Counsel for defendants in an antitrust case must pay thousands of dollars as a sanction for filing a motion for attorneys’ fees without a legal or factual basis, a federal court in North Carolina ruled.
Attorneys Steven W. Shaw in Mapleton, Utah, and John David Matheny II in Mooresville, N.C., filed the motion on behalf of two separate groups of defendants five months after a jury ruled for the plaintiffs, who alleged their homes were bought at foreclosure in a bid-rigging scheme.
The attorneys sought fees for time spent on limited aspects of the case where they claimed their clients prevailed, namely the dismissal of some defendants from the case before trial and the defeat of class certification.
The attorneys violated Rule 11(b)(2) and 11(b)(3) of the Federal Rules of Civil Procedure because the motion “was unsupported in law and fact and unreasonable under the circumstances,” Judge Catherine C. Eagles of the US District Court for the Middle District of North Carolina ruled Thursday.
- The attorneys “improperly asked for approximately $250,000 in attorney’s fees without citing to any legal authority or material evidence,” Eagles said
- The court ordered Matheny, who asserts Shaw drafted and filed the document and electronically appended his signature to the motion without his knowledge, to pay $2,500
- Eagles ordered Shaw to pay $25,000 as “necessary and appropriate to deter similar activity by other attorneys,” and to reimburse plaintiffs’ attorney’s fees of $3,640 caused by the misconduct
- The court also sanctioned defendant Craig Brooksby as “the litigant running the show,” and ordered that he observe six days of court proceedings, “which should end up being roughly triple the time spent by plaintiffs’ counsel,” responding to the motion for attorney’s fees
J.C. White Law Group PLLC and Blue LLP represented the plaintiffs.
The case is Williams v. Estates LLC, 2023 BL 95803, M.D.N.C., No. 19-cv-1076, 3/23/23.
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