The opinion of the court was delivered by: COLLEEN KOTELLY, District Judge
Plaintiff Leslie Atkins, d/b/a Leslie Atkins Communications,
Inc., brought this action against Defendants Benson J. Fischer,
the Fischer Organization, Inc., and the Fischer Brewing Company,
Inc. (collectively, "Defendants"), alleging copyright
infringement in the commercial use of six-pack carrier and bottle
designs for a product called "Redneck Beer" in violation of the
Copyright Act of 1973, 17 U.S.C. § 102, and Section 43(a) of the
Lanham Act, 15 U.S.C. § 1125(a). Currently before the Court is
Plaintiff's Motion for Finding that Defendants and Their Prior
Counsel, Stanley Goldschmidt, Esquire, Attempted to Perpetrate a
Fraud Against This Court and For an Award of Appropriate
Sanctions, the separate Oppositions filed by Defendants and Mr.
Goldschmidt, and Plaintiff's Combined Reply. Also pending before
the Court is Mr. Goldschmidt's Motion for Sanctions Against
Plaintiff for Violation of Federal Rule of Civil Procedure 11,
and Plaintiff's subsequent Opposition.
Upon a searching examination of the parties' respective
filings, all attached exhibits, the relevant case law, and the
entire record herein, the Court shall grant-in-party and
deny-in-part Plaintiff's motion and shall deny Mr. Goldschmidt's motion for
sanctions.*fn1 Given the present posture of the case, the
Court shall set a status conference in order to set out the
scheduling groundwork for the upcoming trial on the merits in the
Plaintiff Leslie Atkins, d/b/a Leslie Atkins Communications,
Inc., has for over twenty years, offered clients a wide range of
public relations, advertising, and marketing services. Defendant
Benson J. Fischer, an entrepreneur planning to produce a novelty
beer,*fn2 dubbed "Redneck Beer," hired Plaintiff during
September of 1993 to design a bottle label and a six-pack carrier
for his anticipated beer. Under the first stage of the relevant
agreement, Plaintiff delivered to Defendant Fischer a preliminary
illustration of a beer bottle label featuring a blue jean pocket
and a red bandana. The second phase of the agreement, which
required Plaintiff to produce the same label and carrier in
"camera-ready" final form, was never completed, and the agreement
was terminated. Between August 1995 and June 1996, Redneck Beer
was proudly sold in fine stores in thirty-four (34) states across the United
States using a bottle label and carrier designed by a third-party
which also featured a denim pocket and a red bandana.
Contending that the subsequent design infringed upon her
copyrighted work, Plaintiff filed her Complaint in this action in
March 1998. After the close of discovery, pursuant to a
Memorandum Opinion and Order dated November 30, 2001, this Court
denied Plaintiff's motion for summary judgment and sua sponte
granted summary judgment for Defendants. See Atkins v. Fischer,
Civ. No. 98-800, at 33-34 (D.D.C. Nov. 30, 2001) (order granting
summary judgment to Defendants). The Court concluded that (1)
Defendants had an implied nonexclusive license to use Plaintiff's
work in the commercial production of Redneck Beer; and (2) the
six-pack carrier design actually used by Defendants in the sale
of Redneck Beer was not substantially similar to Plaintiff's
preliminary designs. Id. In addition, the Court dismissed
Plaintiff's Lanham Act claim. Id. Upon appeal, the D.C. Circuit
determined that (1) an issue of material fact existed as to
whether Defendants had an implied license to use Plaintiff's
marketing design for production, and (2) an issue of material
fact also existed as to whether Plaintiff's marketing copy and
the actual production copy of the six-pack carrier were
"substantially similar." See Atkins v. Fischer, 331 F.3d 988,
993-995 (D.C. Cir. 2003). Given these substantial issues of
material fact, the D.C. Circuit reversed this Court's November
30, 2001 ruling and remanded the case to this Court for further
consideration. Id. at 995.
While trial in this case appeared imminent after the decision
by the Court of Appeals, Defendants immediately filed a motion to
stay litigation pending resolution of bankruptcy proceedings. On
November 18, 2003, this Court granted Defendants' motion to stay
as it related to Defendant Benson Fischer. On April 19, 2004,
Defendants informed the Court that Defendant Fischer had consented to relief from the automatic bankruptcy
stay and that this case would now move forward. On June 18, 2004,
Plaintiff filed her current Motion for Sanctions. The Court then
held a status conference with the parties on June 30, 2004,
wherein the Court was informed that this case could not proceed
to trial until the Motion for Sanctions was resolved. However, an
expedient resolution of Plaintiff's motion was thwarted by
Defendants' Motion for an Order Directing Plaintiff's Counsel to
Allow Access to Discovery Documents a motion filed by
Defendants' new counsel, who had determined that a "substantial
amount of discovery related materials" were missing from the
files handed over to them by Defendants' previous attorneys.
See Defs.' Mot. for Order to Allow Access at 2. Defendants
sought to have Plaintiff provide them with access to her copies
of the missing documents, which Defendants would then copy at
their own expense; however, these requests were rebuffed by
Plaintiff's counsel. Id. at 3. Importantly, while Defendants
acknowledged that the missing documents "are not of plaintiff's
making," they stressed that they could not mount a proper defense
of Plaintiff's Motion for Sanctions without the documents many
of which could only be obtained from Plaintiff. Id. at 4.
In order to resolve this dilemma, the Court issued a Memorandum
Opinion and Order on August 17, 2004, which focused on the fact
that "Defendants cannot respond to Plaintiff's motion, or defend
themselves in a potential future trial, without the full record
in this case." Atkins v. Fischer, Civ. No. 98-800, at 3 (D.D.C.
Aug. 17, 2004) (order requiring Plaintiff's counsel to provide
Defendants access to those documents Defendants could not obtain
through any other source). Noting the burden on Plaintiff whose
"attorney works in a small office with few resources to handle
Defendants' request" the Court ordered that "Defendants shall
be permitted access to Plaintiff's files to obtain only those
documents that they do not have in their own files and that
cannot be obtained from other sources." Id. In return for this
privilege, the Court ordered "that Defendants be required to
compensate Plaintiff's counsel not only for the costs of copying
documents, but also for the time that Plaintiff's counsel's
representatives must expend in order to locate and prepare the
documents for Defendants." Id. at 4. Finally, the Court
directed that "Plaintiff shall estimate how much it will cost to
complete this project and provide this estimate to Defendant[s]
prior to beginning work on the project. Plaintiff shall endeavor
to minimize the expense of this undertaking by utilizing
low-level staff where possible." Id.
Despite the Court's even-handed, clear bargain, progress in
this process immediately broke down. Plaintiff filed a Motion for
Clarification of the Court's Order on September 7, 2004, in which
she announced that her counsel would copy all identified
documents "except for documents produced by the Fischer
defendants themselves in this case almost all of which
Defendants now claim are `missing,'" Pl.'s Mem. in Support of Her
Mot. for Clarification at 2. Plaintiff further asserted that Mr.
Fischer (on behalf of Defendants), Mr. Stanley Goldschmit, Esq.,
former counsel to Defendants, and Mr. Richard Schimel, Esq.,
successor counsel, must each "file affidavits attesting that they
do not have the Fischer and Fischer Companies' documents that
were supplied in discovery and after conducting a diligent search
to include agents and their representatives, they have been
unable to locate the same." Id. at 1. Asserting that Plaintiff
was unilaterally altering this Court's August 17, 2004 Order and
imposing additional requirements, Defendants immediately objected
to Plaintiff's actions and threatened a motion for sanctions on
their own. The Court was then forced to resolve this dispute
through another Memorandum Opinion and Order, dated December 1,
2004. In this Order, the Court required
that Plaintiff provide Defendants access to or copies
of all materials requested by Defendants which are
outlined in the Status Report filed on September 15,
2004. No affidavits are required from Defendant[s],
though Defendant[s] [are] under a continuing ethical
obligation to inform Plaintiff if any of these
materials requested are actually within their
possession. Plaintiff must give Defendants access to
or copies of these materials by no later than
Thursday, December 23, 2004, or [her] pending Motion
for Finding that Defendants and Their Prior Counsel,
Stanley Goldschmidt, Esquire, Attempted to Perpetrate
a Fraud Against this Court and for Appropriate
Sanctions will be denied by the Court. The previous
scheme created by the Court's August 17, 2004,
Opinion and Order, which provided compensation for
Plaintiff's counsel and staff for preparing the
documents and copying them, will remain in place.
Atkins v. Fischer, Civ. No. 98-800, at 13-14 (D.D.C. Dec. 1,
2004) (order denying Plaintiff's Motion for Clarification)
(emphasis in original).
The Court's December 1, 2004 Opinion and Order, which
constituted a global resolution of all pending production-related
disputes, apparently had the intended impact, as separate Status
Reports filed by both Plaintiff and Defendants on January 6th and
7th, 2005, indicated that Defendants were ultimately provided the
necessary requested materials. The Court then entered a briefing
schedule to complete the briefing of Plaintiff's Motion for
Sanctions; Defendants filed their Opposition on February 7, 2005,
while Plaintiff filed her Reply on February 21, 2005. At the same
time that the production-related disputes were reaching a
simmering point in this case, Defendants former counsel, Mr.
Stanley H. Goldschmidt, Esq., filed a cross-motion for sanctions
against Plaintiff on August 31, 2004, and Plaintiff filed an
Opposition to that motion on September 13, 2004. The Court stayed
consideration of that motion until it could resolve Plaintiff's
Motion for Sanctions concurrently. Given that Plaintiff's Motion
for Sanctions is now fully briefed, nearly one (1) year after it
was initially filed, the Court can resolve both fully briefed sanctions-related motions.
B. Factual Context of the Sanctions-Based Motions
Plaintiff's Motion for Sanctions, now fully ripe, asserts that
"there is compelling reason to believe that Plaintiff Benson
Fischer ("Fischer") and his former attorney, Stanley Goldschmidt,
Esq., attempted to perpetrate a fraud upon this Court by
fabricating evidence and hiding material evidence during
discovery which, among other things, would have precluded this
Court's grant of summary judgment." Pl.'s Mot. for Sanctions at
1. According to Plaintiff, absent Defendants' fraud, "Plaintiff's
appeal would have been unnecessary." Id. As such, Plaintiff
contends that "[a]n award of appropriate sanctions to include
entry of default judgment, an award of substantial attorneys'
fees, and referral of Mr. Fischer's conduct to the United States
Attorney's Office is in order." Id.
Plaintiff's argument for the draconian sanction of default
judgment rests upon four (4) major contentions.
1. History of Misconduct in Contemporaneous, Related
First, Plaintiff cites to the "history of misconduct" by Mr.
Fischer and his former attorney, Mr. Goldschmidt, "in other
contemporaneous litigation." Id. at 4. Plaintiff points to two
different cases, coetaneous to this case, in which Messrs.
Fischer and Goldschmidt were sanctioned for misconduct: (1)
Fischer Brewing Co. v. Flax, Superior Court of the District of
Columbia, Civ. No. 678-97, aff'd, Fischer v. Estate of Howard L.
Flax, 816 A.2d 1 (2003); and (2) In re Fischer, United States
Bankruptcy Court of the District of Maryland, Case No.
03-13704-DK. Id. at 4, 9. The Fischer v. Flax litigation
dealt with a breach of contract lawsuit by Mr. Fischer against
(1) Mr. Howard Flax, who signed an agreement with Mr. Fischer
providing for a substantial finder's fee if Mr. Flax was able to locate
financing for the Fischer Brewing Company and Redneck Beer, and
(2) the law firm representing Mr. Flax, Paley Rothman. Id. at
4-5. During the Fischer v. Flax litigation, Superior Court
Judge Steffen W. Graae, after a bench trial on the "bad faith
litigation" counterclaim, sanctioned Mr. Fischer for almost
$930,000.00 in attorney's fees and costs for bad faith litigation
and $40,000.00 in punitive damages. Pl.'s Reply at 1-2. Judge
Graae concluded that Mr. Fischer's suit "rests on false
allegations, fraudulent documentation, and a stubborn refusal to
acknowledge wrongdoing, the suit represents the grossest kind of
abuse of the legal process." Id. at 2; Pl.'s Mot. for
Sanctions, Ex. 3 (May 3, 2000 Opinion and Order) at 23.
Specifically, Judge Graae found that "the evidence is clear and
convincing that Mr. Fischer knowingly constructed a fraudulent
suit against Flax and [his] lawyers," Pl.'s Mot. for Sanctions,
Ex. 3 (May 3, 2000 Opinion and Order) at 21. Judge Graae also
focused on the fact that Mr. Fischer's actions "raise[d]
questions about efforts he may have made to manipulate witnesses
and lawyers in this case," id. at 19-20. Finally, in his
separate award of punitive damages against Mr. Fischer, Judge
Graae found that "[i]t is obvious that an oath to tell the truth
means little or nothing to Mr. Fischer and that he is still
intent on manipulating the legal process." Pl.'s Mot. for
Sanctions, Ex. 5 (Dec. 18, 2000 Order and Judgment).
Judge Graae also awarded Rule 11 sanctions against Mr.
Goldschmidt, who represented Mr. Fischer in Fischer v. Flax,
and his co-counsel, Mr. Arthur Kahn, Esq., in the sum of
$50,000.00. Pl.'s Mot. for Sanctions, Ex. 6 (Dec. 2, 2003 Opinion
and Order). Judge Graae concluded that Mr. "Goldschmidt and Mr.
Kahn served as nothing more than mouthpieces for the threats Mr.
Fischer made. . . . Goldschmidt's and Mr. Kahn's pleadings may
have satisfied Mr. Fischer's thirst for vengeance, but they did not meet the legal
or factual standards contemplated by Rule 11." Id. at 11. Judge
Graae went on to find that "the Court considers the professional
conduct of Goldschmidt and Mr. Kahn to be well beyond the pale.
These two experienced lawyers knew, or had to know, they did not
have sufficient evidence to make a case for tortious interference
by Mr. Mark and his law firm, Paley Rothman. . . . The Court can
only characterize their conduct as willful and badly motivated."
Id. at 13-14. Plaintiff, in addition to focusing on Judge
Graae's sanctioning of Mr. Goldschmidt in Fischer v. Flax, also
focuses on the fact that Mr. Goldschmidt in attempting to
defend himself in that action claimed that he suffered from "a
state of mental intoxication and loss of impulse control and
judgment," Pl.'s Mot. for Sanctions, Ex. 7 (Statement from Mr.
Goldschmidt's medical doctor), due to "clinical depression and
drug induced intoxication," Pl.'s Mot. for Sanctions at 7.
Plaintiff emphasizes that "[i]t is of interest that Goldschmidt
claims that he suffered from clinical depression and drug induced
intoxication through the Fischer litigation which was also the
period of time that the instant litigation was pending before
this Court." Id. at 8. Plaintiff further stresses that Mr.
Goldschmidt, along with Mr. Fischer, was sanctioned once again
for another $30,000.00 after being found in contempt by the
Circuit Court for Montgomery County, Maryland, for stonewalling
collection-related discovery during post-judgment collection
efforts instigated by Paley Rothman. Pl.'s Mot. for Sanctions at
11-12; Pl.'s Reply at 3.
Following collection efforts, Mr. Fischer filed for personal
bankruptcy pursuant to Chapter 7 of the Bankruptcy Code. See In
re Fischer, United States Bankruptcy Court for the District of
Maryland, Case No. 03-13704-DK. Plaintiff contends that in his
bankruptcy case, Mr. "Fischer has engaged in the same pattern of
behavior that he displayed in the Fischer v. Flax litigation" by refusing "to appear for depositions when ordered"
and presenting "evidence in the Bankruptcy Court which he likely
fabricated after the fact." Pl.'s Mot. for Sanctions at 9. For
instance, in an Order dated March 12, 2004, Bankruptcy Judge Keir
granted sanctions to Plaintiff, a creditor in Mr. Fischer's
bankruptcy case, for Mr. Fischer's refusal to comply with a Court
order directing a FRBP 2004 examination; Judge Keir's Order also
provided for sanctions against Mr. Fischer's bankruptcy attorney,
Mr. Richard Rosenblatt. See Pl.'s Mot. for Sanctions, Ex. 12
(3/10/04 Tr. of Bankruptcy Court Hearing).
Plaintiff contends that the conduct of Messrs. Fischer and
Goldschmidt in litigation contemporaneous to this case must be
considered relevant by this Court in the resolution of
Plaintiff's present Motion for Sanctions. Essentially, Plaintiff
argues that Mr. Fischer and his lawyers, including former counsel
Mr. Goldschmidt, have exhibited a pattern of misconduct that
"constitutes chronic abuse of the legal standard." Pl.'s Reply at
10. Plaintiff describes the behavior by Defendants and their
counsel as "extraordinary by any standard" wherein "fabricating
documents, lying under oath, and using the legal system to
further personal vendettas is Fischer['s] modus operandi."
Pl.'s Mot. for Sanctions at 12. Plaintiff posits that it would
"blink? reality for this Court to ignore the extreme
misconduct," Pl.'s Reply at 8, as it is quite likely that Mr.
Fischer and Mr. Goldschmidt exhibited a similar pattern of
behavior in this case.
2. Withholding of Discovery in This Case
Second, Plaintiff cites to the alleged discovery abuses by
Defendants and their former counsel, Mr. Goldschmidt, in
suppressing material evidence in this case. Pl.'s Mot. for
Sanctions at 13; Pl.'s Reply at 11. Plaintiff focuses on three
(3) alleged instances of suppression of key evidence: (1) the
production of false gross revenues incurred during the sale of
Redneck Beer, which significantly underestimate the total sales of Redneck
Beer, Pl.'s Mot. for Sanctions at 13 & n. 10; (2) the apparent
withholding by Mr. Fischer and Mr. Goldschmidt of documents
showing that the Atkins' Logo was used in t-shirts produced and
sold under license and the actual samples of the t-shirts
themselves, id. at 13-20; and (3) the intentional suppression
of the "missing" documents in this case, subject to this Court's
discovery-related production orders requiring Plaintiff to share
certain documents with Defendants' new counsel, Pl.'s Reply at
Plaintiff alleges that income tax-related documents produced by
Defendants in this case stated that from 1995 through 1996 (the
period during which the Fischer Brewing Company sold Redneck
Beer), total sales amounted to roughly $1.5 million. Pl.'s Mot.
for Sanctions at 13. However, Plaintiff points to two different
Washington Post articles which apparently contradict this
figure. Id. at 13, n. 10. In the first article, Plaintiff
asserts that Mr. Fischer claims that over 375,000 cases of
Redneck Beer were sold; at $9.05 per case, Plaintiff estimates
that such sales would have produced revenues of $3.4 million. In
the second article, it is reported that Fischer Brewing "sold
almost 15 million bottles" of Redneck Beer; Plaintiff estimates
that at $9.05 per case, gross revenues would have been
approximately $5.7 million. Id. As such, Plaintiff implies that
Mr. Fischer and his former counsel, Mr. Goldschmidt, must be
hiding the true revenues related to Redneck Beer. Id.
However, Plaintiff spends most of her argument on the
allegation that Mr. Fischer and Mr. Goldschmidt withheld key
evidence that Atkins' Logo was used in t-shirts produced and sold
under license pursuant to a November 15, 1995 agreement between
the Fischer Brewing Company and Cambridge Sportswear, Inc. Id.
at 13-20. In this agreement, Cambridge Sportswear provided the
Fischer Brewing Company a $100,000.00 initial royalty fee in
order to possess the exclusive license to produce Redneck Beer-branded
clothing and wearing apparel. Id. at 14. According to
Plaintiff, during Plaintiff's examination of Mr. Fischer in the
In re Fischer bankruptcy case, Mr. Fischer maintained that this
contract was "to license the name Redneck beer. Specifically the
name, nothing else." Id. at 14 (citing 1/19/04 Fischer Dep. at
41). Indeed, Plaintiff contends that "[a]t no time did Fischer or
Goldschmidt ever produce T-shirts or other clothing made by
Cambridge under license in discovery in this case." Id.
However, in the Fischer v. Flax litigation, Mr. Fischer
produced a copy of a business plan which had been Bates stamped
LFB000369-LFB000579. Id. at 16. Unlike the business plan
produced in Flax, the business plan produced by Defendants in
this case "lacked the Cambridge T-shirt photographs confirming
Cambridge's reproduction on the T-shirts of the Atkins logo. Also
lacking were photos of a model with Redneck beer, a promotional
photo which included and made use of the Atkins Logos." Id. at
17. Plaintiff contends the omissions from the business plan were
deliberate, despite the protestations of Mr. Fischer and Mr.
Goldschmidt, because such information would have precluded this
Court's November 30, 2001 grant of summary judgment under an
implied non-exclusive license theory. Id. at 17-18.
Specifically, according to Plaintiff,
Fischer's licensing to Cambridge Sportswear of
Redneck Beer trademarked goods, including the Atkins
Logos for use on wearing apparel would not be within
any implied nonexclusive license to use the Atkins
Logos for commercial production and distribution of
beer. And, under no circumstances could Fischer grant
an exclusive license to Cambridge. An implied
license (which is all that Fischer could have had),
at best, is nonexclusive. Fischer could not grant
an exclusive license that he himself did not have.
Id. at 18 (emphasis in original). As such, given the importance
of this complete business plan and "the remarkable history of
prevarication" laid out by Plaintiff, Plaintiff asserts that
"Fischer and Goldschmidt cannot be heard to say that the failure
to produce key documents (and apparel samples) that were clearly in their possession was a simple
oversight." Id. at 20.
Finally, Plaintiff argues that Mr. Fischer and Mr. Goldschmidt
are continuing to hide documents related to this litigation.
Pl.'s Reply at 11-13. Specifically, Plaintiff contends that it is
the practice of Messrs. Fischer and Goldschmidt "to claim that
they do not have documents and to not produce documents," id.
at 11, and that practice has exhibited itself with respect to the
very documents subject to this Court's production-related orders
of August 17, 2004 and December 1, 2004. According to Plaintiff,
in a hearing held before the Bankruptcy Court on October 20,
2004, Mr. Fischer stated to the court that Mr. Goldschmidt
retains one hundred (100) to two hundred (200) boxes of his
business files, and indicated through counsel that he has tried
unsuccessfully to obtain the documents from Mr. Goldschmidt.
Id. at 12 (citing Pl.'s Reply, Ex. B (Oct. 20, 2004 Bankruptcy
Court Tr. at 70-71). Plaintiff speculates that these boxes
contain even more material than was copied by Defendants'
successor counsel in this case from Plaintiff's files pursuant to
the Court's Orders, and suggests that Mr. Goldschmidt who has
been held in contempt in Montgomery County, Maryland, for failing
to produce documents has failed to produce these documents in
order to cover up his own misconduct. Id. at 11-12 & n. 15.
Plaintiff concludes by stating that "[w]e have absolutely no
doubt that the allegedly missing Fischer documents can be found
(or recreated from) the 200 boxes and that Messrs. Fischer and
Goldschmidt have, yet again, played games with this Court and
with everyone else in this case." Id. at 13.
3. Fischer's Alleged Fabrication of a Fake Mock-Up Bottle
Third, Plaintiff asserts that evidence has come to light that
indicates Mr. Fischer fabricated a mock-up, or prototype, bottle
of Redneck Beer featuring the original concept of a red bandana and denim pocket in an attempt to support his claims that
he and not Plaintiff is entitled to the copyright of the
relevant design. Pl.'s Mot. for Sanctions at 20. During the
earlier round of dispositive motions, Defendants had alleged that
Mr. Fischer, prior to meeting Plaintiff, had constructed a
mock-up Redneck Beer bottle, using a Budweiser beer bottle, in
order to demonstrate his concept of how the ultimate design
should look; Defendants also argued that Mr. Fischer had also
created some preliminary sketches highlighting his design ideas.
See Atkins v. Fischer, Civ. No. 98-800, at 11-12 (D.D.C. Nov.
30, 2001). The Court rejected Defendants' argument, given Mr.
Fischer's vague and inconclusive testimony regarding whether he
actually showed Plaintiff the alleged mock-up bottle and
sketches, and given the unequivocal testimony by both Plaintiff
and Mr. Thomas Gaadt (the artist hired by Plaintiff to sketch the
Atkins designs) that they never saw the mock-up bottle. Id.
Despite the fact that the Court rejected Defendants' mock-up
bottle claim as a matter of law, Plaintiff continues to focus on
the importance of the mock-up bottle which has long been the
subject of major discovery disputes. Essentially, Plaintiff
maintains that the mock-up bottle was created after the fact by
Mr. Fischer in order to evade Plaintiff's claims. To support this
argument, Plaintiff contends: (1) contrary to Mr. Fischer's
deposition testimony, see 4/3/00 Fischer Dep. at 388, the
mock-up bottle as confirmed by Anheuser Busch Company through
an analysis of a picture of the mock-up bottle was not a
Budweiser beer bottle at all, as the mock-up bottle was of a
clear color, see Pl.'s Mot. for Sanctions at 23-24 (citing
7/28/00 Dep. of Mark Elliott, Senior Manager in the Packaging
Technology Group for Anheuser Busch); (2) the refusal by
Plaintiff's former counsel, Mr. Goldschmidt, to hand over the
actual bottle for further testing leads to an inference that
Defendants were aware that the bottle was created ex post
facto, and sought to hide that fact, id. at 24-25; (3) virtually all
testimony in this case indicates that no one was shown the
mock-up bottle by Mr. Fischer, contrary to his assertions, id.
at 22 (citing to the fact that only Mr. Harvey Berkman and Mr.
Steve Solomon testfied that they ever saw the mock-up bottle, and
arguing that their testimony was vague), Pl.'s Reply at 25-28;
and (4) Plaintiff's review of standard bottle markings in the
United States, assisted by an expert witness with experience in
the glass industry (Mr. C. Phillip Ross), indicates that the
numbers engrossed on the mock-up bottle "96 and a symbol that
looks like a B and then the number 9934 and then the number 2,"
Pl.'s Reply at 29 has led her to "believe that the symbol `96'
on the mock-up bottle refers to the year of manufacture of that
bottle," id., ensuring that the mock-up was created long after
Mr. Fischer held discussions with Plaintiff regarding design
Plaintiff contends that the "fabricated" mock-up bottle had a
significant impact on this litigation. According to Plaintiff,
"[t]he vast majority of discovery conducted by the Plaintiff from
1999 until 2001 was the result of the concocted Mock-up Bottle
defense." Pl.'s Mot. for Sanctions at 26. Moreover, Mr.
"Fischer's lies and fabrication converted a straightforward
copyright infringement case into a case where a major issue in
discovery was whose copyright it is." Id. Plaintiff avers that
this kind of behavior by Mr. Fischer is similar to his actions
taken in the Fischer v. Flax litigation, and that default
judgment is the required sanction for such malfeasance. Id.;
Pl.'s Reply at 30.
4. Defendants' Counterclaims Were Filed in Bad Faith and
Without a Legal or Factual Basis
Fourth, and finally, similar to the Fischer v. Flax
litigation, wherein Judge Graae expressly found that Mr.
Fischer's claims against Mr. Flax were without legal or factual
basis or proper investigation, Plaintiff contends that Defendants'
counterclaims in this case were filed without legal or factual
basis. See Pl.'s Mot. for Sanctions at 26-27. Defendants filed
four (4) counterclaims in this case: (1) breach of contract; (2)
tortious interference with business relations; (3) infringement
of trademark; and (4) infringement of the trademark. See
generally Defs.' Ans. Defendants' counterclaims were filed over
seven years ago and Plaintiff's previous counsel never filed a
Motion for Rule 11 Sanctions at that time. After Defendants'
filed their counterclaims, Plaintiff brought a Motion to Dismiss
those claims; this Court granted Plaintiff's motion as to
Counterclaim I (breach of contract), but denied the motion as to
the remaining counterclaims. The remaining three (3)
counterclaims were ultimately dismissed by Defendants'
stipulation on September 26, 2000. Despite these facts, ...