Unpublished Disposition, 936 F.2d 577 (9th Cir. 1992)

Nos. 90-55662, 90-55817.

United States Court of Appeals, Ninth Circuit.

Before FLETCHER and CANBY, Circuit Judges, and McNICHOLS,^*  District Judge.

The district court's denial of defendants' motion to vacate the preliminary injunction is affirmed. The defendants failed to show that the plaintiffs obtained the injunction through fraud. The district court did not abuse its discretion in denying the motion to vacate.

Defendants' appeal of the district court's denial of the motion to vacate the preliminary injunction is frivolous. Defendants concede facts which make it clear that, at the time the district court denied the motion to vacate, the injunction was valid. The addition of HBR Partnership as a plaintiff in May 1989 was curative of any problem relating to the validity of the injunction. The plaintiffs are entitled to recover their attorneys' fees incurred as a result of this appeal pursuant to Federal Rule of Appellate Procedure 38.

The district court's imposition of a $5000 sanction against defendants' counsel is reversed and remanded for a hearing on the sanctions. Defendants' counsel is entitled to notice and an opportunity to respond before sanctions can be levied under Rule 11. See Hudson v. Moore Business Forms, 898 F.2d 684, 686 (9th Cir. 1990). Although no appeal by plaintiffs' counsel is currently pending, it would be appropriate for the district court to provide plaintiffs' counsel an opportunity to respond to the sanctions imposed against him.

AFFIRMED IN PART, REVERSED IN PART, and REMANDED FOR FURTHER PROCEEDINGS.