Retail Service Systems, Inc. v. Penuel

Filing 19

ORDER, REPORT AND RECOMMENDATION, and CERTIFICATION OF FACTS: It is RECOMMENDED that (1) a show cause order be issued to Mr. Penuel to appear before the District Judge on a date certain and show cause why he should not be held in contempt for fail ing to obey Magistrate Judge Abel's January 13, 2015 Order; and (2) that Mr. Penuel be ordered to pay RSS's expenses incurred in connection with its attempts to compel his compliance with the subpoena. In addition, RSS is ORDERED to subm it an affidavit setting forth its reasonable expenses, including its attorneys' fees, incurred in connection its attempts to compel Mr. Penuel's compliance with the subpoena. Objections due within 14 days of the date of this Order. Signed by Magistrate Judge Elizabeth Preston Deavers on 5/8/2015. (mas)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION

RETAIL SERVICE SYSTEMS, INC.,
Plaintiff,

v.

Civil Action 2:14-mc-30
Judge George C. Smith
Magistrate Judge Elizabeth Preston Deavers

REID PENUAL,
Defendant.

ORDER, REPORT AND RECOMMENDATION, and CERTIFICATION OF FACTS
Plaintiff Retail Service Systems, Inc. (“RSS”) filed this miscellaneous action to enforce a
subpoena it served on third-party Florida attorney Reid Penuel. The underlying action, Retail
Service Systems, Inc. v. Carolina Bedding Direct, LLC, et al., Case Number 2:13-cv-994, is
pending in this Court. This matter is before the Court sua sponte for a Report and
Recommendation and a Certification of Facts regarding contempt pursuant to 28 U.S.C. §
636(e)(6)(B). For the reasons that follow, it is RECOMMENDED that (1) a show cause order
be issued to Mr. Penuel to appear before the District Judge on a date certain and show chase why
he should not be held in contempt for failing to obey the Court’s January 13, 2015 Order; and (2)
that Mr. Penuel be ordered to pay RSS’s expenses incurred in connection with its attempts to
compel his compliance with the subpoena. In addition, RSS is DIRECTED to submit an
affidavit setting forth its reasonable expenses, including its attorneys’ fees, incurred in
connection its attempts to compel Mr. Penuel’s compliance with the subpoena.

I.

MAGISTRATE JUDGE’S AUTHORITY REGARDING CONTEMPT

Section 636(e) of the United States Magistrate Judges Act governs the contempt authority
of magistrate judges. 28 U.S.C. § 636(e)(1) (“A United States magistrate judge serving under
this chapter shall have within the territorial jurisdiction prescribed by the appointment of such
magistrate judge the power to exercise contempt authority as set forth in this subsection.”)
Section (e)(6)(B), which applies in civil cases where the parties have not consented to final
judgment by the magistrate judge, provides as follows:
(6) Certification of other contempts to the district court.—Upon the
commission of any such act—
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(B) in any other case or proceeding under subsection (a) or (b) of this
section, or any other statute, where—
(i) the act committed in the magistrate judge’s presence may, in the
opinion of the magistrate judge, constitute a serious criminal
contempt punishable by penalties exceeding those set forth in
paragraph (5) of this subsection,
(ii) the act that constitutes a criminal contempt occurs outside the
presence of the magistrate judge, or
(iii) the act constitutes a civil contempt,
the magistrate judge shall forthwith certify the facts to a district
judge and may serve or cause to be served, upon any person whose
behavior is brought into question under this paragraph, an order
requiring such person to appear before a district judge upon a day
certain to show cause why that person should not be adjudged in
contempt by reason of the facts so certified. The district judge shall
thereupon hear the evidence as to the act or conduct complained of
and, if it is such as to warrant punishment, punish such person in
the same manner and to the same extent as for a contempt
committed before a district judge.
28 U.S.C. § 636(e)(6)(B).

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Thus, a “magistrate judge’s role on a motion for contempt in non-consent cases is to
certify facts relevant to the issue of contempt to the district judge.” Euchlid Chem. Co. v. Ware,
No. 1:11-cv-135, 2013 WL 6632436, at *1 (S.D. Ohio Dec. 17, 2013) (collecting cases
establishing the proposition). Such a certification “serves to determine whether the moving party
can adduce sufficient evidence to establish a prima facie case of contempt.” In re Warren
Easterling Litigation, No. 3:14-mc-11, 2014 WL 3895726, at *1 (S.D. Ohio Aug. 8, 2014)
(internal quotation marks and citation omitted).
II.

CERTIFIED FACTS

On July 25, 2014, RSS filed this miscellaneous action in the United States District Court
for the Middle District of Florida to enforce a subpoena it served on third-party Florida attorney
Reid Penuel. On August 4, 2014, the Florida District Court noted that it appeared that Mr.
Penuel had been personally served with the subject subpoena and ordered Mr. Penuel to show
cause in writing why RSS’s Motion to Compel should not be granted. (ECF No. 4.) On
September 18, 2014, the Florida District Court transferred the action to this Court in accordance
with Federal Rule of Civil Procedure 45(f). (ECF No. 11.) On January 13, 2015, this Court
ordered Mr. Penual to show cause within fourteen days why he should not be held in contempt
under Federal Rule of Civil Procedure 45(g) for his failure to obey the subpoena. (ECF No. 14.)
To date, Mr. Penual has not responded to the following: (1) the subpoena; (2) RSS’s Motion to
Compel (ECF No. 1); (3) the United States District Court for the Middle District of Florida’s
Order to Show Cause (ECF No. 4); or (4) this Court’s Show Cause Order (ECF No. 14).
III.

ANALYSIS

Mr. Penual’s failure to respond to the Court’s Orders constitutes disobedience of lawful
court orders and thus amounts to contempt before the magistrate judge. Rule 45(g) provides that

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“[t]he court for the district where compliance is required—and also, after a motion is transferred,
the issuing court—may hold in contempt a person who, having been served, fails without
adequate excuse to obey the subpoena or an order related to it.” Fed. R. Civ. P. 45(g).
“Contempt proceedings enforce the message that court orders and judgments are to be complied
with in a prompt manner.” IBEW v. Gary’s Elec. Serv. Co., 340 F.3d 373, 378 (6th Cir. 2003).
A party who has disobeyed a court order may be held in civil contempt if it is shown, by clear
and convincing evidence, that the party “violated a definite and specific order of the court
requiring [him or her] to perform or refrain from performing a particular act or acts with
knowledge of the court’s order.” NLRB v. Cincinnati Bronze, Inc., 829 F.2d 585, 591 (6th Cir.
1987) (quotation omitted). Once a prima facie case of contempt is established, “the burden shifts
to the contemnor who may defend by coming forward with evidence showing that he is presently
unable to comply with the court’s order.” Gary’s Elec. Serv. Co., 340 F.3d at 379. To satisfy
this burden, “a defendant must show categorically and in detail why he or she is unable to
comply with the court’s order.” Rolex Watch U.S.A., Inc. v. Crowley, 74 F.3d 716, 720 (6th Cir.
1996) (quotation omitted). The Court must also assess whether the defendant “‘took all
reasonable steps within [its] power to comply with the court’s order.’” Gary’s Elec. Serv. Co.,
340 F.3d at 379 (quoting Peppers v. Barry, 873 F.2d 967, 969 (6th Cir. 1989)).
In the instant action, the failure of Mr. Penual to respond RSS’s subpoenas and to
Magistrate Judge Abel’s January 13, 2015 Show Cause Order (ECF No. 14) constitutes contempt
before the Magistrate Judge. Accordingly, it is recommended that the District Judge issue a
show cause order to Mr. Penual to appear at a date certain to show cause why he should not be
held in contempt of court for failing to obey the January 13, 2015 Show Cause Order. It is

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further recommended that RSS be granted its attorney’s fees and expenses incurred in pursuing
compliance with the subject subpoena.
IV.

CONCLUSION

For the foregoing reasons, it is RECOMMENDED that (1) a show cause order be issued
to Mr. Penuel to appear before the District Judge on a date certain and show chase why he should
not be held in contempt for failing to obey Magistrate Judge Abel’s January 13, 2015 Order; and
(2) that Mr. Penuel be ordered to pay RSS’s expenses incurred in connection with its attempts to
compel his compliance with the subpoena. In addition, RSS is ORDERED to submit an
affidavit setting forth its reasonable expenses, including its attorneys’ fees, incurred in
connection its attempts to compel Mr. Penuel’s compliance with the subpoena. The Clerk is
DIRECTED to serve a copy of this Order and Report and Recommendation and Certification of
Facts upon attorney Reid Penuel via certified mail.
PROCEDURE ON OBJECTIONS
If any party seeks review by the District Judge of this Report and Recommendation, that
party may, within fourteen (14) days, file and serve on all parties objections to the Report and
Recommendation, specifically designating this Report and Recommendation, and the part in
question, as well as the basis for objection. 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b).
Response to objections must be filed within fourteen (14) days after being served with a copy.
Fed. R. Civ. P. 72(b).
The parties are specifically advised that the failure to object to the Report and
Recommendation will result in a waiver of the right to de novo review by the District Judge and
waiver of the right to appeal the judgment of the District Court. See, e.g., Pfahler v. Nat’l Latex
Prod. Co., 517 F.3d 816, 829 (6th Cir. 2007) (holding that “failure to object to the magistrate

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judge’s recommendations constituted a waiver of [the defendant’s] ability to appeal the district
court’s ruling”); United States v. Sullivan, 431 F.3d 976, 984 (6th Cir. 2005) (holding that
defendant waived appeal of district court’s denial of pretrial motion by failing to timely object to
magistrate judge’s report an recommendation). Even when timely objections are filed, appellate
review of issues not raised in those objections is waiver. Robert v. Tesson, 507 F.3d 981, 994
(6th Cir. 2007) (“[A] general objection to a magistrate judge’s report, which fails to specify the
issues of contention, does not suffice to preserve an issue for appeal . . . .”) (citation omitted))

Date: May 8, 2015

/s/ Elizabeth A. Preston Deavers
Elizabeth A. Preston Deavers
United States Magistrate Judge

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