BP West Coast Products LLC v. Crossroad Petroleum, Inc. et al, No. 3:2012cv00665 - Document 649 (S.D. Cal. 2016)
Court Description: ORDER granting in part and denying in part 552 Appeal of Sanctions Recommendation. Signed by Judge Janis L. Sammartino on 11/29/2016. (kcm)
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA 9 10 11 12 13 14 15 16 17 BP WEST COAST PRODUCTS, LLC, Case No.: 12cv665 JLS (JLB) Lead Case Plaintiff and Counter-Defendant, v. ORDER GRANTING IN PART AND DENYING IN PART APPEAL OF SANCTIONS RECOMMENDATION CROSSROAD PETROLEUM, INC., ET AL., (ECF No. 552) Defendants and Counter-Claimants. AND RELATED CONSOLIDATED ACTIONS 18 Presently before the Court is Defendants’ and Cross Complainants’ (“Non- 19 Compliant Parties”) and Defendants’ and Cross Complainants’ Counsel Pamela G. Lacey’s 20 (“Counsel”) Appeal of Sanctions Recommendation (“Sanctions Appeal”) (ECF No. 552). 21 Counsel requests “that the sanctions recommendations [(“ECF No. 550”)] against all of the 22 parties and counsel be set aside . . . except for Toros and Marie Zorenkelian and Natalie 23 and Francois Alvandi.” 24 BACKGROUND 25 On February 22, 2016 Magistrate Judge Jill L. Burkhardt ordered “[a]ll parties” and 26 Counsel to “be present in person and legally and factually prepared to discuss settlement 27 of the case” on June 8, 2016. (Order re Mandatory Settlement Conferences (“Attendance 28 Order”) 2 (emphasis original), ECF No. 487.) The Attendance Order encompassed all 1 12cv665 JLS (JLB) Lead Case 1 parties at issue in this Sanctions Appeal. (See id. at 1.) Judge Burkhardt held the June 8, 2 2016 mandatory settlement conference (“MSC”) as scheduled, but thirty-two parties failed 3 to appear and others arrived late, some “more than an hour” so. (Order to Show Cause 4 Hr’g Tr. (“OSC Hr’g Tr.”) 5–6, ECF No. 548.) 5 After the MSC, Judge Burkhardt issued two June 14, 2016 orders to show cause 6 against certain non-appearing and late-arriving parties and attorneys David A. Schiller and 7 Pamela G. Lacey (“OSCs,” ECF Nos. 531, 532). Several weeks later, Counsel filed a 8 Response to the Order to Show Cause (“OSC Response,” ECF No. 538) on behalf of many 9 parties named in the OSCs. On July 28, 2016 Judge Burkhardt held oral argument 10 regarding the OSCs and the OSC Response. (See OSC Hr’g Tr., ECF No. 548). On August 11 9, 2016 Judge Burkhardt issued monetary sanctions against thirty-six Non-Compliant 12 Parties and attorneys Pamela G. Lacey and David A. Schiller, and recommended 13 terminating sanctions against nineteen Non-Compliant Parties. 14 Sanctions Issued and Terminating Sanctions Recommended 1–6 (“Sanctions Order”), ECF 15 No. 550.) Counsel and the Non-Compliant Parties now appeal the Sanctions Order. (See 16 generally Sanctions Appeal.) 17 (Order re Monetary LEGAL STANDARD 18 Appeals to a United States District Court from a United States Magistrate Judge’s 19 pretrial determinations regarding nondispositive issues are reviewed under a “clearly 20 erroneous or contrary to law” standard. 28 U.S.C. § 636(b)(1)(A); United States v. 21 Raddatz, 447 U.S. 667, 673 (1980). Dispositive issues are reviewed de novo. Bhan v. 22 NME Hosps., Inc., 929 F.2d 1404, 1414 (9th Cir. 1991); see 28 U.S.C. § 636(b)(1)(C). 23 Review under the clearly erroneous standard requires that the Court have a “definite and 24 firm conviction that a mistake has been committed” in order to disturb the underlying 25 decision. See, e.g., Easley v. Cromartie, 532 U.S. 234, 242 (2001); Fisher v. Tucson 26 Unified Sch. Dist., 652 F.3d 1131, 1136 (9th Cir. 2011). By contrast, de novo review means 27 no deference is given to the prior decision, see, e.g., Barrientos v. Wells Fargo Bank, N.A., 28 633 F.3d 1186, 1188 (9th Cir. 2011), and the Court must consider the matter anew, as if no 2 12cv665 JLS (JLB) Lead Case 1 decision previously had been rendered, see, e.g., Freeman v. DirecTV, Inc., 457 F.3d 1001, 2 1004 (9th Cir. 2006). 3 “All federal courts are vested with inherent powers enabling them to manage their 4 cases and courtrooms effectively and to ensure obedience to their orders. . . . As a function 5 of this power, courts can dismiss cases in their entirety, bar witnesses, award attorney’s 6 fees and assess fines.” Aloe Vera of Am., Inc. v. United States, 376 F.3d 960, 964–65 (9th 7 Cir. 2004). “Sanctions are an appropriate response to ‘willful disobedience of a court order 8 . . . or when the losing party has acted in bad faith, vexatiously, wantonly, or for oppressive 9 reasons.’” Id. (citing Fink v. Gomez, 239 F.3d 989, 991 (9th Cir. 2001)); see also Adriana 10 Int’l Corp. v. Thoeren, 913 F.2d 1406, 1411 (9th Cir. 1990) (noting that a “determination 11 that an order was disobeyed is entitled to considerable weight” because the judge issuing 12 the order “is the best equipped to assess the circumstances of the non-compliance” 13 (quotation marks and citations omitted)). 14 ANALYSIS 15 In the present case, Judge Burkhardt issued and recommended sanctions based on 16 “the reasons stated in the orders to show cause . . . as well as . . . the reasons stated at the 17 July 28, 2016 hearing . . . .” (Sanctions Recommendation 1.) The Sanctions Order 18 carefully sets forth for each Non-Compliant Party and attorney against whom sanctions are 19 imposed and recommended: (1) the type of sanction(s) recommended; (2) the applicable 20 Order to Show Cause; and (3) the relevant page citations in the Order to Show Cause 21 Hearing Transcript. 22 Judge Burkhardt’s imposed monetary sanctions are nondispositive, and thus are 23 reviewed for clear error; the recommended terminating sanctions are reviewed de novo. 24 Each is addressed in turn. 25 I. Monetary Sanctions 26 A. Non-appearing and Late-arriving Parties 27 The transcript from the July 28, 2016 Order to Show Cause Hearing reveals a 28 thoughtful, thorough, and well-reasoned analysis by Judge Burkhardt determining against 3 12cv665 JLS (JLB) Lead Case 1 whom to impose monetary sanctions and the distinct sum to be paid by each. (See generally 2 OSC Hr’g Tr.) 3 Burkhardt’s analysis, especially relevant to this appeal are the following points: 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Although the Court does not here exhaustively summarize Judge • counsel and defendants had approximately 76 days from the date on which Judge Burkhardt issued her Order setting the relevant MSC in which to ensure attendance at the MSC, (see Attendance Order 1); • all parties were notified in the Attendance Order that personal appearance was required and that written motion, submitted at least ten days prior to the MSC, was the only mechanism for seeking excusal from the MSC, (id.); • all parties were notified in the Attendance Order that failure to attend the MSC could be cause for immediate imposition of sanctions, (id.); • thirty-two parties failed to appear at the June 8th MSC, resulting in a delay of at least two hours and the settlement discussion failing to conclude until approximately 9:00 p.m. that night, (OSC Hr’g Tr. 5–6); • several parties arrived to the MSC late—Judge Burkhardt did not issue orders to show cause as to those who arrived within the MSC’s first hour, (id. at 6); • Judge Burkhardt—both at the MSC and in her OSCs—solicited reasons both from the Non-Compliant Parties, their counsel, and their purported representatives at the MSC as to why the Non-Compliant Parties failed to comply with the Attendance Order, and took any such explanations under consideration in her sanctions recommendations, (id. at 6–7, 9); • Judge Burkhardt ultimately divided the groups of Non-Compliant Parties into distinct categories for purposes of recommending sanctions, including whether the Non-Compliant Party filed a declaration in response to the OSCs, whether the Non-Compliant Party had a representative present at the conference, whether the represented Non-Compliant Party settled, and whether the Non-Compliant Party was merely late rather than not in attendance, (id. at 11–17). 24 Also relevant to this appeal is the overall context of this case, in which sanctions have been 25 requested numerous times. The Court initially denied several sanctions motions, (ECF 26 Nos. 250, 313), but has since imposed sanctions against several parties, including many of 27 the parties at issue in this Sanctions Appeal, (see, e.g., ECF Nos. 319, 332, 392, 404, 431, 28 435, 478). Further, the Court recently gave notice to several parties—including the Non4 12cv665 JLS (JLB) Lead Case 1 Compliant Parites—that dispositive sanctions could be appropriate if they continued to fail 2 to abide by Court orders. (See December 14, 2015 Order 13–14, 15–16, ECF No. 478.) 3 After reviewing all of the above-listed documents, the Court is satisfied that Judge 4 Burkhardt did not clearly err in imposing monetary sanctions in the amounts set forth in 5 the Sanctions Recommendation. 6 underlying each Non-Compliant Party’s failure to comply with the Court’s Orders, 7 including any reasons given either by the Non-Compliant Party or their purported 8 representative. 9 distinguishing the recommended sanction amounts as between one party who satisfactorily 10 “documented the serious nature of her personal health problem” and others who did not); 11 id. at 13–14 (discussing non-appearing parties and distinguishing the recommended 12 sanction amounts as between parties whose non appearances had minimal “impact on the 13 ability to proceed effectively with the mandatory settlement conference” as opposed to 14 those whose failures to appear had impacts that could not be determined); id. at 14–15 15 (considering Counsel’s oral note of a non-appearing party filing a declaration “a day late,” 16 pausing oral argument to read the declaration, finding non-appearing party’s explanation 17 nonpersuasive, but nonetheless reducing the imposed sanction because the party in fact 18 filed a declaration).) Judge Burkhardt considered the circumstances (See, e.g., OSC Hr’g Tr. 12 (discussing late-arriving parties and 19 Judge Burkhardt also addressed the written arguments presented by the Non- 20 Compliant Parties and their Counsel in their OSC Response. Counsel argued that: (1) 21 Counsel and the Non-Compliant Parties did not believe that guarantors had to attend the 22 mandatory settlement conference, (OSC Response ¶ 1); (2) many Non-Compliant Parties’ 23 cases nevertheless settled, (id. ¶ 2); (3) even though several Non-Compliant Parties did not 24 file excusal motions they nonetheless provided various compelling reasons for non- 25 attendance, (id. ¶ 3); (4) several Non-Compliant Parties submitted declarations pursuant to 26 the OSCs explaining why they did not attend, (id. ¶ 4); (5) counsel was unable to 27 communicate with several Non-Compliant Parties, (id. ¶¶ 5–6); and (6) “[d]ue to the 28 extremely large group of parties represented, it was impossible to gather information from 5 12cv665 JLS (JLB) Lead Case 1 each individual party as to whether they could or could not appear in order to request 2 permission, in advance, to be excused from attendance,” (id. ¶ 8). Judge Burkhardt did not 3 find these arguments persuasive, addressing them as follows: (1) “The order I issued on 4 February 22nd was specific and clear as to . . . the dates and the start times” of the 5 settlement conference and was “also clear that each party was to personally appear on the 6 date specified,” (OSC Hr’g Tr. 5, 8–9); (2) regardless whether a non-appearing party’s case 7 ultimately settled, the “settlement conference was delayed by almost two hours” due to the 8 Non-Compliant Parties’ noncompliance, (id. at 6, 10–11); (3) no Non-Compliant Parties 9 filed an excusal motion—the sole mechanism set forth in the Attendance Order for 10 requesting excusal—and Judge Burkhardt noted all reasons for non-attendance conveyed 11 at the MSC, (id. at 8–9); (4) Judge Burkhardt carefully considered each declaration filed 12 after the OSCs, (id. at 10–16); and (5) Counsel had adequate time both to identify the 13 parties with faulty contact information and to communicate to Judge Burkhardt any 14 issues—or potential issues—regarding any party’s attendance, (id. at 16–17). The Court 15 is satisfied that Judge Burkhardt’s reasoning as to each of the Non-Compliant Parties is in 16 no way clear error. 17 Nor is the Court moved by the Non-Compliant Parties’ arguments set forth in the 18 Sanctions Appeal. The Non-Compliant Parties generally argue that the relevant sanctions 19 should be set aside because: (1) many parties speak “English as a second language, do not 20 understand the court processes and clearly, despite being told they HAD TO APPEAR on 21 repeated occasions, did not believe they ALL needed to appear,” (Sanctions Appeal ¶ 2); 22 (2) several parties, despite failing to appear, nonetheless settled their cases either through 23 personal or company representatives, (id. ¶ 4); (3) many Non-Compliant Parties, despite 24 failing to appear, were represented by individuals who worked to settle claims on their 25 behalf, (id. ¶¶ 6, 8, 12); (4) both sanctioned counsel only learned after the settlement 26 conference that they did not have current contact information for several defendants, (id. 27 ¶¶ 9–10); and (5) three Non-Compliant Parties who received $150 sanctions and one Non- 28 Compliant Party who received a $50 sanction committed no more than “technical 6 12cv665 JLS (JLB) Lead Case 1 violations of the rules set forth in the court’s order,” “were diligent in working hard all day 2 long to try to resolve their cases,” and therefore the imposed sanctions are “punitive and 3 unreasonable under the circumstances,” (id. ¶ 14). 4 Judge Burkhardt, and now this Court, have already addressed the inadequacy of most 5 of these arguments. For further clarification: (1) parties are not excused from compliance 6 with court orders merely because they speak English as a second language; (2) and (3) 7 Judge Burkhardt, in determining the amount of sanctions imposed, accounted for the fact 8 that some parties settled despite not appearing at the MSC; however, the overall effect of 9 the Non-Compliant Parties’ failure to attend was to substantially delay and adversely affect 10 the compliant parties; (4) failing to update contact information does not excuse a party from 11 compliance with a court order; and (5) Judge Burkhardt considered the circumstances of 12 all parties who failed to attend and who arrived late, excusing some and lowering the 13 sanctions amount for others—this, in fact, is not punitive but instead highly reasonable. 14 Given the foregoing, Judge Burkhardt’s imposed monetary sanctions as to each of 15 the Non-Compliant Parties is not clear error and therefore Defendants’ appeal of Judge 16 Burkhardt’s imposition of monetary sanctions is DENIED. 17 B. Counsel 18 In addition to Counsel’s OSC Response argument that “[d]ue to the extremely large 19 group of parties represented, it was impossible to gather information from each individual 20 party as to whether they could or could not appear in order to request permission, in 21 advance, to be excused from attendance,” (OSC Response ¶ 8), Counsel submitted a 22 declaration on her behalf,1 orally submitted several additional arguments to Judge 23 Burkhardt at the OSC Hearing, and reiterated several prior arguments in her Sanctions 24 Appeal. Counsel argued that: it was her “belief and understanding” that attendance at the 25 26 27 28 Then-counsel Schiller, now disbarred, (see, e.g., OSC Hr’g Tr. 2), also submitted a declaration alleging that he contacted each client by email multiple times, and also told other relevant counsel to contact the clients. However, because Mr. Schiller did not appear at oral argument to offer any additional reasons why sanctions should not be imposed against him, (id.), the analysis in this Section regarding Ms. Lacey applies with equal, if not more, force to Mr. Schiller. 1 7 12cv665 JLS (JLB) Lead Case 1 MSC was only required for “the principal of each defendant entity”; Counsel is “the third 2 in line of attorneys as local counsel, and I’m only as good as the information I’m provided 3 with”; “[t]hese parties do not make an effort to keep their attorneys apprised of how to 4 reach them”; “the people that did not show up did not give us notice that they would not 5 be there”; “the lion’s share of the work was falling on me” and despite “strenuous effort to 6 contact people” Counsel only “ha[d] limited resources”; Counsel “assumed” that no contact 7 from the nonresponsive parties meant they would attend the settlement conference; and 8 Counsel was unaware that guarantors were “parties” to the litigation because she “had not 9 seen the third amended complaint” due to ECF, and apparently secretarial, issues. (OSC 10 Hr’g Tr. 18–23; see Sanctions Appeal ¶¶ 1–3.) 11 The Court need not spend much time on these arguments. Although the Court 12 recognizes that Counsel signed on to a complex and challenging case, (see OSC Hr’g Tr. 13 21 (Judge Burkhardt noting that “I don’t want you to think that I’m unsympathetic to the 14 challenges of this case and the challenges particularly of being local counsel on a case like 15 this”)), it does not change the facts that Counsel was responsible for ensuring client 16 compliance with the Attendance Order and Counsel had ample time to communicate with 17 the Court regarding the clients with whom she was unable to reach or from whom she had 18 not heard any response. Especially concerning is Counsel’s argument that she did not 19 believe guarantors were “parties” within the meaning of the Attendance Order, and that she 20 had not seen the Third Amended Complaint. An attorney serving as local counsel acts “as 21 co-counsel with the authority to act as attorney of record for all purposes.” Civ. L.R. 22 83.3(c)(5) (emphasis added). 23 responsibility is reading documents relevant to the litigation. The Settlement Attendance 24 Order states: “Personal Appearance of Parties Required: All parties, adjusters for 25 insured defendants, and other representatives of a party having full settlement authority as 26 explained below, and the principal attorneys responsible for this litigation, must be present 27 in person . . . .” (Attendance Order 2 (emphasis original).) Notably, the use of the 28 conjunctive “and” in the Settlement Attendance Order unites all members of the list such With authority comes responsibility. Part of that 8 12cv665 JLS (JLB) Lead Case 1 that it should have been abundantly clear that anyone meeting any of the list’s 2 classifications had to appear in person. And even if Counsel had any questions regarding 3 the specifics of the Settlement Attendance Order she could have easily contacted Judge 4 Burkhardt’s chambers for clarification. Most egregious, however, is Counsel’s responsive 5 argument at the OSC Hearing that she did not believe “[g]uarantors were parties” because 6 Counsel had not read the operative complaint.2 This is clearly insufficient cause for failure 7 to comply with a Court Order. 8 C. Conclusion 9 At the Order to Show Cause Hearing Judge Burkhardt summarized as follows: 10 “There were a lot of people here from a lot of places at great expense with very serious 11 work to conduct, and the fact that we did not know who was and wasn’t going to be present 12 was a real impediment to a successful execution of the mandatory settlement conference, 13 and the responsibility for that lies both with the actual parties and with counsel.” (OSC 14 Hr’g Tr. 17.) The Court agrees. Defendants’ appeal of Judge Burkhardt’s imposition of 15 monetary sanctions is DENIED. 16 II. Terminating Sanctions 17 Judge Burkhardt recommended terminating sanctions against twenty Defendants: 18 Francois Alvandi; Natalie Alvandi; Rajesh Arora; Ghallab Brothers Inc.; Ibrahim Ghallab; 19 Basel Hassounch; Behzad Kianmahd; Kalur Kishan; Ruchisys, Inc.; Ammar Maaytah; 20 Randa Maaytah; Anit Natt; Muna Quasqas; Nader Sahih; Ruchira Sharma; Hamza Shilleh; 21 Kotsai Wang; Rebecca Zomorodian; Marie Zorenkelian; and Toros Zorenkelian. 22 (Sanctions Order 1–5.) Of these Defendants, many have since settled and are now 23 terminated from the docket, thus leaving the following five Defendants who are still active 24 25 26 27 28 Judge Burkhardt noted: “And I’m sorry, Ms. Lacey. I can’t accept as an excuse that you’re not familiar with the pleading in the case. There are other ways to get things off the docket. If you can’t figure out how you get -- file a notice of appearance and get CM/ECF notification. And you can come to the Court. It’s a publicly filed document. You are local counsel. And for you to stand before me and tell me that your explanation for not knowing who the parties are is you haven’t had access to the operative complaint in the case in which you’re local counsel, it doesn’t sit well.” (OSC Hr’g Tr. 23.) 2 9 12cv665 JLS (JLB) Lead Case 1 in the litigation: Rajesh Arora; Basel Hassounch; Behzad Kianmahd; Anit Natt; Nader 2 Sahih (together, “the Remaining Defendants”). 3 previously had sanctions imposed on them and were “give[n] notice . . . that further failure 4 to comply with discovery orders or to meaningfully participate in discovery, even absent 5 an order to compel, may result in entry of default judgment against them and dismissal of 6 their counterclaims pursuant to Rule 37(b).” (December 14, 2015 Order 16–17 (noting that 7 Remaining Defendants were part of the least culpable subset of the three Defendant subsets 8 addressed in the Order, but nonetheless did “not escape all responsibility” for violations of 9 “at least two discovery orders”).) Each of the Remaining Defendants 10 Counsel argues that terminating sanctions are inappropriate as to any of the 11 Remaining Defendants. In sum: (1) all the Remaining Defendants are solely guarantors, 12 (see OSC Response ¶¶ 2–3); (2) all the Remaining Defendants sent a representative to the 13 MSC even though they did not appear in person, (see id. ¶¶ 6–7);3 and (3) Basel Hassounch 14 “has not been a named business partner” for the entity at issue in the litigation “for several 15 years,” (id. ¶¶ 2–3). 16 Defendants, the Court addresses all together as follows. Despite slight distinctions between some of the Remaining 17 Although all federal courts have the inherent power to dismiss a case in its entirety, 18 Aloe Vera of Am., Inc. v. United States, 376 F.3d 960, 964–65 (9th Cir. 2004), such 19 dismissal, “[b]ecause of [its] very potency, . . . must be exercised with restraint and 20 discretion,” Chambers v. NASCO, Inc., 501 U.S. 32, 44 (1991). When deciding whether 21 to impose dismissal or default, courts “must” weigh five factors: 22 (1) the public’s interest in expeditious resolution of litigation; (2) the court’s need to manage its docket; (3) the risk of prejudice to the defendants; (4) the public policy favoring disposition of cases on their merits; and (5) the availability of less drastic sanctions. 23 24 25 26 27 3 28 Judge Burkhardt indicated that only four of the five remaining Defendants—all but Rajesh Arora—had a representative present at the MSC. (Sanctions Order 2–4.) 10 12cv665 JLS (JLB) Lead Case 1 Malone v. U.S. Postal Serv., 833 F.2d 128, 180 (9th Cir. 1987). Due process requires that 2 courts not dismiss a case as a sanction when “failure to comply is due to circumstances 3 beyond the recalcitrant’s control.” See Sigliano v. Mendoza, 642 F.2d 309, 310 (9th Cir. 4 1981). However, when counsel or a party acts “willfully or in bad faith” in failing to 5 comply with court orders, or acts with flagrant disregard of those orders, the Ninth Circuit 6 has “specifically encouraged dismissal.” 7 “disobedient conduct not shown to be outside the control of the litigant.” Virtual Vision, 8 Inc. v. Praegitzer Indus., Inc., 124 F.3d 1140, 1143 (9th Cir. 1997) (quoting Henry v. Gill 9 Indus., 983 F.2d 943, 948 (9th Cir. 1993)). Id. Willfulness or bad faith conduct is 10 In the present case, after weighing the above-listed factors, the Court concludes that 11 at this time issuing terminating sanctions as to the Remaining Defendants is too severe. 12 Although the Remaining Defendants were previously warned that further failure to comply 13 with the discovery process could result in terminating sanctions, they were the least 14 egregious violators of the groups sanctioned in the Court’s December 15, 2015 Order. 15 Further, all are guarantors, and at least four of the five sent a representative to the MSC on 16 their behalf. Finally, given the analysis set forth above in Section I.B, supra, the Court 17 cannot be completely sure what information the Remaining Defendants received from 18 Counsel prior to the MSC. Taken together, these facts militate in favor of the Court not 19 issuing terminating sanctions at this time. 20 To be clear: the Court finds that the Remaining Defendants did, in fact, violate a 21 Court Order, thus affecting many other parties’ and Judge Burkhardt’s ability to be able to 22 effectively conduct the MSC. And this is the second time the Remaining Defendants have 23 been sanctioned in this litigation. Accordingly, the Remaining Defendants would be well 24 advised to reflect on the familiar idiom “three strikes and you are out.” 25 /// 26 /// 27 /// 28 /// 11 12cv665 JLS (JLB) Lead Case 1 CONCLUSION 2 The Court is cautiously optimistic that Counsel and the Remaining Defendants will 3 not further impede the litigation or violate any other Court orders. However, the Court 4 GIVES NOTICE to all sanctioned Defendants that further failure to comply with Court 5 orders or to meaningfully participate in discovery, even absent an order to compel, SHALL 6 result in entry of judgment against them and dismissal of their counterclaims pursuant to 7 Rule 37(b). 8 Accordingly, Defendants’ appeal from Judge Burkhardt’s Sanction Order is 9 DENIED as to the monetary sanctions. The Court ORDERS that, on or before 4 weeks 10 from the date when this Order is electronically docketed, all sanctions set forth in Judge 11 Burkhardt’s Order be paid to the Miscellaneous Fines, Penalties and Forfeitures, Not 12 Otherwise Classified, fund of the United States Treasury. (Sanctions Order 5–6; see Civ. 13 L. R. 83.1.) To the extent sanctioned by Judge Burkhardt, Defendants and Counsel must 14 file a Notice of Payment on or before 4 weeks from the date when this Order is 15 electronically docketed verifying that sanctions were paid. Failure to comply with this 16 Order shall constitute grounds for further sanctions. 17 The Court DECLINES to issue terminating sanctions at this time. 18 IT IS SO ORDERED. 19 Dated: November 29, 2016 20 21 22 23 24 25 26 27 28 12 12cv665 JLS (JLB) Lead Case
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