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Guantanamera Cigar Co. v. Corporacion Habanos

November 5, 2010

GUANTANAMERA CIGAR CO., PLAINTIFF,
v.
CORPORACION HABANOS, S.A., DEFENDANT.



The opinion of the court was delivered by: Royce C. Lamberth, Chief Judge

MEMORANDUM AND ORDER

On August 5, 2010, this Court ordered, inter alia, that plaintiff show cause within ten days of the order "as to why it should not be held in civil contempt for violating the Court's order [71] Dec. 10, 2009." (Order at 1, Aug. 5, 2010, ECF No. 136.) Plaintiff filed its response to the Court's order on August 16 (ECF No. 138), and defendant replied to plaintiff's response on September 2 (ECF No. 141).

This show cause order stemmed from two pending motions: (1) Plaintiff's Motion for Enlargement of Time to Comply with the Court's December 10, 2009 Order, or Aletrnatively [sic] Relief from and Modification of the Order (Apr. 1, 2010, ECF No. 82), and (2) Defendant's Motion for Civil Contempt and for Sanctions (Apr. 9, 2010, ECF No. 107).

Upon consideration of Defendant's Motion for Civil Contempt and for Sanctions (ECF No. 107), the opposition thereto (ECF No. 112), and the reply brief (Notice of Filing, ECF No. 121), the Court will grant the motion for the reasons stated below.

Upon consideration of Plaintiff's Motion for Enlargement of Time to Comply with the Court's December 10, 2009 Order, or Aletrnatively [sic] Relief from and Modification of the Order (ECF No. 82); the opposition thereto (ECF No. 107), and reply brief (ECF No. 112), the Court will deny the motion for the reasons stated below.

Based upon the representations in all of these motions, and both parties' responses to the Court's show cause order, the Court will hold plaintiff in civil contempt and order plaintiff to pay the remaining balance of the sanction forthwith. Furthermore, if plaintiff does not file proof of compliance with this order in thirty days, the Court will dismiss this case and vacate its previous summary judgment order (ECF No. 136).

I.BACKGROUND

The Court set out the facts of this case in more detail in its August 5 order, so the Court will repeat only the relevant facts here. On August 18, 2009, the Court granted defendant's Motion to Preclude, to Compel and for Sanctions (ECF No. 19), ordering plaintiff to pay "defendant's reasonable expenses for depositions of up to 15 of the listed witnesses, up to $500 per deposition," and to "pay defendant's reasonable attorney's fees and costs for bringing this motion." (Order at 2--3, Aug. 18, 2009, ECF No. 49.) The Court later ordered that reasonable attorney's fees consisted of "$16,615.00 plus $439.79 in expenses," thus totaling $17,054.79. (Order at 1, Dec. 10, 2009, ECF No. 71.) The Court conditioned payment on approval by the Office of Foreign Assets Control of the United States Department of Treasury (OFAC) and set the deadline for payment at thirty days after the defendant filed notice of OFAC approval. (Id.) Defendant filed notice of OFAC's approval on March 1, 2010, giving the plaintiff until March 31, 2010, to tender payment. (Def.'s Notice at 1, Mar. 1, 2010, ECF No. 78.) In this notice, defendant indicated that plaintiff was also responsible for payment of $1,000 for the costs associated with two depositions. (Id. at 2.) In total, plaintiff was thus responsible for paying $18,054.79 to defendant.

On March 31, defendant's counsel received a personal check from plaintiff's counsel in the amount of $5,000. (Def.'s Mot. for Civil Contempt at 5, Apr. 9, 2010, ECF No. 107.) On April 1, plaintiff filed a Motion for Enlargement of Time to Comply with the Court's December 10, 2009 Order, or Aletrnatively [sic] Relief from and Modification of the Order. (Apr. 1, 2010, ECF No. 82.) The motion proposed a payment plan consisting of four equal monthly payments of $2,600 and a final payment of $2,654.79, which would pay off the remaining $13,054.79 balance. (Id. at 2.) On April 9, defendant filed a Motion for Civil Contempt and for Sanctions. (Apr. 9, 2010, ECF No. 107.)

Since this time, despite tailoring a custom payment plan, plaintiff has failed to make any monthly payments. (Def.'s Reply Mem. Supp. Mot. Civil Contempt at 2.) In its Court-ordered response, plaintiff now concedes its failure to make any payments and proposes a new payment plan, which would consist of payments of "the remaining balance in 10 equal monthly installments with the first one being September 1, 2010." (Aug. 18, 2010, ECF No. 138.) In its September 2 filing, defendant did not indicate whether plaintiff had paid the promised September 1 installment. (Def.'s Opp'n, Sept. 2, 2010, ECF No. 141.) In the absence of any filings indicating that plaintiff has begun making payments, the Court must assume that plaintiff has not yet made a payment. Furthermore, on October 18, counsel for defendant orally confirmed that plaintiff has not made a payment since March.

II. LEGAL STANDARD

"[C]courts have the inherent power to enforce compliance with their lawful orders through civil contempt." Shillitani v. United States, 384 U.S. 364, 370 (1966); see also Broderick v. Donaldson, 437 F.3d 1226, 1234 (D.C. Cir. 2006). This power is "essential to the enforcement of the judgments [and] orders . . . of the courts," Broderick, 437 F.3d at 1234 (citations omitted), and it includes enforcement of Court-imposed deadlines, In re Fannie Mae Sec. Litig., 552 F.3d 814, 823 (D.C. Cir. 2009).

The sole purpose of civil contempt sanctions is to "coerce compliance or compensate a complainant for losses sustained," not to punish. Fannie Mae, 552 F.3d at 823. "Although one may be held in civil contempt for refusing to comply with a court order, a sanction for one's past failure to comply with an order is criminal in nature." Cobell v. Norton, 334 F.3d 1128, 1146--47 (D.C. Cir. 2003).

To satisfy the requirements of contempt, the contemnor must have "violated an order that is clear and unambiguous," and the movant must prove the violation "by clear and convincing evidence." Broderick, 437 F.3d at 1234. "[C]ontempt may be inappropriate when a party in ...


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