QATAR NATIONAL BANK v. WINMAR, INC.

Filing 130

MEMORANDUM OPINION to the Order granting in part and denying in part Al Jazeera's Objections to Magistrate Judge Facciola's Report & Recommendation. Signed by Judge Gladys Kessler on 9/28/11. (CL, )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
______________________________
QATAR NATIONAL BANK,
)
)
Plaintiff,
)
)
v.
)
)
WINMAR, INC.,
)
)
Defendant,
)
)
v.
)
Civil Action No. 06-1307 (GK)
)
AL JAZEERA INTERNATIONAL,
)
)
Third Party
)
Defendant.
)
______________________________)

MEMORANDUM OPINION
Third-party Defendant Al Jazeera International (“Al Jazeera”),
a division of Al Jazeera Satellite Network, an international news
network headquartered in Doha, Qatar, and Plaintiff, Qatar National
Bank (“QNB”), have filed Objections to the Report & Recommendation
(“R&R”_ issued by Magistrate Judge John M. Facciola on July 15,
2011 (“July 15, 2011 Report”) [Dkt. No. 119]. Upon consideration of
the Objections, Oppositions, Replies, the Report & Recommendation,
and

the

entire

record

herein,

the

Court

concludes

Objections will be granted in part and denied in part.

that

the

I. Background
This dispute involves two separate but related actions arising
out of a 2005 agreement between Al Jazeera and Winmar, Inc.,
(“Winmar”),

a

Washington,

D.C.-based

construction

firm,

to

construct a state-of-the-art television studio and office space for
Al Jazeera at 1627 K Street, N.W., Washington, D.C.
The first action involves a dispute between QNB and Winmar,
and relates to a wire transfer system Al Jazeera established at QNB
to pay Winmar for its work. QNB alleged that in January 2006 it
mistakenly sent a $474,677 payment to Winmar, on Al Jazeera’s
behalf, which Winmar refused to refund. On September 3, 2009, this
Court

granted

judgment

QNB’s

against

Motion

Winmar

for

for

Summary

the

full

Judgment
refund

and

entered

amount,

plus

prejudgment and post-judgment interest. See Qatar Nat’l Bank v.
Winmar, Inc., 650 F. Supp. 2d 1 (D.D.C. 2009).
The second action involves a dispute between Winmar and Al
Jazeera, involving various claims and cross claims between the
parties for breach of the parties’ 2005 construction agreement
(“2005 Agreement”), unjust enrichment, and mistake. From June 30,
2010 through July 2, 2010, a bench trial was held in this matter.1
On September 29, 2010, this Court entered judgment against Al

1

Further details about the factual and procedural history of this
case can be found in this Court’s September 29, 2010 and September
3, 2009 opinions. See Winmar, Inc., v. Al Jazeera Int’l, 741 F.
Supp. 2d 165 (D.D.C. 2010); Qatar Nat’l Bank v. Winmar, Inc., 650
F. Supp. 2d 1 (D.D.C. 2009).
2

Jazeera in the amount of $1,472,625.50 plus prejudgment and postjudgment interest (“September 29, 2010 judgment”). See Winmar,
Inc., v. Al Jazeera Int’l, 741 F. Supp. 2d 165.

On October 28,

2010, Al Jazeera appealed this decision [Dkt. No. 74].2
Shortly after the entry of judgment against Al Jazeera, the
parties filed a series of post-judgment motions, including Winmar’s
Motion to Alter or Amend the Judgment to Include Attorneys’ Fees
and Costs Plus Pre and Post Judgment Interest (“Winmar’s Motion to
Alter or Amend”)(Oct. 13, 2010) [Dkt. No. 69], QNB’s Motion for
Entry of a Charging Order (“QNB’s Motion for Charging Order”) (Jan.
7, 2011)[Dkt. No. 88], and Winmar’s Motion to Quash Notice of
Seizure or in the Alternative to Permit Winmar to Execute upon Its
Judgment Against Al Jazeera International (“Winmar’s Motion to
Quash”)(Jan. 7, 2011) [Dkt. No. 90].
The Court subsequently referred these Motions to Magistrate
Judge Facciola for a Report & Recommendation. See Notice to Counsel
(Apr. 13, 2011) [Dkt. No. 109]; Order (June 10, 2011) [Dkt. No.
117]. On July 15, 2011, Magistrate Judge Facciola issued his Report
& Recommendation for all three Motions.

2

On April 13, 2011, the Court of Appeals for this Circuit issued
an Order holding Al Jazeera’s appeal in abeyance pending the
resolution of Winmar’s Motion to Alter or Amend, then pending
before this Court. See Order [Dkt. No. 1303042], Qatar Nat’l Bank
v. Winmar, Inc. v. Al Jazeera Int’l, No. 10-7137 (D.C. Cir. filed
Oct. 29, 2010).
3

On July 29, 2011, Al Jazeera and QNB each filed Objections to
the

Magistrate

International’s

Judge’s

July

Objections

to

15,

2011

R&R.

the

Magistrate

See

Al

Judge’s

Jazeera
Proposed

Findings and Recommendations (“Al Jazeera Objections”) [Dkt. No.
121]; Objection to the Findings and Recommendations of Magistrate
(“QNB Objections”)[Dkt. No. 122]. On August 12, 2011, Winmar filed
an Opposition to Al Jazeera and QNB’s Objections. See Winmar Inc.’s
Response to Objections to the Report and Recommendation of the
Magistrate Judge (“Winmar Opp’n”) [Dkt. No. 125]. On August 19,
2011, Al Jazeera and QNB filed replies to Winmar’s opposition. See
Al Jazeera International’s Reply to Winmar Inc.’s Response to Al
Jazeera

International’s

Objections

to

the

Magistrate

Judge’s

Proposed Findings and Recommendations (“Al Jazeera Reply”) [Dkt.
No.

126];

Memorandum

in

Reply

to

Winmar

Inc.’s

Response

to

Objections to the Report and Recommendations of the Magistrate
Judge (“QNB Reply”) [Dkt. No. 127].
II. Anlaysis
Pursuant to Federal Rule of Civil Procedure 53 and LCvR
72.3(c), the court reviews objections to the factual findings and
legal conclusions of a report & recommendation de novo. As no
objections have been filed to the Magistrate Judge’s R&R for QNB’s
Motion

for

a

Charging

Order,

the

Court

will

adopt

his

Recommendation and deny the Motion. Al Jazeera and QNB have,
however,

raised

Objections

to

4

the

Magistrate

Judge’s

Recommendations for Winmar’s Motion to Alter or Amend and Winmar’s
Motion to Quash.
A.

Winmar’s Motion to Alter or Amend

Al Jazeera raises Objections to the following portions of the
July 15, 2011 R&R for Winmar’s Motion to Alter and Amend: (1) the
Recommendation that Winmar be permitted to file a new motion for
attorneys’ fees; (2) the Recommendation that prejudgment interest
on the September 29, 2010 judgment be calculated as of March 9,
2006; (3) the Recommendation that Winmar’s claim for post-judgment
interest be governed by the construction contract rather than 28
U.S.C.

§

1961;

and

(4)

the

Recommendation

that

the

Court’s

September 29, 2010 judgment be vacated, instead of amended, and
that Al Jazeera post a supersedeas bond. Al Jazeera Objections 217. QNB also joins in this last objection. QNB Objections 1-3.
1.

Attorneys’ Fees

In his July 15, 2011 R&R, the Magistrate Judge denied
Winmar’s request that Al Jazeera pay all the attorneys’ fees
incurred by Winmar in its disputes with both Al Jazeera and QNB.
The

Magistrate

Judge

concluded

that,

pursuant

to

the

2005

Agreement, Al Jazeera was not responsible for the attorneys’ fees
relating to Winmar’s dispute with QNB.3 July 15, 2011 R&R 6. The
3

Section 4.6.3. of the parties’ 2005 Agreement states that: “In
any action or proceeding brought by the Contractor [Winmar] to
enforce any provision of this Agreement, or where any provision is
validly asserted as a defense, the Contractor shall be entitled to
(continued...)
5

Magistrate Judge also concluded that under the 2005 Agreement Al
Jazeera remained liable for attorneys’ fees Winmar incurred in
their dispute. Id. at 6-7. The Magistrate Judge recommended,
therefore, that Winmar’s Motion to Alter or Amend be denied without
prejudice and that Winmar be permitted to submit a revised motion
seeking only those attorneys’ fees incurred in its dispute with Al
Jazeera. Id. at 7.
Although Al Jazeera does not dispute Winmar’s contractual
right to attorneys’ fees, it argues that Winmar should not be
allowed a “second bite at the apple” as Winmar had no grounds for
seeking attorneys’ fees relating to its dispute with QNB. Al
Jazeera

Objections

3.

Al

Jazeera

has,

however,

presented

no

authority supporting this position, which effectively deprives
Winmar of its contractual right to attorneys’ fees, nor is such a
harsh outcome either appropriate or fair. The Court, therefore,
adopts the Magistrate Judge’s Recommendation to grant in part and
deny in part Winmar’s Motion to Alter or Amend and to require
Winmar to resubmit a request for attorneys’ fees which relate only
to its dispute with Al Jazeera.

3

(...continued)
recover reasonable attorneys’ fees in addition to its costs and
expenses and any other available remedy.” The Magistrate Judge
concluded that, because Winmar did not prevail in its dispute with
QNB, there was no “validly asserted” defense as required by this
provision. July 15, 2011 R&R 6.
6

2.

Prejudgement Interest

In the July 15, 2011 R&R, the Magistrate Judge recommended
that, pursuant to the 2005 Agreement, prejudgment interest on the
September 29, 2010 judgment be calculated from March 9, 2006. July
15, 2011 R&R 8.
Al Jazeera does not suggest that a March 9, 2006 start-date is
inconsistent with the language of the 2005 Agreement. Rather,
citing to D.C. Code § 15-109,4 Al Jazeera claims that the Court “is
free within the exercise of its sound discretion to adopt a
different date from which prejudgment interest at the contract rate
will apply.” Al Jazeera Objections 5. Al Jazeera argues that the
Court

should

exercise

this

discretion

and

allow

prejudgment

interest to run from January 12, 2007, the date on which Al Jazeera
was served with Winmar’s Third Party Complaint and first “had any
reason to believe that Winmar had a claim against it, much less
that any money was due and owing to Winmar.” Id. at 9.
Al

Jazeera

discretion
Columbia

in

v.

is

correct

awarding
Pierce

that

the

prejudgment

Assocs.,

Inc.,

Court

interest.
527

A.2d

has

considerable

See

District

306,

310

of

(D.C.

1987)(under Section 15-109, the factfinder “in the exercise of its

4

D.C. Code § 15-109 relates to the interest on judgments in
contract and tort cases. It provides, in relevant part, that: “In
an action to recover damages for breach of contract the judgment
shall allow interest on the amount for which it is rendered from
the date of the judgment only. This section does not preclude the
jury, or the court . . . from including interest as an element in
the damages awarded . . . .”
7

discretion, [has] authority to award prejudgment interest in cases
involving unliquidated claims if necessary to fully compensate the
plaintiff”). The Court concludes, however, that the Magistrate
Judge appropriately recommended a March 9, 2006 start-date for
prejudgment interest. This start-date comports with the parties’
2005 Agreement, and Al Jazeera has provided no compelling reason
for the Court to depart from the contract language and assign a
different start-date. For these reasons, the Court denies Al
Jazeera’s

objection,

and

affirms

the

Magistrate

Judge’s

Recommendation on this issue.
3.

Post-judgment Interest

In his July 15, 2011 R&R, the Magistrate Judge recommended
that post-judgment interest on the September 29, 2010 judgment be
set at a rate of 12%, in accordance with the 2005 Agreement. July
15, 2011 R&R 10. Al Jazeera objects to the Magistrate Judge’s
Recommendation and argues that 28 U.S.C. § 1961 should govern postjudgment interest on the September 29, 2010 judgment. Al Jazeera
Objections 10.
28 U.S.C. § 1961 provides in relevant part that:
Interest shall be allowed on any money judgment in
a civil case recovered in a district court. . . .
Such interest shall be calculated from the date of
the entry of the judgment, at a rate equal to the
weekly average 1-year constant maturity Treasury
yield, as published by the Board of Governors of
the Federal Reserve System, for the calendar week
preceding the date of the judgment.

8

In Section 1961, “Congress expressed its desire to establish
a realistic and nationally uniform rate of interest on judgments in
Federal courts to eliminate the incentive for delaying payment of
judgments and for filing frivolous appeals . . . .” Nissho-Iwai Co.
v. Occidental Crude Sales, Inc., 848 F.2d 613, 623 (5th Cir.
1988)(citation and internal quotations omitted). Although parties
may contract around 28 U.S.C. § 1961, “to do so, they must
specifically contract around the general rule that a cause of
action reduced

to

judgment

merges

into

the judgment

and

the

contractual interest rate therefore disappears for post-judgment
purposes.” In re Riebesell, 586 F.3d 782, 794 (10th Cir. 2009)
(citation

and

internal

quotations

omitted).

To

satisfy

this

standard, the parties’ contract must expressly state that the
chosen interest rate specifically applies to judgments or judgment
debts. See FCS Advisors, Inc. v. Fair

Fin. Co., 605 F.3d 144, 148

(2d Cir. 2010)(holding that Section 1961 applied where the parties’
agreement failed to specify that the selected interest rate applied
to either judgements or judgment debts).
The parties 2005 Agreement does not meet this standard. Under
Section 7.2 of the 2005 Agreement, “[p]ayments due and unpaid under
the Contract shall bear interest from the date payment is due at
the rate [of 12%], or in the absence thereof, at the legal rate
prevailing from time to time at the place where the Project is
located.” Joint Ex. 1-5. This provision clearly fails to expressly

9

state that the 12% interest rate applies to judgments or judgment
debts. Consequently, the Court shall grant Al Jazeera’s objection
and set the post-judgment interest rate in accordance with 28 U.S.
§

1961.

Based

on

this

statute,

the

applicable

post-judgment

interest rate for the September 29, 2010 judgment is .25%. PostJudgment

Interest

Rate

2010,

available

http://www.utd.uscourts.gov/documents/int2010.html.

For

at
this

reason, the Court rejects the Magistrate Judge’s Recommendation on
this issue and grants Al Jazeera’s objection.
4.

Vacating the Judgment and Posting a Supersedeas
Bond

In the July 15, 2011 R&R, the Magistrate Judge recommended
that the September 29, 2010 judgment be vacated and that a new
judgment be entered that “reflects the award of [] a specific
amount of pre-judgment interest and [] attorneys’ fees.” July 15,
2011 Report 12. The Magistrate Judge also recommended that, once a
new

judgment

is

entered,

Al

Jazeera

be

required

to

post

a

supersedeas bond as this “would protect the interests of both
Winmar and QNB as judgment creditors.” Id.
Al Jazeera and QNB object to vacature of the September 29,
2010 judgment on the grounds that the Magistrate Judge made this
recommendation
Objection 2.

sua

sponte.

Al

Jazeera

Objections

14-15;

QNB

Nor did Winmar request such relief. As the Court has

no authority to order such relief sua sponte, and the parties had
no

opportunity

to

address

the
10

issue

in

advance

of

the

Recommendation, the Court grants Al Jazeera and QNB’s objections on
this point and shall amend, rather than vacate, the September 29,
2010 judgment.
Al Jazeera and QNB object to the Recommendation for posting of
a supersedeas bond on the ground that the Court lacks authority
under Federal Rule of Civil Procedure 62. Pursuant to that Rule,
“[i]f an appeal is taken, the appellant may obtain a stay by
supersedeas bond . . . . The bond may be given upon or after filing
the notice of appeal or after obtaining the order allowing the
appeal.” Al Jazeera and QNB are correct that, barring a request
from Al Jazeera to stay execution of the September 29, 2010
judgment, which it did not make, the Court cannot require Al
Jazeera to post a supersedeas bond. See Strong v. Laubach, 443 F.3d
1297, 1299 (10th Cir. 2006) (“A judgment debtor who is unable or is
unwilling

to

post

a

supersedeas

bond

retains

the

right

to

appeal . . . .”) (citing to Koster & Wythe v. Massey, 262 F.2d 60,
62 (9th Cir. 1958)). As Al Jazeera has not requested a stay of
execution, this Court shall grant Al Jazeera and QNB’s Objections
to the Recommendation.
B. Winmar’s Motion to Quash
In

the

July

15, 2011

R&R,

the

Magistrate

Judge granted

Winmar’s Motion to Quash QNB’s Notice of Seizure and denied as
premature Winmar’s alternative request to execute on the September
29, 2010 judgment. July 15, 2011 Report 12. The Magistrate Judge
11

based this Recommendation on his assumption that the September 29,
2010 judgment would be vacated and that there was, therefore, no
judgment upon which either QNB or Winmar could execute. July 15,
2011

Report

12.

QNB

objects

to

the

Magistrate

Judge’s

recommendation and argues that Winmar’s Motion to Quash should be
denied on the merits. QNB Objections 3-4.
The Court agrees that it is appropriate at this time to decide
Winmar’s Motion to Quash on the merits. In that Motion, Winmar
seeks to prevent QNB from seizing the September 29, 2010 judgment
for $1,472,625.50 and selling it at public auction to satisfy the
debt Winmar

owes

QNB over

the

mistaken

payment

of

$474,677.

Memorandum in Support of Winmar Inc.’s Motion to Quash Notice of
Seizure or in the Alternative to Permit Winmar to Execute upon Its
Judgment Against Al Jazeera International, 3 (“Mem. in Support of
Winmar Mot. to Quash”) (Jan. 1, 2011) [Dkt. No. 90-1]. Winmar
argues that QNB should not be permitted to seize the September 29,
2010 judgment because Al Jazeera’s pending appeal has prevented
Winmar from executing upon the judgment. Id. In support of its
argument, Winmar points to a letter from the Clerk of this Court,
denying Winmar’s request for a Writ of Execution against the
September 29, 2010 judgment because of Al Jazeera’s pending appeal.
Ex. B to Winmar’s Mot. to Quash (Jan. 7, 2011)[Dkt. No. 90-3].
Should the Court deny its Motion to Quash, Winmar seeks an Order

12

permitting it to execute on the September 29, 2010 judgment.5 Mem.
in Support of Winmar Mot. to Quash, 3.
In response to Winmar’s Motion, QNB argues that, even if
Winmar cannot execute on the September 29, 2010 judgment, QNB is
empowered, pursuant to D.C. Code §§ 15-307 and 15-312, to effect a
public sale of the September 29, 2010 judgment. Memorandum in
Opposition to Winmar Inc.’s Motion to Quash Notice of Seizure or in
the Alternative to Permit Winmar to Execute upon Its Judgment
Against Al Jazeera International, 4 (“QNB Opp’n to Winmar Mot. to
Quash”)(Jan. 12, 2011) [Dkt. No. 92].6

5

In its opposition to Al Jazeera and QNB’s Objections, Winmar
moves to stay execution of the judgment debt it owes to QNB. Winmar
Opp’n 2. Although Winmar did not raise this request in its Motion
to Quash, it has previously requested and been denied such relief
by this Court. See Memorandum Order (“June 15 2010 Order”) (June
15, 2010) [Dkt. No. 62]. While Winmar reasserts many of the
arguments the Court rejected in its June 15, 2010 Order, it also
presents a new argument in favor of staying execution.
Specifically, Winmar argues that a stay should be granted because
QNB is “colluding” with Al Jazeera. See Winmar Inc.’s Response to
the Report and Recommendation of the Magistrate Judge, 2 (Aug. 12,
2011) [Dkt. No. 125] (“If QNB is allowed peremptorily to liquidate
the judgment against Al Jazeera at a fraction of its face value,
QNB will wipe out its sibling entity’s obligation, leaving both Al
Jazeera and QNB unjustly enriched. This would reek of collusion.”).
Winmar provides no evidence of such “collusion” and, bases its
argument, instead, on the fact that “Al Jazeera and QNB are under
the substantial ownership and control of the state of Qatar.” Id.
These are hardly grounds for asserting, let alone proving, that QNB
and Al Jazeera are engaged in collusion.

6

As QNB correctly points out, it has taken no position on Winmar’s
request to execute against the September 29, 2010 judgment, as QNB
lacks the requisite standing to do so. QNB Opp’n to Winmar Mot. to
Quash 1 n.1.
13

Federal Rule of Civil Procedure 62 governs execution upon a
judgment pending appeal. As Rule 62 makes clear, the appellant must
request a stay in order to prevent appellee from executing on the
judgment. See FED. R. CIV. P. 62(d). As Winmar correctly notes,
although “Al Jazeera has filed its notice of appeal . . . it has
posted no bond, nor has it requested that this Court enter a stay
on the execution of the [September 29, 2010] judgment.” Id. at 5.
The Court, therefore, concludes that Winmar can, in fact, execute
upon the September 29, 2010 judgment and shall grant Winmar’s
Motion.7
The Court concludes that Winmar’s Motion to Quash QNB’s Notice
of Seizure should also be granted. Through no fault of its own,
Winmar has been prevented from executing upon its judgment against
Al Jazeera. Without deciding whether D.C. law permits QNB to seize
and sell the September 29, 2010 judgment, the Court concludes that
the fairest and most appropriate course is for Winmar to be allowed
the opportunity to execute upon its judgment. Once execution has
been affected, the funds Winmar obtains will be subject to QNB’s

7

The Court notes that allowing Winmar to execute upon the
September 29, 2010 judgment does not prejudice Al Jazeera’s right
to recover those monies should it prevail on its appeal. See
Baltimore & Ohio R.R. Co. v. United States, 279 U.S. 781, 786, 49
S.Ct. 492 (1929) (“The right to recover what one has lost by the
enforcement of a judgment subsequently reversed is well
established. And, while the subject of the controversy and the
parties are before the court, it has jurisdiction to enforce
restitution and so far as possible to correct what has been
wrongfully done.”)
14

December 16, 2010 Writ of Execution. See Writ of Execution (Dec.
16, 2010) [Dkt. No. 85]; FED . R. CIV . P. 69.
III. Conclusion
For the foregoing reasons, the Court grants in part and denies
in part the Objections brought by Al Jazeera and QNB. With regard
to QNB’s Motion for a Charging Order, the Court denies the Motion.
With regard to Wimnar’s Motion to Alter or Amend, the Court grants
the Motion with the following conditions: (1) on attorneys’ fees,
the Court orders Winmar to submit a new motion for attorneys’ fees
relating only to its contract dispute with Al Jazeera; (2) on
prejudgment interest, the Court holds that prejudgment interest
shall

run

from

March

9,

2006,

in

accordance

with

the

2005

Agreement; (3) on post-judgment interest, the Court holds that
post-judgment interest shall be set at a rate of .25%; and (4) on
vacating the September 29, 2010 judgment and posting a supersedeas
bond, the Court holds that the September 29, 2010 judgment shall be
amended, rather than vacated, and that Al Jazeera shall not be
required to post a superseadeas bond at this time. With regard to
Winmar’s Motion to Quash, the Court grants the Motion to Quash

15

QNB’s Notice of Seizure and the Motion to Execute on the September
29, 2010 judgment. An Order will accompany this memorandum opinion.

/s/
Gladys Kessler
United States District Judge

September 28, 2011

Copies via ECF to all counsel of record

16