Nick v. Morgan's Foods, Inc.

270 F.3d 590 (8th Cir. 2001)

 

RULE:

An appellate court reviews sanction orders under the abuse of discretion standard. Judicial discretion is the responsible exercise of official conscience on all the facts of a particular situation, taking into consideration the purpose of the exercised power. Part of the purpose of the sanctioning power is to control litigation and to preserve the integrity of the judicial process.

FACTS:

Appellee woman filed suit against the appellant company. The parties consented to alternate dispute resolution (ADR). Pursuant to a court order, at least seven days before the first ADR conference, each party had to supply the mediator with a memorandum presenting a summary of the disputed facts, and all parties had to attend all mediation conferences and participate in good faith. The company did not file the memorandum. The company's in-house counsel did not attend the ADR conference. The ADR conference ended without a settlement having been reached. The United States District Court for the Eastern District of Missouri sanctioned the company and its outside counsel. The company moved for reconsideration of the order. The district court denied the motion for reconsideration and imposed additional sanctions against the company for filing a frivolous motion.  Appellant company challenged the order which denied its motion to reconsider sanctions imposed against it and its outside counsel for failure to participate in good faith in court-ordered alternate dispute resolution with appellee woman, and for vexatiously increasing the costs of litigation.

ISSUE:

Did the district court abuse its discretion in imposing monetary sanctions against appellant? 

ANSWER:

No.

CONCLUSION:

On appeal, the order of the district court was affirmed. The appellate court found that the district court did not abuse its discretion in imposing monetary sanctions against the company for its lack of good faith participation in the ADR process, for its failure to comply with the district court's order, and for vexatiously increasing the costs of litigation by filing a frivolous motion for reconsideration.

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