an order to show cause for a judge is entitled to
absolute quasi-judicial immunity. We hold that he is not and
affirm the judgment of the district court.
I
Freddy Joe Burton (“Burton”) was injured in a bicycle-
automobile collision. He incurred $271,101.87 in related
medical expenses and loans and retained Jan Paul Koch
(“Koch”) to file a lawsuit on his behalf. Burton granted
certain creditors, including Valley Hospital Medical Center,
liens on his personal injury claim. Valley Hospital then sold
its account receivable to Infinity Capital Management
(“Infinity”), the president of which is Anne Pantelas
(“Pantelas”). Koch settled Burton’s personal injury claim for
$185,000.
Koch placed the settlement funds in his client trust fund
account and paid himself his attorney fee and costs. Koch
4 BURTON V. INFINITY CAPITAL MANAGEMENT
then recommended that Burton declare bankruptcy and hire
bankruptcy attorney David Crosby (“Crosby”). After paying
a retainer fee to Crosby and receiving his personal injury
settlement exemption, Burton had $104,088.10 left of his
settlement in the trust fund account.
That same month, Nancy Alff (“Alff”), who represented
Infinity at the time, told Koch that a state interpleader action
would resolve the interests of the lien holders more quickly
than the bankruptcy court. Infinity filed an interpleader
lawsuit in state court against all other similarly situated lien
holders making a claim upon Burton’s settlement. Neither
Burton nor Koch were named as parties in the state
interpleader case. The Honorable Ronald Israel (“Judge
Israel”) was assigned to the case. Salvatore Gugino
(“Gugino”) was substituted for Alff as Infinity’s attorney of
record.
Crosby filed Burton’s bankruptcy petition in bankruptcy
court. Four days later, Judge Israel held a status hearing on
the state interpleader case, and Koch attended that hearing at
Judge Israel’s request. At the hearing, Gugino appeared for
Infinity, and Steven Baker (“Baker”) appeared for one of the
defendants in the case. Judge Israel questioned Koch as to
why he had not interpled all of the funds that Burton had
received for his settlement to the court clerk as required by
Michel v. Eighth Judicial District Court ex rel. County of
Clark, 17 P.3d 1003 (Nev. 2001). Koch informed Judge
Israel that Burton had filed bankruptcy and he would be
depositing the remaining settlement funds with the
bankruptcy clerk. Those present at the hearing were confused
about the proper course to take given the bankruptcy
proceeding and the fact that Burton was neither a plaintiff nor
defendant in interpleader. Both Gugino and Baker voiced
BURTON V. INFINITY CAPITAL MANAGEMENT 5
concern about the interpleader case moving forward in light
of the bankruptcy. Judge Israel ordered the parties to appear
approximately two months later for a status hearing regarding
the state of the bankruptcy proceeding.
Three days before the status hearing, Gugino sent all
parties to the interpleader case and Koch a letter with a copy
of the minutes from the prior hearing and an update on the
bankruptcy case, including both an explanation of his initial
attempt to resolve the interpleader issue with the trustee and
confirmation that Koch had deposited the settlement funds
with the trustee.
Koch did not appear at the status hearing. At the hearing,
Gugino handed a copy of his letter to Judge Israel, and he
informed the court that Koch had deposited the settlement
funds with the bankruptcy trustee. Judge Israel responded, “I
ordered Mr. Koch to place all the funds in here. . . . I’m
going to issue an order to show cause. I want Mr. Koch to
appear and show – tell us why he didn’t deposit his attorney’s
fees into – pursuant to Michel. . . . I want him to personally
appear and tell why he hasn’t; otherwise, I’ll hold him in
contempt.” Neither Gugino nor Baker voiced any opposition
to Judge Israel in light of the bankruptcy. The following
colloquy then occurred:
MR. GUGINO: Well, the plaintiff in the case,
the injured party was – in addition to the – the
money that Mr. Koch was giving himself for
his attorney’s fees, he also paid Mr. Burton
16,500 under NRS 21.090. So.
MR. BAKER: Which is a fraudulent transfer.
6 BURTON V. INFINITY CAPITAL MANAGEMENT
THE COURT: So –
MR. GUGINO: I – I don’t know what to say.
THE COURT: – is – well, obviously the
bankruptcy court’s going to have to deal with
part of that, but who wants to prepare the
order?
MR. GUGINO: What day?
THE COURT: Mr. Gugino?
MR. GUGINO: I’ll prepare it, Your Honor.
THE COURT: Thirty days.
THE CLERK: Thirty days, we’ll set it for July
11th and that’ll be 9 a.m.
MR. GUGINO: Okay.
On that same day, Gugino prepared a proposed order to
show cause and sent it to all of the interpleader parties and
Koch. A cover letter stated that, unless Gugino heard from
them to the contrary, he would assume it met with their
approval and would submit it to the court for the judge’s
signature. The proposed order ordered Koch to appear “to
explain to [the court] why he should not be held in contempt
for failure to comply with Michel . . . as directed by [the
court].” That same day, Koch replied by sending Gugino a
fax objecting to the order and stating, “You are violating the
automatic stay provisions of 11 U.S.C. § 362.”
BURTON V. INFINITY CAPITAL MANAGEMENT 7
The following day, Koch sent Gugino a fax and a four-
page letter. The letter stated that the automatic stay prevented
proceedings directed toward the property of the bankruptcy
estate, threatened that he would file a complaint against
Gugino, Infinity, Pantelas, and Judge Israel if “at any time
[he] bec[a]me aware of further action in the Infinity litigation
(pursued by anyone),” and made personal attacks on
Gugino’s competency. The fax stated that the complaint was
“90% complete” and included a draft copy of the seven-page
complaint.
The order drafted by Gugino was never filed. Instead,
Judge Israel faxed the minute order from the June 6th status
check hearing to the parties of the interpleader case and
Koch. The minute order stated:
Mr. Gugino noted the letter provided to the
Court changes things. Mr. Gugino further
noted Mr. Koch took the remaining money
and gave it to the bankruptcy trustee.
Colloquy regarding Mr. Koch not present
today and issues regarding following the
Michel Case. Court directed Counsel to
prepare an order for a show cause hearing and
Court set hearing.
....
COURT ORDERS All parties to appear,
including Mr. Koch, to advise the Court of;
1. The bankruptcy.
8 BURTON V. INFINITY CAPITAL MANAGEMENT
2. Why the bankruptcy can effect [sic] and
stay these proceedings, since Mr. Burton is
not a party to this action.
3. Why Mr. Koch should interplead the entire
proceeds of the settlement per the Michel case
into this court immediately.
4. Status on lifting the stay.
COURT ORDERED Matter re-set from a
show cause hearing to a Status Check
regarding: bankruptcy / interpleader.
Later that day, Gugino faxed a letter to Koch that included the
minute order. The letter stated in part:
First, let me make it clear that you did not
attend the June 6, 2011 status check before
Judge Israel, even though you were aware of
the hearing date. Had you been present, all of
this might have been avoided. At the hearing,
I presented the Court with my June 3, 2011
letter and attachments, which had been
previously sent to you and the attorneys
involved in this litigation. It was my
expectation that we would be going forward
in the Bankruptcy Court under some sort of
stipulation and order. However, at the
hearing, Judge Israel ordered that an Order To
Show Cause be issued against you, and he
then directed me to prepare the Order. This
was not my idea, nor did I recommend it to
the Court. After preparing a draft of the
BURTON V. INFINITY CAPITAL MANAGEMENT 9
proposed Order, I sent it to your attention for
your review. Had you called me upon receipt,
you could have avoided incurring the hours
you claim to have spent preparing a class
action complaint against my client, her
company, myself and Judge[] Israel . . . .
Gugino also included a footnote stating, “It is not my
habit to refuse to obey a directive of a judge. I simply
followed his directive to prepare a draft of the order . . . .”
Later that same day, Koch faxed a response to Gugino stating,
“In response to your 6-9-11 letter . . . . Attached hereto
please find the rough draft of the Federal Lawsuit that I am
filing.”
The following day, Koch sent Gugino a copy of a
Memorandum in Support of Jurisdiction by fax and stated in
part, “Why don’t you dismiss the interpleader, and get your
funds from the bankruptcy trustee? Otherwise, what do you
suggest? I’ll hold up and won’t send copies to Judge Israel,
pending your reply.”
Nearly a month later, Koch sent Gugino a fax stating,
“Don’t know why you never responded to my last entreaty.
Guess it matters not. It’s been filed. Here’s a copy. See ya
in Court.”
Koch then filed a complaint in federal district court, on
behalf of himself and Burton, alleging that all defendants
violated the automatic-stay provision of 11 U.S.C. § 362(a).
He claimed actual damages of $1,000, plus attorney fees, and
sought “damages in excess of $10,000.”
10 BURTON V. INFINITY CAPITAL MANAGEMENT
Judge Israel filed a motion to dismiss the complaint,
arguing that Koch’s claims were barred as a matter of law by
the doctrine of absolute judicial immunity. Gugino filed a
separate motion to dismiss, arguing that because his acts were
taken under the direction of Judge Israel, Koch’s claims were
barred by the doctrine of absolute quasi-judicial immunity.
The district court converted both motions to dismiss into
motions for summary judgment because the parties attached
various exhibits outside of the pleadings. The court held
Judge Israel was entitled to absolute judicial immunity.
However, the court held “Gugino [was] not entitled to quasi-
judicial immunity because Gugino volunteered to prepare the
order in direct violation of the stay. Gugino had a duty to not
prepare or present the order.” This appeal followed.
We review a district court’s order denying a converted
motion for summary judgment de novo. Lewis v. United
States, 641 F.3d 1174, 1176 (9th Cir. 2011). We must view
the evidence in the light most favorable to the nonmoving
party, here Koch and Burton. Cnty. of Tuolumne v. Sonora
Cmty. Hosp., 236 F.3d 1148, 1154 (9th Cir. 2001). The
proponent of a claim for absolute immunity “bears the burden
of establishing that such immunity is justified.” Curry v.
Castillo (In re Castillo), 297 F.3d 940, 947 (9th Cir. 2002).
II
This case does not concern whether the automatic stay is
violated when an attorney drafts, at the behest of a judge, an
order to show cause that was never filed, much less whether
such an act is actionable in a damage suit under 11 U.S.C.
BURTON V. INFINITY CAPITAL MANAGEMENT 11
§ 362(k).1 Rather, the sole question in this appeal is whether
an attorney who drafts an order at the request of a judge is
entitled to absolute quasi-judicial immunity. We conclude
that he is not.
Absolute judicial immunity “insulates judges from
charges of erroneous acts or irregular action.” Castillo,
297 F.3d at 947 (citing Forrester v. White, 484 U.S. 219,
227–28 (1988)). Absolute immunity “is not reserved solely
for judges, but extends to nonjudicial officers for ‘all claims
relating to the exercise of judicial functions.’” Id. (quoting
Burns v. Reed, 500 U.S. 478, 499 (1991) (Scalia, J.,
concurring in part and dissenting in part)). “The Supreme
Court has been quite sparing in its recognition of absolute
immunity, and has refused to extend it any further than its
justification would warrant.” Id. (internal quotation marks
and alterations omitted). The justification for absolute
immunity is the protection of the judicial process. It shields
independent and impartial adjudication and prevents the
“deflection of [an officer’s] energies from his public duties.”
Burns, 500 U.S. at 485. The Supreme Court has “made it
clear that it is the interest in protecting the proper functioning
of the office, rather than the interest in protecting its
occupant, that is of primary importance.” Kalina v. Fletcher,
522 U.S. 118, 125 (1997).
Thus, we take a functional approach to determining
whether a nonjudicial officer is entitled to absolute quasi-
1
11 U.S.C. § 362(k)(1), under which this action was brought, provides
that, subject to certain exceptions, “an individual injured by any willful
violation of a stay provided by this section shall recover actual damages,
including costs and attorneys’ fees, and, in appropriate circumstances,
may recover punitive damages.”
12 BURTON V. INFINITY CAPITAL MANAGEMENT
judicial immunity by looking to “the nature of the function
performed and not to the identity of the actor performing it.”
Castillo, 297 F.3d at 948. To qualify for absolute immunity,
the function performed must be a judicial act with “a
sufficiently close nexus to the adjudicative process.” Id.
However, “it is only when the judgment of an official other
than a judge involves the exercise of discretionary judgment
that judicial immunity may be extended to that nonjudicial
officer.” Id. at 949. The Supreme Court established the
requirement for discretionary judgment in Antoine v. Byers &
Anderson, Inc., where it declined to extend the immunity to
court reporters because transcribing verbatim transcripts does
not involve the level of authoritative or “discretionary
decisionmaking that the doctrine of judicial immunity is
designed to protect.” 508 U.S. 429, 435 (1993). To be
protected, the function performed must “involve the exercise
of discretion in resolving disputes.” Castillo, 297 F.3d at 948
(citing Antoine, 508 U.S. at 435).
Before turning to the functional approach, we first inquire
into the immunity historically accorded attorneys. Id. We
have afforded quasi-judicial immunity to bankruptcy trustees
because they were exercising judgments while performing
acts closely related to the judicial process. Id. at 946–47; see
also Lonneker Farms, Inc. v. Klobucher, 804 F.2d 1096, 1097
(9th Cir. 1986) (holding that “a trustee in bankruptcy . . . is
entitled to derived judicial immunity because he is
performing an integral part of the judicial process”). For
similar reasons, we afforded United States Trustees quasi-
judicial immunity. Balser v. Dep’t of Justice, 327 F.3d 903,
910 (9th Cir. 2003). Absolute immunity has been extended
to attorneys for performing the duties of a prosecutor, Imbler
v. Pachtman, 424 U.S. 409, 431 (1976); Butz v. Economou,
438 U.S. 478, 517 (1978), but the Supreme Court has not
BURTON V. INFINITY CAPITAL MANAGEMENT 13
extended the immunity beyond the prosecutorial function.
Even court-appointed defense attorneys do not enjoy
immunity because despite being “officers” of the court,
“attorneys [are not] in the same category as marshals, bailiffs,
court clerks or judges.” Ferri v. Ackerman, 444 U.S. 193,
202 n.19 (1979). In Ferri, the Supreme Court declined to
extend immunity because “the primary office performed by
appointed counsel parallels the office of privately retained
counsel” where an attorney owes a duty to his client, not the
public. Id. at 204. This implied disinclination to grant
immunity to private counsel was solidified after the Supreme
Court concluded that “private actors are not entitled to the
absolute immunity granted to some government officials,
such as prosecutors and judges.” Kimes v. Stone, 84 F.3d
1121, 1128 (9th Cir. 1996) (citing Wyatt v. Cole, 504 U.S.
158, 164–65 (1992)).
Not only does this precedent forestall extending absolute
quasi-judicial immunity to Gugino, the functional approach,
which requires us to look past his identity as an attorney and
focus only on the function he performed, also denies Gugino
immunity. Although the function performed by Gugino had
a close nexus to the judicial process—he prepared the order
during a judicial proceeding, and orders are a basic and
integral part of judicial proceedings—preparing the order did
not involve the kind of discretionary judgment that is
protected by the doctrine.
Preparing an order on behalf of a court does require the
preparer to make important decisions about language and
tone, but the ultimate discretion in determining whether an
order will be integral to resolving a dispute lies with the
judge, not the preparer. Only the judge can exercise the
unique authority vested in him by signing an order of the
14 BURTON V. INFINITY CAPITAL MANAGEMENT
court. Because the judge must approve of an order before it
is filed and before it can affect the course of the judicial
proceeding, it cannot be said that simply preparing an order
involves the “substantial discretion” that results in absolute
immunity. See Castillo, 297 F.3d at 951.
Gugino argues that he is entitled to absolute immunity
because a law clerk would have been entitled to absolute
immunity for preparing the order. Although law clerks are
entitled to absolute immunity and certainly prepare orders, an
attorney cannot be compared to a law clerk, who is “probably
the one participant in the judicial process whose duties and
responsibilities are most intimately connected with the
judge’s own exercise of the judicial function.” Moore v.
Brewster, 96 F.3d 1240, 1245 (9th Cir. 1996) (internal
quotation marks omitted).
Gugino also contends he is entitled to absolute quasi-
judicial immunity because he was doing what Judge Israel
asked him to do. Other circuits have held that a function
undertaken pursuant to the explicit direction of a judge
entitles the subordinate to absolute immunity. Kincaid v.
Vail, 969 F.2d 594, 600–01 (7th Cir. 1992) (citing examples
from five circuits extending immunity for carrying out
judicial directives). We have previously held that court
clerks are entitled to absolute immunity even in the absence
of a judicial directive so long as the acts were not done “in
the clear absence of all jurisdiction.” Mullis v. United States
Bankruptcy Court for Dist. of Nev., 828 F.2d 1385, 1390 (9th
Cir. 1987). However, immunity was extended in all of those
cases to court officials, and Gugino is not a court official.
Additionally, the district court here characterized Gugino’s
action as one he volunteered to do. Gugino maintains that he
was directed to prepare the order, and Judge Israel’s minute
BURTON V. INFINITY CAPITAL MANAGEMENT 15
order stated that “the Court directed Counsel to prepare an
order for a show cause hearing.” Nevertheless, when we
view the transcript of the hearing in a light most favorable to
Burton and Koch, we resolve the inference in their favor.
Gugino responded when Judge Israel asked, “who wants to
prepare the order?” and, unlike the first status hearing,
Gugino did not voice any concern about preparing the order
in light of the bankruptcy.
Finally, Gugino argues that policy reasons support the
extension of absolute immunity here. He asserts that having
attorneys prepare orders preserves scarce judicial resources,
and that the practice would be inhibited if attorneys were
exposed to civil liability for doing so. Of course, nothing in
our holding necessarily subjects an attorney to liability. We
simply decline to extend the doctrine of absolute immunity.
Judicial economy does not provide a justification for altering
our case law. In addition, affording immunity to attorneys for
drafting orders might immunize improper actions where
attorneys did knowingly and wilfully violate the automatic
stay by presenting orders violating the stay to judges who
were not apprised of the bankruptcy filing.
IV
On the narrow question presented by this appeal, we
conclude that an attorney preparing an order for a judge is not
entitled to quasi-judicial immunity. We do not reach the
question of whether such an action violated the automatic
stay, or whether it was actionable under 11 U.S.C. § 362(k).
AFFIRMED.
16 BURTON V. INFINITY CAPITAL MANAGEMENT
GILMAN, Circuit Judge, dissenting:
The majority refuses to extend quasi-judicial immunity to
Salvatore Gugino, a private attorney, based on the majority’s
conclusion that Gugino performed a nondiscretionary act in
drafting a show-cause order at Judge Israel’s request. In so
concluding, I believe that the majority has not only
misapplied the precedents on point, but has produced a very
unfair result. I therefore respectfully dissent.
To begin with, the majority and I actually agree on a
number of key points. We agree, for example, that immunity
“is not reserved solely for judges, but extends to nonjudicial
officers for all claims relating to the exercise of judicial
functions.” In re Castillo, 297 F.3d 940, 947 (9th Cir. 2002)
(extending immunity to a Chapter 13 bankruptcy trustee)
(internal quotation marks omitted). And we agree that
immunity depends on “the nature of the function performed
and not [on] the identity of the actor performing it.” Id. at
948. Finally, we recognize that “absolute quasi-judicial
immunity will be extended to nonjudicial officers only if they
perform official duties that are functionally comparable to
those of judges, i.e., duties that involve the exercise of
discretion in resolving disputes.” Id.
But this is where my agreement with the majority ends.
The drafting of a show-cause order is not simply a
mechanical action comparable to court reporters transcribing
verbatim transcripts. See Antoine v. Byers & Anderson, Inc.,
508 U.S. 429, 436 (1993) (declining to extend immunity to
court reporters because they “are afforded no discretion in . . .
record[ing], as accurately as possible, what transpires in
court”). Even the majority acknowledges that “the function
performed by Gugino had a close nexus to the judicial
BURTON V. INFINITY CAPITAL MANAGEMENT 17
process,” that “orders are a basic and integral part of judicial
proceedings,” and that “[p]reparing an order on behalf of a
court does require the preparer to make important decisions
about language and tone.” Maj. Op. at 13.
Notwithstanding these acknowledgements, however, the
majority concludes (without citation to any authority) that
“preparing the order did not involve the kind of discretionary
judgment that is protected by the doctrine [of judicial
immunity].” Id. My problem with the majority’s analysis is
that it fails to recognize the fact that Gugino was in effect
acting as Judge Israel’s law clerk for the specific task at hand,
and that this court has previously held that law clerks are
entitled to quasi-judicial immunity. See Moore v. Brewster,
96 F.3d 1240, 1244–45 (9th Cir. 1996) (extending immunity
to a law clerk for alleged due process violations related to the
improper handling of a supersedeas bond).
Indeed, if we were to substitute a law clerk for Gugino
and assume that Judge Israel had directed the clerk to draft
the show-cause order in question, this court’s decision in
Moore would have immunized the clerk from liability
because the act of drafting a show-cause order directly relates
to “the independent and impartial exercise of judgment vital
to the judiciary.” See Castillo, 297 F.3d at 949. The
exercise-of-discretion requirement, in other words, is derived
from the judge who directs the task and should not be focused
solely on the drafter of the order. See Mullis v. Bankruptcy
Court of Dist. of Nev., 828 F.2d 1385, 1390 (9th Cir. 1987)
(explaining that immunity extends “from the judge who
appoint[s]” the person in question).
This point is crucial because Gugino’s identity as a
private attorney should not preclude the extension of
18 BURTON V. INFINITY CAPITAL MANAGEMENT
immunity. See Castillo, 297 F.3d at 948 (cautioning against
concentrating on the identity of the actor in immunity cases).
The majority to its credit agrees that we are required “to look
past his identity as an attorney and focus only on the function
he performed.” Maj. Op. at 13. But then the majority goes
astray by not recognizing that Gugino was in fact functioning
as a law clerk in carrying out Judge Israel’s directive to draft
the show-cause order that is the sole focus of this lawsuit.
And, as previously noted, a law clerk performing this task
would be entitled to quasi-judicial immunity. See Moore,
96 F.2d at 1244–45. So should Gugino.
Unfortunately, the majority elevates a hypothetical policy
concern to a rationale for declining to extend immunity on the
facts before us. As the majority reasons, extending immunity
in this case “might immunize improper actions where
attorneys did knowingly and willfully violate the automatic
stay by presenting orders violating the stay to judges who
were not apprised of the bankruptcy filing.” Maj. Op. at 15.
But those circumstances are clearly not present here. Gugino
simply obeyed a judicial directive from a state judge who was
fully apprised of the bankruptcy filing. His actions were
therefore neither self-initiated nor taken with the intent to
bamboozle an uninformed judge.
And this leads to my next point. The majority credits the
district court’s isolated and inconsistent characterization of
Gugino’s conduct as “volunteer[ing]” to prepare the show-
cause order. Id. at 10. But this is not a fair inference from
the record. At the hearing, Judge Israel explicitly stated: “I’m
going to issue an order to show cause,” and he then explained
the order’s specifics. Judge Israel followed this explanation
by asking “who wants to prepare the order?” He then
BURTON V. INFINITY CAPITAL MANAGEMENT 19
prompted a response by inquiring: “Mr. Gugino?” Gugino
responded: “I’ll prepare it, Your Honor.”
As is evident from this exchange, Gugino agreed to draft
the show-cause order after Judge Israel requested one of the
attorneys, and particularly Gugino, to do so. Thus, to say that
Gugino “volunteered,” without more, mischaracterizes the
record. All of the other record citations, in fact, support a
contrary conclusion, starting with Gugino’s statement in his
June 9, 2011 letter to Koch that “Judge Israel ordered that an
Order to Show Cause be issued against you, and he then
directed me to prepare the Order. This was not my idea, nor
did I recommend it to the Court.” Judge Israel’s own minute
entry confirms that the “Court directed Counsel to prepare an
order for a show cause hearing and Court set hearing.”
Even the district court twice found that Judge Israel
directed Gugino to draft the order. See Dist. Ct. Order at 3
(“Judge Israel ordered Gugino to draft an order to show cause
to be served on Koch.”) and id. at 14–15 (“Judge Israel acted
in excess of his jurisdiction when he . . . directed Gugino to
draft an order to show cause against Koch for failing to
interplead the settlement funds.”)
In light of this overwhelming record evidence, the district
court’s single inconsistent statement on page 12 of its Order
that “Gugino is not entitled to quasi-judicial immunity
because Gugino volunteered to prepare the order in direct
violation of the stay” is entitled to little weight. This is
especially so because the key point is the undisputed fact that
the show-cause order was initiated and directed by Judge
Israel, not by Gugino, whether or not the latter “volunteered.”
20 BURTON V. INFINITY CAPITAL MANAGEMENT
Moreover, the majority’s decision not to extend quasi-
judicial immunity to an officer of the court acting at the
behest of a judge is in conflict with every other federal
appellate court that has confronted the issue. See, e.g.,
Kincaid v. Vail, 969 F.2d 594, 601 (7th Cir. 1992) (noting the
“general agreement that court officials . . . who act at the
behest of a judge or pursuant to a court order are entitled to
absolute quasi-judicial immunity from suit as to those
actions”) (quoting Forte v. Sullivan, 935 F.2d 1, 3 (1st Cir.
1991)); Rogers v. Bruntrager, 841 F.2d 853, 856 (8th Cir.
1988) (explaining that clerks of court “have absolute
immunity from actions for damages arising from acts they are
specifically required to do under court order or at a judge’s
direction.”) (internal quotation marks omitted).
The reasoning underlying these cases is directly
applicable to this case; i.e., the fundamental unfairness of
holding liable those who carry out the orders of judges when
the judges themselves are absolutely immune. See Green v.
Maraio, 722 F.2d 1013, 1019 (2d Cir. 1983) (“[I]t would be
manifestly unfair to allow Maraio to be subjected to liability
when she was acting within the scope of the judge’s
instructions and was simply acting as an arm of the court in
compliance with the exercise of his judicial authority.”)
(emphasis omitted). Similarly, declining to extend immunity
to Gugino is fundamentally unfair when Judge Israel himself
enjoys immunity.
Finally, I cannot help but note that this entire dispute
could have been avoided if the attorneys involved had
exhibited greater collegiality and common sense. But their
communications in fact broke down, and this case resulted.
Now these events have produced a majority opinion that
unfortunately puts at risk the common practice of private
BURTON V. INFINITY CAPITAL MANAGEMENT 21
attorneys drafting proposed orders on behalf of a judge. For
all of the above reasons, I would reverse the judgment of the
district court and grant Gugino quasi-judicial immunity for
his actions in this case.