Kolstedt v. TMX Finance Corporate Services, Inc.

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF GEORGIA SAVANNAH DIVISION

VICTORIA FLORES CORIA, Plaintiff, CIVIL ACTION NO.: 4:23-cv-94 v. TMX FINANCE CORPORATE SERVICES, INC., Defendant.

O RDE R This matter comes before the Court on Plaintiff’s attorneys Seth Diamond and Linda Nussbaum’s failure to comply with the Court’s Text Order and failure to appear for a hearing.1 Having reviewed Plaintiff’s counsel’s Response to the Court’s Show Cause Order, (doc. 11), the Court finds that extreme sanctions including dismissal of this case and revocation of counsel’s pro hac vice admission are not warranted. Nonetheless, the Court holds Mr. Diamond and Ms. Nussbaum in civil contempt for the reasons and in the manner set forth below.

However, no attorney by that name is admitted to practice before this Court, and no such attorney has BACKGROUND2 On June 30, 2023, the Court issued a Text Order setting this case, along with twenty-five related cases, down for a hearing to be held on July 25, 2023. (Doc. 9.) The Text Order explained that the Court would hear from counsel as to whether this matter should be consolidated into Kolstedt v. TMX Finance Corporate Services, Inc., Case No. 4:23-cv-00076-RSB-CLR. (Id.) The Text Order stated, “One attorney for each party shall appear for the status conference. . . . By no later than July 21, 2023, counsel for each party shall email the undersigned’s Courtroom Deputy Clerk a list of any party or attorney requesting to attend the hearing.” (Id.) Plaintiff’s attorneys of record in this case, Seth Diamond and Linda Nussbaum, each received notice of the Text Order through the Court’s electronic case filing system on June 30, 2023. (Id.) Nonetheless, neither of these attorneys appeared at the July 25, 2023, hearing and, therefore, Plaintiff was unrepresented at the hearing. After calling this case and recording Plaintiff’s counsel’s failure to appear, the Court asked the Courtroom Deputy Clerk on the record whether either of Plaintiff’s attorneys had followed the Court’s directive to contact the Courtroom Deputy Clerk to notify the Court of the attorney who would be appearing on behalf of Plaintiff.

The Courtroom Deputy Clerk responded that counsel had not. Thus, the Court issued an Order for Plaintiff to show cause why this case should not be dismissed for failure to prosecute. (Doc. 11.)

Additionally, the Court ordered each attorney of record for Plaintiff to show cause why he or she

13.) In that scant Response, Plaintiff’s counsel stated that Mr. Diamond’s firm, Morgan and Morgan, serves as local counsel in this case and is also Plaintiff’s counsel in the Koldstedt case. (Id. at p. 1.) Additionally, Plaintiff’s counsel stated that when the Court’s June 30, 2023, Text Order was entered Ms. Nussbaum “was conducting a two-day deposition in a complex antitrust MDL.” (Id.) Plaintiff’s counsel “assumed . . . that the Morgan and Morgan attorneys attending the Status Conference would appear for all clients represented by the Morgan firm.” (Id. at p. 2.)

DISCUSSION The Court’s power to find attorneys appearing before it in civil contempt for disobeying the Court’s orders and failing to appear is well established. “Courts have inherent power to enforce compliance with their lawful orders through civil contempt.” Citronelle-Mobile Gathering, Inc. v. Watkins, 943 F.2d 1297, 1301 (11th Cir. 1991) (citing Shillitani v. United States, 384 U.S. 364, 370 (1966)). Any finding of civil contempt—willful disregard of the authority of the Court—must be predicated upon “clear and convincing evidence” that the underlying order was violated.

Howard Johnson Co. v. Khimani, 892 F.2d 1512, 1516 (11th Cir. 1990). Such “clear and convincing evidence must establish that: (1) the allegedly violated order was valid and lawful; (2) the order was clear and unambiguous; and (3) the alleged violator had the ability to comply with the order.” Riccard v. Prudential Ins. Co., 307 F.3d 1277, 1296 (11th Cir. 2002). “Also, the absence of willfulness is not a defense to a charge of civil contempt, as this Court does not focus on subjective beliefs or intent in complying with the order, but whether in fact the contemnor’s conduct complied with the order itself.” Martinez-Garcia, 2013 WL 5606366, at *1 (citing FTC v. Leshin, 618 F.3d 1221, 1232–33 (11th Cir. 2010)).

Here, both of Plaintiff’s attorneys of record received the June 30, 2023, Text Order setting the July 25, 2023, hearing well in advance of the hearing. The Text Order was valid, lawful, clear, and unambiguous, and each attorney failed to comply with the Text Order despite their ability to do so. In fact, Plaintiff’s counsel admitted they “did not comply with the Court’s directives regarding [the] Text Order as the result of an inadvertent mistake,” without citing any conflict or extenuating circumstance that actually prevented them from complying. (Doc. 13, p. 2 (emphasis added).)

The Court finds Plaintiff’s counsel’s brief explanations for their failure to attend the hearing woefully inadequate. The fact that Ms. Nussbaum was attending a deposition at the time the Text Order was issued is irrelevant. The Text Order was issued weeks in advance of the hearing. Further, all the numerous attorneys who received notice of the hearing undoubtedly had busy practices and were involved in other cases, and they were all likely otherwise occupied on the date of the Text Order. Yet, except for Plaintiff’s counsel in this case and two other cases those other industrious attorneys found time to read the Text Order and follow its directives.3 Further, the fact that other members of Mr. Diamond’s law firm represent plaintiffs in related cases is also irrelevant. Those attorneys have not entered an appearance in this case and, therefore, could not have spoken on behalf of Ms. Coria at the hearing.4 Particularly given the Court’s requirement that counsel email the Courtroom Deputy Clerk days before the hearing with the name of the

CONCLUSION For the reasons set forth above, the Court finds that Plaintiff’s counsel’s failure to comply with the Court’s Text Order, (doc. 9), and failure to appear before the Court warrants a finding of civil contempt as to each of Plaintiff’s attorneys of record. However, harsh sanctions including dismissal of this action or revocation of counsel’s pro hac vice admission are not warranted. Thus, the Court FINDS each of Plaintiff’s attorneys, Seth Diamond and Linda Nussbaum, in civil contempt and ORDERS them to each pay $1,000 to the Clerk of Court on or before August 10, 2023. This sanction should strike the appropriate parsimony balance and prevent any further disregard of the Court’s orders. However, should counsel demonstrate similar failures in this or other cases in the future, the Court will impose stiffer sanctions.

Additionally, the Court ORDERS Plaintiff to file a statement within seven (7) days of the date of this Order stating whether Plaintiff agrees that this case should be consolidated into Kolstedt v. TMX Finance Corporate Services, Inc., Case No. 4:23-cv-00076-RSB-CLR.® SO ORDERED, this 4th day of August, 2023.

ASA “ R. STAN BAKER UNITED STATES DISTRICT JUDGE SOUTHERN DISTRICT OF GEORGIA ® Given that this directive pertains to proceedings in Kolstedt, the Court DIRECTS the Clerk of Court to file this Order on the docket of that case as well as the docket of this case. Additionally, given the potential for this case to be consolidated into the Kolstedt case, Plaintiffs counsel should monitor that case and stay abreast of the Court’s orders entered in Kolstedt.