To comply with the 1994 Order and determine the number of nonconformed copies in the distribution stream, defendant retained a mass mailing service to effectuate the distribution of an inventory report form to 25,334 video retailers and 226 video wholesalers and distributors (the "third mailing"), which would be filled out and returned to defendant. 877 F. Supp. at 187. After return of the completed form, defendant planned to have the service distribute the appropriate number of corrective sleeves or stickers to each responding entity (the "fourth mailing"). Id . Regretfully, a minority of the retailers, wholesalers and distributors responded. Id. at 188. Defendant sent the fourth mailing only to the responding entities, ignoring the fact that a vast majority of the retailers, wholesalers and distributors had not responded and thus would not receive an amount of corrective packaging corresponding to their inventory. Id. Under the 1994 Order, plaintiff was permitted to conduct a compliance investigation, which revealed that a majority of the videocassette packages in the distribution stream observed still bore the banned references to plaintiff. Id. at 189.
Accordingly, plaintiff moved again for contempt before this court and defendant was found in violation of both the Decree and the 1994 Order. The court ordered defendant to use certified mail to contact those entities that had not responded to the third mailing to determine if they had sufficient corrective packaging. If correspondence by certified mail did not elicit a response, defendant was directed to contact them by phone. Id. at 191.
Defendant appealed both the 1994 and 1995 Orders. Upon review, the Court of Appeals affirmed substantial portions of the 1994 Order but determined that certain elements of the 1994 Order were overreaching in that they imposed obligations on defendant that exceeded the terms of the original agreement between the parties and thus could not serve as the basis for the sanction of contempt. 65 F.3d at 1060-61. Because the 1995 Order was based on defendant's failure to comply with those portions of the 1994 Order the Court of Appeals considered overbroad, the 1995 Order was vacated in its entirety.
The Court of Appeals remanded the proceedings to this court.
On December 5, 1995, while the parties were trying to resolve any outstanding disputes between them, the court held a conference with counsel for the parties and directed each to submit proposed findings of fact and conclusions of law on the issue of attorney's fees alone. (Order, dated December 5, 1995, at 1-2.)
On January 29, 1996, except for plaintiff's request for attorney's fees, the parties settled all other elements of the underlying contempt proceedings. (See Consent Order, dated January 29, 1996.)
"The ability to punish disobedience to judicial orders is regarded as essential to ensuring that the Judiciary has a means to vindicate its own authority without complete dependence on other Branches." Young v. United States ex rel. Vuitton et Fils, S.A., 481 U.S. 787, 796 (1987).
Generally, contempt sanctions can be criminal or civil in nature and each of these forms have their own purposes and their own specific characteristics. Distinguishing between these two types of contempt is found through an "examination of the character of the relief itself." Hicks v. Feiock, 485 U.S. 624, 636, 99 L. Ed. 2d 721, 108 S. Ct. 1423 (1988).
Criminal contempt sanctions are punitive in nature imposed to "vindicate the authority of the court." Gompers v. Bucks Stove & Range Co., 221 U.S. 418, 441, 55 L. Ed. 797, 31 S. Ct. 492 (1911). To support a finding of criminal contempt, it must be shown beyond a reasonable doubt that the contemnor willfully violated "'specific and definite terms of a court order.'" United States v. Paccione, 964 F.2d 1269, 1274 (2d Cir. 1992) (citation omitted).
A punishment for civil contempt "coerce[s] the defendant into compliance with the court's order, [or] . . . compensate[s] the complainant for losses sustained." United States v. United Mine Workers of America, 330 U.S. 258, 303-304, 91 L. Ed. 884, 67 S. Ct. 677 (1947) (citation omitted); see also, United Mine Workers v. Bagwell, U.S. , 114 S. Ct. 2252, 2558, 129 L. Ed. 2d 642 (1994). Civil contempt proceedings are subject to a higher standard of proof than the "preponderance of the evidence" standard applicable to ordinary civil cases, Hart Schaffner & Marx v. Alexander's Department Stores, Inc., 341 F.2d 101, 102 (2d Cir. 1965), and the complaining party must show proof of noncompliance by clear and convincing evidence. New York State Nat'l Org. for Women v. Terry, 886 F.2d 1339, 1351 (2d Cir. 1989), cert. denied, 495 U.S. 947, 109 L. Ed. 2d 532, 110 S. Ct. 2206 (1990). A court may find a party in civil contempt only if the complainant proves: 1) the existence of a clear and unambiguous order
; 2) that the contemnor has not complied with the order; and, 3) that the contemnor has not been "'reasonably diligent and energetic in attempting to accomplish what was ordered.'" Drywall Tapers, Local 1974 v. Local 530, 889 F.2d 389, 394 (2d Cir. 1989) (quoting Powell v. Ward, 643 F.2d 924, 931 (2d Cir.), cert. denied, 454 U.S. 832, 70 L. Ed. 2d 111, 102 S. Ct. 131 (1981)), cert. denied, 494 U.S. 1030 (1990); see also, United States v. Local 1804-1. Int'l Longshoremen's Ass'n, 44 F.3d 1091, 1096 (2d Cir. 1995). The complaining party need not show that the contemnor's actions were willful for there to be a finding of civil contempt, however. Canterbury Belts Ltd. v. Lane Walker Rudkin, Ltd, 869 F.2d 34, 39 (2d Cir. 1989).
Although the purpose of civil contempt is to compensate a party for the contemnor's actions, the Second Circuit has determined that the contempt had to have been willful in order for the victorious party to receive attorney's fees for the cost of prosecuting the contempt. Manhattan Indus., Inc. v. Sweater Bee By Banff, Ltd., 885 F.2d 1, 8 (2d Cir. 1989), cert. denied, 494 U.S. 1029 (1990); Vuitton et Fils S.A. v. Carousel Handbags, 592 F.2d 126, 130 (2d Cir. 1979); cf. Sizzler Family Steak Houses v. Western Sizzlin Steak House, Inc., 793 F.2d 1529, 1535 (11th Cir. 1986) (holding willfulness not a requirement for an award attorney's fees but rather an element to be considered when determining their propriety). As with the elements of civil contempt generally, the complaining party must show by clear and convincing evidence that the contemnor's actions were willful for there to be an award of attorney's fees for prosecuting the contempt. Pearlman v. Bouchard, 1992 U.S. Dist. LEXIS 7701, 92 Civ. 1803, 1992 WL 125542, *3 (S.D.N.Y. May 28, 1992).
Twenty years ago, this court noted the "troublesome" nature of determining what constitutes willful disobedience of a court order. Andre Matenciot. Inc. v. David & Dash. Inc., 422 F. Supp. 1199, 1211 (S.D.N.Y. 1976). In Andre Matenciot, the contemnor was found guilty of willfully violating a court order because it had the capacity to comply with the order, had not acted in good faith to comply therewith, and had not moved to vacate or modify the order prior to the alleged contumacious acts. 422 F. Supp. at 1211. Other courts have proffered the same or similar definitions of willfulness. See, e.g., Sizzler Family Steak Houses, 793 F.2d at 1535 (finding "Willfulness generally connotes intentional action taken with at least callous indifference for the consequences.") (citation omitted); EEOC v. Local 638 . . . Local 28 Sheet Metal Workers' Int'l Assoc'n, 889 F. Supp. 642, 670-671 (S.D.N.Y. 1995) (holding "contempt is willful where the contemnor had actual notice of the court's order, [citing Vuitton et Fils S.A., supra, 592 F.2d at 131], was able to comply with it, did not seek to have it modified, and did not make a good faith effort to comply [citing Andre Matenciot, supra)."; cf. Upjohn Co. v. Medtron Laboratories, Inc. 894 F. Supp. 126, 135 (S.D.N.Y. 1995) (without setting forth standard for willfulness, holding that actions were willful where contemnor in civil contempt proceeding "willfully . . . sought to evade the Court's authority through an illusive trail of feigned ignorance, faulty recordkeeping, questionable documentation and hidden [transactions]").
With this "troublesome" standard in mind, the court must consider plaintiff's renewed request for attorney's fees.
II. PLAINTIFF'S RENEWED REQUEST FOR ATTORNEY'S FEES.
A. The Remand of the Court of Appeals.
As stated above, the Court of Appeals found that upon review of this court's prior orders of contempt in this case defendant's actions did not appear willful, which would warrant the denial of the request for attorney's fees. Specifically, the court found as follows:
Although New Line may have been careless in attempting to comply with certain portions of the Decree and the 1994 Order, we are reluctant to conclude that the noncompliance was willful.
65 F.3d at 1063.
The court cited defendant's "substantial efforts to comply with both the Decree and 1994 Order by conducting four separate mailings in which it distributed hundreds of thousands of corrective stickers and sleeves" as evidence that its actions were not willful and considered defendant's "noncompliance in light of the ambiguous portions of the Decree, including the uncertainty as to which entities were to receive corrective materials." Id.
Accordingly, the following discussion is informed by these observations.
B. Plaintiff's Allegations Concerning Willfulness.
On the renewed request for attorney's fees, plaintiff cites six specific instances of contemptuous conduct that, it is argued, reveal the willful nature of defendant's actions. (See Pl. Prop. Find. of Fact and Conc. of Law, at 2-7.) Specifically, plaintiff states defendant's willful conduct is exhibited by the following examples from the record: 1) that defendant made a "deliberate decision" to permit orders of the film received before the date of the Decree that were filled after that date using packaging that did not comply with the dictates of the Decree, (Id. at 2); 2) that the first mailing was not designed to cover the reference to plaintiff on the front of the package, (Id.); 3) that the first mailing was not sent out until after two months after the Decree was entered, (Id.); 4) that the second mailing, which would correct the omission of the first mailing, was sent out a month after defendant learned of the error, (Id. at 3); 5) that defendant "consciously and deliberately" sent the first and second mailings by regular as opposed to certified mail, (Id.); and, 6) that defendant submitted "admittedly misleading affidavits of compliance" in violation of P 6 of the Decree, (Id.).
The court shall consider these each in turn.
1. Defendant's "deliberate decision" to permit orders received for the film before the date of the Decree to be filled with packaging bearing reference to plaintiff even after the date of the Decree.