Cunningham v. Hamilton County OH - Oral Argument

Argument of Thomas C. Goldstein

Chief Justice Rehnquist: We'll hear argument first this morning in Number 98-727, Teresa Cunningham v. Hamilton County, Ohio.

Mr. Goldstein.

Mr. Goldstein: Mr. Chief Justice, and may it please the Court:

The district court in this case sanctioned petitioner, who is not a party to the underlying litigation, but instead was the plaintiff's counsel.

The question presented to this Court is at what time petitioner should appeal the sanction.

The Sixth Circuit recognized that there were three possible answers to that question.

The first, and this is the rule the that the Sixth Circuit adopted, is that petitioner should wait until the final judgment in the case.

That rule, however, has some serious problems.

First and foremost, it conflicts with this Court's repeated holding for more than 100 years that only parties may appeal the final judgment.

Chief Justice Rehnquist: But there are exceptions to that rule, are there not, Mr. Goldstein?

Mr. Goldstein: Mr. Chief Justice, there is an indication in this Court's precedents that there are a class of persons known as quasi-parties who may appeal, but the quasi-party cases do not determine whether or not that appeal should be brought at the end of the case or not.

This Court's most recent precedents, particularly Marino v. Ortiz and Karcher v. May, instruct that the test is whether or not the individual who seeks to appeal could intervene in the case under Rule 24(b), and there is no question that petitioner could not intervene under Rule 24(b).

Justice Ginsburg: Mr. Goldstein, you have recognized that, if the client had been sanctioned as well, the client would have to wait till the end of the line and presumably the lawyer, too, and the lawyer, although not a party, could then appeal, so that seems to be inconsistent with your position.

Mr. Goldstein: The circuits that have confronted this question uniformly agree, and so do we, that when that sanction merges into the final judgment, practicalities require that the sanction itself come up together, because it would be injudicious...

Justice Ginsburg: But we have a nonparty, the attorney, who could take an appeal then, so the Chief asked if that rule is without exception.

One exception would be this very situation if the client were sanctioned along with the lawyer.

Mr. Goldstein: That is correct, but we do believe that that position is consistent with our views of Rules 3 and 4 of the Federal Rules of Appellate Procedure.

That sanction merges into the final judgment because it is... it operates upon the client.

Justice Ginsburg: If you're wrong about the possibility of the attorney appealing the sanction at the end of the line, if you're wrong about that, then I take it you concede that you could not prevail here.

Mr. Goldstein: Respectfully, no.

There are very serious practical consequences that make this sanction effectively unreviewable at the end of the case under the third prong of the Cohen doctrine.

In particular, we...

Justice Scalia: Before we get to those, I'm sort of perplexed by the inconsistency at the other end.

Why is it that an attorney would not be a party for purposes of appealing immediately...

Mr. Goldstein: The...

Justice Scalia: but... I mean, would be a party, treated like a party for purposes of appealing immediately, but would not be a party for purposes of appealing at the end of the case?

I mean, I don't see why, conceptually, that makes any sense.

Mr. Goldstein: It requires this Court to track Rule 3 of the Federal Rules of Appellate Procedure, and that rule instructs that you may appeal from an order or a judgment to which you are a party.

No one contests that the petitioner is a party to the sanction order.

It is directed at her.

She is not, however, a party to the final judgment, with which she has nothing to do.

Chief Justice Rehnquist: Well, so you're saying she could appeal the... on the basis of the order, in... but she couldn't appeal from the final judgment.

That seems a very strange result.

Mr. Goldstein: Mr. Chief Justice, this Court has been quite clear that the final judgment itself has to be looked at in isolation, and you determine whether or not the appellant is a party to the final judgment.

Justice Scalia: But she's not appealing the final judgment.

The final judgment is simply what we refer to to determine when she may appeal.

She's still appealing the order, whether she appeals it immediately or later.

Mr. Goldstein: That is correct, the difference being that under Rule 4 of the Federal Rules of Appellate Procedure she is precluded from appealing the sanction order more than 30 days after it's entered.

She is directed... the rule directs that you appeal upon the entry of the order or the judgment.

Rule 4 further instructs that the entry is to be determined under the entry definition in the Rules of Civil Procedure, and that is when it is placed upon the docket by the clerk of the district court.

The sanction order here was entered upon the docket.

It was the only thing that she could appeal from as a practical matter under the Federal Rules of Appellate Procedure.

She had no other choice.

Justice Ginsburg: Mr. Goldstein, there are all kinds of orders that are made in the course of a trial proceeding, orders that are not immediately reviewable, and you don't lose out because of the 30-day limit.

I think that that applies to a final order, not to an interlocutory order.

Mr. Goldstein: That is correct.

This Court has instructed that mere discovery rulings, or anything else, really, that goes to a party to the litigation, one of the actual litigants, all of those merge into the final judgment.

But the Court has been equally clear that when it is a third party, when it is not a litigant who is in question, and we point the Court particularly to Alexander and its progeny, which are discussed at length in the blue brief, and those cases instruct that when you are dealing with a third party who has been punished by the district court, that order does not merge into the final judgment.

The only time that it may be appealed is directly upon its imposition.

The Court has drawn a very clear line between the actual litigants before the district court and third parties who might be punished by...

Justice Ginsburg: Well, if the Court should decide that no such line was ever drawn and that it would make no sense to draw it, that is, the judgment is the occasion, as Justice Scalia said, it answers the when question.

Justice Breyer: You can appeal it then.

Justice Ginsburg: The attorney isn't seeking to reverse the judgment against the client, but is seeking to review an order that was made along the way.

So you were beginning to tell us that even if it's right that this would be appealable at the end of the line, still, you said, it could be appealed earlier because...

Mr. Goldstein: Exactly.

If I could return to your earlier question, the sanction is effectively unreviewable, notwithstanding a holding by this Court that petitioner technically could file a notice of appeal from the final judgment.

There are two classes of reasons.

The first is, it is not at all clear that there will be a final judgment.

The district court, for whatever reason, might never close the case, the case could settle, the case could simply languish, and the attorney would never have a triggering right, under the Federal Rules of Appellate Procedure ever to bring such an appeal.

In addition, along with those practical considerations, the attorney really is injured in the interim.

We do not believe that this is an independent ground for appeal, but when you look at all the practical considerations for an attorney, the attorney is forced to pay the money...

Chief Justice Rehnquist: Well, in this case it was stayed.

The order was stayed, was it not?

Mr. Goldstein: Respectfully, no.

There is a subtle but very important difference for purposes of Rule 4.

The order itself was not stayed.

Petitioner requested twice that it be stayed.

After she filed the notice of appeal, the collection of the sanction was stayed, and our point remains that under Federal Rule of Appellate Procedure 4, she is required to appeal not from the collection of the sanction but from the entry of the order.

To give another example...

Chief Justice Rehnquist: Does that mean that the order could not be stayed, in your view?

Mr. Goldstein: No.

We respectfully believe that that is a good course for district courts to take.

Chief Justice Rehnquist: Well then, that takes some of the injury out of it.

Mr. Goldstein: If a district court were to do so, if the district court were to announce to an attorney, I believe you have contravened my ruling, I believe you have engaged in irresponsible conduct and at the end of this case I am going to sanction you $1,500, $10,000, what-have-you, that order would not be immediately appealable.

That is the balance...

Justice Scalia: Well, that isn't staying the order, that's not entering the order until later.

It seems to me you can never stay an order.

You stay the consequences of the order.

You stay the effect that the order provides, so you're not talking about staying the order.

It seems to me this order was stayed as completely as any order is ever stayed.

Its effect was suspended until the end of the trial.

Mr. Goldstein: I take that distinction.

That is fair.

If the district court were to not finally enter the order until the conclusion of the case, or were to expressly provide that the sanction will merge into the final judgment, respondent's point would be well-taken, and these sanctions would be appealed at the end of the case.

We are attempting to create a situation in which the district court has a balance.

If the district court believes that the situation is so serious that the sanction has to be finally entered right now, and that direction to pay has to be entered right now, then the attorney is finally told and the sanction is determined completely as to her.

And when we have that third-party situation, where the district court is not going to return to the sanction, when the issue is decided, it is final as to the attorney and she could and should bring the appeal immediately.

Justice Breyer: Is there any reason... I mean, assuming that the language is open to your interpretation or the other, which I'll assume for the moment, is there any good reason why we should make this so complicated?

I mean, shouldn't... isn't the simple... courts of appeals have a lot to do, and if we take the other position, we're sure they're not going to get into this business of trying to mix the, is it part of the merits, isn't it part of the merits, et cetera.

It's a single rule for everybody, and is any harm done?

Mr. Goldstein: There is no harm in a clear, single rule, and that's...

Justice Breyer: Or the clear, single would be, you'd lose, because the clear, single rule would be, everybody... if you're sanctioned, the time to appeal the sanction order, just like an attorney who is still in the case, the attorney who isn't appeals it at the end of the case, and if you don't like the order in the meantime, ask for a stay, and if he won't give you a stay, go under Rule 8, get the court of appeals to do it.

Mr. Goldstein: Respectfully, that's... two... we should make two points.

We do think that our rule is perfectly clear.

If you are an attorney and you are sanctioned alone, file your notice of appeal.

We don't believe that that gives rise to any sort of...

Justice Breyer: Oh, well, why wouldn't it give rise to the problem of, in many sanctions cases, when they get to the court of appeals it would be mixed up with the merits, and all of a sudden you discover that this attorney was sanctioned for bringing a frivolous this or that, and the court of appeals, the parties will think, my God, we'd better be up there arguing about this, because it has to do with the merits of the case.

Mr. Goldstein: Respectfully, no.

But if I could first deal with the Rule 8 problem, and that is that Rule 8 is triggered once you file a timely notice of appeal.

If this Court's holding is that the notice of appeal in the first instance is not proper and not timely, none of the Federal Rules of Appellate Procedure apply, including the ability to get a stay, including the ability to get a supersedeas bond...

Justice Kennedy: Well, I suppose on that point, in a serious case, could you get a writ of mandate?

Mr. Goldstein: The Court has been very clear that writs of mandamus...

Justice Kennedy: I mean, it's a million-dollar fine, and the judge refuses to stay it.

Could you go to the court of... let's assume that you had to wait till the end of the... could you get a writ of mandate?

Mr. Goldstein: Respectfully, we do not believe so.

The Court has been very clear that the writs under the All Writs Act, including writs of mandate, prohibition, and the like, are confined to keeping the district court within the lawful exercise of its jurisdiction, and it's very difficult to conceive, no matter how much the financial burden is upon the lawyer, that you can make the argument that it's outside...

Justice Breyer: I'm sorry, why can't... I would think this would be an odd case that it would ever happen that if a lawyer is sanctioned in the middle of the case, and the lawyer withdraws, so that he's not still representing the party, and you say, judge, I want to appeal, I can't appeal to the end, would you mind staying the payment until the end of the case, and the judge would say no.

I can't believe a judge would do that, but if the judge did say no, you would go to the court of appeals and ask them for a stay.

Is there any problem with that?

Mr. Goldstein: The Federal Rules of Appellate Procedure and its stay provisions, including Rule 8, are not triggered at that point because there is no timely notice of appeal.

Justice Breyer: Where does it say that Rule 8, to get a stay, you have to have filed a notice of appeal?

Chief Justice Rehnquist: I didn't see...

You don't have jurisdiction... the court of appeals doesn't have jurisdiction if...

Justice Breyer: To protect itself.

That's my question, because that's what I wondered.

Mr. Goldstein: We do read the rules to not permit it, and in fact we have studied every single interlocutory attorney sanction appeal that has been brought in the last 20 years, and a court of appeal has never, ever allowed a writ of mandamus or Rule 54(b) certification, a 1292 certification.

The courts of appeal expect you to file a timely notice of appeal, and those circuits that are on the bottom of the split and do not believe that an interlocutory appeal is permitted simply will have nothing to do with it.

Justice Ginsburg: Mr. Goldstein, when Justice Breyer asked you, you could read it one way, you could read it the other way, why shouldn't the tie-breaker be 1292(e)?

The Congress said, courts, this is the kind of thing you ought to sort out by rule-making.

You want to make more things final, court, you can do that through the rule-making process.

Given that signal from Congress, why should we do anything by adjudication to add to the list of interlocutory orders that are immediately appealable?

Mr. Goldstein: Justice Ginsburg, the Court has... and you have pointed this out in an earlier opinion for the Court that that option is open to this Court to begin the rule-making process, which respectfully, it has never seen fit to do, and there are no less than a dozen splits in the circuits about when various interlocutory orders may be brought to this Court.

We have no objection if the Court were to, in addition, use its rule-making authority to resolve these conflicts, but the Court does have before it this case.

Justice Scalia: What is the... I mean, you're being very picky about, you know, Rule 4, Rule 8 and so forth.

What is the textual authority for any interlocutory appeal?

Mr. Goldstein: The textual authority does lie squarely within 28 U.S.C. 1291.

This is literally and figuratively a final decision.

It is complete as to petitioner.

The district court is not going to ever revisit the sanction.

Justice Scalia: It's a judicial elaboration in Cohen upon the term, final order.

Mr. Goldstein: There is no term, final order for...

Justice Scalia: Final decision, excuse me.

Mr. Goldstein: Yes.

That's exactly right, and the Court has made clear that it is a practical construction of the term, final decision, and in...

Justice Scalia: Well, if it's just a matter of practicality, I mean, we're making it up under Cohen, essentially.

We say, some things are final decisions, and other things aren't final decisions, and we feel free to use the Cohen factors, some of which have very little to do with finality.

They have to do with practicality.

So why not take those same practical considerations into account in the present instance?

Mr. Goldstein: We believe that the practical considerations do favor petitioner in this case.

In particular, there is the grave concern that she could not appeal from the final judgment, but that cannot be the right result.

Justice Ginsburg: Why didn't she try?

One of the striking things about the facts of this case is that no protective appeal was taken once there was a final judgment.

That was just allowed to happen.

Mr. Goldstein: That's correct.

Petitioner believed that it was inappropriate for her to bring an appeal from the final judgment in the case.

It is worth noting that at the time she filed her notice of appeal, every single circuit that had confronted these facts had ruled in her favor.

Justice Ginsburg: Well, what did she have to lose, because it seems that would put her in the best position?

Mr. Goldstein: That is not correct, respectfully.

Under Rule 38... there were sanctions motions filed upon the filing of this notice of appeal.

Under Rule 38, if she files an improper notice of appeal she can get herself in more trouble, but I do want to pick up...

Chief Justice Rehnquist: Where?

Justice Ginsburg: What kind of trouble?

Mr. Goldstein: For filing an improper notice of appeal from the final...

Justice Ginsburg: You are envisioning that the court of appeals, when someone is in this bind, says the law is uncertain, so I filed a notice of appeal at the interlocutory stage, I filed one at the end of the line, a court of appeals would sanction a lawyer for doing that?

Mr. Goldstein: At the... it is a concern that the attorney, even if she is not going to be sanctioned, should still appeal when it's appropriate and should not be filing unnecessary protective appeals, but it is worth returning to our argument under Rule 4(a)(2), and that is that the Federal Rules of Appellate Procedure explicitly contemplate that if you file too early your notice of appeal automatically functions to be protective.

Justice Kennedy: May I ask in... picking up on your last colloquy with Justice Scalia, do you acknowledge that this is a Cohen problem at all?

Cohen orders usually refer to parties.

Mr. Goldstein: That's absolutely correct.

We have fitted within the Cohen doctrine because most of the courts of appeal have, but the closest analogue, truthfully, are the cases in which this Court has dealt with third parties who are punished, and they deal with them completely outside of the Cohen doctrine, because it's final as to that person, cases like Alexander and the like.

Justice Stevens: May I ask, when you talk about the closest analogue, is there anything we can learn from the procedure when a lawyer is actually held in contempt, as opposed to just sanctions?

When do you appeal then, and so forth?

Mr. Goldstein: Respectfully, yes.

We believe that, for example, under Rule 16(h) of the Rules of Civil Procedure, petitioner could have been held in civil contempt, and there is no question that... respectfully, we believe there's no question that she could have appealed at that time, because the Court is very clear that nonparty civil contempts are immediately appealable.

There is no practical difference in terms of the effect on district courts, or on the effect on courts of appeals.

Why, if the district court says, this is not merely a Rule 37 sanction, I'm going to put next to it the word contempt, why one should be appealable and one should not.

In addition...

Justice Stevens: And is it true that the contempt cases we've reviewed have been reviewed on the interlocutory stage, rather than after the final judgment?

Mr. Goldstein: Yes.

In fact, that's the express direction.

The most recent case is United States Catholic Conference in 1988, and that was absolutely interlocutory, and the precedents in the blue brief explain that a... appeal from the final judgment in fact would not be permitted.

They have...

Chief Justice Rehnquist: But isn't an attorney given considerably more procedural rights in the case of a citation for contempt than for a sanction?

Mr. Goldstein: Rule 37 requires that there be a notice and opportunity to be heard, but civil contempt cases do not draw a greater distinction, and in particular, again, Rule 16(h) allows the district court to simply deem this to be a contempt, and so does Rule 37(b), which also deals with discovery sanctions.

If petitioner had continued to refuse to turn over the documents, for example, she could have been money-sanctioned, or the district court could have deemed it to be a civil contempt.

In terms of... there just would be no practical difference on the effect on the district court or a court of appeal that a... that the district court labels it contempt.

But if we could... if I could mention one other practical difference, and that is, it seems a bad practical and policy judgment to tell the attorney, well, if you go that one step further and get yourself held in civil contempt, then you can appeal, because that has grave collateral consequences on the attorney's client.

Justice Scalia: Well, that would be a pretty risky thing for an attorney.

Justice Kennedy: I'm not really worried about an attorney...

Chief Justice Rehnquist: Yes, that's hardly a motivation, to say that, you know, yes, you're in bad shape now...

Right.

Right.

but if you just get yourself held in contempt, you'll be okay.

Unidentified Justice: [Laughter]

Justice Scalia: I mean, I suppose he might commit suicide, too, but I'm not really worried about it.

Mr. Goldstein: Respondent has suggested that this rule that we propose would lead to lots of attempts to appeal, that attorneys might get themselves sanctioned in order to have the right to take an appeal, and we hope the Court will take the same practical view of that as well.

Justice Scalia: Mr. Goldstein, can I ask you, if you say that Cohen is really not implicated here, then there really is no way to handle the case where you have an interlocutory appeal and it is intimately bound up with the merits of the case, that really whether there was a sanctionable conduct or not depends entirely upon how you view the merits of the case, which seems to me not at all an unusual situation.

What do you do in that case?

Mr. Goldstein: Well, Justice Breyer...

Justice Scalia: Since we're not applying Cohen you can't say, well, although most of these things would be interlocutory, this one won't be.

We'll have... you'll have to do this at the end of the whole proceeding.

Mr. Goldstein: This is briefed at length in the case.

We respectfully do not believe that appeals of Rule 37 sanctions and Rule 11 sanctions do bring up the case, because what is being appealed is not the underlying determination by the district court, but instead whether or not the attorney misbehaved, and that is the line that this Court drew in...

Justice Breyer: Yes, but the ones I've actually seen, where we had appeals, they... the argument would be that the attorney, for example, asked too many questions or something in a deposition, way out of line, and the defense would be something like, well, if you really understood this case you'd understand that these questions aren't out of line.

If you really understood this case, you'd see that my delay was reasonable.

And then they'd start arguing about, what's this case really about, and at that point, if I were a client, I'd say... I'd want to be in there, you know, before the court of appeals takes a view of this.

I mean, that's the kind of thing I'm concerned about, and I guess that's the kind of thing that's led the lower courts not to allow appeals in cases where the attorney's in there and hasn't been dismissed, and a lot of other instances.

That's what's worrying me.

Mr. Goldstein: There are two answers.

The first deals with the legal standard, and the second with what actually is brought up on appeal.

The Cohen doctrine cases from this Court are very clear that the concern is that you are not bringing up on an interlocutory appeal the merits of one of the claims.

We do not want a situation where you're going to appeal now and the client's going to come along 6 months later and bring the same appeal.

And when you have the question on appeal, to turn to the practical effect of what's brought up for the appeal, if you take a Rule 37 sanctions, the question is, did the attorney behave unreasonably in believing that a particular question or deposition or interrogatory would lead to the discoverability of admissible evidence, and we proceed further and further away from the actual merits of the legal claims.

And in point of fact, this Court let this split in the circuits percolate for two decades, and the majority rule in the circuits by far, based on the experiences of courts of appeal judges like you formerly were, Mr. Justice Breyer, is that this does not intertwine with the merits and disrupt district court proceedings.

In particular, the court looks at... the courts have noted two points.

It doesn't result in a stay of the district court proceedings because the district court case, just like it did here, continues apace until it gets to final judgment.

And, pointedly, unlike a lot of this Courts interlocutory appeal cases, it's not going to moot out.

Justice Kennedy: Are there instances, in your experience, where there are repeated multiple sanctions put on an attorney, an attorney is just really being obstreperous?

Mr. Goldstein: It happens...

Justice Kennedy: He's fined $50 on 1 January, $500 on the 1 February for something else?

Mr. Goldstein: Yes.

It is never...

Justice Kennedy: And you obviously know where I'm going, if there are multiple appeals.

Mr. Goldstein: That's correct.

It has... it does happen in the district court that attorneys can be sanctioned more than one time.

Our experience, in reviewing every single example in the courts of appeals, it has never occurred that multiple appeals have been brought from the same case, and there is a reason for that.

And that is that while attorneys may get themselves sanctioned, they tend not to be so, for lack of a better term, stupid as to continue to bring their case to the court of appeals only to get shot down again and again in the Federal reports.

Chief Justice Rehnquist: But each time the court of appeals shoots them down it's another piece of appellate business that really is contrary to the policy against piecemeal appeals.

Mr. Goldstein: As a practical matter in the court of appeal, those appeals will be consolidated by the court of appeals under Rule 3.

There... it is, we respectfully submit, final as to the attorney each time a final sanction order is entered, but again...

Justice Ginsburg: So is a disqualification order, and why isn't that the closer analogy than a contempt citation?

Mr. Goldstein: There are two keys to the disqualification cases.

The first is the conclusion in Richardson-Merrell that the attorney doesn't get to appeal the disqualification.

That runs against the client, not against the attorney.

And the second is that the district court proceedings will be stayed, and it will disrupt them.

If I could reserve the remainder of my time.

Argument of John J. Arnold

Chief Justice Rehnquist: Very well, Mr. Goldstein.

Mr. Arnold, we'll hear from you.

Mr. Arnold: Mr. Chief Justice, and may it please the Court:

To respond to the questions raised to petitioner, there are alternatives which Congress has given which would adequately address the most egregious or most unjust of these cases where sanctions are imposed against attorneys.

Those alternatives are available in the appropriate case.

Secondly, there's a very practical reason for treating attorneys differently than a pure nonparty to litigation.

The attorney comes before the court solely on behalf of the client, as opposed to a third party who is distant from the litigation.

The attorney's interests are those of the client, and are entwined with the outcome of the case.

So the simple question before this Court today is whether an attorney who is sanctioned for violating a pretrial discovery order may immediately appeal that decision.

Justice O'Connor: Well, this attorney was also removed from the case, so is no longer acting as attorney, right?

Mr. Arnold: That's correct, Your Honor.

Justice O'Connor: That might make a difference.

Do... does Cohen apply?

Should we assume that Cohen applies to this...

Mr. Arnold: I believe...

Justice O'Connor: when it's a nonparty?

Mr. Arnold: I believe the analysis is different, because the interests of a pure party and the attorney are different.

Secondly, I suggest that the... whether the attorney was removed from the case or continues to participate should not affect the jurisdictional question which was before the court of appeals.

Coincidentally in this case, district court Judge Sandra Beckwith removed the petitioner on the same date as she imposed the first set of sanctions against Ms. Cunningham.

That may have happened at some later time.

Justice O'Connor: Oh, no, once the attorney is removed, it makes the person much more of a nonparty than when the attorney is still in there representing the client.

Mr. Arnold: But it does not affect the jurisdiction of the appellate courts, respectfully.

That jurisdiction should be determined as of the date the order was issued.

Subsequent events should neither confer nor take away jurisdiction, except in extraordinary cases.

For example, if the case were mooted for some reason, I would concede that that would in effect destroy or take away appellate jurisdiction if it existed, but we submit that the change in facts after the fact should not confer or destroy jurisdiction.

Justice Souter: Why would mooting of the case affect it?

Mr. Arnold: I'm sorry.

Justice Souter: The case might moot out later, but the basis for the attorney sanction would not be eliminated by the mooting of the case on the merits, would it?

Mr. Arnold: When I said that, I was referring to the attorney sanctions may become moot at a later time.

Either they might be set aside, merged into the final order, settled...

Justice Souter: You weren't saying that mooting of the case by some later event necessarily moots the attorney sanction issue that arose before it.

Mr. Arnold: No, Your Honor.

Justice Ginsburg: Okay.

You're saying whatever is the end of the line, if the case is settled, there's an order dismissing the case, is that what you're saying?

Because Mr. Goldstein brought up the possibility, well, the case could settle, and then there would be never a time that this could be appealed.

Mr. Arnold: In my experience, at some point in time there is going to be some document filed in the district court which says, this case is dismissed, this case is reversed, whatever.

There's going to be a final order filed in the district court, otherwise...

Justice O'Connor: But there would be no notice given, presumably, to an attorney who had been removed in the interim.

That attorney would not get notice of any final disposition, presumably.

Mr. Arnold: That may be true, and that may impose a slight burden upon the attorney to essentially monitor, if you will, to calendar in a tickler file, to review periodically the status of that case every 30 days or so, and I suggest that that burden is significantly less than the burdens which will be placed on the parties and the appellate courts by repeated or multiple interlocutory appeals.

Justice Ginsburg: Why isn't the contempt sanction the closest analogy?

I mean, the magistrate who imposed the Rule 37 fine could have used this contempt sanction.

Mr. Arnold: The contempt sanction is different, we believe, because contempt sanctions are typically imposed against non-parties who are unrelated to the case.

It is a more severe sanction...

Justice Stevens: Well, there's a lot of cases where the lawyers are held in contempt.

I've been in court when lawyers have been held in contempt and the case came all the way to this Court.

There are a lot of those cases.

But why... regardless of the number, why should they be treated differently?

That's the real question.

Mr. Arnold: Because their interests are different from that of a pure nonparty.

Their interests are that of the client.

The client cannot appeal a contempt... I'm sorry.

The client cannot appeal a discovery order immediately, so neither should the attorney.

It's a lesser sanction imposed against the attorney than contempt.

Justice Ginsburg: Well, my question is, why shouldn't it be treated like contempt, which is sometimes used as a way of getting interlocutory review of a discovery order?

I mean, isn't that true of the famous Hickman v. Taylor?

A lawyer was held in contempt, and that's how it got up on appeal.

Mr. Arnold: Yes, Your Honor, but to treat the cases differently we suggest supports the underlying reasons behind the rule of finality, and that is, we don't want to have multiple appeals.

And, indeed, there have been some cases which have suggested in the lower courts that when an attorney is found, even an attorney is found in contempt, his or her interests are so merged with that of a client, that of the party, that the appeal may only lie at the conclusion of the case, and that, we suggest, gives a very practical interpretation to the final judgment rule.

Justice Ginsburg: You say a contempt might not be appealable until the end?

Mr. Arnold: Yes, Your Honor.

Justice Scalia: Why... I'm sorry, I haven't followed you.

Why is it that you say a contempt citation is different from just a sanction?

Mr. Arnold: It is a more severe sanction imposed against the...

Justice Breyer: Well, that's true, but...

Mr. Arnold: client, and it is treated differently, I think, by the courts, in the case of a party as opposed to the attorney, and the reason...

Justice Scalia: Well, let's say... I'm talking about contempt citation of an attorney.

Now, do you acknowledge that that's appealable immediately?

Mr. Arnold: In not every case, Your Honor.

Justice Scalia: Not in every case?

Mr. Arnold: Not in every case.

Justice Scalia: What cases would it not be?

Mr. Arnold: For example, in the situation where the... there is a substantial congruence of interests between the nonparty, or the attorney, and the party to the action.

Justice Ginsburg: What is this case, the case that you're relying on?

Mr. Arnold: I would refer the Court to a decision of the Ninth Circuit, the coordinated pretrial proceedings in Petroleum Products antitrust litigation case, a 1984 decision of the Ninth Circuit, where the Attorney General, I believe of the State of Oregon, was sanctioned, or was found in contempt, and his interests were so congruent, or so substantially similar to that of the State of Oregon, that the court ruled that the appeal was not immediately... may not be taken immediately.

Justice Ginsburg: But I thought in all of the... at least all the contempt cases I know, taking Hickman v. Taylor, the lawyer's interest was... he was serving his client.

He was totally serving his client, and yet we took that case, and it was the great case about the scope of discovery.

Mr. Arnold: To do so, Your Honor, if the Court allows even an appeal of a contempt citation immediately, will cause the appellate courts to become entwined in reviewing more and more the facts of the underlying litigation.

Justice Scalia: Now you're arguing that we should not allow interlocutory appeals of contempt citations.

Mr. Arnold: I am.

Justice Scalia: And I'm inclined to agree with you, that if we agree with you we shouldn't allow interlocutory appeals of contempt citations.

Is that your position?

Mr. Arnold: That's an extension of the rationale that applies to this case, yes, Your Honor.

Chief Justice Rehnquist: Well, frequently, and I think this Court has admonished trial judges that if you're thinking of holding a lawyer in contempt, either tell him that you're thinking about it, but wait awhile.

In other words, don't simply cite him from the bench, but hold off for a while, and maybe do what Judge Medina did in the communist case, have a hearing at the end of the trial, and of course that would remove the appealability problem there, since surely a contempt citation with a fine at the end of the trial would be appealable.

Mr. Arnold: Yes, it would, because it would at that point merge with the final judgment of the case.

Justice O'Connor: Well, what discretion does a trial judge have to defer the effectiveness of an order of sanction, or to defer... what discretion would a court of appeals have to defer holding any hearings on it until the end of the case?

Mr. Arnold: Well, the trial court does, of course, have the discretion to decide when they are going to make that decision, when they are going to impose that sanction, or even if they... and the courts below have seen the situation where the court has found, or ordered, I'm going to sanction you for this conduct, but has not determined the final amount of the sanction.

Justice Kennedy: Uh-huh.

Mr. Arnold: Or they may say, I'm going to impose a sanction of $1,500, but stay that until the final resolution of the case.

Justice O'Connor: Stay the collection of it?

Justice Kennedy: Stay the collection of it?

Mr. Arnold: Stay the... I'm...

Justice O'Connor: They would stay... would have power to stay the collection of the sanction until the end.

Mr. Arnold: The execution of the order, yes, Your Honor.

Justice O'Connor: But would it be, do you think, would the notice of appeal have to be filed in 30 days of the entry of the order that you are sanctioned?

Mr. Arnold: If this Court adopts a rule that says that attorneys may only appeal from the final decision of the Court, no.

That notice of appeal, that appeal should be perfected within the appropriate time from the final order of the district court.

Justice O'Connor: Well, is the best resolution of this to leave it to the discretion of the court...

Mr. Arnold: In terms of...

Justice O'Connor: imposing the sanction?

Mr. Arnold: I'm sorry, Your Honor.

Justice O'Connor: Should the best resolution of this problem be to leave the effectiveness of it in the discretion of the trial judge?

Mr. Arnold: That is one resolution, but I submit the better resolution is to simply announce a bright line.

Either the attorney can appeal or not appeal, and if the interests which support the finality rule suggest that the most practical, the most judicially efficient manner of doing it is to announce the rule that the attorney may perfect that appeal at the conclusion of the case.

Justice Kennedy: The problem is, is that these sanction orders are sometimes entered by the court when its patience has run out, the court is angry at the attorney, sometimes for a good cause, sometimes not, and there's a real danger that the district judges can overstep and require an attorney to come forward with a substantial sum of money for a sanction, and that just seems to me to be a very harsh rule, especially in this case, where the attorney is out of the case.

Mr. Arnold: Your Honor, I would suggest that it's a balancing test the Court has to reach, and it's a balancing test that should be answered not just on this particular case, on a $1,500 sanction, but on the broader issue, and that is, there will be, perhaps in the case where sanctions are not stayed, some financial hardship imposed upon the attorney, just as there are financial hardships...

Justice Stevens: Well, it can go beyond financial hardship, it seems to me.

Justice Ginsburg's question raises this doubt in my mind.

Supposing a conscientious lawyer thinks that material is privileged, and he refuses to disclose it in response to a discovery demand, and the magistrate says, I'm going to sanction you $1,500 unless you pay it over.

He says, I just think professionally I can't do it.

I'm not going to turn it over.

Can they continue to... and they go ahead with the trial and try the case.

The... but they could continue to impose more and more sanctions for the same refusal, and there would be no way to review it until the case is over, even though the materials might be critical to the outcome of the case.

Mr. Arnold: And that I believe is one of the balancing factors, one of the factors the Court must take into account when it balances these things.

Do you want to have the courts of appeal reviewing evidentiary decisions before the trial is over?

Justice Breyer: In other words, have you... this is the point that I was worried about.

I mean, have you ever found a... I can't imagine a trial judge, when the lawyer says, judge, I'm going to appeal this at the end of the case, will you please stay it, and he says no.

I've never heard of such a thing.

Have you come across such a thing?

I may just be overly naive.

Mr. Arnold: We have not, Your Honor, but...

Justice Breyer: All right.

Now, suppose he did.

Suppose we ran against somebody who's having a temper tantrum, and he's going to be unreasonable.

Then under the law, are you permitted to go to the court of appeals and say, court of appeals, we'd like a writ under the All Writs Act.

All we want is for you to stay this order so we have a chance to appeal.

Would you be entitled to it, if the judge is having a temper tantrum and won't be reasonable?

Mr. Arnold: Yes, Your Honor, you would.

Justice Breyer: Would be.

Is there any authority for that?

Mr. Arnold: The All Writs Act, and there's also authority in section 1292(b) of title 28, which...

Justice Kennedy: I think Justice Breyer was asking, or at least I was thinking, is there any case on it?

Mr. Arnold: I have not seen the specific case, although this Court, in numerous decisions, has suggested that mandamus is an alternative, although one which is reserved for the most important or most appropriate of cases to interlocutory appeals, as it has suggested that 1292(b) is an alternative, and the rule-making...

Justice Ginsburg: I don't understand how 1292(b) would, because how is this order making it appealable, immediately appealable going to be the ultimate determination of the case, and how is it a controlling question as to which there's a substantial disagreement?

1292(b) is very limited in terms... it's a double certificate, and it requires it to be an important question about which there's a substantial disagreement, and that immediate determination of that question will speed the underlying lawsuit.

I don't think you can meet the 1292(b) standards.

Mr. Arnold: That may very well be the case in this particular facts, or in any attorney sanctions, that you cannot... they are not...

Justice Ginsburg: So that's why I don't think 1292(b) is in the picture.

This kind of thing just doesn't fit what that statute contemplates.

Mr. Arnold: Justice Ginsburg, if it's not the type of case that rises to the level of the urgency and the importance anticipated by section 1292(b), I would submit that it's also not the type of case that rises to the level of an important right which must be immediately determined by the court of appeals, as opposed to an interest or a question which may be answered upon the final...

Justice Stevens: Yes, but the distinction is, under 1292(b) it must relate to the merits, and under Cohen it may not relate to the merits, or have I got it backwards?

Mr. Arnold: Under Cohen it should be separable from the merits.

Justice Stevens: Separable, whereas under 1292(b) it must control the merits.

Mr. Arnold: And that is certainly a reason, we submit, that had Congress intended to expand that limited right of interlocutory appeals to this type of case, they would have done so in the language of 1292(b).

Justice Ginsburg: Well, Congress certainly recognized that finality is a problem, because it provided now twice, once in, what is it, 1272(c) and 1292(e) for rule-making to make additional... put additional things on the list of interlocutory appeals.

Mr. Arnold: That is correct, Your Honor.

Justice Ginsburg: But why... but it seems to me that that doesn't foreclose doing it by adjudication.

Mr. Arnold: It does not, but this Court has held that this is a... that the cases envisioned by Cohen are a narrow class of cases which should be strictly construed, and the ultimate question is, can the petitioner in this case obtain a fair hearing at the end of the case?

Can she file her notice of appeal at the end of the case and have her rights protected?

Unlike the cases where this Court has ruled an interlocutory appeal must lie, whether it's a right to bail bond case, or a double jeopardy case, or in immunity cases, those are cases that stop, or prevent the underlying litigation from going forward.

This case is more, or similar to that of a speedy trial question, or the question involving the disqualification of counsel.

Those are steps toward the end of the case.

They are steps toward resolving the case.

Justice Ginsburg: But you concede that some... that this is a sooner-or-later question.

That is, it's definitely reviewable ultimately.

Mr. Arnold: Yes, Your Honor.

And the question...

Justice Scalia: I don't see what harm is done by adopting the petitioner's resolution here.

I mean, I am affected by the fact that it's within the total control of the district court to prevent any disruption by simply saying, you know, I'm not going to impose this until the end of the trial, but you're going to get whacked pretty hard, and you do it again, I'm going to whack you harder, but I'll wait till the end of the trial, because I don't want the trial interrupted.

What's the problem with, once you announce the rule, the district judge knows exactly how to prevent the interference with the trial?

Mr. Arnold: The problem with that is, I think the district courts have found that that, the threat of a sanction, the threat of punishment has not been effected.

Justice Scalia: It isn't a threat, it's a promise.

Unidentified Justice: [Laughter]

Justice Scalia: At the close of the trial, I am going to impose upon you a sanction of, you know, $20,000.

Justice Stevens: How can you say they found that totally ineffective?

I think a lot of lawyers would listen to the judge when the judge said that.

Unidentified Justice: [Laughter]

Justice Stevens: I know I would.

Mr. Arnold: Unfortunately, not all attorneys do listen to the judge, and the rule the petitioner is proposing opens the Pandora's box...

Justice Breyer: The answer is, they wouldn't know.

The district judges don't know every rule, nor do we.

The lawyer's out of the case.

He's going to sanction him.

He's not there anymore.

He says goodbye, I'm not going to see you anymore, I'm going home.

And you say, fine, when you go, pay $10,000.

I mean, that's what's going to happen.

I don't know how we could prevent that, whatever rule we announce.

And then the problem it seems to me is, well, shouldn't he have an appeal at that point.

He's gone home, he is hurt, and that's the difficulty for you, I guess.

Mr. Arnold: And the Court has suggested any number of combinations that may come before the district court judge.

The practical matter is that interlocutory appeals delay and hinder the district court proceedings.

They impose additional burdens on the parties below.

They disrupt those proceedings.

Justice Stevens: That's all true, but what if we were writing the opinion, something along the lines Justice Scalia said, the better practice, absent compelling circumstances, enforcement of all these orders shall be postponed until the litigation is over.

Wouldn't that avoid the problem for everybody, and just... we could just follow the practice of waiting till the case is over?

Mr. Arnold: That would avoid the situation where it's a purely monetary sanction that's imposed, other than it would create a similar hardship on the party who's had to seek the sanction.

And again...

Justice Kennedy: In trying to think of your answer to that question, I was thinking, well, it might not be sufficient, because the judge wants an immediate sanction that works to control this attorney, but then I thought the answer to that was, if the attorney's that bad, then he can hold him in contempt.

Mr. Arnold: Or remove him from the case, and if removed from the case, the attorney would have no right of immediate appeal.

Justice Kennedy: So it seems to me that...

Justice Scalia: You wouldn't acknowledge that holding him in contempt would allow an immediate appeal anyway.

I mean, your position now is that that also is not appealable until the end of the trial.

Mr. Arnold: Because of the similarity of interests between the parties and the attorney.

Justice Ginsburg: Then the Court was wrong in Hickman v. Taylor, I suppose, in allowing that to go up as an interlocutory appeal, because of the contempt.

Mr. Arnold: In this particular case, Your Honor, we submit that there is a similarity, or such a close congruence of the relationships and the interests of the parties.

Justice Scalia: It couldn't have been closer than in Hickman.

I mean, I can't imagine a closer congruence.

Mr. Arnold: Again, this is a situation where the district court, for whatever reason, chose not to go that further step and impose the sanction order, or the contempt order.

Justice Ginsburg: There was another sanction here.

It was... and I don't... there was a $29,000 sanction that was not appealed.

What was that for?

Mr. Arnold: It was actually appealed.

At the conclusion of the case, after summary judgment had been granted, the district court judge imposed another $29,000 in sanctions against the petitioner as a result of failure... basically, her conduct from September of 1986 forward.

That was also appealed, as was another discovery order of the district court.

That case was settled, and that was in favor of the codefendant below, Correctional Medical Services.

Justice Ginsburg: But that was... it was confusing, because I thought the attorney was both sanctioned and disqualified, and that was an under $2,000 sanction, and then there's this mention of another sanction.

Was that before or after the larger one, the $29,000?

Mr. Arnold: The $1,500, or the $1,494 sanction was imposed before the $29,000 sanction.

The latter...

Justice Breyer: But...

Mr. Arnold: sanction was for her continued refusal to cooperate and provide documents which had been ordered produced by the district court.

Justice Ginsburg: After she was disqualified.

Mr. Arnold: Yes, Your Honor.

This case presents a situation where the review of the attorney sanction order is closely entwined with the merits of the underlying case.

As the Sixth Circuit recognized, it is not a case which would turn out to be completely separated from the merits of the underlying case.

Indeed, Rule 37 requires the district court in imposing sanctions to determine if the nondisclosure response or objection was substantially justified.

It is essentially another opportunity to provide a way to... for a pretrial appeal of discovery orders, because included in any review by the court of appeals would have had to have been the question of relevancy, was this information that she was sanctioned for, this discovery that was to be produced that was not produced, was it relevant.

And the court of appeals would be required to review that for an abuse of discretion, which is an inherently fact-related question, for prejudice to the opposing party as well as the willfulness or culpability of the sanctioned counsel.

We also ask this Court to consider the breadth that this Court's rationale or decision will have if it accepts the rationale advanced by the petitioner.

Certainly, it will apply to the situation where Rule 11 sanctions are imposed, as well as sanctions under 28 U.S. Code section 1927.

I would also submit that it applies to the situation where both the party and the attorney are jointly sanctioned, and in that case it would create the situation where the attorney could step forward with the appeal, but the party could not.

As to the depth of the sanction, it will certainly apply to any monetary sanction of whatever amount, and I submit that it will apply to sanctions which are less than monetary, sanctions which, in effect, cost attorneys time and money but are steps to getting on with the case, to moving the case along.

Judicial efficiency will be impaired, and delay will result.

Appellate courts will find themselves effectively reviewing pretrial discovery orders, reviewing partial records where the entire record of the proceedings below would be most helpful to them.

Justice Scalia: Couldn't the appellate court just wait, I mean, just say, you know, we have this appeal here, but we're going to hold it on our calendar until the conclusion of the trial below?

Could the appellate court do that?

Mr. Arnold: Yes, Your Honor, they could.

They could very well just postpone ruling on the case.

Justice Scalia: So I mean, if it is a real problem like that, once again there's a solution.

Justice Souter: Huh...

Mr. Arnold: I'm sorry.

May I respond to Justice Scalia?

Justice Scalia: I think Justice Breyer was about to.

Unidentified Justice: [Laughter]

Mr. Arnold: To do so will still increase the burdens on the parties in the courts below.

Whether they take the case in and say, well, we're just not going to decide it until the district court err... or, makes its decision below, and then if an appeal is filed by the attorney we'll consolidate them, we still are in the situation where we have multiple appeals.

In this case, the defendant below would be required to fight the battle on multiple fronts, if you will.

Justice Kennedy: Under Rule 11, the sanctions can sometimes be paid to the injured party and, under your rule, you'd have to pay to a third party and you might not be able to get your money back.

You might be judgment-proof.

Mr. Arnold: That is a consideration.

However, we suggest that if... the rule of repayment is the remedy to that.

If, in fact... and that has not happened in this case... petitioner had paid the money, and if for some reason the county became insolvent thereafter, and...

Justice Kennedy: But under Rule 11, sanctions are frequently paid to the injured party, to the moving party.

Mr. Arnold: Yes, and as the attorney sanctions would have been paid in this case, they would have been paid to the Hamilton County Treasurer.

Justice Breyer: All I meant by mywas that I guess you could postpone it if you're prepared to investigate the merits of the underlying case, investigate the merits of the appeal, and then decide how closely they are to related, while you happen to have 300 other cases on the docket with which the court of appeals is supposed to deal.

Now you're going to agree with that.

Mr. Arnold: think that is an example of the burdens multiple appeals impose upon the parties and the courts below.

In summary, we ask this Court to strictly construe the final judgment rule and decline to expand that narrow class of cases to which Cohen applies, to pretrial discovery sanctions imposed by the district court.

To do so, to require the appeal to be brought at the conclusion of the case will avoid judicial delays, it will serve the purposes of judicial efficiency, while giving the petitioner the opportunity at the close of the case to raise the issue on appeal.

We therefore respectfully ask this Court to affirm the decision of the Sixth Circuit Court of Appeals and rule that 28 United States Code section 1291 bars the interlocutory appeal of attorney sanction orders.

Chief Justice Rehnquist: Thank you, Mr. Arnold.

Mr. Arnold: Thank you, Your Honor.

Rebuttal of Thomas C. Goldstein

Chief Justice Rehnquist: Mr. Goldstein, you have 4 minutes left.

What case do you rely on from this Court that holds a sanction against an attorney, contempt is appealable?

Mr. Goldstein: The Hickman example, Justice...

Chief Justice Rehnquist: Did the Court discuss appealability at all in Hickman?

Mr. Goldstein: No, Mr. Chief Justice, and the Court is very clear that there aren't implicit jurisdictional holdings.

We do not claim that this Court's decision in this case is predetermined by Hickman.

Chief Justice Rehnquist: Because Hickman didn't say a word about jurisdiction.

Mr. Goldstein: I believe that that...

Chief Justice Rehnquist: It was an opinion by Justice Murphy, so...

Unidentified Justice: [Laughter]

Justice Ginsburg: Did the Third Circuit say something about jurisdiction?

Mr. Goldstein: Justice Ginsburg, I believe we are beyond my familiarity with Hickman and Taylor.

I don't want to represent to you that I know the Third Circuit's opinion in that case, but I can tell you that the Court's cases dealing with contempt do deal with very analogous situations.

Cases like Alexander and its progeny involve agents of the party to the case.

It is very, very close.

In addition, the rationale is the same.

Justice Stevens: Well, there are a lot of cases that have held that if a lawyer is held in contempt for failure to comply with a court order, it's immediately appealable.

Mr. Goldstein: We have not seen contrary authority.

I...

Chief Justice Rehnquist: But I... that's what I was asking you, Mr. Goldstein.

Is there a case from this Court holding what Justice Stevens apparently thinks there is?

Justice Stevens: The answer's yes, but I can't give it to you.

Unidentified Justice: [Laughter]

Chief Justice Rehnquist: Imagine that as an exam answer.

Unidentified Justice: [Laughter]

Justice Scalia: Mr. Goldstein, could I get your position clear on one thing?

What if the sanction had been imposed upon the party?

Mr. Goldstein: Nonappealable.

It merges into the final judgment.

That's a very clear line, we respectfully submit.

There are third parties, and there are parties who...

Justice Ginsburg: And you already told me in response to the earlier colloquy that that would be true of the lawyer as well if the lawyer and the client were jointly sanctioned.

Mr. Goldstein: Yes.

As a practical matter, that has to operate to merge into the final judgment.

That's the uniform view of the courts of appeals.

Just simply the fact that the client can't appeal, it has to...

Justice Ginsburg: So if everything else is the same, but the magistrate says, you and your client.

Mr. Goldstein: Yes, and remember that the magistrate is making a conscious decision.

Rules 11 and 37 ask the district judge to make a choice.

Is this the fault in any way of the party, or is it instead the fault of the lawyer?

And if it's the fault of the lawyer, it says, sanction the attorney.

Treat them as separate from the party.

This is not an agency point, where the attorney is appealing on behalf of her client.

It's against her, and when it's done, it's done against her.

She has been sanctioned.

There is a final decision against her.

I want to pick up, however, if I could, on the sort of parade of horribles we got from the respondent.

We submit that this has been the rule in a number of circuits for two decades.

The contempt rule has been here for more than 100 years, and this as a practical matter has not happened.

The Ninth Circuit...

Chief Justice Rehnquist: Well, if you say the contempt rule has been here for more than 100, you must know some case.

Unidentified Justice: [Laughter]

Mr. Goldstein: That is correct.

Alexander says nonparties.

Alexander says nonparties, that the final judgment would not bring up their appeal, and there has never been a contrary suggestion in a court of appeals that an attorney would not fall within that rule.

I also do believe that there is not an answer to the line drawn when the attorney isn't in the case anymore.

The respondent's view is that my client's interests are intertwined with those of her client, but she's... that... it isn't her client anymore.

Justice Ginsburg: Well, as a practical matter in this case we were just told that in fact there was continuing activity involving this lawyer, and that's what accounts for the subsequent $29,000 sanction.

Mr. Goldstein: The attorney's conduct in... the petitioner's conduct that was sanctioned at the end of the case involved her activity as counsel.

To the extent she was a witness in the case, she would be able to appeal, which is the status she had.

Thank you, Mr. Chief Justice.

Chief Justice Rehnquist: Thank you, Mr. Goldstein.

The case is submitted.