Sabaugh v. Snyder

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
1
UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
In re
STEPHEN SNYDER, No. 05-14194
Debtor(s).
______________________________________/
KIMBERLY SABAUGH,
Plaintiff(s),
v. A.P. No. 06-1045
STEPHEN SNYDER,
Defendant(s).
_______________________________________/
Memorandum on Motion for Reconsideration
_________________
This is a particularly ugly adversary proceeding in which plaintiff Kimberly Sabaugh seeks
nondischargeable damages against Chapter 7 debtor and defendant Stephen Snyder. Sabaugh alleges that
she and Snyder, a lawyer, had a “co-habiting and dating relationship.” She further alleges that during their
relationship Snyder borrowed money from her with no attempt to pay it back and used her credit card without
her permission. She also alleges that he assumed control of her retirement account and has failed to account
for the money which he “[l]ikely sent to an offshore account or paid to an investor in what appears to be a
Entered on Docket
August 28, 2007
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 06-01045 Doc# 55 Filed: 08/28/07 Entered: 08/28/07 13:22:12 Page 1 of 6

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
1The complaint also alleges some domestic violence. Sabaugh has since dropped these allegations.
2Sabaugh argues that she interpreted the court’s scheduling conference order, requiring the pre-
marking and exchange of exhibits seven days before hearing, as supplanting the 30-day requirement of Rule
26(a)(3)(C). While this was not the intent of the court, the court does see how this might be mis-interpreted.
However, the fact remains that Sabaugh made no disclosures whatsoever, even after seeing Snyder’s proper
disclosure. She advances no excuse for failure to comply with Rules 26(a)(3)(A) or (B). This issue is not
currently relevant, since Snyder has not filed a motion for sanctions.
2
pansy [sic] scheme.”1
When their relationship ended in 2003, Snyder gave Sabaugh a note for $131,000.00 which he says
he gave her “in order to obtain some degree of peace.” The note recites that it is “expressly excluded from
any bankruptcy filing or attempt at discharge.”
On October 24, 2006, the court set the matter for trial on March 29, 2007. On February 14, 2006,
Snyder filed a motion for summary judgment supported by a detailed declaration outlining the background of
his relationship and financial dealings with Sabaugh. He set the hearing on his motion for March 16, 2007.
On February 28, 2007, Snyder filed his pretrial disclosures required by FRCP 26(a)(3). On the
same date, the court continued the trial to April 4, 2007. On March 2, 2007, Sabaugh filed a countermotion
for summary judgment.
Due to surgery, the court was unable to hear the motions for summary judgment which had been set
for the eve of trial. However, the court was able to convene the trial on April 4. Snyder objected to the trial
going forward on the grounds that Sabaugh had failed to make her Rule 26 pretrial disclosures.2 There
appearing to be prejudice, the court vacated the trial date and noted that Snyder could make a motion for
sanctions. However, since there was to be no trial the court stated that it would hear the motions for summary
judgment on April 13, 2007.
On March 2, 2007, Sabaugh’s attorney electronically filed what he had represented was a
declaration of his client in support of her motion for summary judgment and in opposition to that of Snyder.
At the hearing on April 13, counsel for Snyder raised questions as to its authenticity. The court asked
Shoblum to produce the signed original but he was unable to do so, informing the court that all he had was a
Case: 06-01045 Doc# 55 Filed: 08/28/07 Entered: 08/28/07 13:22:12 Page 2 of 6

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
3
facsimile copy.
The declaration was false on its face, in that it was dated March 3 yet is was filed on March 2.
Moreover, Rule 8(c) of the Amended Operating Order governing electronic filings in the bankruptcy courts of
this district provides:
The electronic filing of a document purportedly signed by someone other than the
Registered Participant, including but not limited to the petition, statement of financial
affairs, and schedules of assets and liabilities, shall be deemed a certification by the
Registered Participant that he or she has the document in question, bearing the person’s
original signature, in his or her physical possession. The Registered Participant must
produce the original signed document on request by the Court.
When Sabaugh’s counsel was unable to produce the original signature, Snyder moved that the declaration be
striken. The court took the motions under submission and on April 13, 2007, issued its written decision to
strike the declaration. Before an order could be entered, Sabaugh moved for reconsideration, arguing that
because the declaration was faxed to him for filing a fax copy of the signature was all that was required. The
court rejected this argument by memorandum on April 16, 2007.
On May 7, 2007, the court issued its memorandum on the summary judgment motions. Since
Sabaugh had no competent declarations in support of her motion or in opposition to Snyder’s, the court
granted his motion and denied hers. The court noted:
Once judgment is entered, the court may entertain a motion to be relieved from
what is in essence a default. However, the court will need to see sound evidence
of a meritorious case and plaintiff and her counsel can expect to compensate
plaintiff for all expenses and fees reasonably related to their procedural lapses as a
condition of any such relief.
Judgment for Snyder was entered on July 11, 2007. Instead of accepting the court’s invitation to file a
motion for relief from the judgment pursuant to FRCP 60(b), Sabaugh has filed another motion to reconsider.
As far as the court can discern from somewhat disjointed argument, Sabaugh bases her motion on
three arguments. First, she argues once more that her declaration was proper notwithstanding the failure of her
counsel to produce a signed copy. Second, she argues that even if the declaration was not proper it still was
sufficient to defeat a motion for summary judgment. Third, she argues that Snyder’s motion for summary
judgment should not have been granted even if there was no proper opposition. While the court is not clear as
Case: 06-01045 Doc# 55 Filed: 08/28/07 Entered: 08/28/07 13:22:12 Page 3 of 6

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
3It may be that the prospect of further sanctions are not palatable to Sabaugh. The court notes that it
has previously sanctioned her $2,200.00 for discovery violations in this case.
4Sabaugh has not refiled the declaration or produced a “wet” copy of her declaration in the months
since the April13 hearing, insisting that there was no requirement that she do so.
4
to Sabaugh’s desire to take this path, she certainly has a right to do so.3 The court will accordingly address
each of her arguments.
The economic values of electronic case filing (“ECF”) to both the government and the parties is
beyond question. One of the problems addressed by the many courts implementing ECF is how to insure that
individuals remain responsible for perjury. A common way of dealing with this problem, adopted by many of
the courts implementing ECF, is to require an attorney who files a client’s declaration to maintain the “wet”
copy in his or her file and produce it on request. It is clear that Sabaugh’s attorney had no such copy when he
filed her declaration.4
The court will not again address the nonsensical argument that a facsimile signature is an original
signature. Sabaugh argues, however, that the interim operating order is unenforceable.
The interim operating order implementing ECF in this district is proper and enforceable pursuant to
Federal Rule of Civil Procedure 83 and Federal Rules of Bankruptcy 5005(a)(2), 9006(f), 9011, 9022, 9029,
and 9036. In re Brown, 328 B.R. 556, 558 ( Bkrtcy.N.D.Cal.2005) See also In re Phillips,
317 B.R. 518, 523 (8th Cir.BAP,2004). Several courts have found documents filed electronically can be
striken if the proper rules regarding original signatures have not been followed. See, e.g., Cole v. Houston,
2007 WL 1309821 (D.Neb.2007)[“While a document may be a photocopy, a signature may not. The Clerk
of Court issues a Notice of Deficiency when an original signature is absent from a filing. It is then possible that
the document could be stricken from the record if the deficiency is not cured.”].
Of course, FRCP 83(a)(2) forbids making a nonwillful failure to comply with a local rule fatal. The
court never intended that the failure to comply be fatal, but only that the mistake be corrected and the other
side compensated for expenses incurred. For a reason the court does not understand, Sabaugh’s counsel is
doing his best to turn his failure to comply with ECF rules into a fatal mistake.
Case: 06-01045 Doc# 55 Filed: 08/28/07 Entered: 08/28/07 13:22:12 Page 4 of 6

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
5Sabaugh’s most incomprehensible argument is that a defective declaration, even an unsigned
declaration, is sufficient to defeat a motion for summary judgment. She offers no authority for this assertion.
6Sabaugh makes much of the “excluded from bankruptcy” language in the note, which the court has
pointed out might be some small evidence of fraudulent intent even though it is not enforceable, as Snyder is a
lawyer. However, Sabaugh seems not to understand that as the party with the burden of proof at trial she
needs to establish triable issues of fact as to all elements of her case, not just one.
5
ECF rules aside, the essential fact is that Sabuagh’s declaration was defective and that means that a
motion for summary judgment filed by the other side was not validly opposed.5 As plaintiff, Sabaugh bears the
burden of proof at trial. Summary judgment is mandatory against a party who fails to make a showing
sufficient to establish the existence of an element essential to that party’s case and upon which the party will
bear the burden of proof at trial. 27A Fed.Proc.L.Ed., Pleadings and Motions § 62:642, p. 389, citing
Celotex Corp. V. Catrett, 477 U.S. 317 (1986). See also Crawford-El v. Britton, 523 U.S. 574, 600
(1998).6
The court admits that it is growing tired of the string of motions for reconsideration filed by Sabaugh,
especially since they are accompanied by unsupported or nonsensical arguments; if there is a nugget of merit in
any of them, the court is unable to pan it out. Accordingly, the court will give Sabaugh one more chance to set
things on a proper keel before she looks to other courts for relief. The court will order as follows:
1. Insofar as Sabaugh seeks reconsideration of the order denying her motion for summary judgment,
her motion for reconsideration will be DENIED.
2. Sabaugh shall have 20 days from the date of this memorandum to supply Snyder’s attorney with a
copy of her declaration filed March 2, 2007, which contains an actual (not facsimile) signature and to
compensate Snyder for any expenses incurred due to her counsel’s failure to have such a signed copy in his
files on that date. If she does so, then the summary judgment against her will be VACATED and Snyder’s
motion for summary judgment shall be deemed UNDER SUBMISSION. If she fails to supply the signed
copy, her motion for reconsideration will be DENIED IN TOTO. If the parties are unable to agree on a sum
for compensation, the court will hear the matter on October 25, 2007, at 10:00 A.M. Snyder’s evidence of
Case: 06-01045 Doc# 55 Filed: 08/28/07 Entered: 08/28/07 13:22:12 Page 5 of 6

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
6
compensation sought shall be in the form of declarations filed and served by October 15, 2007; declarants
shall be present in person at the hearing.
3. If Snyder seeks sanctions for Rule 26 violations, he shall set such a motion for the same time and
place on 20 days’ notice.
4. The rest of Sabaugh’s motion will be DENIED WITHOUT PREJUDICE, to be renewed when
and if the court resets this case for trial.
5. If Sabaugh supplies the signed declaration described in Paragraph 2 above by the prescribed time,
then, upon written request of either party, this matter shall be REFERRED to the court’s alternative dispute
resolution program.
Counsel for Snyder shall submit an appropriate form of order.
Dated: August 28, 2007
SAlan Jaroslovsky
U.S. Bankruptcy Judge
Case: 06-01045 Doc# 55 Filed: 08/28/07 Entered: 08/28/07 13:22:12 Page 6 of 6