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FOX INDUSTRIES, INCORPORATED v. GUROVICH

United States District Court, E.D. New York


August 25, 2004.

FOX INDUSTRIES, INCORPORATED, Plaintiff,
v.
LEONID GUROVICH, a/k/a LEO GORE, Defendant.

The opinion of the court was delivered by: THOMAS PLATT, JR., Senior District Judge

MEMORANDUM AND ORDER

In Orders of April 28 and May 26, 2004, Defendant Leo Gore was found in contempt of October 15 and 23 and November 20, 2003 Orders of the Court. Now before the Court is a Report and Recommendation of Magistrate Judge William D. Wall dated July 15, 2004. The Report grants Plaintiff Fox Industries, Incorporated a yet-to-be determined sum in lost profits, and at least $37,691.73 in attorney's fees and costs, relating to the contemptuous conduct of Gore. On July 26, 2004 Gore offered his objections to the Report. He objects to (i) the award of lost profits on three specified transactions; (ii) the award of attorneys fees and costs, on the grounds that his conduct was not "willful"; and (iii) the court appointment of a forensic computer expert in this case.

For the following reasons, the Report is AFFIRMED and ADOPTED as an Order of this Court. The short answer to Gore's persistent argument that he has done nothing wrong is that he has yet to testify to anything in answer or rebuttal to all the charges against him.

  Discussion

  (i) Lost profits

  Gore argues that Fox did not sustain any lost profits from his conduct in the three specific instances of contempt: his unsuccessful solicitation of the sale of grinding media to Tape Systems, Incorporated and Bayer CropSciences, and his unsuccessful solicitation of the purchase of grinding media from Nissuma International, Limited. Fox lost no profits, Gore reasons, because his solicitations were rebuffed, and because his solicitation of Nissuma was for a sale, and not a purchase, of grinding media. Gore's Objections at 2-3. Gore's objection is well-taken, but it was specifically addressed in the Report itself, which found that while "Fox is unequivocally entitled to those lost profits," "the Court accepts Fox's claim that it cannot now calculate those profits," but that "[i]f and when the Plaintiff is able to calculate those damages, it should submit its calculation to the Court." The Report at 13-14. As the Report is accepted by this Court, Fox may proceed to offer its proofs of lost profits.*fn1 (ii) Fees and costs

  Gore objects (at length, see his Objections at 3-14) to the award of at least $37,691.73 in attorney's fees and costs to Fox. Gore argues that the undersigned "failed to make an explicit or implicit finding of willfulness with respect to the three solicitations. Gore's Objections at 4.

  The Court's April 28, 2004 Order found that

Fox has shown, by overwhelming and unrebutted evidence, that Gore violated the Orders through three of the four alleged solicitations . . . The Court also finds that its Orders, which were personally served upon Gore after their entry, are clear and unambiguous in their restraining and enjoining Gore from disclosing or utilizing any of Fox's confidential and proprietary information, including customer lists and pricing information, and from engaging in any aspect of the grinding media business, including soliciting.
Id. at 9.

  Evidence not having been presented at the April 16-21, 2004 hearing that Gore placed the phone calls in question with a gun placed to his head, or while having an out-of-body experience, the Court assumed that any reader would infer that the undersigned had indeed found Gore's conduct to be willful. If further clarification is needed, the Court states that it finds Gore's volitional conduct, in placing sales calls to Fox's customers from Fox's customer lists using Fox's pricing information, after having been enjoined from doing so, to be willful. The suggestion that willfulness could not be implied by Judge Wall from the undersigned's Oers, and from the record presented, is sophistry.

  Gore's real objection to a finding of willfulness is his repeated argument that the incriminating November 12, 2003 tape of his conversation with Mr. Robert Mann is nothing but a fake (see the April 28, 2004 Order at 8, 14-15, in which the relevant Orders are described as merdique, yet humorous). At the risk of repeating itself (see the Court's July 1, 2004 Order, in which the undersigned declined to disqualify himself from this case pursuant to 28 U.S.C. § 455, at 6-7), the Court again emphasizes that the necessary basis for any argument that the tape is a forgery is the sworn testimony of Gore that he did not make the statements contained therein. Unless and until Gore, an available witness, takes the stand and denies — under oath and subject to cross-examination — the accuracy of the contents of the tape, neither his lawyer's increasingly perfervid arguments, nor the testimony of every expert in the world, will suffice as the foundation for a finding that the tape is an elaborate counterfeit.

  Gore's counsel, Simon Schwarz, Esq., continues in this vein to accuse opposing counsel, Michael A. Saffer, Esq., Mr. Mann, and Fox Industries' President Charles E. Richardson of fraud, perjury and the subornation of perjury in connection with the entry of the tape into evidence. Gore's Objections at 6-7, 13-15. (Mr. Schwarz, at the April 16-21, 2004 hearings, also accused Mr. Richardson of tax evasion, see the April 28, 2004 Order at 16.) The Court repeats its warnings, issued at both the hearings and in its Order (see id. at 16, n. 12), that Mr. Schwarz treads on dangerous ground.

  The issue before the Court is the contempt and misconduct of Gore, and not Gore's attorney's allegations of misbehavior on the part of Messrs. Mann, Saffer and Richardson. If Mr. Schwarz's allegations are proven true, so be it. But if Mr. Schwarz continues to make defamatory allegations of criminal behavior on the part of the opposing parties and opposing counsel, and these felonious charges are shown to be unfounded, his tactics will not redound to his professional credit.

  (iii) Forensic computer expert

  Finally, Gore objects to the Court's appointment of a forensic computer expert to examine his computer, unless, inter alia, Mr. Schwarz is "present throughout his examination and do[es] not let him look at privileged or personal documents or emails." Gore's Objections at 15-16.

  Gore may certainly propose a protective discovery order to Judge Wall concerning the modus operandi of the search of his computer. Mr. Schwarz may be present, if he wishes, at any forensic examination of Gore's computer (as may Mr. Saffer) while a tamper-proof mirror image of that computer's files is made. And Mr. Schwarz may also subsequently identify any documents or emails as being, in his view, personal or privileged. But Gore's and Mr. Schwarz's mere assertions that a document or email is personal or privileged will not suffice to prevent its discovery. Such matters may be decided by Judge Wall, in accordance with his procedures. Conclusion

  For the foregoing reasons, the July 15, 2004 Report and Recommendation of Magistrate Judge William D. Wall is AFFIRMED and ADOPTED as an Order of this Court.

  Finally, the Court notes in passing Gore's August 16, 2004 petition to the United States Court of Appeals for the Second Circuit for a writ of mandamus, seeking to disqualify the undersigned from this case. The Court's views on the issue of disqualification were set forth in full it its July 1, 2004 Order rejecting Gore's motion for disqualification under 28 U.S.C. § 455(a). The undersigned awaits, with respect, the Court of Appeals' decision on the matter.

  One item from Gore's petition does bear further mention, however. Gore's attorney, Mr. Schwarz, continues his increasingly strange jeremiad regarding his (dubious) assertion that despite the best efforts of himself and a taxicab driver, he could not find the United States Courthouse in Central Islip on November 14, 2003. See Gore's Petition at 5-12. In his petition, Gore again cites the argument on this subject of Mr. Schwarz at the April 19, 2004 contempt hearing that "I came from New York City. My partner was there and I was there, and we couldn't see anything." Id. at 8 (emphasis supplied).*fn2 As the Court set forth in its April 28, 2004 Order adjudging Gore in contempt, on the afternoon of November 14th, the undersigned's chambers attempted to reach Mr. Schwarz at the offices of Schwarz & Black, LLP to ascertain his estimated time of arrival. A law clerk spoke to an individual who claimed to be Mr. Schwarz's "law partner" — presumably Mr. Barry Black, Esq. — who said that Mr. Schwarz was simply "unavailable." Id. at 3, n. 2.

  Along with the resolution of the mystery of the evanescent courthouse, the Court also awaits an explanation for the remarkable bi-location of Mr. Black. Alternatively, Messrs. Schwarz and Black might follow the advice often given to men who find themselves in a ditch with shovels — stop digging.

  SO ORDERED.


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