United States District Court, S.D. Illinois
JETSON MITCHELL, Individually and on behalf of all others similarly situated, Plaintiffs,
MURRAY ENERGY CORPORATION, AMERICAN COAL COMPANY, INC., and JOHN DOES 1-20, Defendants.
REPORT AND RECOMMENDATION
a proposed class action brought pursuant to an alleged
violation of the Worker Adjustment and Retraining
Notification Act (“WARN Act”). Plaintiff alleges
Defendants failed to provide the required 60-day advanced
notice of a mass layoff at its New Future Mine in Galatia,
Illinois. On September 19, 2017, Plaintiff filed a motion for
sanctions that is now before the Court (Doc. 26). Defendants
filed their timely response on October 3, 2017 (Doc. 27). The
matter has been referred to United States Magistrate Judge
Reona J. Daly by United States District Judge Nancy J.
Rosenstengel pursuant to 28 U.S.C. § 636(b)(1)(B),
Federal Rule of Civil Procedure 72(b), and SDIL-LR 72.1(a)
for a Report and Recommendation. The undersigned held a
hearing on Plaintiff's motion on November 30, 2017. Based
on the following, it is RECOMMENDED that the
District Court DENY Plaintiff's motion
filed this action on April 28, 2017 (Doc. 1). Prior to filing
their answer, counsel for Defendants sent counsel for
Plaintiff correspondence setting forth pertinent employment
and layoff figures for the mining complex and, based on their
representation of the facts, urged counsel for Plaintiff to
voluntarily dismiss the matter or they would “be forced
to pursue relief under F.R.Civ.Pro. 11 and 28 U.S.C. §
1927.” (May 1, 2017 Letter, Doc. 26-1). Plaintiff's
counsel responded by letter requesting that Defendants
provide certain verified information in order to
“expedite the parties' assessment and potential
resolution of this matter.” (May 24, 2017 Letter, Doc.
26-2). Defendants' counsel responded by letter on June
27, 2017, wherein they provided new calculations along with
the declaration of Cindy Biggs, the manager of Human
Resources for The American Coal Company. Again, counsel for
Defendants urged counsel for Plaintiff to voluntarily dismiss
the matter or they would “be forced to pursue relief
under F.R.Civ.Pro. 11 and 28 U.S.C. § 1927.” (June
27, 2017 Letter, Doc. 26-3). The following day, June 28,
2017, Defendants filed their answer to Plaintiff's
complaint as well as a motion for summary judgment (Doc. 13
in their motion for summary judgment, Defendants argued there
was no violation of the WARN Act insofar as there was not a
33% reduction in force at a “single site of employment,
” as defined by the Act. In support of their motion,
Defendants relied on the declaration of Cindy Biggs.
Plaintiff filed a response in opposition to Defendants'
motion disputing not only the merits, but also asserting that
a stay of summary judgment proceedings was warranted pending
discovery as Plaintiff had not yet had the opportunity to
test the factual assertions set forth by Defendants.
Defendants filed a reply to Plaintiff's response to
counter technical arguments made by Plaintiff that they
contended were erroneous. Defendants also argued that summary
judgment in the early stages of the proceedings was warranted
as they “provided specific facts showing that TACC
discharged less than 33% of workers” and concluded that
“[d]iscovery could not possibly reveal evidence
altering that conclusion.” (Doc. 22, p. 5).
days after filing their reply brief, Defendants sought leave
to withdraw their motion for summary judgment (Doc. 23).
Defendants' motion to withdraw was granted (Doc. 25).
Counsel for Plaintiff asserts they had drafted, and were
planning to file, a motion to strike Defendants' reply at
the time they were served with Defendants' motion to
withdraw. Defendants sought to withdraw their motion
“because examination of documentary evidence in
preparation for their Fed.R.Civ.P. 26 Initial Disclosures
revealed information that Defendants want to include and
attach to a future dispositive pleading.”
(Id.). Defendants go on to acknowledge that
“this same information suggests that numerical
representations contained in Defendants' summary judgment
pleadings lack precision and need refined [sic],
though the imprecision neither creates a dispute of material
fact nor triggers the [Act].” (Id.). At the
hearing on Plaintiff's motion for sanctions, counsel for
Defendants admitted their client's numbers were incorrect
when they drafted their summary judgment motion, but any
discrepancies were minor and immaterial and did not come to
their attention until they were able to review the “raw
asks the Court to order Defendants to reimburse
Plaintiff's counsel their reasonable fees and costs
incurred in responding to Defendants' frivolous summary
judgment motion and reply due to the conduct described above.
Plaintiff premises his motion on the Court's inherent
authority to sanction.
well settled that “a court has the inherent authority
to manage judicial proceedings and to regulate the conduct of
those appearing before it, and pursuant to that authority may
impose appropriate sanctions to penalize and discourage
misconduct.” Ramirez v. T&H Lemont, Inc.,
845 F.3d 772, 776 (7th Cir. 2016). A court exercising its
inherent authority to sanction must “find that the
responsible party acted or failed to act with a degree of
culpability that exceeds simple inadvertence or
mistake….” Id. (citations omitted).
Indeed, “[a]ny sanctions imposed pursuant to the
court's inherent authority must be premised on a finding
that the culpable party willfully abused the judicial process
or otherwise conducted the litigation in bad faith.”
Id. (citations omitted). “Bad faith” is
commonly ascribed to intentional actions undertaken to
mislead or fraud the court, such as falsifying evidence or
committing perjury. See, e.g., Secrease v. Western &
Southern Life Ins. Co., 800 F.3d 397 (7th Cir. 2015)
(dismissal upheld as an appropriate sanction for the
plaintiff's falsification of evidence intended to mislead
the court into granting his request to compel arbitration).
conduct by Defendants at issue here simply does not meet the
high hurdle of “bad faith.” Although Defendants
appear to have acted in a hasty manner in filing papers with
the Court without a thorough review of the data and
calculations on which said papers relied, such hastiness
would have been better addressed by way of a Rule 11 motion
for sanctions. Plaintiff has not sought sanctions by way of
Rule 11 and, at this juncture, has foregone the opportunity
to do so as it is apparent that Rule 11(c)(2)'s
requirements were not met (even if the Court were not to
require strict compliance). See United States v. Rogers
Cartage Co., 794 F.3d 854, 863 (7th Cir. 2015) (Strict
compliance with Rule 11(c)(2) may be excused where there was
substantial compliance, where it was impossible to comply, or
where the party against whom sanctions are sought waived
compliance.). Because the Court finds that Plaintiff has
failed to demonstrate that Defendants acted in bad faith, it
cannot recommend an award of sanctions.
on the foregoing, it is RECOMMENDED that
Plaintiff's Motion for Sanctions (Doc. 26) be
DENIED, and that the Court adopt the
foregoing findings of fact and conclusions of law.
to 28 U.S.C. § 636(b)(1) and SDIL-LR 73.1(b), the
parties shall have fourteen (14) days after service of this
Report and Recommendation to file written objection thereto.
The failure to file a timely objection may result in the
waiver of the right to challenge this Report and
Recommendation before either the District ...