Court Error – Sanctions

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WI Court of Appeals – District I

Case Name: Jackson Fairbanks Veit v. Angela Frater

Case No.: 2018AP442

Officials: Kessler, P.J., Brennan and Kloppenburg, JJ.

Focus: Court Error – Sanctions

Attorney Leah Poulous Mueller appeals an order of the trial court imposing on her a monetary sanction of $5,923.50 for “maintaining” frivolous proceedings for the improper purpose of harassing the defendants[.]” She also appeals the trial court’s order denying her reconsideration motion. Attorney Mueller served as plaintiff’s counsel in this case, which sought damages on the grounds that plaintiff had been wrongfully deprived of his investment in InfoCorp, LLC (“InfoCorp”) when it became insolvent and its assets were sold to a new company. This case was commenced in 2016, four years after the plaintiff’s prior lawsuit in Washington County Circuit Court concerning the same asset sale was dismissed and was not appealed. Attorney Mueller was also plaintiff’s counsel in the Washington County case. This case was dismissed on the grounds that it was barred by claim preclusion. The trial court imposed sanctions on Attorney Mueller because it concluded that “[g]iven the law on claim preclusion, plaintiff’s counsel [Mueller] should have known that [plaintiff’s] claims in this case were without merit.” Attorney Mueller asks this court to vacate the orders.

Attorney Mueller asserts that the sanctions were improperly imposed for the following reasons. First, she argues that the defendant’s motion was defective because (1) it impermissibly sought both monetary and nonmonetary sanctions and thus should have been brought as separate motions; (2) it did not identify the specific conduct alleged to be frivolous; (3) it did not provide her the required twenty-one-day safe harbor notice; and (4) it was untimely. Attorney Mueller also argues that the trial court erred in imposing the sanctions because (1) the elements for a claim of malicious prosecution were not present; (2) the underlying case did have a basis in law, and the trial court’s conclusion to the contrary was “a manifest error”; and (3) she was wrongly sanctioned on the basis of her client’s amended pro se complaint even though she had requested leave to amend the complaint again in order to cure the problems with it.

The record does not support Attorney Mueller’s assertions of fact, and her legal arguments are contrary to well-settled law. We conclude that the trial court examined the relevant facts, applied a proper standard of law, and reached a reasonable conclusion when it ordered the sanctions against Attorney Mueller, and we therefore affirm.

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Derek A Hawkins is trademark corporate counsel for Harley-Davidson. Hawkins oversees the prosecution and maintenance of the Harley-Davidson’s international trademark portfolio in emerging markets.