Banc Card Georgia, LLC v. United Community Bank [TV1]

Filing 24

Memorandum and Order. The Court finds that the Motion to Order Defendant to Show Cause Why It Should Not Be Held in Contempt [Doc. 14] is not well-taken, and it is DENIED. Signed by Magistrate Judge H Bruce Guyton on 8/13/14. (JBR)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF TENNESSEE
AT KNOXVILLE
BANC CARD GEORGIA, LLC,
Plaintiff,
v.
UNITED COMMUNITY BANK,
Defendant.

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No. 3:14-CV-300-TAV-HBG

MEMORANDUM AND ORDER
This case is before the undersigned pursuant to 28 U.S.C. § 636, the Rules of this Court,
and the referral of the Chief District Judge, [Doc. 19].
Now before the Court is Plaintiff’s Motion to Order Defendant to Show Cause Why It
Should Not be Held in Contempt [Doc. 14]. This motion is ripe for adjudication, and for the
reasons stated herein, it will be DENIED.

I.

BACKGROUND
Plaintiff Banc Card Georgia LLC (“Banc Card”) and Defendant United Community Bank

(“UCB”) entered into a series of agreements, whereby UCB agreed that it would refer the names
of certain of its banking customers to Banc Card. Banc Card could then offer those customers
credit, debit, and ATM card processing and settlement services. If the referred customers elected
to use Banc Card for their card processing services, Banc Card would pay a referral fee to UCB.
The parties’ contractual relationship, which began in 2003, came to an end on June 1, 2014.1

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A more thorough review of the parties’ relationship and its history is included in the Memorandum Opinion and
Order of the Chief District Judge entered July 24, 2014, [Doc. 18].

For purposes of the issue before the undersigned, there is no dispute that: (1) on and
between July 11, 2014, and July 18, 2014, a temporary restraining order (“TRO”) was in effect in
this case; and (2) in relevant part, the TRO provided that UCB was prohibited from “initiating
further contact with any of those customers acquired by Banc Card pursuant to the agreement
between the parties.”

II.

POSITIONS OF THE PARTIES
Banc Card moves the Court to enter an Order directing UCB to show cause as to why it

should not be held in contempt of Court for violation of the TRO. Banc Card argues that UCB
violated the TRO by directly contacting a customer that Banc Card had acquired pursuant to the
parties’ agreement. Specifically, Banc Card alleges that, on July 11 and July 18, 2014, Shannon
Cathey, who identified herself as an employee of UCB, contacted a representative of Horton’s
Books and Gifts (“Horton’s”) for purposes of soliciting Horton’s business for UCB. Banc Card
maintains that Ms. Cathey: contacted a representative of Horton’s on July 11, 2014; followed up
with an email to the representative of Horton’s that night, which included a merchant account
proposal; and followed up via email again on July 18, 2014, which again included a merchant
account proposal. Banc Card has submitted sworn testimony in support of its position through
the Affidavit of Tyler Cook [Doc. 16] and the Affidavit of Charles H. Geny [Doc. 15].
UCB responds that the TRO does not prohibit UCB from “directly contacting”
customers, as is implied by Banc Card. Instead, it prohibits UCB from “initiating further
contact” with such customers, and UCB denies that it initiated any contact with Horton’s or its
employees. UCB alleges that Dorothy Pittman, the owner of Horton’s came into the UCB
branch location in Carrollton, Georgia, and requested that Gina Steed have someone from UCB

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contact Ms. Pittman to provide her with information regarding UCB’s new payment services.
USB maintains that, consistent with this request, Ms. Cathey contacted Ms. Pittman via
telephone on July 10, 2014, at which time Ms. Pittman said she was busy. Therefore, Ms.
Cathey contacted Ms. Pittman on July 11, 2014. UCB contends that, during that call, Ms.
Pittman requested that Ms. Cathey send her pricing information, and Ms. Cathey emailed her the
same shortly thereafter. UCB states that Ms. Cathey contacted Ms. Pittman on July 18, 2014, to
inquire as to whether she had received the pricing information, and when Ms. Pittman said she
had not, Ms. Cathey re-emailed the information. UCB argues that Ms. Cathey did not initiate
contact with Ms. Pittman or Horton’s and that her actions did not violate the TRO. UCB has
submitted sworn testimony in support of its position through the Declaration of Gina Steed [Doc.
17-1] and the Declaration of Shannon Cathey [Doc. 17-2].
Banc Card did not file a reply in support of its position, and the time for doing so has
expired, see E.D. Tenn. L.R. 7.1.

III.

ANALYSIS
“A litigant may be held in contempt if his adversary shows by clear and convincing

evidence that ‘he violated a definite and specific order of the court requiring him to perform or
refrain from performing a particular act or acts with knowledge of the court’s order.’” American
Girl, Inc. v. Hammer, 2014 WL 3507339, at *4 (Varlan, C.J.) (E.D. Tenn. July 14, 2014)
(quoting NLRB v. Cincinnati Bronze, Inc., 829 F.2d 585, 591 (6th Cir. 1987)).
Technically, Banc Card has moved the Court to issue a show cause order, rather than
directly holding UCB in contempt. However, the ultimate issue before the Court is whether
there is a basis for finding that Banc Card has shown, by clear and convincing evidence, that

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UCB violated “a definite and specific” order of the Court. See id. The undersigned concludes
that there is no basis for so finding, and accordingly, the Motion to Order Defendant to Show
Casue [Doc. 19] will be DENIED.
There is no dispute that the TRO prohibited UCB from “initiating further contact with
any of those customers acquired by Banc Card pursuant to the agreement between the parties.”
In response to Banc Card’s motion, UCB brought forth sworn testimony that it did not initiate
contact with Horton’s, Ms. Pittman, or any other representative of Horton’s. To the contrary,
Ms. Steed stated that Ms. Pittman came into the local UCB branch and requested that someone
from UCB contact her regarding merchant payment services. [Doc. 17-1 at ¶¶ 2, 9]. Similarly,
Ms. Cathey stated that she was advised that Ms. Pittman had requested that someone from
UCB’s payment services provider contact her to discuss its services. [Doc. 17-2 at ¶ 1].
Banc Card has not offered any sworn testimony to controvert the sworn statements of Ms.
Steed and Ms. Cathey. The sworn testimony provided by Banc Card is vague and simply states
that Tyler Cook, an employee of Banc Card, received, from a representative of Horton’s on July
19, 2014, an email and attached proposal originally provided by UCB to Horton’s. Banc Card
does not submit any testimony that would support a finding that UCB initiated the contact with
Horton’s or any testimony that would otherwise undercut UCB’s version of events.
The evidence before the Court does not support a finding that UCB “violated a definite
and specific” order of the Court. The TRO issued by the Court specifically prohibited UCB from
initiating contact with Banc Share’s customers. The TRO did not prohibit UCB from having any
contact with Banc Share’s customers or from responding to inquiries by Banc Share’s customers.
The sworn testimony before the Court cannot support a finding that UCB initiated contact with
Ms. Pittman, and to the contrary, the evidence indicates that UCB merely responded to contact

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initiated by Ms. Pittman. Accordingly, the Court finds that Banc Card has failed to demonstrate
by clear and convincing evidence that UCB violated the specific terms of the TRO, and
therefore, the undersigned concludes that it would not be appropriate for the Court to issue the
requested show cause order.

IV.

CONCLUSION
For the reasons stated herein, the Court finds that the Motion to Order Defendant to Show

Cause Why It Should Not Be Held in Contempt [Doc. 14] is not well-taken, and it is DENIED.
IT IS SO ORDERED.
ENTER:

United States Magistrate Judge

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