Catagory:Case Summaries

GFI Acquisition, LLC v. Am. Federated Title Corp. (In re A & M Fla. Props. II, LLC), 2010 WL 1418861 (Bankr. S.D.N.Y. Apr. 7, 2010)

Where plaintiff’s counsel “failed in his obligation to locate and produce all relevant documents in a timely manner” by failing to gain a sufficient understanding of plaintiff’s computer systems resulting in significantly delayed production of relevant documents, the court declined to impose terminating sanctions or an adverse inference but ordered monetary sanctions against plaintiff and counsel in an amount to be determined.

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Qualcomm Inc. v. Broadcom Corp., No. 05cv1958-B (BLM) (S.D. Cal. Apr. 2, 2010)

Apparently bringing an end to one of the best known e-discovery sagas since the 2006 amendments to the Federal Rules, United States Magistrate Judge Barbara Major has declined to impose sanctions against the previously sanctioned Qualcomm attorneys absent evidence of bad faith.

On January 7, 2008, Magistrate Judge Major issued an order granting in part defendant’s motion for sanctions upon finding that the plaintiff, Qualcomm, intentionally withheld thousands of documents and that six attorneys “had assisted Qualcomm in withholding the critical documents by failing to conduct a reasonable inquiry into the adequacy of Qualcomm’s document production and by ignoring warning signs, which indicated that the document search was not thorough and that Qualcomm’s documents production was not complete.”  The sanctioned attorneys objected.  Thereafter, U.S. District Court Judge Rudi Brewster determined that the sanctioned attorneys “had a right to defend themselves” and “should not be prevented from defending their conduct by the attorney-client privilege of Qualcomm and its employees and representatives.”  Finding the self-defense exception to the attorney-client privilege applicable, the court lifted the sanctions and remanded the case to the Magistrate Judge for additional consideration. A ccordingly, between March 2008 and the present, the previously sanctioned attorneys undertook significant efforts to defend their actions.  As a result of those efforts, Magistrate Judge Major has now declined to impose sanctions: 

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Adhi v. Twp. of W. Pikeland, 2010 WL 1047894 (E.D. Pa. Mar. 16, 2010)

In this zoning dispute, defendant moved to enforce a prior order of the court and, essentially, compel more complete responses to discovery, including the production of electronically stored information (“ESI”), specifically emails.  Plaintiff indicated that even if responsive emails had existed, they were deleted in the ordinary course of business.  Accepting defendant’s assertions that “the mere deletion of an email does not make it lost forever”, however, the court ordered plaintiff to allow defendant’s “e-Discovery expert” to inspect plaintiff’s computers to determine if any responsive information was still contained on the hard drives or the servers.  In so ordering, the court reasoned that this would “allow Defendant to conduct discovery on information to which it is entitled without burdening Plaintiff with the expense of hiring a discovery expert.”

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Stengart v. Loving Care Agency, Inc., 2010 WL 1189458 (N.J. Mar. 30, 2010)

In this employment litigation, the Supreme Court of New Jersey addressed whether employees have a reasonable expectation of privacy as to attorney-client privileged emails sent and received on a work computer.  The court held that under the circumstances presented, the employee/plaintiff did have a reasonable expectation of privacy as to emails with her attorney.  Additionally, the court remanded the case to the trial court to determine what, if any, sanctions should be imposed upon defense counsel for reading and utilizing the emails at issue, despite indications that they were protected as privileged.

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Gucci Amer., Inc. v. Curveal Fashion, 2010 WL 808639 (S.D.N.Y. Mar. 8, 2010)

Plaintiff sought to compel the production of documents and information regarding defendants’ Malaysian bank accounts pursuant to a subpoena served on United Overseas Bank’s New York Agency (“UOB NY”).  UOB NY was not a party to the underlying action, nor was its parent company. Despite substantial evidence that production of the requested information was prohibited by Malaysian law and that violation of the law could subject a person to civil and criminal penalties, the court concluded that compliance with the subpoena was warranted and ordered UOB NY to produce the information within two weeks.

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McVicker v. King, 2010 WL 786275 (W.D. Pa. Mar. 3, 2010)

In this suit arising from claims of unlawful and discriminatory termination, plaintiff, a former employee of the Borough, sought to compel a third-party owner of an internet discussion board to produce information sufficient to identify anonymous authors of certain, relevant posts.  Plaintiff argued the identities of the posters may be relevant to impeach defendants’ testimony regarding when the determination to terminate plaintiff was first discussed.  Citing First Amendment considerations, the court denied plaintiff’s motion to compel.

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Rimkus Consulting Group, Inc. v. Cammarata, 688 F. Supp. 2d 598 (S.D. Tex. 2010)

For intentional spoliation, the court declined to order terminating sanctions but ordered an adverse inference instruction and for defendants to pay plaintiff’s attorneys fees and costs.

In this litigation arising from accusations of misappropriation of trade secrets, violation of non-compete agreements, and related claims, plaintiff accused defendants of spoliating relevant evidence, including electronically stored information (“ESI”).  The court found that defendants had indeed participated in intentional spoliation of evidence, including failing to preserve relevant ESI, manually deleting ESI, and destroying or giving away laptops containing relevant ESI, among other things.  The court nonetheless declined to grant plaintiff’s request for terminating sanctions because plaintiff was unable to show a sufficiently high degree of resulting prejudice.  Specifically, the court found that because defendants had produced a large volume of evidence despite their spoliation of other ESI, because plaintiff had obtained some of the deleted evidence from other sources, and because evidence revealed that some of the deleted records would have been favorable to defendants, the resulting prejudice was “far from irreparable” – the necessary showing to justify terminating sanctions:  “The sanction of dismissal or default judgment is appropriate only if the spoliation or destruction of evidence resulted in “irreparable prejudice” and no lesser sanction would suffice.” [Citation omitted.]

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Lawson v. Sun Microsystems, Inc., 2009 WL 5842136 (S.D. Ind. Oct. 16, 2009);  Lawson v. Sun Microsystems, Inc., 2010 WL 503054 (S.D. Ind. Feb. 8, 2010)

Where plaintiff accessed privileged, password-protected documents in defendant’s production, “carelessly” produced poor and incomplete copies of relevant taped conversations, and intentionally lied regarding taped conversations in deposition, the magistrate judge declined to recommend dismissal but recommended monetary sanctions instead.  The amount of sanctions recommended was reduced by 25% upon the magistrate judge’s finding that plaintiff’s counsel mitigated plaintiff’s violations by ignoring plaintiff’s emails regarding the password-protected documents.  The magistrate judge also found plaintiff’s “improprieties” mitigated “by the part [the defendant] and its counsel played in creating this perfect storm of a disaster” and reduced the sanction an additional 25%.  While the magistrate judge recommended plaintiff’s counsel be ordered to pay monetary sanctions equal to a 25% reduction in plaintiff’s maximum sanction, the district court declined to adopt that recommendation.  The recommendation was otherwise adopted.

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Seger v. Ernest-Spencer, Inc., 2010 WL 378113 (D. Neb. Jan. 26, 2010)

In this personal injury case, the court found a non-party had waived its claims of privilege as to already-produced documents and granted defendant’s motion to compel their production upon finding that disclosure was “knowing and intentional” as evidenced by the non-party’s failure to establish reasonable precautions to prevent disclosure and its failure to timely assert a claim of privilege, among other things.  Rejecting claims of undue burden, the court also granted defendant’s motion to compel the non-party’s production of emails after reducing defendant’s proposed search terms to eliminate those deemed irrelevant or overly broad.

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MBIA Ins. Corp. v. Countrywide Home Loans, Inc., 895 N.Y.S.2d 643 (N.Y. Sup. Ct. 2010)

Upon defendant’s motion for a protective order to require plaintiff to bear the cost of defendant’s production of electronically stored information (“ESI”), the court declined to follow the purportedly “well settled rule” in New York that the party seeking discovery should bear the cost and denied defendant’s motion.  (See T.A. Ahern Contractors Corp. v. Dormitory Auth. of State of N.Y., 875 N.Y.S.2d 862 (N.Y. Sup. Ct. 2009) declining to overturn the “well settled” rule in New York that the party seeking discovery bears the cost.)

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