As a young attorney in Denver with 17 clients whose homes were destroyed by fire, it’s nearly impossible not to find some way to evoke enough sympathy from the court to make it past a motion to dismiss. Josue Hernandez found a way, suing 113 defendants for 23 causes of action, beginning with five sounding in RICO.*
Rule 8 requires that Plaintiffs’ complaint provide “a short and plain statement of the claim showing that the pleader is entitled to relief,” with allegations that are “simple, concise, and direct.” Fed. R. Civ. P. 8(a)(2), (d)(1). I find that Plaintiffs’ 260 page, 1,363 paragraph Third Amended Complaint fails to meet this standard.
In the first place, the sheer length of Plaintiffs’ complaint (260 pages and 1,363 numbered paragraphs) suggests that Plaintiffs have failed to comply with Rule 8.
One might wonder whether such a long complaint was necessary due to the number of parties, the complexity of the issues, the demands of Iqbal. Senior District Judge John Kane explains that wasn’t the problem. For all its length, it failed miserably to do its job. And had it ended there, perhaps Hernandez might have walked away with only a loss to his name. But he wasn’t done with this case.
It continued with his relentless submission of inappropriate filings, as detailed throughout this Order, including the following.
● The complaint was amended two additional times after August 19, 2014 (ECF Nos. 339, 380). The final complaint was filed just nine days before Defendants’ motions to dismiss were due and was still 260 pages and 1,363 paragraphs.
● Mr. Hernandez filed a 40-page motion for extension of time to respond to the motions to dismiss (ECF No. 421) and a 47-page reply in support of that motion (ECF No. 429). I repeat that the motion was the lengthiest one I had ever seen or heard of and, to me, “illustrates a system gone mad.” 01/29/15 Trans. at 2:17-22.
● After I dismissed the case in its entirety, Mr. Hernandez filed Plaintiffs’ first motion for relief from the final judgment, which—with its exhibits and errata—totaled approximately 1,100 pages (ECF Nos. 481, 485-88). All of these filings were stricken (ECF No. 494).
What are the chances that a federal judge will be impressed with the diligence, the weight and heft of a lawyer’s efforts as reflected in (checks quote) a 40-page motion for an extention of time to respond? Shot, with a 1,100 page chaser.
The vexatiousness of the submissions generally was not in what they purported to be; it was in their substance and form. I have described them as prolix, meandering, full of unfounded supposition and speculation, repetitive and convoluted almost to the point of being maddening, etc. I need not say more. The notices and errata alone have required Defendants to turn circles and backflips.
Indeed, Judge Kane ran out of words to describe both how awful the work was and how pointlessly burdensome it was on the defendants and the court. It’s bad enough that this compelled the vast array of defendants, some of which could group themselves and others, being competitors, had to face this barrage independently, to read Hernandez’s tomes and respond, but required the judge to do so as well. This is not what makes wearing a robe fun.
Much as Hernandez’s actions on behalf of his clients may have been born of misguided zeal to hold the insurance industry accountable, if, indeed, it was wrong here, his way of going about it not only lost the case, but saddled them with the consequence of his excesses.
I am sensitive to the impact this Order will have both on Plaintiffs and Mr. Hernandez, and I do not issue it lightly. As Mr. Hernandez suggested at the March 2018 hearing, individuals’ health, families, and even dogs have been affected by this litigation. I cannot ignore, however, the obstinate pattern of behavior exhibited by Mr. Hernandez nor his and the plaintiffs’ complete disregard for the consequences of that behavior. This ship could have been abandoned at many points along the way, but it was not. Plaintiffs, with Mr. Hernandez at the helm, have forced Defendants, not just Joint Defendants, to expend enormous sums defending this action due to their senseless and ineffective pleadings and filings. The apparent aim of this litigation was to ensure fair business dealings by the insurance industry—unquestionably an honorable goal, but it has instead unjustifiably cost the industry millions of dollars, a burden that is likely to be passed on to the insureds it ostensibly sought to protect.
An “honorable goal” does not overcome an “obstinate pattern” of vexatious litigation. Not only will the plaintiffs be saddled with some portion of the $1,6 million in legal fees, at reduced rates and hours per the lodestar, but following the initial complaint, Judge Kane held Hernandez liable for the fees incurred as the product of his, rather than the plaintiff’s, choices.
“To excuse objectively unreasonable conduct by an attorney would be to state that one who acts ‘with an empty head and a pure heart is not responsible for the consequences.’” Braley, 832 F.2d at 1512 (quoting McCandless v. Great Atlantic and Pacific Tea Co., 697 F.2d 198, 200 (7th Cir. 1983)). I cannot permit such an outcome. Consequently, I conclude Mr. Hernandez is liable for fees under 28 U.S.C. § 1927 from August 19, 2014, forward. This finding is limited to fees incurred in defending the action at the district court level. Thus, if Joint Defendants continue to seek an award against Plaintiffs’ counsel personally, they must submit on or before February 6, 2019, the attorney fees—which I have found to be reasonable—they incurred after August 19, 2014, and related to district court proceedings only.
Clients tend to substitute the weight of papers for the competency of counsel. Many love huge pleadings, voluminous memos, even if they have no clue what they say, as they suggest a level of zeal and tenacity on the part of their lawyer. And lawyers, all too often, feed their clients’ mistaken understanding that quantity is a substitute for quality in law.
Whether Hernandez ever had a shot at his RICO claims making it past the motions to dismiss is a mystery, but the mandate of Rule 8 of the Federal Rules of Civil Procedure, “a short and plain statement of the claim” has a price tag for him and his clients. The price of prolix isn’t cheap. It’s about $1.6 million, on top of the loss of the plaintiffs’ homes. Plus the price of a stamp for Hernandez to send notice to his professional liability carrier. It might be more than one stamp if the letter is 40 pages.