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Finding that two out-of-state lawyers sanctioned by a federal judge were never given a chance to defend themselves, the 2nd U.S. Circuit Court of Appeals has overruled a $10,000 assessment. Senior U.S. District Judge Constance Baker Motley of the Southern District of New York failed to follow the procedures required for imposing sanctions under Rule 11 of the Federal Rules of Criminal Procedure, the court determined, and it also restored the pro hac vice status of Florida lawyers Kent Spriggs and John Davis in Martens v. Smith Barney Inc., 00-7688. And the court, in a related ruling, remanded the case to Motley for clarification on her denial of what was termed a “motion to enforce” the settlement in a sexual harassment class action against the brokerage house Smith Barney Inc. Davis and Spriggs, of Tallahassee, Fla., had entered the case at the request of two plaintiffs who claimed that lead plaintiffs’ counsel Stowell & Friedman and Smith Barney had breached the settlement agreement approved by the court effective Feb. 1, 1999. Stowell & Friedman, the 2nd Circuit said, had contended that “Spriggs had been cited for professional misconduct by other courts and was therefore unqualified to take over as class counsel.” In his reply, Spriggs said he had no desire to take over as class counsel, and gave only a limited response to what he termed was a “personal attack” by Chicago’s Stowell & Friedman. On Jan. 31, 2000, Judge Motley denied the motion to enforce, saying it was unsupported by the papers, but gave Spriggs and Davis leave to refile their motion. She also said, “The Court has found no record from which it can conclude that Mr. Spriggs was currently admitted to practice in the Southern District of New York,” and called to his “attention” Rule 11 of the Federal Rules. While Motley made no mention of a pro hac vice motion made by Spriggs that had been pending for three months, she granted his second motion for admission pro hac vice in February 2000. When Spriggs filed his second motion to enforce, he restated his allegations that Stowell & Friedman was failing to make adequate progress on the implementation of the settlement agreement. Stowell & Friedman disputed those allegations and argued for sanctions under Rule 11 based on its claim that Spriggs and Davis had filed a baseless motion without evidentiary support. SURPRISE AT HEARING The conflict flared again on May 15, 2000, when Judge Motley held a hearing, ostensibly for the purpose of reconsidering the renewed motion to enforce. But instead of discussing the motion, Motley asked Stowell & Friedman about their allegations concerned Spriggs’ professional history. A surprised Spriggs asked for time to brief the issue, but was rejected by the judge, who said the lawyer had failed to respond to the Rule 11 issue. “We can’t permit lawyers with histories like yours to appear in the Southern District,” Judge Motley said. “You may be allowed to appear somewhere else, but you’re not allowed to appear here.” And the judge rejected Davis’ claim that the lawyers received no notice that their admission status and sanctions were to be the issues of the day. Assessing them $5,000 each, the judge told the lawyers that her initial mention of Rule 11 back in January gave them adequate notice. She also revoked their pro hac vice status. NOTICE REQUIRED On the appeal, 2nd Circuit Judge Sonia Sotomayor said that the circuit’s case law “strongly implied” that due process “requires notice and an opportunity to be heard before revocation of pro hac vice status.” “The notice and opportunity to respond provided Spriggs was so flawed as to constitute an abuse of discretion,” Sotomayor said. “It is undisputed that Spriggs was not given notice by the court that it could revoke his pro hac vice status on the basis of his past conduct until the hearing during which the court did so.” Moreover, Judge Sotomayor said, Spriggs was never afforded “a realistic opportunity to respond to the charges of past misconduct.” Spriggs had responded to the allegations in his papers, she said, and the district court had gone ahead and granted his second motion for admission. And Judge Motley had made no mention of the sanctions issue, or the allegations, when she directed Spriggs to file reply papers to Stowell & Friedman’s opposing memorandum on the motion to enforce. The 2nd Circuit also gave little credence to Motley’s statement that Spriggs had been given an opportunity to respond to the charges at the outset of the May hearing. “The district court fails to mention, however, that it had repeatedly indicated that the subject of the second hearing was to be the motion to enforce,” Judge Sotomayor said. “Presented with this surprise ‘opportunity’ to address the charges, Spriggs can hardly be faulted for requesting permission to submit a supplemental brief on the issue. Yet the district court summarily denied this request.” As for Davis, Sotomayor said, he “received even less notice than did Spriggs.” SEPARATE MOTION Moreover, she said, a motion for Rule 11 sanctions must be made separately from other motions or requests, which did not happen in this case, and even if Judge Motley had instituted the sanctions process sua sponte, she was still required to issue an order to the attorneys to show cause why they had not violated Rule 11. Because Motley, “denied the motion to enforce the settlement agreement without a hearing or an explanation,” Sotomayor said the 2nd Circuit was remanding the case for “clarification or further proceedings.” Judge Guido Calabresi joined in the opinion. Linda Friedman and Max Fischer of Stowell & Friedman represented the class in the case. Brad S. Karp, Joyce S. Huang and Daniel J. Toal of Paul, Weiss, Rifkind, Wharton & Garrison represented Smith Barney.

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