In Re Itel Securities Litigation. I. Walton Bader, and Bader and Bader v. Itel Corporation, and Class

This is an appeal from an award of sanctions imposed by the district court following settlement of a massive class action against the Itel Corporation. Attorney I. Walton Bader challenges an order of the district court awarding sanctions in the amount of $10,000 to counsel for class plaintiffs and $5000 to counsel for Itel Corporation, said sanctions to be paid by Bader personally. The facts underlying the award of sanctions are set out in detail in the Opinion and Order of the district court. In re Itel Securities Litigation, 596 F.Supp. 226 (N.D.Cal.1984).

The district court found, inter alia, (1) that Bader’s conduct during the course of the litigation “constitute[d] bad faith,” and (2) that Bader “repeatedly took actions in the Itel Securities Litigation for the sole purpose of obtaining fee-related concessions in connection with other litigation.” Accordingly, the court awarded sanctions against Bader pursuant to (1) its “inherent power to award attorneys’ fees as a means of protecting the integrity of the judicial process,” (2) Fed.R.Civ.P. 11, and (3) 28 U.S.C. § 1927 . We review whether the award is justified under any of these theories.

The order appealed from finally…