Professional Documents
Culture Documents
Knickerbocker v. Corinthian Colleges - 298 F.R.D. 670
Knickerbocker v. Corinthian Colleges - 298 F.R.D. 670
| Neutral
Core Terms
emails, backup, tapes, documents, Plaintiffs, sanctions,
discovery, deleted, parties, retrieve, days, bad faith,
termination, notice, servers, employees, declaration,
searched, deadline, inherent power, spoliation, Fears, fine,
stipulated order, attorneys, spoliation of evidence, oral
argument, Verification, electronic, destroyed
Counsel: [**1] For Meghann Knickerbocker, Lisa Holland,
Janet OConnell, Plaintiffs: David C Martin, Margaret Pak
Enslow, LEAD ATTORNEYS, ENSLOW MARTIN PLLC,
SEATTLE, WA; Lisa A Burke, LEAD ATTORNEY,
HEYRICH KALISH MCGUIGAN PLLC, SEATTLE, WA;
Dan Kalish, HKM EMPLOYMENT ATTORNEYS PLLC,
SEATTLE, WA.
For Corinthian Colleges Inc, a Delaware Corporation, doing
business as Everest College Inc, Defendant: Alejandro G
Ruiz, Jeffrey K Brown, LEAD ATTORNEYS, PRO HAC
VICES, PAYNE & FEARS, IRVINE, CA; Ralph Crockett
Pond, AIKEN ST LOUIS & SILJEG, SEATTLE, WA.
Judges: JAMES L. ROBART, United States District Judge.
Opinion by: JAMES L. ROBART
Opinion
[*672] ORDER AWARDING SANCTIONS
I. INTRODUCTION
Before the court are Plaintiffs first and second motions for
sanctions against Defendant Corinthian Colleges, Inc.
(Corinthian). (1st Mot. (Dkt. # 37); 2d Mot. (Dkt. # 63).)
Plaintiffs argue that Corinthians failure to preserve and
subsequent delay in producing evidence merits sanctions.
(See id.) Having considered the submissions of the parties,
the balance of the record, and the relevant law, and having
heard oral argument and received supplemental briefing, the
court GRANTS Plaintiffs motions.
II. BACKGROUND
Corinthian runs for-profit colleges throughout [**2] the
United States and Canada. (1st Mot. at 2.) Plaintiffs Janet
OConnell, Lisa Holland, and Meghann Knickerbocker,
former employees of Corinthian, filed this action against
Corinthian for racial discrimination, harassment, and
retaliation in violation of Title VII of the 1964 Civil Rights
Act, 42 U.S.C. 2000e et seq., and Washington state law.
(See 2d Am. Compl. (Dkt. # 29).) Plaintiffs allege that they
were subjected to racially hostile work environments and
discrimination at the hands of Corinthian employees,
including Sheila Austin, Lisa Cook, Jenna Rygol, and
Meredyth Givens. (Id.) Plaintiffs allege that this
discrimination culminated in termination of their respective
employments in late April, 2012. (Id.)
Corinthian received Notices of Charge of Discrimination
from the Equal Employment Opportunity Commission
(EEOC) for Ms. Holland and Ms. Knickerbocker shortly
after their termination in early May, 2012. (Hainley Decl.
(Dkt. # 39-11) 4, 6, 7.) Corinthian received a demand
letter from Plaintiffs on May 29, 2012. (Demand Let. (Dkt.
# 39-2)). Corinthians legal department contacted outside
counsel, Payne & Fears LLP (Payne and Fears); Mr.
Alejandro Ruiz of Payne & Fears [**3] began handling the
matter in June 2012. (See Ruiz Decl. (Dkt. # 39-1) 7.)
Plaintiffs filed this action on July 3, 2012. (Compl. (Dkt. #
1).)
In January, 2013, Plaintiffs counsel expressed concern
about Corinthians meager document production; multiple
Page 2 of 10
298 F.R.D. 670, *672; 2014 U.S. Dist. LEXIS 48488, **3
discovery conferences and correspondence between
Plaintiffs counsel and Mr. Ruiz followed.1 (See Burke
Decl. (Dkt. # 21).) In April or May, 2013, Mr. Ruiz
represented that Plaintiffs work email accounts were deleted
shortly after Plaintiffs termination. (Martin Decl. (Dkt. #
38) 17; Burke Decl. 17.) When questioned about backup
sources, Mr. Ruiz represented that the information could
not be extracted without shutting down the servers; in other
words, it was not extractable. (Burke Decl. 17; see also
Ruiz Decl. 17.) This representation would later prove to be
inaccurate. (See Brown Decl. (Dkt. # 72) 3, 8 (discussing
emails retrieved from the backup tapes).)
Plaintiffs filed a motion to compel responses to certain
discovery requests. (Dkt. # 20.) To resolve this motion, the
parties stipulated to an order that the court signed on June 3,
2013. (Stip. Order (Dkt. # 24).) Mr. Ruiz, on behalf of
Corinthian, and Ms. Margaret Enslow, on behalf of the
Plaintiffs, jointly drafted this order. (12/12/13 Trans. (Dkt. #
62) at 22.) This stipulated order required that, among other
things:
Defendant, at its own expense, shall conduct a full and
complete search for all documents responsive to
Plaintiffs Requests for Production Nos. 1, 2, 3, 4, 5,
and [*673] 27, and such search shall include documents
on backup servers.
(Stip. Order at 3.) Corinthian only produced about 100
pages of additional documents in response to this order.
(Martin Decl. 18.) On July 1, 2013, Defendant filed a
Verification of Compliance with Stipulation and Order
Compelling Further Discovery which verified that:
Corinthian, at its own expense, conducted a full
and complete search for all documents responsive
to Plaintiffs Requests for Production Nos. 1, 2, 3,
4, 5, and 27 (subject to any and all objections and
limitations previously agreed [**5] to by the
parties) on all available electronic sources and/or
servers . . . .
(Verification (Dkt. # 33) (emphasis added).) This verification
was incorrect in that Corinthians backup tapes were not
searched, despite the fact that Plaintiffs had not agreed that
the backup tapes were not available. (12/12/13 Trans. at
29.) The Verification was signed by Mr. Ruiz. (Id.)
Nonetheless, as discovery continued, Plaintiffs grew
increasingly concerned that Defendant had not adequately
Ms. Burkes declaration refers to Corinthians counsel as Alex Rodriguez. (Burke Decl. 8.) After reviewing the remainder of the
record, including correspondence attached to Ms. Burkes declaration, the court infers that she intended to refer to defense counsel
[**4] Mr. Alejandro Ruiz. (See, e.g., Ruiz Decl.)
Page 3 of 10
298 F.R.D. 670, *673; 2014 U.S. Dist. LEXIS 48488, **7
To support the second point, Corinthian relied on a
declaration by Andrew Ainsworth, Corporate Counsel for
Corinthian, stating that it was not possible to determine the
date each email account was deleted, and that a former
employees email account may continue to be stored for up
to 30 days before deletion occurs, but that the number of
days that elapse between the Account Termination
Notification and the accounts deletion can vary . . . .
(Ainsworth Decl. (Dkt. # 39-6) 2, 7.) However, Mr.
Ainsworths claim that [**8] employee email accounts
could be deleted anytime within 30 days of a termination
notification contradicted Mr. Banashs deposition testimony
that the accounts were deleted [*674] 30 days after the IT
Department received and implemented a termination
notification. (See Banash Dep. at 12-13.) Notwithstanding
Mr. Banashs testimony, Corinthian argued that it could not
be proven that Corinthian deleted Plaintiffs email accounts
after the duty to preserve attached. (See 1st Resp. at 11-13.)
To address the factual discrepancies advanced by the
parties, the court held oral argument and heard testimony
from Mr. Banash and Mr. Ainsworth. (12/12/13 Min. Entry
(Dkt. # 48); see generally 12/12/13 Trans.) At the hearing,
Jeffrey Brown, counsel for Corinthian, admitted that,
although Corinthian had issued litigation holds in previous
litigations, Corinthian did not issue a litigation hold with
respect to this case. (12/12/13 Trans. at 4-5.) Mr. Brown
represented that, instead of issuing a company-wide notice,
Corinthian had hand-selected certain employees and
requested that they retrieve and retain relevant documents.
(Id. at 5-7, 12, 18.)
Mr. Banash testified as to the process by which terminated
employees [**9] email accounts are automatically deleted.
(Id. at 9, 29-30.) Specifically, within 24 hours of receiving
a termination notice from the Human Resources (HR)
Department, the IT Department closes the terminated
employees email account and the account goes into a
30-day holding pattern. After 30 days the email system
itself, the exchange system, removes the box. It simply
recovers the disk space that it was taking up. (Id. at 9; see
also 29-30.) As to the timing of the deletion, Mr. Banash
confirmed: On the servers [the emails] continue to exist for
30 days. After 30 days from the closure date, the exchange
server itself simply removes the box, deletes it. (Id. at 30.)
In light of this testimony, Mr. Ainsworth admitted that his
declaration stating that Corinthian deleted terminated
Mr. Brown also explained that no other document destruction program was in place at Corinthian. (Id. at 7.) Although Plaintiffs
pointed to a Corinthian document purporting to establish a six-month automatic email deletion policy, the policy was apparently never
implemented. (See 1st Mot.) Plaintiffs claim that Mr. Ruiz represented that the reason Corinthian had produced so few emails was due
to the alleged six-month deletion policy (see, e.g., Burke Decl. 17); [**11] Corinthian disputes that Mr. Ruiz ever made such a
representation.
Page 4 of 10
298 F.R.D. 670, *675; 2014 U.S. Dist. LEXIS 48488, **10
17 (I explained that it was unreasonable and impractical to
search them because retrieval of any information from those
tapes would require dedicated servers to which the
information would need to be downloaded (sequentially)
and configured . . . .)) Because Mr. Banash had proven
unable to address this topic during his 30(b)(6)
[**12] deposition, Plaintiffs counsel possessed little other
knowledge regarding the backup tapes. (12/12/13 Trans. at
31-32; see also id at 23.)
Mr. Brown took the position that the Stipulated Orders
requirement for a full and complete search that shall
include documents on backup servers did not extend to
documents kept on backup tapes, because [t]he tape is an
entirely different ballgame from the servers. (Id. at 20,
21-22; see also id. at 21 (testimony by Mr. Banash
confirming that Corinthian has both backup tapes and
backup servers).) Plaintiffs counsel, on the other hand,
claimed that they were not aware that Corinthian intended to
draw a distinction between backup servers and backup
tapes, and that they understood the Stipulated Order to
refer generally to backup media. (Id. at 22, 24-25
(testimony by Margaret Enslow).) Similarly, with respect to
the Verification of Compliance, which affirmed that
Corinthian had searched all available electronic sources
and/or servers, Plaintiffs maintained that they had not
agreed that the backup tapes were not available. (Id. at 30
(testimony by Mr. Martin).)
Mr. Brown emphasized multiple times that accessing the
information on the [**13] backup tapes would solve the
spoliation problem facing the court. (See id. at 38 (And the
answer is lying right under our noses. We brought it up in
April. We can go get those tapes. If there is something
supposedly in Michelle Paulinos mailbox, we can look at it.
. . . We can do that. A thousand dollars a day and it is here
and we are done.); id. at 27 (THE COURT: Is it your
position, sir, that that is not an intentional deletion of
information once you are on notice of litigation? MR.
BROWN: Your Honor, number one, that is my position,
because the emails exist on the backup tapes. And we can
get them.); id. at 20 (I know those things are still there. I
can tell you, it is about a thousand dollars per day of
recovery time. It can be done. It is sitting there.))
Mr. Brown represented that the cost of retrieval would not
be as excessive as the court feared: it was possible to
recover all employee emails that predated a certain date
because the backup tapes stored nightly snapshots of the
state of the system. (See id. at 38-39.) Specifically, Mr.
Brown engaged in the following dialogue with the court:
THE COURT: You are sitting here telling me over and
over and over again, we have [**14] the backup tapes,
Page 5 of 10
298 F.R.D. 670, *676; 2014 U.S. Dist. LEXIS 48488, **16
Friday deadline. Mr. Ruiz stated that the vendor believed it
would take at least 12 more days to retrieve the data. At a
telephone conference with the parties on December 23,
2013, Mr. Brown stated that the document recovery could
be completed, at the earliest, by December 31, 2013, but
declined to commit to a firm date. (See Dkt. # 58; Enslow
Decl. (Dkt. # 64) 4.) The following day, Plaintiffs agreed
to vacate the parties January trial date. (See id.)
On January 2, 2014, Corinthian filed a status report indicating
that it could not produce the emails of four employees until
January 6, 2014, and could not produce the emails of three
other employees until January 13, 2014. (1st Status Rep.
(Dkt. # 59) at 2-3; see also Enslow Decl. 6, 7.) During a
telephone conference on January 13, 2014, Corinthians
counsel represented that Corinthian would produce emails
from all other employees by January 27, 2014.3 (Enslow
Decl. 8; Brown Decl. 8.) Corinthian missed this
deadline; the remaining emails were not produced until
February 10, 2014. (Brown Decl. 9-10; see also 2/3/14
Min. Ord. (Dkt. # 65).)
All in all, Corinthian eventually produced about 3000
additional emails from the backup tapes. (Brown Decl. 8,
11; Enslow Decl. 6, 7.) By comparison, Corinthians
original entire discovery production up to that point
encompassed only 110 email strings and 1270 pages of
other documents. (2d Resp. (Dkt. # 66) at 8 n.5 (citing Ruiz
Decl. 8-13).) Corinthian finished production of the
emails more than seven weeks after the courts original
deadline.4 (See Brown Decl. 9-10; Order Compelling
Prod. at 4.)
It cost Corinthian $7530.00 in vendor fees to recover the
emails. (See Tetzlaff Decl. (Dkt. # 70) 30, Ex. N.)
Corinthian also claims to have incurred the cost-equivalent
of approximately $11,600.00 in employee time dedicated to
restoring the backup tapes (see id. 31), but provides no
documentation to substantiate that claim.
Due to the volume of new documents produced, the court
reopened discovery and rescheduled trial at the end of the
Despite the plain language of the courts order, which required [**17] Corinthian to retrieve from the backup tapes all employee
email accounts and to search the retrieved information according to the terms articulated in the parties stipulated order, (Order
Compelling Prod. at 4 (emphasis added)), Mr. Brown argued that Corinthian was not required to produce any more emails. (Enslow Decl.
8.) Plaintiffs disagreed and Mr. Brown eventually agreed to produce the remaining emails. (Id.)
4
The recovery process proved considerably less straightforward than Mr. Brown represented at oral argument. The first vendor
Corinthian hired was unable to retrieve any information from the backup tapes. (See Burkhart Decl. (Dkt. # 68); Tetzlaff Decl. (Dkt. #
70).) [**18] The tapes were returned to Corinthian, who managed to recover and produce some emails itself. (See Tetzlaff Decl.; Banash
Decl. (Dkt. # 71).) Corinthian then hired a second vendor to complete recovery of the emails; after some delay, this vendor was able to
retrieve only a subset of the remaining emails. (See id.; Morgan Decl. (Dkt. # 69).) The tapes were once again returned to Corinthian,
who eventually recovered and produced the final subset of emails. (See Tetzlaff Decl.; Banash Decl.; Brown Decl.)
Page 6 of 10
298 F.R.D. 670, *677; 2014 U.S. Dist. LEXIS 48488, **20
faith includes a variety of types of willful actions,
including recklessness when combined with an additional
factor such as frivolousness, harassment, or an improper
purpose. Id. (quoting Fink, 239 F.3d at 994).
Although the Ninth Circuit has declined to decide the
precise standard of proof for sanctions awards, it is clear
that a bad faith finding supported by clear and convincing
evidence will suffice. See Lahiri v. Universal Music & Video
Distrib. Corp., 606 F.3d 1216, 1219 (9th Cir. 2010)
(declining to resolve burden of proof issue because clear
and convincing evidence supported the district courts bad
faith finding); In re Lehtinen 564 F.3d 1052, 1061 n.4 (9th
Cir. 2009) (same); Fink, 239 F.3d at 989 (same). Upon a
finding of bad faith, courts can levy an assortment of
sanctions under their inherent power, including monetary
[**21] awards, attorneys fees, adverse inference jury
instructions, and even dismissal of claims. Apple, Inc. v.
Samsung Elecs. Co., Ltd., 881 F. Supp. 2d 1132, 1135 (N.D.
Cal. 2012) (collecting cases); see also Chambers v. NASCO,
Inc., 501 U.S. 32, 43, 111 S. Ct. 2123, 115 L. Ed. 2d 27
(1991). Sanctions may extend to both parties and counsel.
See, e.g., Barnd v. City of Tacoma, 664 F.2d 1339, 1342 (9th
Cir. 1982) (A trial courts inherent powers unquestionably
include the power to assess attorneys fees against any
counsel who willfully abuses judicial process or otherwise
conducts litigation in bad faith.); Primus Auto. Fin. Servs.,
Inc. v. Batarse, 115 F.3d 644, 649 (9th Cir. 1997) (reviewing
district courts sanction of attorney under inherent powers);
Tuttle v. Combined Ins. Co., 222 F.R.D. 424, 432 (E.D. Cal.
2004) (imposing $5000.00 fine against attorney).
2. Spoliation of Evidence
Spoliation of evidence falls within the courts inherent
power to sanction. Glover v. BIC Corp., 6 F.3d 1318, 1329
(9th Cir. 1993) (A federal trial court has the inherent
discretionary power to make appropriate evidentiary rulings
in response to the destruction or spoliation of relevant
evidence.) Spoliation of evidence is the failure [**22] to
preserve property for anothers use as evidence, in pending
or future litigation. Kearney v. Foley & Lardner, LLP, 590
F.3d 638, 649 (9th Cir. 2009). A partys duty to preserve
evidence is triggered when a party knows or reasonably
should know that the evidence may be relevant to pending
or future litigation. E.E.O.C. v. Frys Elecs., [*678] Inc.,
874 F. Supp. 2d 1042, 1044 (W.D. Wash. 2012); see also
Leon v. IDX Sys. Corp., C03-1158 P, 2004 U.S. Dist. LEXIS
31361, 2004 WL 5571412, at *3 (W.D. Wash. Sept. 30,
2004) affd, 464 F.3d 951 (9th Cir. 2006). Once triggered,
this duty extends to any documents or tangible items that the
party knows or should know are relevant to the litigation, as
Page 7 of 10
298 F.R.D. 670, *678; 2014 U.S. Dist. LEXIS 48488, **24
& Fears have refused to participate forthrightly in the
discovery process and that this refusal constitutes or is
tantamount to bad faith. Corinthians and Corinthians
counsels discovery tactics, which are detailed [**25] in the
following paragraphs, have delayed resolution of Plaintiffs
claims, expended both the courts and Plaintiffs limited
resources on matters ancillary to the merits, and threatened
to interfere with the rightful decision of this case. Therefore,
sanctions are warranted.
To begin, there is no dispute that Corinthian did not issue a
litigation hold in this case. (See Banash Dep. at 15; 12/12/13
Trans. at 4-5 (Mr. Brown testifying).) Corinthian has issued
litigation holds in previous actions. (Id.) Nonetheless, for
this case, Corinthian only requested that a subset of
employees, whom it deemed to be key witnesses, search
for and save relevant documents. (Id. at 5-7, 12, 18; Ruiz
Dec. 7-8.) Testimony by some of these key witnesses,
however, casts doubt on Corinthians claim that these
employees in fact performed anylet alone a
thoroughsearch for relevant documents. Specifically, Ms.
Austin and Ms. Paulino testified that they did not search for
documents [*679] relevant to the litigation, and Ms. Givens
and Ms. Phillips testified that they did not recall searching
for documents.5 (See Martin Decl. Ex. E (Austin Dep.) at
3, Ex. F (Givens Dep.) at 7, Ex. I (Phillips Dep.) at 12,
[**26] Ex. J (Paulino Dep.) at 16.) Such self-selection of
a limited pool of discovery materials, combined with doubt
as to what searches, if any, were performed of this pool of
materials, gives the court no confidence in the quality of
Corinthians discovery production. Yet, due to the lack of a
litigation hold, it is not clear that the current additional
discovery period, instituted 18 months after Plaintiffs filed
suit, can remedy this deficiency.
Second, there is no dispute that Corinthian deleted Plaintiffs
email accounts, and that the deletion of at least two of the
accounts occurred after Corinthians duty to preserve
documents was triggered. Corinthian received EEOC notices
on behalf of Ms. Holland and Ms. Knickerbocker on May 4,
2012. (Hainley Decl. 6, 7.) These documents put
Corinthian on notice that Plaintiffs emails may be relevant
to potential future litigation. See Frys Elecs., 874 F. Supp.
2d at 1044. Corinthians IT Department [**27] received Ms.
Two of these employees later impeached themselves in declarations responding to Plaintiffs first motion for sanctions; these
employees claim that they now remember searching for documents. (See Austin Decl. (Dkt # 39-13); Givens Decl. (Dkt. # 39-9).)
Under Rule 26(b)(2)(B): A party need not provide discovery of electronically stored information from sources that the party
identifies as not reasonably accessible because of undue burden and cost. Fed. R. Civ. P. 26(b)(2)(B). The appropriate [**30] context
for determining the accessibility of the information on Corinthians backup tapes would have been in a motion to compel. See Fed. R.
Civ. P. 26(b)(2)(B) Advisory Committee Notes, 2006 Amendments; see also Mikron Indus., Inc. v. Hurd Windows & Doors, Inc., No.
C07-532RSL, 2008 U.S. Dist. LEXIS 35166, 2008 WL 1805727 (W.D. Wash. Apr. 21, 2008) (evaluating motion to compel under Rule
Page 8 of 10
298 F.R.D. 670, *680; 2014 U.S. Dist. LEXIS 48488, **28
litigation, adopting whatever posture is most convenient in
[**29] the immediate context. (Compare Ruiz Decl. 17 (I
explained that it was unreasonable and impractical to search
them . . . .) with 12/12/13 Trans. (It would be perfect. It
would be one day, $1,000.) (Mr. Brown testifying).)
Corinthian cannot have it both ways. If the information on
the backup tapes was unavailable within the meaning of
Federal Rule of Civil Procedure 26(b)(2)(B) such that
Corinthian was not required to recover it, then the Plaintiffs
deleted emails were, in fact, spoliated evidence. If, as
Corinthians counsel represented at oral argument, the
information on the backup tapes was accessible, then
Corinthian had little basis for refusing to search the backup
tapes under the parties Stipulated Order, no basis for filing
a verification with the court affirming that it had searched
all available electronic sources (see Verification at 3), and
appears to have assumed a misleading stance with Plaintiffs
from the beginning.
Corinthian counters that it encountered substantial technical
difficulties and costs in retrieving [**31] the emails from the
backup tapes. (See Tetzlaff Decl.) But any obstacles
Corinthian faced in recovering the emails were the direct
result of Corinthians inadequate discovery search, deletion
of evidence, and lack of candor with both Plaintiffs and with
the court. Such obstacles do not transform bad faith into
good.
Throughout the course of the litigation, Corinthian did not
once provide a straight-forward explanation of the process
and cost of extracting information from the tapes. Mr. Ruiz
originally estimated that recovery of deleted emails would
take at least three days and could cost thousands of dollars.
(Ruiz 2d. Decl. (Dkt. # 67) 6.) Yet during discovery,
Plaintiffs remained unaware that Corinthians backup system
differentiated between backup tapes and backup servers,
and that Corinthian interpreted the parties Stipulated Order
as excluding backup tapes. (12/12/13 Trans. at 22-25, 31-32
(Ms. Enslow testifying) (No, your Honor, I did not
understand the distinction between backup tapes and backup
servers, and Mr. Ruiz never offered his understanding of the
distinction of those words.) Corinthians Rule 30(b)(6)
witness did nothing to clear up the confusion, despite notice
[**32] that he was expected to testify on the topic of backup
sources. (See Banash Dep. at 9-10; 30(b)(6) Not.) As a
result, even as of the first motion for sanctions, Plaintiffs
C. Sanctions
Sanctions [**34] should be commensurate to the sanctioned
partys degree of fault and the other partys prejudice. See
26(b)(2)(B)). In such a motion, Corinthian would bear the burden to show that accessing the tape would be unduly costly, and Plaintiffs
would bear the burden to show good cause for allowing discoveryspecifically, that Plaintiffs need for the information on the backup
tapes outweighed the costs. Id. Inasmuch as (1) Corinthian dodged Plaintiffs motion to compel with an ambiguously worded and
now-contested stipulation (see Stip. Order), (2) the parties continue dispute to what extent Plaintiffs were apprised of the nature of the
backup tapes, (see 1st Reply (Dkt. # 40) at 5-6), and (3) Corinthians counsel never set forth a clear picture of the process of retrieving
information from the tapes, this option was not available to the court.
Page 9 of 10
298 F.R.D. 670, *681; 2014 U.S. Dist. LEXIS 48488, **34
Zest IP Holdings, LLC v. Implant Direct Mfg., LLC, No.
CIV. 10-0541-GPC WVG, 2013 U.S. Dist. LEXIS 169014,
2013 WL 6159177, at *7 (S.D. Cal. Nov. 25, 2013); Leon,
2004 U.S. Dist. LEXIS 31361, 2004 WL 5571412, at *5; In
re Napster, 462 F. Supp. 2d at 1066. Accordingly, although
the cost of retrieving emails from the backup tapes does not
affect the question of whether sanctions are warranted, the
court will bear the cost in mind when assessing the
appropriate level of sanctions. Plaintiffs ask for a host of
sanctions against Corinthian, only some of which are
appropriate here.
First, there is no basis for a jury instruction that Corinthian
intentionally destroyed documents that were presumably
damaging to Corinthian. (See 2d. Mot. at 11-12.) The
recovery of employee emails from the backup tapes has
likely avoided spoliation of email evidence. Because no
litigation hold was implemented, it is possible that other
documentary evidence overlooked by Corinthians initial
self-selected search may have been lost over time. However,
mere possibility cannot be the basis for an adverse jury
instruction. At this time, Plaintiffs have simply not shown a
[**35] reason to believe additional categories of documents
have been destroyed.
The court requested supplemental briefing from the parties
regarding any allegedly spoliated documentary evidence.
(See Plf. Surreply (Dkt. # 78); Def. Surreply (Dkt. # 81).)
Plaintiffs have identified certain categories of documents it
believes are missing, none of which merit an evidentiary
sanction. (See Plf. Surreply.) To begin, the handwritten
interview notes taken by Pamela Hainley and Jenna Rygol
have already been producedalbeit belatedlyby
Corinthian. (See Interview Notes (Dkt. ## 79-1, 79-2).) The
fact that the interview notes were not produced until January
13, 2014months after Ms. Hainley and Ms. Rygol
mentioned the notes in their depositions and one week after
the trial was scheduled to beginhighlights the inadequacy
of Corinthians initial search for and production of
documents. (See 3/21/14 Trans. at 26 (testimony by
Corinthian attorney Mr. Brown: Im going to do a mea
culpa on the timing. They were produced on January 13,
2014.)) But produced documents cannot form the basis for
a spoliation instruction.
Plaintiffs also speculatebut provide zero evidencethat
certain other categories of documents [**36] are missing.
Specifically, Plaintiffs argue that Corinthian never produced
hard copy documents and computer files maintained in Ms.
OConnells office, but fail to provide a declaration or other
evidence showing that these documents in fact existed. (See
Plf. Surreply; see generally Enslow Decl. II Exs. A-J (Dkt.
Page 10 of 10
298 F.R.D. 670, *682; 2014 U.S. Dist. LEXIS 48488, **38
$5000.00 fines each against attorney and party for causing
a witness to be unavailable in the hopes that sanctions will
cause counsel to evaluate their standards of professional
conduct and hopefully modify their future behavior). Here,
Corinthians bad faith discovery conduct has delayed the
parties trial date by almost one year, wasted the courts and
Plaintiffs trial preparations, required the court to engage in
numerous hearings and status conferences, resulted in more
documents being produced after the original scheduled trial
date than during discovery itself, [**39] and threatened to
interfere with the rightful decision of this case. See Kamatani v. Benq Corp., CIV.A. 2:03-CV-437, 2005 U.S. Dist.
LEXIS 42762, 2005 WL 2455825 (E.D. Tex. Oct. 6, 2005)
(imposing sanctions of $500,000.00 against party for
discovery violations). The conduct of Corinthians counsel
at Payne & Fears, namely, Mr. Brown and Mr. Ruiz, has
substantially contributed to these adverse consequences. See
R & R Sails, 251 F.R.D. at 528; Qualcomm, 2008 U.S. Dist.
LEXIS 911, 2008 WL 66932, at *12-14; Carroll v. Jaques
Admiralty Law Firm, P.C., 110 F.3d 290, 294 (5th Cir. 1997)
(affirming imposition of $7000.00 fine against attorney);
Kleiner v. First Nat. Bank of Atlanta, 751 F.2d 1193, 1209
(11th Cir. 1985) (affirming imposition of $50,000.00 fine
In assessing these sanctions, the court is mindful of the principles outlined in F.J. Hanshaw Enterprises, Inc. v. Emerald River
Development, Inc., 244 F.3d 1128, 1138 (9th Cir. 2001). The court has tailored both the sanctions imposed and the procedures followed
with the object of conforming to those [**40] teachings. Accordingly, Corinthian and its attorneys have been given multiple
opportunities to present their case to the court, including two rounds of briefing, an evidentiary hearing, and oral argument.