Duracell Inc. v. Golbal Imports, Inc.

Filing 106

ORDER ADOPTING REPORT AND RECOMMENDATIONS for 94 Report and Recommendations., The Court has reviewed the issues raised by Duracell for "clear error" and found none. Accordingly, the Court adopts the Report in its entirety. The Clerk of Court is respectfully requested to close the case. SO ORDERED. (Signed by Judge Ronnie Abrams on 2/12/2019) (rj) Transmission to Orders and Judgments Clerk for processing.

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

USDC-SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC#:
DATE FILED:
I } / ( C)

J/

DURACELL INC.,
Plaintiff,
V.

GLOBAL IMPORTS, INC.,

No. l 7-MC-185
ORDER ADOPTING REPORT AND
RECOMMENDATION

Defendant.

RONNIE ABRAMS, United States District Judge:
On June 5, 2017, Plaintiff Duracell Inc. filed a motion for contempt against Defendant
Global Imports, Inc., ("Global Imports") alleging that Defendant had violated a July 8, 1983
consent judgment in which it agreed not to "import[], buy[], sell[], or otherwise dispos[ e] of
batteries manufactured abroad by plaintiff Duracell Inc." Dkt. 3-1, Ex. B. According to
Plaintiff, from January to mid-2017, Defendant violated the consent judgment by selling
Chinese-manufactured Duracell batteries to customers in the United States. See Pl 's. Mem. at 1,
Dkt. 2. This Court subsequently granted Plaintiff's motion for contempt, and referred the case to
Magistrate Judge Fox to determine the appropriate sanctions against Defendant.· See Dkt. 20.
On August 16, 2018, Judge Fox issued a Report and Recommendation (the "Report")
advising the Court to grant Plaintiff $129,172.33 in compensatory damages and to order
Defendant to surrender to Plaintiff its inventory of the offending batteries. See Report at 27, Dkt.
94. On August 23, 2018, the parties requested a three-week extension to file their objections to
the Report, Dkt. 95, which the Court granted, Dkt. 96. On September 13, 2018, Defendant

* On December 20, 2017, Judge Sullivan denied Plaintiff's additional motion to hold Defendant in contempt for
selling a different set of batteries to U.S. customers that were manufactured abroad. See Dkt. 66.

timely objected to the Report. See Dkt. 97. Plaintiff responded to Defendants' objection on
September 17, 2018, including objections of its own. See Dkt. 98. On January 3, 2019, this
Court requested supplemental briefing on Defendants' objection to the Report, see Dkt. 101,
which was completed on February 1, 2019, see Dkts. 102-05.
"A district court reviewing a magistrate judge's report and recommendation 'may accept,
reject, or modify, in whole or in part, the findings or recommendations made by the magistrate
judge."' Hancockv. Rivera, No. 09-CV-7233 (CS)(GAY), 2012 WL 3089292, at *1 (S.D.N.Y.
July 30, 2012) (citing 28 U.S.C. § 636(b)(l)(C)). "A district court must conduct a de nova review
of those portions of the report or specified proposed findings or recommendations to which
timely objections are made." Id "The district court may adopt those portions of a report and
recommendation to which no timely objections have been made, provided no clear error is
apparent from the face of the record." Id "In addition, '[t]o the extent ... that the party makes
only conclusory or general arguments, or simply reiterates the original arguments, the Court will
review the Report strictly for clear error."' Id (quoting IndyMac Bank, FS.B. v. Nat'! Settlement
Agency, Inc., No. 07-CV-6865, 2008 WL 4810043, at *1 (S .D.N.Y. Nov. 2, 2008)) (alterations
in original).
According to Defendant, Duracell was aware in January 2017 that Global Imports was
breaching the consent judgment, but "waited until April to first contact Global and then waited
even longer, until late May," to identify the batteries at issue. Def. 's Objections at 4. Defendant
therefore asserts that Duracell "should not be entitled to Global's sales [from January to April
2017], because such harm was due to [Duracell's] failure to promptly notify Global and mitigate
damages." Id For the same reason, Defendant contends that it should not be required to tum

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over any inventory purchased in that timeframe absent a credit, because it would not have
purchased such items had Duracell promptly notified Defendant that it was in breach of the
consent judgment. See id. at 4-5.
In response, Plaintiff argues that it had no legal obligation to mitigate damages under the
consent judgment. See Pl.'s Response at 3-4. Duracell further contends that, if the Court
sustains Defendant's objection, it should find that Judge Fox committed clear error by (1) not
trebling the amount of damages against Defendant for its misconduct, id. at 4-5, and (2) reducing
the amount of attorney's fees requested by Duracell, id. at 5-12.
The Court agrees with Duracell that its damages award should not be reduced on the
basis that it waited approximately three months from its discovery of Global Imports' breach of
the consent judgment to inform Defendant of its misconduct. Defendant "was on notice of its
obligations under the consent [judgment] from the time of its entry, and yet [did not take]
meaningful steps to ensure its compliance with those provisions." Fendi Adele S.R.L. v.

Burlington Coat Factory Warehouse Corp., 642 F. Supp. 2d 276,296 (S.D.N.Y. 2009). Indeed,
the harm caused by Global Imports' sale of the batteries at issue was not, as Defendant insists,
"due to [Duracell's] failure to promptly notify Global and mitigate damages," Def. 's Objections
at 4; it was due, rather, to Global Imports' violation of the consent judgment. In any event, the
Court does not consider Plaintiff's three-month delay in directly contacting Defendant to be an
umeasonable failure to mitigate damages given the time necessary for Duracell to determine the
extent of Global Imports' prohibited sales and to decide what course of action to take.
As for Plaintiff's arguments that Judge Fox erred in calculating the amount of damages to
which Duracell was entitled, these contentions were made after the deadline to object to the

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Report, see Dkt. 98, and were therefore untimely. "Where no timely objection has been made ...
a district court need only find that there is no clear error on the face of the record in order to
accept the Report and Recommendation." Pineda v. Masonry Const., Inc., 831 F.Supp.2d 666,
670 (S.D.N.Y. 2011) (internal quotation marks omitted). The Court has reviewed the issues
raised by Duracell for "clear error" and found none.
Accordingly, the Court adopts the Report in its entirety. The Clerk of Court is
respectfully requested to close the case.

SO ORDERED.
Dated:

February 12, 2019
New York, New York
Ro~'"'"'= _,,, rams
United States District Judge

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