The Fifth Circuit Court of Appeals dropped a dozy of a ruling last night when they vacated the contempt order issued by Federal District Court Judge Kenneth Hoyt on behalf of Catherine Engelbrecht and Gregg Phillips.
In their ruling, they reprimanded Hoyt for issuing the contempt order (and other orders) in the first place to try and force Engelbrecht and Phillips to identify their sources regarding the hacking of Konnech’s servers in China.
They ruled that the judge was mandating such a request to Engelbrecht and Phillips on behalf of the plaintiff and that was completely inappropriate.
They argued that the plaintiff should have been allowed to pursue this through Rule 12 motions and discovery, and that Catherine Engelbrecht and Gregg Phillips should have been allowed to respond before any such mandate was ever issued by the judge.
They even say “that is not how the Federal Rules of Civil Procedure work.”
Plaintiff in the district court, Konnech, Inc., sued petitioner-defendants for hacking Konnech’s computers. The district court then used a temporary restraining order, a preliminary injunction, and a civil-contempt order to litigate the case on Konnech’s behalf. For example, prong (v) of the now-dissolved TRO required petitioner-defendants to “identify each individual and/or organization involved in accessing [Konnech’s] protected computers.” Such a demand makes perfect sense when made by a plaintiff in discovery. But the record does not reveal what sort of emergency justified the district court’s demand for that information before the parties could file Rule 12 motions, before the defendants could file an answer, before the parties could file their initial disclosures, or before discovery could begin let alone conclude in the ordinary course. Much less did the district court explain what sort of emergency could warrant jailing the petitioner-defendants for not making such immediate disclosures. Rather, the district court made clear that it was imposing its disclosure requirements because it—the district court—wanted to add defendants to the lawsuit. That is not how the Federal Rules of Civil Procedure work.
The ended their order by vacating the judge’s contempt:
It is not clear whether the district court intends to employ any further coercive measure in connection with its prior contempt order, or in connection with the more recent preliminary injunction. And the merits of any appeal from the district court’s preliminary injunction are not before us. Accordingly, we VACATE the contempt order because the district court premised it on the now-dissolved TRO. The case is REMANDED to the district court for further proceedings consistent with the Federal Rules. Any future appellate proceedings regarding any future contempt orders shall be directed to and decided by this panel.
You can read the entire 3-page order below. It’s a good read: