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Vox Marketing Group, LLC v. Prodigy Promos L.C.

United States District Court, D. Utah, Central Division

March 14, 2019

VOX MARKETING GROUP, LLC, a Utah limited liability company, Plaintiff,
PRODIGY PROMOS L.C., a Utah limited liability company; et al., Defendants.

          District Judge Jill N. Parrish



         District Judge Jill N. Parrish referred this case to Chief Magistrate Judge Paul M. Warner pursuant to 28 U.S.C. § 636(b)(1)(A).[1] Before the court are (1) Defendants Prodigy Promos, L.C.; Jason Marsh; Jon Priday; Tyler Fredrickson; Eric Oldson; Spencer Oldson; and Michael Perley's (collectively, “Defendants”) motion for contempt and sanctions;[2] and (2) Plaintiff Vo x Marketing Group, LLC's (“Plaintiff”) motion for a scheduling conference and entry of a scheduling order.[3] The court has carefully reviewed the written memoranda submitted by the parties on those motions. Pursuant to Civil Rule 7-1(f) of the Rules of Practice for the United States District Court for the District of Utah, the court has concluded that oral argument is not necessary and will decide the motions on the basis of the written memoranda. See DUCivR 7-1(f). The court will address the motions in turn.

         I. Defendants' Motion for Contempt and Sanctions

         This case originated in Utah state court but was later removed to this court.[4] Prior to removal, the state court entered an order on June 13, 2018 (“Order”), which states: “Plaintiff will work with Defendants to allow an independent expert to audit [Plaintiff's] website as it existed in 2016.”[5] Subsequent to the entry of the Order, the parties engaged in negotiations concerning the timing and scope of the audit identified in the Order. On July 19, 2018, the parties and their counsel met at Plaintiff's facility to conduct the audit. While the parties have very different interpretations of what happened that day, it is clear that the audit was not completed.

         On July 26, 2018, Defendants filed in state court their motion for contempt and sanctions.[6] In that motion, Defendants argue that Plaintiff should be held in contempt and sanctioned for failure to comply with the Order.[7] Plaintiff responded to Defendants' motion in state court on August 9, 2018.[8] This case was then removed to this court on August 10, 2018.[9]Defendants filed their reply in support of their motion in this court on August 16, 2018.[10]

         Given that procedural history, and after considering the briefing on Defendants' motion, the court ordered the parties to provide additional briefing on the issue of whether Utah law or federal law applies to Defendants' motion.[11] The parties have completed that briefing, [12] and the court is now prepared to rule on Defendants' motion.

         The court first addresses the law applicable to Defendants' motion. The court concludes that it need not decide whether Utah law or federal law is applicable in this instance because, under either legal standard, Defendants' motion fails.

         Under Utah law, “[a]s a general rule, in order to prove contempt for failure to comply with a court order it must be shown that the person cited for contempt knew what was required, had the ability to comply, and intentionally failed or refused to do so.” Von Hake v. Thomas, 759 P.2d 1162, 1172 (Utah 1988). Under federal law, “[t]o prevail in a civil contempt proceeding, the plaintiff has the burden of proving, by clear and convincing evidence, that a valid court order existed, that the defendant had knowledge of the order, and that the defendant disobeyed the order.” Reliance Ins. Co. v. Mast Const. Co., 159 F.3d 1311, 1315 (10th Cir. 1998) (citation omitted). Under either of those standards, Defendants must establish that Plaintiff refused to comply with a court order. For the following reasons, the court concludes that Defendants have failed to make that showing.

         In their motion, Defendants claim that Plaintiff was required to provide seven specific items in order for Defendants to complete an audit of Plaintiff's website.[13] Importantly, not one of those requirements is listed in the Order. In the court's view, had Defendants wished to require compliance with the terms they unilaterally imposed upon Plaintiff for the audit, Defendants should have ensured that those terms were included in the Or d e r. As noted above, the Order simply stated: “Plaintiff will work with Defendants to allow an independent expert to audit [Plaintiff's] website as it existed in 2016.”[14] The court concludes that Plaintiff did “work with Defendants” in an effort to allow an audit of Plaintiff's website to take place.[15] While Defendants take issue with the fact that those efforts did not lead to a successful audit, the Order did not explicitly require a successful audit. In short, given the vague and general nature of the Order, the court cannot say that Plaintiff failed to comply with its terms. Accordingly, Defendants request for an order of contempt is denied.

         As part of their motion, Defendants also request the imposition of sanctions against Plaintiff. Because the court has concluded that Plaintiff did not violate the Order, it logically follows that the court will not impose sanctions against Plaintiff. The court's conclusion on that issue would be the same under either Utah law or federal law. See Fed. R. Civ. P. 37(b) (allowing for sanctions only when a party fails to obey a court order); Utah R. Civ. P. 37(b) (same). Accordingly, Defendants' request for sanctions is denied.

         As a final matter, the court addresses Plaintiff's request for an award of attorney fees incurred in connection with Defendants' motion. Importantly, Plaintiff has not pointed to any specific authority that would permit the court to award such fees. Even putting that aside, the court concludes that an award of attorney fees to Plaintiff is not appropriate under the circumstances.

         II. Plaintiff's Motion for Scheduling Conference and Entry of Scheduling Order

         On August 20, 2018, the parties filed a joint motion for a scheduling conference.[16] On October 19, 2018, the court entered an order denying that motion.[17] In that order, the court concluded that, generally, proposed deadlines and other scheduling matters are best left to the agreement of the parties. The court further noted that if the parties could reach an agreement on all scheduling matters, it would conserve resources for both the parties and the court, consistent with Rule 1 of the Federal Rules of Civil Procedure. Accordingly, the court ordered the parties to attempt to stipulate to a proposed ...

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