United States District Court, D. New Mexico
MEMORANDUM OPINION AND ORDER
matter comes before the Court upon Rune Kraft's Motion to
Set Aside Order to Show Cause (Motion), filed May 1, 2017.
(Doc. 143). On April 12, 2017, the Court entered an Order to
Show Cause requiring Rune Kraft to appear in person, at the
Las Cruces, New Mexico, Federal Courthouse, on June 29, 2017,
“to show cause why he should not be sanctioned, by
monetary sanctions, a finding of contempt, and/or a referral
to the State Bar of New Mexico for the unauthorized practice
of law, [and] for continuing to file pleadings as a
non-lawyer on behalf of his business entities….”
(Doc. 132) at 4. Rune Kraft now moves to set aside the Order
to Show Cause. Having considered the Motion and relevant law,
the Court denies the Motion.
initial matter, the Court will not consider the sections in
the Motion in which Kraft Americas Holdings, Inc. (KAHI)
purportedly “wish[es] to plead and conduct this
Case” on the basis of constitutional rights and
statutory authority. (Doc. 143) at 4-6. As the Court has
repeatedly stated, Rune Kraft, as a non-attorney, cannot
legally represent KAHI and file pleadings on its behalf.
See (Docs. 14, 56, 89, 114, 126, and 132). See
also D.N.M. LR-Cv 83.7 (corporation “must be
represented by an attorney authorized to practice before this
Court.”); D.N.M. LR-Cv 83.8(c) (corporation “can
only appear with an attorney” and, absent entry of
appearance by an attorney, filings by a corporation
“may be stricken and default judgment or other
sanctions imposed”). In addition, the Court will not
consider references to Rune Kraft's previous motions
(Docs. 120 and 128) which the Court has stricken.
See (Docs. 126 and 132).
Kraft first argues that the Court should set aside the Order
to Show Cause because, as a KAHI corporate officer, he is
authorized to act on behalf of KAHI. The Tenth Circuit,
however, has explicitly rejected such an argument. In
Harrison v. Wahatoyas, L.L.C., the Court held that
“[a]s a general matter, a corporation or other business
entity can only appear in court through an attorney and not
through a non-attorney corporate officer appearing pro
se.” 253 F.3d 552, 556-57 (10th Cir. 2001). This first
argument, thus, has no merit.
Rune Kraft argues this court should waive the Local Rules
requiring that corporations be represented by legal counsel.
Rune Kraft cites D.N.M. LR-Cv 1.7, which states that the
Local Rules “may be waived by a Judge to avoid
injustice.” Rune Kraft does not explain how requiring
KAHI to obtain legal counsel is somehow unjust. To the
contrary, because all business entities are required to
obtain legal counsel in order to participate in litigation,
it would be unjust to those entities to allow KAHI to avoid
that requirement. The Court rejects Rune Kraft's waiver
Rune Kraft argues that he is not practicing law because he
has no clients. Rune Kraft fails to understand that in the
context of the practice of law, a “client” can be
a corporation, like KAHI, “who consults with, seeks
advice from, or retains the professional services of a lawyer
or a lawyer's representative….” N.M. R.
Evid. 11-503(A)(1). Here, KAHI certainly is consulting with
and seeking advice from Rune Kraft as well as retaining
professional legal services from Rune Kraft, such as the
preparation and filing of legal documents. Under these
circumstances, KAHI is Rune Kraft's “client.”
Hence, this third argument lacks merit.
Rune Kraft mentions Fed.R.Civ.P. 54(b), which allows the
Court to revise its orders. A Rule 54(b) motion is “an
interlocutory motion invoking the district court's
general discretionary authority to review and revise
interlocutory rulings prior to entry of final
judgment.” Wagoner v. Wagoner, 938 F.2d 1120,
1122 n. 1 (10th Cir.1991). In analyzing Rule 54(b) motions,
the Tenth Circuit looks to Fed.R.Civ.P. 59(e) for guidance.
Ankeney v. Zavaras, 524 Fed.Appx. 454, 458 (10th
Cir. 2013) (stating that in considering Rule 54(b) motion to
reconsider, “court may look to the standard used to
review a motion made pursuant to Federal Rule of Civil
59(e) movant carries the burden of demonstrating that the
Court should alter or amend a judgment. See, e.g.,
Wilkins v. Packerware Corp., 238 F.R.D. 256, 262-63 (D.
Kan. 2006) (stating that movant must establish reasons for
granting Rule 59(e) motion). Rule 59(e) relief is appropriate
if there is new controlling law, new evidence not available
previously, or a “need to correct clear error or
prevent manifest injustice.” Servants of the
Paraclete v. Does, 204 F.3d 1005, 1012 (10th Cir.
Tenth Circuit has defined clear error as “an arbitrary,
capricious, whimsical, or manifestly unreasonable
judgment.” Wright ex rel. Trust Co. of Kan. v.
Abbott Labs., Inc., 259 F.3d 1226, 1236 (10th Cir.
2001). Although the Tenth Circuit has not specifically
defined manifest injustice in the Rule 59(e) context, other
courts have defined manifest injustice as “direct,
obvious, and observable error” that is indisputable.
Estate of McDermed by & through McDermed v. Ford
Motor Co., 2017 WL 1492931, at *3 (D. Kan.) (citations
Kraft does not argue that there is either new controlling law
or new evidence which would require the Court to reconsider
its Order to Show Cause. Rather, he seems to contend that the
Court should modify its Order to Show Cause to provide an
“alternate way” to conduct the show cause
hearing. Rune Kraft states that he
has no reasons [sic] to be in the United States on June 29,
2017 and would have to travel approximately 8, 300 miles to
appear at a hearing in Las Cruces. In additional [sic] to the
unreasonable burden of time and expense to make such a trip
he furthermore has personal and business obligations that
make such a trip impossible.
(Doc. 143) at 10.
Court notes first that, although Rune Kraft is no longer a
defendant, he continues to insert himself into this
litigation by filing motions and other documents on his own
behalf and on behalf of KAHI. Rune Kraft's voluntary
involvement in the litigation means that he must be willing
to appear at the place where the litigation takes place,
i.e., Las Cruces. The expenditure of money and time to appear
for in-person hearings simply is the cost of litigation.
Moreover, considering Rune Kraft pro se status and
his conduct in this litigation, it is important for both the
Court and Rune Kraft to have an opportunity to personally
address the very serious issue of possible sanctions. This is
exactly the kind of hearing in which a personal appearance is
more than appropriate and necessary, especially in light of
Rune Kraft's conduct. An in-person hearing also will
provide the Court a better opportunity to assess Rune
Rune Kraft's vague reference to “personal and
business obligations” simply does not provide a
sufficient reason to change the show cause hearing from an
in-person hearing to some other kind of
hearing. For the foregoing reasons, it is not
“arbitrary, capricious, whimsical, or manifestly
unreasonable” to order Rune Kraft to appear for an
in-person show cause hearing nor is it an indisputable as
well as “direct, obvious, and observable error”
to require such an appearance. Consequently, requiring Rune
Kraft to personally appear at the show cause hearing is
neither clear error ...