Petition for Writ of Certiorari — Chaganti & Associates, PC v. In re (No. 06-1208)

O6120e HL 62 2007

No. OFFICE OF THE CLERK

wie

In The

Supreme Court of the United States

CHAGANTI & ASSOCIATES. P.C..

Petitioner

On Petition for a Writ of Mandamus and/or in

the alternative Prohibition to the United States

District Court for the Eastern District of

Missouri

NAREN CHAGANTI

(Counsel of Record)

Law Offices of Naren Chaganti

713 The Hamptons Lane.

Fown & Country. MO 63017

narena chaganticom bE-mail

(650) 248-701 |

Counsel for Petitioner

i

QUESTIONS PRESENTED

Whether this Court should issue a Writ of Mandamus

and/or Prohibition to a District Court, which held that it

was contempt of court if a party appeals a District Court’s

vague, uncertain and indefinite order, compliance with

which order was not only impossible because of vagueness

but also would have rendered the pending appeal moot?

CORPORATE DISCLOSURE STATEMENT

Petitioner Chaganti & Associates, P.C. is a Missouri

corporation with principal place of business in Missouri. It

has no parent and no publicly held entity owns 10% of its

corporate stock.

ill

TABLE OF CONTENTS

QUESTIONS PRESENTED

CORPORATE DISCLOSURE STATEMENT

TABLE OF CONTENTS

PETITION FOR A WRIT OF MANDAMUS AND/OR IN

THE ALTERNATIVE PROHIBITION

OPINIONS BELOW

JURISDICTION

CONSTITUTIONAL AND STATUTORY AND

PROVISIONS INVOLVED

I, THE WRIT OF MANDAMUS IS AVAILABLE TO

ADDRESS JUDICIAL USURPATIONS OF POWER,

TRANSGRESSIONS OF AUTHORITY BY LOWER COURTS AND

TO PROTECT CONSTITUTIONAL RIGHTS OF LITIGANTS. ....... 7

I]. THE DISTRICT COURT’S CONTEMPT ORDER USURPS

THE HIGHER COURT’S APPELLATE AUTHORITY BY FORCING

AN APPEALING PARTY TO TAKE ACTIONS THAT WOULD

RENDER THE PENDING APPEAL MOOT

If. THE DISTRICT COURT DID NOT GIVE PETITIONER

DUE PROCESS PROTECTIONS BEFORE FINDING IT IN

CONTEMPT, IGNORED LEGITIMATE REASONS FOR

NONCOMPLIANCE AND ENTERED AN UNNECESSARY

CONTEMPT ORDER

TABLE OF AUTHORITIES

Cases

Akin v. Ashland Chem. Co., 156 F.3d 1€30 (10th Cir. 1998)

Beacon Theaters, Inc. v. Westover, 359 U.S. 500 (1959)

Brunton v. Superior Court, 20 Cal. 2d 202 (1942)

Cantrell v. Great Republic Ins. Co., 873 F.2d 1249 (9th Cir.

Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541 (1949).....9

De Beers Consol. Mines v. United States, 325 U.S. 212 (1945) 5,

8

Delaware, Lackawanna & Western RR Co. v. Rellstab, 276 U.S.

1 (1928)

Dunn vy. United States, 442 U.S. 100 (1979)

Ex parte Fisk, 113 U.S. 713 (1884)

Ex parte Republic of Peru, 318 U.S. 578 (1943)

Garfield v. United States ex rel. Goldsby, 211 U.S. 249 (1908) .4

General Atomic Co. v. Felter, 436 U.S. 493 (1978)

Griggs v. Provident Consumer Discount Co., 459 U.S. 56 (1982)

In Re Brand Name Prescription Drugs Antitrust Litig., 123 F.3d

599 (7th Cir. 1997)

In re Grand Jury Subpoenas Duces Tecum, 78 F.3d 1307 (8th

Cir. 1996)

International Union, United Mine Workers of America v.

Bagwell, 512 U.S. 821 (1994)

Marbury v. Madison, 1 Cranch 137 (1803)

Marrese v. Am. Academy of Orth. Surgeons, 470 U.S. 373

(1985)

Maryland v. Soper, 270 U.S. 9 (1926)

McCargo v. Chapman, 61 U.S. 555 (1858)

Memphis Light, Gas & Water Div. v. Croft, 46 U.S. 1 (1979).. 12

Mills v. Green, 159 U.S. 651 (1895)

Roche v. Evaporated Milk Assn., 319 U.S. 21 (1943)

Schlaegenhof v. Holder, 379 U.S. 104 (1964)

Thermtron Prods, Inc. v. Hermansdorfer, 423 U.S. 336 (1975) .2

United States Catholic Conf. v. Abortion Rights Mobilization,

Inc., 487 U.S. 72 (1988)

nited States v. Ryland, 450 U.S. 752 (1983)

Will v. United States, 389 U.S. 90 (i967)

Statutes

28 U.S.C. § 1651(a)

Rules

Fed. R. App. P. 21(a)

PETITION FOR A WRIT OF MANDAMUS AND/OR

IN THE ALTERNATIVE PROHIBITION

Petitioner, Chaganti & Associates, P.C., hereby

respectfully petitions that a Writ of Mandamus and/or in

the alternative Prohibition be issued directing the District

Court, Hon. District Judge Henry E. Autrey to vacate-the

order dated April 14, 2005 in the case Chaganti &

Associates, P.C., v. Nowtony, Case No. 03-CV-501 HEA,

in which order the District Court held Plaintiff in contempt

of court for not executing unspecified documents, which

were vague as to their contents, and which if executed,

would have rendered a pending appeal moot.

OPINIONS BELOW

The opinion of the Court of Appeals for the Eighth

Circuit (App., infra, la-14a) is reported at 470 F.3d 1215.

The orders of the District Court for the Eastern District of

Missouri (App., infra, 18a-21a) are unreported.

JURISDICTION

This Court has jurisdiction to correct the District

Court’s decision to hold Petitioner in contempt of court. 28

U.S.C. §§ 1651(a) and 2106. The District Court’s order of

contempt was dated April 14, 2005, (App., infra, at 19a-

21a), and the Eighth Circuit Court of Appeals’ denial of the

Petition for a Writ of Mandate is dated December 5, 2006.

(App., at la-14a). A timely filed petition for rehearing was

denied on January 16, 2007. App., at 15a.

CONSTITUTIONAL AND STATUTORY AND

PROVISIONS INVOLVED

The Fifth Amendment to the US Constitution provides,

in relevant part, “No person shall * * * be deprived of life,

liberty or property, without due process of law * * *.”

* * *

The All-Writs Act states, in pertinent part: “[AJIl courts

* * * may issue all writs necessary or appropriate in aid of

their respective jurisdictions * * *.” 28 U.S.C. § 1651(a).

2

GROUNDS IN FAVOR OF A WRIT

Petitioner respectfully requests this Court to issue a

Writ of Mandamus directing the U.S. District Court for the

Eastern District of Missouri, Honorable District Judge

Henry E. Autrey, (hereafter “District Court”) to vacate its

ruling of April 14, 2005, see App., infra, at 19a-2la,

because the district court lacked jurisdiction over a matter

on which an appeal was pending, because the practical

effect of the court’s contempt order is to punish a party for

appealing its decision, because the District Court imposed

contempt sanctions without proper notice, opportunity for

discovery or a jury trial, because the District Court did not

countenance appellant’s valid reasons for noncompliance

with its order, and because the District Court’s action is an

unlawful usurpation of power by a lower court.

This Court has authority to issue a writ of mandamus to

reverse the lower courts’ erroneous contempt order under

the All Writs Act, 28 U.S.C. § 1651(a). Schlaegenhof v.

Holder, 379 U.S. 104, 11-12 (1964). “A traditional use of

the writ in aid of appellate jurisdiction both at common law

and in the federal courts has been to confine an inferior

court to a lawful exercise of its prescribed jurisdiction or to

compel it to exercise it authority when it is its duty to do

so.” Thermtron Prods, Inc. v. Hermansdorfer, 423 U.S.

336, 352 (1975). “Repeated decisions of [the Supreme

Court] have established the rule * * * that the writ will lie

in a proper case to direct a subordinate Federal court to

decide a pending cause, * * * or to require a Federal court

of inferior jurisdiction to reinstate a case, and to proceed to

try and adjudicate the same.” /d., at 352.

As demonstrated below, this Court should exercise its

authority to correct, by a writ of mandamus, the lower

courts’ clearly erroneous finding of contempt in effect for

appealing its vague, indefinite, and uncertain order too

execute unspecified “documents” to effectuate settlement.

A writ of mandate is appropriate to correct the District

Court’s unlawful finding of contempt. The contempt

finding and the impending contempt hearing are unlawful

because they were designed to coerce a party to forego its

right to appeal by taking actions that render the party’s

appeal moot. Such coercion allows an inferior tribunal to

usurp the higher court’s power by preventing a review of

the lower court’s ruling. This was the reason jurisdiction

transfers to the higher court once a notice of appeal is filed.

In this case, after holding a hearing on defendants’ motions

for contempt, the District Court further erred when it

refused to accord due process protections to Petitioner.

Petitioner filed for a petition for a writ of mandate and

for stay with the court of appeals for the Eighth Circuit.

Petitioner also filed a direct appeal from the final decision

of the District Court whereby the District Court held that

the parties had settled the case.

The Court of Appeals for the Eighth Circuit affirmed

the District Court’s power to hold Petitioner in contempt,

and held that a party could be held in contempt of violating

a vague order. App., at la-14a. The Eighth Circuit vacated

the contempt holding on the grounds that the District Court

did not clarify whether the contempt finding was to

vindicate its authority or as a remedial measure to

compensate the defendants. /d., at 14a. It ruled, “On

remand, therefore, if C&A does not promptly comply with

the court's order to effectuate the settlement, the court

should specify whether the monetary sanctions are

compensatory or coercive in nature, and explain the basis

for whatever amount is ordered.” Jd. (emphasis added).

Petitioner sought rehearing and rehearing en banc

which were denied without discussion. App., at 15a.

Before the period for filing the Petition for a Writ of

Certiorari with the Supreme Court is expired, defendants

4

have filed a yet another motion for contempt with the

District Court, and the District Court has scheduled a

hearing on this matter on March 8, 2007.

In light of the present threat of contempt once again

before the right to file a petition for certiorari with this

Court is exercised, Petitioner is placed in a situation similar

to that it faced when the matter was before the court of

appeals. Then the court of appeals stayed the contempt

order pending its ruling on the merits of the appeal.

Because there is no other adequate or available remedy,

Petitioner respectfully requests that a Writ of Mandate

issue in this matter. Cf Garfield v. United States ex rel.

Goldsby, 211 U.S. 249, 261-262 (1908) (where there is an

actual or threatened personal injury by action “ultra vires,

and beyond the scope of * * * authority,” mandamus will

issue to “restore the status of the parties”).

STATEMENT OF PERTINENT FACTS

In the underlying litigation, Chaganti & Associates,

P.C., sued defendants Dr. Nowotny and Dr. Vardeleon for

tortious interference with its business relations with St.

Anthony’s Medical Center (“the hospital”) and for

“unlawful restraint of trade.” (App., at 2a). Forty five days

after they were served, defendants claimed that they “for

the first time” realized that the claim “unlawful restraint of

trade” raised a federal question and removed the case to the

federal court. Petitioner timely moved the district court to

remand the case, which denied the motion!. Jd.

' One of the issues to be raised on certiorari is whether the

District Court had subject matter jurisdiction in view that the

defendants removed the case untimely. The Eighth Circuit ruled

that this case was not about “artful pleading” and conflicted with

other courts of appeals. See Jn Re Brand Name Prescription

Drugs Antitrust Litig., 123 F.3d 599 (7th Cir. 1997)(state court

(Continued on following page)

Roughly one and half years later, in September 2004,

Mr. Winthrop Reed, counsel for defendants, claimed that

the parties had reached a settlement and moved to enforce

the settlement. Reed gave a declaration stating that the

parties had settled under the terms laid out by the nonparty

hospital. Petitioner disagreed that there was “settlement”

and stated that they were merely discussions between

attorneys. (App., at 2a). On December 1, 2004, without

any evidentiary hearing that Petitioner requested, the

District Court affirmed the defendants’ version of facts and

ordered Petitioner to execute unspecified “documents”

necessary to effectuate settlement within ten days or face

sanctions. (App., at 18a). On December 9, 2004,

Petitioner filed a notice of appeal from that order. On

December 9, 2004, Petitioner also filed a “Motion to Stay

antitrust case was held removable because the substantive

provisions of the state antitrust laws were similar to that of the

federal antitrust statutes.); Cantrell v. Great Republic Ins. Co.,

873 F.2d 1249 (9th Cir. 1989)(inartfully pled complaint provided

sufficient notice for removal); Akin v. Ashland Chem. Co., 156

F.3d 103v, 1035 n.2 (10th Cir. 1998) (stating that defendant has

a duty to investigate potential reasons for removal within the first

thirty days of receiving a complaint). If there is no federal

subject matter jurisdiction in light of the improper removal, it

disposes the entire case because the District Court would be

“without jurisdiction” of a primary act and thus it was “without

authority” of a subsequent act premised thereupon, and

mandamus will issue to reverse both acts. De Beers Consol.

Mines v. United States, 325 U.S. 212, 222-223 (1945). Cf.

United States Catholic Conf. v. Abortion Rights Mobilization,

Inc., 487 U.S. 72, 76-77 (1988) (Where “district court does not

have subject- matter jurisdiction over the underlying action * * *

-process” issued thereupon “is void and an order [punishing]”

thereupon “rust be reversed”); Ex parte Fisk, 113 U.S. 713, 718

(1884) (an “order” issued by court “without jurisdiction, is void,

and the order punishing [thereupon] is equally void’’).

6

Order Dated December 1, 2004 Pending Appeal,” which

the trial court denied.

On December 14, 2004, Defendants filed a first Motion

for Contempt and/or for Sanctions alleging that Petitioner’s

refusal to sign the documents was in contempt of the

court’s order. Petitioner responded that it could not comply

with the order because executing the documents would

render the appeal moot. On March 1, 2004, the court of

appeals allowed the appeal to proceed. App., infra, at 18a.

On or about March 10, 2005, the defendants filed a

paper entitled “Second Motion for Contempt and for

Sanctions,” arguing that an EEOC charge by Dr. Chaganti

against the hospital was in contempt of the District Court’s

order. On April 4, 2005, Petitioner subpoenaed nonparty

hospital to collect evidence related to this second motion

for contempt in light of the subsequent discovery that the

hospital had repudiated any settlement”.

On April 11, 2005, the District Court held a hearing and

quashed the subpoenas Petitioner issued. On April 14,

2005, without the benefit of an evidentiary hearing or jury

trial, the District Court entered an order that Petitioner was

in contempt pursuant to its December 1, 2004 order and

imposed a fine of $500 per day “from the date of this

order”. On the. following day, April 15, 2005, the District

Court served the order on Petitioner, App., at 19a-21a.

? One of the bases of defendants’ motion for contempt was

that Dr. Chaganti did not “resign.” But there was nothing to

resign from, because on March 29, 2005, the hospital notified

Petitioner that it removed Dr. Chaganti from its staff. This made

any alleged settlement voidable for repudiation or impossibility.

The court of appeals ignored did not take note of all key facts.

7

Petitioner filed a writ of mandate and for stay with the

Court of Appeals for the Eighth Circuit, pursuant to which

the Court of Appeals stayed the order of contempt. App., at

16a. After consolidating the petition for writ with the

appeal on substantive matters, the court of appeals affirmed

the District Court’s power to hold a party in contempt

while an appeal was pending, but vacated the monetary

sanction and remanded the matter to the District Court to

determine whether the contempt finding was coercive or

remedial in nature. App., at la-14a.

Before Petitioner has had an opportunity to file for a

Writ of Certiorari with this Court, the District Court once

again announced that it would hold a hearing on the issue

of contempt on March 8, 2007. This Petition follows.

ARGUMENT

I. THE WRIT OF MANDAMUS IS AVAILABLE TO

ADDRESS JUDICIAL USURPATIONS OF POWER,

TRANSGRESSIONS OF AUTHORITY BY LOWER

COURTS AND TO PROTECT CONSTITUTIONAL

RIGHTS OF LITIGANTS.,

Under the All Writs Act, 28 U.S.C. § 1651(a), this

Court has the power to issue a writ of mandamus either in

the exercise of its appellate jurisdiction or if it is necessary

to enable the Court to exercise its appellate jurisdiction.

Fed. R. App. P. 21(a); Marbury v. Madison, 1 Cranch 137,

175 (1803). It is settled that a writ of mandamus is

properly granted to (a) protect the superior court’s mandate,

see General Atomic Co. v. Felter, 436 U.S. 493, 497

(1978), or (b) restrain an inferior court from detours into

areas in which it lacks jurisdiction (or, in some instances,

forcing an inferior court to take an obligatory action), see

Ex parte Republic of Peru, 318 U.S. 578, 583 (1943).

The wnt of mandamus has been traditionally issued

to confine an inferior court to a lawful exercise of its

+66

8

prescribed jurisdiction or to compel it to/ exercise its

authority when it is its duty to do so.’” Will v. United

States, 389 U.S. 90, 94 (1967). Mandamus is proper in

cases involving “judicial usurpatio..s of power” by inferior

courts. /d., at 95(citation and quotes omitted). “[W]hen a

court has no judicial power to do what it purports to do —-

when its action is not mere error but usurpation of power —

the situation falls precisely within” the perimeters of

mandamus and the “inquir{y]” turns upon “whether the

District Court is empowered to enter the order under

attack.” De Beers Consol. Mines v. United States, 325 U.S.

212, 217 (1945); Delaware, Lackawanna & Western RR

Co. v. Rellstab, 276 U.S. 1, 5 (1928) (to reverse an

“unwarranted attempt” by a district court “to set aside a

judgment it had no jurisdiction to touch”); McCargo v.

Chapman, 61 U.S. 555, 557 (1858) (to compel a lower

court to “set * * * aside or quash” an “execution * * *

issued” but “not authorized” when such court refuses to do

so by motion).

Mandamus is also available where a district court

denies clearly established constitutional rights to a litigant.

A right to appeal is sacrosanct among the constitutional

rights of a litigant under the Due Process Clause. Cf

Beacon Theaters, Inc. v. Westover, 359 U.S. 500, 511

(1959) (“There can be no doubt that a litigant is entitled to

a writ of mandamus to protect a clear constitutional right”

to jury trial).

In this extraordinary ruling, though the District Court

couched the order as forcing compliance with its prior

order that it did not stay, the result of the order holding

Petitioner in contempt is to punish the Petitioner for

appealing its decision, which action clearly exceeds the

District Court’s authority and jurisdiction. See Roche v.

Evaporated Milk Assn., 319 U.S. 21, 26 (1943). A lower

court should not be able to prevent a review of its decision.

9

Due to the coercive nature of the District Court’s holding,

appellate review of the challenge order will be defeated if a

writ does not issue. See Maryland v. Soper, 270 USS. 9,

29-30 (1926). There is no compelling logic to support

usurpation of appellate authority by a lower court.

It. THE DISTRICT COURT’S CONTEMPT ORDER

USURPS THE HIGHER COURT’S APPELLATE

AUTHORITY BY FORCING AN APPEALING PARTY TO

TAKE ACTIONS THAT WOULD RENDER THE

PENDING APPEAL MOOT

A. The District Court lacked jurisdiction to

interfere with a matter that was on appeal.

In this case, the District Court never entered a “final”

order. Instead, it entered an interlocutory order that the

parties had settled, retained jurisdiction to enforce

settlement and to impose sanctions if Petitioner did not

comply. App., at 18a. Petitioner filed a timely notice of

appeal from that order. When the Eighth Circuit asked

Petitioner to justify appellate jurisdiction from a non-final

order, Petitioner relied on Cohen v. Beneficial Indus. Loan

Corp., 337 U.S. 541, 546-47 (1949) and argued that the

case fell under the statutory or judicially created exception

to the finality doctrine because of the nature of the District

Court’s order, which required the parties to file a dismissal

of the case, would be effectively unreviewable on appeal.

The Eighth Circuit allowed the appeal. App., at 17a.

Once a higher court accepted jurisdiction over the order

and the appeal, it was an error for the District Court to

continue to exercise jurisdiction over the same issue and

take actions that would interfere with a higher tribunal’s

authority. See Marrese v. Am. Academy of Orth. Surgeons,

470 U.S. 373, 378-79 (1985). “The filing of a notice of

appeal is an event of jurisdictional significance—it confers

jurisdiction on the court of appeals and divests the District

Court of its control over those aspects of the case involved

10

in the appeal.” Griggs v. Provident Consumer Discount

Co., 459 U.S. 56, 58 (1982).

Contrarily to this settled rule that a notice of appeal

transfers jurisdiction over the appealed matters to the

higher tribunal, the District Court held that the Petitioner

was in contempt because Petitioner did not comply with the

order that was on appeal and sign the documents. Not only

was there no jurisdiction retained in the District Court as to

the issues on appeal, but also Due Process cannot permit

such complex situations.

B. The District Court exceeded its authority

when it attempted to coerce compliance

with its order aimed at rendering the

pending appeal moot.

Moreover, compliance with the District Court’s order,

if clear and unequivocal, would have rendered the pending

appeal moot. See, e.g., Jn re Grand Jury Subpoenas Duces

Tecum, 78 F.3d 1307 (8th Cir. 1996)(The “existence of a

live case or controversy is a constitutional prerequisite to

the jurisdiction of the federal courts.”) “Consequently,

federal courts have no authority to render decisions upon

moot questions.” Jd. (citing Church of Scientology of Cal.

v. United States, 506 U.S. 9, 12 (1992)). “{I]}f during the

pendency of an appeal, an event occurs which destroys the

court’s ability to render the prevailing party “‘any effectual

relief whatever,’” the appeal will be dismissed as moot. /d.

(quoting Mills v. Green, 159 U.S. 651, 653 (1895)).

Accordingly, complying with the District Court’s order

would have meant that Petitioner consented to the alleged

“settlement” agreement according to the terms of the

defendants’, rendering the appeal moot.

> Separately, that alleged “settlement” fails for want of

consideration and is also voidable as being a product of unlawful

threats of extortion.

1]

The finding of contempt therefore violates the litigant’s

right to appeal, the higher tribunal’s supervisory authority,

the Due Process Clause, and the doctrine of open access to

courts. No party should face the impossible choice of

contempt sanctions on the one hand and loss of right to

appeal on the other.

C. Compliance with the District Court’s order

was impossible because it was vague and

uncertain as to the documents to be signed.

The District Court’s order of contempt was based on

the alleged refusal of the Petitioner to sign unspecified

“documents.” But the District Court did not specify which

documents were to be signed or what terms bound the

parties in settlement. Petitioner argued that one should not

be held in contempt of violating an uncertain order.

The Eighth Circuit, while acknowledging that the

District Court’s order was indefinite and uncertain as to

terms of settlement and the documents to be executed, held

that the District Court had the power to hold a party in

contempt for violating an order that was on appeal. App.,

at 13a. As to uncertainty of the order, the Eighth Circuit

stated that the onus was on the Petitioner to find out what

the District Court ordered by filing a motion for

clarification. /d., at n.2 (“If the court’s order was vague,

then C&A should have requested additional guidance from

the court. By failing to do anything, C&A violated the

order.”’)

According to the Eighth Circuit, therefore, one could be

held in contempt of a District Court’s order that was

unclear, uncertain, indefinite or vague. This is wrong

because it violates the rule of lenity. See Dunn v. United

States, 442 U.S. 100, 112 (1979)(stating that the rule of

lenity furthers the constitutional due-process principle “that

12

no individual be forced to speculate, at peril of indictment,

whether his conduct is prohibited.”) Accord, Brunton v.

Superior Court, 20 Cal. 2d 202, 205 (1942)(“The party

bound by an injunction must be able to determine from its

terms what he may and may not do; he cannot be held

guilty of contempt for viclating an injunction that is

uncertain or ambiguous, just as he may not be held guilty

of violating a criminal statute that fails to give him

adequate notice of the prohibited act.”) (citations omitted).

Contrary to the settled law that vague language cannot

support a contempt finding, the Eighth Circuit stood the

concept of void for vagueness on its head. Mandamus is

the only remedy to correct this extraordinary expansion of

the law of contempt.

Il. THE DISTRICT COURT DID NOT GIVE PETITIONER

DUE PROCESS PROTECTIONS BEFORE FINDING IT IN

CONTEMPT, IGNORED LEGITIMATE REASONS FOR

NONCOMPLIANCE AND ENTERED AN UNNECESSARY

CONTEMPT ORDER.

A. The District Court’s finding of contempt

violated the Due Process Clause.

Due Process requires that the court place a party on

notice of the nature of sanction before depriving the party

of property right, which is the result of the instant contempt

finding. Memphis Light, Gas & Water Div. v. Croft, 46

U.S. 1, 16 & 20 (1979). Due Process also requires a

meaningful opportunity to prepare for a hearing. Jd., at 14.

On December 1, 2004, the District Court stated that

Plaintiff would be subject to “sanctions” if it did not

execute the documents settling the case, but did not

specifically state the nature of the sanctions or that it would

hold Petitioner in contempt and thereafter impose monetary

sanction as well. As argued above, nor was there any

transparency as to what “documents” were to be executed.

Because the District Court did not apprise Petitioner of the

13

nature of sanction it would impose, the contempt finding

violated the Due Process Clause.

On April 4, 2005, Petitioner subpoenaed two nonparties

including the hospital*, which possessed information

contradicting the defendants’ assertions in the motion for

contempt. On defendants’ request, the district judge

quashed the subpoenas at the April 11, 2005 hearing and

thus prevented Petitioner from establishing information

relating to the contempt motion. Because the District Court

did not permit Petitioner to establish facts supporting

Petitioner’s argument, the finding of contempt violated the

Due Process Clause.

B. The District Court ignored Plaintiff’s

legitimate reasons for noncompliance.

If it was a civil contempt, a party against whom a

proceeding is initiated may assert “a present inability to

comply with the order in question.” United States v.

Ryland, 450 U.S. 752, 757 (1983) (citations omitted). A

court “cannot be blind to evidence that compliance with an

order was factually impossible” as it is the case here

because the matter was on appeal and compliance would

render the appeal moot. See id. “Where compliance is

impossible, neither the moving party nor the court has any

reason to proceed with the civil contempt action.” Jd.

Because Plaintiff has met its burden of showing that the

matter was on appeal and compliance would be impossible

in view of the pendency of the appeal, there is no contempt

of the District Court’s order, which lost jurisdiction.

Peculiarly, the District Court acknowledged in its ruling

that the matter was pending with the court of appeals and

* Though these nonparties did not have any standing with the

district court, the district judge nevertheless entertained their

motion for contempt and sanctions.

14

still ruled that it could enforce the matter, which in effect

undercuts the higher court’s authority.

C. Because there was no opportunity to purge

any contempt, the sanction was criminal in

nature, which required a jury trial.

Here, the district judge entered the contempt order on

April 14, 2005 requiring that Petitioner pay $500 per day

“from the date of the order” but served the order on

Petitioner on April 15, 2005. Therefore, by the time

Plaintiff learned of the order, there was no opportunity,

even theoretically, to purge the contempt, which makes it a

criminal contempt. In civil contempt, “the contemnor is

able to purge the contempt and obtain his release by

committing an affirmative act, and thus carries the keys of

his prison in his own pocket,” see /nternational Union,

United Mine Workers of America v. Bagwell, 512 U.S. 821,

828 (1994), and “a completed act of disobedience that the

contemnor cannot avoid” is criminal in nature. Jd. And in

the case of criminal contempt, the District Court is required

to find contempt “beyond a reasonable doubt” pursuant to a

jury trial. /d., (requiring jury trials in criminal contempt

citations. Here, the District Court did not hold a jury trial,

nor did it find contempt “beyond a reasonable doubt.”

D. The threat of contempt was unnecessary

because the issues on appeal would have

determined the validity of any settlement

Under these circumstances, a contempt proceeding not

only interferes with the higher tribunal’s authority, but also

is totally unnecessary becavse the correctness of the

District Court’s order would4 be determined on appeal.

There was no reason to invoke potent contempt powers to

achieve that which would harpen naturally in due course.

15

IV. CONCLUSION

For the foregoing reasons, Petitioner respectfully

requests a writ of mandamus directing District Judge Henry

E. Autrey to vacate his order of contempt against

Petitioner, and grant such other and further relief as is

proper and just.

Respectfully submitted,

S/Naren Chaganti

NAREN CHAGANTI

(Counsel of Record)

Law Offices of Naren Chaganti

432 S. Curson Avenue, !2 H

Los Angeles, CA 90036

naren@chaganti.com E-mail

(650) 248-7011

Counsel for Petitioner

la

APPENDIX

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

Nos. 05-1101/05-2075

Chaganti & Associates, P.C.,

Appellant,

v.

Thomas Nowotny; Roger V. Vardeleon,

Appellees.

Appeals from the United States

District Court for the

Eastern District of Missouri

No. 05-2065

In re: Chaganti & Associates, P.C.,

Petitioner,

Petition for Writ of Mandamus

Submitted: September 29, 2006

Filed: December 5, 2006

Before RILEY and COLLOTON, Circuit Judges, and

KYLE’, District Judge.

COLLOTON, Circuit Judge.

' The Honorable Richard H. Kyle, United States District

Judge for the District of Minnesota, sitting by designation.

2a

Chaganti & Associates, P.C., (“C&A”), brought an

- action in Missouri state court alleging that the defendants,

Thomas Nowotny and Roger Vardeleon, interfered with the

corporation’s economic advantage, conspired to injure its

business, and restrained trade. Nowotny and Vardeleon

removed the case to the United States District Court for the

Eastern District of Missouri, and the district court denied

C&A’s motion for remand.

Roughly a year and a half later, the district court found

that all parties had agreed to settle the case, and granted the

defendants’ motion to enforce settlement.

After C&A’s principal, Dr. Suren Chaganti, refused to

sign the settlement documents, the court held C&A in

contempt of court. C&A appeals the district court’s denial

of remand, the grant of the defendants’ motion to enforce

settlement, and several other rulings. C&A also petitions

for a writ of mandamus to vacate the court’s contempt and

sanctions order. A panel of this court consolidated these

matters and granted a stay pending appeal of the district

court’s contempt and sanctions order. We now deny the

petition for writ of mandamus and affirm all of the district

court’s orders, except for the order imposing sanctions for

contempt of court.

I.

Chaganti and Associates, P.C., is a corporation owned

entirely by Suren Chaganti (“Dr. Chaganti”), a psychiatrist.

Dr. Chaganti maintained staff privileges at the St.

Anthony’s Medical Center in St. Louis, Missouri. While

Dr. Chaganti was at St. Anthony’s, the medical center's

Behavioral Health Care Review Committee began an

inquiry into his practice. Thomas Nowotny was chair of the

Review Committee. Based on the results of the

committee’s inquiry, Roger Vardeleon, then president of

the St. Anthony’s medical staff, sent Dr. Chaganti a letter

in March 2002. The letter stated that Dr. Chaganti’s staff

privileges could be revoked if he did not fulfill certain

3a

certification and educational requirements. Dr. Chaganti

did not fulfill these requirements, and in June 2003, the St.

Anthony’s Medical Executive Committee recommended

that the medical center terminate Dr. Chaganti’s staff

privileges.

On February 20, 2003, several months before the

Medical Executive Committee recommended that Dr.

Chaganti’s privileges be terminated, C&A filed a petition

in St. Louis City Circuit Court alleging that Nowotny and

Vardeleon had interfered with C&A’s economic advantage,

conspired to injure its business, and restrained trade. The

petition did not indicate the state or federal laws on which

the claims were based.

On March 28, 2003, Nowotny and Vardeleon filed a

motion to transfer the case within the Missouri court

system to St. Louis County. In C&A’s response to this

motion, filed on April 4, C&A alleged for the first time that

Nowotny and Vardeleon had “violated antitrust laws of the

United States.” Based on this allegation, Nowotny and

Vardeleon filed a notice of removal in the United States

District Court for the Eastern District of Missouri on April

18, 2003. C&A then moved to remand the case to state

court on the ground that removal was untimely, but the

district court denied the motion.

After the case was removed to federal court, Winthrop

Reed, an attorney for Nowotny and Vardeleon, began to

discuss the possibility of settlement with C&A’s attorney,

Naren Chaganti (“Naren”). According to Reed’s swom

declaration, on August 25, 2004, he and Naren entered into

a settlement agreement on behalf of C&A, Nowtony,

Vardeleon, and St. Anthony’s Medical Center. According

to Reed, the agreement had the following terms: Dr.

Chaganti agreed to complete specified educational

requirements, dismiss this case and another he had filed in

State court, sign a mutual release, and execute a letter

withdrawing his application for reappointment to the

4a

medical staff at St. Anthony’s. After all parties executed

the mutual release, the executed documents would be held

in escrow. The Medical Executive Committee then would

be notified that the matter was settled and would conclude

its investigation of Dr. Chaganti. Provided that the

Committee closed its investigation and determined that it

was not required to report Dr. Chaganti to the National

Practitioners Data Bank, the executed documents would be

released from escrow.

On August 27, 2004, the parties filed a joint motion

with the district court requesting an extension of time on all

dates. The motion advised the court that the parties had

reached an “agreement in principle,” and requested

additional time to conclude settlement arrangements. In

September 2004, Reed drafted the documents called for by

the alleged agreement and gave them to Naren for review.

According to Reed’s declaration, Naren approved these

documents and said that Dr. Chaganti would sign them.

Reed avers that on October !, Naren informed him that Dr.

Chaganti had decided that he would not withdraw his

application for reappointment to St. Anthony’s, and thus

would not sign the settlement documents.

After Dr. Chaganti declined to sign the settlement

documents, Nowotny and Vardeleon filed a motion to

enforce the alleged settlement. Reed attached a sworn

declaration describing the course of _ settlement

negotiations, and he also attached the unsigned settlernent

documents. Chaganti’s response denied that any such

agreement existed. On November 30, 2004, the court held a

hearing on the motion to enforce settlement, during which

the court questioned Reed and Naren about their

negotiations. Naren acknowledged that he had discussed

the possibility of settlement with Reed, but insisted that

they had reachec +0 agreement and that he had no authority

to settle the case. The court also spoke briefly with Dr.

Chaganti by telephone during the hearing. At the close of

Sa

the hearing, the court ruled that Naren did have authority to

enter into a settlement agreement and that he had done so.

Consequently, the court granted Nowotny and Vardeleon’s

motion to enforce settlement and ordered Dr. Chaganti to

“execute the required documents necessary to effectuate the

parties’ settlement of this matter within ten (10) days.”

(J.A. at 336). The court also warned C&A that “[flailure to

comply with this order may result in the imposition of

sanctions.” (/d.),

Dr. Chaganti never signed any of the settlement

documents, and on April 14, 2005, the court granted the

defendants’ motion to hold C&A in contempt, sanctioning

C&A five hundred dollars per day until Dr. Chaganti

signed the settlement documents. On April 15, 2005, C&A

filed a petition for writ of mandamus challenging this

ruling, and on August 23, 2005, we stayed the ruling

pending appeal.

Il.

C&A appeals the district court’s denial of its motion to

remand the case to Missouri state court on the ground that

removal to federal court was improper. We review de novo

the district court’s exercise of removal jurisdiction and

denial of a motion to remand. United States v. Todd, 245

F.3d 691, 693 (8th Cir. 2001).

The federal removal statute provides that a civil

defendant generally must file a notice of removal within

thirty days of receiving the initial pleading setting forth the

claim of relief. 28 U.S.C. § 1446(b). The statute also

provides, however, that if the “case stated by the initial

pleading is not removable, a notice of removal may be filed

within thirty days after receipt by the defendant... of a

copy of an amended pleading, motion, order or other Paper

from which it may first be ascertained that the case is one

which is or has become removable.” /d.

Under the “well-pleaded complaint rule,” a case in

which federal jurisdiction is based on a federal question

6a

ordinarily is not removable unless the “federal question is

presented on the face of the plaintiff's properly pleaded

complaint.” Caterpillar, Inc. v. Williams, 482 U.S. 386,

392 (1987). C&A’s original petition was entitled “Petition

for Interference in Business Advantage; Conspiracy to

Injure a Business; Unlawful Restraint of Trade.” (J.A. at

19-27). It made no reference to any federal statute and did

not advance any claim that was necessarily based on

federal law. The only legal citation in the petition referred

to a business interference case decided by the Missouri

Supreme Court under Missouri law. (/d. at 21, 24). The

most natural reading of the petition was that it contained

claims based on Missouri law. The petition did not include

allegations from which the defendants reasonably should

have ascertained that the case was removable.

C&A first asserted that it was advancing a federal claim

on April 4, 2003, in its response to the defendants’ motion

to transfer. Unlike C&A’s initial complaint, the response

contained an explicit reference to “antitrust laws of the

United States.” At that point, it was clear that the petition

raised a federal claim, and the thirty-day period for removal

commenced at that time.

C&A contends that under the “artful pleading

doctrine,” the case was removable when C&A filed its

petition in February. The artful pleading doctrine, a

corollary to the well-pleaded complaint rule, allows a

defendant to remove a case to federal court when the

plaintiff has attempted to defeat removal by failing to

plead a necessary federal question. Rivet v. Regions Bank of

Louisiana, 522 U.S. 470, 475 (1998). “[C]ourts will not

permit plaintiff to use artful pleading to close off

defendant’s right to a federal forum,” Federated Dep’t

Stores, Inc. v. Moitie, 452 U.S. 394, 397 n2 (1981)

(internal quotation omitted), and the doctrine of artful

pleading is designed to protect the right of defendants to

have federal claims against them tried in federal court.

7a

The artful pleading doctrine has no application in this

case. A federal antitrust claim was not necessary to the

claims alleged in C&A’s petition. Unlike a state-law claim

that is completely preempted by a federal statute such as

ERISA, see Rivet, 522 U.S. at 475, a claim of “unlawful

restraint of trade” may be pleaded under the laws of

Missouri alone. See Mo. Rev. Stat. § 416.031 (2000). Until

C&A’s response to the motion to transfer, the defendants

had no grounds to assert that the petition necessarily

involved a federal claim that permitted removal. Nowotny

and Vardeleon filed their notice of removal within thirty

days of the pleading that first asserted a federal antitrust

claim, so the removal was timely, and the district court

properly denied C&A’s motion to remand.

Il.

C&A also challenges the district court’s order enforcing

a settlement agreement between the parties. We review the

court’s finding that a settlement existed for clear error.

Enterprise Rent-a-Car Co. v. Rent-a-Wreck of Am., Inc.,

181 F.3d 906, 909 (8th Cir. 1999).

Basic principles of contract formation govern the

existence and enforcement of the alleged settlement, see In

re Airline Ticket Comm’n Antitrust Litig., 268 F.3d 619,

623 (8th Cir. 2001); Sheng v. Starkey Labs., 53 F.3d 192,

194 (8th Cir. 1995), and the parties agree that Missouri law

applies in this case. Under Missouri law, a valid settlement

agreement need not be in writing. Unless the subject matter

of the settlement is governed by the statute of frauds, a

court may enforce an oral settlement agreement that

contemplates the execution of documents at a later time.

Byrd v. Liesman, 825 S.W.2d 38, 39 (Mo. Ct. App. 1992),

The essential elements of a valid settlement agreement

are the involvement of parties who are competent to

contract, a proper subject matter, legal consideration,

mutuality of obligation, and mutuality of agreement. L.B. v.

State Comm. Of Psychologists, 912 $.W.2d 611, 617 (Mo.

8a

Ct. App. 1995). There is no dispute that the alleged

settlement was made by parties competent to contract, and

the subject matter is proper.

Consideration exists when there is a detriment to the

promisee or a benefit to the promisor, Citibank (South

Dakota), N.A. v. Wilson, 160 S.W.3d 810, 813 (Mo. Ct.

App. 2005), and mutuality of obligation exists whenever

there is consideration. State ex rel. Vincent v. Schneider,

194 $.W.3d 853, 859 (Mo. 2006). The district court found

that the agreement provided a benefit to C&A. Under the

terms of the agreement, the St. Anthony’s Medical

Executive Committee would conclude its investigation of

Dr. Chaganti, St. Anthony’s would not report Dr.

Chaganti’s investigation or withdrawal to the National

Practitioners Data Bank, and Nowotny, Vardeleon, and St.

Anthony’s would release all potential claims they had

against C&A. The district court’s finding that these

provisions constituted consideration to C&A is not clearly

erroneous, and as a consequence, there was also mutuality

of obligation.

Mutuality of agreement requires “a mutuality of assent

by the parties to the terms of the contract,” i.e., a “meeting

of the minds.” L.B., 912 S.W.2d at 617. A court should

determine whether such a meeting of the minds took place

by “looking to the intentions of the parties as expressed or

manifested in their words or acts.” /d.

Here, the district court specifically found that there had

been a meeting of the minds concerning the terms of the

settlement.

We conclude that the district court’s finding was not

clearly erroneous. Reed and Naren undertook protracted

negotiations during the summer of 2004, and Reed sent

Naren a written proposed settlement on August 24, 2004.

The next day, Reed and Naren met to discuss this proposal,

and Reed avers that Naren explicitly agreed to the

settlement agreement with the stated terms in a telephone

9a

conversation that followed the meeting. Shortly thereafter,

with Naren’s approval, Reed filed a joint motion with the

district court stating that the parties had -reached an

agreement in principle. This pleading was followed by

exchanges of correspondence and efforts by Reed to secure

signed settlement agreements from Naren and Dr.

Chaganti.

The court questioned Reed and Naren during the

settlement hearing about their discussions. Naren claimed

that no settlement agreement was reached and that the

exchanges in August and September were simply ongoing

negotiations. Reed countered that Naren explicitly agreed

to the settlement agreement with the stated terms on August

25 and confirmed that agreement multiple times over the

course of the following month.

The district court then made a credibility finding,

believing Reed’s testimony that Naren had agreed to the

settlement terms over Naren’s insistence that he had not,

“Credibility determinations are within the exclusive

domain of the district court and are virtually unreviewable

on appeal.” Enterprise Rent-a-Car, 181 F.3d at 910

(internal quotation omitted). Given our deference to the

district court’s assessment of the evidence and the

circumstantial evidence supporting it, we conclude that the

court’s finding of a settlement agreement was not clearly

erroneous.

C&A argues that even if its attorney, Naren, did enter

into a settlement agreement, he had no authority to do so,

and that the agreement thus does not bind the corporation.

Under Missouri law, an attorney cannot enter into a

settlement agreement that binds a client unless that client

gives the attorney authority to do so. McDowell v. Kearns,

758 S.W.2d 481, 482-83 (Mo. Ct. App. 1988). A court,

however, will presume that an attorney has the necessary

authority if the attorney’s statements or conduct imply the

10a

authority to settle. Jd. The client then has the burden of

proving that the attorney acted without authority. Jd.

Here, the district court found, without clear error, that

Naren agreed to settle the lawsuit. C&A has not presented

compelling evidence to overcome the presumption under

Missouri law that Naren’s acts demonstrate his authority to

bind his client. The district court, moreover, examined

Naren and declined to credit his assertion that he lacked the

necessary authority. Accordingly, we hold that the court’s

finding that Naren had authority to enter into the settlement

is not clearly erroneous.

C&A also mounts a procedural challenge to the district

court’s ruling, asserting that the motion to enforce the

settlement agreement was granted without an adequate

evidentiary hearing. C&A argues that because only the

lawyers; and not the parties, were present at the hearing, it

was unable to present its evidence that no settlement

agreement was reached.

“As a general rule, an evidentiary hearing should be

held when there is a substantial factual dispute over the

existence or terms of a settlement.” Stewart v. M.D.F., inc.,

83 F.3d 247, 251 (8th Cir. 1996). A court, however, need

only hear so much evidence as is necessary for it to resolve

the “essential issues of fact” concerning the settlement. Jd.

When deciding whether to hold a hearing, a court may also

consider the need to conserve judicial resources and “the

unseemliness of holding, in effect, a mini-trial to resolve a

dispute between attorneys arising from their oral settlement

talks.” Jd. at 252. Accordingly, when “the parties’ counsel

[are] the sole witnesses-to their own conversations,” the

court may properly determine whether a settlement exists

by relying exclusively on the representations of counsel. /d.

In this case, there was a factual dispute over the

existence of the settlement, and the district court properly

held a hearing on November 30, 2004. The essential issues

of fact were whether Naren, C&A’s attorney, had agreed to

lla

settle the case, and, if so, whether Naren had the authority

to enter into a settlement agreement. The first issue

depended principally on what occurred during the

settlement negotiations between the lawyers. Reed and

Naren described those discussions at length during the

hearing.

The court properly resolved the dispute about the

existence of an agreement based on its evaluation of the

representations of counsel. Stewart, 83 F.3d at 252. As to

the second issue, the court’s finding that Naren agreed to

settle the case created a presumption that he had authority

to do so. McDowell, 758 S.W.2d at 482-83. C&A bore the

“heavy burden” to rebut this presumption, Greater Kansas

City Laborers Pension Fund v. Paramount Indus., 829 F.2d

644, 646 (8th Cir. 1987), and it had notice of the hearing

and an opportunity to present evidence, Dr. Chaganti could

have appeared in person if he so desired. Although it had

no obligation to do so, the district court even took the

initiative to contact Dr. Chaganti by telephone during the

hearing so that he could address the disputed issues. Thus,

C&A had a fair opportunity to make its case to the court

concerning the essential issues of fact — whether Naren

made an agreement and whether he had authority to do so —

and we perceive no procedural flaw in the district court’s

handling of the matter.

IV.

C&A also challenges the district court’s order holding

the corporation in civil contempt and imposing sanctions.

The district court retained jurisdiction to enforce its

judgment notwithstanding C&A’s appeal on the merits, see

In re Grand Jury Subpoenas Duces Tecum, 85 F.3d yy A

375-76 (8th Cir. 1996), so we reject the contention that the

district court lacked jurisdiction to enter the contempt

order. The district court denied C&A’s motion to stay the

order enforcing the settlement, and absent a stay from an

appellate court, the district court was within its authority to

12a

enforce the order. On the merits, we review a district

court’s imposition of a civil contempt order and assessment

of monetary sanctions for abuse of discretion. Warnock v.

Archer, 443 F.3d 954, 955 (8th Cir. 2006).

C&A contends that it did not receive prior notice that

failure to comply with the court’s order enforcing the

settlement may result in contempt sanctions. We are not

persuaded by this complaint, because the court specifically

advised C&A that it would be subject to sanctions if it

failed to comply. (J.A. at 336). C&A also argues that the

terms of the order enforcing the settlement were too vague

to justify holding C&A in contempt for failing to comply.

A contempt order must be based on a party’s failure to

comply with a “clear and specific” underlying order. Int'l

Bhd. of Elec. Workers, Local Union No. 545 v. Hope Elec.

Corp., 293 F.3d 409, 418 (8th Cir. 2002). In this case, the

underlying order to enforce settlement provided that

“plaintiff shall execute the required documents necessary to

effectuate the parties’ settlement of this matter within ten

(10) days from the date of this order. Failure to comply

with this order may result in the imposition of sanctions.”

(J.A. at 336). Although the order did not specifically

identify the “required documents,” the meaning should

have been clear to C&A based on previous pleadings in the

case and the discussions at the hearing concerning

enforcement of the settlement. Nowotny and Vardeleon

attached the proposed settlement documents to their motion

to enforce settlement, which was granted by the district

court. Reed gave Naren copies of these documents months

prior to the hearing on November 30, 2004. During the

course of the hearing, Reed briefly summarized the terms

of the settlement, and mentioned each of the attached

documents. Naren also referred to the attached documents

during the hearing. Thus, when the court granted the

motion to enforce settlement and ordered C&A to execute

the “necessary” settlement documents, there was no

13a

reasonable basis for C&A or Dr. Chaganti to doubt what

documents had to be signed. We thus conclude that the

district court’s settlement order had the clarity and

specificity required to be enforced by contempt sanctions.’

On this record, however, we are unable to uphold the

district court’s imposition of monetary sanctions. A district

court may impose civil contempt sanctions for one of two

purposes: to compensate parties aggrieved by

contumacious conduct or to coerce compliance with the

court’s orders. United States v. United Mine Workers, 330

U.S. 258, 303 (1947). When a sanction is designed to

coerce a recalcitrant party to comply, the sanction should

be payable to the court, rather than to the opposing party.

Hicks on Behalf of Feiock v. Feiock, 485 U.S. 624, 632

(1988). The court should determine the amount of the

sanction only after considering “the character and

magnitude of the harm threatened by continued

contumacy,” “the probable effectiveness of any suggested

sanction in bringing about the result desired,” and “the

amount of [the contemnor’s] financial resources and the

consequent seriousness of the burden” to that particular

party. United Mine Workers, 330 U:S. at 304. In this case,

the district court imposed a fine of $500 for each day that

Dr. Chaganti failed to sign the settlement documents.

Although the daily nature of the sanction suggests that it

may have been designed to coerce compliance, see Jnt’]

? Even if the terms of the settlement had been uncertain,

moreover, C&A had an obligation to seek clarification of the

court’s order. “[A] party to an action is not permitted to maintain

a studied ignorance of the terms of a decree in order to postpone

compliance and preclude a finding of contempt.” Perfect Fit

Indus., Inc. v. Acme Quilting Co., Inc., 646 F.2d 800, 808 (2d

Cir. 1981). If the court’s order was vague, then C&A should

have requested additional guidance from the court. By failing to

do anything, C&A violated the order.

l4a

Union v. Bagwell, 512 U.S. 821, 829 (1994), the court’s

order is not clear that coercion was the sole purpose of the

sanction. Appellees assert, to the contrary, that the sanction

is “remedial in nature” and payable to them, rather than to

the court. (Resp. Opp. to Pet. for Writ of Mandamus, at

12). Nor does the court’s order explain whether it

considered the factors that bear on the appropriate amount

for a sanction, see United Mine Workers, 330 U.S. at 304,

or how the court arrived at the sum of $500 per day. On

remand, therefore, if C&A does not promptly comply with

the court’s order to effectuate the settlement, the court

should specify whether the monetary sanctions are

compensatory or coercive in nature, and explain the basis

for whatever amount is ordered. See In re Chase &

Sanborn Corp., 872 F.2d 397, 401 (11th Cir. 1989).

2

C&A raises several other issues, namely, that the

district court erred in dismissing its state antitrust claims, in

denying its motion to amend its petition, and in quashing its

subpoenas. Because we uphold the district court’s order

enforcing settlement of all claims, these issues are moot.

We reject C&A’s request that the case be reassigned to a

different judge on remand, as nothing in the record

supports the assertion that the district court’s impartiality

may reasonably be questioned. We also deny C&A’s

motion to strike the brief of the appellees.

* kK *

For these reasons, we deny the petition for writ of

mandamus and affirm all orders of the district court, except

for the order imposing sanctions for contempt of court,

which is vacated. The case is remanded for further

proceedings consistent with this opinion.

15a

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

No: 05-1101

Chaganti & Associates, P.C.,

Appellant

V.

Thomas Nowotny and Roger V. Vardeleon,

Appellees

No: 05-2065

In re: Chaganti & Associates, P.C..,

Petitioner

No: 05-2075

Chaganti & Associates, P.C.,

Appellant

V.

Thomas Nowotny and Roger V. Vardeleon,

Appellees

Appeal from U.S. District Court for the Eastern District of

Missouri - St. Louis

(4:03-cv-00501]-HEA)

ORDER

- The petition for rehearing en banc is denied. The

petition for rehearing by the panel is also denied.

January 16, 2007

Order Entered at the Direction of the Court:

Clerk, U.S. Court of Appeals, Eighth Circuit.

/s/ Michael E. Gans

l6a

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

Nos. 05-1101, 05-2065 & 05-2075

Chaganti & Associates,

Appellant,

Vv.

Thomas Nowotny, et al.,

Appellees.

Appeal from the United States District Court for the

Eastern District of Missouri

Upon consideration of the petition for writ of mandamus

and notice of appeal from the district court's April 14,

2005, contempt and sanction order, the district court order

is hereby stayed pending further order of this court.

The appeals in 05-1101, 05-2075 and 05-2065 are hereby

consolidated.

The clerk shall issue a revised briefing schedule.

August 23, 2005

Order Entered at the Direction of the Court:

Clerk, U.S. Court of Appeals, Eighth Circuit

17a

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

No. 05-1101EMSL

Chaganti & Associates,

Appellant,

V.

Thomas Nowotny, et al.,

Appellees.

Appeal from the United States District Court for the

Eastern District of Missouri

Having reviewed the parties’ responses to the order to show

cause, it is directed that this appeal should proceed.

The clerk is directed to prepare a briefing schedule.

March 1, 2005

Order Entered at the Direction of the Court:

Clerk, U.S. Court of Appeals, Eighth Circuit

18a

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MISSOURI

EASTERN DIVISION

CHAGANTI & ASSOCIATES, P.C.,

Plaintiff,

VS.

THOMAS NOWOTNY, et al.,

‘Defendants.

Case No. 4:03CV501 HEA

MEMORANDUM AND ORDER

This matter is before the Court on defendants’ Motion

to Enforce Settlement and for Award of Fees and Costs, [#

130] . Plaintiff has filed a written opposition to this motion.

Pursuant to this Court’s oral ruling at the hearing held on

November 30, 2004, and for the reasons set forth during the

hearing, the Motion to Enforce is granted; the motion for

award of fees and costs is denied.

Accordingly,

IT IS HEREBY ORDERED that plaintiff shall

execute the required documents necessary to effectuate the

parties’ settlement of this matter within ten (10) days from

the date of this order. Failure to comply with this order may

result in the imposition of sanctions.

IT IS FURTHER ORDERED that upon the expiration

of the prescribed time period, defendant shall file, within

five (5) days thereof, the necessary pleadings required for

dismissal with prejudice of this matter.

Dated this Ist day of December, 2004.

-/s/-

HENRY EDWARD AUTREY

UNITED STATES DISTRICT JUDGE

19a

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MISSOURI

EASTERN DIVISION

CHAGANTI & ASSOCIATES, P.C..,

Plaintiff,

VS.

THOMAS NOWOTNY and

ROGER VARDELEON,

Defendants.

Case No. 4:03CV501 HEA

ORDER

This matter is before the Court on defendants’ Motion

for Contempt and/or for Sanctions, [# 144], filed on

December 14, and defendants’ Second Motion for

Contempt and/or for Sanctions, [154]. The Court held a

hearing on these motions on April 11, 2005. For the

reasons set forth below, the motions are granted as set forth

herein.

On December 1, 2004, this Court entered a

Memorandum and Order following the Court’s finding that

the parties had agreed to settle this matter.

Plaintiff was ordered to execute the documents

necessary to effectuate the settlement. As of this date,

plaintiff has failed to do so.

Although plaintiff has filed an appeal from the Court’s

Order, the Motion to Stay filed by plaintiff was denied by

the Court. Thus, plaintiff was required by the Court’s Order

to execute the required documentation, and was

admonished that failure to do so may result in the

imposition of sanctions. Plaintiff's failure to execute the

documents is in direct contravention of this Court’s Order

and is therefore a contempt of this Court. See, Fisher v.

Marubeni Cotton Corp, 526 F.2d 1338, 1341 n. 2 (8th Cir.

1975); Chicago Truck Drivers Union Pension Fund y.

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Brotherhood Labor Leasing, 207 F.3d 500, 505 (8th Cir.

2000); Rudd, et al. v. Owens, et al., Cause Number

2:02CV1599 SNL, Order dated July 30, 2004.

In addition to monetary sanctions for the contempt,

defendants ask this Court to enjoin plaintiff, its principal

and its lawyer from pursuing an EEOC claim that has been

instituted against the parties involved herein and third

parties that are not a part of this suit, but are involved in the

circumstances of this case. The Court does not agree with

defendants that by virtue of the Order requiring plaintiff to

execute the documents, the Court should also enjoin the

parties from actions which defendants believe violate the

settlement agreement. Defendants may be able to

successfully argue, as a defense to any claims filed against

them, that these claims have been released by virtue of the

settlement. The fact that plaintiff has failed to execute the

documents, however, does not empower the Court to enjoin

plaintiff's subsequent actions, rather, the Court may only

look to plaintiffs actions vis a vis what plaintiff was

required to do as articulated in the December 1, 2004

Memorandum and Order, i.e. to execute the required

documents. Whether plaintiff has subsequently breached

the settlement agreement is a separate issue and one that is

not presented to the Court through plaintiff's failure to

execute the release. The question of whether there has been

a breach of the parties’ settlement will not be addressed by

the Court through a motion for contempt.

Defendants also ask the Court to impose sanctions and

find plaintiff in contempt for disclosing information

allegedly learned at the Eighth Circuit Court of Appeals

sponsored mediation. Because the underlying information

was obtained during the proceedings in a Court other than

before the undersigned, this Court believes it would be

inappropriate to address the issues as they relate to that

mediation, even though the alleged disclosure of the

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information occurred in the matters before this Court.

Accordingly,

IT IS HEREBY ORDERED that defendants’ Motion

for Contempt and/or for Sanctions, [# 144] and defendants’

Second Motion for Contempt and/or for Sanctions, [# 154]

are granted, as provided herein.

IT IS FURTHER ORDERED that plaintiff shall be

sanctioned with a monetary fine of $500.00 per day, from

the date of this Order until such date and time it complies

with this Court’s December 1, 2004 Memorandum and

Order.

Dated this 14th day of April, 2005.

-/s/-

HENRY EDWARD AUTREY

UNITED STATES DISTRICT JUDGE