United States District Court, D. Delaware
Vehicle Interface Technologies, LLC ("VIT") sued
Defendant Jaguar Land Rover North America, LLC
("Jaguar") for patent infringement. (D.I.
Ultimately, the court granted summary judgment in favor of
Jaguar and against VIT. (D.I. 115). In addition, the court
declared the case exceptional under 35 U.S.C. § 285 and
awarded Jaguar $2, 010, 398 in attorneys' fees and costs
(the "Fee Award"). (D.I. 149, D.I. 175). Both of
these decisions were affirmed on appeal. (D.I. 168, D.I.
189). Over a year later, VIT has still not satisfied the Fee
Award. (D.I. 191 at 2). As a result, Jaguar now moves,
pursuant to Fed.R.Civ.P. 69(a)(1), to enforce the Fee Award
under a veil piercing theory against VIT's only two
owners, non-parties Daniel Mitry and Timothy Salmon. (D.I.
190, D.I. 191). Because Jaguar has not shown that the state
of Delaware provides a procedure for enforcing a judgment
against a non-party under a veil piercing theory, the court
denies the motion as procedurally improper.
Civ. P. 69(a)(1) empowers federal courts to enforce money
judgments in supplementary proceedings in accordance with the
"procedure of the state where the court is
located." Fed.R.Civ.P. 69(a)(1); see also
Comcast of III. Xv. Multi-Vision Elec, Inc., 504
F.Supp.2d 740, 747 (D. Neb. 2007) (stating that, under Rule
69, "a federal district court has [the] same authority
to aid judgment creditors in supplementary proceedings as
that which is provided to state courts under local
law"). Because this court is located in Delaware, it may
only rely on the procedures provided by the state of
Delaware. Jaguar claims, but has not shown, that Delaware
provides a procedure for enforcing judgments after the fact
on non-parties under a veil piercing theory (sometime also
called an alter-ego theory). (D.I. 204 at 3, D.I. 191 at 11).
Jaguar cited several cases where a court employed a veil
piercing theory on a Rule 69 motion, but not a single one of
those cases relied on a Delaware procedure. See Sys.
Div., Inc. v. Teknek Elec, Ltd., 253 Fed.Appx. 31, 34
(Fed. Cir. 2007) (affirming district court's decision to
add new parties to the judgment under Rule 69 because
"California Code of Civil Procedure § 187 allows
amendment of the patent infringement judgment to add a
non-party judgment debtor"); Cordius Trust v.
Kummerfeld, 153 Fed.Appx. 761, 762 (2d Cir. 2005)
(affirming use of veil piercing on a Rule 69 motion because
New York Civil Practice Law and Rules § 5225(b) allows
veil piercing actions to be initiated as supplementary
special proceedings rather than plenary actions); In re
Levander, 180 F.3d 1114, 1120-21 (9th Cir. 1999)
(affirming district court's use of an alter ego theory to
add a new judgment-debtor under Rule 69 "[b]ecause
California law allows amendment of a judgment to add a
judgment-debtor"); Am. Federated Title Corp. v. GFI
Mgmt. Serv., Inc., 39 F.Supp.3d 516, 522 (S.D.N.Y. 2014)
(stating that veil-piercing claims are appropriate under Rule
69(a) because N.Y.C.P.L.R. § 5225(b)-which is a part of
the New York procedural rules to which Rule 69(a) instructs
New York federal courts to look-allows veil piercing "as
a means of holding a corporation's owners liable for
prior judgments against their corporation");
Comcast, 504 F.Supp.2d 740, 747 (D. Neb. 2007)
(using equitable powers to pierce the veil on a Rule 69
motion because Neb. Rev. Stat. § 25-1564 "provides
a means whereby a creditor can call upon the equitable powers
of the court to enforce the satisfaction of judgments");
Flip Side Prod., Inc. v. Jam Prod., Ltd., 125 F.R.D.
144, 145 (N.D. 111. 1989) (stating that a motion to enforce a
judgment pursuant to 111. Rev. Stat. ch. 110, ¶ 2-1402
needs to be brought under Rule 69, not Rule 60). Because
these cases do not rely on a Delaware procedure, they do not
help Jaguar's motion.
Rather, these cases illustrate the deficiency in Jaguar's
motion. Each of these cases relied on a procedure-codified in
a state rule or state statute-that gave the courts of that
state authority to grant the type of relief Jaguar seeks
here. For example, 111. Rev. Stat. ch. 110,
¶ 2-1402 states, in relevant part, "A judgment
creditor ... is entitled to prosecute supplementary
proceedings for the purposes of examining the judgment debtor
or any other person to discover assets or income of the
debtor not exempt from the enforcement of the judgment, ...
and of compelling the application of non-exempt assets or
income discovered toward the payment of the amount due under
the judgment." Neb. Rev. Stat. § 25-1564 states,
"Where a judgment debtor has not personal or real
property subject to levy on execution, sufficient to satisfy
the judgment, any interest which he may have ... in
possession of any person, body politic or corporate, shall be
subject to the payment of such judgment by proceedings in
equity, or as in this chapter prescribed." N.Y.C.L.R.
§ 5225(b) states, "Upon a special proceeding
commenced by the judgment creditor, against a person in
possession or custody of money or other personal property in
which the judgment debtor has an interest ..., where it is
shown that the judgment debtor is entitled to the possession
of such property or that the judgment creditor's rights
to the property are superior to those of the transferee, the
court shall require such person to pay the money."
Finally, Cal. Civil Proc. Code § 187 states: "When
jurisdiction is, by the constitution or this code, or by any
other statute, conferred on a Court or judicial officer, all
the means necessary to carry it into effect are also given;
and in the exercise of this jurisdiction ... any suitable
process or mode of proceeding may be adopted which may appear
most conformable to the spirit of this code." According
to California, amending the judgment to add additional
judgment debtors based on an alter-ego theory is "an
equitable procedure, " over which Section 187 gives
California trial courts jurisdiction. McClellan v.
Northridge Park Townhome Owners Ass 'n, Inc., 107
Cal.Rptr.2d 702, 705 (Cal.Ct.App. 2001). Jaguar did not cite
any similar rule or statute from Delaware.
Instead, Jaguar cited several Delaware cases that are inapt.
In those cases, plaintiffs were not attempting to enforce a
judgment against a non-party, but asserting a veil piercing
theory against a defendant who was a party to the proceeding
from the beginning. See Soroof Trading Dev. Co., Ltd. v.
GE Fuel Cell Sys., LLC, 842 F.Supp.2d 502, 521-22
(S.D.N.Y. 2012) (deciding on a motion for summary judgment
and cross-motion for judgment on the pleadings whether
defendants are liable under a veil piercing theory);
Blair v. Infineon Tech. AG, 720 F.Supp.2d 462, 473
(D. Del. 2010) (deciding on a motion to dismiss pursuant to
Fed.R.Civ.P. 12(b)(6) whether plaintiffs stated a claim
against defendants under an alter ego theory of liability);
Geyer v. Ingersoll Publ'ns Co., 621 A.2d 784,
794 (Del. Ch. 1992) (same); United States v. Golden
Acres, Inc., 702 F.Supp. 1097, 1101 (D. Del. 1988)
(stating that the first amended complaint alleged that the
Capano defendants should be liable under an alter ego theory
for any breach of contract by the Golden Acres defendant);
Gadsden v. Home Preservation Co., 2004 WL 485468, at
*1 (Del. Ch. Feb. 20, 2004) (holding a trial on the merits to
determine whether the defendant can be held liable under a
veil piercing theory). Accordingly, these cases do not
demonstrate that Delaware provides a procedure for amending a
judgment to attach a non-party under a veil piercing theory.
December 6, 2017, the court gave Jaguar an opportunity to
address the absence of citation to a relevant Delaware
authority in its motion by issuing an oral order that asked
Jaguar to identify "any Delaware statute or rule of
court that authorizes a Delaware court to enforce a judgment
against a non-party on a veil-piercing or alter ego
theory." (D.I. 220). Jaguar responded by citing Del. Ch.
Ct. R. 71, which states in relevant part: "[W]hen
obedience to an order may be lawfully enforced against a
person who is not a party, that person is liable to the same
process for enforcing obedience to the order as if that
person were a party." (D.I. 221). According to Jaguar,
there are only two cases applying Del. Ch. Ct. R. 71, and
both are inapplicable to the present motion, because they
address civil contempt. (See Id. (citing In re
Mobileactive Media, LLC, 2017 Del. Ch. LEXIS 602, at *2
(Del. Ch. Jan. 19, 2017); In re Tyson Foods, Inc.,
919 A.2d 563 (Del. Ch. 2007)). As a result, Jaguar asks the
court to construe Del. Ch. Ct. R. 71 in the same manner that
federal courts purportedly construe Fed.R.Civ.P. 71. (D.I.
several reasons, the court declines Jaguar's request.
First, it is not automatic that Delaware and federal rules,
even with the exact same language, will be interpreted the
same. See, e.g., Cede & Co. v. Technicolor,
Inc., 542 A.2d 1182, 1191 n. 11 (Del. 1988)
("Decisions interpreting the Federal Rules of Civil
Procedure are usually of great persuasive weight in the
construction of parallel Delaware rules; however, such
decisions are not actually binding upon Delaware
courts." (citations omitted)). Second, Jaguar has not
shown that federal courts use Fed.R.Civ.P. 71 to enforce a
judgment against a non-party based on a veil piercing theory.
Jaguar does not cite a single case where this
occurred. Third, "decisions interpreting Rule
71 have ... indicated that the rule's reach is
limited." DBD Credit Funding LLC v. Silicon Lab.,
Inc., 2017 WL 4150344, at *7 (N.D. Cal. Sept. 19, 2017);
see also In re Emp 't Discrimination Litig. Against
State of Ala., 213 F.R.D. 592, 599 (M.D. Ala. 2003)
(stating that the history of Equity Rule 11, the predecessor
to Rule 71, demonstrates that the rule was not intended to
"permit broad process against non-parties").
Finally, "when enforcing a judgment against non-parties,
Rule 71 is explicitly restricted to circumstances where
enforcement does not violate due process or is otherwise
lawful." 12B Charles A. Wright, et al., Federal Practice
and Procedure 1047 (Apr. 2017). Mitry and Salmon have raised
due process arguments. (D.I. 196 at 2-3). Taking all of this
together, the court does not see a clear path to finding that
the state of Delaware provides a procedure under Del. Ch. Ct.
R. 71 for enforcing a judgment against non-parties based on a
veil piercing theory.
foregoing reasons, Jaguar has not shown that Fed.R.Civ.P.
69(a)(1) is the proper procedural mechanism for enforcing the
Fee Award against Mitry and Salmon. Therefore, Jaguar's
Motion to Join VIT's Owners to the Judgment is denied.
(D.I. 190 in C.A. No. 12-1285, D.I. 96 in C.A. No. 14-339).
An appropriate order will be entered.
 All cites are to the docket for C .A.
No. 12-12 85.
 Fed.R.Civ.P. 69(a)(1) states in its
entirety: "A money judgment is enforced by a writ of
execution, unless the court directs otherwise. The procedure
on execution-and in proceedings supplementary to and in aid
of judgment or execution-must accord with the procedure of
the state where the court is located, ...