melody a. kramer, sbn 169984 kramer law office, inc. … · 2014-04-14 · my business address is...

1.Case No. 13CV2741 BEN RBB

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MELODY A. KRAMER, SBN 169984 KRAMER LAW OFFICE, INC. 9710 Scranton Road, Suite 160 San Diego, California 92121 Telephone (855) 835-5520 [email protected] Attorney for Plaintiff STEINAR MYHRE

UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF CALIFORNIA

STEINAR MYHRE,

Plaintiff v.

SEVENTH-DAY ADVENTIST CHURCH REFORM MOVEMENT AMERICAN UNION INTERNATIONAL MISSIONARY SOCIETY, a New Jersey corporation; INTERNATIONAL MISSIONARY SOCIETY SEVENTH-DAY ADVENTIST CHURCH REFORM MOVEMENT GENERAL CONFERENCE, a California corporation; and DOES 1 – 100,

Defendants.

) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

Case No. 13cv2741 BEN RBB

PLAINTIFF’S MOTION FOR SANCTIONS PURSUANT TO F.R.CIV.P. RULE 11 AGAINST DEFENDANT MIAMI DADE AREA SEVENTH-DAY ADVENTIST CHURCH REFORM MOVEMENT, INTERNATIONAL MISSIONARY SOCIETY INC. (“IMS-MIAMI”) Date: May 27, 2014 Time: 10:30 a.m. Courtroom 5A Honorable Roger T. Benitez

)

//

Case 3:13-cv-02741-BEN-RBB Document 55 Filed 03/19/14 of 4


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Plaintiff STEINAR MYHRE hereby moves, pursuant to Fed.R.Civ.P. Rule 11,

for sanctions against Defendant Miami Dade Area Seventh-Day Adventist Church

Reform Movement, International Missionary Society Inc., a Florida corporation

(“IMS-Miami”) because –

Defendant IMS-Miami’s [and four other Defendants’] Motion to

Dismiss or Transfer (Doc. #34) and its supporting documents contain

such frivolous and baseless arguments as to be violative of

Fed.R.Civ.P. Rule 11’s prohibition on frivolous pleadings;

This includes the frivolous claim that this Florida corporation, which

both claims to have a principal place of business in California, and be

separate and distinct from its co-defendants, is entitled to have this case

moved to either Colorado or Georgia.

As explained in the accompanying Memorandum of Points and Authorities, and

supporting evidence, Plaintiff is respectfully requesting that the Court sanction

Defendant IMS-Miami and its counsel in an amount of reasonable attorney fees of at

least $3,575.00.

This Motion is based on the concurrently filed Memorandum of Points and

Authorities, Declaration of Melody A. Kramer, and such other portions of the court

file the Court deems necessary and appropriate to consider.

DATED this Wednesday, March 19, 2014.

STEINAR MYHRE, Plaintiff

Melody A. Kramer By Melody A. Kramer, Esq. Kramer Law Office, Inc. Attorney for Plaintiff [email protected]



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PROOF OF SERVICE

I, Melody A. Kramer, declare: I am and was at the time of this service

working within in the County of San Diego, California. I am over the age of 18 year

and not a party to the within action. My business address is the Kramer Law Office,

Inc., 9710 Scranton Road, Suite 160, San Diego, California, 92121. On Wednesday, March 19, 2014, I served the following documents:

PLAINTIFF’S MEMORANDUM OF POINTS & AUTHORITIES IN SUPPORT OF MOTION FOR SANCTIONS PURSUANT TO

F.R.CIV.P. RULE 11 AGAINST DEFENDANT MIAMI DADE AREA SEVENTH-DAY ADVENTIST CHURCH REFORM MOVEMENT,

INTERNATIONAL MISSIONARY SOCIETY INC. (“IMS-MIAMI”)

DECLARATION OF MELODY A. KRAMER IN SUPPORT OF PLAINTIFF’S MOTION FOR SANCTIONS PURSUANT TO

F.R.CIV.P. RULE 11 AGAINST DEFENDANT MIAMI DADE AREA SEVENTH-DAY ADVENTIST CHURCH REFORM MOVEMENT,

INTERNATIONAL MISSIONARY SOCIETY INC. (“IMS-MIAMI”)

on the following parties or their counsel:

Paul Hanna Lori B. Wade Manning & Kass Ellrod, Ramirez, Trester LLP 15th Floor at 801 Tower 801 S. Figueroa Street Los Angeles, CA 90017 FAX 213-624-6999 [email protected] [email protected]

Attorneys for Defendant Seventh-Day Adventist Church Reform Movement American Union International Missionary Society, Inc.; The Seventh-Day Adventist Church Reform Movement American Union International Missionary Society, a corporation organized under the laws of the State of Texas; Defendant The Seventh-Day Adventist Church Reform Movement American Union IMS, Inc.; Defendant Miami Dade Area Seventh-Day Adventist Church Reform Movement, International Missionary Society Inc.; and Defendant The Seventh-Day Adventist Church Reform Movement American Union International Missionary Society



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Patrick John Stark Christofer Chapman Stark, Friedman & Chapman LLP 404 E. 1st Street #176 Long Beach, CA 90802 FAX 562-436-9415 [email protected] [email protected]

Attorneys for Defendant International Missionary Society Seventh-Day Adventist Church Reform Movement General Conference; and Defendant Tampa Bay Area Seventh Day Adventist Church Reform Movement, International Missionary Society Inc.

by the following method of service:

__x__ (Email--Pleadings Filed with the Court) Pursuant to Local Rules, I

electronically filed this document via the CM/ECF system for the United States

District Court for the Southern District of California.

____ (U.S. Mail) I mailed a true copy of the foregoing documents to a mail

address represented to be the correct mail address for the above noted addressee.

I declare that the foregoing is true and correct, and that this declaration was

executed on Wednesday, March 19, 2014, in San Diego, California.

/s/ Melody A. Kramer

Melody A. Kramer


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STEINAR MYHRE,

Plaintiff v.


Defendants.

) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )


PLAINTIFF’S MEMORANDUM OF POINTS & AUTHORITIES IN SUPPORT OF MOTION FOR SANCTIONS PURSUANT TO F.R.CIV.P. RULE 11 AGAINST DEFENDANT MIAMI DADE AREA SEVENTH-DAY ADVENTIST CHURCH REFORM MOVEMENT, INTERNATIONAL MISSIONARY SOCIETY INC. (“IMS-MIAMI”) Date: May 27, 2014 Time: 10:30am Courtroom 5A Honorable Roger T. Benitez

)

Case 3:13-cv-02741-BEN-RBB Document 55-1 Filed 03/19/14 Page 1 of 9


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INTRODUCTION

Defendant IMS-Miami’s1 Motion to Dismiss for Lack of Subject Matter

Jurisdiction or Improper Venue; or in the Alternative, to Transfer (Doc. #34) is

violative of Fed.R.Civ.P. Rule 11’s prohibitions on frivolous arguments.

Specifically, Defendant IMS-Miami claims to be a local church, claims to be both

incorporated in, and have a principal place of business in Florida. It also claims to

be a separate and distinct entity from its co-defendants. However, it requests this

Court to transfer this case, not to Florida, but to states with which it has

acknowledged no connections - Colorado or Georgia.

This is the type of frivolous gamesmanship that Rule 11 is intended to

prohibit. Plaintiff has provided statutorily required notice in advance of the filing of

this Rule 11 motion, requesting that Defendant IMS-Miami either withdraw its

Motion or stipulate to being part of a joint enterprise with the other defendants in this

case (defendants’ whose claims IMS-Miami is parroting), but they have failed and

refused to do so.

Defendant IMS-Miami and its counsel should be sanctioned in the form of

reasonable attorney fees and costs relating to the filing of this motion, as well as the

costs related to additional pleadings related to this frivolity, estimated to be at least

$3,575.00.

FACTUAL SUMMARY

Defendant IMS-Miami claims that “the evidence is that . . . IMS MIAMI . . .

ha[s] observed corporate formalities” and that there “is an insufficient basis upon

which to pierce the corporate veil.” Doc. #34-1, pg. 2:7-12. No such evidence is

presented in the motion, of course, but that is the least of the pleadings problems.

IMS-Miami argues application of caselaw stating that “a corporation is

1 Defendant Miami Dade Area Seventh Day Adventist Church Reform Movement, International Missionary Society, Inc. (a Florida corporation) (“IMS-Miami”)



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typically a citizen of two states for determining the existence of diversity

jurisdiction; the state of incorporation and the state in which it has its principal place

of business.” Doc. #34-1, pg. 4:14-16. IMS-Miami says it is a Florida corporation

with a principal place of business in Florida (Doc. #34-1, pg. 12:14-15).

Meanwhile, in discovery responses, IMS-Miami has stated in discovery

responses that “Responding Party is a local church,” but also say its geographical

area of operations is the “United States and Puerto Rico.” Kramer Decl., ¶ 6, Exh.

B. Then, despite claimed separateness, discovery responses for IMS-Miami were

verified by Mr. Petkov as “President of Seventh-Day Adventist Church Reform

Movement American Union, a party to this action, and am authorized to make this

verification . . . on behalf of its local churches . . .” even though Mr. Petkov is not

identified as an officer or director of IMS-Miami. Kramer Decl. ¶ 6, Exh. B (last

page), and Doc. #34-3, Exh. G.

However, IMS-Miami argues that this case against this supposedly separate

and distinct entity, supposed merely a local church, citizen of Florida, is entitled to

this case being transferred to either Colorado or Georgia, jurisdictions with which

this Defendant does not claim to have connection of any sort!

And as yet one more example of frivolity, one shared with its co-defendants

on its joint Motion, Defendant IMS-Miami also plays games with identification of

witnesses for its “convenience” argument. Defendant IMS-Miami claims that “the

attached Declaration of Tzvetan Petkov identifies the relevant witnesses as to the

issues set forth in plaintiff’s first amended complaint.” Doc. #34-1, pg. 17:18-19.

This claim of relevant witnesses is directly contrary to evidence in their possession,

identification of additional witnesses made within the Amended Complaint (see Doc.

#15, at least ¶¶ 39, 45, 46, 52, 58, 60, 65, 66, 73-75, 77, 80, 84, 86, 95, 100, 102,

105, 106, 112, 114-117, 119, 136, 144, 152-154, 177, 186, and 194-196) and

Plaintiff’s Initial Disclosures which identify 124 witnesses by name (many with

addresses also listed), and by categories of witnesses also. Few of these witnesses



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are located in Georgia; many are located in California and Florida and abroad.

Kramer Decl. ¶ 4. Furthermore, their supposed witness list is focused on a single

telephone conference which is known, as per official meeting minutes of that

conversation, to have had many more participants than the selected list given.

Compare AUNJ-000159-165 with Mr. Petkov’s first declaration (Doc. #4-2) and

second declaration (Doc. #31-2). See Kramer Decl. ¶ 5, Exh. B.

By letter dated February 24, 2014, Plaintiff’s counsel provided Defendant’s

counsel with formal notice per Fed.R.Civ.P. Rule 11, including a draft Rule 11

motion in substantially the same form as that now being filed. See Kramer Decl. ¶ 4,

Exh. A. Defendant IMS-Miami and its counsel have nonetheless failed and refused

to take any corrective action whatsoever. Their only contact with Plaintiff’s counsel

regarding the draft motion was to ask for a week extension of the safe harbor

provision, a request made just hours prior to expiration of that period of time by new

counsel in Mr. Hanna’s office, Ms. Lori Wade, and two days before this motion was

filed. Plaintiff’s counsel did not agree to an extension due to the fact that she

continues to have a briefing deadline in less than two weeks to oppose the challenged

motion, and further time would just incur more time and expense as a result of IMS-

Miami’s frivolous arguments . Kramer Decl. ¶ 5.

As a result of IMS-Miami’s frivolous motion, Plaintiff’s counsel has had to

expend approximately 3 hours in sending informal letters, reviewing documents, and

preparing the draft motion and cover letter. It has taken another 1 hour2 to finalize

and file this motion, and depending on the nature of any opposition briefing thereto,

spend another 2 hours reviewing and preparing a reply thereto. Furthermore,

Plaintiff has had to engage in jurisdictional discovery of IMS-Miami, and, because

they have not properly responded thereto, file a motion to compel the same, requiring

2 This time estimate is actually lower than that in the draft Rule 11 motion in that

due to the frivolous nature of other defendants’ filings, sheer repetition has increased Plaintiff’s counsel’s speed in addressing these matters.



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an estimated additional 2 hours directly related to IMS-Miami’s frivolous positions

in its Motion. In addition, Plaintiff’s counsel is in the process of preparing an

Opposition brief to IMS-Miami’s frivolous motion, including assembling the

necessary information to rebut the frivolous claims made therein. This work is

anticipated to require approximately 5 hours relating directly to this Defendant, in

joint briefings opposing the Motion. Kramer Decl. ¶ 8.

At Plaintiff’s counsel reasonable hourly rate of $275/hour, that results in no

less than $3,575.00 of reasonable attorney fees that Defendant IMS-Miami should be

required to pay to Plaintiff and his counsel as a result of this sanctionable conduct.

Kramer Decl. ¶ 9. Plaintiff’s counsel is a 20+ year experienced trial counsel, a

graduate of the University of Nebraska College of Law and receiving the Order of

the Barrister honor upon graduating. She is licensed to practice law in all courts in

California, licensed to practice law in Nebraska (currently on inactive status), and

admitted to practice before the United States District Courts for Southern California,

Central California, Northern California, Nebraska, Eighth Circuit Court of Appeals

and the Federal Circuit Court of Appeals, in addition to many pro hac vice

appearances in other states. She spent a recent seven+ years exclusively handling

complex civil litigation in federal courts. Her reasonable hourly rate for this type of

litigation is $275/hour which is equal or less to similarly qualified counsel in her

geographic area. Kramer Decl. ¶ 10.

ARGUMENT

Fed.R.Civ.P. Rule 11 allows a Court to sanction attorneys and/or parties for

making frivolous legal claims in pleadings. Legal claims require reasonable inquiry

and must be warranted by existing law or be non-frivolous arguments for extension

of existing law. Likewise, factual contentions must have evidentiary support.

While there is certain leeway to plead alternative legal theories, Defendant

IMS-Miami is veering off into the pleading of materially inconsistent claims of fact.



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That is impermissible, frivolous, and sanctionable under Rule 11. I. RULE 11 ALLOWS A COURT TO SANCTION ATTORNEYS OR

PARTIES FOR MAKING FRIVOLOUS LEGAL CLAIMS.

A. Legal and factual claims made to the Court must be warranted by existing law or be non-frivolous.

By presenting to the court a pleading, written motion, or other paper — whether by signing, filing, submitting, or later advocating it — an attorney or unrepresented party certifies that to the best of the person's knowledge, information, and belief, formed after an inquiry reasonable under the circumstances:

(1) it is not being presented for any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation;

(2) the claims, defenses, and other legal contentions are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law or for establishing new law;

(3) the factual contentions have evidentiary support or, if specifically so identified, will likely have evidentiary support after a reasonable opportunity for further investigation or discovery; . . .

Fed.R.Civ.P. Rule 11(b).

Defendant IMS-Miami cannot claim it is a separate and distinct entity while

simultaneously parroting the precise claims of the other defendants from whom they

claim to be separate and distinct. They cannot sit in Florida and with a straight face

say that entitles them to transfer of this case to Colorado or Georgia.

Defendant IMS-Miami cannot offer almost identical discovery responses,

“verified” by the same person (one of whom is not even an officially listed officer of

IMS-Miami), and still claim they are separate and distinct.

Such a position makes a mockery out of the legal process. If they want to

maintain the argument that they are separate and distinct, they must act like it.

Otherwise, they must agree to the obvious, that they are neither local churches nor

are they separate and distinct from the rest of the defendants in this case.



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Defendant IMS-Miami, and their counsel, have proferred this logically

impossible set of claimed facts and arguments for the obvious reason of engaging in

the improper purposes of delay and increasing costs to Plaintiff. This should be

sanctioned.

B. The Court can sanction attorneys or parties responsible for Rule 11 violations.

(1) In General.

If, after notice and a reasonable opportunity to respond, the court determines that Rule 11(b) has been violated, the court may impose an appropriate sanction on any attorney, law firm, or party that violated the rule or is responsible for the violation. Absent exceptional circumstances, a law firm must be held jointly responsible for a violation committed by its partner, associate, or employee.

(2) Motion for Sanctions.

A motion for sanctions must be made separately from any other motion and must describe the specific conduct that allegedly violates Rule 11(b). The motion must be served under Rule 5, but it must not be filed or be presented to the court if the challenged paper, claim, defense, contention, or denial is withdrawn or appropriately corrected within 21 days after service or within another time the court sets. If warranted, the court may award to the prevailing party the reasonable expenses, including attorney's fees, incurred for the motion. . . .

(4) Nature of a Sanction.

A sanction imposed under this rule must be limited to what suffices to deter repetition of the conduct or comparable conduct by others similarly situated. The sanction may include nonmonetary directives; an order to pay a penalty into court; or, if imposed on motion and warranted for effective deterrence, an order directing payment to the movant of part or all of the reasonable attorney's fees and other expenses directly resulting from the violation.

Fed.R.Civ.P. Rule 11(c)(1), (2), and (4).

Under the standards here, Defendant IMS-Miami and their counsel have



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liability under the Rule. They have made the absurd claim that they are “local

churches” covering a geographic area of “the United States and Puerto Rico,” are

incorporated in Florida, have a principal places of business in Florida, but that they

are separate and distinct entities that are entitled to having this case transferred to

Colorado or Georgia.

Coupled with the blatant misrepresentation of the contents of the Amended

Complaint and discovery responses that fully demonstrate the joint nature of these

defendants with their co-defendants, this is a case particularly appropriate for

sanctions.

In contrast to the Rule 11 motion filed against Defendant IMS-GC3 (Doc. #50,

set for hearing on May 12, 2014), counsel’s involvement of sanctionable conduct is

right on par with his clients. Such internal inconsistencies cannot have escaped the

notice of counsel when he was signing the pleadings at issue. Even if counsel was

provided with some misrepresentations from his clients, he should have refused to

sign and present to the Court such a frivolous pleading as this. Thus, both Defendant

IMS-Miami should be sanctioned jointly and severally with their counsel.

CONCLUSION

For the reasons set forth above, Defendant respectfully requests the Court to

issue Rule 11 sanctions against Defendant IMS-Miami, in the form of attorney fees

and expenses necessitated in bringing this motion and relating extra efforts to

counter the frivolous pleading, or in other manner as deemed appropriate to the

Court.

3 Defendant International Missionary Society Seventh-Day Adventist Church

Reform Movement General Conference, a California corporation (“IMS-General Conference”)



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DATED this Wednesday, March 19, 2014.

Respectfully submitted, KRAMER LAW OFFICE, INC.

By: Melody A. Kramer

Melody A. Kramer, Esq. Attorney for Plaintiff E-mail: [email protected]



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STEINAR MYHRE,

Plaintiff v.


Defendants.

) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )


DECLARATION OF MELODY A. KRAMER IN SUPPORT OF PLAINTIFF’S MOTION FOR SANCTIONS PURSUANT TO F.R.CIV.P. RULE 11 AGAINST DEFENDANT MIAMI DADE AREA SEVENTH-DAY ADVENTIST CHURCH REFORM MOVEMENT, INTERNATIONAL MISSIONARY SOCIETY INC. (“IMS-MIAMI”) Date: May 27, 2014 Time: 10:30 a.m. Courtroom 5A Honorable Roger T. Benitez

)

//

//



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I, Melody A. Kramer, declare as follows:

1. I am not a party to the present action. I am over the age of eighteen. I

have personal knowledge of the facts contained within the following paragraphs, and

could and would competently testify thereto if called as a witness in a court of law.

2. I am the attorney of record for Plaintiff in the above-captioned case.

3. This declaration is being submitted in support of Plaintiff’s Motion For

Sanctions Pursuant To F.R.Civ.P. Rule 11 Against Defendant Miami Dad Seventh-

Day Adventist Church Reform Movement International Missionary Society) (“IMS-

Miami”).

4. On February 24, 2014, I sent a draft Rule 11 Motion and cover letter to

counsel for Defendant IMS-Miami, Mr. Hanna. The draft Rule 11 motion was in

substantially the same form as that now being filed. A true and correct copy of the

cover email, letter, and draft motion is attached hereto as Exhibit A.

5. Defendant IMS-Miami and its counsel have nonetheless failed and

refused to take corrective action. Their only contact with me regarding the draft

motion was to ask for a week extension of the safe harbor provision, a request made

just hours prior to expiration of that period of time by new counsel in Mr. Hanna’s

office, Ms. Lori Wade, and two days before this motion was filed. I did not agree to

an extension due to the fact that we have a briefing deadline in less than two weeks

to oppose the challenged motion, and further time would just incur more time and

expense as a result of IMS-Miami’s frivolous arguments.

6. Attached hereto as Exhibit B is a copy of Defendant IMS-Miami’s

Responses to Interrogatories, Set 1, and the subsequently provided verification

thereof by Mr. Petkov.

7. Despite claimed separateness, discovery responses for IMS-Miami

(Exhibit B) were verified by Mr. Petkov as “President of Seventh-Day Adventist

Church Reform Movement American Union, a party to this action, and am

authorized to make this verification . . . on behalf of its local churches . . .” even



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though Mr. Petkov is not identified as an officer or director of IMS-Miami.

8. As a result of IMS-Miami’s frivolous motion, I have had to expend

approximately 3 hours in sending informal letters, reviewing documents, and

preparing the draft motion and cover letter. It has taken another 1 hour1 to finalize

and file this motion, and depending on the nature of any opposition briefing thereto,

spend another 2 hours reviewing and preparing a reply thereto. Furthermore,

Plaintiff has had to engage in jurisdictional discovery of IMS-Miami, and, because

they have not properly responded thereto, file a motion to compel the same, requiring

an estimated additional 2 hours directly related to IMS-Miami’s frivolous positions

in its Motion. In addition, Plaintiff’s counsel is in the process of preparing an

Opposition brief to IMS-Miami’s frivolous motion, including assembling the

necessary information to rebut the frivolous claims made therein. This work is

anticipated to require approximately 5 hours relating directly to this Defendant, in

joint briefings opposing the Motion.

9. At my reasonable hourly rate of $275/hour, that results in no less than

$3,575.00 of reasonable attorney fees.

10. I am a 20+ year experienced trial counsel, a graduate of the University

of Nebraska College of Law and receiving the Order of the Barrister honor upon

graduating. I am licensed to practice law in all courts in California, licensed to

practice law in Nebraska (currently on inactive status), and admitted to practice

before the United States District Courts for Southern California, Central California,

Northern California, Nebraska, Eighth Circuit Court of Appeals and the Federal

Circuit Court of Appeals, in addition to many pro hac vice appearances in other

states. I spent a recent seven+ years exclusively handling complex civil litigation in

federal courts. My reasonable hourly rate for this type of litigation is $275/hour

1 This time estimate is actually lower than that in the draft Rule 11 motion in that

due to the frivolous nature of other defendants’ filings, sheer repetition has increased Plaintiff’s counsel’s speed in addressing these matters.



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which is equal or less to similarly qualified counsel in my geographic area. DATED this Wednesday, March 19, 2014.

Respectfully submitted, KRAMER LAW OFFICE, INC.





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INDEX OF ATTACHED EXHIBITS

Page Exhibit A .........................................................................1-12 Exhibit B........................................................................13-22


EXHIBIT A


Kramer Law Office, Inc. 9710 Scranton Road, Suite 160

San Diego, California 92121 Phone 855/835-5520

____________________________________________________________________________________________________________ Melody A. Kramer, Esq. [email protected]

FORMAL NOTICEPURSUANT TO FED.R.CIV.P RULE 11

VIA U.S. MAIL and EMAIL

February 24, 2014

Paul Hanna Manning & Kass Ellrod, Ramirez, Trester LLP 15th Floor at 801 Tower 801 S. Figueroa Street Los Angeles, CA 90017 [email protected]

RE: Myhre v. Seventh-Day Adventist Church Reform Movement American Union International Missionary Society, et al

Dear Counsel:

This letter is a formal notice pursuant to Fed.R.Civ.P. Rule 11(c)(2) providing you with our draft Rule 11 motion and a 21-day opportunity to correct your – Miami Dade Area Seventh-Day Adventist Church Reform Movement, International Missionary Society Inc. (“IMS-Miami”)-- Rule 11 violation before this matter need be addressed directly to the Court.

As outlined in the enclosed draft motion, numerous statements in your recently filed Motion to Dismiss on behalf of Defendant IMS-Miami are not only factual inaccurate, but frivolously so.

As of the date of this letter, you have a 21-day safe harbor in which you/your client may withdraw the Rule 11-sanctionable motion and stipulate to the obvious fact of the joint enterprise nature of your clients, and my draft motion will not be filed with the Court. Otherwise, it will be filed and we will be seeking well over $3,025 in sanctions jointly and severally against you and your client.


Mr. Hanna February 24, 2014 Page 2 of 2

Please carefully review this matter and I will watch for corrective action to be taken by you and your client.

Sincerely,

Melody A. Kramer

enclosure


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MELODY A. KRAMER, SBN 169984 KRAMER LAW OFFICE, INC. 9710 Scranton Road, Suite 160 San Diego, California 92121 Telephone (855) 835-5520 [email protected]

Attorney for Plaintiff STEINAR MYHRE



STEINAR MYHRE,

Plaintiff v.


Defendants.

))))))))))))))))))


PLAINTIFF’S MEMORANDUM OF POINTS & AUTHORITIES IN SUPPORT OF MOTION FOR SANCTIONS PURSUANT TO F.R.CIV.P. RULE 11 AGAINST DEFENDANT MIAMI DADE AREASEVENTH-DAY ADVENTIST CHURCH REFORM MOVEMENT, INTERNATIONAL MISSIONARY SOCIETY INC. (“IMS-MIAMI”)

Date: TBD Time: TBD Courtroom 5A Honorable Roger T. Benitez

)

//


DRAFT RULE 11 MOTION

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INTRODUCTION

Defendant IMS-Miami’s1 Motion to Dismiss for Lack of Subject Matter

Jurisdiction or Improper Venue; or in the Alternative, to Transfer (Doc. #34) is

violative of Fed.R.Civ.P. Rule 11’s prohibitions on frivolous arguments.

Specifically, Defendant IMS-Miami claims to be a local church, claims to be

both incorporated in, and have a principal place of business in Florida. It also claims

to be a separate and distinct entity from its co-defendants. However, it requests this

Court to transfer this case, not to Florida, but to states with which it has

acknowledged no connections - Colorado or Georgia.

This is the type of frivolous gamesmanship that Rule 11 is intended to

prohibit. Plaintiff has provided statutorily required notice in advance of the filing of

this Rule 11 motion, requesting that Defendant IMS-Miami either withdraw its

Motion or stipulate to being part of a joint enterprise with the other defendants in this

case, but they have failed or refused to do so.

Defendant IMS-Miami and its counsel should be sanctioned in the form of

reasonable attorney fees and costs relating to the filing of this motion, as well as the

costs related to additional pleadings related to this frivolity, estimated to be at least

$3,025.00.

FACTUAL SUMMARY

Defendant IMS-Miami claims that “the evidence is that . . . IMS MIAMI . . .

ha[s] observed corporate formalities” and that there “is an insufficient basis upon

which to pierce the corporate veil.” Doc. #34-1, pg. 2:7-12. No such evidence is

presented in the motion, of course, but that is the least of the pleadings problems.

IMS-Miami argues application of caselaw stating that “a corporation is

typically a citizen of two states for determining the existence of diversity

1 Defendant Miami Dade Area Seventh Day Adventist Church Reform Movement, International Missionary Society, Inc. (a Florida corporation)



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jurisdiction; the state of incorporation and the state in which it has its principal place

of business.” Doc. #34-1, pg. 4:14-16.

IMS-Miami says it is a Florida corporation with a principal place of business

in Florida (Doc. #34-1, pg. 12:14-15).

Meanwhile, in discovery responses, IMS-Miami has stated in discovery

responses that “Responding Party is a local church,” but also say its geographical

area of operations is the “United States and Puerto Rico.” Kramer Decl., ¶ 3.

However, IMS-Miami argues that this case against these supposedly separate

and distinct entities, local churches, citizen of Florida, is entitled to this case being

transferred to either Colorado or Georgia, jurisdictions with which this Defendant

does not claim to have connection of any sort!

Furthermore, despite their claimed separateness, discovery responses for IMS-

Miami were verified by Mr. Petkov as “President of Seventh-Day Adventist Church

Reform Movement American Union, a party to this action, and am authorized to

make this verification . . . on behalf of its local churches . . .” Kramer Decl. ¶ 4.

And as yet one more example of frivolity, Defendant IMS-Miami also plays

games with identification of witnesses for its “convenience” argument. Defendant

IMS-Miami claims that “the attached Declaration of Tzvetan Petkov identifies the

relevant witnesses as to the issues set forth in plaintiff’s first amended complaint.”

Doc. #34-1, pg. 17:18-19. This claim of relevant witnesses is directly contrary to

evidence in their possession, identification of additional witnesses made within the

Amended Complaint (see Doc. #15, at least ¶¶ 39, 45, 46, 52, 58, 60, 65, 66, 73-75,

77, 80, 84, 86, 95, 100, 102, 105, 106, 112, 114-117, 119, 136, 144, 152-154, 177,

186, and 194-196) and Plaintiff’s Initial Disclosures which identify 124 witnesses by

name (many with addresses also listed), and by categories of witnesses also. Few of

these witnesses are located in Georgia; many are located in California and Florida

and abroad. Kramer Decl. ¶ 5. Furthermore, their supposed witness list is focused

on a single telephone conference which is known, as per official meeting minutes of



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that conversation, to have had many more participants than the selected list given.

Compare AUNJ-000159-165 with Mr. Petkov’s first declaration (Doc. #31-2) and

second declaration (Doc. #4-2).

By letter dated February 24, 2014, Plaintiff’s counsel provided Defendant’s

counsel with formal notice per Fed.R.Civ.P. Rule 11, including a draft Rule 11

motion in substantially the same form as that now being filed. See Kramer Decl. ¶ 6.

Defendant IMS-Miami and its counsel have nonetheless failed and refused to take

corrective action.

As a result of IMS-Miami’s frivolous motion, Plaintiff’s counsel has had to

expend approximately 5 hours in sending informal letters, reviewing documents, and

preparing this draft motion and cover letter. It is anticipated that if Defendant IMS-

Miami refuses to take corrective action by withdrawing its frivolous motion, it will

require another 2-3 hours to finalize and file this motion, and depending on the

nature of any opposition briefing thereto, spend another 2-3 hours reviewing and

preparing a reply thereto. At Plaintiff’s counsel reasonable hourly rate of $275/hour,

that results in no less than $3,025.00 of reasonable attorney fees that Defendant IMS-

Miami should be required to pay to Plaintiff and his counsel as a result of this

sanctionable conduct.

ARGUMENT

Fed.R.Civ.P. Rule 11 allows a Court to sanction attorneys and/or parties for

making frivolous legal claims in pleadings. Legal claims require reasonable inquiry

and must be warranted by existing law or be non-frivolous arguments for extension

of existing law. Likewise, factual contentions must have evidentiary support.

While there is certain leeway to plead alternative legal theories, Defendant

IMS-Miami is veering off into the pleading of materially inconsistent claims of fact.

That is impermissible, frivolous, and sanctionable under Rule 11.



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I. RULE 11 ALLOWS A COURT TO SANCTION ATTORNEYS OR PARTIES FOR MAKING FRIVOLOUS LEGAL CLAIMS.

A. Legal and factual claims made to the Court must be warranted by existing law or be non-frivolous.

By presenting to the court a pleading, written motion, or other paper — whether by signing, filing, submitting, or later advocating it — an attorney or unrepresented party certifies that to the best of the person's knowledge, information, and belief, formed after an inquiry reasonable under the circumstances:

(1) it is not being presented for any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation;

(2) the claims, defenses, and other legal contentions are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law or for establishing new law;

(3) the factual contentions have evidentiary support or, if specifically so identified, will likely have evidentiary support after a reasonable opportunity for further investigation or discovery; . . .

Fed.R.Civ.P. Rule 11(b).

Defendant IMS-Miami cannot claim it is a separate and distinct entity while

simultaneously parroting the precise claims of the other defendants from whom they

claim to be separate and distinct. They cannot sit in Florida and with a straight face

say that entitles them to transfer of this case to Colorado or Georgia.

Defendant IMS-Miami cannot offer almost identical discovery responses,

“verified” by the same person (one of whom is not even an officially listed officer of

IMS-Miami), and still claim they are separate and distinct.

Such a position makes a mockery out of the legal process. If they want to

maintain the argument that they are separate and distinct, they must act like it.

Otherwise, they must agree to the obvious, that they are neither local churches nor

are they separate and distinct from the rest of the defendants in this case.

Defendant IMS-Miami, and their counsel, have proferred this logically

impossible set of claimed facts and arguments for the obvious reason of engaging in



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the improper purposes of delay and increasing costs to Plaintiff. This should be

sanctioned.

B. The Court can sanction attorneys or parties responsible for Rule 11 violations.

(1) In General.

If, after notice and a reasonable opportunity to respond, the court determines that Rule 11(b) has been violated, the court may impose an appropriate sanction on any attorney, law firm, or party that violated the rule or is responsible for the violation. Absent exceptional circumstances, a law firm must be held jointly responsible for a violation committed by its partner, associate, or employee.

(2) Motion for Sanctions.

A motion for sanctions must be made separately from any other motion and must describe the specific conduct that allegedly violates Rule 11(b). The motion must be served under Rule 5, but it must not be filed or be presented to the court if the challenged paper, claim, defense, contention, or denial is withdrawn or appropriately corrected within 21 days after service or within another time the court sets. If warranted, the court may award to the prevailing party the reasonable expenses, including attorney's fees, incurred for the motion.

. . .

(4) Nature of a Sanction.

A sanction imposed under this rule must be limited to what suffices to deter repetition of the conduct or comparable conduct by others similarly situated. The sanction may include nonmonetary directives; an order to pay a penalty into court; or, if imposed on motion and warranted for effective deterrence, an order directing payment to the movant of part or all of the reasonable attorney's fees and other expenses directly resulting from the violation.

Fed.R.Civ.P. Rule 11(c)(1), (2), and (4).

Under the standards here, Defendant IMS-Miami and their counsel have

liability under the Rule. They have made the absurd claim that they are “local



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churches” covering a geographic area of “the United States and Puerto Rico,” are

incorporated in Florida, have a principal places of business in Florida, but that they

are separate and distinct entities that are entitled to having this case transferred to

Colorado or Georgia.

Coupled with the blatant misrepresentation of the contents of the Amended

Complaint and discovery responses that fully demonstrate the joint nature of these

defendants with their co-defendants, this is a case particularly appropriate for

sanctions.

In contrast to the Rule 11 motion filed against Defendant IMS-GC, counsel’s

involvement of sanctionable conduct is right on par with his clients. Such internal

inconsistencies cannot have escaped the notice of counsel when he was signing the

pleadings at issue. Even if counsel was provided with some misrepresentations from

his clients, he should have refused to sign and present to the Court such a frivolous

pleading as this. Thus, both Defendant IMS-Miami should be sanctioned jointly and

severally with their counsel.

CONCLUSION

For the reasons set forth above, Defendant respectfully requests the Court to

issue Rule 11 sanctions against Defendant IMS-Miami, in the form of attorney fees

and expenses necessitated in bringing this motion and relating extra efforts to

counter the frivolous pleading, or in other manner as deemed appropriate to the

Court.

DATED this Monday, February 24, 2014.

Respectfully submitted,

KRAMER LAW OFFICE, INC.




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melody a. kramer, sbn 169984 kramer law office, inc. … · 2014-04-14 · my business address is...

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