good afternoon your honour's may it please the court my name is darcy madden and i represent one of the three appellants in this claim case todd gearhart who was not a party to the underlying litigation until he was accused of and found liable for civil contempt for violating an order that was not directed to him as a result of conduct that was not specifically and unequivocally prohibited by the order of the primary me the primary issue on appeal for todd your heart is the proper construction of the order and whether the limited conduct in which he was shown to have engaged violated a specific and unequivocal provision of that order and the answer that question  axiomatic that a court must construe its orders in there only for purposes of assessing civil contempt liability a court must find by clear and convincing evidence the violation of a specific and unequivocal provision of the order and it's quite clear cases are legion holding that ambiguities must be resolved in favor of the party who is charged with contempt it is a quasi criminal remedy in this case the court did just the opposite the court repeatedly and appropriately cited to the facts and circumstances surrounding the entry of the order and the parties intent look at the plain language of the orders your customers or suppliers and that language with whom doors did business it's at least ambiguous as to whether that is the largest the scope of customers or suppliers or narrows the scope of that in this case  the party that provided the money of the todd pond todd gearhart was used as a conduit to transmit was a company called wawas song why wasn't had stopped doing business with the plaintiffs months before because they were owed millions of dollars right so they terminated their contract with the plaintiffs it would have been entirely reasonable to write an order they didn't include wallace and there's no showing for instance that anything that happened between mr doors and wallace on had any impact on whether they would have gone most reasonable interpretation of the order was the court was charged with looking at the order very narrowly and asking whether it specifically and on equivocally prevented this prohibited this conduct and it did not and the court essentially is conceded as much by repeatedly look into the facts and circumstances surrounding the entry of the order and the intent of the parties the did who did not even include tied your heart there there was an additional ambiguity in the order that helps bring this  focus and that is that the order didn't prohibit all tondo excuse me all contact with customers or suppliers it prohibited soliciting those folks for the purpose of creating a contractual or other business relationship and the court essentially read that created for the purpose of soliciting part of the order out completely but if there was it's pretty clear it says if an employer contacts you doris to create a contractual relationship with a customer with whom doris had contact he's supposed to say thank you he's not supposed to take twenty thousand dollars so if what i was saying is an employer that contacts him in order to solicit bun it's customers that's in direct violation of that so first of all there was no showing that that the money was was per provided for the solicitation knew so then your argument is not that the language doesn't prohibit would doris do and there is evidence to support it but it's that your client didn't know about the prohibition how what contempt case do you have can you think of where the answer of the respondent is well i did conceal payments but i didn't know about the order that allowed the magistrate to infer he knew about the order because he structured this incredibly tortured hidden payment structure there are for first of hide the sale of the painting it seems to me that the difference there is it was it wasn't all that clear to no sophisticated person or even too sophisticated maybe that that would have prevented her from selling her own property and here we have your client involved in  n incredibly suspicious way and your honor that clearly evidence that was in the record is the type of your heart did a favor for his father passed along this money he had nothing to do with structuring this transaction and this wasn't designed by t partners but who creates fake and phony invoices because they're feared for being sued it's at least a legitimate inference do for the magistrate say he knew about this order his dad knew about it and they made a big mistake and the though is whether it violated a specific provision that goes back to the beginning in that language seems pretty clear didn't employer contact doris to set up a relationship with with bun it's customers and what's your name way sue said they did nt to notice of this order and i believe that order did not include that second paragraph and that had he had a general awareness a vague understanding that there was some sort of an injunction but again there was no specific finding that he had any knowledge of that second paragraph about if your contact to do that and i think as a civil as a quasi and criminal remedy it has to be clear by clear and convincing evidence he has to have been on notice that his conduct  would have fallen within the order question first our position is clear and unmistakable for margaret which is that there was basically a mix and match at the lower court level between what this court has clearly distinguished in the past you've done a send you done judge joe and between a and i solicitation provision on the one hand and a non compete on the other that's where i think that the train got off the rails here because the issue that we're talking about  southwick is the provision that paragraph two that you read from deals with acts of solicitation it does not deal with a situation where you can say as the district court did in the case that the meaning of the order was to prohibit doors from having contact with the customers or suppliers a bunnet in the f i with whom he had dealt with employed by a bullet but you know you're different you didn't argue to the magistrate that oh this is legitimate payments for services not covered you said it was a gift from what was said that was part of the of the testimony in the record absolutely judge and to your point that you've made you know don't before you get off that where in the record ever in those two days did you say what you just said to joe southwick oh it's an it's in the it's in both the pre contempt hearing briefing but in the in the two day trial did you argue that these religion amid payments for services or that it was a gift from our san you know the argument  making now judge is that the that this this road was limited to antisocial taishan not non competition and so in other words the to your point earlier in the question the the evidence for the purpose of creating a business relationship during that time period if things happened before that time period before that era went into effect obviously the court can't punish somebody for that but the accord made in no the dorsey is being very careful  not using anything that records things but he gets a big chunk of money right in the middle of those two weeks and therefore he he the district where draws the inference having heard everyone and found people i think is were quite remarkable he said i almost felt it was perjury  fraud is sheer unbelievability plus inconsistent and the e mails are implicating him from all of that i infer he was soliciting in those two weeks absolutely so so you know i've been before you on both criminal and civil cases i do both and so i like to borrow from people who are a lot smarter and wiser than i am but what somebody once said that the law does not pretend to punish everything that is dishonest because that was seriously impair or unfit interfere with business and i think that's true here judge that all of this only thing this taro does it prevents you from soliciting current customers didn't the way sue say that's exactly what doris did but the timing is that's honest with you i may get something he may have done it before he didn't do it during the two weeks and then relate our thing too because that's that's the evidence isn't disputed that there was an active relationship being developed with doris not my client with doors and was on before the time of the t r o and that's why the timing of my because the the wasan slam the door on their exclusive destroy mission agreement with with the f b i nov fourteenth of twenty fifteen they did so because they were owed three point four million dollars on their arrangement that plane was could put and so because the yes and you're not disputing that the evidence supports the conclusion that doris becomes an employee of theirs for purposes of soliciting customers you're just saying that there was an evan is that he did it during that period yes or and the money payment on mon wouldn't violate the t or no it would not because if anything that money payment relates to the relationship the doors has with while the song and because while was on was a supplier to e f i at one time that was no longer a supplier then by virtue of that plane scenario it's clear that that whatever that payment was could not have been part of soliciting an agreement or understanding that it already so and it's very important judge to think about too in their brief they talk about the fact that there was quote circumstantial evidence to support the idea that somehow that doors had involvement with create contempt hearing brief and the post contempt hearing a brief right up front are the very arguments are making to you which is that the scope of the t r o is not sufficient it's an anti solicitation provision it's not a non compete there are extreme differences between the two that this court has recognized you are on a panel where that very issue came up in the context of of  under stand that i'm not show her that so but but that but that's the distinction that we believe was was very much lost here and so for that reason we believe that that is what got the thing completely off the rails from the get go now  the second point is the point that i made earlier there is no evidence other than you know circuit what they call circumstantial evidence to support the idea that there's active solicitation going on or my client is participating in that during that limited window of january thirteenth of february first the third point that we have in the brief it's obviously subsidiary to the rest of that is that discord was used as a remedy here it's clear from the record that that was intended it's what the plaintiffs asked for in their disclosures is what they asked for at the content hearing that's what the judge referred to in his in his report recommendation our position there obviously is that discourse is not appropriate in the circumstance where it's undisputed that my client i think there is evidence that he still attained these payments that you discussed but but i don't think is any evidence that he received any of that so that's a straight up legal question i think we commend to your attention and u the trial court in this case found by clear and convincing evidence following a two day evidentiary hearing and a consideration of an additional extensive factual record submitted by deposition testimony by clear and convincing evidence that the three appellants had actual notice of the t r o that finding was based on their own sworn testimony and in iraq two responses for each of them the found that each of the three contenders knew and understood that their conduct violated the t r o this was based by admissions under oath by both that the three contenders acted in concert in order to violate that with the knowledge that they were acting in concert to violate the two euro and then finally the court found by clear and convincing evidence that the three contenders acted in concert not just to violate the t r o but to conceal their violation of the t r o in the hope of what they did that specific direct evidence of what they do doing that to the evidence that is uncontroverted entirely is the evidence of the payment scheme ok so beyond that is there any activity by either of the two appellant through the two week period that is based on direct evidence that we have about the payment scheme includes violation of the terror because while the sun is a supplier said looking at the their most interesting thing about this water is that there are multiple ways that it can be violated and addresses customers as well as suppliers so your heart was a vice president of a budget and energy feeds customer in fact the very largest customer but it energy feeds while the sun was a supplier of energy feeds and then of course while i was also and energy fee customers so that even if one side had been a complete stranger even if j d high school mr todd your heart's employer of which he was a vice president had been a complete stranger the payments would have still violated the t r o because someone who reached out to mr doors first mr doors reached out that they reached out back to him there was communication back and forth and he got paid for services render violation was that he engaged in prohibited solicitation or do you think it was he had a relationship with wallace and that alone is only an ocelot situation covenant that argument is not appear below it does not appear in the counsel's papers submitted but it obviously is not if if doris had not acted in the sales capacity and in prior to the two week period and then he got paid a salary during those two week period for not for soliciting customers there would be no violation of the t r o that i would actually disagree with that your honor it wouldn't implicate that second sentence then we'd have to look at a more subtle interpretation of the first correct i think it would be a clear violation of the second set your honor if you just work for a while i was on in a non soliciting non sale capacity and he gets paid later there would have to be i understand your question better your honor there would have to be some nexus between the reason why the payment was being made and the expectation of what mr doors might do it some point but this second senates to be clear is not restricted to making payment making solicitations contemporaneous with the payment it says that mr doris is prohibited if somebody and person employer  contacts adores for the purpose of creating a contractual or other business relationship with any customer or supplier of plaintive with a hit with him to worse had contact or for him to perform services during his then the emails of the gear hurts that a we worked with him to get customers is that the primary two piece about yes there is that and then the court also did attach significance to the fact and the amount  payment the twenty thousand dollars payment there was to be clear there was a new relationship in january of two thousand and sixteen because mr doors previously had gotten paid through his wife and through his l l c that he created now he was getting paid through this pipeline of friends and neighbors going through another l l c that created by mr todd your heart in the air heard to endorse all three tests that come so they all testify both your hearts testified doris and it mr de worst testified by video conference at his request but it was like i was there theory singular that sand was just giving a gift out of appreciation or did they argue oh y year that was the defendant's principle if nots they only had two they had three issues that they were trying one issue that todd gearhart had no doubt is of the order second that it did not violate that the payment did not violate that water because it was a gift and third that the payment did not violate that water because mr doors had no business relationship at any time with the defendants or with the and so we spent a great deal of effort and a great deal of time proving that this was not a gift and there was no alternative innocent explanation ever offered by the defendants and there is a very good reason for that because mr regular heart testified repeatedly that he understood when it that he couldn't work with frank or help frank work that was his understanding of what he was prohibited from doing and that he also said that he did not read it is a distinction his own counsel mr gardner frequent emmanuel was representing him a trial and he asked mr regular heart he said ray do you read a distinction in this  testified specifically that he understood if this water enjoined frank doers from doing business with wallace on that's in the record on appeal that five to seven i believe seven seven five two seven six three seven seven mr regular hearts testimony goes over several pages from the record of appeal five four six two through five four seven one so the court when we think about again i want to be clear that it is not the appellate position that there is only a single basis for affirming this contempt but if the panel thinks it is important where there are you there distinction between knowing that this person has been ordered not to do business with another person and understanding it if i am knowing that the order also applies to me and that if i have discussions or commerce with him i am also subject testimony several times but at both his deposition and at the trial he admitted that he knew that frank was under a teacher for a restraining order frank mr doors and he admitted that district he was that mr dorsey was not supposed to be selling bypass fats that's not the same word saying that i knew that if i did participate and that i let him do it knowing that he he was ordered not to do that what an interview he knew the order applied to him we had that we had that for regular heart as a direct admission we don't have it is a direct admission from top of your heart so mr regular heart his father with him he was obviously working very closely and having extensive e mail communications where they were both commenting on how this might blow up on them and what might happen to them if they got caught and how important it was for them to cover it up mr regular heart at five four six two of the record on appeal said that he understood that he couldn't this in this is a quote couldn't work with frank or help frank work he said the same thing again and the record on appeal at five four six four i couldn't help frank work he then said the same thing again at five four seven one and what about i think in the context of this case it is a reasonable inference that todd your heart in re your white contempt land here well your honor this is a this is a civil contempt in this court has a firmed the use of circumstantial evidence for contempt on many occasions so i mean i would consider for example the the waffen schmidt case is an excellent example so i mean that is a case where there was not even any direct evidence that the it was a case where the where there was an alleged transfer where there was the original contempt or had been enjoined from dissipating the assets of a securities transaction the recipients they were more for recipients of those funds one of the issues on the before this court on appeal was whether there was a sufficient evidence that the contenders understood what they were doing was wrong when they took money and they tried to explain that they had taken money from the defendant who was enjoined for legitimate business transactions the court judge katie looked at the conduct of the person she received the funds their efforts to act in the suspicious way and hide the funds and concluded that they had noticed from simply their conduct in trying to lay transactions with the money and their demeanor at trial and this court said that that was enough to find that the defendants understood the contenders understood that what they were doing was a violation of course i did want to emphasize as well your honour's that they were calling this a temporary restraining order this was a and whether that was entered on notice and there have been extensive proceedings here so mr doors was represented by able austin texas counsel at the time the water was entered there was for briefing before that water was entered there was a hearing with the argument the order was was drafted by the participation of counsel for both sides mean i will point out that first the they point took a very targeted approach the plaintiffs did not seek to hold in contempt the friends and family of mr doris for instance who had received the fines as back one of the alleged contenders mr john franklin because it was the court was making it very clear that the court expected the plaintiffs to be able to have strong evidence the court that allowed discovery there were depositions there was document discovery there was briefing there was this two day trial the second day i think we went about six thirty at night then there was post robbery thing and then there was a very thoughtful opinion so i understand that there are cases ok on occasion that come before this court where a contempt looks like it came out of of haste or for simply this action but this is the exact opposite the order was entered with thought with thought in due deliberation and then it has been forced by the court the testimony that is the knowledge in vines set it in there was demonstrated conclusively through the witnesses own testimony the contenders own testimony in open court we are left at this point with the arguments that are before this court is what is it best arguments that were dreamt up in the law library as a second or third or fourth attempt to justify conduct that everybody knew violated this water at the time there is no risk of unfairness here there was ample notice ample opportunity to be heard to be considered and what has happened to the contenders here if this court affirms is exactly what they expected would happen to them and exactly what they predicted in their own e mails back and forth between each other at the time that they were engaged in the c further questions i will take my seat thank you thank you your honors very briefly up you heard a lot from those in council about things that frank doors did and things that and a little bit about things that frank siregar heard did you heard very little about what my client tied your heart to the fact remains the only thing that he that perhaps the exact language of the order doesn't prohibit this exact contents and i and i think that is fatal here civil contempt must be narrowly construed i also use the fake invoices to wallace and didn't he ask does this work he asked if that was what what he was being instructed to do when he said does this work that's what he was being instructed to do the evidence below is uncontroverted that he was never actually served with a copy of this temporary restraining order that perhaps they wanted to help help frame doors we talked a lot about what frank doors was doing but what tied your heart knew about what frank doors was doing was entirely lacking that actual notice piece that we talked about your hono not does not just go to the elements of the the civil contempt finding against my client it also goes to personal jurisdiction in this case there was no connection between tiger hertz activity and and the western district of texas the only way he was arguably even within the jurisdiction of the western district of texas was if he knew that the western district of texas had issued an order it would have been reasonable for him to expect to be hailed into that court there was no evidence at all no finding that he knew of the of the involvement of the western district of texas he knew of a prior state court order vaguely and that he really thought had nothing to do with him it was forwarded it by e mail he forwarded on but it wasn't addressed to him it wasn't served you they place a court three points and i'm done first point is rarely do i have a record cite to give the court in rebuttal but i do this time so i would commend the court's attention to page three nine six eight of the over six thousand page nine six eight united six a as your honor and on that page i will read it to be read for yourself but clearly the issue of the solicitation versus the competition is raised and if you remember the  magistrate judge for reasons should be obvious to everybody preferred to have the parties put their arguments in a closing brief rather than to take up more of the court's time in court so that the squarely put before the court that's point number one going on of that page of summary of the of the arguments being made second point is that with respect to the evidence that was before the court the court even found that there was no direct evidence of of a solicitation during that time period it's in the it's in the trial court mean that the magistrate judges report recommendation so judge against and we do get to the issue that you raised about circumstantial evidence in direct evidence and i'll just point out that in this area of an isis station provisions in this world judge owen as you pointed out of contempt and all it carries that you need to be very careful when you foresees an assistant provisions judge owen last year in the g e bets case eighty five if there are three eighteen as part of upholding a summary judgment and a solicitation case you held or the panel held that the contention that the plaintiff must have solicited clients because she allegedly misappropriated files with her information amounts to speculation a final court final point to this new standard for enforcement of actions that while not expressly prohibited nonetheless violate the reasonably understood terms of the order that's basically saying that we is us judges are not going to interpret the order we're going to rely on how a person who might be on the receiving end of a contempt