In re: GTI Capital Holdings, LLC, et al v. Comerica Bank, et al, No. 09-60039 (9th Cir. 2010)
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FILED NOT FOR PUBLICATION UNITED STATES COURT OF APPEALS OCT 08 2010 MOLLY C. DWYER, CLERK U .S. C O U R T OF APPE ALS FOR THE NINTH CIRCUIT In re: GTI CAPITAL HOLDINGS, LLC, an Arizona limited liability company, DBA Rockland Materials, No. 09-60039 BAP No. AZ-09-1053-JuMkD Debtor, MEMORANDUM * TRIAD COMMERCIAL CAPTIVE CO.; et al., Appellants, v. COMERICA BANK; et al., Appellees. Appeal from the Ninth Circuit Bankruptcy Appellate Panel Markell, Dunn, and Jury, Bankruptcy Judges, Presiding Submitted October 6, 2010 ** San Francisco, California * This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3. ** The panel unanimously concludes that this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). Before: THOMPSON, FERNANDEZ and SILVERMAN, Circuit Judges. Appellants challenge the bankruptcy court s imposition of sanctions, pursuant to Fed. R. Civ. P. 37(a)(5)(B), following the denial of their Rule 37 motion to compel depositions. We have jurisdiction pursuant to 28 U.S.C. ยงยง 158(d)(1) and 1291. We affirm. First, the bankruptcy court had jurisdiction to impose the sanctions, despite previously granting Appellants request to voluntarily withdraw their complaints. It is well established that a federal court may consider collateral issues after an action is no longer pending. Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 395 (1990). Rule 37(a)(5)(B) sanctions are collateral because they aim to deter abuse of the judicial process and have no bearing, and therefore no res judicata effect, on the case s underlying merits. Id. at 396; see also Willy v. Coastal Corp., 503 U.S. 131, 139 (1992). Second, the bankruptcy court did not abuse its discretion in imposing sanctions under Rule 37(a)(5)(B). Appellants have failed at all levels to demonstrate that their motion to compel was substantially justified, i.e., that reasonable people could differ as to whether the party requested must comply with their motion to compel. See Reygo Pac. Corp. v. Johnston Pump Co., 680 F.2d 647, 649 (9th Cir. 1982). -2- AFFIRMED. -3-
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