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United States District Court, S.D. New York

June 25, 2004.


The opinion of the court was delivered by: BARBARA JONES, District Judge


Plaintiff moves for attorneys fees and costs incurred in conducting a second day of deposition of Defendant company's principal. For the reasons below, Plaintiff's motion is granted in part.


  On March 12, 2004, Plaintiff Cielo Creations, Inc. instituted this trademark infringement action against Gao Da Trading Co., Ltd., and obtained from this Court an order to show cause and a seizure order on the same date. On April 12, this Court entered, on the parties' consent, a preliminary injunction order during the pendency of this proceeding, which included a provision for expedited discovery and an order for recall ("Consent Order").

  Plaintiff wrote a letter to the Court, dated April 27, 2004, detailing Defendant's repeated failures to respond to discovery required by the Consent Order and to discovery requests subsequently propounded by Plaintiff, despite extensions of time and Plaintiff's efforts to obtain the responses. By order dated April 29, the Court directed Defendant to respond to the outstanding discovery requests specified in Plaintiff's April 27 letter and scheduled a conference with the Court for May 5.

  During the May 5 conference, and by order of the same date memorializing the conference, the Court directed Defendant to respond to all outstanding discovery requests in an expedited manner, and to produce its principal, Jian-Feng Dai, for deposition "noticed by counsel." (5/5/04 Order). The Court also stated to Defendant's counsel, Habin Wang,

I can't impress upon you enough that some hard work has to go into this in terms of trying to respond to the Plaintiff's requests. You are going to have to work with your client and try to help him find this information. That's really his duty and your duty as his lawyer in response to the court's order and, I believe it was, a consent judgment in this case. . . .
You [] have a bunch of questions that have been put to you [previously]. You can expect that those are the questions [Plaintiff is] going to want answers to. So I expect you to have your client prepared to respond at the deposition under oath. OK?
Of course, we all know what being under oath means. If you lie under oath there can be problems. So, I'd like him to be as prepared as possible and I need him to be forthcoming because that's his obligation once he's under oath. . . .
(5/5/04 Tr. at 13-14) (emphasis added).

  On May 17, 2004, Plaintiff noticed both a Rule 30(b)(6) deposition and the deposition of Mr. Dai, pursuant to Rule 30(A)(1). The deposition was conducted on May 21.

  Despite the Court's admonitions regarding the need to properly prepare Mr. Dai for his deposition, Mr. Dai admitted that he did not meet with his counsel to prepare for the deposition:*fn1


Q: Mr. Dai, what did you do to prepare for your deposition today?
A: Nothing. I have not prepared anything.
Q: Did you meet with your attorney?
A: No, besides meeting with him this morning downstairs. . . .
Q: So is it your testimony that you did not speak to your attorney at all about this deposition today?
MR. WANG: I object to this line of questioning. . . . Don't answer that.
  A colloquy between the attorneys ensued, resulting in Mr. Wang's objection on the grounds of privilege and his instruction to his client not to answer the question. (Dai Dep. at 14-18). In fact, in the course of five transcript pages, Mr. Wang instructed his client not to answer a pending question on grounds of attorney client privilege seven times, even though not one question requested information concerning the contents of an attorney-client communication. (Id. 14-19).*fn2

  Defendant's attorney was also inappropriately argumentative with the first translator brought in by Plaintiff to translate Mr. Dai's Mandarin Chinese into English. Although the translator was certified to translate Mandarin, Defendant's attorney continually argued with the interpreter and made speaking objections. Plaintiff's counsel requested that Mr. Wang cease making speaking objections and stated that all objections to translation would be preserved. Mr. Wang responded "I can not allow that." Mr. Wang suggested to Plaintiff's counsel that he should have hired someone whose first language was Mandarin, and went so far as make derogatory remarks about Hong Kong after the translator stated that she was raised there. (Dai Dep. at 38-40).


MR. WANG: Hong Kong is a place in the past Century was [sic] ruled by British.
INTERPRETER: So what? I learned Mandarin since I was in 7th Grade.
MR. WANG: [Interpreter], I speak from my experience here, in terms of language skills. People who are educated in Hong Kong, they belittle Mandarin because of the colonial culture.
  Mr. Wang continued on this topic for about a minute longer, and then the deposition went off the record. When it resumed, Plaintiff's counsel stated that the interpreter refused to continue the deposition and left. Plaintiff was able to obtain a second Mandarin translator, but she was only available from 12:30 to 4:00p.m.

  Plaintiff moves for attorneys fees and costs that it will incur in taking a second day of deposition of Mr. Dai on the grounds that this second day was necessitated by Mr. Dai's "lack of preparedness" and "defendant's counsel's aggressive interference in the questioning" during the first day of the deposition. (Pl's 5/26/04 Ltr. at 1).

  After reviewing the videotapes and the transcript of Mr. Dai's deposition, the Court finds Mr. Wang's conduct sanctionable under Federal Rule of Civil Procedure 37, 28 U.S.C. § 1927 and the Court's inherent power. Accordingly, Plaintiff's motion is granted in part.


  1. Federal Rule of Civil Procedure 37

  Federal Rule of Civil Procedure 37 provides for the imposition of sanctions, including attorneys fees and costs, for certain discovery abuses. Fed.R.Civ.P. 37; see also Roadway Exp., Inc. v. Piper, 447 U.S. 752, 763 (1980). Such discovery abuses include failure to comply with a discovery order, see Roadway Exp., 447 U.S. at 763, and failure to make available, after being ordered by a court, "such number of persons as will be able to give complete, knowledgeable and binding answers" on its behalf a corporation noticed under Rule 30(b)(6). See Reilly v. Natwest Markets Group Inc., 181 F.3d 253, 268 (2d Cir. 1999) (citation and quotation marks omitted). "Rule 37 sanctions must be applied diligently both `to penalize those whose conduct may be deemed to warrant such a sanction, [and] to deter those who might be tempted to such conduct in the absence of such a deterrent.'" Roadway Exp., 447 U.S. at 763-764 (quoting National Hockey League v. Metropolitan Hockey Club, 427 U.S. 639, 643 (1976)); see also Daval Steel Prods. v. M/V Fakredine, 951 F.2d 1357, 1364-1365 (2d Cir. 1991) (explaining that Rule 37 "envisions some judicial intervention between a discovery request and the imposition of sanctions . . . [which] serves to alert the offending party to the seriousness of its noncompliance. . . . and specifically informs the recalcitrant party concerning its obligations.").

  In this case, as noted supra, Defendant has a history of noncompliance with discovery requests and with the Consent Order entered by this Court. In addition, the Court specifically ordered Defendant's counsel to produce Mr. Dai pursuant to Plaintiff's notice of deposition, which included a 30(b)(6) notice that specified topics to be addressed during the deposition and a request "to produce at [Mr. Dai's] examination" certain categories of documents, which were described in an attachment to the Notice.

  Despite the Court's efforts to impress upon counsel the importance and necessity of preparing his client for the deposition, counsel did not meet with or prepare Mr. Dai prior to the deposition. Mr. Dai was unable to testify regarding certain topics listed in the 30(b)(6) notice and to produce the documents from some of the categories Plaintiff requested. The Court finds this conduct sanctionable under Rule 37. 2. 28 U.S.C. § 1927

  Pursuant to 28 U.S.C. § 1927, a court may impose sanctions upon:

Any attorney or other person admitted to conduct cases in any court of the United States or any Territory thereof who so multiplies the proceedings in any case unreasonably and vexatiously may be required by the court to satisfy personally the excess costs, expenses, and attorneys' fees reasonably incurred because of such conduct.
28 U.S.C. § 1927. Section 1927 sanctions may be awarded against an attorney for discovery abuses. See Apex Oil Co. v. Belcher Co. of New York, Inc., 855 F.2d 1009, 1019-20 (2d Cir. 1988).

  The Court finds that Mr. Wang's behavior prior to and during the Dai deposition unreasonably multiplied proceedings such that it also warrants sanctions under Section 1927. First, Mr. Wang objected to and instructed his client not to answer several questions without any legal basis. These objections were "so completely without merit as to require the conclusion that they must have been undertaken for some improper purpose such as delay." Salovaara v. Eckert, 222 F.3d 19, 35 (2d Cir. 2000) (citation omitted).

  Second, because Mr. Wang did not prepare Mr. Dai or produce documents Plaintiff requested, Plaintiff did not get the discovery to which it was entitled. Specifically, Mr. Dai was unable to answer certain properly noticed questions and Plaintiff was unable to elicit testimony on documents Defendant did not produce.

  Third, Mr. Wang's hostile and inappropriate remarks towards the interpreter led to her departure and a truncated deposition.

  Mr. Wang's actions have required Plaintiff to take an additional day of deposition in order to get the information it likely would have obtained during the first day if not for his improprieties, making sanctions under Section 1927 appropriate. Accordingly, the Court awards Plaintiff sanctions pursuant Section 1927.

  3. The Court's Inherent Powers

  In addition to statutory authority, courts possess inherent power to impose sanctions. These powers are "governed not by rule or statute but by the control necessarily vested in courts to manage their own affairs so as to achieve the orderly and expeditious disposition of cases." Chambers v. NASCO, Inc., 501 U.S. 32, 44-45 (1991). These powers are discretionary, and provide Court with the ability to fashion an appropriate sanction for conduct that abuses the judicial process. Id.

  In light of the behavior that this Court has found to be improper and to have impeded expeditious resolution of this case, the Court is within its discretion to impose sanctions against Mr. Wang pursuant to its inherent power to manage its affairs.

  4. Defendant's Objections

  Defendant objects to the imposition of sanctions, in part because it goes against the "American Rule that the attorneys' fees . . . may not be awarded to the prevailing party unless authorized by agreement[,] statute or court rule." (Def's 6/8/04 Ltr. at 1).

  The Court does not agree. As is discussed supra, a Court may award attorneys fees and costs under both its statutory authority and its inherent power. In fact, the Supreme Court has repeatedly held that "`[t]here are ample grounds for recognizing . . . that in narrowly defined circumstances federal courts have inherent power to assess attorney's fees against counsel,' even though the so-called "American Rule" prohibits fee shifting in most cases." Chambers, 501 U.S. at 45 (quoting Roadway Express, Inc. v. Piper, 447 U.S. 752 (1980)). These circumstances include "when a party has `acted in bad faith, vexatiously, [and] wantonly.'" Id. at 45-46 (quoting Alyeska Pipeline Serv. Co. v. Wilderness Soc., 421 U.S. 240, 258-259 (1975)); see also 28 U.S.C. § 1927.

  Defendant also opposes Plaintiff's motion on the grounds that the translator was not qualified to translate Mandarin. Specifically, Defendant repeats his objection the translator's "competency" because her "first language is Cantonese." (Def's 6/8/04 Ltr. at 2). Defendant alleges that "[d]uring the first hour of the deposition, on at least two occasions, [the translator] left out part of Mr. Dai's answer because she did not understand what Mr. Dai was saying for the left out part." (Id.) In response, Plaintiff argues that the translator was competent and not able to translate only because Mr. Wang repeatedly interrupted and argued with her.

  Regardless of whether the translations were completely accurate, Defendant's behavior was nonetheless improper. Mr. Wang repeatedly made speaking objections regarding the translations, even after Plaintiff's offer to preserve all objections to translation. Mr. Wang was also hostile towards the translator and made inappropriate remarks. This conduct led to a delay in the deposition of several hours.


  The Court grants Plaintiff's motion for sanctions, and awards it attorneys fees and costs incurred for 3 hours of Mr. Dai's May 21 deposition, as well as the costs to be incurred in taking a second day of deposition of Mr. Dai.


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