With its recent decision in Green v. Blitz U.S.A., Case No: 2:07-CV-372 (E.D. Tex. Mar. 1, 2011), the U.S. District Court for the Eastern District of Texas issued a wake-up call for litigators. U.S. District Judge T. John Ward laid down the law for a defendant that appeared oblivious to basic ESI discovery obligations. In this case, over two years after the defendant’s favorable jury verdict, the court imposed sanctions upon the defendant for discovery abuse.
Plaintiff’s counsel tried this product liability case to a conclusion. After verdict on November 8, 2008, the case was resolved by the high-low agreement. Plaintiff’s counsel was also counsel for another plaintiff in a similar claim also against Blitz. There, plaintiff’s counsel received documents that Blitz had failed to produce in the Green litigation. In February 2011, Green moved to re-open her case. The Court did not re-open the case as more than a year had passed from the conclusion of the trial. Fed.R.Civ.P. 60(c) prohibits re-opening a case if more than a year has passed from the final judgment. Instead, the court sanctioned Blitz.
Citing Fed.R.Civ.P 37 and its inherent powers, the court imposed sanctions for Blitz’s failure to comply with its discovery order. Id. at 5-6. The underlying facts are instructive. Blitz’s representative responsible for producing discovery in the array of cases Blitz faced did not institute a litigation hold, did not perform electronic word searches, and did not coordinate his efforts with Blitz’s IT Department. He was a self-described “face-to-face” guy. Id. at 7-8. Green’s counsel identified a number of relevant key documents not produced that he alleged would have changed the outcome of Green’s claims. Id.
The court’s discovery order required production of relevant documents, the agreed pretrial order obligated counsel to certify compliance with the court’s discovery order, and a separate order required counsel to supplement their discovery answers and document production. Citing Blitz’s multiple failures to produce relevant documents, the court found that Blitz’s conduct was willful. Blitz’s bumbling efforts at discovery were led by a man who claimed to be computer illiterate. Id. at 12. The Court noted that any competent effort to identify electronic discovery would have netted the documents not produced. Id. at 11.
The court also took issue with Blitz’s failure to preserve potentially relevant documents. Id. at 14-15. Upon questioning by the court, Blitz’s computer illiterate head-of-discovery freely admitted to the court that he had not even issued a litigation hold letter. Id. at 15-16. The coup de grâce came when the court noted that “Finally, to make matters worse, Blitz rotated its backup tapes every two weeks during this time period—at such time the backup tapes were permanently deleted—so the deleted emails by employees were permanently lost.” Id. at 16.
Having inflicted body-blow after body-blow, the court then imposed a Civil Compensatory Sanction on Blitz of $250,000 for its failure to comply with the ESI issues and the court’s order. Id. at 18. The court did not rest there. Next, it imposed a Civil Purging Sanction of $500,000 that would be imposed unless within 30 days Blitz notified every plaintiff in every suit it had of the sanction imposed by providing a copy of the court’s Memorandum Opinion and Order. Id. at 19. Last, but not least, the Court ordered Blitz for the next five years to file a copy of the Memorandum Opinion and Order in every new case brought against it. Id. at 20.
As they say, “Don’t Mess with Texas,” or for that matter, U.S. District Judge T. John Ward.
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