Hollister v. Soetoro , 258 F.R.D. 1 ( 2009 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
GREGORY S. HOLLISTER, :
:
Plaintiff, :
:
v. : Civil Action No. 08-2254 (JR)
:
BARRY SOETORO, et al., :
:
Defendants. :
MEMORANDUM ORDER
We live in a free country. Our liberties are manifold
and are the envy of the world. In the very top tier of those
liberties, enshrined in the First Amendment, is “the right of the
people . . . to petition the Government for a redress of
grievances.” Many of those petitions are presented to judges.
Every judge knows that a disturbingly high percentage of them
involve petty slights, or imagined injuries, or matters that lie
well beyond the reach of the judicial writ, but most judges will
agree that it is important at least to listen to them --
especially to the grievances of poor petitioners, or
disadvantaged petitioners, or petitioners who do not have
lawyers -- even if the courts are powerless to grant relief.
Lawyers who come to court to present grievances,
however, are held to a higher standard than disadvantaged or
unrepresented persons. For lawyers, there are rules. A lawyer
knows that no judge has any business addressing or ruling upon a
dispute, no matter how fervently he or his clients may feel about
it, unless the judge has both personal and subject matter
jurisdiction, unless the client has standing to be heard, unless
the cause is ripe and justiciable, and unless the complaint
states a claim upon which relief can be granted. A lawyer who
comes to federal court also knows, because the Federal Rules of
Civil Procedure plainly say so, that his signature on a complaint
“certifies that to the best of the person’s knowledge and belief,
formed after an inquiry reasonable under the circumstances,” the
complaint “is not being presented for any improper purpose,” Rule
11(b)(1), and that “the claims . . . and other legal contentions
are warranted by existing law or by a nonfrivolous argument for
extending, modifying, or reversing existing law or for
establishing new law,” Rule 11(b)(2).
John D. Hemenway is a lawyer and a member of the bar of
this court. The dispute that he attempted to litigate here was
about whether or not Barack Obama is a “natural born Citizen,”
and thereby qualified under Article II, section 1 of the
Constitution to be President. Many people, perhaps as many as a
couple of dozen, feel deeply about this issue. Attempts have
been made to tee the question up for judicial resolution in a
number of courts across the country. See, defendant’s motion to
dismiss [Dkt. #9-1 p. 3, n.1]. Mr. Hemenway’s associate,
Philip J. Berg, made at least one such attempt, suing in a
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federal court in Pennsylvania, naming himself as plaintiff.
After that suit was dismissed (for lack of standing), and after
the Supreme Court declined to hear him, Mr. Berg (apparently)
found another plaintiff, a man who retired from the Air Force as
a colonel more than ten years ago and now claims to be uncertain
about whether -– if he were recalled to active duty -– he would
have to obey commands that come from President Obama as
commander-in-chief. Mr. Berg (presumably) enlisted Mr. Hemenway
in this cause. Mr. Hemenway, Mr. Berg, and Lawrence J. Joyce
then filed this lawsuit.1 Mr. Hemenway signed the complaint,
certifying his compliance with Rule 11(b).
The complaint asserts a single cause of action,
invoking the interpleader statute, 28 U.S.C. § 2235. That
statute provides:
(a) The district courts shall have original
jurisdiction of any civil action of interpleader or in
the nature of interpleader filed by any person, firm,
or corporation, association, or society having in his
or its custody or possession money or property of the
value of $500 or more, or having issued a note, bond,
certificate, policy of insurance, or other instrument
of value or amount of $500 or more, or providing for
the delivery or payment or the loan of money or
property of such amount or value, or being under any
obligation written or unwritten to the amount of $500
or more, if
(1) Two or more adverse claimants, of diverse
citizenship as defined in subsection (a) or (d) of
section 1332 of this title, are claiming or may claim
1
Messrs. Berg and Joyce are not members of the bar of this court and
were not granted leave to appear pro hac vice. See [#10].
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to be entitled to such money or property, or to any one
or more of the benefits arising by virtue of any note,
bond, certificate, policy or other instrument, or
arising by virtue of any such obligation; and if
(2) the plaintiff has deposited such money or property
or has paid the amount of or the loan or other value of
such instrument or the amount due under such obligation
into the registry of the court, there to abide the
judgment of the court, or has given bond payable to the
clerk of the court in such amount and with such surety
as the court or judge may deem proper, conditioned upon
the compliance by the plaintiff with the future order
or judgment of the court with respect to the subject
matter of the controversy.
(b) Such an action may be entertained although the
titles or claims of the conflicting claimants do not
have a common origin, or are not identical, but are
adverse to and independent of one another.
I have said nothing, and have nothing to say, about the
merits of the “natural born Citizen” question that Messrs.
Hemenway, Berg, et al., have sought to present here. I have no
business addressing the merits, because, having found that
Mr. Hemenway’s interpleader suit failed to state a claim upon
which relief can be granted, I have dismissed it. The only
question that remains before me is whether Mr. Hemenway, when he
signed the complaint, violated Rule 11(b). It seemed to me when
I dismissed the complaint, on March 5, 2009, that Mr. Hemenway’s
invocation of the interpleader statute as the vehicle for his
complaint was completely frivolous. For that reason, and in
compliance with Rule 11(c)(3), I ordered Mr. Hemenway to show
cause why I should not find him in violation of Rule 11(b),
either because he presented the suit for an improper purpose,
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Rule 11(b)(1), or because his claims and other legal contentions
were not “warranted by existing law or by a nonfrivolous argument
for extending, modifying, or reversing existing law or for
establishing new law,” Rule 11(b)(2), or both. Mr. Hemenway,
responding to that order, has filed about 35 pages of argument
and self-justification. Most of his submission deals with the
merits of his claim, which, again, are not the subject of the
present memorandum.
In so far as Mr. Hemenway’s submission addresses the
legal sufficiency of his interpleader claim, his argument may be
summarized as follows:
(I.) The word “property” in the interpleader statute,
28 U.S.C. § 1335, must be construed broadly. For this
proposition, Mr. Hemenway cites no authority construing the word
“property” as it appears in the interpleader statute; he cites
only cases decided in the context of other statutes: Carpenter v.
U.S., 484 U.S. 19 (1987) (confidential information is “property”
within the meaning of the mail and wire fraud statute); First
Victoria Nat. Bank v. U.S., 620 F.2d 1096 (5th Cir. 1980) “rice
history acreage” is “property” for estate tax purposes); Matter
of Nichols, 4 B.R. 711 (E.D. Mich 1980) (in bankruptcy law,
“property” refers to “one, or some, of whatever kind of those
items which are subject to ownership, whether it is tangible or
intangible, visible or invisible, corporeal or incorporeal, real
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or personal”); and Glosband v. Watts Detective Agency, Inc., 21
B.R. 963, 971-72 (D.Mass. 1981) (in bankruptcy law, “property”
interpreted “most generously” to incorporate “anything of value
which but for the transfer might have been preserved for the
trustee to the ultimate benefit of the bankrupt's creditors”).
(ii.) Mr. Hollister’s “duty” can be the subject of an
interpleader action. Here, Mr. Hemenway cites Bank of Neosho v.
Colcord,, 8 F.R.D. 621 (W.D.Mo. 1949), for the proposition that
“a duty with respect to a sum of money has . . . been found to be
a proper matter for interpleader.” [Dkt. #23, p. 10.] That is a
significant distortion of the decision. Colcord (even if it were
controlling law, which it is not) does not support Mr. Hemenway’s
point. Colcord was a traditional interpleader case that involved
a contract for the sale of a ranch. The sale “failed,” whereupon
the disinterested stakeholder, uncertain whether to disburse the
$5,000 earnest money to the contract seller or the contract
buyer, deposited the funds in the registry of the court and sued
for interpleader. The contract buyer then cross-claimed against
the contract seller for specific; the contract seller moved to
dismiss because the cross-claim was not for interpleader; and the
court denied the motion, deciding nothing more than that a cross-
claim for the “duty” of specific performance would lie in the
same case because it involved the same subject matter as the
underlying interpleader action.
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(iii.) An interpleader case does not require a formal
demand on the plaintiff or even a deposit with the court. Here
Mr. Hemenway cites Dunbar v. United States, 502 F.2d 506, 511
(5th Cir. 1974). Worse than distorting the holding of that case,
he completely misstates it. In Dunbar, the post office refused
to deliver a suspicious package of money, and the United States
filed an interpleader action to see who might claim it. The
court was harshly critical of the government’s resort to “cosmic
interpleader,” id. at 512, and refused to allow the government to
use the suit as a vehicle for the conduct of broad discovery.
What Mr. Hemenway should have gleaned from the case was the
court’s finding that “a prerequisite for [interpleader] is that
the party requesting interpleader demonstrate that he has been or
may be subjected to adverse claims.” American Fidelity Fire Ins.
Co. v. Construcciones Werl, Inc., 407 F. Supp 164, 173 (D.V.I.
1975), which Mr. Hemenway cites with Dunbar, is to the same
effect. Underwriters at Lloyd’s v. Nichols, 363 F.2d 357 (8th
Cir. 1966), an exhaustive and scholarly opinion, comes to the
same conclusion, concluding that interpleader requires real
claims, or at least the threat of real claims -- not theoretical,
polemical, speculative, or I’m-afraid-it-might-happen-someday
claims.
(iv.) No court has held “that [an] intangible res
cannot be the subject of Interpleader.” [Dkt. #23, p. 11]. This
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proposition is remarkable only for the authorities Mr. Hemenway
cites to support it: Martin v. Wilks, 490 U.S. 755 (1989) (a
decision that has nothing to do with any issue in this case, as
nearly as I can tell); and N.O.W. v. Scheidler, 510 U.S. 249(1994) (statutory construction: motivation of economic purpose
will not be read into RICO statute). Moreover, one might add, no
court has held that a claim made for the first time cannot on
that account be found frivolous, or that “creativity” confers
immunity from Rule 11 sanctions.
Perhaps the most interesting case that Mr. Hemenway
cites -– interesting because, more than any of the others in his
submission, it demonstrates just what is wrong with his
interpleader claim -- is Xerox Corp. v. Nashua Corp., 314 F. Supp
1187 (S.D.N.Y. 1970). Xerox sued Nashua for infringing its
patent on copy paper. Nashua counterclaimed to interplead RCA,
asserting that, if it was infringing Xerox’s patent, it was also
infringing a patent owned by RCA, and that it did not know to
which party it should pay royalties. Judge Weinfeld observed,
id. at 1189:
Although Nashua's invocation of interpleader in this
case is novel, its assertion that if the two patents
interfere, interpleader should lie because of the risk
of multiple liability is not without appeal. Rule
22(1) of the Federal Rules of Civil Procedure
authorizes an interpleader action where (1) two or more
persons have claims against the interpleading party,
and (2) as a result, the interpleading party is or may
be exposed to multiple liability. It is no longer
required that the claims be of common origin or that
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the interpleading party be a wholly neutral
stakeholder. The rule does not even require a ‘stake’
or ‘fund’ as such. The action will lie where all that
is involved is the threat of multiple liability on what
is in fact but a single claim or obligation. While the
patent situation is more complex than the normal
interpleader situation, its complexity alone does not
foreclose interpleader.
Judge Weinfeld dismissed the interpleader claim, however, finding
that “the postulated situation envisaged by Nashua remains no
more than a conjectural view of possible conflicting holdings,”
id. at 1190 (emphasis added). Judge Weinfeld went on to state,
id.:
The court is not prepared to cast Xerox and RCA in the
role of unwilling litigants where, upon substantial
grounds, they challenge the validity of the basis upon
which Nashua seeks to force them into adversary
positions, while Nashua presents only its bare
conclusions in support of its position. Although
parties should be protected against multiple and
conflicting liability . . . unjustified interpleader
proceedings in a case such as this have substantial
disadvantages.
“The case offered no hope whatsoever of success, and
plaintiffs’ attorneys surely knew it.” That was the finding of
Judge Jackson in Saltany v. Reagan, 702 F. Supp. 319, 322 (D.D.C.
1988), a case in which, as in this one, the plaintiffs had an axe
to grind -– a case, like this one, that “[t]he Court surmise[d]
was brought as a public statement of protest of Presidential
action with which counsel (and, to be sure, their clients) were
in profound disagreement.” Finding that the plaintiffs’
injuries were not insubstantial (plaintiffs were suing for
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injuries, deaths, and losses suffered in the 1986 American
airstrikes against Libya), Judge Jackson concluded that the suit
was not “frivolous so much as it is audacious,” and he declined
to find a Rule 11 violation or to impose sanctions on counsel.
Saltany, 702 F. Supp. at 322. The Court of Appeals reversed, 886
F.2d 438 (D.C. Cir. 1989). The trial court’s finding that “[t]he
case offered no hope whatsoever of success, and plaintiffs'
attorneys surely knew it” was, the Court of Appeals held, a
finding “in substance if not in terms, that plaintiffs' counsel
had violated Rule 11.” Id. at 440.2 Judge Jackson had been
inclined to cut counsel a break, because their suit was brought
as a “public statement of protest.” The Court of Appeals was not
so inclined: “We do not conceive it a proper function of a
federal court to serve as a forum for ‘protests,’ to the
detriment of parties with serious disputes waiting to be heard.”
Ibid.This case, like Saltany, offered no hope whatsoever of
success, and Mr. Hemenway surely knew it. Mr. Hemenway had no
colorable authority for the proposition that Mr. Hollister’s
contingent claim of “duty” could be the res in an interpleader
suit, or, given the speculative and contingent nature of such a
2
That holding was reaffirmed, on a second appeal, by the law of the
case doctrine, see Saltany v. Bush, 960 F.2d 1060 (D.C. Cir. 1992), over the
dissent of Judge Wald that “no hope whatsoever of success” was “not an
appropriate substitute for the findings required by Rule 11,” id. at 1061.
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“duty,” that his claim had any particular dollar value.
Mr. Hemenway’s complaint did not even allege the sine qua non of
an interpleader suit -– that “[t]wo or more adverse
claimants . . . are claiming or may claim to be entitled to such
money or property, or to any one or more of the benefits . . .
arising by virtue of any such obligation. . . .” 28 U.S.C.
§ 1335(a)(1). Mr. Hemenway’s suit was not a suit in interpleader
or in the nature of interpleader. It was legally frivolous.
By signing and filing a legally frivolous complaint, Mr. Hemenway
violated at least Rule 11(b)(2).
The Court of Appeals remanded Santany to Judge Jackson
with instructions to impose a sanction, since, when that case was
decided in 1989, a sanction was mandatory upon a finding of a
Rule 11 violation. The 1993 amendments to Rule 11 made the
imposition of sanctions discretionary with the trial court.
Extensive Advisory Committee Notes explained that “the purpose of
Rule 11 sanctions is to deter rather than compensate.” Rule
11(c)(4) thus contemplates and permits a monetary sanction in the
form of a penalty, but such a sanction is now limited to “what
suffices to deter repetition of the conduct or comparable conduct
by others similarly situated.”3
3
My order to show cause in this case [Dkt. #22] suggested, as one
appropriate sanction, that Mr. Hemenway be ordered to pay the attorneys’ fees
and expenses that his improper filing made necessary. Mr. Hemenway correctly
observes, however, that Rule 11(c) no longer permits an order for the payment
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Mr. Hemenway is 82 years old and takes considerable and
justified pride in his patriotic public service and his status as
a Rhodes Scholar. He is unlikely to repeat the conduct that gave
rise to this proceeding, and in his case the permissible
alternative sanction of a reprimand will be sufficient. “Others
similarly situated” -– the people who put Mr. Hemenway up to
filing this foolish suit – are unlikely to be deterred, except by
a penalty that would be unreasonable to impose on Mr. Hemenway
alone.4
John D. Hemenway is hereby reprimanded for his part in
the preparation, filing, and prosecution of a legally frivolous
suit in this court. The order to show cause [Dkt. #22] is
discharged. It is SO ORDERED.
JAMES ROBERTSON
United States District Judge
of attorney's fees and expenses except upon motion -– and no such motion has
been filed.
4
See http://www.obamacrimes.info/ (last visited 3/24/09) “02/13/09:
PRESS RELEASE - Berg Fighting On. 3 Pending Lawsuits to Expose Obama for ‘not’
being Constitutionally ‘qualified/eligible’ to be President and Berg requests
help to spread the word as the major media refuses . . . Request - Everyone
who can - Please raise, by asking four [4] friends @ $15.00 each, or
contribute $60.00 to us now. You can use PayPal or credit card on our website
or mail a check. ”
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