Judge slams Davis Wright for failing to mention settled, adverse caselaw, orders $40K in sanctions

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A federal judge has ordered Davis Wright Tremaine and one of its partners to pay more than $40,000 in sanctions for failing to mention “long-standing, settled caselaw” that barred the court from issuing an injunction sought by the law firm.

U.S. District Judge Michael McShane of the District of Oregon sanctioned the law firm and partner Mark Hutcheson in a Dec. 16 order that required them to pay $40,625 for their litigation opponents’ legal fees.

Law360 and the Oregonian have coverage.

McShane said the failure to disclose was “an attempt to deceive the court via a material omission.”

Davis Wright had represented St. Charles Health System Inc. in Bend, Oregon, in a bid to prevent a strike by 156 medical technicians and therapists.

Hutcheson sought an injunction to prevent the strike, even though a district court has no jurisdiction to issue an injunction in such circumstances, McShane said. Only the National Labor Relations Board may seek an injunction to prevent an unfair labor practice under the National Labor Relations Act, McShane soon learned.

“Had the defense not cobbled together a quick brief, the court was prepared to issue a completely illegal order based on the law as presented by the hospital; law the court later learned to be a fiction,” McShane said.

Hutcheson and Davis Wright “essentially argue that although in hindsight they could have done more to alert the court of binding, contrary precedent, their actions are not sanctionable because they were merely arguing for an ‘extension’ of existing caselaw and were unable to identify any case ‘on all fours’ with the underlying facts here,” McShane wrote. “This explanation is meritless.”

Hutcheson argued that he thought that he was entitled to seek an injunction “under this extreme and once-in-a-century pandemic situation,” and the pleading had focused on perceived harm, rather than jurisdictional issues.

McShane found that the motion was filed in bad faith for an improper purpose. The goal, McShane said, was to gain a valuable negotiating chip in hospital discussions with the union representing the workers.

Hutcheson and the law firm did not immediately respond to the ABA Journal’s request for comment.

The case is St. Charles Health System Inc. v. Oregon Federation of Nurses and Health Professionals.

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