Court Sanctions Plaintiff and Counsel for Misuse of Discovery Process, Including Failing to Reveal That Relevant Cell Phones were Discarded

Moreno v. Ostly, No. A127780, 2011 WL 598931 (Cal. Ct. App. Feb. 22, 2011)

After initially resisting discovery, plaintiff produced a laptop and cellular phone for examination.  Upon inspection, it was discovered that neither device was in use during the relevant time period.  Moreover, the relevant devices were no longer in plaintiff’s possession.  When challenged as to why this was not disclosed initially, counsel explained that he was torn between his “competing duties” of protecting his client and candor to the court.  Rejecting plaintiff’s and her counsel’s explanations, the court entered monetary sanctions against them.  On appeal, the sanctions were affirmed.

In this case in which plaintiff alleged sexual harassment, retaliation, and failure to pay back wages, defendants sought to discover relevant emails and text messages sent between plaintiff and her alleged harasser and specifically requested production of plaintiff’s computer and cell phone for examination.  Plaintiff objected, arguing that the discovery was overly broad.  Following a court order to produce plaintiff’s personal computer and cell phone, however, plaintiff’s counsel agreed to deliver them to defendants.  Upon inspection of the devices produced, defendants discovered that neither was from the relevant time period and that, in fact, the cellular phone had not even been manufactured until after the relevant period had ended.  When challenged, plaintiff’s counsel indicated that “he always understood” the request to be for the devices currently in plaintiff’s possession.  When pressed to identify how many computers and cell phones had been used during the relevant period, when plaintiff used them, and what happened to them, plaintiff’s counsel took the position that defendants would have to conduct further discovery.  Thereafter, defendants filed a motion for sanctions.

It was eventually revealed that plaintiff used two different cell phones during the relevant period but that neither remained available for inspection.  Plaintiff admitted that one had been discarded but, as the court noted in its analysis, it remained “unclear” what had happened to the other.  For his part, counsel stated that he had not revealed what he had learned from his client about her cell phone because of attorney-client privilege.  Expanding upon that explanation at a hearing on the issue, counsel explained that “he felt he had a ‘competing set of duties’”, namely his obligation to protect his client, who could be accused of spoliation, and his duty of candor to the court and opposing counsel and that he “felt like he was walking a tightrope” trying to advocate for his client “while at the same time be[ing] candid.”

The trial court found the explanation “not very credible” and "referenced another party . . . as having a similar problem" (where plaintiff’s former work computer had been replaced and could not be produced) but that the party had been frank with the court and thus precluded the need to "spend a whole lot of time on all these issues."  The court went on to express “astonish[ment] at [counsel’s] explanation, and to being upset upon learning that the devices [counsel] was trying so vehemently to resist producing did not exist.”  The court also noted the lack of clarity regarding what happened to the second cell phone, and “expressed the view that there was still some ‘evasion’" with regard to the present whereabouts of the devices.  Accordingly, the court indicated that it would award monetary sanctions and asked defendants’ counsel to provide a declaration “updating the actual amount of attorney fees incurred in preparing a reply brief and in attending the hearing.”  Upon submission of the declaration, the court issued a written order awarding sanctions in the amount of $13,500.  In addition to repeating that counsel’s explanations were “simply not credible,” the court also “pointed to statements made in the pleadings filed by [counsel] in the course of the dispute ‘that were patently designed to leave the impression upon this Court that [Moreno] had diligently inspected computer [sic] and cell phones used during the relevant time frame, that she had produced all relevant and responsive email and text messages….”

Specifically, the trial court concluded that the actions of plaintiff and her counsel were a “misuse of the discovery process” and found that the “‘misuse of the discovery procedures,’ ‘particularly as to the cell phone,’ included the making of unmeritorious objections without substantial justification to discovery or motions to compel (§ 2023.010, subds.(e), (h)), the making of evasive responses to discovery (§ 2023.010, subd. (f)), and the failure to confer in a reasonable and good faith attempt to resolve informally any dispute (§ 2023,010, subd. (i)).”  Plaintiff appealed the order.

On appeal, the appellate court found that monetary sanctions were authorized by California law and warranted by the facts of the case.  In support of its holding, the court expressed that it too was “mystified” by counsel’s failure to disclose that the phones were no longer in plaintiff’s possession and further cited counsel’s and plaintiff’s lack of good faith in their initial resistance to the production request despite knowing the phones were no longer in plaintiff’s possession and the “charade” of producing plaintiff’s current phone and computer to defendants’ expert.

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