CLEARONE COMMUNICATIONS, INC. v. Bowers
2011 U.S. App. LEXIS 14107
| 10th Cir. | 2011Background
- Underlying trade secrets case involved WideBand and related entities; asset transfer to WideBand Georgia occurred in June 2008.
- District court issued TROs and a preliminary injunction limiting transfer of Honeybee Code and related assets; Frails represented Donald Bowers at hearings.
- Jurisprudence developed through multiple hearings in 2008-2009; by November 2008 ClearOne obtained a jury verdict in its favor on all claims.
- February 2009 show-cause and contempt proceedings began against WideBand defendants and Donald Bowers for alleged TRO violations; Bowers failed to appear at one hearing.
- April 2009 permanent injunction entered; July 2009 show-cause ordering appearance and testimony; August 2009 TRO extended to DialHD and related entities.
- October 2010 district court determined contempt and issued bench warrants; November 2010 Notice of Appeal filed by Donald Bowers.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether district court erred in contempt findings | ClearOne asserts Bowers violated TROs and injunctions via asset transfers and related conduct. | Bowers argues lack of proof he personally violated orders and disputes evidentiary support. | No reversible error; contempt affirmed. |
| Whether district court properly exercised personal jurisdiction over Bowers | ClearOne contends nonparty Bowers violated orders and thus fell within court’s contempt authority. | Bowers argues lack of minimum contacts and that he is a nonresident nonparty. | District court had jurisdiction over Bowers for contempt. |
| Whether July 17, 2009 show-cause order violated due process | ClearOne contends order properly informed and allowed hearing; nonappearance was voluntary. | Bowers claims lack of accommodation for travel/illness and improper reliance on redacted materials. | Due process satisfied; order did not violate rights. |
| Whether district court should have recused | Not applicable beyond standard recusal analysis; district court denial upheld. | Bowers argues district judge had financial interest through spouse's firm. | No abuse of discretion; recusal not required. |
Key Cases Cited
- Silvaco Data Systems v. Intel Corp., 184 Cal.App.4th 210 (Cal. Ct. App. 2010) (nonparty liability distinction; trade secret context)
- Waffenschmidt v. MacKay, 763 F.2d 711 (5th Cir. 1985) (nonparties may be held in contempt for aiding violations of injunctions)
- Homa v. SEC, 514 F.3d 661 (7th Cir. 2008) (contempt jurisdiction over nonparties who knowingly violate injunctions)
- Canterbury Belts Ltd. v. Lane Walker Rudkin, Ltd., 869 F.2d 34 (2d Cir. 1989) (nonparty contempt jurisdiction limits)
- De Beers Consol. Mines v. United States, 325 U.S. 212 (U.S. 1945) (purpose of preliminary injunction to preserve status quo)
- Goss v. Lopez, 419 U.S. 565 (U.S. 1975) (due process requires notice and opportunity to be heard)