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Wayne Watson Enterprises, LLC v. City of Cambridge

United States District Court, S.D. Ohio, Eastern Division

March 30, 2018

CITY OF CAMBRIDGE, et al., Defendants.

          Magistrate Judge Jolson

          OPINION & ORDER


         This matter is before the Court on the City of Cambridge's, et al. ("the City") Motion for Award of Attorney's Fees and Wayne Watson Enterprise's, LLC's, et al. ("Watson") Memorandum in Opposition to Defendants' Motion for Attorney's Fees, including a Cross Motion for Sanctions and Attorney's Fees. For the reasons set forth below, the City's Motion for Attorney's Fees (ECF No. 43) and Watson's Cross Motion for Sanctions and Attorney's Fees (ECF No. 44) are both DENIED.

         I. BACKGROUND

         The Court put forth a detailed factual background on this matter in its Opinion and Order filed on March 20, 2017 and incorporates those facts herein by reference. (ECF No. 39), In pertinent part, Watson filed suit in the Guernsey County Court of Common Pleas to challenge a City Ordinance that would approve construction of a shared drive between Wayne Watson's car wash and a Wendy's restaurant next door. Watson successfully obtained both a temporary restraining order and a preliminary injunction in state court and halted the implementation of the challenged ordinances and construction of the proposed shared drive. The case was removed to federal court in July of 2015. (ECF No. 1). In December, Watson filed an amended complaint, alleging claims under 42 U.S.C. § 1983 for procedural due process violations, substantive due process violations, void-for-vagueness infirmities in the challenged ordinances, the unlawful delegation of legislative power over municipal roads to the City Engineer, and alleged violations of state law and the City's municipal code regarding traffic construction. (ECF No. 16). Watson sought a permanent injunction barring the City from enforcing the challenged ordinances and prohibiting construction of the shared drive, among other damages. (Id.). On March 30, 2017, this Court granted summary judgment to the City on every claim, except for the state-law claims over which the Court declined to exercise jurisdiction. (ECF No. 39).

         After the Order, the City brought this Motion for Attorney's Fees, setting forth arguments under Rule 11, 28 U.S.C. § 1927, and 42 U.S.C. § 1988. (ECF No. 43). As the basis for its motion, the City alleges that settled law regarding property rights, access, and public rights-of way controlled the issues, but instead of applying the correct law and facts, Watson "misdirected their alleged theory to a 'generalized' right to do business." The City argues that Watson failed to "fairly and reasonably respond to admission requests." (Id.). The City further alleges that, because Watson did not fully evaluate or re-evaluate its alleged claims after the completion of depositions, attorney's fees and sanctions are warranted. (Id.).

         Watson responded with its Memorandum in Opposition, a filing that included a cross motion for Rule 11 sanctions. (ECF. No. 44). Watson alleges that the City's motion for fees and sanctions is baseless and requests its expenses and attorney's fees incurred in opposing it. (Id.).


         A. Rule 11 Sanctions

         Federal Rule of Civil Procedure 11 provides that "[a] motion for sanctions under this rule . . . shall not be filed with or presented to the court unless, within 21 days after service of die motion ... the challenged . . . claim ... is not withdrawn or appropriately corrected." Fed.R.Civ.P. 11(c)(1)(A). "The 1993 advisory committee notes clarify that given the 'safe harbor' provisions [of subsection (c)(1)(A)], a party cannot delay serving its Rule 11 motion until conclusion of the case . . . ." Morganroth & Morganroth v. DeLorean, 123 F.3d 374, 384 (6th Cir. 1997). If a motion for sanctions is not timely filed, the merits of a claim for sanctions need not be considered. Id.

         Federal Rule of Civil Procedure 11(b) provides, in relevant part, that when a pleading, written motion, or other paper is submitted, a party or counsel represents to the Court that:

(1) it is not being presented for any improper purpose, such as to harass or to cause unnecessary delay or needlessly increase in die cost of litigation;
(2) the claims, defense, and other legal contentions therein are warranted by existing law or by a nonfrivolous argument for the extension, modification, or reversal of existing law or the establishment of new law;
(3) the allegations and other factual contentions have evidentiary support or, if specifically so identified, are likely to have evidentiary support after a reasonable ...

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