Can You Go to Jail for Violating a Civil Injunction?

It is no secret that private corporations exercise an enormous amount of political influence. This influence often extends to the legal system as well. But how far can prosecutors and the courts go in enforcing the demands of private business? And at what point do private citizens face potential criminal liability for acting in a manner that is contrary to the interests of a business?

11th Circuit Reverses Criminal Contempt Conviction in TASER Case

The U.S. 11th Circuit Court of Appeals recently addressed these questions in a Florida case, United States v. Robinson, in which federal prosecutors sought a criminal contempt conviction against a defendant accused of violating an injunction in a civil lawsuit. The civil lawsuit involved a company called Phazzer Electronics, Inc., which was formed by two men in the mid-2000s. Phazzer sold a stun gun called “the Enforcer.”

In 2016, TASER International, a company well known for its own line of stun guns, sued Phazzer Electronics for trademark and patent infringement and several related charges. A federal court in Florida eventually entered a judgment for TASER and in July 2017, issued an injunction against Phazzer Electronics, directing the company and its employees to cease manufacturing, selling, or distributing its Enforcer stun guns. Phazzer appealed the judge’s decision, but a federal appeals court upheld the injunction.

Despite the injunction, one of the original Phazzer founders continued his efforts to market stun guns under the Phazzer name. This led to the formation of several new entities using “Phazzer” in their names, which employed one of the original founders and another woman, who is the defendant in this case. The defendant was also a former employee of Phazzer Electronics. TASER later complained to the Court that these new Phazzer entities were violating the 2017 injunction by continuing to import and sell stun guns.

The district court then held a criminal contempt proceeding. The defendant argued that she was never a party to the original injunction, so she could not be charged with criminal contempt. The judge rejected that argument and found the defendant violated the injunction because she was an employee of one of the Phazzer companies created by the same person who founded the original company that was the subject of the injunction. The court therefore found the defendant guilty of criminal contempt and sentenced her to three weeks in prison and one year of probation.

On appeal, however, the 11th Circuit threw out the defendant’s criminal contempt conviction. The appellate court said that the defendant was not an employee or officer of the original Phazzer Electronics when the violation of the 2017 injunction occurred. Nor was she properly bound to the injunction as a non-party. As a general rule of common law, the Court noted, an injunction that applies to the “employees” of a company does not automatically extend to former employees. Such an injunction may apply to a third party who “aids or abets” an enjoined party in violating the court’s order. But the evidence did not support such a finding here. And while the 11th Circuit opened the door for charging the defendant with aiding and abetting a private party “in privity” with Phazzer Electronics–i.e., the company’s co-founder–the government never argued that theory before the district court.

Contact the Joshi Law Firm Today

If you are accused of any crime in connection with a private business, such as fraud or embezzlement, you need to take the matter seriously. An experienced Orlando white collar crimes defense lawyer can review the charges against you and advise you on a course of action. Contact the Joshi Law Firm, PA, today to schedule a consultation.

Source:

scholar.google.com/scholar_case?case=18122943324556572390