Id. at 55 (citations omitted). The Second Circuit declined to address either the district court's application of the forum non conveniens factors or its determination that British Airways was not a necessary party. Id.
On October 28, 1992, this case was reassigned from Judge Edelstein to Judge Kram. Subsequently, defendants moved: (1) to dismiss the complaint for lack of personal jurisdiction; (2) for an order dismissing plaintiffs' contempt claim, pursuant to Rule 56 of the Federal Rules of Civil Procedure; and (3) for reaffirmation of Scottish Air II, dismissing the balance of this action on the ground of forum non conveniens and denying plaintiffs leave to file a Second Amended Complaint and to add British Airways as a party. In response, plaintiffs moved: (1) for leave to file a Third Amended and Supplemental Complaint, pursuant to Rules 19 and 25(c) of the Federal Rules of Civil procedure; (2) for leave to add British Airways as a necessary and indispensable party, pursuant to Federal Rules of Civil Procedure 15(a) and (d) ; (3) for an order rescinding Judge Edelstein's December 16, 1991 Order prohibiting further discovery; and (4) for an order adjourning consideration of defendants' motion to dismiss on the grounds that it is directed to the First Amended Complaint, and will become moot with the filing of the proposed Third Amended and Supplemental Complaint.
By Memorandum Opinion and Order dated December 6, 1993, the Court denied: (1) defendants' motion to dismiss for lack of personal jurisdiction; (2) plaintiffs' motion for leave to file a Third Amended and Supplemental Complaint; (3) plaintiffs' motion to add British Airways as a necessary and indispensable party; and (4) plaintiffs' motion to adjourn consideration of defendants' motion for summary judgment. The Court stayed defendants' motion for reaffirmation of Judge Edelstein's December 4, 1990 Amended Opinion and Order dismissing this case on the ground of forum non conveniens pending resolution of plaintiffs' contempt claim.
III. The Present Action
Presently before the Court is defendants' motion for summary judgment dismissing plaintiffs' contempt claim. Plaintiffs allege that defendants violated the 1966 Settlement Agreement by failing to allow SAI to nominate an individual to serve on the board of directors of BCG after Vidockler's removal in 1985. Plaintiffs argue further that defendants' violation of the 1966 Settlement Agreement constitutes civil contempt due to the fact that the 1966 Settlement Agreement was "So Ordered" by this Court.
Defendants now argue that the 1966 Settlement Agreement does not obligate them to permit SAI to nominate a director to the board of BCG. Rather, according to defendants, the 1966 Settlement Agreement provides only that SAI be permitted to nominate an individual to the board of CAP. For the reasons that follow, defendants' motion is granted.
I. Standard of Law
Pursuant to Rule 56 of the Federal Rules of Civil Procedure, summary judgment is appropriate where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact, Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 26 L. Ed. 2d 142, 90 S. Ct. 1598 (1970), and may discharge this burden by demonstrating to the Court that there is an absence of evidence to support the nonmoving party's case on which that party would have the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). The nonmoving party then has the burden of coming forward with "specific facts showing that there is a genuine issue for trial," Fed. R. Civ. P. 56(e), by "a showing sufficient to establish the existence of [every] element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. at 322.
The Court "must resolve all ambiguities and draw all reasonable inferences in favor of the party defending against the motion." Lopez v. S.B. Thomas, Inc., 831 F.2d 1184, 1187 (2d Cir. 1987); Eastway Constr. Corp. v. New York, 762 F.2d 243, 249 (2d Cir. 1985); see also Adickes v. S.H. Kress & Co., 398 U.S. at 158-59; Gallo v. Prudential Residential Serv., 22 F.3d 1219, 1223 (2d Cir. 1994). But the Court must inquire whether "there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party," Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986), and grant summary judgment where the nonmovant's evidence is merely colorable, conclusory, speculative or not significantly probative. Id. at 249-50; see Knight v. United States Fire Ins. Co., 804 F.2d 9, 12-15 (2d Cir. 1986), cert. denied, 480 U.S. 932, 94 L. Ed. 2d 762, 107 S. Ct. 1570 (1987); Argus Inc. v. Eastman Kodak Co., 801 F.2d 38, 45 (2d Cir. 1986), cert. denied, 479 U.S. 1088, 94 L. Ed. 2d 151, 107 S. Ct. 1295 (1987). The nonmovant must "do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 89 L. Ed. 2d 538, 106 S. Ct. 1348 (1986).
To determine whether the moving party has met his or her burden, the Court must focus on both the materiality and the genuineness of the factual issues raised by the nonmovant. As to materiality, "it is the substantive law's identification of which facts are critical and which facts are irrelevant that governs." Anderson v. Liberty Lobby, 477 U.S. at 248. A dispute over irrelevant or unnecessary facts will not preclude summary judgment, id., but the presence of unresolved factual issues that are material to the outcome of the litigation mandates a denial of summary judgment. See, e.g., Knight v. United States Fire Ins. Co., 804 F.2d at 11-12.
Once the nonmoving party has successfully met the burden of establishing the existence of a genuine dispute as to an issue of material fact, summary judgment must be denied unless the moving party comes forward with additional evidence sufficient to establish his or her burden under Rule 56. Celotex Corp. v. Catrett, 477 U.S. at 330 & n.2 (Brennan, J., dissenting). In sum, if the Court determines that "the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no 'genuine issue for trial.'" Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. at 587 (quoting First Nat'l Bank of Arizona v. Cities Serv. Co., 391 U.S. 253, 289, 20 L. Ed. 2d 569, 88 S. Ct. 1575 (1968)).
II. Plaintiffs' Contempt Claim
Plaintiffs contend that BCG should be held in contempt for refusing to permit SAI to nominate a director to BCG's board. Plaintiffs first argue that, as the "So Ordered" 1966 Settlement Agreement was amended to give SAI the right to nominate a director to the board of AIT, the Court's consent decree should encompass this amendment. According to plaintiffs, AIT was therefore obligated to permit them to nominate a director to AIT's board. Plaintiffs argue further that, as BCG assumed the functions of AIT and CAP, the 1966 Settlement Agreement should be read to obligate BCG to allow them to nominate a member to its board as well. According to plaintiffs, BCG's refusal to allow SAI to choose a board member subjects it to a civil contempt sanction. The Court finds this argument unpersuasive.
"The imposition of a civil contempt order is a severe sanction subject to a higher standard of proof than the 'preponderance of the evidence' standard applicable to ordinary civil cases." King v. Allied Vision, Ltd., 155 F.R.D. 440, 448 (S.D.N.Y. 1994) (quoting Hart Schaffner & Marx v. Alexander's Dep't Stores, Inc., 341 F.2d 101, 102 (2d Cir. 1965)). Rather, the burden of proof is a "clear and convincing" standard. New York State Nat'l Org. For Women v. Terry, 886 F.2d 1339, 1351 (2d Cir. 1989). Thus, a court's inherent power to hold a party in civil contempt should be exercised only when (1) the order the party allegedly failed to comply with is clear and unambiguous; (2) the proof of noncompliance is clear and convincing; and (3) the party has not diligently attempted in a reasonable manner to comply. Id.
Consent decrees are utilized by parties "to save themselves time, expense, and inevitable risk of litigation." United States v. Armour & Co., 402 U.S. 673, 681, 29 L. Ed. 2d 256, 91 S. Ct. 1752 (1971). As consent decrees are "hybrid in the sense that they are both contracts and orders, they are construed largely as contracts, but are enforced as orders." Berger v. Heckler, 771 F.2d 1556, 1567-68 (2d Cir. 1985). Accordingly, courts should defer to the language of the consent decree, discerning its meaning "within its four corners, and not by reference to what might satisfy the purposes of one of the parties to it." United States v. Armour & Co., 402 U.S. at 682; see also Crumpton v. Bridgeport Educ. Ass'n, 993 F.2d 1023, 1028 (2d Cir. 1993) (stating that, in interpreting a consent decree, courts are bound by the "four corners" of the document); United States v. O'Rourke, 943 F.2d 180, 187 (2d Cir. 1991) (same); Berger v. Heckler, 771 F.2d at 1568 (stating that courts are "not entitled to expand or contract the agreement of the parties as set forth in the consent decree").
While BCG may be held in contempt for violating a consent decree entered into by itself and another party, the Court finds that BCG may not be held in contempt for violating the 1966 Settlement Agreement in the present case. In fact, the 1966 Settlement Agreement, as "So Ordered" by this Court, requires only that SAI be permitted to nominate a member to the board of CAP. Although parties are free to modify their agreements, the Court will not hold a party in contempt for failing to abide by an agreement that was made subsequent to the entering of the Court's consent decree. A finding of civil contempt is a serious sanction and is inappropriate in the context of supplemental agreements to which the Court is not privy.
Moreover, even if the Court were to determine that the amendment to the 1966 Settlement Agreement, permitting SAI to nominate a board member of AIT, falls within the scope of the consent decree, the Court finds that the consent decree as amended does not give SAI the right to nominate a member to the board of BCG.
Plaintiffs maintain that, as BCG assumed functions that previously had been fulfilled by both AIT and CAP prior to the 1970 corporate reorganization, BCG must now permit SAI to nominate a board member. The Court disagrees. The Court will not inquire beyond the obvious language agreed to by the parties or hold defendants accountable for plaintiffs' hidden intent in executing the 1966 Settlement Agreement. See United States v. Int'l Bhd. of Teamsters, 899 F.2d 143, 146 (2d Cir. 1990) (stating that "an unclear order provides insufficient notice to justify a sanction as harsh as contempt"). While the 1966 Settlement Agreement as amended permits plaintiffs to nominate a director to the boards of CAP and AIT, it does not provide for nomination to the boards of successive corporate entities. As CAP, AIT and BCG are separate and distinct enterprises, BCG is not obligated to permit SAI to nominate a director to its board absent language in the 1966 Settlement Agreement allowing for nomination to the boards of future distinct corporate bodies. Accordingly, the Court finds that plaintiffs have failed to present clear and convincing evidence that defendants violated the Court's consent decree by refusing to allow plaintiffs to appoint a member of BCG's board of directors.
Moreover, the Court finds that further discovery is unnecessary to the disposition of plaintiffs' civil contempt claim. Plaintiffs argue that additional discovery may shed light on the parties' underlying intentions and the meanings of certain terms, such as "CAP," in the 1966 Settlement Agreement. Plaintiffs' position is without merit. While it is true that the Court applies standard principles of contract interpretation in construing a consent decree, including examining the technical meaning of words and surrounding circumstances, such an analysis would not aid plaintiffs in the present case. "Extrinsic evidence . . . may generally be considered only if the terms of the [document] are ambiguous." S.E.C. v. Levine, 881 F.2d 1165, 1179 (2d Cir. 1989). Here, the 1966 Settlement Agreement is unambiguous in conferring upon SAI the right to nominate a director only to the board of CAP. The Court will not examine outside circumstances to provide new meaning to the clear terms of the 1966 Settlement Agreement.
For the reasons set forth above, defendants' motion, pursuant to Rule 56 of the Federal Rules of Civil Procedure, for summary judgment dismissing plaintiffs' contempt claim is granted. Plaintiffs' cross-motion, pursuant to Rule 56(f) of the Federal Rules of Civil Procedure, for an order permitting additional discovery before ruling on defendants' motion is denied. The parties are directed to brief defendants' motion to reinstate Judge Edelstein's December 4, 1990 Amended Opinion and Order dismissing the case on the ground of forum non conveniens pursuant to the following schedule: (1) defendants' motion papers are due on December 9, 1994; (2) plaintiffs' opposition papers are due on December 23, 1994; and (3) defendants' reply papers are due on December 30, 1994.
SHIRLEY WOHL KRAM
UNITED STATES DISTRICT JUDGE
Dated: New York, New York
November 10, 1994