United States District Court, D. Utah, Central Division
GARTH O. GREEN ENTERPRISES, INC., GARTH O. GREEN, and MICHAEL GREEN, Counterclaim Defendants,
STANDARD PLUMBING SUPPLY, INC., Counterclaim Plaintiff. STANDARD PLUMBING SUPPLY, INC., Crossclaim Plaintiff,
HARWARD IRRIGATION, Crossclaim Defendant.
J. Furse Magistrate Judge.
MEMORANDUM DECISION AND ORDER GRANTING IN PART AND
DENYING IN PART MOTION FOR ORDER TO SHOW CAUSE
Nuffer United States District Judge.
Plumbing Supply, Inc. (“Standard”) and Richard
Reese request a hearing and move for an
expedited order to show cause why attorney Marcus R. Mumford
should not be held in contempt and suspended from the
practice of law for violation of the court's order
requiring immediate payment of the $25, 115.74 sanction award
(“Motion for Order to Show Cause”).
Marcus R. Mumford opposes the Motion for Order to Show Cause
(“Opposition”).Standard filed a reply in support
of the Motion for Order to Show Cause
(“Reply”). For the reasons below, the Motion is
GRANTED IN PART AND DENIED IN PART.
January 18, 2017, an order was entered granting
Standard's motion for sanctions against counsel for the
Greens, Mr. Mumford (“Rule 11
Order”). The order explained that the Greens'
unfair competition claim was devoid of merit and frivolous
and that the Greens' counsel was given an opportunity to
withdraw the claim, but refused to do so. The order
explained that because Mr. Mumford was the Greens'
counsel at the time of filing the Amended Complaint
containing the frivolous claim and had refused to withdraw
it, and that there was “no indication that the Greens
made misrepresentations to their attorney or failed to
disclose relevant facts, ” Mr. Mumford alone would be
sanctioned. The order requested that Standard file a
motion for determination of sanctions to determine the
appropriate amount of sanctions.
February 13, 2017, after full briefing on the determination
motion, an order was entered instructing Mr. Mumford to pay
$25, 115.74 to Standard Plumbing within 28 days
(“Sanctions Award Order”). Standard had
requested in its determination motion that the entire amount
of $25, 115.74 be paid within 10 days. In opposing the
determination motion, Mr.
did not argue that a hardship would be imposed by ordering
him to pay within 10 days. Instead, he argued that the
amount of the award was too high and opposing
counsel had engaged in questionable billing practices. Those
arguments were rejected. Nevertheless, Mr. Mumford was
allotted 18 additional days by the court to pay the full
payment was due on Monday, March 13, 2017. On March 10, 2017
at 5:27 p.m.- the Friday before the Monday on which the
payment was due-Mr. Mumford filed a motion to seal a
forthcoming motion that would seek a stay of enforcement of
the Sanctions Award Order. For the first time, Mr.
Mumford raised hardship arguments and stated he was unable to
pay. After full briefing on the motion to seal, the motion
was granted and Mr. Mumford was allowed to file his motion to
stay enforcement by March 13, 2017 at 4:00 p.m. At 8:34 p.m.,
Mr. Mumford filed the motion to stay. He did not
file the motion to stay under seal. Mr. Mumford argued that
personal circumstances and circumstances with his law
practice did not allow him to pay the full sanctions amount
by the deadline. He requested a stay of enforcement or a
payment plan. The only evidence Mr. Mumford provided in
support of his inability to pay was a personal declaration
stating his financial condition. There were no attached
exhibits such as bank statements or financial statements. The
declaration was inconclusive. For example, the declaration
did not state the fees Mr. Mumford generated in this matter
since February 13, 2017, the date of the Sanctions Award
Order. The declaration did not state the fees Mr. Mumford
generated in other matters since February 13, 2017. The
declaration did not give any details of the revenue,
receivables or collections his law practice. Nor was an
overall picture of his personal financial condition included.
The declaration did not describe any attempt to obtain a loan
to satisfy payment of the sanctions amount which would
provide Mr. Mumford a payment plan as he desired. The
declaration did explain that he was unable to
encumber any jointly owned assets, but did
not explain whether he could encumber personal
assets or assets of his law firm, such as accounts
receivable. Standard opposed the motion to
stay. The motion to stay was denied, and Mr.
Mumford was ordered to “immediately pay $25, 115.74 to
Standard Plumbing.” That order was entered on
Friday, March 17, 2017.
Monday, March 20, 2017, Mr. Mumford still had not paid the
sanctions amount, so Standard filed the Motion for Order to
Show Cause currently under review. On Wednesday, March 22,
2017, the parties were ordered to “contact Magistrate
Judge Wells's chambers on or before March 27 to set a
settlement and status conference” on the Motion for
Order to Show Cause. After confidential briefing before Judge
Wells, and a settlement conference held on April 5, 2017, the
parties were unable to reach a settlement on the Motion for
Order to Show Cause.
next day, on April 6, 2017, the following order was entered:
DOCKET TEXT ORDER taking under advisement 250 Motion for
Order to Show Cause. Briefing of the 250 motion will be
conducted in the regular course.
Any response must be filed on or before
4/20/17. Any reply must be filed on or before 14
days from the date any response is filed.
The 250 Motion for Order to Show Cause requests an order (1)
holding Mr. Mumford in contempt for failing to pay the
sanctions amount and (2) suspending Mr. Mumford from the
practice of law until he pays the sanctions amount. The 250
Motion also seeks additional fees associated with enforcement
of the sanctions orders. This case, at this time, is not the
proper forum to consider barring Mr. Mumford from practice in
this court. Therefore, any response and reply shall be
limited to discussion of contempt and additional fees. Signed
by Judge David Nuffer on 4/6/17. No attached document. (kjw)
pursuant to the April 6, 2017 order, it was determined that
the matter would not be expedited, as Standard had requested,
but would be “conducted in the regular course[,
]” and Standard's request to bar Mr. Mumford from
the practice of law would not be considered in this case at
this time. Thus, the request for expedited
treatment was denied and the order signaled that this
proceeding was not a proper forum to bar Mr. Mumford from the
court. The remaining issues raised in the Motion for Order to
Show Cause will be addressed in this order.
February 13, 2017, when the initial Sanctions Award Order was
entered, there has been a substantial amount of litigation
for which the parties have incurred additional fees.
Specifically, Standard was required to:
(1) prepare a response to Mr. Mumford's motion to stay
the Sanctions Award Order;
(2) attempt to collect on the Sanctions Award Order;
(3) expend efforts to enforce the subsequent order affirming
the Sanctions Award Order and attempt to have Mr. Mumford
comply with the mandate to immediately pay the sanctions
(4) prepare a Motion for Order to Show Cause after Mr.
Mumford had not complied with the orders of the court;
(5) prepare for and participate in a settlement conference
regarding the Motion for Order to Show Cause; and
(6) prepare a reply in support of the Motion for Order to
these items required Standard to confer with counsel and
determine a course of action. The total amount of additional
fees incurred by Standard in attempting to enforce compliance
with the Sanctions Award Order is $8, 967.10.
has refused a payment plan from Mr. Mumford. Mr. Mumford has
sent two checks-one for $2, 500 dated March 13,
2017 and one for $2, 500 dated April 21,
2017-to Standard. Standard has refused to
deposit the checks.
Mumford stated in his most recent filing that: “I
recently analyzed my financial condition and determined that,
from the date that the court ordered that I pay $25, 115 in
sanctions, i.e., February 13, 2017, to the present, after
satisfying my obligations to make payroll for my staff,
alimony and child support payments, and office rent, there
was a balance of approximately $15, 000. Of that amount, I
paid $5, 000 of it to Standard towards the court's
sanctions orders, approximately $2, 00-4, 000 to myself for
living expenses in that time period, and approximately $6,
000-7, 000 toward other business expenses, with additional
expenses being put on credit cards, as I prioritize payment
toward the court's sanctions order over my personal
financial security.” No supporting documentation of
these statements has been provided by Mr. Mumford.
argues that Mr. Mumford should be ordered to show cause why
he should not be held in contempt for failing to immediately
pay the sanctions amount in full. Standard argues that Mr.
Mumford is in “clear violation of the Court's March
17 Order” and that “there is no excuse or
justification for Mr. Mumford's conduct, which conduct is
in open and flagrant disregard of the Court's mandate to
‘immediately' pay the Sanctions Amount to
Standard.”Standard explains that rather than pay
the sanctions amount as ordered, “Mr. Mumford contacted
seventeen (17) attorneys at Kirton McConkie [the law firm
representing Standard] and told them they ‘didn't
stop [Standard's Rule 11 motion] when you should have -
and I would encourage you to go back and read the letter I
senton October 27, 2014, when I first tried to dissuade your
firm from taking this action.'” Standard
argues that Mr. Mumford should also be ordered to pay
Standard's counsel's additional fees associated with
enforcement of the sanctions orders.
Mumford disagrees with Standard, and argues that he should
not be held in contempt. He argues that the reason he has not
paid the sanctions amount is because he does not have the
ability to make an immediate payment of over $25,
000. He argues that the sanctions amount was
ordered in error and he intends to appeal the
decision. Mr. Mumford contends that
“additional attorney fees and expenses are not
appropriate because Standard incurred them
unnecessarily.” Mr. Mumford states that he has
“tried repeatedly to work out a payment plan with
Standard because I simply do not have the full amount,
despite my best efforts” but “Standard has
continually refused.” Mr. Mumford states that he has
sent two checks to Standard totaling $5, 000, but Standard
has refused to cash the checks.
Standard for Contempt
Mumford to be held in contempt, Standard must prove, by clear
and convincing evidence, “that a valid court order
existed, that [Mr. Mumford] had knowledge of the order, and
that [Mr. Mumford] disobeyed the Order.” “A
district court may exercise broad discretion in using its
contempt power to assure compliance with its
orders.” “Abuse of discretion is
established if the district court's adjudication of the
contempt proceedings is based upon an error of law or a
clearly erroneous finding of fact.”
Mumford Is in Contempt for His Ongoing Failure to Pay ...