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Dismissal for Inability to Pay Monetary Sanctions Reversed

The Seventh Circuit Court of Appeals reversed the dismissal for failure to pay a $9,055.14 attorney fee sanction against an indigent Plaintiff.

Bruce A. Williams brought federal suit against four Illinois police officers for false arrest and excessive force. He alleged that Defendants assaulted him, causing facial scarring, which ended his work as a cosmetologist/educator. Williams was allowed to proceed in forma pauperis.

After claims against two Defendants were allowed to proceed to trial, defense counsel sent Williams a draft pretrial order. He retained attorney Garry Alonzo Payton, to respond to the order.

Despite Defendants' numerous attempts to reach Payton, he failed to respond to the draft order, nearly six months after his appearance and expiration of the pretrial order deadline. Defendants moved for dismissal or reimbursement of their attorney fees as sanctions under FRCP 16(f).

Payton responded, the parties filed a joint pretrial order and defendants withdrew their request for dismissal. They continued, however, to seek their expenses.

The district court granted Defendants' motion, finding Williams and Payton jointly liable for $9,055.14 due to Payton's lack of cooperation. The court ordered full payment within 30 days.

Payton withdrew and Defendants refused Williams's request to pay $25 a month, due to his indigency. Five months after the payment deadline expired, Defendants moved to dismiss under FRCP 41(b), for violation of the payment order.

The district court dismissed, finding that "the failure to pay had been ‘contumacious,' despite plaintiff's inability to pay $9,055.14 or any significant part of it." "From the standpoint of compliance with the district court's order," the Seventh Circuit found that Williams's "offer to pay off the sanctions debt at a rate of $25 a month, though it may well have been the best offer he could make given his financial situation, was "laughable". “It would have taken him more than 30 years to complete payment. He was given 30 days; he sought 11,000." Even so, the court found that his failure to pay was not "contumacious."

Noting that the case illustrates why ignoring "a party's inability to pay a sanction could result in a disproportionate punishment," the court observed that had the case been allowed to proceed to trial, Williams "might well have obtained a judgment for significantly more than the amount he owed" as evidenced by the fact that Defendants offered to settle for $10,000, minus the $9,055.14. Therefore, "dismissal was too severe a sanction."

More importantly, Williams successfully pursued a complaint against Payton with the Illinois Attorney Registration and Disciplinary Commission (ARDC). Payton was found "entirely responsible" and the Illinois Supreme Court "ordered Payton to pay the entire $9,055.14 . . . and suspended him from practicing law for 45 days."

Defendants neglected to mention in their briefing that Payton had paid the debt in full. "With the defendants fully compensated," the court found that "the dismissal of the plaintiff's . . . suit when his own conduct has been blameless has become an unreasonable sanction." Williams "actually saved the defendants additional expense by complaining to the ARDC, for otherwise they would have had to do so, or sue Payton to obtain payment." See: Williams v. Adams, 660 F.3d 263 (7th Cir. 2011).

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Related legal case

Williams v. Adams