    11-3248
    Truong v. Nguyen




                            UNITED STATES COURT OF APPEALS
                                FOR THE SECOND CIRCUIT

                                  SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER
FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE
PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A
DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING TO A SUMMARY
ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

            At a stated term of the United States Court of Appeals for the Second Circuit, held at the
    Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New York,
    on the 20th day of November, two thousand twelve.

    PRESENT:
                ROBERT A. KATZMANN,
                DEBRA ANN LIVINGSTON,
                RAYMOND J. LOHIER, JR.,
                      Circuit Judges.
    ____________________________________________

    Mac Truong,

                                  Plaintiff-Appellant,

                       v.                                               11-3248

    Hung Thi Nguyen, Alphonse Hotal Corp., Elaine
    Nguyen, Sang Kim Nguyen, Truong Dinh Tran,

                            Defendants-Appellees.
    ____________________________________________

    FOR PLAINTIFF-APPELLANT:                     Mac Truong, pro se, New York, NY.

    FOR DEFENDANT-APPELLEE:                      Marc Bogatin, New York, NY.
       Appeal from orders of the United States District Court for the Southern District of New

York (Batts, J.).

       UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND

DECREED that the orders are VACATED and the proceeding is REMANDED.

       Appellant Mac Truong, proceeding pro se, appeals from the district court’s order

imposing both leave-to-file and monetary sanctions and requiring Truong to pay the defendants

$4,185 to cover their attorney’s fees and costs.1 We assume the parties’ familiarity with the

underlying facts, the procedural history of the case, and the issues on appeal.

       We review a district court’s decision to impose sanctions under its inherent powers for an

abuse of discretion. See Gollomp v. Spitzer, 568 F.3d 355, 368 (2d Cir. 2009). “[A] court’s

inherent power derives from the sage acknowledgment that courts are ‘vested, by their very

creation, with power to impose silence, respect, and decorum, in their presence, and submission

to their lawful mandates.’” DLC Mgmt. Corp. v. Town of Hyde Park, 163 F.3d 124, 136 (2d Cir.

1998) (quoting Chambers v. NASCO, Inc., 501 U.S. 32, 43 (1991)). “Because of the potency of

[a] court’s inherent power, courts must take pains to exercise restraint and discretion when

wielding it.” Id.; accord United States v. Seltzer, 227 F.3d 36, 39 (2d Cir. 2000).

       “Due process requires that courts provide notice and opportunity to be heard before

imposing any kind of sanctions.” Schlaifer Nance & Co. v. Estate of Warhol, 194 F.3d 323, 334

(2d Cir. 1999) (citation and internal quotation marks omitted). Specifically, “[a]t a minimum,



       1
         This Court, enforcing its own leave-to-file sanctions, previously denied Truong’s
request to appeal from the district court’s grant of summary judgment on his underlying claims.
See U.S.C.A. Dkt. No. 11-2088 doc. 20. Thus, any arguments Truong addresses to that decision
are not properly presented.

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the notice requirement mandates that the subject of a sanctions motion be informed of,” inter

alia, “the source of authority for the sanctions being considered.” Id. We have observed that

this requirement is fulfilled by the identification of the relevant Federal Rule of Civil Procedure

or statute that warrants imposition of a sanction. Id. at 334-35 (finding that a motion for

sanctions that focused “chiefly on Rule 11 as the basis for sanctions” but that “also invoked and

set forth the standards for sanctions under the District Court’s inherent power and 28 U.S.C. §

1927 as well,” was sufficient to provide “notice of the source of authority for the requested

sanctions”).

       Here, the district court did not provide adequate notice to Truong prior to imposing either

leave-to-file or financial sanctions, as it did not inform him, in the present proceeding, that it was

considering imposing sanctions prior to imposing them. Although the district court found that

Truong was on notice because another judge in the Southern District of New York had

previously imposed leave-to-file sanctions, see Vishipco Line v. Charles Schwab & Co., No. 02

Civ. 7823 (SHS), 2003 WL 1345229, at *9-10 (S.D.N.Y. Mar. 19, 2003), and had previously

warned Truong that “any further harassing or vexatious litigation by him [would] be subject to

sanction,” Vitranschart, Inc. v. Levy, No. 00 Civ. 3618 (SHS), 2000 WL 1239081, at *11

(S.D.N.Y. Aug. 31, 2000), neither prior order notified Truong of the need to “prepare a defense”

against the imposition of sanctions based on his “specific conduct” in the present proceeding, see

Schlaifer Nance & Co., 194 F.3d at 334. Moreover, the district court did not notify Truong of

the relevant authority under which it was considering imposing sanctions. Id.

       We also conclude that the district court’s leave-to-file injunction—which bars Truong

from filing any lawsuit on any claim in any court against any party without first obtaining, in

writing, the express permission of the court in which he wishes to proceed—is too broad. See


                                                  3
Bd. of Managers of 2900 Ocean Ave. Condo. v. Bronkovic, 83 F.3d 44, 45 (2d Cir. 1996) (per

curiam) (“[Filing] injunctions must be appropriately narrow.”); see also In re Martin-Trigona,

737 F.2d 1254, 1262-63 (2d Cir. 1984).

       Finally, “[i]mposition of [financial] sanctions under a court’s inherent powers requires a

specific finding that [a party] acted in bad faith.” Wolters Kluwer Fin. Servs., Inc. v. Scivantage,

564 F.3d 110, 114 (2d Cir. 2009). “Moreover, inherent-power sanctions are appropriate only if

there is clear evidence that the conduct at issue is (1) entirely without color and (2) motivated by

improper purposes.” Id. “A finding of bad faith, and a finding that conduct is without color or

for an improper purpose, must be supported by a high degree of specificity in the factual

findings.” Id. Additionally, “when a court awards defendants attorney’s fees, it must take into

account the financial circumstances of the plaintiff.” Sassower v. Field, 973 F.2d 75, 81 (2d Cir.

1992). Here, the district court did not make a specific finding of bad faith. Moreover, although

the district court explained that Truong had a history of contempt for court orders, it neither

explicitly found that Truong had brought the current suit for any improper purpose nor identified

the “clear evidence” of such a purpose. Furthermore, the district court did not consider, as it

should have, Truong’s financial circumstances when imposing attorney’s fees. See id.

       These procedural errors require us to vacate and remand the district court’s order. But we

leave to the sound discretion of that court the question of whether leave-to-file and monetary

sanctions are appropriate here upon proper notice and an opportunity to be heard.

       For the foregoing reasons, the orders of the district court are hereby VACATED and the

proceeding is REMANDED.

                                              FOR THE COURT:
                                              Catherine O’Hagan Wolfe, Clerk




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