Butler Innovative Solutions, Inc.

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLUMBIA
In re
BUTLER INNOVATIVE SOLUTIONS,
INC.,
Debtor.
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Case No. 08-00065
(Chapter 7)
Not for Publication in
West’s Bankruptcy Reporter
MEMORANDUM DECISION RE IMPOSITION OF CIVIL CONTEMPT SANCTIONS
On July 10, 2008, the court entered an order holding the
debtor’s principals, Keith Barkley and John Butler, in civil
contempt based upon their failure to comply with court orders,
including a directive that Mr. Barkley and Mr. Butler file
various documents on behalf of the debtor, Butler Innovative
Solutions, Inc. (Docket Entry No. 64). 	That order further
provided for coercive contempt sanctions as follows:
that commencing on Tuesday, July 15, 2008, John A.
Butler and Keith H. Barkley, jointly and severally,
shall be liable for a coercive fine of $100 per day for
each day after July 14, 2008, that the obligations
imposed upon them by the Order Designating Officers as
Debtor, Compelling the Debtor and Designated Officers
to File Documents, and Striking Earlier Entered Order,
entered May 1, 2008 (Docket No. 27), remain unfulfilled
. . . .
Mr. Barkley and Mr. Butler failed to comply with this
The document below is hereby signed. Dated:
September 29, 2008.
_____________________________
S. Martin Teel, Jr.
United States Bankruptcy Judge
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court’s July 10, 2008 contempt order. 	Accordingly, the coercive
contempt sanction of $100.00 per day began to accrue against
Barkley and Butler on July 15, 2008, and bench warrants were
ultimately issued for their arrest.
Mr. Barkley was apprehended by the U.S. Marshal on or about
September 3, 2008, in the State of Delaware, and Mr. Butler was
apprehended on or about September 5, 2008, in the State of
Pennsylvania. 	Upon learning that Mr. Barkley and Mr. Butler had
been apprehended, and having learned that they were both being
released subject to certain conditions, this court set a further
hearing for September 23, 2008, at which time the court would
determine if Mr. Barkley and Mr. Butler had purged themselves of
contempt.
Following the apprehension and release of Mr. Barkley and
Mr. Butler, various papers were filed that reflect what appears
to be a good faith effort on the part of Barkley and Butler to
purge themselves of contempt in advance of the September 23, 2008
hearing. 	It was not until their apprehension by the U.S.
Marshal, however, that Barkley and Butler began in earnest to
purge themselves of contempt. 	In calculating the amount of the
coercive contempt sanction to be imposed on Barkley and Butler
pursuant to the court’s July 10, 2008 contempt order, the court
thus deems it appropriate to treat September 2, 2008, as the last
day on which such sanctions continued to accrue. 	Accordingly,
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1 	The court imposed this civil coercive contempt sanction
on Barkley and Butler as representatives of the debtor, and it is
thus appropriate to impute the fine to the debtor as well. 	The
United States Attorney is advised that, should there be a surplus
in this case, the Treasury may look to the debtor to collect on
any unpaid portion of the $2,000.00 fine imposed upon Barkley and
Butler.
3
under the terms of the contempt order, Butler and Barkley are
subject to a coercive contempt sanction of a $100.00 per day for
a period of fifty days, or a total fine of $5,000.00. 1
“Civil contempt is a remedial device intended to achieve
full compliance with a court’s order.” 	Pigford v. Veneman, 307
F. Supp.2d 51, 56 (D.D.C. 2004). 	When fashioning a civil
contempt sanction that is coercive in nature, this court “has
broad discretion to design a remedy that will bring about
compliance.” 	Perfect Fit Industries, Inc. v. Acme Quilting Co.,
673 F.2d 53, 57 (2d Cir.), cert. denied, 459 U.S. 832 (1982). 	It
remains unclear why Barkley and Butler failed to make any attempt
to purge themselves of contempt or to communicate with this court
until after they were apprehended by the U.S. Marshal. 	It was
revealed at the September 23, 2008 hearing, however, that many if
not all of the debtor’s records were taken into possession by the
Department of Transportation pursuant to a warrant that was
executed on January 8, 2008. 	Thus, although Barkley and Butler
should have promptly advised the court of any legitimate reason
why they were unable to comply with orders of this court, it
appears that there was at least some basis for Barkley and
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2 	At the September 23, 2008 hearing, the court suggested
that, under the terms of the contempt order, Barkley and Butler
were each individually liable for separate fines accruing at the
rate of $100.00 per day. 	Upon closer examination of the July 10,
2008 contempt order, however, I conclude that, under the terms of
the order, Barkley and Butler were to be held jointly and
severally liable for one fine that accrued in the amount of
$100.00 per day. 	Thus, taking into account the court’s reduction
of the fine from $5,000.00 to $2,000.00, the total combined
amount of the coercive contempt sanction to be paid to the
Treasury by Barkley and Butler is $2,000.00.
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Butler’s failure to file schedules and a statement of financial
affairs on behalf of the debtor. 	The fact nevertheless remains
that Barkley and Butler failed to appear at hearings before this
court, and the court was unable to secure any cooperation from
either Barkley or Butler until bench warrants were issued and
executed upon. 	Taking all of these circumstances into account,
and in the exercise of its discretion, the court deems it
appropriate to leave the civil contempt sanction in place, but to
reduce the amount of the total fine from $5,000.00 to $2,000.00. 2
The court, within the exercise of its discretion, has
substantially reduced the amount of the coercive contempt
sanction imposed upon Mr. Barkley and Mr. Butler. 	Should there
be a future need to impose civil coercive contempt sanctions to
compel compliance on the part of Barkley and Butler, however, the
court will not be inclined towards leniency.
A judgment follows.
[Signed and dated above.]
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5	O:\TEEL\Laura\ORDERS\Contempt\Mem Decision_coercive sanctions_Butler.wpd
Copies to: Debtor; Debtor’s attorney; Chapter 7 Trustee; Office
of United States Trustee; Office of the United States Attorney;
Kim Mann;
John A. Butler
4705 Alcon Drive
Temple Hills, MD 20748
Keith H. Barkley
104 Bohemian Drive
Middletown, DE 19709-9282
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