Case Summary:
Debtor moved the court to impose sanctions under Rule 9011 and 28 U.S.C. § 1927 against counsel for mortgage creditor alleging three (3) separate pleadings violated Rule 9011. The Debtor alleged opposing counsel deliberately misidentified the mortgage creditor in an effort to "conceal the authority under which [counsel] purport[ed] to engage in litigation activities . . . ." The Court concluded sanctions were not warranted because (1) the mortgage creditor filed the pleadings in an effort to protect its security interest in collateral; (2) the mortgage creditor demonstrated a right to payment in state foreclosure proceedings; and (3) the mortgage creditor proposed a legal theory creating a prima facie case as to why the case should be dismissed.

Statute/Rule References:
11 U.S.C. § 1322(b)(2) -- Modification of Rights of Secured Claimants
28 U.S.C. § 1927 -- Counsel’s Liability for Excessive Costs
Fed. R. Bankr. P. 9011 -- Sanctions