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Friday, September 26, 2008

Ind. Courts - 7th Circuit decides one Indiana case today

In U.S. v. Derrik Hagerman and Walbash Env. Tech. (SD Ind., Judge Hamilton), a 5-page opinion, Judge Posner dismisses the appeal, writing:

The defendants were convicted of criminal violations of the Clean Water Act, and Wabash was ordered to pay $250,000 in restitution to a federal Superfund account and was placed on probation (18 U.S.C. § 3563) for five years. Corporate probation has been called “a flexible vehicle for imposing a wide range of sanctions having the common feature of continued judicial control over aspects of corporate conduct.” * * * The government, contending that Wabash had violated the conditions of probation by refusing to begin paying the restitution (and a $4,000 special assessment), that had been ordered, petitioned the district court for relief, as authorized by 18 U.S.C. § 3563(c). The court dismissed the petition after the government and Wabash resolved their differences by Wabash’s agreeing to start paying restitution and to furnish specified information concerning the company’s finances. Nevertheless, Wabash has filed an appeal to this court from the order of dismissal, as has its codefendant, Hagerman.

Hagerman’s appeal must be dismissed because he was not a party to the probation-violation proceeding and no order naming him was entered. Wabash’s appeal must also be dismissed, apart from doubts that Wabash was aggrieved by the dismissal of the probation-violation proceeding. Wabash has no lawyer in this court (it was represented in the district court by a lawyer who has since withdrawn). Hagerman, who is not a lawyer, claims the right to represent Wabash because he “is not only a major stockholder [presumably he means ‘member,’ since Wabash is an LLC, not a corporation] but is [also the] current President of [Wabash].” And it was Hagerman who filed this appeal on behalf of Wabash as well as himself. He complains about the deal that Wabash struck with the government, making this like an appeal by a party that agrees to a settlement but later thinks better of his decision and tries to get the appellate court to rescind it.

A corporation is not permitted to litigate in a federal court unless it is represented by a lawyer licensed to practice in that court. * * * A limited liability company is not a corporation, but it is like one in being distinct from a natural person. * * *

We have not had occasion to rule on whether, like a corporation, an LLC can litigate only if represented by a lawyer. * * *

[The opinion concludes that "the privilege of pro se representation" is denied to corporations, limited liability companies, and partnerships.]

Posted by Marcia Oddi on September 26, 2008 10:11 AM
Posted to Ind. (7th Cir.) Decisions