Case Law

“Unusually Deplorable” Conduct Costs Plaintiff $7 Million in Sanctions


Shawe v. Elting, 2017 Del. LEXIS 61 (Del. Feb. 13, 2017) In this business dispute, the plaintiff appealed the Court of Chancery’s decision ordering the plaintiff to pay the defendant’s legal fees totaling over $7 million. The parties were business partners and former romantic partners, and were engaged in highly contentious litigation. The Chancery Court found that the plaintiff committed several bad acts including, among other things, breaking in to the defendant’s office and having a third party image her hard drive; concealing his activities with a write blocker; accessing 19,000 of the defendant’s emails, 12,000 of them privileged communications with defendant’s counsel; deleting nearly 19,000 files from his computer after placing his own legal hold due to impending litigation; hiring a third party to break into the defendant’s office to take photos and remove documents; attempting to destroy 44,000 documents from his laptop after the court ordered expedited discovery; failing to preserve his mobile phone and its contents; and giving false testimony. The court held that there was no abuse of discretion, that the plaintiff acted in bad faith with his “egregious conduct and multiple falsehoods,” and that court was “well within its discretion to impose sanctions.” Additionally, the court found that the sanctions were not in excess, as they were to compensate the defendant’s actual litigation expenses.

Keywords: Preservation, bad faith, sanctions, abuse of discretion, discovery, misconduct, legal hold