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APPEALS FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS. Hon. Michael A. Ponsor, U.S. District Judge.
Edward Griffith, with whom Michael K. Callan, Doherty, Wallace, Pillsbury, and Murphy, P.C., and The Griffith Firm were on brief, for appellants.
William E. Reynolds, with whom Bond, Schoeneck & King, PLLC was on brief, for appellee.
Before Lynch, Chief Judge, Stahl and Kayatta, Circuit Judges.
STAHL, Circuit Judge.
This is a companion case to AngioDynamics v. Biolitec AG, No. 14-1603. In this appeal, Defendants argue that the district court exceeded the bounds of its authority when it issued civil contempt sanctions after Defendants violated the court's preliminary injunction order. Defendants also aver that the district court should have vacated the underlying preliminary injunction. We affirm.
I. Facts & Background
This court previously set out the basic factual contours of this case in AngioDynamics, Inc. v. Biolitec AG, 711 F.3d 248 (1st Cir. 2013) (per curiam). Plaintiff AngioDynamics, Inc. (" ADI" ) obtained a $23 million judgment in New York against defendant Biolitec, Inc. (" BI" ), a New Jersey corporation with its principal place of business in Massachusetts, based on an indemnification clause in the supply and distribution agreement governing BI's sale of medical equipment to ADI. Plaintiff sought to secure payment on that judgment by bringing suit in the District of Massachusetts against BI's President and CEO, Wolfgang Neuberger, and its corporate parents, Biomed Technology Holdings (" Biomed" ) and Biolitec AG (" BAG" ) (collectively, " Defendants" ), alleging that Defendants had looted BI of over $18 million in assets in order to render it judgment-proof.
We will recount only the portions of the procedural background of this case pertinent to the issues raised in this appeal. In August 2012, ADI learned that BAG planned to merge with an Austrian subsidiary. Since American judgments are unenforceable in Austria, the merger would place BAG's assets out of ADI's reach. The district court issued a temporary restraining order -- later converted into a preliminary injunction -- barring the merger. Defendants unsuccessfully filed a motion to vacate the injunction in the district court, then appealed. In March 2013, while that appeal was still pending, Defendants effected the merger anyway, moving BAG's corporate domicile from Germany to Austria. This court affirmed the preliminary injunction on April 1, 2013, the same day as that panel heard oral argument. AngioDynamics, 711 F.3d at 252.
ADI filed an emergency motion for contempt shortly after learning that BAG had merged with its Austrian affiliate. On April 11, 2013, the district court issued a twenty-page contempt decision authorizing coercive fines against Defendants and a warrant for Neuberger's arrest. AngioDynamics, Inc. v. Biolitec AG, 946 F.Supp.2d 205, 215 (D. Mass. 2013). The monthly fines escalate in amount each month that the merger remains in place. Id. at 216. ...