Case Law

Court Grants Terminating Spoliation Sanctions Due to Abusive Litigation Practices

Oregon

OmniGen Research v. Wang, 2017 U.S. Dist. LEXIS 78107 (D. Or. May 23, 2017) In this breach of contract and trade secret misappropriation case, the plaintiffs moved for terminating spoliation sanctions, asking the court to grant a default judgment in their favor. The plaintiffs alleged that the defendants had the intent to hide or destroy important evidence that would interfere with the court’s ability to issue a fair decision. The court turned to FRCP 37(b)(2) and 37(e) to determine if terminating sanctions could be used against the defendants. The court stated, “The applicable standard of proof for spoliation motions in the Ninth Circuit is the preponderance of evidence”. In the motion, the plaintiffs cited several instances where the defendants either hid or destroyed evidence, such as donating their desktop computer to Goodwill, intentionally deleting emails from both of the defendants’ personal computers and several email accounts, and intentionally destroying metadata. In response, the defendants made several arguments that the court did not find convincing. The defendants argued donating their desktop computer to Goodwill was a mere coincidence, even though they had already received two preservation letters by the plaintiffs. The defendants further stated that the desktop computer was used only by their son. The court found for the plaintiffs, issuing a default judgment and dismissing the defendants counterclaims, citing FRCP 37(b)(2) and 37(e) for spoliation of evidence. Specifically, the court found that the defendants intentionally deleted the documents that were essential to the plaintiffs’ case. Further, the court found that all the required elements of spoliation were met under the preponderance of evidence standard, and the court had the inherent authority to sanction the abusive litigation practices by the defendants.

Keywords: destroying files, deleted email, sanctions, intentional spoliation, FRCP 37(e), default judgement