GUCCI AMERICA, INC., Plaintiff, v. Jennifer GUCCI, Jenco Designs, LLC, Jennicor, LLC, Jenny Gucci Coffee and Gelato Company, Inc., Veratex, Inc., Collezione DI Casa, Inc., E.L. Erman-Dead SEA Cosmetics Corp., ELE Brands Enterprise, Inc., GBN Watch Collection, Inc., GBN Global Business Network, Edward Litwak d/b/a ED Litwak & Associates, Gemma Gucci, Gemma Gucci Coffee and Gelato Company, Inc., ABC Corporations 1-10, and John Does 1-10, Defendants No. 07 Civ. 6820(RMB)(JCF) United States District Court, S.D. New York February 20, 2009 Francis IV, James C., United States Magistrate Judge MEMORANDUM AND ORDER *1 Gucci America, Inc. (“Gucci”) brings this action charging the defendants with trademark infringement, trademark counterfeiting, false designation of origin, trademark dilution, unfair competition, and unfair and deceptive trade practices, in violation of the Lanham Act and state law. The Court issued a temporary restraining order on August 20, 2007 (the “TRO”) on consent of the parties. Gucci now moves for contempt sanctions on the ground that one defendant, Edward Litwak, has violated the terms of the TRO. A hearing was held on January 23, 2009, and for the following reasons, the motion is granted in part and denied in part. Background The gravamen of the complaint in this case is that Jennifer Gucci, the widow of former Gucci designer Paolo Gucci, has licensed products using the name “Gucci” together with graphics confusingly similar to trademarks owned by the plaintiff. Some of these products have been licensed through Edward Litwak, doing business as Ed Litwak & Associates. When the action was commenced, Gucci was aware of allegedly infringing goods being marketed by defendant Veratex, Inc., a manufacturer and distributor of bedding and other home textiles. At the same time that it filed the complaint, Gucci moved by Order to Show Cause for permission to take expedited discovery. Following a hearing on that motion, the parties agreed to an accelerated discovery schedule and to the terms of a temporary restraining order. The TRO provided in part that the defendants were enjoined from: 1. licensing, sublicensing, manufacturing, importing, exporting, advertising, promoting, displaying, distributing, circulating, offering for sale, selling or otherwise disposing of in any manner or removing from their respective business premises (except as otherwise provided herein) any products bearing the JENNIFER GUCCI name; and 2. imitating, copying or making unauthorized use of the following federally-registered trademarks owned by Gucci, including: U.S. Trademark Reg. Nos. 876,292, 959,338, 972,078, 1,093,769, 1,140,598, 1,168,477, 1,169,019, 1,168,922, 1,200,991, 1,202,802, 1,321,864, and 1,340,599 for the GUCCI word mark; U.S. Trademark Reg. Nos. 1,122,780, 1,123,224, and 1,483,536 for Gucci's Green-Red-Green Stripe Design; and U.S. Trademark Reg. Nos. 2,680,237, 3,072547, and 3,072,549 for Gucci's Repeating GG Design. (TRO, attached as Exh. A to Declaration of John Maltbie dated Dec. 31, 2008 (“Maltbie Decl.), at 3-4). The defendants were further required to provide a copy of the TRO to “all parties with whom they, individually or collectively, have entered into license agreements, written or oral, for the use of the JENNIFER GUCCI name,” and to provide Gucci with a list of all entities receiving such notice. (TRO at 4). Finally, the TRO incorporated the parties' agreement to expedited discovery, requiring, among other things, that the defendants provide responses within seven days to discovery demands previously served by Gucci. (TRO at 2, ¶ 1). *2 Gucci now contends that Mr. Litwak should be held in contempt for violating the TRO. Specifically, Gucci argues that Mr. Litwak violated the TRO in three ways: (1) he entered into a licensing agreement for the sale and distribution of Jennifer Gucci brand water products; (2) he failed to provide a copy of the TRO to parties with whom he had contracted; and (3) he failed to produce the required discovery materials. I will address each allegedly contemptuous act in turn, providing additional facts to the extent they are relevant. Discussion A determination of contempt must be predicated on three findings: (1) that the order allegedly violated is clear and unambiguous; (2) that the proof of noncompliance is clear and convincing; and (3) that “the contemnor has not diligently attempted to comply in a reasonable manner.” Paramedics Electromedicina Comercial, Ltda. v. GE Medical Systems Information Technologies, Inc., 369 F.3d 645, 655 (2d Cir.2004) (quoting King v. Allied Vision, Ltd., 65 F.3d 1051, 1058 (2d Cir.1995)). To be clear and unambiguous, the order must be “specific and definite enough to apprise those within its scope of the conduct that is being proscribed.” Mingoia v. Crescent Wall Systems, No. 03 Civ. 7143, 2005 WL 991773, at *1 (S.D.N.Y. April 26, 2005) (quoting Panix Promotions, Ltd. v. Lewis, No. 01 Civ. 2709, 2004 WL 421937, at *2 (S.D.N.Y. March 5, 2004)). Contempt may be either civil or criminal, depending upon “the substance of the contempt proceeding and the ‘character and purpose’ of the sanction involved,” D'Orange v. Feely, 959 F.Supp. 631, 637 (S.D.N.Y.1997) (citing Gompers v. Bucks Stove & Range Company, 221 U.S. 418, 441 (1911)). “A contempt sanction is considered civil if it is remedial and for the benefit of the complainant, and criminal if it is punitive, to vindicate the authority of the court.” D'Orange, 959 F.Supp. at 637. A. The Water Contract On some unspecified date, a man named Joseph Balistreri began discussing with Mr. Litwak the possibility of obtaining a license to use Jennifer Gucci's name in connection with marketing certain water products. (Deposition of Joseph C. Balistreri dated Dec. 29, 2008 (“Balistreri Dep.”), attached as Exh. O to Declaration of John Rosenthal dated Jan. 14, 2009 (“Rosenthal Decl.”), at 11). In approximately April 2007, Mr. Balistreri again contacted Mr. Litwak, and negotiations began in earnest. (Balistreri Dep. at 15). In June, Mr. Litwak sent Mr. Balistreri a draft agreement that contained all of the terms for a water products license. (License Agreement, attached as part of Exh. G to Rosenthal Decl.; Tr. at 52-53;[1] Balistreri Dep. at 16-17). That agreement, however, was never executed. According to Mr. Balistreri, I think it was like in June that we were going to do a contract. And we started getting it all ready, and at that point Ed [Litwak] wanted to hold things up because of the court. He started telling me about what was going on with Jennifer. *3 (Balistreri Dep. at 16). This is generally consistent with Mr. Litwak's testimony. Mr. Litwak acknowledges that he sent Mr. Balistreri a draft licensing agreement, including financial terms he thought the parties “could live with.” (Tr. at 36). However, discussions over the contract were sidetracked when the TRO issued; Mr. Litwak seems to have understood that while he could continue to discuss potential terms, he could not enter into a binding agreement. (Tr. at 36-37). Nevertheless, Mr. Litwak did solicit a payment of $10,000 from Mr. Balistreri, which he initially characterized as a good faith payment, to be returned to Mr. Balistreri if Gucci prevailed in this litigation. (Deposition of Edward Litwak dated Dec. 23, 2008, attached as Exh. R to Maltbie Decl., at 144). The money was transferred on September 21, 2007. (Tr. at 63). Indeed, on November 8, 2007, Mr. Balistreri wrote to Mr. Litwak noting that he had previously wired “good faith funds totaling $10,000” and purportedly enclosing an additional $5,000.[2] (Def.Exh.A).[3] According to Mr. Balistreri, Edward Litwak & Associates had “agreed to license the world-wide rights to the Jennifer Gucci name and logo to Joe Balistreri & Associates (“JBA”) ... for product categories including water, flavored water, and any new type of water that is popularized during the contract period” as well as other food products. (Def.Exh. A). He further stated that the good faith payments were to be applied to the cost of the license, which was a one-time payment of $22,500. (Def.Exh.A). Finally, Mr. Balistreri indicated his understanding that the agreement was contingent: It should be noted if the pending litigation between Gucci America, Inc. and Edward Litwak, et al, is not resolved to the satisfaction of JBA, all good faith funds paid to date of $15,000, will be returned to [sic] within three (3) days of the court's decision. If no court decision is rendered within ninety (90) days of today's date, JBA retains the right to request and receive all good faith funds received by Edward Litwak and Associates. (Def.Exh. A). Mr. Litwak characterizes the $10,000 payment as a loan of sorts: [Mr. Balistreri] provided me with ten thousand dollars, and I signed a note with him saying that 1 would pay this money back, I owe it, if we win the case we would apply it to the contract, and if we lost the case I owe him the money, so to me it's a loan. (Tr. at 38).[4] Nevertheless, Mr. Litwak acknowledged that if he were to prevail in this litigation, Mr. Balestreri would have a license. (Tr. at 68). There was unfortunate fallout from the activities surrounding the putative water license. Mr. Balistreri designed packaging for the product, and one of his designs turned up on a website designated “Jennifer GUCCI International, Inc.” (Balistreri Dep. at 29-30, 48-49; Pl. Exh. 2). However, Gucci concedes that creating designs for a future product would not violate the TRO (Tr. at 24-25), and there is no evidence that Mr. Litwak is responsible for the website or played any role in placing the bottle design on it. *4 Mr. Balistreri also drafted a business plan for a proposed company called Inno-Tek in which he asserted that on September 3, 2007, Mr. Litwak had granted Inno-Tek a license to use the Jennifer Gucci name on bottled water and other products. (Inno-Tek Business Plan, attached as part of Exh. O to Declaration of John Maltbie dated Jan. 19, 2009 (“Maltbie Reply Decl.”), at LITWAK0247; Balistreri Decl. at 29-32). Mr. Balistreri sent a copy of the plan to Mr. Litwak on October 2, 2007, but Mr. Litwak asserts that he did not read the section concerning trademarks. (Tr. at 72-73). In any event, Mr. Balisteri has testified that Inno-Tek did not in fact own any Jennifer Gucci license, although, were he ultimately to conclude the agreement with Mr. Litwak, he would transfer the license to Inno-Tek. (Balistreri Decl. at 29-30). The licensing agreement with Mr. Litwak, however, was subject to the contingency discussed above. The most that can be said of the muddled negotiations, then, is that they gave rise to a license agreement that was subject to a condition precedent, the condition being that Mr. Litwak prevail in this case. A condition precedent is an act or event, other than a lapse of time, which, unless the condition is excused, must occur before a duty to perform a promise in the agreement arises. Most conditions precedent describe acts or events which must occur before a party is obliged to perform a promise pursuant to an existing contract, a situation to be distinguished conceptually from a condition precedent to the formation of the contract itself. In the latter situation, no contract arises unless and until the condition occurs. Oppenheimer & Co. v. Oppenheim, Appel, Dixon & Co., 86 N.Y.2d 685, 690, 636 N.Y.S.2d 734, 737 (1995) (internal quotation marks and citations omitted). As one prominent treatise observes, “where the parties to a proposed contract have agreed that the contract is not to be effective or binding until certain conditions are performed or occur, no binding contract will arise until the conditions specified have occurred or been performed.” 13 Williston on Contracts § 38:7 (4th ed.). The terms of the TRO are clear: they forbid licensing of the Jennifer Gucci name. However, it was understood that the agreement between Mr. Litwak and Mr. Balistreri would not be effective unless and until the current litigation was successfully concluded. Thus, because the proposed water license is subject to a condition precedent that has not yet occurred, it is not a binding contract. This determination does not depend on crediting Mr. Litwak's testimony; indeed, as discussed below, he is far from credible. However, there is simply insufficient affirmative evidence that a license was consummated. Consequently, the contingent arrangement that was made did not constitute a violation of the TRO. B. Notice of the TRO By contrast, Mr. Litwak has violated the TRO by failing to provide a copy of it to all entities with which he had entered into a licensing agreement for use of the Jennifer Gucci name. Since there was no binding water agreement, Mr. Litwak was not technically obligated to notify Mr. Balistreri of the TRO. However, Mr. Litwak admits that he had a licensing agreement with a company called Proportion Fit and that he failed to send that entity a copy of the TRO. (Tr. at 60). While Mr. Litwak attests that he notified Proportion Fit and others of the existence of the TRO by referring them to the Court's website (Tr. at 59-60), the TRO plainly requires more. Accordingly, within five days of the date of this order, Mr. Litwak shall provide a copy of the TRO by overnight courier to any person or entity with whom he has entered into a license agreement for use of the Jennifer Gucci name, and, within one business day thereafter shall provide a list of the recipients to Gucci. To the extent that he fails to abide by this obligation, Mr. Litwak shall be liable for contempt sanctions in the amount of $1,000 per day for each day that he is out of compliance.[5] C. Discovery Default *5 In a document request dated July 30, 2007 and directed to Mr. Litwak, Gucci sought, among other things, “All Documents and Communications from January 1, 1990 to the Present concerning any existing or prospective contracts, licenses, sub-licenses, or other agreements concerning the manufacture, promotion, marketing and/or distribution of any product bearing the name Jennifer Gucci and/or containing one or more of the Jennifer Gucci Marks.” (Pl. Exh. 1 at 11, ¶ 7). Pursuant to the TRO, Mr. Litwak was required to respond to this request within seven days of the date of entry of that order and to produce responsive documents five days thereafter. (TRO at 2, ¶¶ 1, 2). And, indeed, at his deposition on September 17, 2007, Mr. Litwak represented that he had complied: Q Number 7, “All documents and communications from January 1, 1990 to the present concerning any existing prospective contracts, licenses,” et cetera, relating to the Jennifer Gucci name. Have you provided all such documents- A Yes. Q -that you have? Not just the licenses themselves, but all documents relating to them. A Anything related that I had, you have. (Deposition of Edward Litwak dated Sept. 17, 2007 (“Litwak 9/17/07 Dep.”), attached as Exh. C to Letter of Louis S. Ederer dated Feb. 4, 2009, at 225-26). In fact, a significant number of highly relevant documents were not disclosed. In response to a discovery motion by Gucci, I issued an Order dated August 14, 2008, requiring, among other things, a forensic examination of Mr. Litwak's computer. As a consequence of that examination as well as discovery of non-parties, Gucci unearthed numerous additional documents, including those related to the water license negotiations between Mr. Litwak and Mr. Balistreri. Although, as discussed above, no binding contract was effected, these communications clearly related to a “prospective license” and so came within the TRO's requirements for disclosure. Similarly, an e-mail to Mr. Litwak from a Robert Nabasny belatedly came to light. In that communication, Mr. Nabasny indicates that Mr. Litwak has granted him a license for a line of Jennifer Gucci intimate apparel. (E-mail dated March 29, 2007, attached as Exh. B to Maltbie Reply Decl.; Tr. at 82-83). Again, though Mr. Litwak insists that no license agreement was actually entered into (Tr. at 83-84), production of the e-mail was nevertheless required by the TRO. Mr. Litwak has offered a variety of excuses for failing to comply with the discovery requirements of the TRO. In part, he contends that he did not realize that he had a continuing obligation to produce documents once the initial production was made. (Tr. at 48). He also maintains that he provided all documentation to his prior counsel and is unaware of what counsel then forwarded to Gucci's attorneys. (Tr. at 81-82). Finally, he blames his failure to produce electronically-stored documents on his ignorance of computers, and he asserts that it was necessary to enlist his wife's assistance to search his computer files. (Tr. at 46-47). *6 None of these explanations withstands scrutiny. Because Gucci persistently sought additional documentation from Mr. Litwak, he could not have failed to understand the continuing nature of his discovery obligations. Although it is conceivable that Mr. Litwak gave his former attorney more documents than were ultimately produced, he has failed to identify with specificity even one such document. Similarly, Mr. Litwak's claims of computer illiteracy are entirely conclusory. He has never explained what searches he and his wife did conduct, what files were opened, and why the forensic examination uncovered numerous documents that he had been unable to locate. Finally, there is compelling evidence that Mr. Litwak was not candid during the discovery process. Despite the fact that counsel for Gucci asked Mr. Litwak about licensing agreements during the September 17, 2007 deposition and confirmed that Mr. Litwak had produced all documents about prospective licensing arrangements, Mr. Litwak failed to mention his discussions with Mr. Balistreri, even though he had sent Mr. Balistreri a draft contract in June and sent him an e-mail referencing that contract just two days after the deposition. (Tr. at 52-55). Mr. Litwak's explanation that he “forgot” about the prospective water license while he was being deposed is simply not credible. (Tr. at 54). Indeed, Mr. Litwak's lack of credibility is evident in his business dealings. In an e-mail to a potential investor on July 1, 2007, Mr. Litwak said, Here is a copy of the Gucci Coffee plan. We plan to take the company public at sometime [sic]. We have raised the initial $2 million needed and because of your continued support in PCAP I am willing to offer you 1% of my ownership in the coffee deal for $15,000. (E-mail string attached as Exh. D to Maltbie Reply Decl.). Yet, when asked at deposition whether he had, in fact, raised the initial $2 million, Mr. Litwak responded, “No. That was just a sales pitch to have them come in the company.” (Deposition of Edward Litwak dated Dec. 23, 2008, attached as Exh. E to Maltbie Reply Decl., at 104). Likewise, in June 2007, when Mr. Litwak was negotiating a water license with Mr. Balistreri, he had just conveyed to Veratex a right of first refusal with respect to the use of the Jennifer Gucci name on any products. (Litwak 9/17/07 Dep. at 193). Given Mr. Litwak's record of dissembling, I am not inclined to accept at face value his innocent explanations for discovery defaults. The injury created by Mr. Litwak's failure to meet his discovery obligations under the TRO is the expense incurred by Gucci in pursuing that discovery by alternate means. Gucci is therefore entitled to an award of the attorneys' fees and costs attributable to the additional discovery it has undertaken and the motion practice in which it has been forced to engage. It is most efficient, however, to defer a final determination of the amount of the award until this case is decided on the merits. It may well be that the Court will find that this is an exceptional case, such that the defendants will be liable to Gucci for its fees under the Lanham Act. See 15 U.S.C. § 1117(a); Gucci America, Inc. v. Rebecca Gold Enterprises, Inc., 802 F.Supp. 1048, 1050-51 (S.D.N.Y.1992). In that event, it would be unnecessary to allocate attorney time between that devoted to extraordinary discovery efforts and that attributable to other tasks. Therefore, Gucci need not submit any fee application until the conclusion of the case.[6] Conclusion *7 For the reasons set forth above, I find that Mr. Litwak violated the terms of the TRO by failing to provide a copy of it to persons with whom he has entered into licensing agreements and by failing to produce discovery materials as required. Accordingly, Mr. Litwak shall be liable for contempt sanctions in the amount of $1,000 per day for each day that he fails to comply with the notice requirement of the TRO pursuant to the timetable set forth above. Furthermore, he shall be liable to Gucci for the attorneys' fees and costs incurred in connection with discovery necessitated by his failure to abide by the TRO's discovery provisions. Gucci may submit the appropriate fee application at the conclusion of the case. SO ORDERED. Footnotes [1] “Tr.” refers to the transcript of the contempt hearing. [2] Mr. Balistreri and Mr. Litwak agree that the additional $5,000 was, in fact, never transmitted. (Balistreri Dep. at 36; Tr. at 68). [3] Unless otherwise indicated, exhibit designations refer to evidence received during the contempt hearing. [4] Mr. Litwak's ability to return the “good faith” payment promptly is open to question; he used some of it to pay his attorney and sent the rest to Jennifer Gucci to help her pay her mortgage. (Tr. at 66-67). [5] Because the sanction here is coercive in nature and is intended to protect Gucci's rights, it is a civil contempt remedy. To the extent that the parties, by submitting the stipulated TRO for my approval, consented to my exercising authority under 28 U.S.C. § 636(c), then I have the power to issue an order of contempt for violation of the TRO. 28 U.S.C. § 636(e)(4). Insofar as any question may be raised concerning my authority to impose contempt sanctions directly, this portion of the Memorandum and Order should be construed as my certification of contempt to the District Judge pursuant to 28 U.S.C. § 636(e)(6)(B)(iii). [6] A court is authorized to impose discovery sanctions, including the assessment of attorneys' fees, for the failure to comply with a discovery order, independent of any finding of contempt. Fed.R.Civ.P. 37(b)(2)(C).