Statutes and Rules of Court Penalizing Frivolous Litigation
In the United States Tax Court, frivolous arguments may result in a penalty of up to $25,000 under 26 U.S.C. ยง 6673(a)(1). Similarly, section 7482 of the Internal Revenue Code provides that the U.S. Supreme Court and the federal courts of appeals may impose penalties where the taxpayer's appeal of a U.S. Tax Court decision was "maintained primarily for delay" or where "the taxpayer's position in the appeal is frivolous or groundless." A common example, as shown below, is an argument based on tax protestor claims.
In a non-criminal case in a United States district court, a litigant (or a litigant's attorney) who presents any pleading, written motion or other paper to the court is required, under Rule 11 of the Federal Rules of Civil Procedure, to certify that, to the best of the presenter's knowledge and belief, the legal contentions "are warranted by existing law or by a nonfrivolous argument for the extension, modification, or reversal of existing law or the establishment of new law". Monetary civil penalties for violation of this rule may in some cases be imposed on the litigant or the attorney under Rule 11. In one case, the Seventh Circuit issued an order giving such an attorney "14 days to show cause why he should not be fined $10,000 for his frivolous arguments". A similar rule penalizing frivolous litigation applies in U.S. Bankruptcy Court under Rule 9011.
Congress has enacted section 1912 of title 28 of the United States Code providing that in the United States Supreme Court and in the various courts of appeals where litigation by the losing party has caused damage to the prevailing party, the court may impose a requirement that the losing party pay the prevailing party for those damages.
Litigants who represent themselves (in forma pauperis and pro se) sometimes make frivolous arguments due to their limited knowledge of the law and procedure. The particular tendency of prisoners to bring baseless lawsuits led to passage of the Prison Litigation Reform Act of 1995, which limits the ability of prisoners to bring actions without payment.
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