JOHN F. LAWRENCE, Plaintiff-Appellant, BRIAN P. DANIELS, ESQ., RUTH ANN AZEREDO, ESQ., Appellants, v. RICHMAN GROUP OF CT LLC, USA INST TAX CREDIT FUND XXXVI, USA INST TAX CREDIT FUND XXXVIII, Defendants-Appellees, RICHMAN GROUP CAPITAL CORP., RICHMAN GROUP, INC., RICHMAN ASSET MGMT, LLC, RICHMAN GROUP OF NY LLC, RICHMAN GROUP MGMT CORP, USA INSTITUTIONAL TAX CREDIT FUND XXVII LP, RICHMAN USA TAX CREDIT XXV II LP, RICHMAN USA TAX CREDIT XXV II, INC, USA INSTITUTIONAL TAX CREDIT FUND XXV III LP, RICHMAN USA TAX CREDIT XXV III LP, RICHMAN USA TAX CREDIT XXVIII, INC, USA INSTITUTIONAL TAX CREDIT FUND XXX LP, RICHMAN USA TAX CREDIT XXX LLC, USA INSTITUTIONAL TAX CREDIT FUND XXX II LP, RICHMAN USA TAX CREDIT XX XII LLC, RICHMAN FAMILY TRUST I, USA INSTITUTIONAL TAX CREDIT FUND XXXIV LP, RICHMAN USA TAX CREDIT XXXIV LLC, USA INSTITUTIONAL TAX CREDIT FUND XXXV LP, RICHMAN USA TAX CREDIT XXXV LLC, RICHMAN USA MGR, INC, USA/FLEET INST TAX CREDIT FUND XX-A LP, USA INSTITUTIONAL TAX CREDIT FUND XX-C LP, RICHMAN USA TAX CREDIT XX LP, RICHMAN USA TAX CREDIT XX, INC, Consolidated-Defendants-Appellees., 620 F.3d 153
Summary
The court held that where a district court had dismissed a prior complaint without awarding Fed. R. Civ. P. 11 sanctions and granted a party leave to replead, the filing of the new pleading reset the clock for seeking sanctions pursuant to Fed. R. Civ. P. 11(c)(2), so that the filer had to be afforded 21 days to correct or withdraw the pleading before a motion for sanctions was presented to the district court. Defendants' initial sanctions motion, filed with respect to the first amended complaint, afforded plaintiff the 21-day safe harbor mandated by Fed. R. Civ. P. 11(b)(2), and defendants' renewed Fed. R. Civ. P. 11 motion was served only after the initial motion had been denied, the first amended complaint dismissed, and plaintiff's second amended complaint found inadequate to warrant reconsideration of the order of dismissal. Because defendant was not afforded any notice of defect with respect to the second amended complaint, much less 21 days to correct or withdraw that filing ...