Kai Hansjurgens v. Donald H. Bailey

90 F.4th 1158
Court of Appeals for the Eleventh Circuit·Decided January 12, 2024·No. 22-10819·Published·Cited by 4 cases

Opinion

[PUBLISH]

In the

United States Court of Appeals For the Eleventh Circuit

No. 22-10819

In re: DONALD H. BAILEY Debtor.

KAI HANSJURGENS, Plaintiff-Appellant,

versus DONALD H. BAILEY,

Defendant-Appellee.

Appeal from the United States District Court for the Southern District of Georgia D.C. Docket No. 4:21-cv-00105-RSB-CLR,

USCA11 Case: 22-10819 Document: 62-1 Date Filed: 01/12/2024 Page: 2 of 22

2 Opinion of the Court 22-10819

Bkcy No. 4:07-bk-41381-EJC

Before WILLIAM PRYOR, Chief Judge, and ROSENBAUM and ABUDU, Circuit Judges. ROSENBAUM, Circuit Judge:

Baseball Hall of Famer Frank Robinson famously said that “[c]lose only counts in horseshoes and hand grenades.” 1 To that list we add one more thing: close—as long as it’s close enough to qualify as “substantial compliance”—also counts when it comes to following a state’s rules for reviving a judgment in federal court under Federal Rule of Civil Procedure 69(a).

More than a decade ago, Appellee Donald Bailey obtained a bankruptcy judgment against Appellant Kai Hansjurgens for tortious interference with contract. That judgment included punitive damages based on Hansjurgens’s “malice and intent to injure” and “cavalier attitude toward [his] duties as [a] litigant[].” Bailey v. Hako- Med USA, Inc., No. 09-4002, at 8–9 (Bankr. S.D. Ga. Apr. 7, 2011). Hansjurgens has not paid Bailey a cent.

Georgia state law gave Bailey ten years to collect. But before Bailey’s judgment expired irretrievably, Bailey filed—and the bankruptcy court granted—a motion to revive that judgment. Hansjurgens does not dispute that the underlying judgment is valid, but he

1 Nick Acocella, More Info on Frank Robinson, ESPN CLASSIC (last visited Jan. 12,

2024), https://www.espn.com/classic/000728frankrobinsonadd.html [https://perma.cc/5ATF-87HL].

22-10819 Opinion of the Court 3

still seeks to keep his streak of dodging payment intact. This time, Hansjurgens claims that Bailey didn’t strictly comply with Georgia state-law procedures to revive his judgment. But the district court found—and Bailey argues on appeal—that Bailey did enough to satisfy the Georgia judgment-revival procedure under Federal Rule of Civil Procedure 69(a). We agree. So after careful consideration, and with the benefit of oral argument, we affirm.

I. BACKGROUND

A. Original Bankruptcy Proceedings and Related Appeals

Bailey and Hansjurgens’s dispute originated with a business arrangement. Bailey leased medical equipment to physicians. To obtain some of his leasing inventory, Bailey entered into a distributorship agreement with Hansjurgens and his medical device company Hako-Med USA, Inc. Bailey v. Hako-Med USA, Inc. (In re Bailey ), 2010 Bankr. LEXIS 6300, at *2 (Bankr. S.D. Ga. 2010). Under this agreement, Bailey bought several Hako-Med PRO Elec DT 2000 and VasoPulse 2000 devices. Healthcare professionals use these machines to non-invasively treat lower back pain. Id. Unfortunately for Bailey, though, he had trouble selling the devices. In Bailey’s view, his sales problem arose because Hansjurgens and Hako-Med recommended billing codes that resulted in lower reimbursement rates than they had touted. Id. at *3–4.

After the distributorship agreement expired, a medicalequipment rental company, New River, offered to pay Bailey $1,000 each month per device to lease the devices to physicians’ offices.

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Id. at *5. But Hansjurgens and Hako-Med threatened (unfounded) legal action against physicians who were negotiating with Bailey and New River. Id. at *6. So Bailey stopped marketing the devices, and New River shut down its operations. Id. at *9.

Bailey filed for Chapter 11 bankruptcy. In bankruptcy court, Bailey brought an adversary proceeding against Hansjurgens and Hako-Med for tortious interference with contract.

The bankruptcy court held a trial and entered an interlocutory order in favor of Bailey. Id. at *27. It concluded that Hansjurgens had indeed tortiously interfered “to bully the Potential Purchasers out of negotiations” and “to advance his own pecuniary interest .” Id. at *18–19.

After finding that Hansjurgens and Hako-Med “acted with malice and intent to injure,” the bankruptcy court ordered post- judgment discovery on punitive damages and attorney’s fees. Id. at *21, *27. Bailey’s post-judgment discovery requests went “largely unanswered,” so Bailey moved to compel. Bailey, No. 09- 4002, at 2. The bankruptcy court ordered Hansjurgens and Hako- Med to submit discovery responses for the court’s inspection, but they did not do so. Id. at 2–3.

In the meantime, the bankruptcy court proceeded with its trial on punitive damages and attorney’s fees. In April 2011, the bankruptcy court entered judgment for Bailey and awarded $893,973.64 total: $277,336.13 in compensatory damages, $554,672.26 in punitive damages, and $61,965.25 in attorney’s fees. Id. at 12. In support of its ruling, the court characterized

22-10819 Opinion of the Court 5

Hansjurgens’s trial testimony as “evasive and uncooperative” and noted his “cavalier attitude toward [his] duties as [a] litigant[]” throughout the discovery process. Id. at 3, 9. And it found that Hansjurgens’s failure to produce post-judgment discovery was “intentional ” and “possibly motivated by a desire to perpetrate a fraud on the Court.” Id. at 10.

Hansjurgens repeatedly and unsuccessfully appealed. First, before the bankruptcy court entered final judgment, Hansjurgens sought to appeal the partial-liability determination to the district court. But the district court dismissed the appeal for lack of jurisdiction because Hansjurgens never obtained leave to appeal the interlocutory order. Hansjurgens v. Bailey (In re Bailey), 489 F. App’x 425, 425 (11th Cir. 2012). We affirmed. Id.

Hansjurgens then moved to reopen his appeal. The district court denied the motion. Because the bankruptcy court later issued a final judgment, we dismissed as moot Hansjurgens’s appeal of that denial. Hansjurgens v. Bailey, No. 12-12465, at 4 (11th Cir. 2013).

In his third effort on appeal, Hansjurgens appealed the final judgment to the district court. But the district court found that Hansjurgens’s notice of appeal was untimely filed, and he failed to show excusable neglect as Federal Rule of Bankruptcy Procedure 8002(c)(2) requires. Hansjurgens v. Bailey, No. CV411-202, 2012 WL 3289001, at *3 (S.D. Ga. Aug. 10, 2012). We affirmed the dismissal for lack of jurisdiction. In re Bailey, 521 F. App’x 920, 922 (11th Cir. 2013).

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Around the same time, Bailey moved the bankruptcy court to hold Hansjurgens in contempt based on his and Hako-Med’s continued failure to produce post-judgment discovery. Hansjurgens did not appear at the contempt hearing. So the bankruptcy court submitted a proposed contempt order to the district court. Bailey v. Hako-Med USA, Inc. (In re Bailey), 2011 Bankr. LEXIS 5424 (Bankr. S.D. Ga. 2011). The proposed order directed that Hansjurgens “be placed under arrest and imprisoned for his continuing noncompliance” and that Hansjurgens reimburse Bailey’s reasonable expenses incurred. Id. at *19.

The district court eventually adopted the bankruptcy court’s proposed order in its entirety, specifying that an arrest warrant would issue after 30 days if Hansjurgens did not comply with the discovery order. Bailey v. Hako-Med USA, Inc., 2014 U.S. Dist. LEXIS 119697, at *3 (S.D. Ga. 2014). The court also ordered Hansjurgens to pay Bailey’s reasonable expenses arising from the contemptible conduct, including attorney’s fees, but it left calculation of those expenses to the bankruptcy court. Id. at *3–4. Once again, Hansjurgens did not comply. But the district court never issued an arrest warrant.

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Kai Hansjurgens v. Donald H. Bailey, 90 F.4th 1158 (11th Cir. 2024).

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