In re the Marriage of: Nader Charles Kazeminy, Petitioner Below,

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2018).

STATE OF MINNESOTA
IN COURT OF APPEALS
A18-0029

In re the Marriage of:
Nader Charles Kazeminy,
Petitioner Below,

vs.

Jibil Eftehar Kazeminy,
Respondent,
NJK Holding Corporation, et al.,
Appellants.

Filed February 19, 2019
Affirmed
Florey, Judge

Hennepin County District Court
File No. 27-FA-12-7936

William R. Skolnick, Skolnick & Joyce, P.A., Minneapolis, Minnesota; and

Richard K. Walker, Walker & Peskind, P.L.L.C., Scottsdale, Arizona (for respondent)

Christopher W. Madel, Jennifer M. Robbins, Cassandra B. Merrick , Madel P.A.,
Minneapolis, Minnesota (for appellants)

Considered and decided by Reilly , Presiding Judge; Schellhas, Judge; and Florey,
Judge.

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U N P U B L I S H E D O P I N I O N
FLOREY, Judge
Appellants NJK Holding Corpora tion and Nasser Kazeminy challeng e the district
court’s contempt order and its award of attorney fees. We affirm.
FACTS
This contempt dispute arises from a contentious dissolution of marriage between
respondent Jibil Eftekhar Kazemi ny (respondent-wife) and Nader Kazeminy (husband).
Husband is the son of one of th e appellants, Nasser Kazeminy. Nasser Kazeminy is the
owner and Chairman of NJK Holding Corporation (NJK), and husband has been employed
by NJK as its Chief Executive Officer (CEO) since 1992.
Husband is named as the sole direct beneficiary of two trusts ( the 1992 and 1999
trusts) created by his parents as spendthrift trusts. As stated in the district court’s contempt
order: whether the assets held in the trusts are considered mar ital property subject to
distribution “has been the most hotly contested issue in this case since its inception.”
Husband and respondent-wife married in 1995 and had two children together, both
of whom have reached the age of majority. In October 2012, hus band filed a petition for
dissolution. Following respondent-wife’s first discovery request concerning the 1992 and
1999 trusts, husband moved the district court for summary judgm ent determining that the
trusts were not subject to distribution in the parties’ dissolu tion and for an order denying
discovery into the amount or nature of the trust assets. In the fall of 2013, the district court
appointed an expert to determine whether the trust assets were part of the marital estate.

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In the spring of 2014, the court-appointed expert released a re port concluding that
the trusts were not marital property. As such, the district co urt granted husband’s
summary-judgment motion. The court also granted husband’s requ est for a partial
judgment and decree dissolving the parties’ marriage and reserv ing issues concerning
parenting and financial matters for trial.
In January 2016, the first portion of husband and respondent-wi fe’s divorce trial
began. At trial, respondent-wife sought access to the unredact ed documents used by the
expert to create the 2014 report. On January 29, 2016, the district court ordered the release
to counsel of the unredacted doc uments, subject to a protective order limiting
dissemination. Husband and appellants immediately filed motions asking the court to stay
its order.1
On February 9, 2016, the district court found that the informat ion provided to the
expert was contradicted by live testimony at trial, and ordered , again, that the unredacted
supporting documents related to the 2014 report be released to counsel. On February 11,
2016, husband petitioned this court for writs of prohibition and mandamus to preclude the
district court from reconsidering prior rulings, and to undo th e release of the unredacted
documents. Appellants filed a similar petition. This court de nied both petitions. In re

1 On Saturday, January 30, 2016, appellants’ counsel sought an e mergency writ of
prohibition and a stay of the district court’s January 29 order . See Minn. R. Civ. App. P.
121.01 (seeking emergency writs). Over the same weekend, appel lants’ counsel also
contacted the district court, requesting that it stay the order pending review by this court.
On February 1, 2016, the district court temporarily granted hus band’s request to stay the
January 29 order. The district court denied appellants’ reques t for a stay, but granted
appellants’ request to file a motion. On February 2, 2016, appellants’ counsel filed a notice
of motion and motion to stay the district court’s January 29 order.

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Nader Charles Kazeminy, No. A16-0245 (Minn. App. Mar. 15, 2016) (order); In re Nasser
Kazeminy, et al. , No. A16-0246 (Minn. App. Mar. 15, 2016) (order). In June 201 6, the
district court vacated the summary judgment granted to husband, and it granted respondent-
wife’s discovery request concerni ng the two trusts. About one month later, the district
court issued a second discovery order concerning the same matter.
Throughout the summer of 2016, p rocess servers hired by respond ent-wife
repeatedly attempted to serve subpoenas on appellants. At leas t a dozen service attempts
were avoided or refused over the course of ten days in July. After being told on August 1
that NJK officers were out of the country all week, process servers successfully completed
service on NJK officers, including Nasser Kazeminy, just one day later, on August 2, 2016.
In September 2016, the district court ordered appellants, for t h e t h i r d t i m e , t o
produce financial documents concerning the 1992 and 1999 trusts. Specifically, the court
ordered that:
NJK must provide responsive financial statements, tax returns,
forecasts and projections, and shareholder/member control
agreements for any assets held by the 1992 or 1999 Trusts
where the entities in question are not publicly traded.

In October 2016, appellants made available over 57,000 pages of documents for
r e v i e w a t N J K ’ s o f f i c e s . H o w e v e r , a s N J K ’ s C h i e f F i n a n c i a l O f ficer (CFO), Rhonda
Donahue, revealed in her deposition in November 2016, tax returns for entities held by the
two trusts were not included in the disclosed documents. In the two weeks following Ms.
Donahue’s deposition, NJK produced an additional 10,000 pages of documents for review.

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With trial set to resume in mid-December, a pretrial conference was held in late
November 2016. At the conference, appellants’ counsel represen ted to the district court
that counsel believed that NJK had produced everything required by the discovery orders.
Following the conference, however, NJK produced an additional 5,800 pages of responsive
documents. The trial was continued.
On March 6, 2017, husband and respondent-wife’s divorce trial resumed. Much of
the testimony concerned the spe ndthrift trusts. At trial, NJK’ s CFO, Ms. Donahue,
acknowledged that late production of the additional 10,000 pages of documents had caused
the trial to be delayed. Testimony by NJK employees, including that of husband and of
Nasser Kazeminy himself, suggested that appellants had intentio nally withheld certain
discovery. For example, husband testified, that if he had complied with the court order and
produced documents that respondent-wife was seeking, he would have been fired. Nasser
Kazeminy testified:
I’m not going to give nobody anything. And I said our rule, our
policy in holding company from inception, if you go ahead
share any of the personal information of our family, our life,
you’re fired. Everybody in the company knows.

The trial concluded on March 10, 2017.

In August 2017, respondent-wife filed a motion requesting that the district court
hold appellants in contempt. Res pondent-wife alleged that appe llants had committed
constructive contempt by violating the court’s three separate discovery orders. As a result
of appellants’ alleged contempt, respondent-wife requested that the court order appellants
to indemnify her for $233,406.50 in attorney fees. Husband also filed a contempt motion,

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asking the court to find respondent-wife in constructive civil contempt for failing to comply
with a court order directing her to produce family photos and videos for copying.
On September 5, 2017, a hearing was held on husband and respond ent-wife’s
contempt motions. Husband was personally present and represent ed by counsel,
respondent-wife was personally pr esent and represented by couns el, and appellants’
attorney was also present and appearing on their behalf. The district court found both NJK
and respondent-wife in contempt. With regard to NJK, the court found:
By refusing to produce responsive documents and evading
service of process, NJK disobeyed this Court’s orders
regarding discovery, and the Court finds NJK in constructive
contempt of the Court. This contempt was prejudicial to
[respondent-wife’s] right to di scovery ordered by the Court
because it limited her ability to effectively depose witnesses
and develop her theories of the case.

The district court further found that respondent-wife’s indemni fication request of
$233,406.50 in attorney fees was “excessive,” but an award of $ 89,612.50 was “more
reasonable.” The court explaine d that it “limited its calculat ion to those billing activities
actually caused by the contempt (e.g., visiting NJK’s offices t o facilitate service of
process)” and “excluded activitie s carried out in the normal co urse of trial preparations
(e.g., conducting depositions).” The court ordered “NJK or Nasser, as Chairman and sole
shareholder” to “pay [respondent-wife] $89,612.50 as indemnification for attorney’s fees
i n c u r r e d a s a r e s u l t o f N J K ’ s c o n t e m p t o f t h e C o u r t ’ s d i s c o v e r y orders.” This appeal
followed.

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D E C I S I O N
I. The district court did not abuse its discretion in finding NJK in contempt.
Appellants argue that the distri ct court abused its discretion in finding them in
contempt, and request that this court reverse and vacate the district court’s contempt order.
Appellants argue that the district court abused its discretion because (1) the contempt order
improperly held Nasser Kazeminy personally liable; (2) the relief granted by the order was
punitive in nature and moot; and (3) the award of attorney fees was unreasonable.
“When reviewing a contempt order, the appellate court may reverse or modify only
if it finds the [district] court abused its discretion.” Time-Share Sys., Inc. v. Schmidt, 397
N.W.2d 438, 441 (Minn. App. 1986); see also Mower Cty. Human Servs. v. Swancutt, 551
N.W.2d 219, 222 (Minn. 1996). The district court’s factual fin dings in a contempt order
are reversed only if they are clearly erroneous. Swancutt, 551 N.W.2d at 222.
In Minnesota, the law of contempt has been organized into two classifications based
on the purpose of the court’s order: (1) criminal contempt with a punitive purpose, and
(2) civil contempt with a remedial purpose. State v. Tatum, 556 N.W.2d 541, 544 (Minn.
1996); Hopp v. Hopp , 156 N.W.2d 212, 216 (Minn. 1968). Criminal contempt
“vindicat[es] the court’s authority” whereas civil contempt “vi ndicat[es] the rights of a
party.” Tatum, 556 N.W.2d at 544.
Contempts of court are further broken down into two types: direct and constructive.
Id. Pursuant to Minn. Stat. § 588.01, subd. 2 (2018):
Direct contempts are those occurring in the immediate
view and presence of the court, and arise from one or more of
the following acts:

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(1) disorderly, contemptuous, or insolent behavior toward
the judge while holding court, tending to interrupt the
due course of a trial or other judicial proceedings;
(2) a breach of the peace, boisterous conduct, or violent
disturbance, tending to inte rrupt the business of the
court.

Direct contempts may be punished summarily. Minn. Stat. § 588.03 (2018).
Constructive contempts, on the other hand, are “not committed i n the immediate
presence of the court.” Minn. Stat. § 588.01, subd. 3 (2018). They may arise from a
number of enumerated acts or omissions, including, “disobedience of any lawful judgment,
order, or process of the court,” “disobedience of a subpoena du ly served,” or “any other
unlawful interference with the process or proceedings of a cour t.” Minn. Stat. § 588.01,
subd. 3(3), (7), (8). Constructive contempts may not be punished summarily, and the type
of procedural safeguards afforded to an accused depends on whet her the purpose of the
order is punitive or remedial. Tatum, 556 N.W.2d at 545 n.3.
A. The district court’s order prope rly found NJK in constructive c ivil
contempt.

Appellants argue that Nasser Kaze miny “cannot be held personall y liable” for
contempt, in part, because he was not personally present at the contempt hearing.
In Hopp v. Hopp, the supreme court identified requirements that the district c ourt
must satisfy prior to exercising its “civil contempt power[].” 156 N.W.2d at 216. Among
those, is the requirement that, “ upon due notice[,] a hearing b e conducted and at such
hearing the party charged with n onperformance be given an oppor tunity to show
compliance or his reasons for failure.” Id.

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In Westgor v. Grimm, we reiterated that a court “does not have authority to adjudge
a person guilty of constructive ci vil contempt unless the perso n has first appeared before
the court, voluntarily or involuntarily, and been examined.” 3 81 N.W.2d 877, 879-80
(Minn. App. 1986). We held that, even though the contemnor’s counsel was present at the
motion hearing, because the contemnor himself “was not brought before the court, . . . was
not personally examined, and did not submit affidavits admitting any violations of the trial
court’s orders, . . . [i]t was erro r for the trial court to hol d [him] in contempt without
securing his presence.” Id. at 880. We did, however, affirm t he district court’s award of
attorney fees, pursuant to Minn. Stat. § 588.11.2
Contrary to appellants’ understanding, the district court’s ord er, on its face, found
NJK in contempt, not Nasser Kaze miny. The district court expre ssly found that “ NJK’s
conduct, including evasion of service and failure to produce re sponsive documents in a
timely manner, defied the Court’ s orders for discovery.” (Empha sis added.) NJK had
notice of respondent-wife’s intent to move the district court for a contempt order, and, on
September 5, 2017, NJK was present at the contempt hearing, by and through its attorney.

2 We affirmed the award of attorney fees, concluding that it was “based on affidavits of
[the aggrieved party’s] attorney, which support[ed] the reasonableness of the award.” Id.
at 880. We explained:

We affirm the award of these fees despite our holding reversing
the judgment of contempt. A trial court may award attorney’s
fees incurred in prosecuting a contempt proceeding prior to the
actual finding of contempt if t he alleged contemnor fails to
appear at the hearing without justification.

Id. at 880 n.2.

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See Nicollet Restoration, Inc. v. Turnham, 486 N.W.2d 753 (Minn. 1992) (“[A] corporation
may appear only by attorney.”).
And, at the contempt hearing, NJK was afforded the required “opportunity to show
compliance [with the court’s orders] or [its] reasons for failu re.” See Hopp, 156 N.W.2d
at 216. Indeed, at the hearing, NJK’s counsel made specific factual representations to the
court on behalf of NJK:
I know of no document at NJK or Nasser Kazeminy’s
that’s responsive to any court order that has not been produced.
I know of nothing. And if you want me to be sworn in, I would
hope that my affirmation right there is enough. My license is
pretty important to me.

Further, NJK’s counsel, who repr esents both appellants in the m atter, made no
objection at the contempt hearing to proceeding without the phy sical presence of Nasser
Kazeminy.
3

3 Notably, the contempt proceeding in Westgor was initiated by a court-issued order to
show cause, whereas the contempt proceeding in the present matt er was initiated by
respondent-wife’s notice of motion and motion. See Minn. R. Gen. Prac. 309.01
(“Contempt proceedings shall be i nitiated by notice of motion a nd motion or by an order
to show cause.”). The distinction between the two means of ini tiating a contempt
proceeding is important because an order to show cause subjects the alleged contemnor to
the potential issuance of an arrest warrant and confinement for noncompliance. Thus, the
primary purpose of securing physical presence in a proceeding initiated by an order to show
cause is to provide the alleged contemnor—whose liberty is at s take—the opportunity to
be heard. See Minn. R. Gen. Prac. 309.01 advisory comm. cmt. (“Service of the order to
show cause upon the person provides jurisdiction for the issuan ce of a writ of attachment
or bench warrant, if necessary, and meets the requirement for n otice of an opportunity to
be heard.”). On the other hand, a party’s motion for contempt neither compels an alleged
contemnor to personally attend the hearing on the motion, nor d oes it authorize
confinement for noncompliance. Consequently, had the district court found Nasser
Kazeminy in contempt, in addition to or instead of NJK, our decision to affirm would not
necessarily change because there is no indication that he was at risk of confinement.

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B. The contempt order was not punitive in nature.
Appellants contend that the contempt order was punitive because the purpose of the
order was to punish for past conduct, rather than to induce future performance. Appellants
argue that, if the order was, indeed, for civil contempt, then (1) the order should have
included “purge conditions”—conditions that “allow the obligor[s] to purge [themselves]
of contempt” and (2) the appellants were entitled to a second hearing to determine whether
the purge conditions had been met . For support, appellants cit e to Minn. State Bar Ass’n
v. Divorce Assistance Ass’n, Inc., 248 N.W.2d 733 (Minn. 1976), and Mahady v. Mahady,
448 N.W.2d 888 (Minn. App. 1989). Their arguments are not persuasive.
In Minn. State Bar Ass’n , the supreme court held that a contempt order, which
imposed “a flat 30-day sentence,” and gave no indication that the contemnor “could purge
himself by complying with the [court’s] orders,” was “clearly one for criminal contempt.”
248 N.W.2d at 741. The court e xplained that a civil-contempt s anction “is inflicted
primarily as inducement for future complianc e with the order a nd in vindication of the
opposing party’s rights.” Id. It declared that “the purpose behind a civil contempt citation
is coercive” because “such a citation affords the contemnor the keys to his jail cell in that
the sentence is conditioned upon his continued noncompliance with the court order.” Id.;
see also Mahady, 448 N.W.2d at 890 (“[C]ivil contempt is said to give the cont emnor the
keys to the jail cell, because com pliance with the order allows him to purge himself and
end the sanction.”).
In Mahady, we affirmed the district court’s finding of contempt, but hel d that the
court erred by directing that a warrant be issued and the conte mnor be confined upon a

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showing that the contemnor had not purged the contempt, because confinement requires “a
specific finding that appellant [was] able to meet those conditions,” but failed to do so. 448
N.W.2d at 891-92. We, therefore, remanded in part, for a “seco nd stage hearing.” Id.
Unlike the appellant in Mahady, appellants in the present matter were not subject to arrest
and confinement, and they did not claim inability to comply wit h the discovery orders.
Accordingly, a second-stage hearing has no application here.
Pursuant to Minnesota’s indemnific ation statute, Minn. Stat. § 588.11 (2018), the
district court properly ordered appellants to indemnify respond ent-wife for the costs she
incurred as a result of the contempt.4 Minn. Stat. § 588.11 provides that if the contemnor’s
conduct was prejudicial to the opponent’s rights, the court “may order the person guilty of
the contempt to pay the party aggrieved a sum of money sufficient to indemnify the party
and satisfy the party’s costs and expenses.”
The purpose of the district court’ s contempt order was not to v indicate the court’s
authority by punishing NJK for past misconduct. Rather, it was to vindicate the rights of
respondent-wife by “making her whole” again. See Tatum, 556 N.W.2d at 544. The court
found, “[b]y refusing to produce responsive documents and evadi ng service of process,
NJK disobeyed this Court’s order s regarding discovery.” The co urt noted that NJK’s

4 Appellants argue that the application of Minn. Stat. § 588.11 is conditioned on a proper
finding of contempt, which the district court never properly found because appellants were
not afforded the procedural rights mandated under Mahady, i.e., a set of “purge conditions”
and a second-stage hearing to determine whether the conditions were met. Consequently,
appellants contend, indemnification under Minn. Stat. § 588.11 is inapplicable at this stage
in the proceedings. Because we conclude that the district cour t properly found NJK in
contempt, we reject appellants’ argument that section 588.11 does not apply.

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contempt “was prejudicial” to respondent-wife “because it limited her ability to effectively
depose witnesses and develop her theories of the case.” Pursuant to Minn. Stat. § 588.11,
the court awarded respondent-wife “$89,612.50 as indemnificatio n for attorney’s fees
incurred as a result of NJK’s contempt of the Court’s discovery o r d e r s . ” T h e c o u r t ’ s
meticulous review and significan t reduction of respondent-wife’ s requested award of
attorney fees confirms the remedial purpose of the order.5
C. The district court’s award of a ttorney fees was reasonable and
permissible.
Appellants argue that the attorn ey fees awarded to respondent-w ife were
unreasonable and an abuse of the district court’s discretion. According to appellants, “[a]
typical award of fees for a contempt order ranges in the few thousands of dollars” and “[i]t
is simply not plausible that even [the] reduced award amount is connected to the underlying
alleged contempt or was incurred in prosecuting the contempt ch arge.” This argument is
unsupported and unpersuasive.
“We will not reverse the distri ct court’s decision on attorney fees absent an abuse
of discretion.” Carlson v. SALA Architects, Inc., 732 N.W.2d 324, 331 (Minn. App. 2007),
review denied (Minn. Aug. 21, 2007). In Hanson v. Thom, we identified a three-prong test
to determine whether an award of attorney fees under section 588.11 is appropriate:
First, the fees must be based on proof of actual damages.
Second, the award must not penalize the contemnor. Finally,
the party receiving the fees must actually incur the fees.

5 Because the district court’s civil-contempt order indemnifying respondent-wife for the
attorney fees was proper and statutorily authorized, we conclude that appellants’ mootness
argument is without merit and decline to address it further.

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636 N.W.2d 591, 593 (Minn. App . 2001) (internal citations omitted). “Further, the party
that incurred the fees must be ‘aggrieved,’ and the award must indemnify the party.” Id.
(citing Minn. Stat. § 588.11).
The district court’s award to respondent-wife of $89,612.50 as indemnification for
attorney fees was reasonable and within its discretion. First, the attorney fees were based
on proof of actual damages. Res pondent-wife submitted with her contempt motion
affidavits from her attorneys and copies of their billing and time records. The district court
carefully reviewed, independently calculated, and significantly r e d u c e d t h e a m o u n t
requested, and appended its calculation of fees as an exhibit to the contempt order. See id.
at 593 (“There is little doubt that the award here was based on actual damages; the district
court made its determination based on its review of the billing records reflecting the amount
of attorney fees incurred.”).6
Second, the purpose of the award was not to penalize appellants. As stated above,
the purpose of the award was remedial, that is, to reimburse respondent-wife for costs she
incurred directly as a result of NJK’s contempt of the court’s three discovery orders. The
district court reviewed the invoices submitted by respondent-wife and, as articulated in its
contempt order, it “limited its calculation to those billing activities actually caused by the
contempt.” See Hanson , 636 N.W.2d at 593 (“The district court carefully reviewed

6 Although appellants contend that “[a] typical award of fees fo r a contempt order ranges
in the few thousands of dollars,” they fail to establish that larger awards are inappropriate
when otherwise supported by the record. See, e.g., Afremov v. Amplatz, No. A04-952, 2005
WL 89475, at *9 (Minn. App. Jan. 18, 2005) (concl uding evidence supported district
court’s award of approximately $125,000 in attorney fees).

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litigation costs and awarded only those fees incurred in bringi ng the contempt action.
There is no evidence in the record that the modest award here was a penalty.”).
Third, respondent-wife was aggrieved as a result of incurring s ignificant attorney
fees, and there is no suggestion that any other party was oblig ated to pay for that
representation. See, e.g., id. at 593-94 (concluding that “[r]e spondents have not suffered
loss or injury because their title insurance company paid their attorney fees, and they are,
therefore, not aggrieved”).
Finally, although the district c ourt did not expressly find Nas ser Kazeminy in
contempt, we nevertheless affirm the court’s award of attorney f e e s a g a i n s t h i m . See
Westgor, 381 N.W.2d at 880 (affirming district court’s award of attorney fees, pursuant to
section 588.11, despite holding that it was error for court to hold obligor in contempt
without in-person appearance). A t oral argument before this co urt, appellants’ counsel
asserted that Minnesota Rule of Civil Procedure 37, authorizing sanctions for failure to
comply with court orders, is inapplicable to nonparties. Appel lants’ counsel conceded,
however, that if appellants had been parties to the underlying divorce action, the district
court could have imposed sanctions for noncompliance under rule 37. Pursuant to binding
caselaw, we conclude that appellants have misconstrued the limitations of the rule.
In Bowman v. Bowman , we held that the district court’s award of attorney fees
against a nonparty for failure to comply with court orders was justified under rule 37. 493
N.W.2d 141, 145 (Minn. App. 1992). Bowman involved a similar fact pattern to the one
at hand: the appellant and his son were partners in a company. Id. at 143. In his son’s
divorce proceedings, the appellant was subpoenaed to testify and produce company records

16
because one of the issues was the value of the son’s interest i n the partnership. Id. After
the appellant failed to comply with the court’s orders, the dis trict court held the appellant
in conditional contempt and awarded attorney fees against him. Id. We held that, because
the court never made a final contempt finding, the award of att orney fees could not “be
considered part of the court’s contempt power.” Id. Nevertheless, we affirmed the award
under rules 37.01 and 37.02. Id. at 145. In response to the appellant’s argument that rule
37.02 did not apply to him because he was a nonparty, we explained:
While we recognize appellant is a nonparty, he was
brought into this litigation as a result of his role as a partner in
the Bowman Construction Company. Because appellant was
an officer in the partnership, the trial court was authorized t o
issue a “just” order in regard to his failure to produce the
required documents, including an award of attorney fees.

Id. at 146.
A p p l y i n g Bowman and Westgor t o t h e p r e s e n t m a t t e r , w e c o n c l u d e t h e d i s t r i c t
court’s award of attorney fees against Nasser Kazeminy did not require a finding of
contempt. Consequently, we affirm the award obligating either NJK or Nasser Kazeminy
to pay respondent-wife $89,612.50.
Affirmed.