Case Summary: Bunnell; Terminating Sanctions and Default Judgment appropriate for Willful, Systemic Spoliation

In this copyright infringement case, the court held that terminating sanctions and the entry of default judgment in favor of the requesting party was appropriate the court found:

• User forum postings had been systematically reviewed for the purpose of modifying or deleting those which referred to acts associated with copyright infringement;
• Directory headings where copyrighted content was stored was changed from specific names of television shows to more generalized names (e.g., “TV-Unsorted”).
• Evidence suggested that [Producing Party] may have failed to produce previously existing, unaltered versions of these directories.
• Producing Party failed to produce, and claimed not to possess, the full IP addresses related to clients downloading works protected by copyright laws, where evidence suggested that the party did in fact have this information.
• Producing party failed to produce names of forum moderators, as required.

Columbia Pictures Inc. v. Bunnell, No. 2:06-cv-01093 (C.D. Cal. Dec. 13, 2007) (Order Granting Plaintiffs’ Motion for Terminating Sanctions)

Case Blurb: Hawaiian Airlines; Factors to Consider before Imposing a Default or Dismissal Sanction

A default or dismissal sanction can be imposed only based upon a finding of willfulness, fault, or bad faith. In addition, the court should consider: (1) the public’s interest in expeditious resolution of litigation; (2) the court’s need to manage its dockets; (3) the risk of prejudice to the party seeking sanctions; (4) the public policy favoring disposition of cases on their merits; and (5) the availability of less drastic sanctions.

A list of factors like this one “amounts to a way for a district judge to think about what to do, not a series of conditions precedent before the judge can do anything, and not a script for making what the district judge does appeal proof.”

In re Hawaiian Airlines, Inc., 2007 WL 3172642 (Bkrtcy. D.Hawaii October 30, 2007).

Case Summary: Tschirhart; Court grants a default judgment to plaintiff after finding defendant deliberately destroyed evidence

In a trial concerning copyright infringement by the user of peer-to-peer systems, the court granted plaintiff recording company a default judgment against defendant, concluding that defendant deliberately destroyed the evidence, music files that had resided on the hard drive of her computer, in bad faith. A forensics expert found that defendant had “wiped” the hard drive after notice of litigation and again after the court ordered defendant to produce the computer for a forensic examination. Defendant, while not disputing the deletion operations occurred, claimed that they occurred as a part of automated defragmentation operations. The court was not convinced. In addition to a finding of bad faith, the court also found that the three elements required by the Fifth Circuit to dismiss the case had been established. Specifically, the court concluded that: (1) the destruction of evidence was attributable to the client and not the attorney; (2) the destruction caused substantial prejudice to the opposing party; and (3) a less drastic sanction was not appropriate. The plaintiff’s motion for terminating sanctions was granted, while defendant was ordered to pay the amount of the costs and fees relating to the filing of the motion. Arista Records LLC v. Tschirhart, 241 F.R.D. 462 (W.D. Tex. 2006).

Case Blurb: Napster C/R Litigation; Court discusses factors to consider for Default Judgement Sanction, 9th Circuit

When considering a default sanction in response to spoliation of evidence, the court must determine:

• The existence of certain extraordinary circumstances;
• The presence of willfulness, bad faith, or fault by the offending party;
• The efficacy of lesser sanction; and
• The nexus between the misconduct drawing the sanction and the matters in controversy in the case. In re Napster, Inc. Copyright Litigation, 462 F.Supp.2d 1060 (N. D. Cal. 2006) (citing Halaco Eng’g Co. v. Costle, 943 F.2d 976, 380 (9th Cir. 1988).
• Additionally, the court may consider the prejudice to the moving party as an “optional” consideration where appropriate. In re Napster, Inc. Copyright Litigation, 462 F.Supp.2d 1060 (N. D. Cal. 2006) (citing Halaco Eng’g Co. v. Costle, 943 F.2d 976, 380 (9th Cir. 1988).

The multi-factor test is not “a mechanical means for determining what sanction is just, but rather “a way for a district judge to think about what to do. Id.
Extraordinary circumstances exist where there is a pattern of disregard for Court orders and deceptive litigation tactics that threaten to interfere with the rightful decision of a case. Id. (citing several cases).
Dismissal is warranted where…a party has engaged deliberately in deceptive practices that undermine the integrity of judicial proceedings. Id. (citing Annheuser-Busch, Inc. v. Natural Beverage Distributors, 709 F.2d 585, 591 (9th Cir. 1983)).
[T]he deliberate deception and irreparable loss of material evidence justifie[s] the sanction of dismissal. Id. (citing Wyle. V. R.J. Reynolds Tobacco Co., 709 F.2d 585, 591 (9th Cir. 1983)).

Case Blurb; Quintus Corp.; Appropriateness of Default Judgment as Sanction

Judgment is [an] appropriate sanction where destruction of documents deprives adversary of critical evidence. In re Quintus Corp. v. Avaya, Inc., 353 B.R. 77 (Bkrtcy. D. Del. 2006) (citing Shepherd v. Am. Broad. Cos., F.3d 1469, 1479 (D.C. Cir. 1995)).