U.S. Court of Appeals for the Ninth Circuit KAASS LAW v. Wells Fargo
On August 27, 2015 KAASS LAW filed docket number D.C. No. 2:12-cv-08356-RGK-JC with the United States Court of Appeals for the Ninth Circuit and challenged the district court’s decision in granting Wells Fargo’s motion for sanctions under 28 U.S.C. 1927.
This issue was raised for the first time in history on appeal by KAASS LAW. On appeal KAASS LAW made two principal arguments, however before hearing the second argument, the panel held that § 1927 does not permit the imposition of sanctions against a law firm. The 9th Circuit Court reversed and vacated the district court’s order, holding that § 1927 does not permit sanctions against a law firm. Thus, the panel reversed the district court’s decision in granting Well Fargo’s motion for sanctions against KAASS LAW pursuant to 28 U.S.C. § 1927, and vacated the order imposing sanctions on KAASS LAW.
First Argument:
KAASS LAW argued the district court abused its discretion by imposing sanctions pursuant to 28 U.S.C. § 1927 because sanctions under that statute can only be made against an individual attorney, and not against a law firm.
Second Argument:
KAASS LAW’s second argument opposed the district court’s finding of bad faith. However, the 9th Circuit agreed with KAASS LAW’s first argument that the district court abused its discretion when it imposed sanctions against a law firm pursuant to 28 U.S.C. § 1927. Thus, the court did not reach the second argument.
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