Jon Deutsch v. Annis Enterprises, Inc.

Citation: 882 F.3d 169Docket: 17-50231

Court: Court of Appeals for the Fifth Circuit; February 7, 2018; Federal Appellate Court

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Jon R. Deutsch, a paraplegic, appeals the dismissal of his claims against Annis Enterprises, Inc. under the Americans with Disabilities Act (ADA) for lack of Article III standing, as well as a contempt order against his attorney and an attorney's fee award to Annis. Deutsch alleges he faced difficulties accessing Color at Dawn, a salon on Annis's property, due to inadequate ADA-compliant parking and access features. He filed this lawsuit as part of a broader pattern, having submitted 385 ADA lawsuits in 306 days. The district court's magistrate judge (MJ) ordered an evidentiary hearing on standing, requiring Deutsch’s presence, which he did not attend due to his attorney's misunderstanding of court notifications. The MJ subsequently held a contempt hearing for the attorney, Omar Rosales, who was fined $2,500 for failing to ensure Deutsch's attendance. Ultimately, the court affirmed the dismissal and contempt order, concluding that Deutsch's complaint did not sufficiently establish standing.

Deutsch visited Color at Dawn for hair coloring for his wife but did not exit his vehicle, concluding he could not enter the business. He has not returned since that visit. During questioning, it was revealed that Deutsch collaborates with Rosales on property listings, which the magistrate judge (MJ) determined were largely prepared by Rosales. Deutsch could not identify any business he had sued and then patronized post-settlement. The MJ recommended dismissal for lack of standing under Rule 12(b)(1), stating Deutsch failed to demonstrate an "actual or imminent injury" or "concrete plans" to return to the businesses, thus lacking standing.

The district court upheld the MJ’s recommendations, dismissing Rosales’s contempt objection. Deutsch appealed, and the appellate court reviews the dismissal de novo, considering factual disputes for clear error. The court noted that Deutsch did not establish Article III standing as he failed to show any ADA violations presented a threat of future injury. Deutsch incorrectly claimed the MJ could not hold an evidentiary hearing, but the court clarified that under Rule 12(b)(1), the district court can dismiss based on the complaint alone or supplemented by undisputed facts.

To establish standing, Deutsch must demonstrate (1) an "injury in fact" that is concrete and imminent; (2) a causal link between the injury and the alleged conduct; and (3) that a favorable ruling would likely redress the injury. For equitable relief, he must show a real and immediate threat of repeated injury; past injuries alone are insufficient. Under the ADA, Deutsch seeks injunctive relief, which necessitates meeting these standing criteria. The court referenced Frame v. City of Arlington, where plaintiffs established standing by detailing how ADA violations concretely affected their lives. However, Deutsch failed to demonstrate how the alleged violations at Color at Dawn would negatively impact his daily activities.

Deutsch's legal standing for equitable relief is undermined by his lack of demonstrated intent to return to the establishment in question, having only visited it once. The district court highlighted the absence of evidence indicating Deutsch would suffer future injury related to Annis's alleged ADA violation, especially in light of his filing of approximately 400 lawsuits within a year without recalling any establishment he subsequently revisited. Regarding the magistrate judge's (MJ) contempt order, the district court properly considered and overruled Deutsch's objections, establishing jurisdiction for appeal. The prevailing view is that a magistrate cannot adjudicate contempt but can only certify facts of possible contempt to the district court. The MJ's contempt order stemmed from 28 U.S.C. 636(e), meaning the district court's ruling on Deutsch's objections sufficed for appellate review.

Deutsch argues that the contempt order was erroneous for three reasons: (1) Rosales lacked bad faith, (2) Rosales was denied due process, and (3) the fine imposed was not the least restrictive. Each argument is dismissed. The court found that Rosales's failure to comply with the MJ's clear order, which required Deutsch's presence for hearings on standing issues, indicated potential bad faith. The court expects heightened conduct from attorneys, and Rosales's misunderstanding of the order did not excuse his actions. Furthermore, Rosales received adequate due process, as the contempt occurred in the judge's presence, which requires only notice and a hearing. Thus, the district court acted within its discretion in imposing sanctions on Rosales for obstructing justice.

Rosales did not bring Deutsch to the initial hearing or instruct his presence, prompting the magistrate judge (MJ) to warn him about setting a show cause hearing. A written order was issued detailing the conduct under review, leading to a hearing where Rosales could explain himself and discuss the sanction. He filed a written objection to the district court, which was denied, ensuring he received due process. While courts typically impose the least severe sanction necessary, a precedent case (Carroll) upheld a $7,000 sanction for serious misconduct including challenging and insulting behavior during a deposition. The court noted that Rosales, as an attorney, was expected to understand the implications of his actions, which delayed proceedings and burdened others. Although this was Rosales's first offense, the sanction was deemed appropriate as it was less severe than in Carroll, indicating no abuse of discretion by the district court. Lastly, Deutsch's claim regarding the wrongful award of attorney’s fees was dismissed as the district court only awarded costs of court to Annis and Travis County Shoe Hospital. The decision was affirmed.