Business Guides, Inc. v. Chromatic Communications Enterprises, Inc.

PETITIONER: Business Guides, Inc.
RESPONDENT: Chromatic Communications Enterprises, Inc.
LOCATION: District Court for the Middle District of Florida, Jacksonville Division

DOCKET NO.: 89-1500
DECIDED BY: Rehnquist Court (1990-1991)
LOWER COURT: United States Court of Appeals for the Ninth Circuit

CITATION: 498 US 533 (1991)
ARGUED: Nov 26, 1990
DECIDED: Feb 26, 1991

ADVOCATES:
Neil L. Shapiro - on behalf of the Respondents
Stephen V. Bomse - on behalf of the Petitioner

Facts of the case

Question

Media for Business Guides, Inc. v. Chromatic Communications Enterprises, Inc.

Audio Transcription for Oral Argument - November 26, 1990 in Business Guides, Inc. v. Chromatic Communications Enterprises, Inc.

Audio Transcription for Opinion Announcement - February 26, 1991 in Business Guides, Inc. v. Chromatic Communications Enterprises, Inc.

William H. Rehnquist:

The opinion of the Court in No. 89-1500, Business Guides versus Chromatic Communications Enterprises will be announced by Justice O’Connor.

Sandra Day O'Connor:

This case comes to us on certiorari to the Court of Appeals for the Ninth Circuit.

The question presented is whether Rule 11 of the Federal Rules of Civil Procedure, which allows a judge to impose sanctions when signed documents are filed that had no basis in law or fact, imposes an objective standard of reasonable inquiry on a represented party who signed such a document.

We hold that it does.

The petitioner, Business Guides, filed a copyright infringement action in Federal Court against the respondent, Chromatic Communications.

Representatives of the plaintiff company signed the complaint and a supporting affidavit.

The District Court learned that the law suit had absolutely no basis in fact, sighting the seriousness of Business Guides’ improper conduct.

The court invoked Rule 11 and imposed monetary sanctions of the amount that the defendant had spent defending the suit.

Business Guides appealed claiming that Rule 11 applies to attorneys, not to represented parties.

The Court of Appeals affirmed.

We agree with the Court of Appeals.

The purpose of Rule 11 is to curve abuses of the judicial system.

It does this by imposing a certification requirement.

A pleading, or other paper filed with the court must bear the signature of an attorney or a party.

And that signature certifies that the signer has conducted a reasonable inquiry to ensure that the document is well-grounded in the facts and the law.

The text of Rule 11 makes clear that it applies equally the signatures of attorneys and of parties.

We hold that a represented party, who signs a pleading motion or other paper, has an affirmative duty to conduct a reasonable inquiry into the facts and the law, and the standard is one of reasonableness under the circumstances.

The judgment of the Court of Appeals is affirmed.

Justice Kennedy has filed a dissenting opinion which Justices Marshall and Stevens have joined and as to parts one, three, and four which Justice Scalia has joined.