United States District Court, N.D. Indiana, Fort Wayne Division
OPINION AND ORDER
Collins United States Magistrate Judge
Enterprises and Scottsdale Insurance Company (as subrogee of
Dorado Enterprises) (together “Plaintiffs”) bring
the instant action, alleging that Defendant Total Property
Care, Inc. (“TPC”), manufactured and sold
defective lighting fixtures or rafts to Plaintiffs. (DE 21).
Dorado acted as a general contractor for build-outs of three
restaurants (one in Michigan, one in Illinois, and one in
Pennsylvania). (DE 21 ¶ 2). Dorado purchased and
installed lighting rafts from TPC for the three restaurants.
(DE 21 ¶ 2). Shortly after installation, the lighting
rafts failed and began to fall to the floor; Dorado settled
with the restaurants in mediation, and then Dorado sued TPC.
(DE 21 ¶¶ 3-9).
February 2015, Plaintiffs gave TPC an opportunity to inspect
the allegedly defective lighting rafts; however, TPC declined
to do so. (DE 56-1; DE 56-2). Selective Insurance, who
insured TPC, then began communicating with Plaintiffs on
TPC's behalf and a representative of TPC told Plaintiffs
that TPC would “defer to [Selective] as to further
proceedings.” (DE 56-3). In April 2016, Plaintiffs
informed Selective that their expert retained the defective
lighting rafts from Michigan and Illinois in anticipation of
litigation, but that the Pennsylvania lighting rafts would be
dismantled soon as part of the repairs to the Pennsylvania
restaurant. (DE 56-4). Plaintiffs offered Selective the
opportunity to inspect the Pennsylvania lighting rafts before
they were destroyed. (DE 56-4).
filed this action against Defendants on June 22, 2016. (DE
1). A preliminary pretrial conference was conducted on
September 13, 2016, setting a discovery deadline of May 30,
2017, which was later extended to December 31, 2017. (DE 15;
DE 43). A representative for TPC, Mr. Canfield, was supposed
to be deposed by Plaintiffs on December 11, 2017. (DE 45 at
3). However, Mr. Canfield became ill, and the parties filed a
joint motion to extend the discovery deadline so that Mr.
Canfield could be deposed later. (DE 49). The Court granted
the motion, and the parties were given to and including
January 11, 2018, to complete discovery. (DE 50).
December 21, 2017, TPC served Plaintiffs and Plaintiffs'
expert with discovery requests, both of which included a
request to produce each allegedly defective lighting raft.
(DE 53-1; DE 53-2). Plaintiffs and their expert did not
respond to the discovery requests.
March 16, 2018, TPC filed the instant motion for sanctions,
alleging that Plaintiffs and their expert had not responded
to its discovery requesting the production of the defective
lighting rafts, and that counsel for Plaintiffs represented
that these lighting rafts had not been preserved for
litigation. (DE 53). As a consequence, TPC requests that the
Court: (1) dismiss the case; (2) rule that nobody can testify
as to the examination of the now missing lighting rafts; or
(3) extend the time to file dispositive motions.
April 30, 2018, Plaintiffs responded that they were not
obligated to respond to TPC's discovery requests because
they were not timely served-the requests were served on
December 21, 2017, less than 30 days before the close of
discovery on January 11, 2018. (DE 56). Further, Plaintiffs
represent that portions of the allegedly defective lighting
rafts have been preserved and will be available for TPC's
inspection at trial. (DE 56).
2, 2018, TPC filed a reply claiming that the parties had
intended for the request for an extension of time to January
11, 2018, to complete discovery to also allow time for
Plaintiffs to respond to TPC's discovery requests. (DE
3, 2018, the Court held a telephonic hearing on TPC's
motion for sanctions. (DE 58). At the hearing, Plaintiffs
represented that they retained portions of the Pennsylvania
lighting rafts and that their expert's report contains a
description of the condition of the Pennsylvania lighting
rafts before they were dismantled. TPC requested that the
Court re-open discovery in this case to obtain responses to
its discovery requests issued in December 2017.
party has a duty to preserve evidence over which it has
control and reasonably knows or could foresee would be
material to a potential legal action.” Bryant v.
Gardner, 587 F.Supp.2d 951, 967-68 (N.D. Ill. Nov. 21,
2008) (“The Court has discretion to sanction a party
for spoliation of evidence.” (citation omitted));
see also ChampionsWorld, LLC v. U.S. Soccer
Fed'n, 276 F.R.D 577, 582 (N.D. Ill. Aug. 17, 2011)
(citation omitted). “Sanctions [for spoliation of
evidence] include awarding reasonable expenses, attorney
fees, barring evidence or arguments, permitting adverse
inferences, and dismissing claims or entering default
judgment.” Bryant, 587 F.Supp.2d at 968
(citations omitted); see Norman-Nunnery v. Madison Area
Tech. Coll., 625 F.3d 422, 428 (7th Cir. 2010)
(“In order to draw an inference that the missing
documents contained information adverse to the defendants,
[the plaintiff] must demonstrate that the defendants
intentionally destroyed the documents in bad faith.”
from the discovery rule, a court has the inherent authority
to manage judicial proceedings and to regulate the conduct of
those appearing before it, and pursuant to that authority may
impose appropriate sanctions to penalize and discourage
misconduct.” Ramirez v. T&H Lemat, Inc.,
845 F.3d 772, 776 (7th Cir. 2006) (citing Chambers v.
NASCO, Inc., 501 U.S. 32, 46-50 (1991)). In finding that
sanctions for spoilation are appropriate, a Court must be
(1) that there was a duty to preserve the specific documents
and/or evidence, (2) that the duty was breached, (3) the
culpability for the breach rises to a level of willfulness,
bad faith or fault, (4) the party seeking the evidence
suffered prejudice as a result of the ...