dmarcian, Inc. v. Millen — Fourth Circuit Vacates Contempt Bar on Attorney in Cross-Border IP Dispute

Background

Dmarcian, Inc. is a North Carolina-based cybersecurity company specializing in DMARC email authentication services. After a business relationship with its European partner DMARC Advisor BV (formerly Dmarcian Europe BV, a Dutch entity) collapsed, dmarcian filed suit in the Western District of North Carolina in March 2021, asserting claims for copyright infringement, trademark infringement, misappropriation of trade secrets, and state law violations.

Months later, DMARC Advisor BV filed a parallel lawsuit in Rotterdam, Netherlands. When dmarcian sought a stay of the Dutch proceedings, dBV’s attorneys — including Dutch counsel Alfred Meijboom and U.S. co-counsel Pressly Millen, a partner at Womble Bond Dickinson — submitted arguments and an affidavit to the Dutch court characterizing the two proceedings as distinct. The North Carolina district court later found those representations to be “significant and material misrepresentations” and, in June 2023, issued a correction order directing dBV’s counsel to file a statement with the Dutch court setting the record straight.

Meijboom submitted the correction order itself to the Dutch court but did not file the required corrective statement — and continued to argue the wrong position before the Dutch tribunal. Millen also failed to file the corrective statement. Despite this, the Dutch court eventually reversed course and, in December 2023, stayed the Dutch case, agreeing with the North Carolina court’s conclusions on timing and overlap. In December 2024, the district court held both dBV (fined $400,000) and Millen (temporarily barred from practicing before the Western District of North Carolina) in civil contempt. Millen — not a party to the underlying litigation — appealed immediately.

The Court’s Holding

The Fourth Circuit vacated the civil contempt adjudication against Millen on two grounds.

Jurisdiction. The court first addressed whether it could hear the appeal before final judgment in the underlying case. Because civil contempt orders are generally interlocutory, parties to the underlying action typically must wait for a final judgment to appeal. But Millen is not a party — he is a non-party attorney — and the Fourth Circuit reaffirmed that civil contempt orders entered solely against non-parties are immediately appealable as final adjudications of those persons’ rights. The court distinguished its prior decision in In re Bestwall, LLC, which involved joint-and-several sanctions against parties and their counsel, because here Millen’s sanction was entirely separate from dBV’s monetary sanction.

Merits. Civil contempt requires clear and convincing evidence of four elements, including that the respondent’s noncompliance caused the movant harm. Here, the district court imposed the practice bar without any such evidence. Dmarcian argued that Millen’s failure to file the corrective statement caused delay and increased legal costs. The Fourth Circuit rejected that argument: dmarcian presented no evidence that Millen’s submission specifically would have changed the Dutch court’s trajectory, particularly because Meijboom had independently decided to continue pressing the wrong position. The correction order itself — submitted to the Dutch court without the separate corrective statement — was enough to eventually persuade the Dutch court to grant the stay. The practice-bar sanction, the court held, was “overtly punitive” rather than remedial, falling outside the proper scope of civil contempt authority.

Key Takeaways

• Harm is an independent element of civil contempt. A movant must show by clear and convincing evidence that it suffered actual harm from the specific respondent’s noncompliance. Generalized arguments that noncompliance was bad, or that compliance might have led to a better outcome, are insufficient.
• Non-party attorneys can appeal contempt orders immediately. When a court holds an attorney who is not a party to the underlying case in contempt, that attorney does not have to wait for final judgment to appeal. The order constitutes a final adjudication of that attorney’s rights as to that discrete issue.
• Sanctions must be remedial, not punitive. Civil contempt sanctions are limited to (1) coercing future compliance or (2) compensating the injured party for actual losses. A sanction that punishes past conduct without evidence of harm to the movant exceeds the court’s contempt authority.
• Multiple actors in parallel litigation complicate contempt analysis. Where the noncompliance of a third party (here, Dutch counsel Meijboom) substantially drove the harm alleged, courts must disentangle each contemnor’s individual causal contribution.

Why It Matters

International IP litigation — where a dispute spawns parallel proceedings in multiple countries simultaneously — is increasingly common as IP-holding companies and their licensees operate globally. This case is a reminder that U.S. district courts have real power to compel parties to present accurate information to foreign courts, but that power has limits. Sanctions must be calibrated to the individual contemnor’s actual contribution to any harm, and courts cannot substitute “overtly punitive” measures for evidence of injury.

For practitioners managing cross-border IP disputes, the opinion also offers a practical takeaway on appellate jurisdiction: non-party attorneys sanctioned for contempt have an immediate right of appeal — they do not need to wait for a final judgment in the merits litigation before seeking review of a potentially career-affecting sanction.

A companion Fourth Circuit opinion issued the same day — dmarcian, Inc. v. DMARC Advisor BV, No. 23-1790 — addressed the preliminary injunction and contempt order against dBV itself and has been separately summarized on LexSummary.