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Legal Memorandum: Sanctions for Bad Faith Litigation in VI

Issue: Under the law of the Virgin Islands, what sanctions are available for bad faith litigation?

Area of Law: Ethics & Professional Responsibility, Litigation & Procedure
Keywords: Bad faith litigation; Sanction
Jurisdiction: Federal, Virgin Islands
Cited Cases: 690 A.2d 299; 120 F.3d 368
Cited Statutes: None
Date: 05/01/2004

Relevant law authorizes monetary sanctions. For example, in the case of In re Tutu Wells Contamination Litig., 120 F.3d 368 (3d Cir. 1997) (overruled by implication on other grounds), the court found that “it is beyond dispute that attorney’s fees are, in certain circumstances, properly awarded as a sanction.”  120 F.3d at 387.  Also, the court elaborated that it was not aware of any precedent in the Third Circuit that categorically excludes from such an award attorney’s fees arising from the sanctions proceedings themselves and it further states that it did not “believe such a categorical exclusion is wise.”  Id. at 387-88.

The time, effort, and resources expended in bringing sanctionable conduct to light would have been unnecessary had the sanctionable conduct never occurred. These costs are as much a harm to a party in the litigation as is the delay in the litigation or the substantive prejudice caused by the conduct. If we exclude from a possible award the costs of sanctions proceedings, we would undermine the compensatory goal of a sanctions award.

 

Further, if a party is aware ex ante that the costs he incurs in exposing sanctionable conduct will never be recouped, that party may decide to forgo a sanctions proceeding altogether. In doing so, however, that party might allow otherwise sanctionable conduct to go unaddressed. In such cases, the deterrent goal of a sanction award has been lost; parties who know that the likelihood […]

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