Friday, October 21, 2011

Lack of Factual Basis for Counsel's Representations to the Court Warrants Sanctions Under 28 U.S.C. § 1927

Plaintiffs' motion for sanctions under 28 U.S.C. § 1927 was granted based on statements made by defendant's president and counsel during a TRO hearing. "Counsel for [defendant] represented to the Court that nothing meaningful would occur prior to the time the Court could hold a hearing on the request for a preliminary injunction. . . . [T]he Court is convinced that counsel did not make any knowing misrepresentations to the Court. Such conduct would stand in stark contrast to the manner in which counsel has conducted themselves in this litigation. The lack of intentional misstatements, however, does not remedy the fact that counsel made statements with no factual basis. . . . [I]t is no defense that even [defendant's] own representatives did not know the impact of the shipments that were going to occur in the very near future. It is precisely this lack of knowledge that should have compelled counsel to make no statements about the need or lack thereof for an immediate hearing."

Velocys, Inc. v. Catacel Corp., 5-10-cv-00747 (OHND October 18, 2011, Order) (Adams, J.)

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