Zest Anchors, LLC v. Geryon Ventures, LLC

District Court, S.D. California · 3:22-cv-00230 · 2023-02-21 · Unknown

Proceeding: district
Area: civil
On appeal: Zest Anchors, LLC v. Geryon Ventures, LLC (2023-04-05) — reversed in part — the Ninth Circuit's later ruling on this docket
Panel: Todd W. Robinson (author)

Analysis

A model's reading — qwen3.8-27b, prompt own-v1, 2026-10-13T22:08Z · confidence high

The court reviewed a second compliance affidavit filed by defendants in response to a prior contempt order and found that the defendants were in compliance with the preliminary injunction as of February 17, 2023. The court calculated and ordered the defendants to pay a $77,000 civil contempt fine to the United States Treasury.

What the court decided	The model
Finding that defendants are in compliance with the preliminary injunction “Based on the Second Compliance Affidavit, the Court FINDS that Defendants are compliance with the Court’s July 18, 2022 Order Granting in Part and Denying in Part Plaintiffs’ Motion for Preliminary Injunction (the “Preliminary Injunction,” ECF Nos. 49 (public) & 50 (sealed)) as of February 17, 2023.”	agree with court The court relied on the CEO's sworn affidavit affirming that the defendant would sell solely the unmodified product to its only U.S. distributor. In the context of a preliminary injunction, a sworn statement of compliance from the party's CEO is generally sufficient to establish that the party has ceased the enjoined conduct, absent evidence to the contrary. The finding is supported by the record recited in the order.
Ordering payment of a $77,000 civil contempt fine “The Court therefore calculates Defendants’ total fine to be $77,000. Pursuant to Civil Local Rule 83.1, Defendants SHALL PAY the $77,000 fine to the Miscellaneous Fines, Penalties and Forfeitures, Not Otherwise Classified, fund of the United States Treasury within thirty (30) days of the date which this Order is electronically docketed.”	agree with court The court calculated the fine based on the per diem rate established in the prior order ($1,000/day) from the start date (Dec 2, 2022) to the date of compliance (Feb 17, 2023). The calculation (77 days x $1,000) is mathematically correct. The court cited General Signal Corp. v. Donallco to support the proposition that coercive fines are payable to the court, which aligns with the order directing payment to the Treasury fund. The decision follows from the prior contempt order and the new compliance finding.

What the court decided

The model

Finding that defendants are in compliance with the preliminary injunction

“Based on the Second Compliance Affidavit, the Court FINDS that Defendants are compliance with the Court’s July 18, 2022 Order Granting in Part and Denying in Part Plaintiffs’ Motion for Preliminary Injunction (the “Preliminary Injunction,” ECF Nos. 49 (public) & 50 (sealed)) as of February 17, 2023.”

agree with court
The court relied on the CEO's sworn affidavit affirming that the defendant would sell solely the unmodified product to its only U.S. distributor. In the context of a preliminary injunction, a sworn statement of compliance from the party's CEO is generally sufficient to establish that the party has ceased the enjoined conduct, absent evidence to the contrary. The finding is supported by the record recited in the order.

Ordering payment of a $77,000 civil contempt fine

“The Court therefore calculates Defendants’ total fine to be $77,000. Pursuant to Civil Local Rule 83.1, Defendants SHALL PAY the $77,000 fine to the Miscellaneous Fines, Penalties and Forfeitures, Not Otherwise Classified, fund of the United States Treasury within thirty (30) days of the date which this Order is electronically docketed.”

agree with court
The court calculated the fine based on the per diem rate established in the prior order ($1,000/day) from the start date (Dec 2, 2022) to the date of compliance (Feb 17, 2023). The calculation (77 days x $1,000) is mathematically correct. The court cited General Signal Corp. v. Donallco to support the proposition that coercive fines are payable to the court, which aligns with the order directing payment to the Treasury fund. The decision follows from the prior contempt order and the new compliance finding.

The order itself: sound — The order is a straightforward procedural resolution of a contempt matter. It correctly identifies the basis for the compliance finding (the affidavit) and the basis for the fine (the prior order's per diem rate and the duration of non-compliance). It cites the appropriate local rule and a relevant circuit case for the disposition of the funds. There are no significant gaps or questionable reasoning.

How this analysis was made · dispute it

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 ZEST ANCHORS, LLC d/b/a Zest Case No.: 22-CV-230 TWR (NLS) DentalSolutions and ZEST IP 12 HOLDINGS, LLC, ORDER (1) FINDING DEFENDANTS 13 TO BE IN COMPLIANCE WITH Plaintiffs, PRELIMINARY INJUNCTION, AND 14 v. (2) DIRECTING PAYMENT OF 15 SANCTION GERYON VENTURES, LLC d/b/a 16 DESS-USA and TERRATS MEDICAL (ECF Nos. 134, 136) SOCIEDAD LIMITADA, 17 Defendants, 18 19 BIOMET 3I, LLC d/b/a ZimVie, 20 Intervenor-Defendant. 21 22 Presently before the Court is the Declaration of Roger Terrats re: Compliance with 23 Preliminary Injunction and Subsequent Orders (“2d Comp. Aff.,” ECF No. 136), filed by 24 Defendants and Counterclaimants Geryon Ventures, LLC, doing business as DESS-USA 25 (“Geryon”), and Terrats Medical Sociedad Limitada (“Terrats”) (together, “DESS”) in 26 response to the Court’s February 7, 2023 Order (1) Striking Defendants’ Compliance 27 Affidavit, (2) Imposing Per Diem Fine Per Contempt Order, and (3) Denying as Moot 28 Intervenor’s Motion to Clarify. (See ECF No. 134 (the “Feb. 7, 2023 Order”).) In his 1 ||Second Compliance Affidavit, Terrats’s CEO affirms that Terrats will sell to Intervenor- 2 || Defendant and Counterclaimant Biomet 31, LLC dba ZimVie (“ZimVie”)—Terrat’s only 3 || distributor of DESSLoc® products in the United States—‘solely ‘the unmodified 4 || DESSLoc® abutment.’” (See 2d Comp. Aff. □ 5.) 5 Based on the Second Compliance Affidavit, the Court FINDS that Defendants are 6 compliance with the Court’s July 18, 2022 Order Granting in Part and Denying in Part 7 || Plaintiffs’ Motion for Preliminary Injunction (the “Preliminary Injunction,” ECF Nos. 49 8 (public) & 50 (sealed)) as of February 17, 2023. In its February 7, 2023 Order, the Court 9 ||imposed a $1,000 per diem fine beginning December 2, 2022, until Defendants “file[d] a 10 || further compliance affidavit.” (See Feb. 2, 2023 Order at 8.) The Court therefore calculates 11 ||Defendants’ total fine to be $77,000. Pursuant to Civil Local Rule 83.1, Defendants 12 SHALL PAY the $77,000 fine to the Miscellaneous Fines, Penalties and Forfeitures, Not 13 || Otherwise Classified, fund of the United States Treasury within thirty (30) days of the date 14 which this Order is electronically docketed. See, e.g., Gen. Signal Corp. v. Donallco, 15 787 F.2d 1376, 1380 (9th Cir. 1986) (“If the fine, or any portion of the fine, is coercive, 16 |/it should be payable to the court.”). Defendants SHALL SUBMIT a copy of this Order 17 || along with their payment and SHALL FILE a notice with the Court that the sanction has 18 || been paid. 19 IT IS SO ORDERED. 20 || Dated: February 21, 2023 — [5 14 bre Honorable Todd W. Robinson United States District Judge 23 24 25 26 27 28