United States District Court, S.D. Illinois
TRUSTEES OF LOCAL 309 ELECTRICAL HEALTH AND WELFARE FUND, et al., Plaintiffs,
RICHARD SCHUH, d/b/a Edwardsville Electric, Defendant.
MEMORANDUM AND ORDER
Michael J. Reagan United States District Judge
(a labor union and the trustees of various employee benefit
funds) filed this suit to recover delinquent fringe benefit
contributions and liquidated damages and to otherwise enforce
obligations under labor agreements executed by Richard Schuh,
who does business as Edwardsville Electric (Defendant).
Subject matter jurisdiction lies under the federal question
statute, 28 U.S.C. 1331. In addition to damages, the
complaint prayed for an order requiring Defendant to submit
his books and records for financial examination by an
accountant, to determine the precise amounts due.
served, Defendant failed to respond to the complaint.
Plaintiffs obtained a clerk's entry of default against
Defendant under Federal Rule of Civil Procedure 55(a) on May
24, 2016. In July 2016, they moved for default judgment under
Federal Rule of Civil 55(b). The motion sought all the
components of relief requested in the complaint, including
damages and an accounting/audit of Defendant's payroll
records. The latter is required so that Plaintiffs can
"completely calculate the interest and liquidated
damages due" on the unpaid contributions for the period
in question (Doc. 11, p. 3). Defendant filed no response to
the motion for default judgment.
August 5, 2016, the undersigned District Judge granted the
motion for default judgment finding, inter alia (Doc. 13, pp.
2-3): "that Plaintiffs are entitled to an accounting and
audit (at Defendant's expense) of Defendant's books
and records to determine the precise amounts owed to
Plaintiffs for the period of January 1, 2012 through present.
Plaintiffs also are entitled to payment of unpaid
contributions owed by Defendant for that period, together
with interest and liquidated damages, reasonable
attorneys' fees, and costs incurred in this case, as set
forth in the complaint and in the motion at Doc. 11, p.
4." The undersigned directed Plaintiffs' counsel
after the audit was completed to submit a
supplemental motion and proposed order setting forth the
exact amount of each component of damages.
months later, Plaintiffs advised the Court that they had
served a copy of the August 5th Order on Defendant
by mail, and that Defendant had not responded to the Order or
produced any documents needed to complete the audit, thereby
hampering Plaintiffs (fiduciaries of the benefit funds) in
performing their duty to review the records and collect the
contributions. Plaintiffs asked for issuance of a show cause
order against Defendant.
Honorable Reona J. Daly, United States Magistrate Judge,
granted the motion on October 13, 2016, in an Order directing
Defendant to show cause why he shouldn't be sanctioned
for failure to comply with the August 5, 2016 directive.
Judge Daly ordered Defendant to respond by November 18, 2016
but did not specify what sanction or action might be imposed
if he failed to do so and did not set a hearing or direct
Defendant to appear at a specified date and place with the
payroll records. Judge Daly's Order was mailed by
Plaintiffs to Defendant on October 14, 2016 (see Doc. 17).
Defendant filed no response by the November 18th
deadline Judge Daly imposed.
December 9, 2016, Plaintiffs filed a motion asking that
Defendant be held in contempt for failure to comply with
Judge Daly's show cause Order. The December
9thmotion (supported by an affidavit from
Plaintiffs' counsel) attests that Defendant has failed to
produce any documents as directed by the August
5th default judgment Order and failed to respond
to Judge Daly's October 13th show cause Order.
Plaintiffs ask that the Court hold Defendant in contempt and,
as a sanction, (1) assess a fine of $200 per day of
noncompliance with the Court's 8/5/16 and 10/13/16
Orders, (2) award Plaintiffs their attorneys' fees and
costs resulting from Defendant's noncompliance, and (3)
issue a writ of body attachment for Defendant.
record indicates disregard by Defendant Schuh for the Orders
issued herein. And the undersigned appreciates
Plaintiffs' frustration in attempting to obtain the
payroll records to determine the amounts to which they are
entitled by the default judgment Order herein. But it is
premature to grant the December 9, 2016 motion for
contempt without an additional step being taken. So
the Court DENIES AT THIS TIME Doc. 21, as explained below.
motion asks the Court to hold Defendant in civil contempt for
refusing to comply with lawful orders issued in this case.
Caselaw makes clear that a court's contempt power must be
exercised with utmost restraint. Similarly, a court's
inherent power to sanction a party for conduct which abuses
the judicial process (e.g., by assessing attorney's fees
as a sanction), "must be exercised with restraint and
discretion." Trade Well Intern, v. United Cent.
Bank, 778 F.3d 620, 626 (7th Cir. 2015),
citing Chambers v. Nasco, Inc., 501 U.S. 32, 44
(1991). The Seventh Circuit recently explained that the civil
contempt and criminal contempt are governed by significantly
distinct procedures and designed to achieve different
purposes, so a district court must take care not to blur the
lines in handling a motion for contempt.
general rule, civil contempt relief is coercive or remedial.
It is "designed either to compel the contemnor into
compliance with an existing court order or to compensate the
complainant for losses sustained as a result of the
contumacy." Lightspeed Medial Corp. v. Smith,
830 F.3d 500, 508 (7th Cir. 2016), quoting
United States v. Dowell, 257 F.3d 694, 699
(7th Cir. 2001). Criminal contempt sanctions are
punitive, meant to "vindicate the authority of the
court." Id. Civil contempt may be imposed if
proven by clear and convincing evidence, but criminal
contempt can be imposed only after the alleged contemnor has
been afforded the full protections the Constitution provides
for criminal proceedings (and the procedures set forth in
Federal Rule of Criminal Procedure 42, which include notice,
appointment of a prosecutor, and a trial).
Lightspeed, 830 F.3d at 508, citing Dowell,
257 F.3d at 699, and Hicks ex rel. Feiock v. Feiock,
485 U.S. 624, 632 (1988).
can be a form of civil contempt or criminal
contempt. A monetary penalty for a wrong committed in federal
court is civil if designed to compensate for harm done but
criminal if its purpose is to vindicate the court's
authority. Lightspeed, 739 F.3d at 508. See also
Autotech Tech. LP v. Integral Research & Dev. Corp.,
499 F.3d 737, 752 (7thCir. 2007), cert,
denied, 562 U.S. 1231 (2008) (Civil contempt sanctions
"must relate" to one of two purposes - compel
compliance with a court order or compensate the complainant
for a loss caused by the contemptuous action; if the former,
the court must consider the "character and magnitude of
the harm threatened ... and the probable effectiveness of any
suggested sanction in bringing about the desired
undersigned believes the appropriate next step is for Judge
Daly - by separate Order to be served on Defendant by the
United States Marshals Service (with proof of service
made in the record) - to set an in-court hearing at a
specified date and time, and order Defendant to attend and
produce the relevant payroll records. Defendant should be
plainly warned that if he fails to appear and
produce the records at the show cause hearing, the Court then
will reconsider (and set an in-court hearing on) the motion
at Doc. 21, and will issue a writ of body attachment to bring
Defendant before Judge Daly for a hearing on the imposition
of possible sanctions, including civil contempt proceedings
or whatever other sanction Judge Daly deems applicable and
Clerk's Office shall send a copy of this Order by
certified mail to Defendant at the address listed in Doc. 17
(and make an ...