The opinion of the court was delivered by: Kimba M. Wood, U.S.D.J.
Plaintiff Justin Homkow ("Plaintiff") filed this action against Defendants Musika Records, Inc. ("Musika Records"); Alexander Lim ("Lim"); Rafael Agudelo ("Agudelo"); and John Does Nos. 1-10 (collectively, "Defendants"). Plaintiff moves for sanctions against John H. Harris ("Harris"), Defendants' counsel.
The Court granted Plaintiff a default judgment against Defendants on the following claims: (1) fraud, (2) breach of contract, (3) unjust enrichment, (4) conversion, (5) replevin, (6) accounting, (7) constructive trust, (8) breach of fiduciary duty, (9) misrepresentation, (10) violation of New York General Business Law § 349, and (11) copyright infringement.*fn1 These claims arose after Plaintiff hired Defendants to produce an orchestral recording entitled "The Music of George Washington's Life: A Symphonic Journey" (the "Washington Music Project"). The Court referred the action to Magistrate Judge Katz for an inquest into damages.*fn2
On March 20, 2008, Plaintiff moved for sanctions against Defendants and Harris, alleging that they acted in bad faith in their dealings with the Court and Plaintiff.
On September 10, 2009, Magistrate Judge Katz issued a Report and Recommendation (the "Report"). The thorough and well-reasoned Report recommends that the Court award Plaintiff damages for breach of contract,*fn3 prejudgment interest on the damages award, and injunctive relief. The Report also recommends that:
(1) the Court use its inherent power to impose sanctions on Defendants for making false statements to the Court in bad faith, (2) the Court sanction Defendants in an amount equal to Plaintiff's attorney's fees and costs, (3) this sanction amount be awarded to Plaintiff, and (4) the Court not sanction Harris.
Plaintiff and Defendants both filed timely written objections to the Report's recommendations regarding sanctions. For the following reasons, the Court adopts the Report's recommendations in their entirety.
II. Findings as to Damages and Equitable Relief
Parties do not object to the Report's recommendations as to how the Court should rule on Plaintiff's damages and equitable relief claims. Therefore, the Court reviews these recommendations for clear error. See 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b) advisory committee's note.
The Report recommends that the Court (1) award compensatory and incidental damages for breach of contract and the corresponding prejudgment interest, (2) deny the Plaintiff's request for damages based on lost profits, conversion, and breach of fiduciary duty, (3) deny the equitable relief requested by Plaintiff -- replevin, accounting, and constructive trust, and (4) award sua sponte injunctive relief by requiring Defendants to return to Plaintiff any Washington Music Project materials in their possession, requiring Defendants to provide a sworn affidavit indicating that all Washington Music Project materials have been returned to Plaintiff, and enjoining Defendants from using or exploiting in any manner the Washington Music Project materials.*fn4
The Court finds these portions of the Report to be well-reasoned and free of any "clear error on the face of the record" and therefore adopts the Report's recommendations. Fed. R. Civ. P. 72(b) advisory committee's note; see also Rodriguez v. Morton, 2009 U.S. Dist. LEXIS 12470, *2 (S.D.N.Y. Feb. 13, 2009).
Accordingly, the Court GRANTS Plaintiff compensatory damages in the amount of $25,494.00, incidental damages in the amount of $6,878.63, and prejudgment interest on the total damages ($32,372.63) at a rate of 9%, from the date of breach (May 8, 2003) to the date of judgment (March 17, 2009).
The Court also GRANTS the following injunctive relief: (1) Defendants shall return to Plaintiff any Washington Music Project materials in their possession to Plaintiff, (2) Defendants shall submit a sworn affidavit to the Court stating that they have returned any Washington Music Project materials in their possession to Plaintiff, and (3) Defendants are enjoined from using or exploiting in any fashion any of the Washington Music Project materials.
The Court DENIES Plaintiff's request for damages on the basis of conversion, lost profits, and breach of fiduciary duty. The Court also DENIES Plaintiff's request for equitable relief based ...