Sanctions Warranted for Failure to Comply with Court’s Production Order and Failure to Implement Litigation Hold

Bd. of Regents of Univ. of Neb. v. BASF Corp., 2007 WL 3342423 (D. Neb. Nov. 5, 2007)

In this patent and licensing litigation, the court had previously ordered plaintiff to produce “development documents” related to the project at issue in the litigation.  According to defendant, plaintiff produced 1,737 pages of documents by the order’s deadline in February 2006, but then later produced more than 11,000 pages of new responsive documents in the final days of discovery in the fall of 2007.  Defendant argued that these late-produced documents fell squarely within the ambit of the court’s order and should have been produced 18 months earlier.  Defendant also argued that plaintiff had failed to meet its preservation obligations.

At his deposition, one of the key players employed by plaintiff testified that he was not specifically directed by plaintiff’s counsel to search for electronically stored documents; he was asked to produce “all documents” related to his research, and he produced only hard copy documents without examining his electronic files.  In addition, the witness stated that during 2005 the University changed the storage system for the archiving of electronically produced information, from a University-wide archiving system to a more localized, “individual computer” storage system.  As part of that process the witness reviewed his computer-stored information and preserved what he deemed was important.  Conversely, of course, and without guidance, he deleted what he viewed as unimportant.  He testified that, in that process, neither the University nor counsel directed that electronically stored information pertaining to the relevant project be preserved in any form.  Further, the University’s computer system was such that some emails would be automatically deleted “at some point” if not preserved.

The court concluded that, although protesting that its noncompliance was not “willful,” plaintiff’s failure to comply with the court’s prior discovery order was established. However, the court found that the extent of that failure was not established, since it was unclear how many of the late-produced documents were actually covered by the court’s order. The court also found that plaintiff’s counsel were “far from diligent” in complying with the court’s order directing the production of the subject documents:

When faced with responding to a request for the production of documents, counsel are required to direct the conduct of a thorough search for responsive documents with due diligence and ensure all responsive documents under the “custody or control” of the client, unless protected from discovery, are produced.

Of course, when ordered by a court to produce documents, counsel are under an even higher obligation to affirmatively direct complete compliance with the order in objective good faith.  That standard was not met in this case.  There is no evidence of any specific directives from counsel to the Board regarding what was required to ensure that all documents covered by the order were produced.  The months-later production of covered documents reveals the inadequacy of simply “inform[ing] the University” of the existence of the order and “coordinat[ing]” the production of documents.  There is also no evidence of any assurances requested or given, sworn or otherwise, by University personnel to counsel to the effect that all covered documents had, in fact, been produced in accordance with the order.  There is also no evidence of any directives given by counsel at any time for a “litigation hold” to be placed on all possibly relevant documents and electronically stored information in any way connected to the dicamba resistance project to preserve them.

Accordingly, the court imposed sanctions that were “remedial in nature, aimed at resolving the compliance issue and restoring some confidence in the discovery process so this case can be resolved on all the evidence.”  The court’s sanctions included the following:

1.  Plaintiff shall search all of the files, including electronic files, of all of its current employees who participated in the dicamba resistance project and shall produce forthwith any and all documents found which are covered by the court’s order; plaintiff shall also search all records in the University’s document or data storage or archive system, including electronically stored information and files received from present and former employees who participated in the dicamba resistance project, and shall produce any and all documents found which are covered by the court’s order.  In the event that reading or obtaining access to electronically stored information, including previously deleted electronically stored information, requires the work of a computer forensic analyst to access such information on the University’s or any employee’s computers, plaintiff shall contract with such an analyst at its expense to ensure that all electronically stored information is searched for documents covered by the court’s order.

2.  The University’s employee responsible for overseeing the above search shall certify under oath that plaintiff has complied with this order, stating in full the actions taken and by whom, and the number and nature of the documents covered by the order which have been found and produced.  The certification shall be filed pursuant to the extant protective order.

3.  Plaintiff shall immediately impose a litigation hold on all possibly relevant documents in its or its employees’ possession or control and shall preserve all such documents, including exempting them from any document destruction or data deletion system or policy.

4.  Each of plaintiff’s named counsel shall file an affidavit setting forth all of the actions he has taken in respect to ensuring compliance with this order.  Such affidavits may be filed under seal, that is, accessible by only the court, if they reveal privileged information or protected work product.

5.  Plaintiff shall re-produce Drs. Weeks and Herman for deposition by counsel for BASF and Syngenta after the aforementioned search and production have been completed.  Such re-depositions shall be limited to seven hours total deposition time per deponent, split between BASF and Syngenta.  All expenses of such re-depositions, including attorneys fees for one attorney each for BASF and Syngenta for the time period consumed by the depositions, necessary travel expenses for one attorney each for BASF and Syngenta, necessary travel expenses for the deponents, and court reporter fees, shall be borne by plaintiff.  Counsel shall confer to schedule such depositions as expeditiously and least expensively as practicable.

6.  Plaintiff shall pay BASF’s and Syngenta’s reasonable expenses, including attorneys’ fees incurred in the filing of these motions.

7.  Except as otherwise agreed by counsel, all deadlines in the current progression schedule of the case are suspended until further order.  Scheduling matters will be addressed following the resolution of remaining discovery motions.  Counsel shall confer in respect to scheduling and, on or before December 3, 2007, propose to the court their scheduling suggestions.