Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-alnd-5_05-cv-01700/USCOURTS-alnd-5_05-cv-01700-0/pdf.json

Parties Involved:
Arrowhead Farms
Defendant
Kathy Barnes Haynes
Defendant
Carroll Douglas Haynes
Defendant
Sirmon Produce, Inc
Plaintiff

Document Text:

Doc. no. 17 (Motion to Enforce Settlement Agreement). 1

 Doc. no. 18 (Show Cause Order). 2

 It appears that defendant Kathy Barnes Haynes has passed away since this action has been 3

closed. See doc. no. 19 (Response in Opposition to Motion to Enforce), p. 1.

 Doc. no. 20 (Reply in Support of Motion to Enforce). 4

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ALABAMA

NORTHEASTERN DIVISION

SIRMON PRODUCE, INC., )

 )

Plaintiff, )

 )

vs. )

 ) Civil Action No. 05-S-1700-NE

CARROLL DOUGLAS HAYNES, )

d/b/a Arrowhead Farms, and )

KATHY BARNES HAYNES, )

 )

Defendants. )

MEMORANDUM OPINION

This action, which was settled and closed nearly nineteen months ago, now is

before the court on plaintiff’s motion to enforce the settlement agreement. Shortly 1

after receiving the motion, the court entered an order requiring defendants to show

cause why the relief requested should not be granted. The court now is in receipt of

2

defendant Carroll Douglas Haynes’ response, as well as the reply filed by plaintiff. 3 4

Briefly, the facts are as follows: plaintiff Sirmon Produce, Inc., is in the

business of buying and selling wholesale quantities of perishable agricultural

FILED

 2007 Mar-07 PM 03:50

U.S. DISTRICT COURT

N.D. OF ALABAMA

Case 5:05-cv-01700-CLS Document 21 Filed 03/07/07 Page 1 of 6
 Doc. no. 1 (Complaint). 5

 Doc. no. 8 (Temporary Restraining Order). 6

See doc. no. 17, Affidavit of Katy L. Koestner, Ex. 2 (Settlement Agreement). 7

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commodities in interstate commerce. Between December 2004, and May 2005,

Sirmon Produce sold such commodities to defendant Haynes, doing business as

“Arrowhead Farms.” Haynes, however, failed to remit the $157,965 due as

consideration for the commodities tendered. This resulted in the automatic

imposition of a statutory trust in the amount of $157,965 under 7 U.S.C. § 499e(c)(2),

a keystone provision of the Perishable Agricultural Commodities Act of 1930, 7

U.S.C. § 499a et seq.

Sirmon Produce filed this action to enforce the statutory trust, and sought

immediate injunctive relief. Following the issuance of a temporary restraining

5

order, the court convened a hearing on Sirmon Produce’s request for a preliminary 6

injunction and received testimony from Haynes. Before the hearing was completed,

the parties conferred privately and negotiated a settlement agreement, which was

recited in open court and subsequently reduced to writing. In pertinent part, the 7

settlement agreement declared that:

[U]pon payment by Haynes to Sirmon of $157,965.00, plus

interest accruing but unpaid at the rate of 6% per annum from Friday,

August 19, 2005 . . . , in full, shall constitute a full satisfaction of all

amounts claimed by Sirmon Produce herein.

. . . 

Case 5:05-cv-01700-CLS Document 21 Filed 03/07/07 Page 2 of 6
Id. at pp. 1-3 (internal numbering omitted). 8

 Doc. no. 15 (Order of Dismissal). 9

 Doc. no. 17, Affidavit of Katy Koestner, Ex. 3 (Spreadsheet of Payments Received). 10

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Haynes agrees to pay Sirmon Produce five thousand dollars

($5,000.00) before 5:00 p.m. EST on the first business day of each

month toward the Indebtedness.

. . . 

Haynes will be in default of this Stipulation if he failsto make any

payment when due, and the non-payment continues for ten (10) calendar

days after Sirmon Produce delivers written notice of nonpayment to

Haynes, [or] Haynes’ counsel.

. . . 

In the event of a Default, Sirmon Produce may file the

“Stipulation to Reopen Case and Enter of Judgment”, executed by

Haynes and Sirmon Produce contemporaneously herewith and attached

hereto as Exhibit “A”, requesting the Court to reopen this case, and enter

a judgment in favor of Sirmon Produce and against Haynes in the

amount of $157,965.00, plus interest accruing at the rate of 6% per

annum from Friday, August 19, 2005, plus attorney’s fees in enforcing

the terms of this Stipulation, less any payments made. Further, the

parties hereto stipulate and agree that, upon Default, Sirmon shall be

entitled to entry of the Stipulated Preliminary Injunction [executed by

the parties] and attached hereto as Exhibit “B” upon notice and motion.8

In view of the above, the court dismissed the action, but retained jurisdiction

to enforce the settlement agreement. Subsequent to the dismissal, Haynes tendered 9

$40,000 toward the $157,965 owed, but eventually ceased making payments. After 10

several months of non-payment, Sirmon Produce filed the present motion to reopen

the case and enter judgment in its favor in the amount of $117,965 (plus attorneys’

Case 5:05-cv-01700-CLS Document 21 Filed 03/07/07 Page 3 of 6
 Sirmon Produce also seeks entry of the stipulated preliminary injunction order appended 11

to the settlement agreement. See doc. no. 17, Affidavit of Katy Koestner, Appended Ex. B

(Stipulated Preliminary Injunction Order).

 Doc. no. 19, ¶ 1. 12

Id. at ¶¶ 4-5 (internal numbering omitted). 13

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fees and interest). Haynes does not dispute that he is in arrears, but contends that 11 12

the settlement agreement is due to be modified or declared unenforceable because it

does not include any provisions discussing the collateral agreement regarding

confidentiality that was reached between the parties and recited in open court. More

specifically:

During the hearing regarding [a] preliminary injunction in this

case, certain questions were posed to Mr. Haynes regarding his pricing.

During that testimony there was an objection interposed regarding the

confidential and proprietary nature of such pricing information. In open

court, on the record, an agreement was reached regarding the

confidentiality of the use of this information solely for relevant and

material purposes in this action and for no other purpose, including, but

not limited to competitive purposes.

Haynes has been informed by Schoenmann Produce Corporation,

which coordinates delivery of potatoes to Wal-Mart, that Sirmon has

used the pricing data in order to undercut potato prices of Haynes,

thereby cutting approximately 180 to 200 containers per week from

Haynes’ operation.13

The court has reviewed the hearing transcripts and the settlement agreement

and can confirm that, although the confidentiality agreement was in fact noted on the

record, no mention thereof is made in the settlement contract. On the other hand, the

Case 5:05-cv-01700-CLS Document 21 Filed 03/07/07 Page 4 of 6
 Doc. no. 20, ¶¶ 1-3 (internal numbering omitted) (emphasis supplied). 14

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stipulation recited in court does not contemplate the effect of a breach of the

confidentiality agreement. Moreover, Haynes’ claim that Sirmon Produce has been

utilizing confidential pricing information to undersell him is vigorously disputed by

Sirmon:

First, Plaintiff submits Defendant Carroll Douglas Haynes d/b/a

Arrowhead Farms (“Haynes”) has failed to identify what specific

“confidential information” was (a) disclosed at the August 19, 2005

[hearing], and (b) subsequently used by Plaintiff in order to undercut

Defendant’s pricing.

Second, the allegations contained within the opposition of

Defendant to Plaintiff’s Motion to Enforce the Settlement Agreement

are wholly [de]void of evidentiary support. Defendant has failed to

provide any sworn statements by any of the alleged witnesses identified

therein, including Defendant Haynes, and has failed to produce or

identify any documents which support Defendant’s allegations.

Notably, Defendant failed to respond to [counsel for plaintiff’s] request

for facts and documents supporting his allegations.

Conversely, Plaintiff has filed the sworn affidavits of James

Sirmon and Ted Suttle which deny the allegations made by the

Defendant.14

Although the court is sympathetic to Haynes’ allegations of wrongdoing, it

must agree with Sirmon Produce. If Haynes truly possessed information probative

of the confidentiality claim, he should have produced it to the court in responding to

the Show Cause Order. As it stands, the court has reviewed nothing more than

Case 5:05-cv-01700-CLS Document 21 Filed 03/07/07 Page 5 of 6
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uncorroborated hearsay from Haynes and his attorney. Even assuming that a breach

of the confidentiality agreement would relieve Haynes of his obligations under the

settlement agreement, the court has not seen enough evidence of any breach to justify

taking the matter up at a hearing.

Accordingly, the motion to enforce the settlement agreement will be granted

to the extent that it declares Haynes in default and requests the entry of the stipulated

preliminary injunction. On the other hand, Sirmon Produce also requests that the

court enter judgment in its favor, awarding it $117,965 plus interest, and plus

attorneys’ fees, but does not specify either in its briefs or in the proposed order the

total amount requested. It is not the court’s practice to enter such imprecise

judgments, and therefore the motion will be denied without prejudice to the extent it

seeks that relief. Instructions for a renewed motion will be set forth in a separate

order entered contemporaneously herewith.

DONE this 7th day of March, 2007.

______________________________

United States District Judge

Case 5:05-cv-01700-CLS Document 21 Filed 03/07/07 Page 6 of 6