A federal judge has sanctioned Littler Mendelson and referred one of its shareholders to a court ethics commission for his conduct in defending an employee-overtime lawsuit against 24 Hour Fitness.

Judge John Kane of the U.S. District Court of Colorado on August 14 fined Littler Mendelson $3,150 for making “unwarranted” and “unsubstantiated” arguments related to a 2006 nationwide lawsuit brought by current and former employees against the gym chain.

The judge referred firm shareholder Joshua Kirkpatrick to the court’s Committee on Conduct, finding that his behavior was “egregious” in arguing a point about whether the employees had been properly served with court papers. The attorney’s conduct, the judge wrote, “unnecessarily diverted the limited resources of this court.”

Kirkpatrick and a spokeswoman for Littler Mendelson both declined to comment.

The decision stemmed from more than 300 countersuits that the gym chain filed against the employees regarding whether the overtime disputes belonged in arbitration or in court. The chain had obtained summonses to bring those actions, but, Kane wrote, had failed to actually serve those actions on nine of the parties.

In arguing against dismissal of those nine actions, Littler Mendelson asserted that it had properly served them under the Federal Rules of Civil Procedure. In addition, the firm argued that 24-Hour Fitness was entitled to default judgment in those cases.

On June 7, however, Kane ruled that the procedural rule argued by the law firm applied to papers served on the parties’ attorneys, not the parties themselves. In the same order, Kane demanded that Littler Mendelson explain why he should not sanction the firm for making such an argument, and why he should not refer Kirkpatrick to the conduct commission.

In response, Littler Mendelson asserted that the arbitration issue created an exception to the usual summons and process of service rules, according to Kane’s August 14 order.

Kane was not convinced. “Instead of simply acknowledging this failure and seeking an extension of time to serve the above-captioned defendants, 24 Hour Fitness first sought to advance and capitalize upon an argument unwarranted by existing law and unsupported by a non-frivolous argument for extending, modifying, or reversing existing law or establishing new law,” the judge wrote.

Kane added that although the reason for law firm’s conduct was “unclear,” he assumed that it was to avoid having to pay the $350 fee it would have cost to refile each of the actions had he dismissed them without prejudiced.

Contact Leigh Jones at ljones@alm.com.