A few more thoughts regarding the Kraken crew, Sydney Powell, Lin Wood, et al.
I don't know what the sanction amount will be in the Michigan case. I don't have a sense of how much time was put in by the Defendants or how many briefs got filed. And they were represented by government lawyers I believe (but am not sure), whose hourly rates are different from those of private firms. I expect the number will be several hundred thousand dollars. We shall see. Suppose so. The lawyers are, as a group, sufficiently wealthy to pay that sort of sanction. Individually, it is a different matter. I expect that one or two would be ruined if faced with the total. And, in the end, it is up to the Defendants whom they collect from -- the award is joint and several. But just in case one is curious, the kind of sanctions imposed in this case are not dischargeable in bankruptcy. Under 11 U.S.C. §523(a)(6), a judgment based on an injury resulting from willful and malicious conduct is not dischargeable. Willful injury is "a deliberate or intentional injury, not merely a deliberate or intentional act that leads to injury." Kawaauhau, 523 U.S. at 61 (emphasis in original). An act is malicious under 523(a)(6) when the person acts in conscious disregard of their duties or without just cause or excuse. Malicious intent occurs when the actor desires to cause the consequences of his act, or believes that the consequences are substantially certain to result form it." In re Moore, 357 F.3d at 1129. Those standards are met. Judge Parker's order clearly and explicitly attributes to each lawyer individually bad faith conduct. That is, each is found to have acted in conscious disregard of their duties (as lawyers) and of the rights of Defendants. Their conduct aimed at imposing costs on Defendants, not vindication of any cognizable rights of Plaintiffs: "And this case was never about fraud--it was about undermining the People's faith in our democracy and debasing the judicial process to do so." (3) A point supported by the failures to correct errors or to withdraw papers that are either moot or unfounded, itself grounds for sanctions.
What sort of defense might the attorneys have put on once the Court gave notice that it was considering sanctions? That is something I have pondered from time to time since listening to the July 12 2021 hearing. The defense that presented at the hearing (save for Newman and Rohl) was hard to credit. The argument was that these various 'witnesses' signed affidavits and some of the affidavits had been submitted to other (state) courts. Attorneys are entitled to rely on affidavits as reasonable investigation and attorneys themselves are entitled to be believed by the court. Finally, we can show that the affidavits are credible if, Judge, you will hold an evidentiary hearing so the 'witnesses' can be examined. But none of those arguments makes sense. The affidavits submitted to the state court had been found to be inaccurate and not credible. Anyway, how would the fact if filing make the affidavit credible, or remove the duty to investigate? More importantly, it would make no difference because the affidavits just do not support the allegations of the Complaint; whether true or false, the affidavits are irrelevant to the allegations of the Complaint. It is the Complaint that the lawyers are responsible for, and that is unsupported. It is just false that attorneys can step out from the duty of reasonable investigation by blind reliance on a party's or third party's assertions -- the assertions have to be plausible. These weren't. And attorneys are not entitled to credibility or plausibility merely because they are the source of some allegation. As to the evidentiary hearing line, well, it would serve no purpose. The affidavits are irrelevant. Having witnesses repeat the statements cannot change that. As the Plaintiffs' lawyers knew what the Judge was concerned about before the hearing, namely the basis for and investigation of the allegations of the Complaint and Amended Complaint, the lawyers' arguments seem to be so bad as to invite sanctions. (I was a little surprised that the Judge did not impose further sanctions for such bad arguments.) All I have come up with that they might have accepted fault for the conduct and requested leniency. Which is not a defense, I know.
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