Submitted: January 9, 2018
Appeals from United States District Court for the Eastern
District of Missouri - St. Louis
WOLLMAN, COLLOTON, and BENTON, Circuit Judges.
BENTON, Circuit Judge.
bankruptcy court sanctioned Ross H. Briggs for contempt of
an order and for misleading the court. The district
court affirmed. Having jurisdiction under 28
U.S.C. §§ 158(d)(1) and 1291, this court affirms.
Services LLC was a bankruptcy-services business run by
Beverly Holmes Diltz. Working with Critique were attorneys
Briggs and James C. Robinson. In June 2014, the bankruptcy
court suspended Robinson from practicing in the United States
Bankruptcy Court for the Eastern District of Missouri. This
court affirmed. Robinson v. Steward (In re Steward),
828 F.3d 672 (8th Cir. 2016).
agreed to represent about 100 of Robinson's clients who
had bankruptcy cases pending in the Eastern District. In late
2014, the bankruptcy court ordered Robinson to show cause why
it should not order disgorgement of his attorney's fees
in some of those cases. The bankruptcy court also ordered the
trustees in these cases to provide the court with specific
information about the fees.
comply with the order, the trustees sent a letter to
Critique, Robinson, and Briggs asking for documents and
information. Briggs responded: "all of my legal services
rendered on behalf of the debtors in question were afforded
free of charge and no fee was paid to or shared with me in
these cases. Accordingly, there are no checks, ledgers or
account statements that relate to such non-existent
fees." He added: "I . . . do not possess any
document of [Critique]" or "any documents which are
encompassed within [the trustees'] request to Mr.
trustees moved to compel Critique, Robinson, and Briggs to
turn over the requested documents and information. On January
13, 2015, the bankruptcy court held a hearing on the motion.
Arguing about the motion, Briggs discussed his relationship
with Critique and Diltz, eventually agreeing to help obtain
the documents and information. On January 23, the bankruptcy
court ordered Critique, Robinson, and Briggs to turn over to
the trustees specific fee-related documents and information.
The bankruptcy court noted that to comply with the order,
Briggs might need to seek the documents and information from
third parties or "mak[e] inquiries" with Critique
6, the bankruptcy court issued an order finding that
Critique, Robinson, and Briggs "had failed to comply
with the Order Compelling Turnover." The bankruptcy
court explained that it was "considering the imposition
of monetary sanctions and/or nonmonetary sanctions or the
taking of any other appropriate action for
non-compliance." The order gave Critique, Robinson, and
Briggs seven days to either comply with the order compelling
turnover or file a brief addressing why sanctions should not
be imposed. Briggs filed a brief opposing sanctions. On July
22, the bankruptcy court ordered Briggs to show cause why he
should not be sanctioned. Briggs responded by questioning the
bankruptcy court's authority, also arguing that sanctions
were not warranted.
April 20, 2016, the bankruptcy court sanctioned Briggs. It
reviewed at length the disciplinary records of several people
associated with Critique, including Briggs. See Briggs.
v. Labarge (In re Phillips), 433 F.3d 1068, 1071 (8th
Cir. 2006) (holding Briggs violated Fed.R.Bankr.P. 9011, but
vacating sanctions); In re Wigfall, No. 02-32059,
slip op. at 2 (Bankr. S.D. Ill. August 15, 2002) (suspending
Briggs "from filing any new cases in the United States
Bankruptcy Court for the Southern District of Illinois for a
period of three (3) months.") It found "Briggs to
be in contempt of the Order Compelling Turnover, " and
that he "deliberately and with deceptive intent made
misleading representations to the Court regarding the true
nature of his relationship with the Critique Services
Business and Diltz." With some exceptions, the order
banned Briggs for six months from representing new bankruptcy
clients, practicing before U.S. Bankruptcy Court for the
Eastern District of Missouri, and using that court's
electronic-filing system. It also required him to take 12
hours of continuing legal education in professional ethics,
and permanently prohibited him "from being financially
or professionally involved with or connected to, whether
formally or informally or otherwise, " Critique, Diltz,
Robinson, and other individuals and entities affiliated with
appeals. While the appeal was pending, Briggs requested
reinstatement to practice before the United States Bankruptcy
Court for the Eastern District of Missouri. He directed his
request first to the chief bankruptcy judge, then to the
chief district judge. Both ruled that Briggs's request
was improper. Briggs also appeals the chief district
says that as an Article I court, the bankruptcy court did not
have constitutional authority to sanction him under these
circumstances. This is a legal issue that this court reviews
de novo. See Walton v. LaBarge (In re Clark), 223
F.3d 859, 862, 864 (8th Cir. 2000).
focuses on Stern v. Marshall, 564 U.S. 462 (2011).
There, the bankruptcy court, in an adversary proceeding,
entered summary judgment on a counterclaim for tortious
interference. Stern, 564 U.S. at 470-71. The Court
explained that the bankruptcy court had statutory authority
to enter final judgment on the counterclaim under 28 U.S.C.
§ 157(b)(2)(C). Id. at 482. As to statute's
constitutionality, the Court said: "When a suit is made
of 'the stuff of the traditional actions at common law
tried by the courts at Westminster in 1789, ' and is
brought within the bounds of federal jurisdiction, the
responsibility for deciding that suit rests with Article III
judges in Article III courts." Id. at 484,
quoting Northern Pipeline Constr. Co. v. Marathon Pipe
Line Co., 458 U.S. 50, 90 (1982) (Rehnquist, J.,
concurring in judgment).
Stern counterclaim met that standard-and could only
be heard by an Article III court-because it involved
"the most prototypical exercise of judicial power: the
entry of a final, binding judgment by a court with
broad substantive jurisdiction, on a common law cause of
action, when the action neither derives from nor
depends upon any agency regulatory regime."
Id. at 494 (emphasis added on last two phrases).
Even if a counterclaim is statutorily authorized,
"Congress may not bypass Article III simply because a
proceeding may have some bearing on a bankruptcy
case; the question is whether the action at issue stems from
the bankruptcy itself or would necessarily be resolved in the
claims allowance process." Id. at 499. The
Court concluded that the bankruptcy court "lacked ...