Natalie C. Bolling

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLUMBIA
In re
NATALIE C. BOLLING,
Debtor.
)
)
)
)
)
)
Case No. 08-00746
(Chapter 13)
Not for Publication in
West’s Bankruptcy Reporter
MEMORANDUM DECISION RE MOTION FOR RECONSIDERATION OF ORDER
DATED JUNE 26, 2010, AND TO VACATE $500 JUDGMENT FOR CONTEMPT
The debtor's counsel, Keith J. Smith, has filed a motion
(Dkt. No. 80) titled Motion for Reconsideration of Order Dated
June 26, 2010, and to Vacate $500 Judgment for Contempt. 	Smith
seeks reconsideration of the court's order signed on June 26,
2010, that upheld a judgment for $500 imposed against him as the
amount of coercive civil contempt sanctions that would be treated
as having accrued against him starting in May 2009 for failing
timely to comply with an order requiring him to disgorge
attorney’s fees. 	Smith did not make the required disgorgement of
fees until April 23, 2010. 	The motion will be denied.
I
On January 21, 2009, the court entered an order directing
the debtor’s attorney, Smith, to disgorge fees to the clerk of
The document below is hereby signed.
Signed: July 25, 2010.
_____________________________
S. Martin Teel, Jr.
United States Bankruptcy Judge
Case 08-00746 Doc 81 Filed 07/26/10 Entered 07/26/10 11:10:33 Desc Main
Document Page 1 of 6

this court in the amount of $1,500 as reported on his Rule
2016(b) statement plus the amount of any other fees he has
received from the debtor in connection with this case after the
filing of that statement (Dkt. No. 33). 	The court denied Smith’s
multiple requests for reconsideration of that order, and on March
23, 2009, entered an order (signed on March 22, 2009) providing
that if Smith failed, by April 8, 2009, to purge himself of civil
contempt by complying with this court’s disgorgement order, Smith
would be subject to a coercive contempt fine of $10 per day until
he did comply (Dkt. No. 46). 	Although the court temporarily
stayed the disgorgement order and the $10 per day coercive fine,
the court issued an order (Dkt. No. 53) making clear that unless
Smith filed and the court granted a stay pending appeal, the stay
as to the disgorgement order and the accrual of the $10 per day
fine would be lifted effective May 5, 2009. 	Smith never filed a
motion for stay pending appeal, and there being no indication
that Smith complied with the court’s disgorgement order, on
January 4, 2010, the court entered an order directing Smith to
demonstrate that he had purged himself of contempt (Dkt. No. 66).
On January 15, 2010, Smith filed a motion (Dkt. No. 68) to
extend the deadline for complying with the court’s January 4,
2010 order, and the court granted that extension (Dkt. No. 69).
On March 16, 2010, Smith filed a motion to modify the
disgorgement order (Dkt. No. 70). 	In that motion, Smith sought
2
Case 08-00746 Doc 81 Filed 07/26/10 Entered 07/26/10 11:10:33 Desc Main
Document Page 2 of 6

to modify the terms of the disgorgement order to permit Smith to
make three separate installment payments totaling $1,500, with
the final payment due on June 29, 2010. 	The court granted the
motion to the extent it sought to establish new payment
deadlines. 	In the order (Dkt. No. 72) granting the motion,
however, the court was very specific that Smith was not relieved
of the coercive contempt sanctions that had already accrued.
Specifically, the court directed Smith to show cause as follows:
In addition, Smith must show cause why judgment
ought not be entered in favor of the U.S. (Payable to
the Clerk of Court) for the coercive contempt fine of
$10 per day that accrued for much of the time since
April 8, 2009 per the order signed March 22, 2009.
Without getting bogged down in discussing calculations
and the necessity of coercive fines having teeth, it
seems to me that a fine of $500 ought to be imposed as
sufficient to uphold the daily fine’s coercive effect
and, that if it is not paid, the judgment should be
sent to the Treasury to collect via tax refund offsets.
It is doubtful that Mr. Smith has been unable for
almost a year to make any payment towards making the
required disgorgement. 	It is thus
ORDERED that by April 30, 2010, Mr. Smith shall
file a writing showing cause why the court ought not
enter a judgment against him of $500.00 for the fine of
$10 per day imposed against him.
Smith having failed to file a response to the court’s show cause
order, the court entered a judgment against Smith on June 1,
2010, in the amount of $500.00 (Dkt. No. 74). 	Then on June 3,
2010, Smith filed a response (Dkt. No. 75) which the court
3
Case 08-00746 Doc 81 Filed 07/26/10 Entered 07/26/10 11:10:33 Desc Main
Document Page 3 of 6

treated as a motion to vacate the $500 judgment. 1
Smith’s response stated that on April 23, 2010, Smith paid
the $1,500 to the clerk of court in accordance with the court’s
disgorgement order, and “that payment met all the terms of this
Courts [sic] Order at that time and freed Smith of any possible
sanctions for not abiding by this Courts [sic] Order.”
In an order signed on June 26, 2010, and entered on June 28,
2010 (Dkt. No. 77), the court denied the motion to vacate
implicitly made in the response (Dkt. No. 75). 	The court noted
that the $500 sanction, arose from the $10 per day coercive
contempt fine that began accruing on May 6, 2009, and Smith’s
eventual compliance with the disgorgement order - more than a
year after the court originally ordered disgorgement - did not
relieve Smith of the sanctions that had already accrued. 	Rather,
it merely prevented the accrual of additional coercive contempt
sanctions. 	The court further noted that, despite Smith’s mention
of financial difficulties in his January 15, 2010 motion to
extend the deadline (Dkt. No. 68), he never mentioned financial
difficulties prior to January 15, 2010, and that “[i]nstead, over
1 	Although the certificate of service stated that the
response was served on May 2, 2010, the response was not filed
until June 3, 2010. 	Also, Smith indicated that his filing was a
response to a show cause order that the court issued on May 21,
2010, yet the only recently issued show cause order in this case
was issued on March 23, 2010. 	Given the content of Smith’s
response, the court assumed that Smith intended the response to
relate to the March 23, 2010 show cause order.
4
Case 08-00746 Doc 81 Filed 07/26/10 Entered 07/26/10 11:10:33 Desc Main
Document Page 4 of 6

eight months passed without any word from Smith about the status
of the disgorgement order, leaving this court to assume that
Smith remained in wilful disregard of the disgorgement order.”
Order signed June 26, 2010 (Dkt. No. 77) at 4 n.2. 	Accordingly,
Smith’s response (Dkt. No. 75) to the show cause order failed to
articulate a basis for relieving Smith of the $500 coercive
contempt sanction that accrued prior to his compliance with the
disgorgement order and prior to his filing of motions to extend
the deadline and to modify the disgorgement order.
Smith has now filed a motion (Dkt. No. 80) to reconsider the
order signed on June 26, 2010 (Dkt. No. 77).
II
The court's order of June 26, 2010, fully explained why the
$500.00 coercive contempt sanction was warranted. 	The Motion for
Reconsideration of that order fails to raise any meritorious
ground demonstrating that the $500.00 coercive contempt sanction
was unwarranted. 	Smith states that "I had assumed, erroneously,
that if the Court understood and accepted counsels [sic]
explanation that the current economic recession made it extremely
difficult to disgorge, it would follow logically, that no
additional 'teeth' were needed in the form of a contempt fine to
spur this attorney to obey this court’s order." 	With coercive
contempt sanctions accruing starting May 6, 2009, Smith ought to
have disgorged fees long ago, and ought to have raised inability
5
Case 08-00746 Doc 81 Filed 07/26/10 Entered 07/26/10 11:10:33 Desc Main
Document Page 5 of 6

to comply in a timely fashion. 	In any event, even if he were now
allowed belatedly to attempt to raise his financial difficulties
as a defense against coercive sanctions, he only says that
compliance would have been extremely difficult, not impossible,
and he has not made out a valid defense.
An order follows denying Smith’s Motion for Reconsideration
of Order Dated June 26, 2010, and to Vacate $500 Judgment for
Contempt.
[Signed and dated above.]
Copies to: Debtor; Debtor’s attorney; Chapter 13 Trustee.
6	O:\TEEL\LSO\ORDERS\Sanctions\Mem Decsn Mtn to Reconsider_sanctions_attorney Smith_Bolling .wpd
Case 08-00746 Doc 81 Filed 07/26/10 Entered 07/26/10 11:10:33 Desc Main
Document Page 6 of 6