Enovative Technologies, LLC v. Gabriel Reuven Leor
Filing
291
MEMORANDUM. Signed by Judge James K. Bredar on 6/8/2015. (c/m)(hmls, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
ENOVATIVE TECHS., LLC,
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Plaintiff
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v.
CIVIL NO. JKB-14-3956
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GABRIEL REUVEN LEOR
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Defendant
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MEMORANDUM
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On May 13, 2015, Plaintiff Enovative Technologies, LLC, filed a second motion for
sanctions, contempt, attorneys’ fees, and costs. (ECF No. 178.) On May 14, the Court ordered
Defendant Gabriel Leor to respond on or before May 29, 2015, and scheduled a show cause
hearing for June 2, 2015 at 10:00 a.m. (ECF No. 179.) Defendant failed to file a response. The
hearing was subsequently rescheduled by court order (ECF No. 181), and was held on June 4,
2015 to address Plaintiff’s pending motion (ECF No. 178) and the Court’s order to show cause
(ECF No. 179). For the reasons stated in open court and explained further below, Plaintiff’s
motion for sanctions, contempt, attorneys’ fees, and costs will be GRANTED IN PART AND
DENIED IN PART.
I. Background
On January 5, the Court held a hearing to assess Plaintiff’s motion for a preliminary
injunction. (ECF No. 3.) At the end of the hearing, after considering all of the evidence
presented by both parties, the Court projected that it would grant Plaintiff’s motion and enter a
preliminary injunction order. (Prelim. Inj. Tr. at 109, Jan. 5, 2015, ECF No. 219.) The Court
then warned Defendant that “to knowingly not comply with [a preliminary injunction order]
could amount to a contempt of the Court. And contempts are punishable by various sanctions;
including in some cases even imprisonment, the loss of your liberty. Do you understand that?”
(Id. at 112.) Defendant responded: “I understand that, Your Honor.” (Id.)
On January 6, 2015, the Court issued a preliminary injunction (ECF No. 19) requiring
that Defendant immediately take the following affirmative actions: (1) transfer control of the
Magic Massage website (id. ¶ 3); (2) remove from the Internet all offensive and/or defamatory
postings relating to Plaintiff, including, but not limited to, content on http://www.smartrelief.com and http://www.magicmassageultra.com (id. ¶¶ 2, 6); and (3) return any and all of
Plaintiff’s confidential information to Plaintiff (id. ¶ 12). Defendant was also enjoined from,
inter alia, disparaging and defaming Plaintiff to any further extent (id. ¶ 1), and from harassing
or threatening Plaintiff and people associated with Plaintiff (e.g., customers, investors, etc.) (id. ¶
9).
On February 12, 2015, the Court held its first contempt hearing for alleged violations of
the preliminary injunction. Defendant was allowed to, and did, appear telephonically in this first
contempt hearing. On February 19, the Court found that Defendant had violated the Court’s
preliminary injunction order as follows: (1) Defendant failed to transfer exclusive control of the
Magic Massage website to Plaintiff; (2) Defendant failed to remove all offensive and/or
defamatory
postings
related
to
Plaintiff
on
the
www.smart-relief.com
and
www.magicmassageultra.com websites, as well as offensive postings on the “Staci Markets”
Facebook page; and (3) Defendant failed to return any and all confidential information to
Plaintiff. (ECF No. 47.) For these reasons, the Court held Defendant in civil contempt and
ordered that Defendant could only purge such contempt by complying with the Court’s
preliminary injunction order. (Id.) To coerce obedience, the Court ordered that Defendant
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would incur a daily fine of $1000, payable to the United States, until Defendant purged himself
of such contempt. (Id.)
On May 13, 2015, Plaintiff filed a second motion for sanctions, contempt, attorneys’ fees
and costs, alleging that Defendant continues to willfully violate the Court’s preliminary
injunction order. (ECF No. 178.) On May 14, the Court issued an order to show cause, directing
Defendant to respond to Plaintiff’s motion on or before May 29, and further ordering that “all
counsel of record and the Defendant SHALL PERSONALLY APPEAR” at a hearing set for
June 2, 2015. (ECF No. 179.) The next day, on May 15, the Court rescheduled this show cause
hearing to be held on June 4, 2015. (ECF No. 181.) Defendant never filed a response to
Plaintiff’s motion.
II. Findings of Fact
For the reasons stated in open court, as well as those discussed here, the Court makes the
following findings of fact:
The Court held its show cause hearing on June 4, 2015. Defendant failed to appear. As a
threshold matter, the Court finds that Defendant had adequate notice of these proceedings. The
Clerk mailed a copy of the show cause order that scheduled the hearing (ECF No. 179), and the
order rescheduling the hearing (ECF No. 181), to Defendant’s mailing address in Thailand, as
provided to the Court by Defendant. (ECF No. 34 at 4.) Further, an employee of the Court
testified that she e-mailed copies of these orders directly to Defendant’s personal e-mail address,
as a courtesy, to ensure that Defendant would receive notice of the proceedings. The Court has
previously communicated effectively with Defendant via Defendant’s personal e-mail address, at
his request. In fact, Defendant received Plaintiff’s service of the summons at this very same email address. (See ECF Nos. 9, 10, 11, 12.) Defendant failed to provide the Court with good
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cause for his failure to appear. Thus, Defendant violated the Court’s order directing that he
personally appear for the show cause hearing.
The Court proceeded to conduct the show cause hearing in Defendant’s absence upon a
finding that he had waived his right to be there and participate, and now the Court finds that
Defendant continues to violate the Court’s preliminary injunction by failing to: (1) transfer
control of the Magic Massage website; (2) remove offensive content from the Internet; and (3)
return confidential information. As of the morning of June 4, 2015, the day of the show cause
hearing, Defendant had failed to comply with the Court’s order for 104 days, accruing a total of
$104,000 payable to the United States. Defendant has exhibited an unwillingness to comply with
the Court’s order, despite the costly fine associated with such noncompliance. (The Court now
finds that continued fines would prove futile, and therefore will suspend the accrual of new daily
fines. The amount accrued to date, $104,000, remains owing to the United States.)
In addition to Defendant’s continued contempt, the Court now finds that Defendant is
responsible for a litany of harassing communications originating from Defendant’s many
pseudonymous e-mail and social media accounts, and aliases. Based on testimony presented at
the show cause hearing, the Court finds that Defendant is either directly in control of these
accounts and aliases, or that they are being used at Defendant’s direction. These accounts
include, but are not limited to: the “Magic Massage Thailand” Facebook profile,
“gabriel@smartmassageshop.com,” “guylevimassager@gmail.com,” “sellmybusiness1987@gmail.com,”
all e-mails associated with the “enovativetechnologiesllc.com” domain, the username
“peter.anderson1123,” the alias “John Collins,” and the alias “Guy Levi.”
Defendant has used these accounts and aliases to ridicule, insult, and commercially injure
Plaintiff, and to harass and intimidate Plaintiff and people associated with Plaintiff.
(See
generally ECF No. 178-4 to 178-26.) In addition to Defendant’s penchant for anonymous
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harassment, Defendant now also harasses under his own name. Defendant’s motion to disqualify
Plaintiff’s counsel devolves into obscene characterizations of Plaintiff’s counsel. (ECF No.
165.) Defendant contends that Mr. Fabian Rosado1 once referred to Plaintiff’s counsel as “the
best bitch money could buy,”2 and describes Plaintiff’s counsel’s litigation tactics as
“bitchiness.” (Id. ¶¶ 11-12.) Defendant also argues, in support of his motion to disqualify
counsel, that “[t]he legal issue now is whether ‘Fuck Her in the Pussy’ is a reference to
[Plaintiff’s counsel] herself, and not to [Plaintiff].” (Id. ¶ 12.) Defendant’s odious “allegation,”
unfortunately, requires additional context, discussed infra. Beyond those outrageous comments
appearing in Defendant’s court filing, Plaintiff’s counsel testified that Defendant recently called
her and threatened “I will fucking come after you.” Upon the testimony presented during the
hearing, some of which was in response to questioning by the Court, the Court now finds that
Defendant did in fact make these obscene characterizations and references, and the threat.
III. Analysis
With these findings, Plaintiff requests that the Court take the following actions: (1) find
Defendant in civil contempt and order that he be incarcerated; (2) sanction Defendant by
dismissing his counterclaim; (3) sanction Defendant by issuing judgment for Plaintiff; and (4)
sanction Defendant by awarding attorneys’ fees to Plaintiff. The Court addresses each request in
turn, and bases its determinations both on the reasons stated in open court as well as those
determinations of law and fact discussed here.
A. Civil Contempt; Criminal Contempt
The Court holds both that Defendant remains in civil contempt under the Court’s prior
contempt order (ECF No. 47), and that Defendant is found in civil contempt once again based on
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Mr. Rosado is “a member of [Plaintiff’s] management team.” (ECF No. 1 ¶ 34.)
After hearing testimony during the hearing, the Court does not credit this contention of Defendant and instead finds
it to be scurrilous and untrue.
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new evidence. The Court “may impose sanctions for civil contempt to coerce obedience to a
court order or to compensate the complainant for losses sustained as a result of the contumacy.”
In re Gen. Motors Corp., 61 F.3d 256, 258 (4th Cir. 1995) (internal quotation marks omitted).
Having found that an ongoing fine has proven futile, discussed supra, the Court must consider a
more severe sanction. Incarceration, like other contempt sanctions, is proper upon a finding of
civil contempt as long as the purpose is to coerce compliance with a court’s order, rather than to
punish for the contemnor’s failure to comply. See Shillitani v. United States, 384 U.S. 364, 369
(1966) (“Despite the fact that [the contemnors] were ordered imprisoned for a definite period,
their sentences were clearly intended to operate in a prospective manner—to coerce, rather than
punish. As such, they relate to civil contempt.”).
Here, Defendant continues to violate the Court’s preliminary injunction and has done so
for several months. Further, Defendant violated the Court’s orders that he respond to Plaintiff’s
motion on or before May 29, 2015, and that he personally appear for the show cause hearing.
(See ECF No. 179.) Thus, the Court will order that a warrant be issued for Defendant’s
immediate arrest and that he be held in jail as a coercive sanction for civil contempt, unless and
until he purges himself of contempt and complies with the preliminary injunction.
The Court also notes that it now may be appropriate that Defendant face a charge of
criminal contempt. Defendant has continued to harass Plaintiff and people associated with
Plaintiff, as well as to spread defamatory content about Plaintiff. He has impersonated Plaintiff’s
employees in ways that have caused harm. He has falsely stated on social media and on
Plaintiff’s now-hijacked website that Plaintiff is under investigation by the Food and Drug
Administration (“FDA”), and he may have falsely implied that an FDA official endorses
criticism of Plaintiff and its products. Defendant’s conduct appears to be willful, and in knowing
violation of the Court’s preliminary injunction order. Thus, prosecution for criminal contempt
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and imposition of punitive sanctions may be justified. This matter will be referred to the United
States Attorney for this district for his consideration.
B. Plaintiff’s Request for Sanctions: Dismissal of Defendant’s Counterclaim
Plaintiff requests that the Court dismiss Defendant’s counterclaim (ECF No. 57) as an
added sanction. “Due to the very nature of the court as an institution, it must and does have an
inherent power to impose order, respect, decorum, silence, and compliance with lawful
mandates.” United States v. Shaffer Equip. Co., 11 F.3d 450, 461 (4th Cir. 1993). “A court’s
inherent power includes the ability to order the dismissal of a case, though such orders must be
entered with the greatest caution.” Projects Mgmt. Co. v. Dyncorp. Int’l LLC, 734 F.3d 366, 373
(4th Cir. 2013). A court may dismiss a claim “when a party deceives a court or abuses the
process at a level that is utterly inconsistent with the orderly administration of justice or
undermines the integrity of the process.” Shaffer, 11 F.3d at 462. In deciding whether dismissal
of a claim is an appropriate sanction, courts typically consider six factors:
(1) The degree of the wrongdoer’s culpability; (2) the extent of the client’s
blameworthiness if the wrongful conduct is committed by its attorney, . . . (3) the
prejudice to the judicial process and the administration of justice; (4) the prejudice
to the victim; (5) the availability of other sanctions to rectify the wrong by
punishing culpable persons, compensating harmed persons, and deterring similar
conduct in the future; and (6) the public interest.
Id. at 462-63.
The Court recognizes that dismissal of claims is a severe penalty, and the Court will only
impose such a sanction under exceptional circumstances. After having carefully considered all
of the evidence, the Court finds that such exceptional circumstances are present in this case.
Defendant has shown complete disdain for the Court’s authority for several months, as evidenced
by his continuing violation of the Court’s preliminary injunction order. More significantly,
though, Defendant has now directed his animosity towards Plaintiff’s counsel.
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Regrettably, some context is necessary. At the Court’s preliminary injunction hearing on
January 5, 2015, Plaintiff presented evidence of an obscene video that Defendant had posted to
one of Plaintiff’s websites (see ECF No. 17, Ex. 19)—websites over which the Court has found
he wrongfully maintains exclusive control (see ECF No. 19 ¶¶ 2, 6). The video consisted of a
man wearing a hooded sweatshirt, interrupting multiple supposed strangers to shout “Fuck her
right in the pussy.” The Court found that the posting of this video vandalized Plaintiff’s
company website, and ordered Defendant to remove the video. (ECF No. 19.)3 Now, in
Defendant’s motion to disqualify Plaintiff’s counsel, Defendant states that “[t]he legal issue now
is whether ‘Fuck Her in the Pussy’ is a reference to [Plaintiff’s counsel] herself, and not to
[Plaintiff].” (ECF No. 165 ¶ 12.)
The Court is not unmindful that this vulgar video clip, and others like it, gained a certain
underground popularity in 2014. In fact, the gross content of the video was supposedly publicly
referenced by a prominent college athlete in the midst of a misconduct investigation. See Marc
Tracy, Jameis Winston Suspended for First Half of Florida State-Clemson Game, New York
Times
(Sept.
17,
2014),
http://www.nytimes.com/2014/09/18/sports/ncaafootball/jameis-
winston-suspended-for-first-half-against-clemson.html;
Jessica
Glenza,
Jameis
Winston
Suspended for Whole Game as FSU Extends Quarterback’s Ban, The Guardian (Sept. 20, 2014,
11:54 a.m.), http://www.theguardian.com/sport/2014/sep/20/jameis-winston-fsu-ban-commentsfootball. The Court does not comment on what value or cost, comedic or otherwise, this video
carries for society.
That said, the Court will not allow the judicial process to be subject to, or diminished by,
Defendant’s disparaging use of this vile video or its content. In filing his motion to disqualify
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The Court notes that Defendant has failed to remove this offensive content from Plaintiff’s “Staci Markets”
Facebook page (ECF No. 178-26), over which the Court finds Defendant retains control, despite the direction in the
preliminary injunction to remove all such damaging and offensive content from the Internet (ECF No. 19 ¶ 2).
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counsel (ECF No. 165), and in implying that this video in any way relates to Plaintiff’s counsel,
Defendant now attempts to use the Court’s own docketing system, and this judicial forum, as a
vehicle to harass an officer of this Court. Defendant’s “motion” is not an appropriate filing, but
rather an abhorrent screed serving no legitimate purpose in this litigation. The Court won’t
tolerate it. It will not sit idly by while Defendant uses the Court’s docket to perpetuate and
publicize his outrageous attacks on, and sexual harassment of, Plaintiff’s counsel.
Then there is the matter of Defendant’s obscene telephone threat to Plaintiff’s counsel. It
was a crude and outrageous statement made to intimidate the attorney. It was gross misconduct,
certainly worthy of a stiff sanction if not a criminal charge.
With these appalling circumstances in mind, the Court now turns to the six factors that
must be considered in determining whether the Court should dismiss Defendant’s counterclaim
as a sanction. Under the first and second factors, the Court finds that the degree of Defendant’s
culpability, and the extent of the client’s blameworthiness (as a pro se Defendant) are both
extreme. Third, Defendant’s actions have been clearly prejudicial to the judicial process and the
administration of justice. To date, months after this action was filed, the Court remains focused
only on preliminary matters such as Defendant’s conduct in litigating this matter. Defendant’s
poor conduct has kept the focus on his behavior, with little time left for litigating the actual
claims. Fourth, Plaintiff and people associated with Plaintiff have suffered considerably as a
result. Defendant has essentially stalled the Court’s proceedings, running up Plaintiff’s legal
fees all the while subjecting Plaintiff and people associated with Plaintiff to abusive harassment.
Fifth, the Court has attempted to use other, less severe sanctions to rectify the wrongs caused by
Defendant. As discussed supra, the Court instituted a daily fine after finding Defendant in civil
contempt, and Defendant continued his contemptuous behavior for the next 104 days. The Court
will now issue a warrant for Defendant’s arrest, but Defendant regularly travels abroad and it is
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not apparent if or when he will be apprehended. Dismissal of Defendant’s counterclaim is a
necessary sanction to begin to rectify the wrongs committed by Defendant in the course of this
litigation.
Finally, the public interest is served by the Court’s dismissal of Defendant’s
counterclaim. Defendant continues to waste judicial, and thus taxpayer, resources while ignoring
the Court’s orders and abusing the opposing party.
Defendant has exhibited a profound lack of respect for the Court and the judicial process,
and instead resorts to damaging and arguably criminal self-help. He disobeys and defies the
Court’s orders. With Defendant’s most recent actions, and in particular with the filing of his vile
motion to disqualify Plaintiff’s counsel, Defendant has attempted to make a crude joke of the
Court’s serious and necessary function. He has threatened opposing counsel. The Court will not
now allow Defendant to use the very system of justice that he mocks and trashes to pursue his
own claims, at least not while he continues his bad behavior. Thus, as a sanction, the Court will
dismiss Defendant’s counterclaim (ECF No. 57).
C. Plaintiff’s Request for Sanctions: Default Judgment for Plaintiff
Somewhat in conflict with the Court’s musings during the hearing, it now concludes that
default judgment is not an appropriate sanction at this time. As discussed supra, the Court
should refrain from such a severe sanction where other sanctions may rectify the wrong. Here,
the Court will issue a warrant for Defendant’s arrest, incarcerate him until he purges his
contempt, order him to pay attorneys’ fees, and dismiss his counterclaim. Such sanctions are
sufficient, for now. That said, Plaintiff may move the Court for default judgment if it can
support an allegation that Defendant is in violation of Federal Rule of Civil Procedure 37(b), or
on other provable grounds in the future, or to issue summary judgment if there are grounds.
Questions remain, however, as to what remedies would be available to Plaintiff if the Court
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eventually enters default judgment for Plaintiff. CONTRARY TO THE DIRECTION DURING
THE HEARING, no briefing on that issue is requested now.
D. Plaintiff’s Request for Sanctions: Attorneys’ Fees
Defendant must also pay Plaintiff’s reasonable attorneys’ fees for costs incurred as a
result of Defendant’s contumacy. See Gen. Motors, 61 F.3d at 258 (holding that a court may
impose sanctions “to compensate the complainant for losses sustained as a result of the
contumacy”). Before the Court will award such fees, however, Plaintiff’s counsel must submit
an affidavit in support of Plaintiff’s request for attorneys’ fees and costs, including the fractions
of hours and the work that was performed, as well as who performed the work with billing rates.
For guidance, Plaintiff’s counsel may refer to her earlier affidavit filed after the first contempt
hearing. (See ECF No. 45.)
IV. Conclusion
Accordingly, an order will issue GRANTING IN PART AND DENYING IN PART
Plaintiff’s motion for sanctions, contempt, and attorneys’ fees and costs (ECF No. 178).
DATED this _8th_ day of June, 2015.
BY THE COURT:
______________/s/____________________
James K. Bredar
United States District Judge
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