UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA
April 20, 2011
REDLINE RECOVERY SERVICES, LLC; JAY RILEY; KEN HARDY, DEFENDANTS.
The opinion of the court was delivered by: Hon. Roger T. Benitez United States District Judge
ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF'S MOTION FOR SANCTIONS
Plaintiff Aaron Weakley moves for sanctions against Defendant's counsel for publically filing documents containing Plaintiff's social security number, without redaction, in violation of Federal Rule of Civil Procedure 5.2. Defendant's counsel opposes the imposition of sanctions. Because the Court finds that Defendant's counsel acted in bad faith, Plaintiff's request for sanctions is GRANTED in part and DENIED in part.
The Court has the inherent power to issue sanctions. Primus Auto. Fin. Servs., Inc. v. Batarse, 115 F.3d 644, 648 (9th Cir. 1997). "The most common utilization of inherent powers is a contempt sanction levied to protect the due and orderly administration of justice and maintain the authority and dignity of the court." Id. (internal quotations and citations omitted). To award sanctions under the Court's inherent power, "the court must make an explicit finding that counsel's conduct 'constituted or was tantamount to bad faith.'" Id. (quoting Roadway Express, Inc. v. Piper, 447 U.S. 725, 767 (1980)). A party can "demonstrate bad faith by 'delaying or disrupting the litigation or hampering enforcement of a court order.'" Id. at 649 (citing Hutto v. Finney, 437 U.S. 678, 689 n.14 (1978)). The Court has "broad fact-finding powers with respect to sanctions, and its findings warrant great deference," but the Court must be explicit. Id. at 649; see also Mendez v. Cnty. of San Bernardino, 540 F.3d 1109, 1132 (9th Cir. 2008) (reversing award of sanctions, in part, because district court failed to make explicit finding of bad faith).
Defendant's counsel unquestionably violated Federal Rule of Civil Procedure 5.2. Rule 5.2 specifically requires that in a "filing with the court that contains an individual's social security number . . . a party or nonparty making the filing may include only: (1) the last four digits of the social-security number." Defendant's counsel filed two documents containing Plaintiff's complete social security number. Defendant's counsel was unquestionably on notice of his obligation, under Rule 5.2, to redact Plaintiff's social security number. To access the Court's CM/ECF system, Defendant's counsel is required to check a box that indicates "I understand that, if I file, I must comply with the redaction rules. I have read this notice." The notice directly above this language and the check-box states, "IMPORTANT NOTICE OF REDACTION RESPONSIBILITY: All filers must redact: Social Security . . . numbers . . . in compliance with Fed. R. Civ. P. 5.2 . . . . This requirement applies to all documents, including attachments." Additionally, Defendant's counsel had previously redacted his own client's protected information, evidencing his knowledge of the requirement. This is not a situation where Defendant's counsel was unaware of the requirement or was not given reasonable notice of what was expected. Mendez, 540 F.3d at 1132.
In failing to comply with Rule 5.2, Defendant's counsel made Plaintiff's full social security number available to the public. While counsel eventually corrected the mistake, Plaintiff's information was publically available over the internet for more than three weeks. Defendant's counsel's attempt to construe Plaintiff's failure to bring the violation to his attention sooner as a waiver is not well taken. It is not Plaintiff's or the Court's responsibility to comb through Defendant's filings in search of counsel's violations. And any delay by Plaintiff in bringing the violation to Defendant's attention certainly is not the equivalent of a waiver because Plaintiff did not file his social security number without redaction. FED. R. CIV. P. 5.2(h) ("A person waives the protection of Rule 5.2(a) as to the person's own information by filing it without redaction and not under seal.")
The Court need not detail the serious consequences individuals suffer when their social security numbers are publically broadcast over the internet for any would-be identity thieves. This is evident, not only from the information filed by Plaintiff in support of his motion, but also from Rule 5.2 itself and this district's requirement that any filer affirmatively indicate knowledge of and compliance with the Rule to access the filing system. The violation is particularly troubling in this instance because Plaintiff is serving in the military in Afghanistan, limiting his ability to personally protect his now compromised social security number from identity thieves.
Defendant's counsel's conduct was clearly reckless, but, contrary to Plaintiff's position, recklessness is not enough. "[R]ecklessness . . . is an insufficient basis for sanctions under a court's inherent power. Instead, counsel's conduct must constitute or be tantamount to bad faith." In re Keegan Mgmt. Co., Sec. Litig., 78 F.3d 431, 436 (9th Cir. 1996) (internal citations and quotations omitted). In support of a showing of bad faith, Plaintiff points to this blatant violation, as well as a previous "erroneous" filing with the Court. Defendant's counsel filed a 14-page document with the Court with Plaintiff counsel's electronic signature when Plaintiff's counsel had only reviewed a 7-page document.
The Court finds that Defendant's counsel's conduct, particularly his blatant violation of a Rule he affirmed shortly before filing, has sufficiently disrupted this litigation to warrant the imposition of some sanction. Primus, 115 F.3d at 649 (A party can "demonstrate bad faith by delaying or disrupting the litigation"). Plaintiff requests (1) ten years of credit monitoring for Plaintiff; (2) a $5,000 payment to the National Association of Consumer Advocates; and (3) payment of Plaintiff's attorney's fees, totally $1,817. The Court finds that $900.00, for five years of credit monitoring, is a reasonable sanction for Defendant's counsel's conduct.*fn1 Defendant's counsel shall pay $900.00 to Plaintiff on or before May 20, 2011.
Plaintiff's motion for sanctions is GRANTED in part and DENIED in part. Defendant's counsel shall pay Plaintiff $900.00 on or before May 20, 2011.
IT IS SO ORDERED.