Unpublished Disposition, 860 F.2d 1089 (9th Cir. 1987)

MEMORANDUM^** 

Clyde C. Grego, Sr., and ten other unpaid investors ("Greco") appeal the district court's dismissal of their bankruptcy appeal for failure to prosecute. Because we find that the district court erred by failing to consider alternative sanctions, we reverse and remand to the district court.¹ 

FACTS

In 1982, Greco appealed a bankruptcy court judgment in favor of the Christian Life Center and its pastor, Reverend A. Watson Argue, Jr. ("Argue"), to the Bankruptcy Appellate Panel (BAP). On February 22, 1982, Greco filed a request to prepare the reporter's transcript. Despite an order from the BAP, the court reporter has not yet filed the complete transcript.

On May 20, 1983, BAP sent a notice to Greco, which stated that Greco's counsel had failed to file an opening brief and warned of the possibility that the appeal would be dismissed for lack of prosecution.

BAP transferred jurisdiction of the appeal to the district court on November 30, 1984. Greco contends that they devoted the bulk of their efforts during this period to a closely related class action because they believed that the class action would render the bankruptcy appeal moot. From November of 1986 until March of 1987, Greco and Argue engaged in settlement negotiations relating to this class action.

On March 13, 1987, Argue filed a motion to dismiss the bankruptcy appeal. Greco timely filed an opposition to the motion. On July 10, 1987, the court dismissed the appeal for failure to prosecute.

DISCUSSION

The district court dismissed Greco's appeal pursuant to Bankr.R. 8001(a). This court reviews dismissals for failure to prosecute for an abuse of discretion. Myers v. Shekter (In re Hill), 775 F.2d 1385, 1386 (9th Cir. 1985) (per curiam).

The sanction of dismissal should be imposed only in extreme circumstances. United States v. National Medical Enterprises, Inc., 792 F.2d 906, 912 (9th Cir. 1986). Because of this sanction's severity, we have held that a district court abuses its discretion if it imposes the sanction of dismissal without first considering the adequacy of less drastic sanctions. Id. at 912.

The district court did not explicitly discuss alternative sanctions in its dismissal order. An explicit discussion of alternatives is unnecessary if (1) egregious circumstances exist, such as the plaintiff's purposeful and defiant violation of a court order; or (2) the district court actually tries alternatives before employing the sanction of dismissal. Malone v. United States Postal Service, 833 F.2d 128, 131 (9th Cir. 1987). Warning an appellant that failure to obey a court order will result in dismissal can suffice to meet the "consideration of alternatives" requirement. See id. However, the court must warn the plaintiff that dismissal is imminent. See Hamilton v. Neptune Orient Lines, Ltd., 811 F.2d 498, 500 (9th Cir. 1987).

There is no indication in the record that Greco "purposefully and defiantly" failed to file an opening brief. Nor did the district court try alternative sanctions. However, in 1983 BAP warned Greco of the possibility of dismissal for failure to prosecute. Yet Greco received no further warnings until Argue moved to dismiss in 1987.

The four year interim between BAP's warning and Argue's motion to dismiss and the parties' ongoing settlement negotiations suggest that Greco reasonably believed that dismissal was not imminent. Therefore, the district court failed to meet the "consideration of alternatives" requirement.

REVERSED and REMANDED.