Seven Arts Pictures, Inc. v. Jonesfilm
| Decision Date | 01 November 2012 |
| Docket Number | CIVIL ACTION NO. c/w 09-4815,CIVIL ACTION NO. 09-4814 |
| Parties | SEVEN ARTS PICTURES, INC., ET AL Plaintiffs v. JONESFILM Defendant |
| Court | U.S. District Court — Eastern District of Louisiana |
The matters before the Court are a Motion for Judgment Against Judgment Debtors and Garnishees for Their Disobedience of this Court's November 15, 2011 Order (Doc. 121) ("Motion for Contempt") filed by Jonesfilm and a Motion to Dismiss for Lack of Jurisdiction and/or Alternatively Motion to Transfer Venue (Doc. 126) filed by Cinevisions, Peter Hoffman, Seven Arts Filmed Entertainment Limited and Seven Arts Entertainment Inc. For the following reasons, Defendant's Motion for Disobedience of this Court's November 15, 2011 Order is GRANTED andPlaintiffs' Motion to Dismiss for Lack of Jurisdiction and/or Alternative Motion to Transfer is DENIED.
In 2002 a dispute arose out of the alleged misconduct of Defendant Peter Hoffman's Company, NTTS Productions, Ltd., with respect to certain Jonesfilm motion picture rights. Jonesfilm instituted an arbitration proceeding against Defendant Peter Hoffman ("Hoffman") and his affiliate company, NTTS Productions, Ltd. ("NTTS"), before the American Film Marketing Assocation ("AFMA"). On July 20, 2004, the AFMA arbitration tribunal issued a declaration of rights in favor of Jonesfilm and a monetary award to Jonesfilm against NTTS. The order was confirmed by the Superior Court for Los Angeles County, California in December 2004. On March 18, 2005, the Los Angeles Superior Court amended its judgment to include Hoffman as a Judgment Debtor in the action as the alter ego of NTTS, finding him jointly and severally liable for its obligation under the judgment.
In August 2005, Jonesfilm instituted an arbitration proceeding against Peter Hoffman affiliates Cinevisions ("CV"), Seven Arts Pictures, Inc. ("SAP"), Seven Arts Filmed Entertainment Limited ("SAFE"), and Seven Arts Pictures, PLC ("PLC") before the Independent Film & Television Alliance ("IFTA"). On June 22, 2006, the IFTA arbitrator issued a monetary award and other relief in favor of Jonesfilm and against the Peter Hoffman affiliates, CV, SAP, SAFE and PLC, jointly andseverally. The arbitrator awarded Jonesfilm $291,911.00 plus interest at the rate of ten percent per annum and $131,752.56 for attorneys' fees and other arbitration costs. The United States District Court for the Central District of California confirmed the arbitration award on June 19, 2007. The Court further awarded $246,186.53 representing the combined attorneys' fees and other arbitration costs plus interest at ten percent per annum starting from January 16, 2007.
On July 25, 2007 Jonesfilm filed a motion for contempt against the judgment debtors and Hoffman alleging that they failed to comply with the June 19, 2007 Judgment. The United States District Court for the Central District of California issued an order on February 26, 2008 holding the judgment debtors and Hoffman in contempt, and awarded Jonesfilm $14,300.00 in attorneys' fees.
Judgment debtors subsequently appealed both the June 19, 2007 Judgment and the February 26, 2008 Order to the United States Court of Appeals for the Ninth Circuit. The Ninth Circuit affirmed both the Judgment and Order on February 12, 2009.
Jonesfilm alleges that the judgment debtors have failed to make any payments to Jonesfilm and have further failed to satisfy any other obligations imposed by these previous judgments. Jonesfilm conducted discovery which confirmed that Hoffman and other Judgment Debtors have interests in Louisiana properties and, in light of their failure to pay Jonesfilm on the previous judgments, began actions in this Court to collect on and enforce its judgments. Thus, on July 31, 2009 Jonesfilm registered the June 19, 2007 Judgment in this Court.
On October 6, 2010 Jonesfilm sought, and this Court issued, charging orders against thejudgment debtors' membership interests in five Louisiana limited liability companies. The Court's order also required the judgment debtors to deliver financial statements, tax returns, and K-1 documentation of the judgment debtors and the Louisiana limited liability companies.
On March 25, 2011 Jonesfilm filed a Motion for Contempt with respect to the judgment debtors' alleged failure to comply with such charging orders and to compel answers to certain garnishment interrogatories. On August 15, 2011 Jonesfilm filed a Motion for Order Requiring Immediate Delivery by Garnishee Leeway Properties, Inc. and Judgment Debtor Peter Hoffman of Funds and Other Relief. On October 26, 2011 Magistrate Judge Knowles issued a Report and Recommendation on these two Motions. On November 15, 2011 this Court approved the Magistrate Judge's Findings and Recommendation and adopted it as its own. Accordingly, this Court granted Jonesfilm's Motion for Contempt and Motion Requiring Immediate Delivery of funds. Additionally, the Court awarded Jonesfilm $21,357.50 in attorneys' fees.
On December 16, 2011 Jonesfilm filed a Motion for Contempt in relation to this Court's November 15, 2011 Order. (Doc. 121.) Esplanade Pictures LLC ("Esplanade"), SAP, Seven Arts Filmed Entertainment Louisiana, LLC ("SAFE LA"), Seven Arts Pictures Louisiana (Equicap), LLC ("Equicap"), Seven Arts Post LLC ("Post"), 807 Esplanade Avenue MT LLC ("807"), collectively "Garnishees," filed their Memorandum in Opposition on January 24, 2012. (Doc. 128.) Leeway Properties, Inc. ("Leeway") filed its memorandum in opposition on January 24, 2012. (Doc. 129.) Jonesfilm filed a supplemental memorandum on February 1, 2012. (Doc. 138.) Jonesfilm repliedto the Garnishees opposition and Leeway's opposition on February 1, 2012. (Docs. 140, 142.) Peter Hoffman and SAP filed a memorandum in opposition on February 13, 2012. (Doc. 149.) Jonesfilm's Motion for Contempt was taken under submission on February 15, 2012.
On January 17, 2012 CV, Hoffman, SAFE, and Seven Arts Entertainment Inc. ("SAE") filed a Motion to Dismiss for Lack of Jurisdiction and/or Motion to Transfer to the Central District of California. (Doc. 126.) Jonesfilm opposed the Motion on January 27, 2012. (Doc. 133.) The Plaintiffs filed their reply memorandum on February 13, 2012. (Doc. 150.) Plaintiffs' Motion was taken under submission on February 15, 2012.
Jonesfilm requests the Court (1) to enter judgment against Leeway and Hoffman in the amount of $174,769.56 which this Court had previously order they immediately deliver, but which they have not, plus interest from January 28, 2011; (2) to compel each judgment debtor to deliver its financial statements and tax returns to Jonesfilm for 2007 through 2011 in accordance with this Court's November 15, 2011 Order; (3) to compel each garnishee to fully answer the Garnishment Interrogatories with complete and responsive answers in accordance with Magistrate Judge Knowles' Report and Recommendation and this Court's November 15, 2011 Order; (4) to award Jonesfilm reasonable attorneys' fees and costs not less than $7,977.00 against the judgmentdebtors and garnishees jointly and severally as a result of obtaining compliance with this Court's November 15, 2011 Order; and (5) to correct a typographical error in the third decretal paragraph which conjoins Seven Arts Entertainment Inc. and Seven Arts Filmed Entertainment Limited. For the following reasons the Court grants all requested relief in Jonesfilm's Motion for Contempt.
"A movant in a civil contempt proceeding bears the burden of establishing by clear and convincing evidence (1) that a court order was in effect; (2) that the order required certain conduct by the respondent; and (3) that the respondent failed to comply with the court's order." Test Masters Educ. Services, Inc. v. Singh, 428 F.3d 559, 581-582 (5th Cir. 2005) (internal citations and quotations omitted). "The contemptuous actions need not be willful so long as the contemnor actually failed to comply with the court's order." American Airlines Inc. v. Allied Pilots Ass'n, 228 F.3d 574, 581 (5th Cir. 2000); see also McComb v. Jacksonville Paper Co., 336 U.S. 187, 191 (1949) ().
Jonesfilm asserts that Leeway and Hoffman continue to disobey the Court's November 15, 2011 Order requiring "immediate delivery" of $174,769.56 disbursed by Leeway in violation of the Court's January 26, 2011 Garnishment Order. (Doc. 121-1 at 2.) Additionally, neither Leeway norHoffman have provided any accounting or tracing of the wrongfully transferred funds. (Id.) Jonesfilm contends that, due to these failures, it is entitled to damages pursuant to Louisiana Civil Code Article 2502. (Id. at 10-11.) Jonesfilm further argues that interest should accrue at the California statutory rate of ten percent per annum on the $174,769.56 beginning on January 28, 2011 for the same reasons that Judge Knowles found that California's remedies of a constructive trust and a constructive or equitable lien should apply to the $174,769.56. (Id. at 12.) Leeway opposes these arguments and asserts that because $0.00 is in its bank account and that it cannot rescind the unauthorized account transfers then it cannot immediately transfer what it does not have. (Doc. 129 at 2-3.) Leeway also notes that it is still awaiting the outcome of the investigation into the wrongful transfers. (Id.)
This Court finds that a court order was in effect. (See Doc. 114.) Moreover, the Order required Leeway and Hoffman to immediately deliver to the U.S. Marshal the sum of $174,769.56 and to deliver a full and complete accounting and tracing of any and all disbursements and proceeds to the extent that Leeway and Hoffman had disbursed any of these...
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