Transperfect Document Mgt., Inc. v Collard

Annotate this Case

Download PDF

Transperfect Document Mgt., Inc. v Collard 2012 NY Slip Op 30183(U) January 25, 2012 Sup Ct, NY County Docket Number: 116290/10 Judge: Joan A. Madden Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. [* 1] SCANNED ON 112612012 SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY PRESENT: PART MhJbW Il Justice The following papers, numbered 1 to were read on this motion to/for PAPCRS NUMBERED Notice of Motion/ Order to Show Cause Answering Affidavits - Affidavits - Exhibits ... - Exhibits Replying Affidavits Cross-Motion: Dated: d 60 ( c> 3 ; No "/ 2 dLa H Check one: DISPOSITION J.s. c. JOAN A. MADDEN NON-FINAL DISPOSReN u Check if appropriate: fl DO NOT POST REFERENCE c? SETTLE ORDER/ JUDG. SUBMIT ORDER/ JUDG. [* 2] Plaint iff, INDEX NO. 1 16290/10 -against- PETER M. COLLARD, JR., Dcfendant , JOAN A. MADDEN, J.: NEW YORK k7ChJp TY CLE K S OFF CE ?\ d Plaintiff Transperfect Documcnt Management, Inc. ( TransPerl ect ) moves or an or er: I ) pursuant to Judiciary Law 9753(A)(3) and CPLR 5104, holding delendant Peter M. Collard, Jr. and non-party Modus, LLC ( Modus ) in civil contempt for willful violation of the Stipulation and Order of Settlement so-ordered by this court on March 29, 201 1 (thc Order or the so-ordcred stipulation ); 2) pursuant to Judiciary Law (3773 imposing damages against Collard and Modus for their contempt of thc Order, including the maximum statutory fine of $250.00, and plaintiiys costs and expenses in connection with this motion, including reasonable attorney s fees; 3) extending the non-solicitation period for an additional two months; 4) requiring Collard and Modus to submit to depositions and document discovery concerning thc extcnt to which they havc allcgedly violated thc Order; and 5 ) providing that any further violations of the Order shall bc punishable by imprisonment. Defendant Collard and non-party Modus oppose the motion, and Modus cross-moves for an order pursuant to Rule 130.1 imposing sanctions against plaintiff for frivolous conduct. By a separate notice of cross-motion, Modus seeks an order vacating the court s February 9,201 1 1 [* 3] prcliminary injunction ordcr and dismissing this action for failure to state a claim upon which relief can be grantcd, and alternatively, an ordcr modifying the court s February 9, 201 1 order so as to identify those speciGc customers to which it applies upon agreement of the parties and Modus or submission of proof by clear and convincing evidcnce by Plaintiff. Collard submits a Notice of Joinder stating that he joins in the cross-motion by Modus to vacate or modify thc court s February 8, 201 1 preliminary injunction order. Defendant Collard was employed by plaintiff TransPerfcct from July 2008 through December G,20 10. On December 16,2010, Transperfect commenced thc instant action for jnjunctive rclicf and damagcs, asserting claims for brcach of contract, misappropriate of confidential information, breach of fiduciary duty and duty of loyalty, and unfair competition. By a decision and order dated February 15,201 I , this court granted TransPerfect s motion for a prcliminary injunction. On March 16, 20 1 1, the parties executed a Stipulation and Order of Settlement, which this court so-ordered on March 29,201 1; the parties also exccuted a Stipulation of Discontinuance with Prcjudice. On or about June 20,201 1, Transperfect made the instant motion by order to show causc, pursuant to Judiciary Law $ 753(A)(3) and CPLR 5104, seeking to hold Collard and his current employer, Modus, in civil contempt for willful violation of the stipulation of settlement. ? ransPerfect alleges that Collard on behalf of Modus improperly solicited Covington & Burling LLP ( Covington ), a TransPerfect customer that Collard had serviced during the last ycar of his employment at TransPerfect, in clear violation of the following provision in the so-ordered I This provision originally appeared in the court s February 9,20 I 1 order, which grantcd Transl crfcct s motion for a preliminary injunction. The parties Stipulation and Order of Settlement states that the Preliminary Injunction Order shall become a permanent injunction that 2 [* 4] stipulation: [Dlefendant Pcter M. Collard, Jr. ( Collard ) is enjoined dircctly or indirectly, alone or in concert with others, including his new employer Modus, from soliciting any customers of TransPerfcct for whom or to whom Collard provided TransPerl ect services, products, or to whom Collard provided a quotation, estimate or proposal for the sale 01. Transperfect products afier activc solicitation by Collard during the last year of his employment with Transperfect; however, Collard is not enjoined from soliciting Transperfect clients with whom he had a preexisting relationship with and who came to Transperfect solely to avail themselves of Collard s services and only as a result of his own, independent rccruitment efforts, which TransPerfecl neither subsidized nor financially supported in other than a de minimis way as part of client development , , . In support of the motion, TransPerikct submits an affidavit from A. Brooke Christian, Senior Vice President o f Global Sales for Transperfect Translations International, Inc. and its affiliated Fdrnily of companies. Mr. Christian explains that Following Collard s departure, I ransPerfcct arranged to have ernails sent to Mr. Collard s work einail account auto-forwarded to other TransPerfcct employees in order to ensure that client requests did not go unanswercd. According to Christian, on June 10, 201 1 at 8:26 am., an cinail was sent from Covington & Burling ( Covington ), a Transperfect customer, to Mr. Collard s TransPerikct ernail account, indicating that Mr. Collard would be meeting with that customer, and later that day at 1 :04 p.m., Collard sent an ernail to Christopher Cantwell of Covington, entitled Modus Cube Lunch Presentation, which stated in its entirety, as follows: IIi Chris, thanks again for taking the time to catch-up! We would like to request the opportunity lo do a Modus Cube demo for the LLS team during your weekly will remain binding and in @ct through und including December 6, 201 I ; provided, however, that Mr. Collard s obligations not to directly or indirectly, alone or in concert with others, including his new employer Modus, use in any way or disclosc to any person Transperfect s confidential, proprietary or trade secret information shall continue to remain in effect following December 6, 201 1, so long as such information remains confidential (emphasis added). 3 [* 5] Wednesday lunch at the next available time. Thanks in advance for consideration. Have a good weekend! Thanks, Petc Cantwell replied to Collard by copying him on an email addressed to Elizabeth Garnette, slating: Hi Liz, Could you please check the LSS meeting calendar and let Pete [Collard] know when he can come to dcrno Modus s Cube? Thanks, Chris. Relying on Collard s email to Cantwell, Transperfect asserts that Collard improperly and affirmatively solicited Covington, a TransPcrfect client, for business on behalf of Modus, his new employer, which has clearly prejudiced Transperfect s rights. TransPerfect also asserts that Covington does not fall within the exception to the order, as quoted above, because Covington was a client of Transperfect for several years prior to the cornmenccment of Collard s employment, and could not possibly have come to Transperfect solely to avail itscli of Mr. Collard s serviccs. Based on the loregoing, Transperfect asserts that Collard and Modus should be held in civil contempt of court for violating thc so-ordered stipulation. Contempt is a drastic remedy, which should not issue absent a clear right to such rclief. -Coronet Capital Co. v Spodek, 202 AD2d 20 (1 Dept 1994); Usina Costa Pinto, S.A. v See Sanco Sav Co. Ltd., 174 AD2d 487 (1 Dept 1991). A motion to punish a party for civil contempt is addressed to the sound discretion of the motion court. Chambers v. Old Stone Hill Road Associates, 66 AD3d 944, 946 (2 ldDept 2009), app dism 14 NY3d 747 (2010). To sustain a linding of civil contempt bascd on an alleged violation of a court order, the moving party has the burden to establish, by clear and convincing evidence, that a lawful order of the court expressing a clcar and unequivocal mandate was in cff ect, and that the order was disobeycd to a reasonable degrec of certainty. Matter of Departmcnt of Environmental Protection of City 4 [* 6] 0fN.Y. v. Dcpartment of Environmcntal Conservation of State ofN.Y., 70 NY2d 233 (1987); McCormick v Axelrod, 59 NY2d 574, amended 60 NY2d 652 (1 983); Gryphon Domestic VI, LLC v. APP lntcrnational Finance Co, 58 AD3d 498,499 (1 Dept 2009). l he party to be hcld in contempt must be shown to have had knowledge of the order, and the disobediencc must have prejudiced the moving party s rights. See McCain v Dinkins, 84 NY2d 2 1G (1 994); McCormick v Axelrod, supra; Garcia v Grcat Atlantic & Pacific Tea Co, Inc, 23 1 AD2d 401 (1 Dept 1996). Moreover, the penalty imposed for civil contempt is not designed to punish, but rather to compensate the injured party or to coerce compliance with the court s mandate, or both. Matter of Department oi Environmenla1 Protcction of City 0l N.Y. v. Department of Environmental Conscrvation of State ofN.Y., supra at 239. Applying the foregoing standards, the coufl concludes that Transperfect has failed to meet its burdcii so as to warrant holding eithcr dcfendant Collard or non-party Modus in civil contempt. While the stipulation slates that thc Parties and Modus agree that any violation of the terms of this order shall be punishable by contempt, among olhcr remedies availablc lo the Court and the non-breaching party, as the party seeking contempt, Transperfect is still required 10 satisfy the cvidentiary burden necessary to support such relief. Non-party Modus is not subject to the remedy of civil contcrnpt, since the stipulation does not direct Modus to take or rcfrain from taking any particular action. Even though Modus signed the stipulation of settlement, it did so as a non-party and only to the limited extent of exchanging mutual releases of liability with Transl erfeect, Collard alone is bound by the restrictive covenant quotcd above, which enjoined him from soliciting any Transperfect customers for whom hc provided TransPerie ectservices during 5 [* 7] the last year of his employment. Within the contextual framework of the circumstances here, by its terms, the restrictive covenant does not express a clear and unequivocal mandate, since the languagc excluding TransPerfcct clients with whom Collard had preexisting rclationship and who came to TransPerfect solely to avail theniselves of Collard s services, is vague and ambiguous. See e . g Trabanco v. City ofNew York, 81 AD3d 490,492 (1 Dept 201 1) ( order is insufficicnt because it leaves the interpretation of the phrase appropriate material open to debate ); Chung v. Maxam Properties, LLC, 52 AD3d 423 (1 Dept 2008) (injunction that was at bcst ambiguous, was not clear and unequivocal enough to warrant a contempt finding ); Ouick v. ABS Realtv Corp, 13 AD3d 1021 (3rd Dept 2004) (quoting Upper Saranac Lake Assn v. New York State Departmcnl of Environmental Conservation, 263 AD2d 916, 917 [3rd Dept 19991) ( When the ordcr contains ambiguous and vague language, a finding of civil contempt is not tcnable. 1. The conclusion that the stipulation is equivocal in the circumstances at issue is amply demonstrated by the parties varying interpretations of thc exclusionary languagc. TransPerfect asserts that Collard s e-mail to an employee at Covington cannot possibly fall within the exclusion sincc TransPerfcct had a preexisting rclationship with Covington, as evidenced by the submission of more than 800 invoices indicating the work 1ransPerfect performcd for Covington from 2001 through 201 1. Collard, on thc other hand, submits an affidavit identifying three Covington cinployces with whom he claims he had a long-standing and preexisting customer or "business relationship, which From February 2009 to December 201 0 resulted in bringing work to TransPerfcct from Covington. Collard also states that in January and February 201 0, his business relationship with one of those individuals, Jessica Giglio, resulted in 6 [* 8] Transperfect handling an exhibit processing and blowback project for Covington in London, England, which ultimately brought approxiinately $250,000 of revenue to TransPerfect.2 Under these circumstances, where the so-ordcred stipulation leaves the interpretation of the exclusionary language open to debate, the stipulation is ambiguous and vaguc, and as such, fails to express a clear and unequivocal mandatc ibr which the remedy of civil contempt is available. Trabanco v. City of New Yqrk, supra at 492; see also Chunc v. Maxarn Properties, - supra; Quick v. ABS Really Corp, supra. I,LC, The court also concludes that Collard s June 10,2011 ernail to an employee at Covington, does not constitutc clear and convincing evidcnce establishing that Collard violated the so- ordered stipulation with reasonable certainty. @ Matter of Department of Environmental Protection of City of N.Y. v. Depafiment of Environmental Conservation of State yf N.Y ., supra at 239. Moreover, Transperfect has failcd to make a sufiicient showing that it has been prejudiced by the alleged violation. Transperfect provides no factual basis to support its bare and conclusory allegation 01 prejudice. Transperfect seeks attorney s fees and a fine in the niaximurn statutory amount of $250.00, but does not allege that has suffered any conipensable damages, which suggcsts that it has not sustained any actual economic loss as a result of Collard s June 10, 20 1 1 e-mail. See Chainbers v. Old Stone Hill Road Association, supra at 946. Based upon the foregoing, plaintiff has riot established a clear right to an order punishing defendant Collard or non-party Modus for civil contempt, and the motion is denied. -Coronct Capital Co. v Spodek, supra; Usina Costa Pinto, S.A. v. Sanco Sav. Co. Ltd., supra. Sce 2After oral argument and the submission of the motion, defendant Collard submitted an affidavit from Jessica Giglio, to which plaintiff objected. In light of its untimely submission, the court has not considered Ms. Giglio s affidavit in determining the instant motion. 7 [* 9] The cross-motion for sanctions and other relief, is d ~ n i e d .The portion of the cross-motion ~ seeking to vacate or modify the court s February 9,20 1 1 preliminary injunction order, has been rendered moot, since as noted above, the partics Stipulation and Order of Seltlemcnt provided that the Prcliminary 1n.junction Ordcr shall become a permanent injunction that will rcmain binding and in effect through and including 1)ecember 6,201 1 . Accordingly, it is ORDERED that plaintiil s motion for civil contempt is denied; and it is I urther ORDERED that the cross-motion is denied in its entirety DATED: January J<, 2012 ENTER: c /fl i; FILED JAN 26 2012 ~ J.S.C. 3 To the extent Collard apposed this motion on the grounds that Transperfect s counsel should bc disqualificd, that issuc is moot, in view of the court s decision and order dated January 17, 201 2, denying Collard s motion for disqualification (motion seq. no. 005). 8

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.