MORRISON C. ENGLAND, JR., District Judge.
On March 6, 2017, Plaintiff Narendra Sharma, Assignee for Shree Shiva LLC ("Plaintiff") filed the present action, which sought to enjoin the sale of Americana Lodge, a motel located in Redding, California. Related state court litigation was already pending in Shasta County for nuisance abatement and receivership against the registered owner of the motel, Shree Shiva, LLC.
Plaintiff, citing an assignment he purportedly received from Shree Shiva, filed a request for temporary restraining order ("TRO") concurrently with his federal complaint, which request was denied on grounds that Plaintiff failed to demonstrate the presence of an immediate irreparable injury. ECF No. 5. Given Plaintiff's status as a pro se litigant, his alternative request for a preliminary injunction was ultimately referred, on April 25, 2017, to the assigned magistrate judge for adjudication pursuant to Eastern District Local Rule 302(c). ECF No. 20. By that time, Defendant City of Redding had filed Motions to Dismiss and to Strike (ECF Nos. 14 and 15) which were also referred to the magistrate judge for disposition. ECF No. 18. After the filing of a First Amended Complaint on May 17, 2017, Plaintiff then moved to set aside a state court order appointing a receiver in proceedings involving the subject motel. ECF No. 28. Defendant City renewed its Motions to Dismiss and to Strike following its receipt of the First Amended Complaint. ECF Nos. 35-36. With the exception of the Motion to Set Aside and the initial TRO request, none of the motions enumerated above were ever ruled upon prior to the time Plaintiff filed a Notice of Voluntary Dismissal which terminated these proceedings on July 17, 2017.
Despite Plaintiff's dismissal, Defendant City filed the Motion for Sanctions now before the Court on September 15, 2017. ECF No. 48. The City's motion is based on the provisions of Federal Rule of Civil Procedure 11(c), which provides for the imposition of sanctions where court filings are "frivolous, legally unreasonable, or without factual foundation, or . . . brought for an improper purpose."
The City correctly notes that Plaintiff's voluntary dismissal of the action does not necessarily insulate him from Rule 11 liability or exposure.
Defendant City argues that Plaintiff was already warned in the state court proceedings about filing frivolous motions. Nonetheless, Plaintiff was not formally determined to be a vexatious litigant, apparently because he was not formally a party to the Shasta County lawsuit. In the only motion (aside from the TRO order filed at the very onset) actually adjudicated in this case, the assigned magistrate judge did take Plaintiff to task, and denied his Motion to Set Aside, on grounds that Plaintiff had "identified no authority for the proposition that a federal district court may set aside or otherwise vacate or invalidate an order of a state court . . ." July 12, 2017 Amended Order, ECF No. 43: 3:10-13. Nonetheless the magistrate judge denied the City's request for sanctions, stating that any such request would best be adjudicated during the hearing on the City's pending Motion to Dismiss, which also requested that sanctions be imposed.
Plaintiff dismissed his lawsuit on July 13, 2017, just over a month after the magistrate judge's Amended Order discussed above and before the magistrate judge made any ruling on either the pending Motion to Dismiss, the concurrently filed Motion to Strike, or the Motion for Preliminary Injunction. Consequently, the magistrate judge assigned to the case, and responsible for making orders and/or recommendations on those pending motions given Plaintiff's pro se status, never ruled on any of those matters or found Plaintiff's conduct to be sanctionable. Defendant City nevertheless now requests that the Court award $68,317 in attorney's fees, litigation costs and other related expenses it claims to have incurred in defending this lawsuit.
While Plaintiff's voluntary dismissal does not insulate him from Rule 11 sanctions, the fact that this lawsuit was pending for just over four months has to be considered. In addition, Plaintiff was proceeding in pro se status and is not an attorney. Although that status also is not dispositive with respect to the propriety of Rule 11 sanctions, as one court has noted, "[a] layman cannot be expected to realize as quickly as a lawyer would that a legal position has no possible merit."
For all the foregoing reasons, Defendant City of Redding's Motion for Sanctions (ECF No. 58) is DENIED.
IT IS SO ORDERED.