Ninth Circuit En Banc Dissent as to Sanctions on Lawyers in Kari Lake's Election-Related Litigation

From Judge Lawrence VanDyke’s dissent from denial of rehearing en banc in Lake v. Gates, joined by Judges Consuelo Callahan, Ryan Nelson, Daniel Collins, Kenneth Lee, and Patrick Bumatay:

The panel decision in this case upheld a sanctions order under Rule 11 of the Federal Rules of Civil Procedure and 28 U.S.C. § 1927 against attorneys Andrew Parker and Kurt Olsen. Parker and Olsen (collectively, “Lead Attorneys”) represented plaintiffs Kari Lake and Mark Finchem in election-related litigation.

As the district court candidly acknowledged, the sanctions were intended to “send a message” to similar litigants in election-based lawsuits and to discourage litigation disfavored by the court. Zealous to safeguard the “public trust,” the district court read plaintiffs’ complaint out of context and in the light least favorable to plaintiffs; imposed a heightened requirement that Lead Attorneys conduct “significant” pre-filing inquiries on the basis of their clients and their cause; levied sanctions on the ground that plaintiffs made claims that, as even the district court itself recognized, the complaint never actually stated; and badly misapplied the governing legal standards.

This case involved legal claims that might charitably be characterized as aggressive. It was a Hail Mary legal theory, especially as to standing. But we encounter Hail Mary legal theories regularly in our court in a variety of contexts, and while they almost always lose, they don’t get sanctioned just because they are longshots. Many cases are dismissed because the asserted injuries are too speculative to support Article III standing. A great many more are dismissed for failure to state a claim on which relief can be granted.

The law has no lack of tools short of sanctions to deal with speculative claims, adventurous legal theories, and imprecisely drafted complaints. Again, our circuit entertains cases with exceedingly improbable claims on a routine basis, which are usually (but not inevitably, which is probably why hope springs eternal) dispatched using any of the panoply of available mechanisms. If the run-of-the-mill Hail-Mary claims we routinely encounter are not sanctionable, neither were the claims in this case.

Two reasons independently made this case worthy of en banc review. First, the district court and the panel badly misapplied the standards for finding attorney conduct sanctionable. The district court flatly misread the allegations in plaintiffs’ complaint. While the complaint never actually said that Arizona did not use paper ballots—a fact that the district court even acknowledged in its sanctions order—the district court nevertheless found such a claim implied in the complaint (and thus sanctionable). But the context of the complaint confirms what its plain language makes clear: The attorneys never argued that Arizona did not use paper ballots.

Although the complaint may not have been drafted with perfect precision, the district court reached the alternative conclusion only by repeatedly going out of its way to construe the complaint in the light least favorable to plaintiffs. Read in context, the complaint cannot be plausibly construed as asserting what it never said. Penumbras, emanations, and acontextual implications should be insufficient to warrant sanctions under Rule 11, and the district court abused its discretion in concluding otherwise. The panel majority ratified those errors, and in doing so reinforced the district court’s departure from the Rule 11 standard and our case law interpreting that Rule.

Second, the district court boldly proclaimed that it levied sanctions on Lead Attorneys with the hope that doing so would “send a message” to deter future litigants with similar claims—or, put bluntly, to deter a specific type of election litigation. Setting aside the myriad legal problems posed by this action—not the least of which is making a hash of the Rule 11 standard—that just looks bad. And even if the inference is unwarranted, this court’s refusal to grant en banc review will be construed by many as implicitly blessing the district court’s weaponization of sanctions to chill politically disfavored litigation.

Who could blame them? Cudgeling attorneys into abandoning unpopular claims and clients is not what sanctions are for. While not authoritative here, the Arizona Supreme Court astutely observed that “[b]y sanctioning parties and their lawyers for bringing debatable, long-shot complaints, courts risk chilling legal advocacy and citizens raising ‘questions’ under the guise of defending the rule of law.” “Even if done inadvertently and with the best of intentions, such sanctions present a real and present danger to the rule of law.” And that “danger to the rule of law” is all the more present when the judge issuing the sanctions boldly proclaimed that such a chilling effect is an intended feature, not a bug.

We should have taken this case en banc to rectify these abuses and make clear that Article III judges are to adjudicate cases without fear or favor, remaining scrupulously neutral toward all litigants—especially in politically charged cases where the public is watching. I respectfully dissent from our failure to do so.…

You can see also the panel decision, which includes a dissent from Judge Bumatay.

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