United States District Court, W.D. Washington, Seattle
ROBERT E. CARUSO and SANDRA L. FERGUSON, Plaintiffs,
WASHINGTON STATE BAR ASSOCIATION, et al., Defendants.
ORDER GRANTING MOTION TO DISMISS
RICARDO S. MARTINEZ CHIEF UNITED STATES DISTRICT JUDGE.
matter comes before the Court on Defendants' Motion for
Attorneys' Fees and Expenses. Dkt. #22. Defendants seek
sanctions against Plaintiffs' counsel, Stephen K.
Eugster. Id. Mr. Eugster opposes this Motion on his
own behalf. Dkt. #23. For the reasons stated below, the Court
GRANTS Defendants' Motion.
to filing this case, Plantiffs' counsel Mr. Eugster has
filed several lawsuits on his own behalf against the WSBA
addressing the constitutionality of mandatory bar membership
and fees and the validity of the WSBA's discipline
system. See Eugster v. Wash. State Bar Ass'n,
No. CV 09-357-SMM, 2010 WL 2926237 (E.D. Wash. July 23, 2010)
(“Eugster II”) (discipline system); Eugster
v. Wash. State Bar Ass'n, No. C15-0375JLR, 2015 WL
5175722 (W.D. Wash. Sept. 3, 2015) (“Eugster
III”) (membership/fees), aff'd, No.
15-35743, Dkt. #18-1 (9th Cir. Mar. 21, 2017); Eugster v.
Wash. State Bar Ass'n, No. 15204514-9 (Spok. Cnty.
Super. Ct. 2015) (“Eugster IV”) (discipline
system); Eugster v. Littlewood, No.
2:15-CV-0352-TOR, 2016 WL 3632711 (E.D. Wash. June 29, 2016)
(“Eugster V”) (discipline system); Eugster v.
Wash. State Bar Ass'n, No. 2:16-cv-01765 (W.D. Wash.
2016) (“Eugster VI”) (membership/fees and
discipline system). Each of these lawsuits was dismissed at
the pleadings stage. See Dkt. # 16 at 2-7
(Defendants' Motion to Dismiss summarizing the outcome of
case was filed on January 3, 2017, initially as a putative
class action on behalf of all WSBA members, naming Plaintiffs
Robert E. Caruso and Sandra L. Ferguson as class
representatives. See Id. at 11. On February 21,
2017, Plaintiffs amended their Complaint to abandon all class
claims. See Dkt. # 4. Plaintiffs' Amended
Complaint described Defendants as: (1) “Washington
State Bar Association 1933, ” an entity Plaintiffs
alleged was “the Washington State Bar Association
created by the State Bar Act, Wash. Sess. ch. 94, 1933 and
prior to the amendments made to its Bylaws by the WSBA 1933
Board of Governors the afternoon of September 30,
2016;” (2) “Washington State Bar Association
2017, ” an entity Plaintiffs alleged was “the
Washington State Bar Association created by amendments made
to Bylaws of the WSBA 1933 by the WSBA 1933 Board of
Governors on September 30, 2016;” and (3-21) various
WSBA officials. Id. at 1-3.
First Cause of Action was for declaratory judgment and
sought, in part, an injunction “enjoining Defendants
from compelling Plaintiffs to be a members (sic) of the WSBA
2017 and from compelling Plaintiffs to pay dues to the WSBA
2017.” Id. at 32. Plaintiffs' Second Cause
of Action was brought under 42 U.S.C. § 1983 for
violation of the First and Fourteenth Amendments to the U.S.
Constitution for being “compelled to be a members (sic)
of WSBA 1933 or WSBA 2017.” Id.
Plaintiffs' Third Cause of Action was similarly brought
under the First and Fourteenth Amendments as
“[c]ompulsory dues violate Plaintiffs' right of
freedom of speech, including the freedom not to speak and to
not be forced to finance speech…” Id.
at 33. Plaintiffs' Fourth Cause of Action was titled
“WSBA Disciple System No Longer Exists.”
Id. at 34-35. Plaintiffs' Fifth Cause of Action
alleged that the WSBA discipline system violates
constitutional due process. Id. at 35.
Plaintiffs' Sixth Cause of Action alleges that the WSBA
discipline system deprives Plaintiffs' rights
“under the doctrine of constitutional scrutiny.”
Id. at 36. Plaintiffs' Prayer for Relief
essentially requested the Court declare that Plaintiffs,
attorneys licensed to practice law in the State of
Washington, do not have to be members of the WSBA, do not
have to pay WSBA dues, and are not subject to WSBA
discipline. Id. at 38-39.
March 1, 2017, Plaintiffs filed a Motion for Summary
Judgment. Dkt. # 8. On March 3, 2017, Plaintiffs also filed a
Motion for Preliminary Injunction, making similar arguments.
See Dkt. # 15. On March 21, 2017, Defendants filed a
Motion to Dismiss, and followed that up with the instant
Motion for Attorney Fees on April 27, 2017. Dkts. #16 and
11, 2017, the Court granted Defendants' Motion and
dismissed all of Plaintiffs' claims with prejudice. Dkt.
#28. In that Order, the Court disagreed with Plaintiffs'
argument that the WSBA was reborn as a new entity on
September 30, 2016, finding that “Plaintiffs offer no
argument against Defendants' reasoned analysis, above,
and the Court cannot imagine any valid argument.”
Id. at 5. The Court found that Plaintiffs'
counsel had previously raised the claims that bar membership
and dues were unconstitutional and “been sharply
rebuked by the Honorable James L. Robart for
‘mischaracterization of case law' and making
‘nonsensical' arguments. Id. at 6 (citing
Eugster v. Washington State Bar Ass'n, No.
C15-0375JLR, 2015 WL 5175722, at *5-6 (W.D. Wash. Sept. 3,
2015), aff'd, No. 15-35743, 2017 WL 1055620 (9th
Cir. Mar. 21, 2017). The Court was able to dismiss all of
Plaintiffs' claims based on these arguments without
further analysis. See id. As to Plaintiffs'
remaining claims that Defendants' actions violated
procedural due process and constitutional scrutiny, the Court
found that “Plaintiffs' due process and
constitutional scrutiny claims fail under the law cited by
Defendants, ” that “Plaintiffs make no effort to
argue otherwise, ” and that instead Plaintiffs devoted
“nearly all of their brief to addressing tangential
issues raised by Defendants.” Id. at 8. The
Court found that dismissal with prejudice was warranted
because “Plaintiffs have given the Court no reason to
believe they are capable of alleging facts sufficient under
the law, given that Plaintiffs have previously amended their
Complaint and given their counsel's familiarity with the
law surrounding this issue.” Id.
subsequently appealed the Court's Order of Dismissal and
associated judgment. Dkt. #30. That appeal is pending.
instant Motion seeks sanctions on three grounds: Rule 11, 28
U.S.C. § 1927, and the Court's inherent power. The
Ninth Circuit Court of Appeals has set forth the
considerations for Rule 11 sanctions:
An attorney is subject to Rule 11 sanctions, among other
reasons, when he presents to the court “claims,
defenses, and other legal contentions . . . [not] warranted
by existing law or by a nonfrivolous argument for the
extension, modification, or reversal of existing law or the
establishment of new law[.]” Fed.R.Civ.P. 11(b)(2).
When, as here, a “complaint is the primary focus of
Rule 11 proceedings, a district court must conduct a
two-prong inquiry to determine (1) whether the complaint is
legally or factually baseless from an objective perspective,
and (2) if the attorney has conducted a reasonable and
competent inquiry before signing and filing it.”
Christian v. Mattel, Inc., 286 F.3d 1118, 1127 (9th
Cir. 2002) (internal quotations and citation omitted). As
shorthand for this test, we use the word