Stephen Yagman v Republic Insurance

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9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

-------------------------- Page 987 F.2d 622 follows ---------------------------

25 Fed.R.Serv.3d 717

Stephen YAGMAN, Plaintiff-Appellant,

REPUBLIC INSURANCE; CNA Insurance; Valley Forge Insurance,

Defendants-Appellees.

No. 91-55871.

United States Court of Appeals,

Ninth Circuit.

Argued and Submitted Oct. 8, 1992.

Decided March 4, 1993.

Attorney sought to recuse judge from hearing insurance action, in which

attorney was both plaintiff and counsel for himself, on ground that judge was

personally biased against attorney, as evidenced by events surrounding previous

trial in which attorney was counsel for plaintiffs and at which judge presided.

The United States District Court for the Central District of California, William

Duffy Keller, J., 136 F.R.D. 652,137 F.R.D. 310, denied recusal motion and

imposed sanctions on attorney, and attorney appealed. The Court of Appeals,

Hug, Circuit Judge, held that: (1) recusal was not warranted; (2) Rule 11

sanctions against attorney for his characterization, in recusal motion, of

judge's petition for certiorari, as judge "sued me personally," were not

warranted; and (3) district court's sanctioning of attorney pursuant to its

inherent powers, for alleged acts and omissions made during district court's

consideration of recusal motion, was not warranted.

Affirmed in part; vacated in part.

1. JUDGES k51(4)

227 ----

227IV Disqualification to Act

227k51 Objections to Judge, and Proceedings Thereon

227k51(4) Determination of objections.

C.A.9 (Cal.) 1993.

Recusal is appropriate where reasonable person with knowledge of all the

facts would conclude that judge's impartiality might reasonably be questioned.

28 U.S.C.A. Secs. 144, 455.

2. JUDGES k49(1)

227 ----

227IV Disqualification to Act

227k49 Bias and Prejudice

227k49(1) In general.

C.A.9 (Cal.) 1993.

Recusal of judge will be justified either by actual bias or appearance of

bias. 28 U.S.C.A. Secs. 144, 455.

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

3. FEDERAL COURTS k819

170B ----

170BVIII Courts of Appeals

170BVIII(K) Scope, Standards, and Extent

170BVIII(K)4 Discretion of Lower Court

170Bk819 Change of venue; disqualifying judge; continuance.

C.A.9 (Cal.) 1993.

Court of Appeals reviews district court's denial of recusal of judge for

abuse of discretion.

4. JUDGES k49(1)

227 ----

227IV Disqualification to Act

227k49 Bias and Prejudice

227k49(1) In general.

C.A.9 (Cal.) 1993.

Recusal of judge for judge's alleged personal bias against attorney was not

warranted by fact that in previous case Court of Appeals reversed judge's

sanction order against attorney and ordered that sanctions matter be reassigned,

on remand, to another judge; sanction order was reversed on procedural grounds

and case was reassigned to another judge, not because of any inability of judge

to act impartially, but instead to preserve appearance of justice in what had

become complicated and acrimonious case and nothing in Court of Appeals opinion

suggested that reassignment of sanctions issue would necessitate recusal of

judge from future matters in which attorney was involved. 28 U.S.C.A. Secs.

144, 455.

5. JUDGES k49(1)

227 ----

227IV Disqualification to Act

227k49 Bias and Prejudice

227k49(1) In general.

C.A.9 (Cal.) 1993.

Recusal of judge on ground that judge was allegedly personally biased against

attorney was not warranted by judge's failure to comply with Court of Appeals'

order, in previous case involving attorney, directing that sanctions matter, on

remand, be reassigned to another judge and by judge's filing of petitions for

certiorari challenging Court of Appeals' authority to order reassignment of case

and reassignment of another case not involving attorney.

6. FEDERAL CIVIL PROCEDURE k2774(4)

170A ----

170AXX Sanctions

170AXX(B) Grounds for Imposition

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

170Ak2767 Unwarranted, Groundless or Frivolous Papers or Claims

170Ak2774 Motions and Opposition Thereto

170Ak2774(4) Disqualification and recusal motions.

C.A.9 (Cal.) 1993.

Although attorney's characterization, in his motion to recuse judge, of

judge's previous petition for certiorari in case in which attorney was involved,

as judge "sued me personally," was careless and slovenly legal work, taken as

whole, recusal motion, which contained correct citation to petition for

certiorari, was not actually misleading, in that it plainly identified

controversy upon which attorney relied, and therefore, was not sanctionable

under Rule 11. Fed.Rules Civ.Proc.Rule 11, 28 U.S.C.A.

7. FEDERAL CIVIL PROCEDURE k2769

170A ----

170AXX Sanctions

170AXX(B) Grounds for Imposition

170Ak2767 Unwarranted, Groundless or Frivolous Papers or Claims

170Ak2769 Reasonableness or bad faith in general; objective or

subjective standard.

C.A.9 (Cal.) 1993.

Courts must apply objective test in assessing whether Rule 11 has been

violated. Fed.Rules Civ.Proc.Rule 11, 28 U.S.C.A.

8. FEDERAL CIVIL PROCEDURE k2769

170A ----

170AXX Sanctions

170AXX(B) Grounds for Imposition

170Ak2767 Unwarranted, Groundless or Frivolous Papers or Claims

170Ak2769 Reasonableness or bad faith in general; objective or

subjective standard.

C.A.9 (Cal.) 1993.

Violation of Rule 11 does not require subjective bad faith. Fed.Rules

Civ.Proc.Rule 11, 28 U.S.C.A.

9. FEDERAL COURTS k830

170B ----

170BVIII Courts of Appeals

170BVIII(K) Scope, Standards, and Extent

170BVIII(K)4 Discretion of Lower Court

170Bk830 Costs, attorney's fees and other allowances.

C.A.9 (Cal.) 1993.

Court of Appeals reviews district court's application of Rule 11 for abuse of

discretion. Fed.Rules Civ.Proc.Rule 11, 28 U.S.C.A.

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

10. FEDERAL CIVIL PROCEDURE k2774(4)

170A ----

170AXX Sanctions

170AXX(B) Grounds for Imposition

170Ak2767 Unwarranted, Groundless or Frivolous Papers or Claims

170Ak2774 Motions and Opposition Thereto

170Ak2774(4) Disqualification and recusal motions.

C.A.9 (Cal.) 1993.

District court's imposition of sanction, pursuant to its inherent powers, for

attorney's characterization, in his recusal motion, of judge's previous petition

for certiorari in case in which attorney was involved, as judge "sued me

personally," was not warranted, absent indication in record that attorney acted

in bad faith or intended to mislead court by his careless characterization of

petition.

11. FEDERAL CIVIL PROCEDURE k2757

170A ----

170AXX Sanctions

170AXX(A) In General

170Ak2756 Authority to Impose

170Ak2757 Inherent authority.

C.A.9 (Cal.) 1993.

Courts are endowed with inherent powers which are necessary to conduct of

their business, including power to sanction; however, because of their very

potency, inherent powers must be exercised with restraint and discretion.

12. FEDERAL CIVIL PROCEDURE k2757

170A ----

170AXX Sanctions

170AXX(A) In General

170Ak2756 Authority to Impose

170Ak2757 Inherent authority.

C.A.9 (Cal.) 1993.

Courts may not invoke inherent powers without specific finding of bad faith.

13. FEDERAL COURTS k830

170B ----

170BVIII Courts of Appeals

170BVIII(K) Scope, Standards, and Extent

170BVIII(K)4 Discretion of Lower Court

170Bk830 Costs, attorney's fees and other allowances.

C.A.9 (Cal.) 1993.

Court of Appeals reviews district court's sanction imposed under its inherent

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

power for abuse of discretion.

14. CONTEMPT k20

93 ----

93I Acts or Conduct Constituting Contempt of Court

93k19 Disobedience to Mandate, Order, or Judgment

93k20 In general.

C.A.9 (Cal.) 1993.

Criminal contempt sanction against attorney who sought recusal of judge,

because of judge's alleged personal bias against attorney, was not warranted by

fact that attorney disobeyed district court's order specifically requesting

attorney to produce complaint and all pleadings filed in case which was listed

in attorney's recusal motion; case listed in recusal motion was petition for

certiorari, and not civil lawsuit, and therefore, it was objectively impossible

for attorney to comply with terms of order and although law clerk may have

requested that attorney send copy of certiorari petition and attorney's response

thereto, this request was not part of court's order and therefore, could not

serve as basis for finding of contempt. 18 U.S.C.A. Sec. 401(3).

15. FEDERAL CIVIL PROCEDURE k2774(4)

170A ----

170AXX Sanctions

170AXX(B) Grounds for Imposition

170Ak2767 Unwarranted, Groundless or Frivolous Papers or Claims

170Ak2774 Motions and Opposition Thereto

170Ak2774(4) Disqualification and recusal motions.

C.A.9 (Cal.) 1993.

District court's sanction of attorney pursuant to its inherent powers for

attorney's failure to comply with court order directing attorney to produce

complaint and all pleadings filed in case, which was listed in his motion to

recuse judge, for judge's alleged personal bias against attorney, was not

warranted; case listed in recusal motion was petition for certiorari, and not

civil lawsuit, and therefore, it was objectively impossible for attorney to

comply with terms of order and although law clerk may have requested that

attorney submit certiorari petition and attorney's response thereto, this

request was not part of court's order and therefore, could not serve as basis

for sanction.

16. FEDERAL COURTS k813

170B ----

170BVIII Courts of Appeals

170BVIII(K) Scope, Standards, and Extent

170BVIII(K)4 Discretion of Lower Court

170Bk813 Allowance of remedy and matters of procedure in general.

C.A.9 (Cal.) 1993.

Court of Appeals reviews district court's invocation of contempt power for

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

abuse of discretion. 18 U.S.C.A. Sec. 401(3).

17. FEDERAL CIVIL PROCEDURE k2774(4)

170A ----

170AXX Sanctions

170AXX(B) Grounds for Imposition

170Ak2767 Unwarranted, Groundless or Frivolous Papers or Claims

170Ak2774 Motions and Opposition Thereto

170Ak2774(4) Disqualification and recusal motions.

C.A.9 (Cal.) 1993.

Fact that attorney did not provide documentary support for his motion to

recuse judge, on ground that judge was allegedly personally biased against

attorney, did not justify district court's sanction of attorney for allegedly

violating local district court rule requiring that factual contentions involved

in motion be presented upon declarations and other written evidence.

U.S.Dist.Ct.Rules C.D.Cal., Rules 7.1 et seq., 7.5.2, 27.1 et seq.

18. FEDERAL CIVIL PROCEDURE k921

170A ----

170AVII Pleadings and Motions

170AVII(I) Motions in General

170Ak921 In general.

C.A.9 (Cal.) 1993.

Plain meaning of local district court rule, providing that factual

contentions involved in any motion shall be presented and heard upon

declarations and other written evidence alone, is that motions will be

considered on basis of documentary evidence, rather than oral testimony, unless

judge otherwise orders; obvious purpose of rule is to limit nature and volume

of evidence which is offered in support of motion. U.S.Dist.Ct.Rules C.D.Cal.,

Rule 7.5.2.

19. FEDERAL CIVIL PROCEDURE k2774(1)

170A ----

170AXX Sanctions

170AXX(B) Grounds for Imposition

170Ak2767 Unwarranted, Groundless or Frivolous Papers or Claims

170Ak2774 Motions and Opposition Thereto

170Ak2774(1) In general.

C.A.9 (Cal.) 1993.

Fact that motion is inadequately supported does not justify sanctions under

local district court rule, unless motion is made in bad faith.

U.S.Dist.Ct.Rules C.D.Cal., Rules 7.1 et seq., 7.5.2, 27.1 et seq.

20. FEDERAL CIVIL PROCEDURE k2774(4)

170A ----

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

170AXX Sanctions

170AXX(B) Grounds for Imposition

170Ak2767 Unwarranted, Groundless or Frivolous Papers or Claims

170Ak2774 Motions and Opposition Thereto

170Ak2774(4) Disqualification and recusal motions.

C.A.9 (Cal.) 1993.

Motion filed by attorney to recuse judge from presiding over attorney's

reinstatement to the bar and motion filed by attorney seeking to recuse same

judge from presiding over civil action in which attorney was plaintiff/counsel

did not implicate kind of abuse local district court rule, requiring party to

inform court if pending motion has been previously ruled upon by another judge,

was enacted to prevent and therefore, sanction of attorney under rule for not

informing district court hearing civil action recusal motion of denial of

previous recusal motion was not warranted; although attorney may have used

similar arguments in motions, the two motions were filed in entirely unrelated

cases. U.S.Dist.Ct.Rules C.D.Cal., Rule 7.13.

21. FEDERAL CIVIL PROCEDURE k921

170A ----

170AVII Pleadings and Motions

170AVII(I) Motions in General

170Ak921 In general.

C.A.9 (Cal.) 1993.

Purpose of local district court rule, requiring party to inform court if

pending motion has been previously ruled upon by another judge, is to prevent

judge shopping for rulings on motions in same case; in other words, rule

creates disincentive for parties to refile unsuccessful motions in same action,

hoping to have them reconsidered by more amenable judge. U.S.Dist.Ct.Rules

C.D.Cal., Rule 7.13.

-------------------------- Page 987 F.2d 624 follows ---------------------------

Ramsey Clark and Lawrence W. Schilling, New York City, Stephen Yagman, Yagman

& Yagman, Venice, CA, for plaintiff-appellant.

Appeal from the United States District Court for the Central District of

California.

Before: HUG, FLETCHER, and BRUNETTI, Circuit Judges.

HUG, Circuit Judge:

Attorney Stephen Yagman appeals from two orders of the district court for the

Central District of California: (1) denying a motion to recuse Chief Judge

Manuel Real of that district from a case in which Yagman was both a party and

counsel for himself, and (2) imposing sanctions on Yagman for certain acts and

omissions made during the consideration of that motion.

The district court had jurisdiction under 28 U.S.C. Sec. 1332(a)(1). We

have jurisdiction

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

-------------------------- Page 987 F.2d 625 follows ---------------------------

under 28 U.S.C. Sec. 1291. We affirm the order denying recusal, but vacate

the order imposing sanctions.

BACKGROUND

This case arises from a motion by attorney Stephen Yagman to recuse Chief

Judge Manuel Real of the Central District of California from a case in which

Yagman was both plaintiff and counsel for himself. Judge William D. Keller of

the same court denied Yagman's recusal motion, Yagman v. Republic Ins., 136

F.R.D. 652, 658 (C.D.Cal.1991), and sanctioned him for his conduct during the

consideration of that motion, Yagman v. Republic Ins., 137 F.R.D. 310, 312

(C.D.Cal.1991). Because the events in this case are adequately chronicled in

these two orders, we review here only the most pertinent facts.

The underlying action is a civil suit brought by Yagman against four

insurance companies seeking damages for breach of contract, various state law

torts and bad faith. The complaint was filed on January 24, 1991 and the case

was assigned to Judge Real. On February 4, 1991, Yagman filed a motion to

recuse Judge Real from sitting in the case on the ground that he was biased

against Yagman. (FN1) Judge Real summarily referred the motion for random

reassignment. Judge Keller was chosen to hear the motion.

Yagman's argument for recusal was based solely upon the events during and

subsequent to a 1984 defamation trial, Brown v. Baden, in which Yagman served as

plaintiffs' attorney and over which Judge Real presided. The trial was marked

by numerous heated exchanges between Yagman and Judge Real. At the conclusion

of the trial, Judge Real imposed a $250,000 sanction on Yagman for his conduct

both before and during the trial.

Yagman appealed the sanction to this court, arguing that the sanction was

unjust, that Judge Real had demonstrated bias against him during the trial, and

that Judge Real therefore should have recused himself from presiding over the

sanctions proceeding. In re Yagman, 796 F.2d 1165 (9th Cir.), amended, 803

F.2d 1085 (9th Cir.1986), mandamus granted by Brown v. Baden, 815 F.2d 575 (9th

Cir.), cert. denied, Real v. Yagman, 484 U.S. 963, 108 S.Ct. 450, 98 L.Ed.2d

390 (1987). We vacated the sanction on various procedural grounds and remanded

the matter with an instruction requiring the reassignment of the sanctions issue

to another judge in order "to preserve the appearance of justice." In re

Yagman, 796 F.2d at 1188. We noted the tense nature of the trial, but held

that Judge Real had not demonstrated bias against Yagman and that he did not err

by failing to recuse himself. Id. at 1181-82.

Judge Real did not reassign the case but, instead, stayed the proceeding

pending the outcome of a mandamus petition he had filed challenging our

authority to order the reassignment of another case not involving Yagman. See

United States v. Sears, Roebuck & Co., 785 F.2d 777 (9th Cir.) (reversing and

remanding for assignment to a different judge), cert. denied, 479 U.S. 988, 107

S.Ct. 580, 93 L.Ed.2d 583 (1986). Though the Court denied the Sears petition,

Judge Real still did not reassign the case. We then issued a writ of mandamus

ordering reassignment, Brown v. Baden, 815 F.2d 575 (9th Cir.1987), and Judge

Real responded by filing an unsuccessful petition for certiorari with the United

States Supreme Court, Real v. Yagman, 484 U.S. 963, 108 S.Ct. 450, 98 L.Ed.2d

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

390 (1987) (petition denied).

Yagman now argues that Judge Real's conduct during the Brown trial and his

attempt to seek review of our decision reversing Yagman's sanction in that case

demand Judge Real's recusal in this case. Yagman made this argument to the

district court, but was denied his request. Yagman, 136 F.R.D. at 657-58. He

now appeals that denial. (FN2)

-------------------------- Page 987 F.2d 626 follows ---------------------------

In addition, the district court sanctioned Yagman for several instances of

purported misconduct during the consideration of the recusal motion. Yagman,

137 F.R.D. at 317. After receiving several declarations and holding a hearing

on the matter, the court issued an order which officially sanctioned Yagman and

urged that he be disciplined by the State Bar of California. Id. at 319.

Yagman appeals the sanction order as well.

II.

RECUSAL

[1][2][3][4][5] Yagman seeks recusal of Judge Real under 28 U.S.C.

Secs. 144 and 455. Section 144 provides a procedure for a party to recuse a

judge. Section 455 imposes an affirmative duty upon judges to recuse

themselves. Under both statutes, recusal is appropriate where "a reasonable

person with knowledge of all the facts would conclude that the judge's

impartiality might reasonably be questioned." In re Yagman, 796 F.2d at 1179

(applying section 455); see also United States v. Conforte, 624 F.2d 869,

880-81 (9th Cir.) (discussing standard for disqualification under sections 144

and 455), cert. denied, 449 U.S. 1012, 101 S.Ct. 568, 66 L.Ed.2d 470 (1980).

Accordingly, recusal will be justified either by actual bias or the appearance

of bias. Preston v. United States, 923 F.2d 731, 734 (9th Cir.1991). We

review a district court's denial of recusal for an abuse of discretion. United

States v. Monaco, 852 F.2d 1143, 1147 (9th Cir.1988), cert. denied, 488 U.S.

1040, 109 S.Ct. 864, 102 L.Ed.2d 988 (1989).

The essence of Yagman's argument is that Judge Real's behavior during the

Brown v. Baden trial and his petition for certiorari to review our decision

regarding the sanction imposed against Yagman suggest that Judge Real, in truth

and in appearance, is biased against Yagman.

In In re Yagman we found that although Judge Real and Yagman "clashed

several times" during the Brown v. Baden trial, these incidents did not

necessitate Judge Real's recusal. In re Yagman, 796 F.2d at 1181. After

reversing Judge Real's sanction order on various procedural grounds, however, we

ordered that the sanctions matter be reassigned to another judge on remand. We

did so not because of any inability of Judge Real to act impartially, but

instead "to preserve the appearance of justice" in what had become a complicated

and acrimonious case. Id. at 1188.

Because we remanded the sanctions issue and ordered its reassignment to

another judge, Yagman reads our holding in In re Yagman as an acknowledgment

that Judge Real had created the appearance of bias during the Brown v. Baden

trial. We disagree. We "firmly rejected Yagman's claims of judicial bias" and

ordered reassignment only because we found "unusual circumstances." Id. The

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

attorney bickering and misconduct during the trial, the massive sanction award,

the numerous allegations of bias, and the poor lawyering demonstrated throughout

the case persuaded us that the matter would be better handled by another judge.

Id. Moreover, nothing in our opinion suggested that the reassignment of the

sanctions issue in that case would necessitate the recusal of Judge Real from

future matters in which Yagman was involved. Therefore, the events of the Brown

v. Baden trial, which we previously considered in In re Yagman, will not support

recusal in this case.

Likewise, Judge Real's failure to comply with this court's orders in In re

Yagman and his filing of a petition for certiorari in that case will not support

recusal in this case. Yagman suggests that Judge Real's petition was motivated

by some invidious motive against Yagman. His assertions, however, are nothing

more than speculation. Yagman has pointed to no evidence other than Judge

Real's pursuit of the petition for certiorari itself which would substantiate

his claim of actual or apparent bias. (FN3) The fact that Judge Real had filed

-------------------------- Page 987 F.2d 627 follows ---------------------------

similar petition in the Sears case, in which Yagman was not involved, suggests

that Judge Real was legitimately interested in challenging this court's

authority to order the reassignment of cases.

We conclude, therefore, that the district court did not abuse its discretion

by denying Yagman's motion to recuse Judge Real. We affirm the order denying

the motion, to the extent it addresses this issue. (FN4)

III.

SANCTIONS

The district court issued an order, after hearings on the sanctions matter,

which stated:

IT IS HEREBY ORDERED that Stephen Yagman is sanctioned under Rule 11 of

the Federal Rules of Civil Procedure, 18 U.S.C. Sec. 401(3), and the

inherent power of the Court.

A copy of this Order and the Order of March 27, 1991 shall be sent to the

State Bar of California with a recommendation that Stephen Yagman be

disciplined appropriately.

Yagman v. Republic Ins., 137 F.R.D. at 319. The district court based its

sanction order on three different instances of purported misconduct by Yagman:

(A) his characterization of the certiorari petition, Real v. Yagman, in his

recusal motion; (B) his response to the court's order requesting documents

regarding that action; and (C) his failure to call the court's attention to a

recusal motion he had made against Judge Real in an unrelated matter. Id. at

314-17.

"For a sanction to be validly imposed, the conduct in question must in fact

be sanctionable under the authority relied upon." United States v.

Stoneberger, 805 F.2d 1391, 1392 (9th Cir.1986). Accordingly, our analysis

considers whether each of these factual bases supports the imposition of

sanctions under the legal authorities cited by the district court.

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

[6] The district court sanctioned Yagman, in part, because of his

characterization of Judge Real's certiorari petition, Real v. Yagman, in

Yagman's recusal motion. Yagman's initial declaration in support of that motion

read in relevant part:

3. It is common knowledge, that from May 1984 until at least December 1987,

Judge Real and I were involved against one another in a bitter and

hard-fought controversy. As the culmination of that controversy, Judge Real

sued me personally in the United States Supreme Court by seeking a writ of

certiorari, in a case titled Manuel L. Real, etc. v. Stephen Yagman, No.

87-250. He was represented by counsel, not the United States Attorney, but

Joseph Ball, and I was represented by counsel, Ramsey Clark. The petition

for certiorari was denied. 484 U.S. 963, 108 S.Ct. 450, 98 L.Ed.2d 390

(1987).

The district court took issue with Yagman's statement "Judge Real sued me

personally...."

The district court apparently interpreted Yagman's statement to mean that

Judge Real had at one time brought a private legal action against Yagman.

Because Judge Real has never maintained such a suit, the district court

concluded that Yagman's statement was unsupportable and his subsequent failure

to clarify it misleading. The court sanctioned Yagman for this conduct under

Federal Rule of Civil Procedure 11 ("Rule 11") and the inherent power of the

court.

-------------------------- Page 987 F.2d 628 follows ---------------------------

Rule 11 requires an attorney to sign a document submitted to the court and

thereby attest that the document is "well grounded in fact ... warranted by

existing law ... and that it is not interposed for any improper purpose, such as

to harass or to cause unnecessary delay or needless increase in the cost of

litigation." Fed.R.Civ.P. 11. The rule requires a court to sanction an

attorney for a violation of its provisions. Id.

[7][8][9] Courts must apply an objective test in assessing whether the

rule has been violated. Zaldivar v. City of Los Angeles, 780 F.2d 823, 829-32

(9th Cir.1986), abrogated on other grounds, 496 U.S. 384, 110 S.Ct. 2447, 110

L.Ed.2d 359 (1990). A violation of the rule does not require subjective bad

faith. Id. We review a district court's application of Rule 11 for an abuse

of discretion. Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 405, 110 S.Ct.

2447, 2460-61, 110 L.Ed.2d 359 (1990); United States ex rel. Robinson

Rancheria Citizens Council v. Borneo, Inc., 971 F.2d 244, 248 (9th Cir.1992).

"A district court would necessarily abuse its discretion if it based its ruling

on an erroneous view of the law or on a clearly erroneous assessment of the

evidence." Cooter & Gell, 496 U.S. at 405, 110 S.Ct. at 2461.

The district court held that Yagman's statement "Judge Real sued me

personally" was supported neither by fact nor by law and was, therefore, a

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

violation of Rule 11. Read in isolation, the statement might have meant what

the district court assumed it to mean: that Judge Real and Yagman had been

involved in a private legal dispute. Looking at the entire motion in which the

statement was contained, however, it is clear that the statement does not mean

that. The motion explicitly identifies the controversy as Real v. Yagman,

which was a petition for certiorari to the Supreme Court, and the motion gives

the proper citation. Because Judge Real could not have brought such a suit by

filing a petition for certiorari in the United States Supreme Court, it is

apparent that Yagman was not describing a private lawsuit.

Judge Real's petition for certiorari was carelessly described, but the

citation to the legal action specified was given. It was a legal proceeding

that could have seriously affected Yagman's rights. By filing the petition,

Judge Real sought review of an opinion which vacated his $250,000 sanction

against Yagman and ordered the recusal of Judge Real from the matter. We

conclude that Yagman's characterization of the petition for certiorari was

careless and slovenly legal work. However, taken as a whole, the motion which

contained the correct citation to the petition for certiorari was not actually

misleading. It plainly identified the controversy upon which Yagman relied. It

was not sanctionable under Rule 11.

[10] The district court further held that Yagman was sanctionable under the

inherent power of the court for his failure to clarify or substantiate his

description of Real v. Yagman once it had been presented in the motion.

[11][12][13] Courts are endowed with inherent powers which are necessary

to the conduct of their business, including the power to sanction. Roadway

Express, Inc. v. Piper, 447 U.S. 752, 764, 100 S.Ct. 2455, 2463, 65 L.Ed.2d 488

(1980). However, "[b]ecause of their very potency, inherent powers must be

exercised with restraint and discretion." Chambers v. Nasco, --- U.S. ----,

111 S.Ct. 2123, 2132, 115 L.Ed.2d 27 (1991) (citations omitted). Courts may not

invoke these powers without a "specific finding of bad faith." Stoneberger,

805 F.2d at 1393 (citation omitted). We review a district court's sanction

under this legal theory for an abuse of discretion. Chambers, --- U.S. at

----, 111 S.Ct. at 2138.

The district court held that Yagman's failure to clarify his statement was in

bad faith and therefore sanctionable. It is clear that Yagman's motion was

based upon Judge Real's petition for certiorari to the Supreme Court. There is

no indication in the record before us that Yagman acted in bad faith or intended

to mislead the court by his careless characterization of the

-------------------------- Page 987 F.2d 629 follows ---------------------------

petition. Accordingly, a sanction based upon the court's inherent power is not

sustainable here.

[14][15] The district court also sanctioned Yagman for disobedience of a

March 19, 1991 minute order. The court order required Yagman to produce within

three days "the complaint and all pleadings" filed in Real v. Yagman. Yagman

did not provide these documents, but instead filed a timely response, which

read:

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

1. There is no complaint and there are no pleadings in that case, and

therefore, it is impossible to submit those materials to the Court.

2. Plaintiff herein is not in possession of "true cop[ies]" of materials in

that case.

Despite the fact that its order did not specifically request the certiorari

petition, the district court concluded that Yagman disobeyed the order by filing

this response and by failing to produce a copy of the petition for certiorari.

The district court's law clerk read the order to Yagman by telephone on the

day it was filed. Though the order specifically requested a "complaint" and

"pleadings," the law clerk suggested that the court really sought a copy of

Judge Real's certiorari petition and Yagman's response. In the court's view,

Yagman knew which documents it sought, but nonetheless evaded compliance. The

court apparently sanctioned him for this conduct under 18 U.S.C. Sec. 401(3)

(the federal contempt power), its inherent power, and Local Rule 7.5.2.

[16] Section 401(3) authorizes courts to punish individuals for contempt:

"A court of the United States shall have power to punish by fine or

imprisonment, at its discretion, such contempt of its authority and none other,

as-- ... (3) Disobedience or resistance to its lawful writ, process, order,

rule, decree, or command." 18 U.S.C. Sec. 401(3). "The criminal contempt

power enables judges to fine or imprison persons who willfully violate court

orders. Intent is an essential element that must be proved beyond a reasonable

doubt." Federal Trade Comm'n v. American Nat'l Cellular, 868 F.2d 315, 321

(9th Cir.1989). We review a district court's invocation of the contempt power

for an abuse of discretion. Gifford v. Heckler, 741 F.2d 263, 266 (9th

Cir.1984).

We conclude that section 401(3) does not support the district court's

sanction of Yagman because we are not persuaded that Yagman intentionally

disobeyed the court's order. The order specifically requested a complaint and

pleadings which did not exist. Real v. Yagman was a petition for certiorari,

not a civil lawsuit. It was objectively impossible for Yagman to comply with

the terms of the written order. Though the court's law clerk may have requested

other documents, this request was not part of the court's order and therefore

cannot serve as the basis for a finding of contempt. Whether the district court

did, or even intended to, invoke the criminal contempt power is doubtful.

However, in light of our conclusion, we need not address this question.

Additionally, because we believe that Yagman did not disobey the terms of the

court's order, we conclude that the court's sanction of Yagman under the court's

inherent power is also an abuse of discretion.

[17] The district court also held that Yagman's failure to produce the

certiorari petition and other documents was a violation of Local Rule 7.5.2.

The entire rule states:

Factual contentions involved in any motion and opposition to motions shall be

presented, heard, and determined upon declarations and other written evidence

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

(including documents, photographs, deposition excerpts, etc.) alone, except

that the Court may, in its discretion, require or allow oral examination of

any declarant or any other witness.

Local Rule 7.5.2.

Under the terms of Local Rule 7 as a whole, failure to comply with its

provisions

-------------------------- Page 987 F.2d 630 follows ---------------------------

is sanctionable under Local Rule 27. The district court interpreted Local Rule

7.5.2 to mean that under penalty of sanction, all motions must be sufficiently

supported. Because Yagman had not provided the certiorari petition or provided

other documentary support for his motion, the court concluded that he had

violated the rule.

[18] Though we normally accord a district court a "large measure of

discretion in interpreting and applying its own local rules," Los Angeles

Memorial Coliseum Comm'n v. City of Oakland, 717 F.2d 470, 473 (9th Cir.1983)

(citation omitted), the court's interpretation and application of Rule 7.5.2 in

this case require reversal. The plain meaning of the rule is that motions will

be considered on the basis of documentary evidence, rather than oral testimony,

unless the judge otherwise orders. The obvious purpose of the rule is to limit

the nature and volume of evidence which is offered in support of a motion.

[19] The district court supports its interpretation of the rule by

underscoring that part of the rule which states that "factual contentions ...

shall be presented...." The court suggests that the obligatory nature of this

language imposes an affirmative duty upon moving parties to support

satisfactorily their motions with evidence. We are not persuaded. Normally,

the consequence of an inadequately supported motion is that the movant loses.

This lack of support does not justify sanctions, unless the motion is made in

bad faith. We conclude that the court's sanction on this ground is therefore

not sustainable.

[20] The district court's final ground for sanctioning Yagman was his

failure to notify the court of a prior motion in which he unsuccessfully sought

the recusal of Judge Real because of the same allegations of bias which he

alleged in this case. The court concluded that Yagman's failure to do so was a

violation of Local Rule 7.13, which requires a party to inform the court if a

pending motion has been previously ruled upon by another judge. (FN5)

On August 28, 1989, following a six-month suspension by the California

Supreme Court, Yagman filed a motion with the Central District for reinstatement

to the bar of that court, pursuant to local rules. The reinstatement motion was

assigned to Judge Real. Yagman subsequently filed a motion to recuse Judge Real

from considering his reinstatement. Yagman's recusal request was heard by Judge

John G. Davies and denied. During the consideration of the instant matter,

Yagman did not inform the district court of his previous recusal motion in the

other proceeding.

Notwithstanding our deference to the district court, we must disagree with

its application of Local Rule 7.13 in this case. According to the rule, "if any

motion ... has been made to any judge of this Court" the moving party must

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

notify the judge if the party files "any subsequent motion for the same relief

in whole or in part...." Local Rule 7.13 (emphasis added). We are not

persuaded that Yagman sought in this recusal motion the "same relief" which he

sought in the previous one. Though Yagman may have used similar arguments in

each of these motions, the two motions

-------------------------- Page 987 F.2d 631. follows --------------------------

were filed in entirely unrelated cases. In the first case, Yagman sought the

recusal of Judge Real from Yagman's reinstatement proceeding. In the present

case, Yagman sought Judge Real's recusal from a civil action in which Yagman was

plaintiff and counsel.

[21] The obvious purpose of Rule 7.13 is to prevent judge shopping for

rulings on motions in the same case. In other words, the rule creates a

disincentive for parties to refile unsuccessful motions in the same action,

hoping to have them reconsidered by a more amenable judge. Yagman's filing of a

recusal motion in two different and unrelated cases does not implicate this kind

of abuse. For these reasons, we conclude that the district court abused its

discretion by sanctioning Yagman under Local Rule 7.13.

IV.

CONCLUSION

The denial of Yagman's recusal motion in this case is affirmed. The

sanctions against Yagman are vacated. Yagman will bear his own costs in this

appeal.

AFFIRMED in part, VACATED in part.

FN1. The insurance company/defendants in the underlying action did not appear

in conjunction with this motion, nor were they at all involved in the events

surrounding its consideration.

FN2. Prior to bringing this appeal, Yagman filed an emergency petition for writ

of mandamus, ordering the recusal of Judge Real. We denied the petition.

(No. 91-70209, April 12, 1991).

FN3. In his emergency petition for writ of mandamus to this court, Yagman

included numerous newspaper articles describing the events of the Brown case

and the Real v. Yagman petition. These articles were not presented to the

district court during the consideration of the recusal motion and they were

not provided in conjunction with this appeal. Though Yagman asks us to take

judicial notice of them, we decline to do so. We note, moreover, that the

articles do not support Yagman's claim of bias on the part of Judge Real.

Instead, they merely reverberate Yagman's own animosity for the judge.

FN4. The district court's order denying Yagman's motion for recusal also

includes an order to show cause why Yagman should not be sanctioned, and a

preliminary discussion of the grounds upon which he would be sanctioned.

Yagman, 136 F.R.D. at 656. In the following discussion, we vacate the

subsequent order which actually imposed sanctions on him. Accordingly, to

the extent which the district court's recusal order provides the basis upon

which Yagman was ultimately sanctioned, we reverse it.

FN5. Rule 7.13 provides:

9th Circ. Rptr., 801 F.2d- 987 F.2d 622, Yagman v. Republic Ins., (C.A.9

(Cal.) 1993)

If any motion, application or petition has been made to any judge of this

Court and has been denied in whole or in part or has been granted

conditionally or on terms, any subsequent motion for the same relief in whole

or in part, whether upon the same or any allegedly different state of facts,

shall be presented to the same judge whenever possible. If presented to a

different judge, it shall be the duty of the moving party to file and serve a

declaration setting forth the material facts and circumstances as to each

prior motion, including the date and judge involved in the prior motion, the

ruling, decision, or order made, and the new or different facts or

circumstances claimed to exist which did not then exist or were not shown

upon such prior motion. Any failure to comply with the foregoing

requirements shall be the basis for setting aside any order made on such

subsequent motion, either sua sponte or on motion or application, and the

offending party or attorney may be subject to the sanctions provided by Local

Rule 27.