Here’s a cautionary tale for lawyers: Don’t tell a federal judge that a fact is “undisputed” when it is in dispute. And, don’t double-down on calling it undisputed when the Judge holds a hearing to ask you about it. See McClinton v. Capstone Logistics, LLC, No. 2:20-cv-543-AMM, 2023 WL 3274937 (N.D. Ala. May 4, 2023).
Richard McClinton sued Capstone Logistics claiming that he was discriminatorily fired in violation of federal law. Capstone claimed there was no discrimination and that McLinton was fired falsifying a Corrective Action Form. McLinton testified at deposition that he did not falsify the form. McLinton’s former supervisor said that McLinton did falsify the form. This is the quintessential dispute of material fact which is submitted to a jury for resolution.
Nevertheless, Capstone’s lawyers filed a summary judgment brief asking for dismissal of the case and repeatedly claiming it was undisputed that McLinton falsified the form. McLinton responded and demonstrated that this crucial fact was in dispute. “On reply, Capstone’s counsel did not withdraw but rather persisted in their misrepresentation that it was undisputed that Mr. McLinton doctored the Corrective Action Notice.” McLinton, 2023 WL 3274937 at *3.
United States District Court Judge Anna M. Manasco denied Capstone’s motion for summary judgment and scheduled a hearing for its lawyers to explain “why this misrepresentation does not violate their duty of candor to the court and Federal Rule of Civil Procedure 11(b)(3).” McLinton, 2023 WL 3274937 at *3.
Most lawyers would come to the hearing hat-in-hand and beg for forgiveness. Capstone’s lawyer took a different approach. He claimed that the summary judgment argument was merely “unclear.” Judge Manasco told the attorney that his argument was “nonresponsive to the Court’s concern about misrepresentation.” McLinton, 2023 WL 3274937 at *4. Nevertheless, counsel persisted in calling his summary judgment brief “unclear.” Id. Moreover, he persisted with his argument “[e]ven after the court explained that Capstone’s pleading had not been merely ‘unclear,’ but had been ‘the opposite of … true.” Id.
At the conclusion of the hearing, Judge Manasco ordered counsel to “brief the issue of appropriate sanctions.” McLinton, 2023 WL 3274937 at *5. At this point, most lawyers would roll over and play dead. But, Capstone’s lawyers decided to challenge the judge. They claimed: (1) she was acting “in contravention of Rule 11”; (2) their filings “accurately stated the undisputed facts”; and, (3) sanctions weren’t appropriate because Judge Manasco wasn’t actually misled by any representation. Id. To make matters worse, they said that Judge Manasco had applied an “overly literal” and “hasty” reading of their summary judgment brief. Id.
Unsurprisingly, Judge Manasco was not convinced to withhold sanctions. Instead she found:
Based on Capstone’s post-hearing brief, the court finds that Capstone’s counsel did not inadvertently, overzealously, or even recklessly stumble into a regrettable mistake—after they deliberately misrepresented a fact, they later repeated that misrepresentation, and still later were not discouraged or deterred by the court’s inquiry, nor by the clearly stated risk of sanction.
McLinton, 2023 WL 3274937 at *5.
Judge Mansaco issued the sanction of admonishment with circulation. “The admonishment is to not make material misrepresentations to a tribunal.” McLinton, 2023 WL 3274937 at *8. She also ordered that the admonishment must be circulated to every attorney in Capstone’s law firm, which is composed of more than 500 lawyers in 36 offices across the United States.
It’s easy for me to Monday Morning Quarterback this case. I don’t know all of the facts or the strategies that went into Capstone’s arguments. But, based on Judge Manasco’s version of events, I probably would have adopted a different strategy.
It should also be noted that Judge Manasco was also unhappy with Mr. McClinton’s lawyer. In a separate opinion she sanctioned him with a public reprimand for willfully failing to comply with her orders regarding length, formatting and filing of briefs. McLinton v. Capstone Logistics, LLC, No. 2:20-cv-543-AMM, 2023 WL 3274937 (N.D. Ala. May 4, 2023).