Archive: January 19, 2007

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Court Modifies Its Prior Cost-Shifting Formula
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Recounting Defendants’ “Systemic and Shocking” Discovery Abuses, Court Imposes Severe Sanctions and Appoints Discovery Monitor

Court Modifies Its Prior Cost-Shifting Formula

Quinby v. WestLB AG, 2007 WL 38230 (S.D.N.Y. Jan. 4, 2007)

In this opinion, the court modified its September 5, 2006 order (summarized here) which shifted to the plaintiff 30 percent of the costs of producing the emails of one witness (Barron) restored from backup tapes. After that prior order was entered, defendant submitted an affidavit from its vendor stating that 14 backup tapes had been restored in order to recover Barron’s emails, and that the total cost was $9,187.50. Plaintiff submitted a letter and exhibits in response, pointing out that the 14 tapes also contained the emails of other custodians whose emails were ordered produced and the tapes would, therefore, have had to have been restored in any event. Plaintiff argued that she should be responsible for only 30 percent of the share allocable to Barron’s emails.

The court agreed, and found it unfair to shift a portion of the entire cost since the backup tapes would have had to have been restored even if Barron’s emails had not been ordered produced. The court set out its formula for calculating plaintiff’s share of the cost, which amounted to $448, and ordered plaintiff to remit that amount to defendant within ten days.

Recounting Defendants’ “Systemic and Shocking” Discovery Abuses, Court Imposes Severe Sanctions and Appoints Discovery Monitor

Wachtel v. Health Net, Inc., 239 F.R.D. 81 (D.N.J. 2006)

In this lengthy opinion, the court ruled upon plaintiffs’ motion for entry of default based upon defendants’ discovery misconduct and other discovery-related motions. Although it reserved judgment on whether a default should be entered, the court found that a variety of severe sanctions were appropriate given defendants’ “systemic and shocking” discovery abuses. The sanctions included: (1) deeming certain facts as admitted by defendant for all purposes in the litigation, including equitable relief; (2) precluding defendant’s use of documents not produced in discovery; (3) striking privilege assertions as to certain documents; (4) imposing monetary sanctions in an amount to be determined after the court considered defendant’s financial situation; and (5) appointing a discovery monitor at defendants’ expense to review defendants’ compliance with the court’s discovery orders. The court explained:
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