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Perez v. Paragon Contractors Corp.

Citations: 233 F. Supp. 3d 1234; 2016 U.S. Dist. LEXIS 189297; 2017 WL 1331967Docket: Case No. 2:06-CV-00700-TC

Court: District Court, D. Utah; December 5, 2016; Federal District Court

Narrative Opinion Summary

The case involves Defendants, Paragon Contractors Corporation and Brian Jessop, found in civil contempt for violating an injunction prohibiting child labor. The Department of Labor had previously secured an injunction against Paragon to cease child labor practices. Despite this, Paragon engaged in activities involving child labor during pecan harvests, prompting legal actions due to their deceptive practices and obstruction of investigations. The court, recognizing the Defendants' history of noncompliance and evasion, imposed sanctions including appointing a special master to oversee compliance and ordering the Defendants to pay $200,000 into a fund for compensatory claims by affected children. The Department's request for an amended injunction was denied, as the court emphasized the role of civil contempt sanctions in enforcing existing orders. Additionally, the court denied motions to stay and reconsider sanctions, citing insufficient grounds and the irrelevance of prior pecan sale proceeds. The special master is tasked with conducting inspections and ensuring adherence to the injunction, with costs borne by Defendants. This ensures oversight and compensation for child labor violations, reflecting the court's commitment to enforcing compliance and protecting vulnerable workers.

Legal Issues Addressed

Appointment of Special Master under Rule 53

Application: To ensure compliance with the injunction, a special master was appointed under Rule 53 of the Federal Rules of Civil Procedure to conduct inspections and report on compliance.

Reasoning: Additionally, the court orders the appointment of a Special Master under Rule 53 of the Federal Rules of Civil Procedure to oversee Defendants' compliance with the Injunction over five years.

Civil Contempt and Compliance Enforcement

Application: The court found the Defendants in civil contempt for violating an injunction prohibiting child labor, highlighting the necessity of sanctions to ensure compliance.

Reasoning: The court, led by Judge Tena Campbell, found the Defendants in civil contempt for violating a previous injunction prohibiting the use of child labor by Paragon Contractors Corporation.

Compensatory Sanctions for Noncompliance

Application: The court ordered Defendants to pay $200,000 to a fund for compensatory claims, reflecting losses incurred due to their noncompliance with the injunction.

Reasoning: The court mandates that Defendants compensate $200,000 into a Fund due to their violation of an Injunction, rather than for minimum-wage or overtime law violations.

Denial of Motion to Stay and Reconsider Sanctions

Application: The court denied Defendants' motions to stay and reconsider sanctions, emphasizing the insufficiency of grounds for a stay and the inappropriateness of readdressing settled issues.

Reasoning: The court has temporarily stayed its Order on Sanctions to consider the Defendants' motions, which it ultimately denies, lifting the stay.

Role of a Special Master in Compliance Monitoring

Application: The court appointed a special master to oversee compliance with labor regulations due to the Defendants' history of evasion and obstruction.

Reasoning: The court imposed sanctions, appointing a special master to oversee compliance and requiring the Defendants to pay funds to the Department of Labor to compensate affected children.