7th Circuit Affirms $80K Sanction: If Lawyer Can't Pay, Bankruptcy Is Next Step
Known for his sometimes-blistering views on attorney competency issues, Judge Frank Easterbrook of the Chicago-based 7th U.S. Circuit Court of Appeals takes something of a kindly tone, initially, in an opinion today upholding an $80,000 sanction against an impoverished attorney.
But, writing on behalf of a three-judge panel, Easterbrook nonetheless finds that a lawyer who pursued litigation over a labor union election based on a number of “fanciful” allegations is responsible for the defendants’ legal costs.
An argument by attorney James Gordon Banks that he has only $2,000, his clothing, his watch and his wedding band—and no malpractice insurance—is irrelevant to a claim for sanctions for vexatious litigation under 28 U.S.C. § 1927, the judge explains. Although a lawyer’s ability to pay is properly taken into account in a sanctions award under Rule 11 of the Federal Rules of Civil Procedure, it is not considered under Section 1927 because the fee-shifting statute essentially makes vexatious litigation a type of intentional tort.
Thus, just as “[a] physician only four years out of medical school does not get a discount on his malpractice judgments; Banks’s observation that he was only four years out of law school when he took this case does not give him a license to injure others by making unsupported assertions and clinging to them long after their falsity has been revealed,” the opinion states. “This would be plain enough if Banks had injured his own client by malpractice; the proposition is no different when he injures his client’s adversary.”
As the eight-page opinion nears its conclusion, Easterbrook winds up for a final zinger:
If Banks really can’t afford to pay the $80,000 sanction, his next step is a bankruptcy filing, the judge writes. And “if Banks really is a bad lawyer (as he depicts himself), and is poor because people are not willing to pay much, or at all, for his services, then he should turn from the practice of law to some other endeavor where he will do less harm.”
Banks declined to comment at this time when contacted by the ABA Journal.
Updated at 11:55 p.m. on March 1 to include Banks’ response.
