Unpublished Disposition, 937 F.2d 612 (9th Cir. 1991)

MEMORANDUM^* 

Attorney Kenneth P. Gray appeals a sanction order imposed for putting forward an argument in a motion for summary judgment which the trial court found to be frivolous. The finding that the motion was in violation of Fed. R. Civ. P. 11 followed briefing and supplemental briefing on various theories propounded by Mr. Gray and contested by his opponent.

Our examination of the briefs and the relevant portions of the record satisfies us that Mr. Gray's defense, essentially a counterclaim for indemnification from the plaintiffs, was not well founded in any viable theory of law. However, Mr. Gray's defense did contain a motion to dismiss the plaintiffs' state law claims, and the court dismissed them on grounds not stated in the motion.

On the entire record, this case illustrates the wisdom of the general rule against interlocutory appeals and the folly of the erosion of that rule. We recognize that we have jurisdiction of this interlocutory appeal under the collateral order exception to 28 U.S.C. § 1291 (1988). See United States v. Szado, 912 F.2d 390, 391 (9th Cir. 1990). At argument, however, we were told that the underlying litigation had been settled. If the settlement did not deal with the costs of the litigation, that oversight is not a matter this court will now address.

The sanction order is vacated on the authority of Golden Eagle Distrib. Corp. v. Burroughs Corp., 801 F.2d 1531 (9th Cir. 1986), which was the law of the circuit at the time the sanctions were ordered. No party shall recover costs on appeal.