Vista Food Exchange, Inc. v. Lawson Foods, LLC

Filing 308

ORDER HOLDING LAWSON FOODS, LLC AND CORPORATE OFFICER SIMON LAW IN CONTEMPT OF COURT AND IMPOSING DAILY FINES. The Court has determined that Vista's application for an adjudication of contempt should be GRANTED.Accordingly, it is hereby:ORDERE D that Simon Law, as Managing Member and the person in control of Lawson Foods, LLC, is responsible for Lawson Foods, LLC's willful pattern of contempt and non- compliance with the Court's prior contempt orders, including the final judgment not paid by Lawson Foods, LLC, and is also responsible for Lawson Foods, LLC's compliance with the terms of this Order;ORDERED that Lawson Foods, LLC, and Simon Law, solely in his capacity as Managing Member, are in willful civil contempt for L awson Foods, LLCs complete failure to timely comply with the Court's clear directive in its final Amended Judgment dated October 26, 2023 (ECF No. 277) that Lawson Foods, LLC pay to Vista Court-ordered attorney's fees for its prior civil co ntempt in the amount of $314,576.00 within 30 days of said Amended Judgment. To date, Lawson has only paid $5,810.25 towards the attorney's fees in the Amended Judgment, bringing its outstanding balance to $308,765.75;ORDERED that the Court hereby imposes civil contempt fines against Lawson Foods, LLC and Simon Law as a corporate officer to be paid to Vista Food Exchange, Inc. in the aggregate amount of $60,000.00 for the period from November 27, 2023, through December 2 7, 2023, and the daily fine amount shall be $2,000.00 per day for each date of continuing non-compliance thereafter, until all sums awarded here are paid in full;ORDERED that in addition to the daily fines awarded above, Lawson Foods, LLC is als o ordered to forthwith pay to Vista, the sum of $308,765.75 plus additional attorney's fees and expenses payable directly by Lawson to Vistas counsel Jonathan C. Scott P.C. in the amount of $241,285.00.ORDERED that the Court expressly retains jurisdiction over any and all further contempt proceedings in this case.The Clerk of the Court is respectfully directed to file this order in the related matter 21-CV-04689. SO ORDERED. (Signed by Judge Andrew L. Carter, Jr on 1/8/24) (yv) Transmission to Finance Unit (Cashiers) for processing.

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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VISTA FOOD EXCHANGE, INC.,
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Plaintiff,
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-against:
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LAWSON FOODS, LLC,
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Defendant.
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17-CV-07454 (ALC)(SN)
(Related Case Number
1:21-CV-04689-ALC)
ORDER HOLDING
LAWSON FOODS, LLC
AND CORPORATE
OFFICER SIMON LAW IN
CONTEMPT OF COURT
AND IMPOSING DAILY
FINES

ANDREW L. CARTER, JR., District Judge:
On December 19, 2023 and December 27, 2023, the Court held hearings on the
December 6, 2023 Order to Show Cause brought by Plaintiff Vista Food Exchange, Inc. to hold
Defendant Lawson Foods, LLC, and its corporate officer Simon Law in contempt and for the
imposition of sanctions. The Court has reviewed and considered the parties’ filings and
arguments.
Lawson Foods, LLC and Simon Law have set forth a defense of financial inability to
comply with the Court’s orders and judgment. “Once the movant has carried its burden and
established the three elements necessary for a finding of contempt, the burden shifts to the
alleged contemnor, who must produce evidence establishing a complete inability to pay.” United
States Sec. & Exch. Comm’n v. Bronson, No. 12-CV-6421 (KMK), 2021 WL 3167853, at *5
(S.D.N.Y. Jan. 19, 2021), motion for relief from judgment denied, 602 F. Supp. 3d 599 (S.D.N.Y.
2022), aff’d sub nom. United States Sec. & Exch. Comm’n v. Bronson, No. 22-1045-CV, 2022
WL 5237474 (2d Cir. Oct. 6, 2022), cert. denied sub nom. Bronson v. United States Sec. & Exch.

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Com’n, 143 S. Ct. 2643 (2023). “[A]n alleged contemnor who claims that he is unable to pay a
judgment, ‘bears the burden of producing evidence of his inability to comply’ with the [] order.”
United States Sec. & Exch. Comm’n v. Universal Exp., Inc., 546 F. Supp. 2d 132, 134 (S.D.N.Y.
2008) (quoting Huber v. Marine Midland Bank, 51 F.3d 5, 10 (2d Cir. 1995)). “[The] burden is
to establish his inability clearly, plainly, and unmistakably.” Huber, 51 F.3d at 10. Proof that the
contemnor “cannot pay the entire amount would not absolve him from paying as much as is
possible to pay under the circumstances[.]” Universal Exp., 546 F. Supp. 2d at 135. “At the bare
minimum, reasonable diligence requires a party to ‘pay what he or she can.’” Bronson, 2021 WL
3167853, at *7 (citing United States Sec. & Exch. Comm’n v. Musella, 818 F. Supp. 600, 602,
609 (S.D.N.Y. 1993).
Lawson produced tax returns and bank statements dated 2020-2023 in support of its
defense. The Court finds that Lawson and Law’s defense of financial inability to comply with the
Court’s orders and judgment is without merit. Lawson has not met its burden. The evidence it
submitted is insufficient, incomplete, and contradicts Lawson’s claims of financial inability to
comply. Lawson produced its tax returns for tax years 2020, 2021 and 2022, ECF Nos. 298-3 –
298-4 (Exhibits C-E); and bank statements for four bank accounts held in 2021, 2022, 2023. ECF
Nos. 298-6 – 298-18 (Exhibits F-R). Lawson’s tax returns reflect it has substantial assets:
$1,685,407 in the 2020 return; $968,653 in the 2021 return; and $742,501.00 in the 2022 return,
Exhibits C-E.
Lawson provided a transcript of Mr. Law’s testimony given during the Meeting of
Creditors on October 30, 2023, in his bankruptcy proceeding, In re Law, Case No. 23-19542SLM, pending in the District of New Jersey. ECF No. 298-2 (Exhibit B). Mr. Law testified that
Lawson is now a small outsourcing and consulting business, and is no longer a multimillion

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operation. Id. Mr. Law represented that Lawson has no assets except for “old vans” and lacks
receivables or inventory. Id. However, Mr. Law testified that Lawson pays him a monthly salary
of approximately $12,500, id. at 21, and Lawson made car payments on Law’s Tesla Model X,
id. at 14-15. Lawson’s apparent ability to foot the bill for such expenses is incompatible with
Lawson’s contention that Lawson lacks funds to comply with the Court’s orders and judgment.
Vista has provided United States Department of Agriculture (“USDA”) records, dated
December 25, 2023, stating that Lawson is a licensed USDA Classification 4 processing plant
with 1 to 10 million pounds of meat per month, ECF Nos. 303-1 – 303-2. Vista submitted the
declaration of Tim Lugar, Vice President of Sales and Marketing for Vista, ECF No. 303, who
examined the USDA pricing data, and estimated that Lawson’s monthly gross revenues on sales
is in the range of at least $644,700 per month to as much as $14,100,000 per month per million
pounds, id. ¶ 4. Lawson’s counsel represented that Lawson no longer processes meat. However,
counsel’s assertion is only supported by Mr. Law’s testimony, and they failed to provide any
other evidence demonstrating that Lawson no longer processes meat. As such, Lawson has not
met its burden to present a defense of financial inability to comply with the Court’s orders and
judgment.
The Court has determined that Vista’s application for an adjudication of contempt should
be GRANTED.
Accordingly, it is hereby:
ORDERED that Simon Law, as Managing Member and the person in control of Lawson
Foods, LLC, is responsible for Lawson Foods, LLC’s willful pattern of contempt and noncompliance with the Court’s prior contempt orders, including the final judgment not paid by

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Lawson Foods, LLC, and is also responsible for Lawson Foods, LLC’s compliance with the
terms of this Order;
ORDERED that Lawson Foods, LLC, and Simon Law, solely in his capacity as
Managing Member, are in willful civil contempt for Lawson Foods, LLC’s complete failure to
timely comply with the Court’s clear directive in its final Amended Judgment dated October 26,
2023 (ECF No. 277) that Lawson Foods, LLC pay to Vista Court-ordered attorney’s fees for its
prior civil contempt in the amount of $314,576.00 within 30 days of said Amended Judgment. To
date, Lawson has only paid $5,810.25 towards the attorney’s fees in the Amended Judgment,
bringing its outstanding balance to $308,765.75;
ORDERED that the Court hereby imposes civil contempt fines against Lawson Foods,
LLC and Simon Law as a corporate officer to be paid to Vista Food Exchange, Inc. in the
aggregate amount of $60,000.00 for the period from November 27, 2023, through December 27,
2023, and the daily fine amount shall be $2,000.00 per day for each date of continuing noncompliance thereafter, until all sums awarded here are paid in full;
ORDERED that in addition to the daily fines awarded above, Lawson Foods, LLC is
also ordered to forthwith pay to Vista, the sum of $308,765.75 plus additional attorney’s fees and
expenses payable directly by Lawson to Vista’s counsel Jonathan C. Scott P.C. in the amount of
$241,285.00.
ORDERED that the Court expressly retains jurisdiction over any and all further
contempt proceedings in this case.
The Clerk of the Court is respectfully directed to file this order in the related matter 21CV-04689.

SO ORDERED.
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Dated:

January 8, 2024
New York, New York

__________________________________
ANDREW L. CARTER, JR.
United States District Judge

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