Tejero v. Portfolio Recovery Assoc., LLC, No. 18-50661 (5th Cir. 2020)Annotate this Case
After plaintiff filed suit against Portfolio under the Fair Debt Collection Practices Act and state law, the parties reached a settlement that forgave plaintiff's debt and awarded him $1,000 in damages. The district court then determined that plaintiff's attorneys did not settle his lawsuit quickly enough and consequently sanctioned them.
The Fifth Circuit reversed the district court's sanction order, holding that the district court abused its discretion by awarding attorney's fees sua sponte under Federal Rule of Civil Procedure 11. Furthermore, the reasons the district court proffered for sanctions were meritless. Because the district court judge was not biased against plaintiff, the court affirmed the denial of plaintiff's recusal motion. In this case, the judge's ire was clearly directed at the attorneys, not plaintiff. Accordingly, the court affirmed in part, remanding for further proceedings.