Ed McMullen v. Bay Ship Management, 335 F.3d 215, 3rd Cir. (2003)

335 F.
3d 215
Ed McMULLEN, Appellant
v.
BAY SHIP MANAGEMENT, Appellee.
No. 00-3157.
United States Court of Appeals, Third Circuit.

Argued: April 22, 2003.
Filed: June 20, 2003.
Vincent S. Cimini, (Argued), Foley, Cognetti, Comerford & Cimini,

Scranton, for Appellant.
Thomas R. Daniels, (Argued), Lehahan & Dempsey, P.C., Scranton, for
Appellee.
Before: SCIRICA, Chief Judge,* AMBRO and WEIS, Circuit Judges.
OPINION OF THE COURT
WEIS, Circuit Judge.
In this diversity case, we conclude that the plaintiff's proper invocation of the
Fifth Amendment privilege against self-incrimination did not warrant dismissal
of the litigation. Because other less drastic measures were available to cope
with the failure to comply with the defendant's discovery requests, we will
reverse and remand for further proceedings.
Plaintiff filed a civil action on January 29, 1999 asserting claims for breach of
contract and unjust enrichment based on painting services he had performed on
military vessels at defendant's instance. With the consent of the parties, the
matter was assigned to a magistrate judge for trial.
On August 15, 1999, while this civil suit was still pending, an Information was
filed in the Middle District of Florida charging one of the defendant's
employees with irregularities in carrying out a contract with the United States to
service and maintain military vessels. Plaintiff was a named, but uncharged, co-
conspirator in that Information.

4
One month later, on September 17, 1999, the defendant served on plaintiff
interrogatories and request for production of documents. In a letter dated
November 11, 1999, counsel for the plaintiff advised defendant that:
With respect to the Information handed down by the Federal Grand Jury, Mr.
McMullen will obviously be asserting his Fifth Amendment privilege at the
time of his deposition. Moreover, so that there can be no question as to Mr.
McMullen's waiver of his Fifth Amendment privilege, he must also assert said
privilege in response to the outstanding discovery requests.
In response, defendant filed a motion to compel answers to the interrogatories

and a request for production. The parties filed briefs and discussed the issue as
well as possible settlement with the magistrate judge at a pretrial conference in
December 1999.
Upon receiving notification in the following month that settlement efforts had
been unavailing, the Court ruled on defendant's motion to compel. The Court
recognized that generally an order to compel compliance with discovery is a
prerequisite to the imposition of sanctions. However, the magistrate judge
concluded that in view of the plaintiff's unequivocal assertion that he would
invoke his Fifth Amendment privilege, the issuance of an order compelling
discovery would be a futile act.
Relying on Serafino v. Hasbro, 82 F.3d 515 (1st Cir.1996), the Court directed
that the case be dismissed with prejudice, noting that an examination of the
plaintiff's records might be helpful, but would be a poor proxy for his
testimony. Although both parties had suggested the alternative of staying the
case, the Court did not indicate why that procedure would not be a satisfactory
solution for the problem.
After the appeal was taken, the parties participated in an extended period of
negotiations in accordance with this Court's Appellate Mediation Program. The
criminal matter was concluded in June 2002, and on July 9, 2002, the plaintiff
advised that he was now available for an oral deposition. Defendant declined
the offer on the ground that too much time had elapsed. The case was then
placed on the regular docket for submission to this Court.
I.
10
Federal Rule of Civil Procedure 37 provides the means to be used in

sanctioning obstructive conduct in discovery matters. Generally, the Rule
requires the issuance of an order to compel and only after failure to comply
with that order should a penalty be imposed. Daval Steel Prods. v. M/V
Fakredine, 951 F.2d 1357, 1363-64 (2d Cir.1991) (judicial intervention
between a discovery request and the imposition of sanctions demonstrates the
seriousness of the dereliction, and permits judicial scrutiny of the discovery
request); see also Keefer v. Provident Life & Acc. Ins. Co., 238 F.3d 937, 940
(8th Cir.2000); Lillie v. United States, 40 F.3d 1105, 1109 (10th Cir.1994); 8A
Charles Alan Wright, Arthur R. Miller & Richard L. Marcus, FEDERAL
PRACTICE AND PROCEDURE 2282 (2d ed. Supp.2003).
11
Although the prerequisite of an order to compel is the usual rule, we agree with
the District Court that following that procedure in this case would have been a
meaningless formality. The plaintiff had clearly stated his position and the
issue had been briefed and argued before the magistrate judge at a pretrial
conference. The reasons underlying the Rule active judicial review of the
discovery dispute and recognition of the gravity of the issue had already
been satisfied. Thus, issuance of an order in this situation, indeed, would have
been an exercise in futility. See Serafino, 82 F.3d at 519.
II.
12
We come, therefore, to the sanction imposed. This Court has emphasized that
control of discovery is committed to the discretion of the trial court and we will
seldom intervene. However, the District Court's power is not without limit. In
re Orthopedic "Bone Screw" Products Liab. Litig., 132 F.3d 152, 156 (3d
Cir.1997). We have emphasized this Court's policy of favoring litigation on the
merits, rather than imposing dismissals with prejudice or a default judgment. In
Hewlett v. Davis, 844 F.2d 109, 113 (3d Cir.1988), we stated that "[t]hese must
be sanctions of last, not first, resort." See also Poulis v. State Farm Fire & Cas.
Co., 747 F.2d 863, 868 (3d Cir.1984) (setting out checklist applicable for
sanction of dismissal).
13
In Serafino, the Court of Appeals considered that in the circumstances of that

case, the trial court did not abuse its discretion in dismissing the case with
prejudice. Serafino, 82 F.3d at 519. The appellate court emphasized the
necessity of balancing the competing interests of the parties and cited, among
others, our opinion in SEC v. Graystone Nash, Inc., 25 F.3d 187 (3d Cir.1994).
Id. at 518. Curiously, despite its obvious pertinency, counsel for neither party
cited Graystone to the District Court in this case.
14
In Graystone, the defendants invoked the Fifth Amendment privilege, refusing

to answer questions during discovery depositions. 25 F.3d at 188-89. As a
sanction, the District Court precluded defendants from presenting evidence in
opposition to the plaintiff's summary judgment motion and granted judgment
for the plaintiffs. Id.
15
We recognized that the civil litigant had the right to the protection of the Fifth
Amendment, but that invoking that privilege had a prejudicial effect on the
adversary's right. Id. at 190. Sanctions, therefore, had to be tailored to provide
equitable treatment to the adversary, as well as accommodating the Fifth
Amendment rights of the party invoking the privilege. Id. at 192. "[T]he
detriment to the party asserting [the privilege] should be no more than is
necessary to prevent unfair and unnecessary prejudice to the other side." Id.
16
Here, the factual situation differs from Graystone in that the party availing
himself of the Fifth Amendment privilege is a plaintiff who chose to bring the
suit, rather than a defendant who had been summoned into court. Some
commentators have suggested that having selected the litigation process, a
plaintiff may not use the privilege to advance his cause to use it as a sword,
rather than a shield. That approach, however, has not carried the day.
17
Wehling v. Columbia Broadcasting Sys., 608 F.2d 1084, 1086 (5th Cir.1979),
held that "the Fifth Amendment would serve as a shield to any party who feared
that complying with discovery would expose him to a risk of selfincrimination." The Court stated that "[i]n most cases, a party `voluntarily'
becomes a plaintiff only because there is no other means of protecting legal
rights." Wehling, 608 F.2d at 1089 n. 10. The Court reversed the District
Court's dismissal and suggested instead a protective order staying discovery
until the statute of limitations on the criminal matter had expired. Id. at 1089.
18
A leading commentator has dismissed arguments against extending the Fifth

Amendment privilege to a plaintiff. "It is inconceivable that by exercising the
constitutional right to bring or defend an action a person waives his or her
constitutional right not to be a witness against himself or herself, and no case
has so held." 8 Charles Alan Wright, Arthur R. Miller & Richard L. Marcus,
FEDERAL PRACTICE AND PROCEDURE 2018 (2d ed.1994). See also
Mitchell v. Roma, 265 F.2d 633, 637 (3d Cir.1959) (explaining that by
instituting a suit, plaintiff does not automatically waive any privilege).
19
This case does not differ in any major respect from Graystone, and we therefore
apply it to the controversy presently before us. The general approach in both
cases should be the same. Although the privilege is available, prejudice to the
other party must be minimized and an equitable resolution adopted. Here, that
task has been greatly simplified by the conduct of the parties.
20
In his brief to the District Court, the plaintiff suggested as alternatives to

dismissal a stay of the matter or allowing an adverse inference because of his
failure to testify. The defendant moved for dismissal, but also suggested as an
alternative that the case be placed on the inactive list until plaintiff "is no
longer under the cloud of criminal prosecution."
21
Although a stay had been suggested as a satisfactory solution by both parties,

the District Court simply dismissed the case without commenting on the
parties' alternative suggestions for a disposition. Placing the case on the
inactive list would have been in harmony with the balancing test set out in
Graystone, which, rather than Serafino, is the governing precedent within this
circuit.
22
The only virtue in dismissing the case here was clearing the court's docket.
Although promptness in judicial administration is highly desirable, delay may
sometimes be necessary to the mission of doing justice. We are all too often
reminded that "justice delayed is justice denied." But, it is equally true that in
some situations "justice rushed is justice crushed."
23
As the Supreme Court has reminded us, "a myopic insistence upon
expeditiousness in the face of a justifiable request for delay can render the right
to defend with counsel an empty formality." Ungar v. Sarafite, 376 U.S. 575,
589, 84 S.Ct. 841, 11 L.Ed.2d 921 (1964). In a similar vein, we have said, "we
are not unmindful of the need for judicial eagerness to expedite cases, to fully
utilize the court's time, to reduce overcrowded calenders and to establish
finality of judgments. However, these commendable aspirations should never
be used to thwart the objectives of the blind goddess." Boughner v. Sec. of
Hlth., Educ. & Welfare, 572 F.2d 976, 978-79 (3d Cir.1978).
24
In the circumstances here, dismissal of the case was not consistent with a sound
exercise of judicial discretion.
25
Accordingly, the order of the District Court will be reversed, and the case
remanded for further proceedings consistent with this Opinion.
Notes:
Notes:
*
Judge Scirica began his term as Chief Judge on May 4, 2003

Ed McMullen v. Bay Ship Management, 335 F.3d 215, 3rd Cir. (2003)

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335 F.

United States Court of Appeals, Third Circuit.

Vincent S. Cimini, (Argued), Foley, Cognetti, Comerford & Cimini,

conspirator in that Information.

In response, defendant filed a motion to compel answers to the interrogatories

Federal Rule of Civil Procedure 37 provides the means to be used in

In Serafino, the Court of Appeals considered that in the circumstances of that

In Graystone, the defendants invoked the Fifth Amendment privilege, refusing

A leading commentator has dismissed arguments against extending the Fifth

In his brief to the District Court, the plaintiff suggested as alternatives to

Although a stay had been suggested as a satisfactory solution by both parties,

Judge Scirica began his term as Chief Judge on May 4, 2003

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