In Re Complaint of Judicial Misconduct

FILED
FOR PUBLICATION AUG 05 2014
MOLLY C. DWYER, CLERK
JUDICIAL COUNCIL U.S. COURT OF APPEALS
OF THE NINTH CIRCUIT
IN RE COMPLAINT OF No. 13-90031
JUDICIAL MISCONDUCT ORDER
KOZINSKI, Chief Judge:
Complainant, principal owner of a financial group, alleges that a bankruptcy
judge refused to appoint the group as an advisor in two bankruptcy cases due to
personal animus. Complainant claims that the animus arises out of a previous case
where the financial group was appointed as an advisor to the bankruptcy estate. In
that case, the judge entered multiple orders approving the financial group’s
appointment. Each of the orders included a monthly cap on the fees the financial
group was entitled to bill, but the group substantially exceeded these caps almost
every month it was retained. When it came time for the judge to approve the
group’s final fee application, he denied any fees in excess of the capped limits.
Then, in two subsequent cases, the judge cited the group’s failure to comply with
these orders as his reason for denying its appointment as advisor. The judge has
made it clear that he will not appoint the group in future cases.
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The decision whether to approve the appointment of a professional to deliver
services to a bankruptcy estate is a merits ruling that is not normally second-
guessed in a judicial misconduct proceeding. See Commentary to Judicial-
Conduct Rule 3 (“Any allegation that calls into question the correctness of an
official action of a judge—without more—is merits-related”); In re Complaint of
Judicial Misconduct, 583 F.3d 598, 598 (9th Cir. 2009) (“[C]laims [that] relate to
the merits of the judge’s rulings . . . must . . . be dismissed”). However, a merits
ruling may constitute misconduct if it is influenced by an invidious factor or an
impermissible motive. See Commentary to Judicial-Conduct Rule 3 (“[a]n
allegation that a judge ruled against the complainant because the complainant is a
member of a particular racial or ethnic group, or because the judge dislikes the
complainant personally” is cognizable as misconduct).
Complainant seeks to show impermissible motive by noting that the judge’s
fees order in the original case was reversed on appeal. In his view, the reversal
shows that the judge erred in imposing the fee caps and, therefore, the judge’s
unhappiness with the financial group’s failure to adhere to the caps is unreasonable
and constitutes personal animus. Complainant also points to the judge’s comments
following reversal and when he denied appointment in the two subsequent cases:
On all three occasions, the judge expressed chagrin that the financial group
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prevailed on appeal based on what the judge characterized as a technicality.
Before turning to the question of motive, I note that a judge’s public
comments can themselves constitute misconduct if they are sufficiently rude,
derogatory or intemperate. See Judicial-Conduct Rule 3(h)(1)(D) (“Misconduct
includes . . . treating litigants or attorneys in a demonstrably egregious and hostile
manner”). The comments here do not meet that standard. The judge did not use
demeaning language or heap abuse on anybody. His statements were blunt but
measured expressions of frustration with having his orders disregarded by someone
in whom he had placed confidence. For example, in one case where the judge
refused to appoint the financial group, he said, “Find somebody else. . . . There’s
no question in my mind that they violated [my] order [in a previous case]
regardless of what the BAP did. . . . I don’t have confidence in them.” In another
case he said, “I’ve had a history with them of them not following court orders in
my opinion and I’m not going to appoint [them]. . . . They violated [my order in a
previous case]. For technical reasons I got reversed, but I’m not hiring them in this
case. I have no confidence in their abilities.” These comments were not rude or
intemperate; they forthrightly reflected the judge’s lack of trust in the group based
on its prior conduct.
Nor do the judge’s comments reflect an impermissible motive. In making a
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discretionary appointment to a position of trust, a judge may rely on his own prior
experience with the applicants for the appointment. The judge’s refusal to appoint
the financial group in subsequent cases was consistent with his observation that it
had disregarded his orders in the past and he could therefore not trust them to
perform faithfully in the future. While the judge was reversed for basing his
decision on the wrong statutory provision, the reviewing court left open the
possibility that he could have limited the financial group’s fees, had he relied on a
different code section. The judge was thus justified in believing that his limitation
was substantively sound and should have been complied with by the financial
group. It was not misconduct, or even wrong, for the judge to consider the group’s
repeated refusal to abide by the financial limits he set in a past case in making
future appointments. Indeed, it would have been irresponsible for the judge to
disregard the group’s prior record.
Complainant’s allegations of misconduct are dismissed as unsupported. See
28 U.S.C. § 352(b)(1)(A)(iii); In re Complaint of Judicial Misconduct, 569 F.3d
1093, 1093 (9th Cir. 2009).
DISMISSED.