USACM Liquidating Trust v. Winthrop Couchot Professional Corp. (In Re USA Commercial Mortgage Co.)

MEMORANDUM

Winthrop Couchot Professional Corporation (Winthrop), former counsel for Anthony and Susan K. Monaco (collectively, the Monacos), appeals the district court’s imposition of discovery sanctions arising from the chapter 11 bankruptcy of USA Commercial Mortgage Corporation (USACM). USACM Liquidating Trust (the Trust), the transferee of USACM’s assets, filed the underlying adversary proceeding against the Monacos alleging, inter alia, unjust enrichment.

1. We review de novo the legal question whether the district court possessed the power to sanction Winthrop. See Unigard Sec. Ins. Co. v. Lakewood Eng’g & Mfg. Corp., 982 F.2d 363 , 367 (9th Cir.1992) (Unigard). “If the power existed, the district court’s exercise of that power will only be reversed for an abuse of discretion. Underlying findings of fact are reviewed for clear error.” Id. (citation omitted).

The district court possessed the power to sanction Winthrop pursuant to its inherent authority “to manage [its] own affairs so as to achieve the orderly and expeditious disposition of cases.” Id. at 368 (citation omitted). The Trust’s motion for sanctions asserted that the imposition of sanctions against Winthrop and…