Opinion
No. C-96-4179 THE
October 10, 2001
ORDER OF REFERRAL TO MAGISTRATE JUDGE RE POTENTIAL SANCTIONS
FACTUAL BACKGROUND
On August 22, 2001, this Court held a hearing to decide whether Ravenswood City Elementary School District ("Ravenswood") should be held in contempt. In support of its defense, counsel for Ravenswood filed an exhibit on August 22, 2001, which consisted of petitions in support of the Ravenswood Board of Trustees and Ravenswood Superintendent Dr. Charlie Mae Knight. (Exhibit B to Snell Second Supp. Decl.) The exhibit was accompanied by a sworn declaration from counsel stating that the exhibit contained "true and correct copies of thirty-five pages of petitions made by parents and residents of East Palo Alto, Menlo Park and friends of the District, expressing their support for the District's Board of Trustees and Dr. Knight." (Snell Second Supp. Decl. at ¶ 3)
On September 14, 2001, Counsel for Defendants sent a letter to this Court withdrawing the exhibit. (copy attached hereto) Counsel admitted that the signatures on the petitions had been collected in 1997 and 2000 in connection with other matters. Counsel further stated that she had just received the document the day of the contempt hearing and that neither Dr. Knight nor any of the members of the Board of Trustees were "involved in the preparation or presentation of this exhibit." On September 15, 2001. the San Jose Mercury News reported that signatures from earlier petitions had been pasted onto a new petition heading, which made it look like the signatures had been collected for the instant contempt proceedings. The paper also reported that an investigation had revealed other irregularities in the petitions. The article further stated that the petitions had been sent from a fax machine in Dr. Knight's office. (copy of article attached hereto)
The heading reads:
To: Honorable Felton [sic] Henderson
From: Ravenswood Parents and Citizens of East Palo Alto, Menlo Park and Friends of the District
Re: Petition in Support of The Ravenswood Board of Trustees and Superintendent, Dr. Charlie Mae Knight
We the following parents and friends of the Ravenswood City School District support the locally elected Board of Trustees and the Superintendent of Schools, Dr. Charlie Mae Knight. We have full confidence in their desire and ability to serve all of the children in the Ravenswood City School District.
According to the article, "a Mercury News review found signatures listing addresses that do not exist, signatures of people who insist they neither saw the petition nor support the district's leadership, and signatures from out-of-towners who say they have never heard of Knight and her district."
LEGAL STANDARD
Federal Rule of Civil Procedure 11 provides for the imposition of sanctions for filings which are frivolous, legally unreasonable, or brought for an improper purpose. Townsend v. Holman Consulting Corp., 929 F.2d 1358, 1362 (9th Cir. 1990). Papers filed to perpetrate a fraud on the court are submitted for an "improper purpose" and are violative of Rule 11. Warren v. Guelker, 29 F.3d 1386 (9th Cir. 1994) (false statement in complaint regarding existence of prior lawsuit); In re Omnitron Int'l, Inc. Sec. Litig., 1994 WL 476694 *3 (ND. Cal., Aug. 19, 1994) (fraudulently signed expert witness declarations); Sun World Inc. v. Lizarazu Olivarria, 144 F.R.D. 384, 389 (E.D. Cal. 1992) (falsified documents in opposition to plaintiffs request for a writ of attachment). The standard of conduct under Rule 11 is one of objective reasonableness. Business Guides v. Chromatics Communications Enter., Inc., 119 F.R.D. 685, 688 (N.D. Cal., April 12, 1988). A party may be held liable where the party offers inaccurate information which could easily have been checked on prior to submitting information. See id. at 687. In addition, Rule 11 may apply to parties who did not actually sign the offending document. See id. at 690.
Courts also have the inherent power to impose sanctions for abusive litigation practices in any proceeding in federal district court. Chambers v. NASCO, Inc., 501 U.S. 32 (1991); F.J. Hanshaw Enter., Inc. v. Emerald Dev., Inc., 244 F.3d 1128, 1136 (9th Cir. 2001). Such sanctions may be imposed on both counsel and parties. Alyeska, Pipeline Serv. v. Wilderness Society, 447 U.S. 752, 766 (1980) (counsel). Fabricating documentary evidence is a litigation abuse and is subject to inherent powers sanctions. Pope v. Federal Express Corp., 974 F.2d 982, 984 (8th Cir. 1992).
DISCUSSION
It is clear that the petitions filed on August 22, 2001 are fraudulent documents, given that counsel has admitted that the signatures attached thereto were collected for other matters and not the instant contempt proceedings as the petitions were doctored to suggest. The filing of a fraudulent document is a serious matter because its very nature "threatens the integrity of the judicial process." See Omnitron, 1994 WL 476694 at *8.
While the letter from Ms. Snell states that neither Dr. Knight, nor any members of the Board of Trustees, were involved in the "preparation or presentation" of the exhibit, the fact that the petitions were apparently faxed from the Superintendent's office, and the Superintendent and Board of Trustees were presumably aware that said petitions were filed and presented to the Court on their behalf, raises serious questions regarding their potential complicity, if not outright participation, in this incident that can not be readily dismissed with conclusory assertions.
In short, under the aforementioned legal principles and the information presently before the Court, it appears that Dr. Knight and the individual members of the Ravenswood Board of Trustees may have directly or indirectly participated in, or otherwise tacitly encouraged or permitted, a "fraud on the court" which is punishable by sanctions. And while counsel Karen Snell only received the petitions the day of the hearing, and subsequently withdrew them on September 14, 2001, it is also appropriate to explore whether counsel for Ravenswood met her obligations to the Court.
Accordingly, and good cause appearing, the Court sua sponte HEREBY ORDERS § that this matter be referred to Magistrate Judge Elizabeth LaPorte to hold such evidentiary or other hearings or proceedings as she deems appropriate and necessary in order to make a report and recommendation to this Court as to (1) whether any of the above-mentioned parties or counsel should be held partly or wholly responsible in any way for the creation, submission, or filing of the petitions at issue, and (2) the amount of sanctions that should be imposed, if any, under either Federal Rule of Civil Procedure 11 or the inherent powers of the court. See Business Guides, 119 F.R.D. at 687 (referring similar matter to Magistrate Judge for report and recommendation).
As stated, this referral is issued sua sponte and not at the behest of any party or in response to any filing by the parties. In this regard, the Court notes that on October 1, 2001, plaintiffs filed an "ex parte application to permit the introduction of additional newly discovered evidence in support of Plaintiffs' Motion or Contempt" which concerns the petitions at issue as well as other matters. This request, and Ravenswood's October 2, 2001 letter responding thereto, will be addressed separately by the Court at a later date.
As indicated above, the petitions raises issues of fraud in two separate respects. First, signatures collected from other matters in 1997 and 2000 were apparently pasted onto a new petition heading relating to the instant case and filed on August 22, 2001. Second, irregularities have been found with respect to the signatures collected in 1997 and 2000. While the Magistrate Judge should initially focus the proceedings on the first matter, she may, in her discretion, consider whether sanctions against the Superintendent or members of the Board of Trustees are warranted with respect to the second matter as well, if the proceedings and record indicate that exploration into this second area is appropriate.
With respect to any sanctions under the inherent powers of the court, the Magistrate Judge should, at this juncture, only consider sanctions which do not rise to the level of criminal sanctions (which would require a jury trial). See F. J. Hanshaw, 244 F.3d at 1139 and n. 10.
IT IS SO ORDERED.
CLARENCE SNELL LLP Attorneys at Law Van Ness/Ellis Professional Building 899 Ellis Street San Francisco, California 94109-7807 September 14, 2001
Hon. Thelton E. Henderson United States District Court 450 Golden Gate Avenue San Francisco, CA 94102
Re: Emma C., et al. v. Delaine Eastin, et al., C-96-4179-THE
Dear Judge Henderson:
On August 22, 2001, I filed a series of exhibits in support of the Ravenswood City' Elementary School District's Reply to Plaintiffs and CDE's Responses to the Court's Order to Show Cause why the District should not be held in contempt. One of the exhibits consisted of copies of petitions in support of the Board of Trustees and the Superintendent that had been faxed to me earlier that day. It has come to my attention that the signatures in support of the District were originally obtained in late 1997 and 2000 in connection with the San Mateo County grand jury investigation, and not in response to the Order to Show Cause. For this reason, I hereby request that the exhibit be withdrawn and offer my apology to the Court. While I have no reason to doubt that those who signed the petitions continue to support the District, it was inappropriate to submit the signatures under these circumstances. Finally, I have made inquiries and can assure the Court that neither Dr. Knight nor any of the members of the Board of Trustees were involved in the preparation or presentation of this exhibit.
Thank you for your time in considering this matter.
Yours very truly.
Karen L. Snell On Behalf of the Ravenswood City School District
cc: Rony Sagy Diane Lipton Bill Koski Michael Hersher Mark Mlawer