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Discovery Sanctions as an Independent Case Strategy:
An Alarming Trend in Litigation
Court-ordered discovery sanctions are becoming more commonplace in litigation. For example, in the recently publicized case of Tutor-Saliba-Perini v. Los Angeles County Metropolitan Transportation Authority ("Tutor-Saliba")1, the trial court imposed $100,000 in sanctions and, ultimately, issued evidentiary and issue sanctions, essentially resulting in the striking of Tutor-Saliba-Perini's complaint, as well as it and its sureties' answers to the MTA's cross-claims. As a result, Tutor-Saliba not only lost it ability to prosecute an affirmative construction claim, but it and its sureties were unable to defend a multi-million dollar cross-claim. While sanctions may be merited in some cases, this Practice Tip addresses what appears to be an alarming new trend in litigation: the pursuit of discovery sanctions as a case strategy in and of itself.
Motivation to Pursue Discovery Sanctions
Why would a litigant plan to create discovery disputes and force motions to compel? Quite simply, discovery sanctions can cure a case with bad facts. If a judge perceives that one party is hiding information in discovery responses, the judge has broad discretion to sanction that party or its counsel. These sanctions can be severe, crippling the best of cases, and saving the worst. In extreme instances a court can prohibit a litigant from presenting evidence or defending itself.
Purpose and Types of Sanctions Available
Sanctions are mainly designed to encourage compliance with discovery rules. See, Fairfield v. Superior Court (1966) 246 Ca1.App.2d 113, 119.2 The secondary purpose for sanctions is to punish the discovery-abusing party. Deyo v. Kilbourne (1978) 84 Ca1.App.3d 771, 796. Typically, the punishment is a monetary award to the "innocent," or "injured," party, derived from the fees that that party incurred in its motion to compel. However, courts have broad discretion and can impose harsher penalties than monetary fines. A judge may deem facts admitted, or conversely, prohibit a party from using specified evidence. Sometimes, a judge may strike a party's complaint or answer, which (obviously) can end the litigant's chance of prevailing or limiting damages.
While evidentiary and issue sanctions are rare and terminating sanctions even rarer, a recent trend in litigation involves opposing counsel propounding discovery solely to obtain sanctions. Further, insurers make good targets because they typically (i) had minimal, if any, involvement in the underlying transactions or incidents, and (ii) base their knowledge primarily on a post-event investigation. Thus, insurers typically are unable to explain in detail what happened and often assert privilege objections because their counsel conducted the post-event investigation. Not being sensitive to the insurer's function and often not wishing to sort through the bickering of counsel, a judge may mistake the insurer's inability to respond or its assertion of privilege objections for gamesmanship.
Recognizing Discovery Aimed at Obtaining Sanctions
Discovery aimed at obtaining sanctions is sometimes difficult to recognize. The attorney may attribute inappropriate discovery requests to opposing counsel's ignorance of the insurer's role. If the opposing counsel does not agree to limit discovery after an informal explanation of the nature of the insurer's role, the attorney should be wary. If the discovery sought is similar to the following, the attorney should wonder about the opposing counsel's motives:
- discovery requests that are remote to the claims or defenses;
- discovery requests aimed at organization and business practices;
- discovery requests that are cumulative, invasive, and require significant resources to response; and
- post-discovery "meet and confer" position letters, that include misleading descriptions of the communications or falsely state the attorney's position on discovery matters.
Examples of Discovery Requests Aimed at Seeking Sanctions
Consider the following examples:
- Describe in detail (by identifying the participant and stating each action, communication, or other conduct, including the dates, times and witnesses involved) the procedure the insurer followed in deciding to issue the subject policies [where the policies are admitted to have been issued].
- Describe in detail (including all communications and complete contact information for all participants) all of the insurer's efforts to mitigate damages.
- Produce all documents and computer files (including all emails and computer data, whether on servers, hard drives, or hand held devices) relating to the insured.
- For each public entity that has registered or licensed the insurer in the last ten (10) years:
- identify the license or registration,
- state the name of each public entity, and
- state the date of issuance and expiration of each license.
These requests are arguably not proper because they fail to recognize that the insurer is an outsider to the subject transactions or events in dispute, they seek information that will never be issues in the case (e.g., out of state licenses), and they burden the insurer with time and expense in preparing responses. If, after the attorney explains the circumstances to opposing counsel, opposing counsel refuses substantially to limit its discovery and accuses the attorney of failing or refusing to respond to "basic discovery," the attorney should be wary of counsel's motives.
Strategies for Responding to Discovery Aimed at Obtaining Sanctions
Judges loath discovery disputes. Like parents confronting bickering between siblings, judges simply do not want to hear about the communications between counsel over discovery disputes. With the judge in mind, here are several tips for responding to opposing counsel's discovery:
Judges loath discovery disputes. Like parents confronting bickering between siblings, judges simply do not want to hear about the communications between counsel over discovery disputes. With the judge in mind, here are several tips for responding to opposing counsel's discovery:
- Be Reasonable And Focus On Your Audience.
It can be infuriating if opposing counsel is consistently mischaracterizing communications. However, because the opposing counsel is intent on bringing a motion to compel, the ultimate audience is the judge. Therefore, above all else, assert reasonable positions in correspondence and offer alternatives in addition to objections.
- Keep Pace Unless Cost Prohibitive.
If opposing counsel sends multiple position letters over a short period of time, consider whether or not a response to each is appropriate. From an objective viewpoint, multiple position letters may be unreasonable. However, opposing counsel is likely to move to compel each of the issues contained in each separate position letter, at separate times, in separate motions. Thus, it may be difficult to provide the court with a realistic view of opposing counsel's overreaching and abusive tactics. Additionally, it may be costly to go back and review the files and "correct the record" after the fact. Nonetheless, depending on the discovery at issue, the size and complexity of the case, and the cost of keeping pace, the attorney may decide to abstain from such exchanges. Alternatively, the attorney should consider responding to multiple position letters on different issues all within one letter to provide the court with the larger perspective.
- Weigh the Costs and Benefits Of Seeking A Protective Order.
If the abuse continues despite reasonable efforts to keep up with opposing counsel's discovery demands, consider a protective order. In fact, depending on the breadth of the pending discovery demands, it may be more cost effective to make the first move, rather than standing on proper objections. Because the burden of limiting discovery is on the party seeking a protective order, only seek a protective order when the costs of the motion are warranted.
Conclusion
Especially in California, discovery sanctions are commonplace. As long as judges loath discovery disputes, court's will consider awarding discovery sanctions. The prospect of obtaining sanctions that can cure an otherwise weak case seems to be driving this disturbing new trend. Be on the lookout for such discovery, and carefully prepare a strategy for responding.
Endnotes
1 Los Angeles Superior Court Case No. BC 123559. This case is referenced purely as an publicized example of the potential severity of court ordered sanctions. The authors make no comment on the merits of the underlying claims or the sanctions award.
2 Since the authors primarily practice in California, California law is used.
© 2003. Defense Research Institute, Inc. Reproduced with permission.
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