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

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 2006

## Text

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.

20a

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

2la

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

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386016_2247%3A1. Public record. Not legal advice.