Schwartz v. Rent-A-Wreck of America, Inc.
MEMORANDUM OPINION. Signed by Judge Peter J. Messitte on 6/29/2017. (aos, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
Plaintiffs and Counter-Defendants
OF AMERICA, et al.,
Civil No. I'JM 07-1679
Rent-a- Wreck is a nationwide
in the short and mid-
tenn rental of used automobiles.
10 years, David Schwartz,
and Bundy American,
of a RAW A franchise
of the concept,
for present purposes
appeals to the Fourth Circuit, the rights and obligations
"RAW A"), have been doing battle
and as to which the Court must now consider
history of the case is long.
in West Los Angeles,
and Rent A Wreck,
it is suf1icient
to say that, after two
of the parties have been fully established.
Schwartz filed suit against RA WA in June 2007. In the last iteration of the Complaint, Schwartz sued
for declaratory judgment, specitlc performance, and breach of contract. In response, RA WA filed various
counterclaims, one of which asserted that the Schwartz franchise violated California competition law and
constituted an unlawful restraint on trade. The parties' claims proceeded to trial in April 2010. The jury
found that Schwartz had a contract with RA WA with respect to Schwartz's operation of a used car rental
business in West Los Angeles and that the contract afforded Schwartz the exclusive right to operate a
RA WA franchise in West Los Angeles. RA WA subsequently moved under Federal Rule ofCi"il
Procedure 50 to set aside portions of the jury's verdict, arguing, among other things, that California
competition law rendered the exclusivity provision void ab initio. The Court denied RA WA's Rule 50
Motion and entered a Final Order of Declaratory Judgment on September 23,2010. ECF No. 344. On
appeal. on March 9, 2012, the United States Court of Appeals for the Fourth Circuit issued an opinion
After the second appeal became
filed a Bill of Costs, seeking
in favor of Schwartz
to this Court, Schwartz
that it reduce
RAW A's Motion
the Clerk of Court
RAW A in the amount
ECF No. 525. RAW A then filed a Motion to Review Clerk's
RAW A asked that the Court reject
final and the case was remanded
Bill of Costs
award of costs by $4,442.83.
Order Taxing Costs, in
in its entirety
or. in the
ECF No. 526. The Court
and on July 12, 2016, aftinned
Costs. ECF Nos. 535-36. RAW A did not appeal the Order, but did not promptly
pay the ordered
On May 3, 2016, Schwartz
filed a Motion
ECF No. 528, which the parties briefed.
Hearing at which it found RA WAin
RAW A deliberately
and status reports,
Order and for Contempt.
30, 2016, the Court held a Show Cause
of the Court's
Order of March 4, 2011, in that for
its call center
that RAW A had no franchise
in what was Schwartz's
up to a second
27, 2017. See
ECF Nos. 529 - 567.
affinning in part, vacating in part, reversing in part, and remanding the case for further proceedings. ECF
No. 395. Of immediate relevance, the Fourth Circuit instructed the Court to submit to ajul)' the question
of whether the exclusive territoI)' provision of Schwartz's contract foreclosed competition in a substantial
share of the market for rental cars, and therefore whether Schwartz's franchise was void under California
law. as asserted by RA WA. After the second jul)' trial, the jul)' found that Schwartz's exclusive territorY
agreement did 1101 foreclose competition in a substantial share of the market for rental cars and
accordingly, the Court entered a Final Order of Judgment on Remand in favor of Schwartz on RA WA' s
counterclaim. On March 10, 2015, the Fourth Circuit issued an opinion affinning the Judgment. ECF No.
517. That court's mandate issued on April 2, 20 I5. ECF NO.5 I9.
2 At the September 30, 2016 hearing, after the Court inquired as to the maner, counsel for RA WA handed
Schwartz's counsel a check for $13,405.11 to cover the court-ordered costs. The fact that RAWA waited
until the filing of Schwartz' Motion and the day of the hearing to make the tender was yet another
indication of RA WA's apparent strategy, proclaimed at the outset by RA WA's principal operative, Jack
Fitzgerald, to make Schwartz sweat at virtually eveI)' stage of the proceedings.
For the reasons
stated on the record at the September
and as further set forth in this Memorandum,
and for Contempt,
ECF No. 528, will be
30, 2016 and February
IN PART and DENIED IN
It is well-established
Chambers v. NASCa, Inc., 501 U.S. 32,44,
(3) that the alleged contemnor
(at least constructive
each of the following
of a valid
(2) that the decree
by its conduct
S.Ct. 2123, lIS L.Ed.2d
party must establish
of civil contempt."
was in the movant's
the terms of the decree, and had
of such violations;
and (4) that movant
by clear and convincing
shins to respondent
Redner's Markels, Inc. v. .Ioppalowne G.P. Ltd. P'ship, 608 F.
130, 131 (4th Cir. 2015).
harm as a result. Ashcraft v. ConoCO, Inc., 218 F.3d 288, 301 (4th Cir. 2000). "Willfulness
has the initial burden of showing
if he meets that burden,
to raise a defense on an appropriate
Uniled Stales v. Darwin Consl.
3 The Court's finding of contempt is confined to RA WA and not its counsel. That said. as has been
expressed several times in the course of this case, the Court has concerns that the hand of RA WA's
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