Chevron Corporation v. Donziger et al

Filing 2602

ORDER: For the foregoing reasons, Mr. Donziger's motion to dismiss Counts One, Two, and Three of the Court's July 31, 2019 Order to Show Cause [dkt. no. 225] is DENIED. The Clerk of the Court shall close the open motion. SO ORDERED. (Signed by Judge Loretta A. Preska on 1/10/2021) (va)

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
UNITED STATES OF AMERICA,

No. 19-CR-561 (LAP)

-against-

No. 11-CV-691 (LAK)

STEVEN DONZIGER,

ORDER
Defendant.

LORETTA A. PRESKA, Senior United States District Judge:
Before the Court is Defendant Steven Donziger’s motion to
dismiss Counts One, Two, and Three of the Court’s July 31, 2019
Order to Show Cause.
dkt. no. 241.)
no. 238.)
I.

(Dkt. no. 225; see also dkt. no. 225-1;

The Government opposes the motion.

(See dkt.

For the reasons below, the motion is DENIED.

Background
The Court has already provided a high-level overview of the

lengthy procedural history of this case in a previous order.
(See dkt. no. 68 at 2-7.) 1

Consequently, the Court will

summarize only the history relevant to the instant motion here.
This criminal contempt case is an outgrowth of Chevron
Corp. v. Donziger, 11-CV-691 (S.D.N.Y.), over which Judge Lewis
A. Kaplan presides.

(Id. at 2.)

In 2014, following a lengthy

trial, Judge Kaplan issued a decision and judgment in Chevron’s
favor.

See Chevron Corp. v. Donziger, 974 F. Supp. 2d 362

1

Unless otherwise specified, all docket cites in this order
refer to dkt. no. 19-CR-561.
1

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(S.D.N.Y. 2014).

Four years later--following the Court of

Appeals’ affirming that judgment and the Supreme Court’s denying
certiorari--Judge Kaplan issued a supplemental judgment for
costs in the amount of $813,602.71 against Mr. Donziger and
others.

(See dkt. no. 1962 in 11-CV-691 at 2.)

On March 5, 2019, as part of the post-judgment discovery
proceedings, Judge Kaplan issued an order (the “Protocol Order”)
establishing a protocol to govern the collection, imaging, and
examination of Mr. Donziger’s electronic devices.
2172 in 11-CV-691.)

(See dkt. no.

That order required Mr. Donziger to, inter

alia: (1) provide a list of all his electronic devices and
accounts to an appointed forensic expert, (id. ¶ 4); and (2)
surrender those devices to the forensic expert for imaging, (id.
¶ 5).

Mr. Donziger did not comply with either directive,

informing the expert that he would not do so “until [his] due
process rights [we]re respected.”

(Dkt. no. 2173-1 in 11-CV-691

at 2.)
A few months later, Judge Kaplan issued another order (the
“Passport Surrender Order”) directing Mr. Donziger to surrender
his passport(s) to the Clerk of the Court.
in 11-CV-691 at 2.)

(See dkt. no. 2232

That order was imposed as a coercive civil

contempt sanction, in addition to a series of coercive fines,
based on Mr. Donziger’s noncompliance with the Protocol Order.
(See id. at 1-2.)

Mr. Donziger filed an emergency motion to
2

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stay the contempt sanctions pending an appeal, (see dkt. no.
2234 in 11-CV-691), which Judge Kaplan granted in part and
denied in part on July 2, 2019, (see dkt. nos. 2252, 2254 in 11CV-691).

In so ordering, Judge Kaplan again directed Mr.

Donziger to surrender his passports and declined to stay the
Protocol Order pending appeal.
at 3.)

(See dkt. no. 2254 in 11-CV-691

Mr. Donziger still did not comply and did not seek a

stay or a writ of mandamus from the Court of Appeals.
On July 31, 2019, Judge Kaplan issued an order, pursuant to
Federal Rule of Criminal Procedure 42, directing Mr. Donziger to
show cause why he should not be held in criminal contempt, in
violation of 18 U.S.C. § 401(3). (See dkt. no. 2276 in 11-CV691.)

That order to show cause, which was made returnable

before the undersigned, cited six charges for criminal contempt.
(See id. ¶¶ 1-21.)
On February 27, 2020, Mr. Donziger sought pre-trial relief
on several grounds, including, inter alia, dismissal of the
criminal contempt charges.

(See dkt. no. 60 at 24-33.)

Government opposed that motion.

The

(See dkt. no. 62 at 27-32.)

On

May 7, 2020, the Court denied the motion, finding that (1) many
of Mr. Donziger’s fact-based contentions could only be resolved
at trial and (2) his remaining legal arguments were not
supported by the governing law.

(See dkt. no. 68 at 20-24.)

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On December 16, 2020, Mr. Donziger again moved to dismiss
the criminal contempt charges but this time sought dismissal of
only Counts One, Two, and Three.

(See dkt. no. 225.)

Those

counts allege Mr. Donziger’s refusal to (1) provide a list of
his electronic devices and accounts in violation of paragraph 4
of the Protocol Order, (dkt. no. 2276 in 11-CV-691 ¶¶ 1-3); (2)
turn over those devices to the forensic expert for imaging in
violation of paragraph 5 of the Protocol Order, (id. ¶¶ 4-6);
and (3) surrender his passports as required by the Passport
Surrender Order, (id. ¶¶ 7-9.).

Like Mr. Donziger’s previous

motion to dismiss, the Government opposes the instant motion.
(See dkt. no. 238.)
II.

Discussion

When addressing a motion to dismiss criminal contempt
charges, the Court must take factual allegations in the charging
instrument as true.

See, e.g., United States v. Hogan, Nos. 07

Cr. Misc. 1 (LAP) & 88 Civ. 04486 (LAP), 2009 WL 3817006, at *3
(S.D.N.Y. Nov. 12, 2009).

Disputes regarding the facts

underlying the contempt charges are properly resolved at trial,
not on a motion to dismiss.

See, e.g., United States v. Cutler,

815 F. Supp. 599, 610 (E.D.N.Y. 1993).
18 U.S.C. § 401(3) empowers a federal court “to punish by
fine or imprisonment, or both, at its discretion, such contempt
of its authority, and none other, as . . . [d]isobedience or
4

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resistance to its lawful writ, process, order, rule, decree, or
command.”

18 U.S.C. § 401(3).

Notably, that statute does not

offer any qualifications on the type of order for which criminal
contempt may be charged or impose any temporal limitations on
when the charges may be levied.
The Supreme Court has long recognized, however, that the
“judicial contempt power is a potent weapon” that should be
exercised with care.

Int’l Longshoremen’s Ass’n, Local 1291 v.

Phila. Marine Trade Ass’n, 389 U.S. 64, 76 (1967).

In that

vein, the Court has provided for many limitations on courts’
contempt powers. 2

Despite those limitations, the High Court has

established a clear baseline rule regarding litigants’
obligations to obey court orders:
We begin with the basic proposition that all orders
and judgments of courts must be complied with
promptly. If a person to whom a court directs an
order believes that order is incorrect the remedy is
to appeal, but, absent a stay, he must comply promptly
with the order pending appeal. Persons who make
private determinations of the law and refuse to obey
an order generally risk criminal contempt even if the
order is ultimately ruled incorrect.
Maness v. Meyers, 419 U.S. 449, 458 (1975) (emphasis added).
When confronted with disobedience of its order, “the choice of
sanctions--civil or criminal--is vested in the discretion of the

2

For example, the Supreme Court has held that “criminal
contempt sanctions are entitled to full criminal process.”
Int’l Union, United Mine Workers of Am. v. Bagwell, 512 U.S.
821, 833 (1994).
5

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District Court,” Dinler v. City of New York (In re City of New
York), 607 F.3d 923, 934 (2d Cir. 2010), and the same “conduct
can amount to both civil and criminal contempt,” United States
v. United Mine Workers of Am., 330 U.S. 258, 299 (1947).
To get out from under that baseline rule, Mr. Donziger
invokes what he describes as a well-trodden exception for
production orders: “A party who is willing to risk civil
contempt to seek appellate review of a production order cannot
be held in criminal contempt pending appellate review.”
no. 225-1 at 2-3.)

(Dkt.

Central to Mr. Donziger’s argument is his

contention that production orders differ from other court
orders--such as injunctions or orders for testimony--for the
purpose of contempt because “they compel affirmative,
irreversible acts.”

(Id. at 5.)

For support, Mr. Donziger

relies on four Supreme Court cases which he maintains implicitly
establish that principle: (1) Alexander v. United States, 201
U.S. 117 (1904); (2) Cobbledick v. United States, 309 U.S. 323
(1940); (3) United States v. Ryan, 402 U.S. 530 (1971); and (4)
Maness.

(See id. at 3-5.).

But Mr. Donziger misreads those

cases; they do not establish the rule for which he advocates.
In Alexander, 201 U.S. at 121–22, the Court held that it
lacked jurisdiction because the judicial order--which required
witnesses to appear before a special examiner to answer
questions and produce documents--was not “final” and thus was
6

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not appealable.

Likewise, in Cobbledick, 309 U.S. at 324, 327-

29, the Court held, relying on Alexander, that an order denying
a motion to quash a subpoena duces tecum also was not
appealable.

In both cases, the Court suggested that the witness

could obtain review of the order by refusing to comply, subject
to possible contempt proceedings. 3

Importantly, though, the

Court did not limit the type of contempt to which the witnesses
could be subjected.

To the contrary, Alexander appears to

contemplate that a contemnor could face criminal sanctions. 4
Nor does Ryan limit a court’s power to charge criminal
contempt.

Exactly like Cobbledick, Ryan, 402 U.S. at 530–32,

held that a district court’s order denying a motion to quash a
subpoena requiring production of documents to a grand jury was
not appealable.

Moreover, like Alexander and Cobbledick, Ryan

suggested that a litigant could obtain review of that subpoena
by “refus[ing] to comply” and then litigating whether the

3

See Alexander, 201 U.S. at 121 (“Let the court go further,
and punish the witness for contempt of its order, then arrives a
right of review, and this is adequate for his protection without
unduly impeding the progress of the case.”); Cobbledick, 309
U.S. at 328 (“Whatever right he may have requires no further
protection . . . than that afforded by the district court until
the witness chooses to disobey and is committed for contempt.”).
4

See Alexander, 201 U.S. at 121 (indicating that the court
could “punish the witness for contempt of its order” (emphasis
added)); see also Bagwell, 512 U.S. at 828 (observing that the
Court had historically described the purpose of criminal
contempt as “punitive”).
7

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subpoena was “unduly burdensome or otherwise unlawful . . . in
the event that contempt or similar proceedings [we]re brought
against him.”

Id. at 532.

But, again like Alexander and

Cobbledick, Ryan did not limit the type of contempt that could
be charged.

Instead, in expressly distinguishing Walker v. City

of Birmingham, 388 U.S. 307 (1967), the Court merely observed
that the collateral bar rule 5 would not preclude the subpoenaed
party from litigating the lawfulness of the subpoena in related
contempt proceedings.

See Ryan, 402 U.S. at 532–33 & n.4.

Finally, Maness, 419 U.S. at 470, held that an attorney
could not “suffer any penalty” of contempt for advising his
client “in good faith” not to surrender subpoenaed documents on
Fifth Amendment self-incrimination grounds.

In reaching that

conclusion, the Court, citing Alexander, Cobbledick, and Ryan,
recognized that the attorney could obtain pre-compliance review
of the subpoena by refusing to comply and subjecting himself to
contempt.

See id. at 460-61.

But again, like Alexander,

Cobbledick, and Ryan before it, Maness did not purport to limit

5

The collateral bar rule recognizes “that a defendant
generally is barred from collaterally attacking the
constitutionality of a court order as a defense to his criminal
contempt prosecution.” United States v. Terry, 17 F.3d 575, 579
(2d Cir. 1994) (citing Walker, 388 U.S. at 314–15). Rather,
“[t]he appropriate method for challenging the validity of a
court order is to petition to have the order vacated or
amended.” Id. Notably, though, Walker, 388 U.S. at 309,
involved a challenge to a “temporary injunction.”
8

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the type of contempt that a court may charge for failure to obey
its order.

In fact, although the Supreme Court did not

explicitly state as much, the contempt charged in Maness appears
to be of the criminal variety. 6

Importantly, as stated above,

the Supreme Court ultimately reversed that contempt conviction
on the merits.

Id. at 470.

As a critical component of his argument, Mr. Donziger
assumes that he “cannot be relieved of a conviction for criminal
contempt even when the validity of the underlying order is
rejected on appeal.”

(Dkt. no. 225-1 at 6.)

That is somewhat

surprising, given that he argued in his opposition to the
Government’s motion in limine that the collateral bar rule would
not preclude review of the lawfulness of at least some of the
judicial orders underlying the contempt charges in this case.
(See dkt. no. 110 at 10-14.)

In any event, the Court has

“defer[red] ruling on the collateral bar issue until trial, when
the Court will have the benefit of a fuller factual record.”
(Dkt. no. 191 at 2.)

No further discussion of the matter is

necessary here.

6

See Maness, 419 U.S. at 455, 457 (noting that the trial
court “fixed punishment . . . at 10 days’ confinement and a $200
fine” and that “the penalty” was later changed “to a $500 fine
with no confinement” (emphasis added)); see also Bagwell, 512
U.S. at 828-29 (stating that “a fixed sentence of imprisonment
is punitive and criminal if it is imposed retrospectively for a
completed act of disobedience” and observing a similar rule for
“flat, unconditional fine[s]” (quotation marks omitted)).
9

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In sum, the cases on which Mr. Donziger relies do sanction
an avenue whereby a litigant may obtain review of certain court
orders, such as a subpoena duces tucem, by refusing to comply
and risking contempt.

But they do not limit a court’s

discretion as to what flavor of contempt to impose. 7
from the Court of Appeals supports that principle. 8

The caselaw
Accordingly,

Mr. Donziger is not entitled to a dismissal.

7

The other cases Mr. Donziger cites provide him no more
help. (See dkt. no. 225-1 at 5-6.) Although in some of those
cases the district court imposed civil contempt rather than
criminal, those cases do not limit a district court’s discretion
to impose criminal contempt. See, e.g., United States v.
Beckerman, 1999 WL 97237, at *1 (2d Cir. Feb. 24, 1999) (summary
order) (not discussing the type of contempt a court can charge
for failure to violate its order); Chevron Corp. v. Berlinger,
629 F.3d 297, 306 (2d Cir. 2011) (same).
8

See, e.g., Del Carmen Montan v. Am. Airlines, Inc. (In re
Air Crash at Belle Harbor), 490 F.3d 99, 104 (2d Cir. 2007)
(“[T]he remedy of the party witness wishing to appeal is to
refuse to answer and subject himself to criminal contempt.”
(quoting Nat’l Super Spuds, Inc. v. N.Y. Mercantile Exch., 591
F.2d 174, 177 (2d Cir. 1979) (Friendly, J.)); Stolt-Nielsen SA
v. Celanese AG, 430 F.3d 567, 574 (2d Cir. 2005) (“[I]n a
criminal or civil proceeding, a witness wishing to contest a
subpoena must usually disobey the subpoena, be held in civil or
criminal contempt, and then appeal the contempt order.”).
Mr. Donziger’s attempts to discount those authorities, (see
dkt. no. 225-1 at 7 n.3), are unavailing. Instead, those
authorities recognize that, in the mine run of cases involving
production orders, merely going into civil contempt is not
enough to obtain appellate review. Indeed, when a contemnor is
a party to the case--as Mr. Donziger was in the civil case
before Judge Kaplan--he can generally “only appeal a civil
contempt sanction after a final judgment.” Dinler, 607 F.3d at
934. In contrast, only an “order of criminal contempt” is
immediately appealable. Id.
10

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III. Conclusion
For the foregoing reasons, Mr. Donziger’s motion to dismiss
Counts One, Two, and Three of the Court’s July 31, 2019 Order to
Show Cause [dkt. no. 225] is DENIED.

The Clerk of the Court

shall close the open motion.
SO ORDERED.
Dated:

January 10, 2021
New York, New York

__________________________________
LORETTA A. PRESKA
Senior United States District Judge

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