Opinion
05 Civ. 5568 (RCC) (HBP).
February 22, 2007
OPINION AND ORDER
I. Introduction
By notice of motion dated July 28, 2006, plaintiff moves for sanctions pursuant to Rule 37(b)(2) of the Federal Rules of Civil Procedure for defendant's failure to comply with discovery orders in a timely manner. For the reasons stated below, I direct that defendant pay plaintiff the amount of $1,000.00 to compensate plaintiff for unnecessary legal fees. In all other respects, plaintiff's motion is denied.
II. Facts
This is a breach of contract action. Plaintiff alleges that defendant breached a contract to purchase plaintiff's law practice by failing to pay the full purchase price (Complaint (Docket Item 1), ¶ 5).
The particular discovery disputes in issue here arise from document requests, interrogatories and a notice of deposition served on defendant on or about November 14, 2005 (Declaration of Dwight Yellen, Esq. in Support of Motion for Sanctions, dated July 28, 2006 ("Yellen Decl."), ¶ 2). Initially, the parties agreed to complete depositions by January 30, 2006, and all discovery by March 9, 2006 (Yellen Decl., Ex. A).
Plaintiff's counsel wrote to me on March 6, 2006 to advise me that defendant had not yet responded to the document requests, interrogatories or notice of deposition (Yellen Decl., Ex. C). I directed defendant to respond to plaintiff's discovery requests no later than March 31, 2006 (Order dated March 10, 2006 (Docket Item 10)).
Defendant's counsel wrote to me on March 10, 2006 to request that all discovery be stayed, in light of the fact that they had "prepared numerous valid objections to discovery" that should be discussed at the next discovery conference (Yellen Decl., Ex. D). Finding that there was no valid reason to stay all discovery at that time, I denied defendant's application (Order dated March 13, 2006 (Docket Item 11)).
After holding a conference with the parties on April 18, 2006 in which discovery and scheduling disputes were discussed, I ordered defendant to produce all documents requested by plaintiff, serve complete verified answers to plaintiff's interrogatories and respond to plaintiff's requests for admission by May 2, 2006 (Order dated April 19, 2006 (Docket Item 12)). I also ordered defendant to appear for his deposition by May 31, 2006, and extended the deadline for all discovery to that date (Order dated April 19, 2006).
Defendant then requested a further extension of the discovery deadline, which I denied (Order dated May 19, 2006 (Docket Item 13)). In addition, I ordered defendant to produce his time and billing records to plaintiff by May 31, 2006 in electronic format, and I extended the deadline for party depositions until June 15, 2006 (Order dated May 19, 2006).
On June 19, 2006, plaintiff wrote to me to advise me that defendant had still not sent the time and billing records, nor had defendant set a date for his deposition; as a sanction, plaintiff sought the entry of a default judgment (Yellen Decl., Ex. G). Because of the severity of relief plaintiff sought, I ordered plaintiff to make a formal motion for sanctions (Order dated June 19, 2006 (Docket Item 15)). I also received a letter from defendant the same day, which stated that defendant was not ignoring orders from this Court and, in fact, had contacted plaintiff on June 14, 2006 and made defendant available for a deposition for the following seven business days (Letter from defendant's counsel to my chambers, dated June 19, 2006). According to defendant, plaintiff's counsel had scheduling problems and did not contact defendant about rescheduling, but instead, wrote to me on June 19 to request sanctions (Letter from defendant's counsel to my chambers, dated June 19, 2006).
On July 7, 2006, the parties had a status conference before the Honorable Richard C. Casey, United States District Judge, during which Judge Casey directed the parties to complete all depositions within one week. Following this status conference, counsel for both parties discussed when to schedule the depositions (Yellen Decl. ¶¶ 10-12). During these discussions, plaintiff's counsel indicated that he was willing to accommodate the fact that defendant would have to travel to the United States from Italy and, therefore, agreed that defendant's deposition could occur later that month (Yellen Decl., Ex. I). However, notwithstanding my own Orders and Judge Casey's Order, defendant's counsel initially took the position that he had no obligation to produce defendant for a deposition (Yellen Decl., Ex. I). However, defendant's counsel subsequently wrote to plaintiff's counsel on July 17, 2006 and stated "[w]e will be happy to produce Mr. Briguglio for deposition immediately following the deposition of Mr. Di Nardo" (Yellen Decl., Ex. L). Defendant's counsel then indicated that he would advise plaintiff's counsel of defendant's availability by July 19, 2006. On July 21, 2006, defendant's counsel proposed to plaintiff's counsel that both depositions take place the following week and that he did not have a preference as to which party was deposed first (Yellen Decl., Ex. O). According to plaintiff's counsel, he did not hear back from defendant's counsel the following week, and consequently filed this motion (Yellen Decl. ¶ 16).
On September 13, 2006, I held another conference with the parties in order to discuss the outstanding discovery disputes. When the issue of producing defendant's billing records in electronic format was discussed, defendant's counsel stated he had advised Judge Casey during the July 7, 2006 conference that his computer system did not have the capacity to produce such records in electronic format. According to defendant, Judge Casey ruled that defendant was not required to produce the documents in electronic format or to permit plaintiff to review the documents on defendant's computer (Statement of Kurt Dinkelmeyer, Esq. at September 13, 2006 discovery conference; Declaration of Kurt Dinkelmeyer, Esq. in Opposition to Plaintiff's Motion for Sanctions, dated August 10, 2006 ("Dinkelmeyer Decl."), ¶ 4). Following that conference, I ordered that defendant be deposed on September 18, 2006, with the deposition of plaintiff to follow immediately thereafter (Order dated September 14, 2006 (Docket Item 24)). The parties confirmed with my chambers several days later that the issue of the billing records had been resolved.
The Order incorrectly states that the conference occurred on September 14, 2006 instead of September 13, 2006.
Plaintiff's counsel wrote to me on February 8, 2007, advising me that (1) both parties were deposed in the Fall of 2006, (2) electronic discovery of the billing records was not produced and that defendant had explained that the computer which held the records was no longer functioning, (3) the billing records were produced in paper format, and (4) discovery is complete (Letter by plaintiff's counsel to my chambers, dated February 8, 2007).
Plaintiff contends that sanctions should be imposed because defendant has deliberately delayed the litigation. Specifically, plaintiff cites defendant's refusal to appear for his deposition while insisting that plaintiff be deposed and defendant's failure to produce his billing records in electronic format (Yellen Decl. ¶ 21). Plaintiff asks this Court to sanction defendant by (a) imposing attorney's fees, (b) striking defendant's answer, (c) precluding defendant from testifying at trial and/or (d) precluding defendant from submitting an affidavit in response to a motion for summary judgment (Yellen Decl., ¶ 22).
Plaintiff also sought, in the alternative to the requested sanctions, an Order directing defendant to produce the billing records in an electronic format at least one week prior to defendant's deposition. Plaintiff also requested defendant's deposition occur before plaintiff's deposition, and if defendant failed to appear for a deposition, then for a default judgment to be entered against him (Yellen Decl. ¶¶ 23-24). This request is moot, given Judge Casey's directive regarding the electronic records on July 7, 2006 and the fact that defendant was deposed.
Defendant opposed the motion, claiming that discovery delays were due to the fact that defendant had to be in Italy to settle his family there and because defendant's counsel had an accident which rendered him unable to work for nearly two months (Dinkelmeyer Decl., ¶ 2). Defendant also denies plaintiff's allegation that defendant was insisting that only plaintiff's deposition be taken, and contends that there was a misunderstanding concerning the depositions after the July 7, 2006 conference with Judge Casey (Dinkelmeyer Decl. ¶ 5). Defendant goes on to claim that this misunderstanding was quickly resolved and, subsequently, informed plaintiff's counsel that it did not matter which party was deposed first (Dinkelmeyer Decl. ¶ 5 Ex. B).
III. Analysis
Rule 37(b)(2) provides that a court may impose sanctions against a party that "fails to obey an order to provide or permit discovery. . . ." Salahuddin v. Harris, 782 F.2d 1127, 1132-33 (2d Cir. 1986). Sanctions may be granted against a party under Rule 37(b)(2) if there is noncompliance with an order, "notwithstanding a lack of wilfulness or bad faith, although such factors `are relevant . . . to the sanction to be imposed for the failure.'" Auscape Int'l v. Nat'l Geographic Soc'y, 02 Civ. 6441 (LAK), 2003 WL 134989 at *4 (S.D.N.Y. Jan. 17, 2003),quoting 8 Charles A. Wright, Arthur R. Miller Richard L. Marcus, Federal Practice Procedure § 2283, at 608 (2d ed. 1994); see Melendez v. Ill. Bell Tel. Co., 79 F.3d 661, 671 (7th Cir. 1996) ("Bad faith . . . is not required for a district court to sanction a party for discovery abuses. Sanctions are proper upon a finding of wilfulness, bad faith, or fault on the part of the noncomplying litigant." (citations omitted)); Alexander v. Fed. Bureau of Investigation, 186 F.R.D. 78, 88 (D.D.C. 1998) ("In making the determination of whether to impose sanctions, Rule 37(b)(2) does not require a showing of willfulness or bad faith as a prerequisite to the imposition of sanctions upon a party." (citations omitted)). The decision to impose sanctions "is committed to the sound discretion of the district court and may not be reversed absent an abuse of discretion." Luft v. Crown Publishers, Inc., 906 F.2d 862, 865 (2d Cir. 1990), citing, inter alia, Nat'l Hockey League v. Metro. Hockey Club, Inc., 427 U.S. 639, 642 (1976) (per curiam); see Design Strategy, Inc. v. Davis, 469 F.3d 284, 294 (2d Cir. 2006) ("A district court has wide discretion in imposing sanctions, including severe sanctions, under Rule 37(b)(2). . . ."); Daval Steel Prods. v. M/V Fakredine, 951 F.2d 1357, 1365 (2d Cir. 1991) (same); Dove v. City of New York, 06 Civ. 1096 (SAS), 20C6 WL 38002267 at *2 (S.D.N.Y. Dec. 26, 2006) (same).
Rule 37(b)(2) directs a court to "make such orders in regard to the failure as are just," including, inter alia, striking the party's pleading, precluding the introduction of certain evidence, or dismissing the action or rendering a judgment by default. Fed.R.Civ.P. 37(b)(2). Additionally, the court must impose reasonable expenses and attorney's fees on the disobedient party "unless the court finds that the failure was substantially justified or that other circumstances make an award of expenses unjust." Fed.R.Civ.P. 37(b)(2).
"In deciding whether to impose sanctions under Rule 37, the Court considers the following factors: `(1) the willfulness of the noncompliant party or the reasons for noncompliance; (2) the efficacy of lesser sanctions; (3) the duration of the period of noncompliance; and (4) whether the noncompliant party had been warned of the consequences of his noncompliance.' Nieves v. City of New York, 208 F.R.D. 531, 535 (S.D.N.Y. 2002) (citing Bambu Sales, Inc. v. Ozak Trading Inc., 58 F.3d 849 (2d Cir. 1995))."Oseni v. Tristar Patrol Servs., 05 Civ. 2875 (RJD) (LB), 2006 WL 2972608 at *7 (E.D.N.Y. Oct. 18, 2006).
The harsher remedies, such as preclusion of certain evidence, while permitted under Rule 37, "should be imposed only in rare situations. . . ." Update Art, Inc. v. Modiin Publ'g, Ltd., 843 F.2d 67, 71 (2d Cir. 1988). "Such a severe sanction is justified `when the failure to comply with a court order is due to willfulness or bad faith, or is otherwise culpable." Izzo v. ING Life Ins. and Annuity Co., 235 F.R.D. 177, 186 (E.D.N.Y. 2005), quoting Daval Steel Prods. v. M/V Fakredine, supra 951 F.2d at 1365.
A. Production of Billing Records in Electronic Format
The imposition of sanctions for defendant's failure to comply with my May 19, 2006 Order to produce his time and billing records in electronic format is not appropriate. Defendant has represented in both his opposition to the present motion and during the September 13, 2006 discovery conference that Judge Casey relived him of the obligation to produce these document in electronic format on the ground that it was impossible to do so. Although plaintiff has had the opportunity to do so, he has not controverted this representation.
Since the discovery order in issue was effectively vacated by Judge Casey, the imposition of sanctions is inappropriate.
B. Defendant's Deposition
Defendant's failure to comply with the multiple orders from both myself and Judge Casey directing that he appear for his deposition stands on a different footing.
The record clearly establishes that plaintiff had to seek and obtain four Orders from myself and Judge Casey before defendant appeared for his deposition. Clearly, these Orders were not mere suggestions that defendant had the option of accepting or rejecting. "[D]iscovery orders are meant to be followed. `A party who flouts such orders does so at his peril.'" Bambu Sales, Inc. v. Ozak Trading Inc., supra, 58 F.3d at 853, quoting Update Art, Inc. v. Modiin Publ'g, Ltd., supra, 843 F.2d at 73; see McDonald v. Head Criminal Court Supervisor Officer, 850 F.2d 121, 124 (2d Cir. 1988) (party against whom discovery order is issued must either obey the order or obtain stay and pursue appellate remedy).
As set forth above I issued Orders directing plaintiff to appear for his deposition on April 19, 2006 (Docket Item 12), May 19, 2006 (Docket Item 13) and September 15, 2006 (Docket Item 24). In addition, Judge Casey issued an oral order directing defendant to appear for his deposition on July 7, 2006.
Defendant's conduct here is unacceptable for several reasons. First, the discovery provisions of the Federal Rules of Civil Procedure "contemplate that discovery will proceed without judicial intervention unless a party moves for a protective order under Rule 26(c) or and order compelling discovery under Rule 37(a)." Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 357 n. 24 (1978). Thus, defendant's refusal to appear for his deposition in response to plaintiff's notice frustrates the intent and purpose of the Federal Rules of Civil Procedure.
Second, by forcing plaintiff to repeatedly seek judicial intervention in order to obtain the discovery to which he was entitled, defendant forced plaintiff to needlessly expend money in legal fees, making this more of a battle of attrition than an inquiry designed to find the truth. See Polaroid Corp. v. Casselman, 213 F. Supp. 379, 381 (S.D.N.Y. 1962) ("A lawsuit is not a game but a search for the truth. The ends of justice are served, not by giving one side a vested right to exhaust the other, but by affording both an equal opportunity to a full and fair adjudication on the merits.").
Third, defendant's baseless failure to comply with the Orders directing him to appear for his deposition contributed to the overall delay that, unfortunately, has infected judicial proceedings for centuries despite the best efforts of judges. See generally Moore McCormack Lines, Inc. v. Richardson, 295 F.2d 583, 594 n. 15 (2d Cir. 1961) (Lumbard, J.). All litigants are entitled to their day in court, but judicial time is squandered and all proceedings delayed when judges are forced to spend time issuing repetitive orders directing a party to provide the discovery that he unquestionably is obligated to provide.
Although I believe that a sanction is appropriate, I do not believe that the ultimate sanction of a default judgment is appropriate. As noted by the Honorable David N. Hurd, then Magistrate Judge, now United States District Judge, in Fritter v. Dafina, Inc., 176 F.R.D. 60, 63 (N.D.N.Y. 1997):
The Court may render a default judgment against a party who has failed to fully comply with a discovery order of the court. Fed.R.Civ.P. 37(b)(2)(C). Such a sanction is an extreme measure appropriate only in extreme circumstances. See Bambu Sales, Inc. v. Ozak Trading Inc., 58 F.3d 849, 853 (2d Cir. 1995); Woodstock Ventures LC v. Perry, 164 F.R.D. 321, 322 (N.D.N.Y. 1996) (citing Jones v. Niagara Frontier Transp. Auth., 836 F.2d 731, 734 (2d Cir. 1987)). Consequently, the Second Circuit limits default judgments to circumstances "involving willfulness, bad faith, or any fault on the part of the disobedient party." Altschuler v. Samsonite Corp., 109 F.R.D. 353, 356 (E.D.N.Y. 1986) (citing Societe Internationale Pour Participations Industrielles Et Commerciales, S.A. v. Rogers, 357 U.S. 197, 212, 78 S.Ct. 1087, 1095-96, 2 L.Ed.2d 1255 (1958)); see Jones, 836 F.2d at 734. In addition, though, the Second Circuit has held default judgment appropriate where there has been a total dereliction of professional responsibility, evincing circumstances of gross negligence. Cine Forty-Second St. Theatre Corp. v. Allied Artists Pictures Corp., 602 F.2d 1062, 1065-66 (2d Cir. 1979).See also National Communications Ass'n, Inc. v. American Tel. Tel. Co., 92 Civ. 1735 (LAP), 1998 WL 118174 at *3 (S.D.N.Y. Mar. 16, 1998); Sullivan v. City of New York, 94 Civ. 1643 (FB), 1997 WL 642321 at *2 (E.D.N.Y. Sept. 3, 1997); Jeanette Coquette Co. v. Hartford Fire Ins. Co., 93 Civ. 4417 (DAB), 1997 WL 527874 at *1-*2 (S.D.N.Y. Aug. 22, 1997); Edwards v. American Airlines, Inc., 95 Civ. 5356 (SAS), 1996 WL 432472 at *2-*3 (S.D.N.Y. Aug. 1, 1996); Starbrite Waterproofing Co. v. Aim Constr. Contracting Corp., 164 F.R.D. 378, 381-82 (S.D.N.Y. 1996).
Defendant's conduct, although inexcusable, has delayed the preparation of plaintiff's case but does not appear to have prejudiced plaintiff beyond that delay and attendant expense. Under these circumstance, I conclude that a case-dispositive sanction would be excessive. Welch v. Alexis, 03 CV 2528 (CBA), 2004 WL 1920810 at *3 (E.D.N.Y. May 26, 2004) ("[C]ourts have awarded attorney's fees and costs where sanctions were appropriate, but where the court found that the sanctioned party's conduct did not rise to the level of the drastic sanction of dismissal [or preclusion of evidence.]").
Defendant's disobedience of the Court's Orders is particularly troubling given that he is an attorney and, presumably, harbors a strong belief in the rule of law.
I conclude that a monetary sanction of $1,000.00 payable to plaintiff is an appropriate sanction here. I intend the sanction to be primarily compensatory rather than punitive. Based on my general knowledge of billing rates for attorneys in this District, I believe this sum will adequately compensate plaintiff for the legal fees he incurred in his repeated attempts to compel defendant to appear for his deposition and for the expense incurred in making the present motion.
IV. Conclusion
Accordingly, for the foregoing reasons, defendant is directed to pay plaintiff the amount of $1,000.00 within twenty (20) days of the date of this Order.
SO ORDERED