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Docket Number

No. 00-13904 Non-Argument Calendar.

Advocates

Jack Massengale, Kenneth Massengale, Washington, DC, pro se. Neil Kolner, Attorney at Law, Sheriff of Dade County, Clerk of Courts, Miami, FL, pro se.

Judges

Edward Earl Carnes
Stanley Marcus
Charles R. Wilson

Acts

Government Organization And Employees — Administrative Procedure — Administrative Procedure — The Agencies Generally — Public Information; Agency Rules, Opinions, Orders, Records, And Proceedings
The Public Health And Welfare — Civil Rights — Generally — Proceedings In Vindication Of Civil Rights

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Smart Summary

Summary of Opinion: Massengale v. Ray, No. 00-13904 (11th Cir. Oct. 4, 2001)

Factual and Procedural Background

Jack Massengale, as trustee for his minor son Kenneth Massengale, filed a federal diversity action alleging unlawful acquisition of property against multiple defendants, including Michael Ray and Neil Kolner. Massengale filed an amended complaint and later a second-amended complaint. Kolner moved to dismiss; the district court initially denied that motion. Massengale amended again; the district court found the second-amended complaint failed to state a cause of action but allowed an opportunity to refile more clearly.

Before the district court granted Massengale leave to amend, Kolner filed a Rule 11 motion for sanctions, alleging harassment, lack of evidentiary support and legal merit, and that Massengale continued to practice despite disbarment. A magistrate judge recommended denial of the sanctions motion citing lack of compliance with Rule 11's safe-harbor and the district court's earlier denial of Kolner's motion to dismiss. The district court reversed that recommendation, finding Kolner had satisfied the safe-harbor and remanded the sanctions issue.

Massengale refiled his second-amended complaint; Kolner moved again to dismiss, asserting various pleading defects and procedural failings. The district court granted Kolner's motion, dismissed the action with prejudice, and gave Massengale limited opportunities to amend which Massengale did not satisfy. Kolner then sought reinstatement of his pending Rule 11 motion; the district court reinstated it and remanded for consideration because the alleged conduct predated the dismissal.

After a hearing the magistrate judge recommended granting sanctions and found Massengale had not shown his filings were made in good faith or supported by facts or law. The magistrate judge recommended a sanction that would compensate Kolner for attorney's fees, and—based on Kolner's testimony—determined $25,000 was a reasonable fee amount and adequate deterrence. The district court adopted that recommendation and awarded $25,000 in Rule 11 sanctions to Kolner. Massengale appealed.

Legal Issues Presented

Whether a pro se litigant may be awarded attorneys' fees as sanctions under Federal Rule of Civil Procedure 11.
Whether the district court properly exercised its discretion in awarding $25,000 in attorney's fees to a defendant who proceeded pro se (and was himself a lawyer) as a Rule 11 sanction for Massengale's filings.

Arguments of the Parties

Appellants (Jack and Kenneth Massengale)

The district court erred in awarding $25,000 in sanctions to Kolner measured as attorneys' fees because Kolner represented himself; Massengale contends a pro se litigant is not entitled to fees for his own legal work.
Kolner failed to provide evidence demonstrating that the challenged filings: (1) had no reasonable factual basis, (2) were based on a legal theory with no reasonable chance of success, or (3) were filed in bad faith or for an improper purpose.
The prior litigation cited by Kolner as evidence of Massengale's bad faith was irrelevant to the instant case.
Kolner presented no evidence to support his claim that he spent over 200 hours and incurred $25,000 in fees defending the case.

Appellee (Neil Kolner)

Kolner argued Massengale's pleadings were filed to harass and cause unnecessary delay.
Kolner contended Massengale's claims lacked evidentiary support and were unsupported by existing law.
Kolner asserted Massengale continued to practice law despite having been disbarred.
In motions to dismiss Kolner argued the complaint failed to allege sufficient facts for diversity jurisdiction, failed to cite relevant Florida or federal law, failed to join an indispensable party, and asserted claims against dismissed defendants.
Kolner relied on prior district court orders and his motion to dismiss as support for his Rule 11 sanctions motion and sought an award measuring the sanction by attorney's fees he incurred (he sought $25,000).

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Baker v. Alderman, 158 F.3d 516, 521 (11th Cir. 1998)	Standard of review: district court's award of Rule 11 sanctions is reviewed for abuse of discretion.	The court cited Baker to frame the appellate standard—abuse of discretion—for reviewing the district court's Rule 11 sanctions decision.
Worldwide Primates, Inc. v. McGreal, 87 F.3d 1252, 1254 (11th Cir. 1996)	Definition of when Rule 11 sanctions are properly assessed (three alternative bases: no reasonable factual basis; legal theory with no reasonable chance of success; filed in bad faith or for improper purpose).	The court relied on Worldwide Primates to identify the permissible bases for imposing Rule 11 sanctions and to evaluate whether Massengale's filings fit those categories.
Donaldson v. Clark, 819 F.2d 1551, 1556-57 (11th Cir. 1987) (en banc)	Explains Rule 11's deterrent purpose and that selection of the type of sanction is within the district court's discretion.	The opinion invoked Donaldson to explain Rule 11's goals (discouraging frivolous filings) and to acknowledge district court discretion in selecting sanctions; it used this to frame whether the district court abused its discretion.
Aetna Ins. Co. v. Meeker, 953 F.2d 1328, 1334 (11th Cir. 1992)	Sanctions under Rule 11 may be imposed for deterrence, compensation, and punishment; type and amount require proper exercise of discretion.	The court cited Aetna to support the proposition that sanctions may serve several purposes and that their type/amount implicate district court discretion in the Rule 11 context.
Kay v. Ehrler, 499 U.S. 432, 111 S.Ct. 1435, 113 L.Ed.2d 486 (1991)	Supreme Court rule that a pro se litigant cannot be awarded attorneys' fees under 42 U.S.C. § 1988 because the statute's policy is to encourage retention of independent counsel.	The court used Kay as the Supreme Court authority demonstrating that fee-shifting statutes aimed at encouraging counsel retention should not be read to award attorneys' fees to pro se litigants; this informed the Ray discussion and the court's reasoning about awarding fees to pro se litigants under other provisions.
Ray v. U.S. Dep't of Justice, 87 F.3d 1250 (11th Cir. 1996)	Eleventh Circuit decision applying Kay: a pro se litigant who is also a lawyer may not recover attorneys' fees under the FOIA fee-shifting provision (5 U.S.C. § 552(a)(4)(E)); emphasized that fees a lawyer charges himself are not truly "attorney's fees."	The court relied on Ray for the proposition that where a litigant represents himself, legal fees are not properly characterized as attorney's fees because no independent counsel was hired; the court applied Ray to conclude Rule 11 does not permit awarding attorney's fees to a pro se litigant.
Massengale v. Ray, No. 99-4313, 210 F.3d 393 (11th Cir. Feb. 15, 2000) (unpublished table decision)	Affirmance of the district court's dismissal of Massengale's action with prejudice (as noted in the opinion's background).	The opinion notes this earlier affirmance in the procedural history to explain prior appellate treatment of the district court's dismissal of Massengale's complaint with prejudice.

Court's Reasoning and Analysis

The court proceeded in a series of analytical steps rooted in Rule 11 doctrine and prior precedent:

Standard of review: The court stated that an award of Rule 11 sanctions is reviewed for abuse of discretion (citing Baker v. Alderman).
Identification of Rule 11 bases: The court recalled the three situations in which Rule 11 sanctions are properly assessed—no reasonable factual basis, no reasonable chance of success on the legal theory, or filing in bad faith—for evaluating whether sanctions were warranted (citing Worldwide Primates).
Purposes of sanctions and discretion: The court emphasized that Rule 11 sanctions serve deterrence, compensation, and punishment, and that the type and amount of sanction are within the district court's discretion (citing Donaldson and Aetna).
Central legal question — fees to pro se: The court examined whether Rule 11 permits awarding attorney's fees to a pro se litigant. It considered Ray v. U.S. Dep't of Justice (which applied the Supreme Court's Kay decision to FOIA fees), noting Kay's policy concern—fee-shifting statutes are intended to encourage retention of independent counsel and thus should not award fees to pro se litigants.
Distinction and conclusion: The court explained that Rule 11's policy objectives differ from those underlying fee-shifting statutes like § 1988 and FOIA; however, it concluded that Rule 11's text and purpose nevertheless do not permit awarding an attorney's-fee-style sanction to a pro se litigant because a pro se litigant has not incurred attorney's fees as an expense. The court quoted Ray's observation that fees a lawyer charges himself are not, strictly speaking, attorney's fees and that a self-represented lawyer did not hire an independent attorney whose fees could properly be recovered as costs of litigation.
Application to this case: Using that reasoning, the court held that the district court erred in awarding $25,000 in attorneys' fees to Kolner, who represented himself, because such an award violated the plain language of Rule 11 and constituted an abuse of discretion.
Reservation (footnote): The court noted Kolner framed his requested sanction as attorney's fees rather than as recovery for lost income from time away from practice; the court expressly reserved the question whether a pro se litigant (lawyer or nonlawyer) could recover a Rule 11 sanction measured by lost income, leaving that for future decision.
The court nonetheless agreed with the district court's finding that Massengale violated Rule 11 and observed that the district court retains discretion to impose appropriate sanctions serving Rule 11's deterrent purpose, subject to the limitation that attorney's fees may not be awarded to a pro se litigant.

Holding and Implications

Holding:

VACATED the district court's order imposing sanctions measured as an award of attorneys' fees to the pro se defendant (Kolner), and REMANDED the case to the district court for further proceedings consistent with this opinion.

Implications and consequences:

The Eleventh Circuit affirmed the district court's conclusion that Massengale violated Rule 11, so Massengale remains subject to Rule 11 sanctions in principle.
The specific sanction awarding $25,000 in attorneys' fees to Kolner (a pro se litigant who is himself a lawyer) was vacated because a pro se litigant cannot properly be awarded attorney's fees under Rule 11—the court reasoned a pro se litigant has not incurred attorney's fees as an expense and therefore the plain language of Rule 11 does not authorize such an award in these circumstances.
On remand, the district court may consider and impose other appropriate sanctions within its discretion to serve deterrent, compensatory, or punitive purposes, but it may not impose a sanction consisting of payment of attorney's fees to a pro se litigant in the form awarded below.
The court expressly reserved the separate question whether a pro se litigant could obtain a Rule 11 sanction measured by lost income (the income lost by taking time away from practice), leaving that issue for future decision.

Note: This summary is based exclusively on the content of the provided opinion and does not add material beyond what the court stated in the opinion.

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Jack MASSENGALE, Kenneth Massengale, Plaintiffs-Appellants, v. Michael RAY, Neil Kolner, et al., Defendants-Appellees.

PER CURIAM:

The precise issue in this case is apparently one of first impression in any circuit — whether a pro se litigant may be awarded attorneys' fees as sanctions under Federal Rule of Civil Procedure 11.

Jack and Kenneth Massengale ("Massengale") appeal the district court's order imposing sanctions against them, pursuant to Rule 11, in their pro se federal diversity action for unlawful acquisition of property. Massengale argues that the district court erred in awarding $25,000 in sanctions to Neil Kolner, a pro se defendant who also is a lawyer, based on the value of attorneys' fees Kolner incurred in defending the suit. Massengale argues that Kolner is not entitled to fees for his own legal work. Massengale also argues that Rule 11 sanctions were not appropriate because Kolner failed to provide the district court with evidence that Massengale's case or pleadings (1) had no reasonable factual basis, (2) were based on a legal theory that had no reasonable chance of success, or (3) were filed in bad faith or for an improper purpose. He also asserts that the prior litigation cited by Kolner as evidence of Massengale's history of bad faith was irrelevant to the instant case. Finally, Massengale argues that Kolner presented no evidence to support his contention that he spent over 200 hours and incurred $25,000 in fees defending the case.

BACKGROUND

Jack Massengale, as a trustee for his minor son, Kenneth Massengale, filed a federal diversity action for unlawful acquisition of property against (1) Michael Ray, (2) Neil Kolner, (3) the Sheriff of Dade County, Florida, in his official capacity, (4) the Clerk of the Circuit Court for Dade County, in his official capacity, and (5) two unnamed defendants. Massengale subsequently filed an amended complaint against the same parties. Kolner filed a motion to dismiss the complaint, which the district court denied. Massengale filed a motion to amend his complaint along with a second-amended complaint. The district court granted Massengale's motion to amend, but found that his second-amended complaint failed to state a cause of action under either Florida or federal law. The district court stated that it would allow Massengale an opportunity to refile the second-amended complaint to clearly state a cause of action.

Prior to the district court's granting Massengale's motion to amend, Kolner filed a motion for sanctions pursuant to Rule 11. Kolner argued that Massengale violated Rule 11 because: (1) Massengale's pleadings had been filed to harass and cause unnecessary delay; (2) Massengale's claims lacked evidentiary support and were unsupported by existing law; and (3) Massengale continued to practice law despite having been disbarred. Kolner pointed to assertions he made in his motion to dismiss to support his claim, as well as various district court orders that he claimed showed Massengale's violations of the rules. The magistrate judge recommended that the motion be denied, finding that: (1) the case file did not show that Kolner had complied with Rule 11's safe-harbor provision, which requires the challenged party be given twenty-one days to withdraw or correct the challenged paper or claim; and (2) the district court had denied Kolner's motion to dismiss (upon which he had relied to support his motion for sanctions). The district court reversed the magistrate judge's report and recommendation and remanded for consideration of the sanctions issue, finding Kolner had satisfied Rule 11's safe-harbor requirement and that the magistrate judge had failed to consider all of the documents Kolner relied upon in support of his motion.

Massengale refiled his second-amended complaint after the district court denied Kolner's first motion to dismiss. Kolner moved to dismiss the second-amended complaint, alleging that the complaint: (1) failed to allege sufficient facts to support diversity jurisdiction; (2) failed to state a claim upon which relief could be granted because it did not cite to any relevant Florida or federal law; (3) failed to join an indispensable party as a plaintiff; and (4) asserted claims against dismissed defendants. The court granted Kolner's motion to dismiss, finding that Massengale improperly alleged claims against dismissed defendants and that he failed to comply with the court's prior order to clearly state a cause of action under Florida or federal law. The court gave Massengale fifteen days to file an amended complaint in accordance with its instructions.

Massengale filed an amended complaint, and Kolner then filed a motion to dismiss the amended complaint or, in the alternative, for summary judgment. Kolner argued that the complaint still failed to state a cause of action under Florida or federal law, and contended that the complaint should be dismissed with prejudice due to Massengale's repeated failure to comply with court orders and rules. Prior to Kolner's motion, the court had — on two occasions — ordered Massengale to file a written response explaining why a document submitted with one of his motions contained different information than the original copy of that document in the court file. Massengale failed to respond to either court order.

After considering its own orders to show cause and Kolner's motion to dismiss, the district court dismissed Massengale's action with prejudice. Kolner then filed a motion to reinstate his Rule 11 motion for sanctions, asserting it had remained pending after the district court's reversal of the magistrate judge's report. The magistrate judge recommended that Kolner's motion be denied, as the district court had already imposed a severe sanction by dismissing Massengale's complaint with prejudice. The district court reversed the magistrate judge's decision and reinstated Kolner's motion. The district court found that Massengale's complaint had been dismissed due to his failure to follow court orders and possible alteration of exhibits. Because Kolner's motion for Rule 11 sanctions was based on conduct that occurred prior to the dismissal of the complaint, the district court reasoned that the motion warranted review.

We affirmed this decision in Massengale v. Ray, No. 99-4313, 210 F.3d 393 (11th Cir. Feb. 15, 2000) (unpublished table decision).

Following a hearing, the magistrate judge recommended that Kolner's motion for sanctions be granted. The magistrate judge found that Massengale failed to present evidence demonstrating that he filed his amended complaint in good faith and that the case had factual and legal support. The magistrate judge concluded that Rule 11's deterrence goal could be met by imposing a sanction that would compensate Kolner for the value of attorney's fees incurred as a result of Massengale's conduct. Based on Kolner's testimony at the hearing, the magistrate judge determined that $25,000 represented reasonable attorney's fees for the time Kolner spent on the case, and that it was the minimum amount that adequately would deter Massengale from future lawsuits.

The district court adopted the magistrate judge's report and recommendation and granted Kolner's motion for Rule 11 sanctions. This appeal followed.

DISCUSSION

We review a district court's award of Rule 11 sanctions for abuse of discretion. Baker v. Alderman, 158 F.3d 516, 521 (11th Cir. 1998). Rule 11 sanctions are properly assessed "(1) when a party files a pleading that has no reasonable factual basis; (2) when the party files a pleading that is based on a legal theory that has no reasonable chance of success and that cannot be advanced as a reasonable argument to change existing law; or (3) when the party files a pleading in bad faith for an improper purpose." Worldwide Primates, Inc. v. McGreal, 87 F.3d 1252, 1254 (11th Cir. 1996). "[T]he selection of the type of sanction to be imposed lies within the district court's sound exercise of discretion." Donaldson v. Clark, 819 F.2d 1551, 1557 (11th Cir. 1987) (en banc). If warranted for effective deterrence, an appropriate sanction may include "an order directing payment to the movant of some or all of the reasonable attorneys' fees and other expenses" incurred as a result of the Rule 11 violation. Fed.R.Civ.P. 11(c)(2). The goal of Rule 11 sanctions is to "reduce frivolous claims, defenses, or motions, and to deter costly meritless maneuvers." Donaldson, 819 F.2d at 1556 (internal quotation marks and citation omitted).

Massengale argues that the district court erred in awarding attorney's fees to Kolner pursuant to Rule 11 because Kolner represented himself in the case. Massengale contends that under Ray v. U.S. Dep't of Justice, 87 F.3d 1250 (11th Cir. 1996), Kolner is not entitled to fees for his own legal work. Massengale also argues that the district court was without a proper legal basis for imposing sanctions pursuant to Rule 11. We consider first whether Rule 11 allows for an award of attorney's fees to a pro se litigant.

In Ray, we considered whether a district court could award attorney's fees to a pro se litigant who was also a lawyer under the fee shifting provision of the Freedom of Information Act ("FOIA"), 5 U.S.C. § 552(a)(4)(E). The panel relied on Kay v. Ehrler, 499 U.S. 432, 111 S.Ct. 1435, 113 L.Ed.2d 486 (1991), in which the Supreme Court decided that a pro se litigant could not be awarded attorneys' fees under 42 U.S.C. § 1988. The Court decided that the "overriding statutory concern" of section 1988 was to encourage the retention of independent counsel by victims of civil rights violations, and awarding fees to pro se litigants would discourage plaintiffs from retaining independent counsel. Kay, 499 U.S. at 437, 111 S.Ct. 1435. In Ray, we noted that the fee shifting provisions of the FOIA and section 1988 were "substantially similar." Ray, 87 F.3d at 1251. Thus, we concluded that the statutes should be interpreted similarly, and that awarding attorney's fees to pro se litigants under the fee shifting provision of the FOIA would frustrate the policy of encouraging litigants to retain independent counsel. See id. at 1251-52.

The policy underlying Rule 11 is not to encourage litigants to retain independent counsel; rather, "Rule 11 sanctions are designed to discourage dilatory or abusive tactics and help to streamline the litigation process by lessening frivolous claims or defenses." Donaldson, 819 F.2d at 1556 (internal quotation marks and citation omitted). Also, "sanctions may be imposed for the purpose of deterrence, compensation and punishment." Aetna Ins. Co. v. Meeker, 953 F.2d 1328, 1334 (11th Cir. 1992). "The type and amount of sanction imposed calls for the proper exercise of a district court's discretion." Id. (citing Donaldson, 819 F.2d at 1557). It appears that the district court properly concluded that Massengale violated Rule 11, and that the court could, in its discretion, impose sanctions against Massengale. Whether the district court properly exercised its discretion in this case is another matter.

While it is true that the purpose behind Rule 11 sanctions is deterrence and punishment, and not to encourage litigants to retain independent counsel, we cannot conclude that Rule 11 allows for an award of attorneys' fees to a pro se litigant as a sanction. When a district court determines that an "attorney or unrepresented party" has violated Rule 11(b), it "may . . . impose an appropriate sanction upon the . . . part[y] that . . . violated subsection (b). . . ." Fed.R.Civ.P. 11(b), (c). The sanction imposed may include "an order directing payment to the movant of some or all of the reasonable attorneys' fees and other expenses incurred as a direct result of the violation." Fed.R.Civ.P. 11(c)(2). Because a party proceeding pro se cannot have incurred attorney's fees as an expense, a district court cannot order a violating party to pay a pro se litigant a reasonable attorney's fee as part of a sanction. In Ray, we observed that:

[T]he word "attorney" generally assumes some kind of agency (that is, attorney/client) relationship. The fees a lawyer might charge himself are not, strictly speaking, "attorney's fees." And, where a lawyer represents himself, legal fees are not truly a "cost" of litigation — no independent lawyer has been hired (or must be paid) to pursue the . . . complaint.

Ray, 87 F.3d at 1251 n. 2 (citations omitted). Because Kolner did not incur legal fees as a cost or expense in representing himself, the district court erred in awarding $25,000 in attorney's fees to Kolner as a sanction upon Massengale. The award violated the plain language of Rule 11, and the district court abused its discretion in imposing it.

Kolner specifically sought attorney's fees as the sanction, as though he had been represented by counsel, instead of seeking to recover sanctions measured by lost income resulting from time away from his practice. Therefore we have no occasion to decide whether a pro se litigant, either a lawyer or a nonlawyer, could properly seek and be awarded a Rule 11 sanction measured by the loss of income that litigant suffered as a result of having to take time off work to respond to the sanctionable conduct. We reserve that question for future decision.

CONCLUSION

We agree with the district court's conclusion that Massengale violated Rule 11. Because Massengale is a person who signed papers filed with the court, the district court can impose, within its sound discretion, appropriate sanctions that would serve Rule 11's deterrent purpose. The district court cannot, however, impose sanctions including the award of attorney's fees to a pro se litigant. We therefore VACATE the order imposing sanctions and REMAND to the district court for further proceedings consistent with this opinion.

MASSENGALE v. RAY