By Mary Slosson

(Reuters) - A federal judge on Tuesday ordered the city of Oakland and its police department to submit a plan within a week to address a backlog of complaints stemming from their handling of Occupy protests, threatening sanctions if they fail to do so.

The mandate by District Judge Thelton Henderson follows the release of a report by an outside monitor that said Oakland police used "an overwhelming military-type response" to the demonstrations.

The report also confirmed, for the first time from an official source, that an Oakland police SWAT team member fired a beanbag round at an Iraq war veteran during clashes in October.

Former U.S. Marine Scott Olsen was critically wounded by what protesters said at the time was a tear gas canister fired by police.

Olsen's case reinvigorated the Occupy movement against economic inequality, and the confrontations with police in subsequent protests turned Oakland into a focal point for the movement as demonstrators rallied against what they described as police brutality.

Thousands of protesters took to the streets of Oakland on Tuesday as part a nationwide movement against economic inequality. Demonstrators clashed with police, who fired multiple rounds of tear gas and flash bang grenades. At least nine people were arrested.

The Oakland Police Department has been subject to court-ordered external monitoring and review since the 2003 settlement of what was known as the Riders case, in which four officers were accused of planting evidence, fabricating police reports and using unlawful force, according to the Oakland police.

"It would be problematic enough if, as seems inevitable, (Oakland police's) compliance levels were to backslide as a result of their failure to address the Occupy Oakland complaints in a timely fashion," Henderson wrote in his three-page written order.

"Such failures would be further indication that, despite the changed leadership at the City of Oakland and its police department, (Oakland police) might still lack the will, capacity, or both to complete the reforms to which they so long ago agreed," he wrote.

Henderson said that if officials fail to submit the plan by next week and implement it by May 14, "the court will consider appropriate sanctions, including the imposition of daily or weekly monetary sanctions, until compliance is achieved."

Oakland police officials announced last week that the department was making significant changes to how it trains officers to control large crowds following criticism over its practices during Occupy Oakland protests that sometimes turned violent. It received more than 1,000 misconduct complaints during those protests.

(Editing by Dan Whitcomb and Lisa Shumaker)