1 UNITED STATES DISTRICT COURT
2 DISTRICT OF NEVADA
3 MICHELLE CHISM, Case No. 2:20-cv-00967-ART-DJA
4 Plaintiff, ORDER v. 5 COSTCO WHOLESALE 6 CORPORATION,
7 Defendant. 8 In this personal injury lawsuit, Plaintiff Michelle Chism seeks a spoliation 9 jury instruction (ECF No. 57). The Court previously granted Plaintiff’s request for 10 a spoliation instruction (ECF No. 63) and instructed parties to file supplemental 11 briefing regarding the type of jury instruction. For the following reasons, the 12 Court finds that an adverse inference jury instruction is the appropriate remedy. 13 I. BACKGROUND 14 Plaintiff suffered a severe head injury after slipping at Costo in April 2019. 15 (ECF No. 1 at ¶ 9.) Plaintiff alleges that while she was walking down the aisle, she 16 “encountered a condition that caused her to fall to the floor.” (Id.) Her head injury 17 “required emergency medical attention and hospitalization and has left her with 18 life-long debilitating injuries.” (Id.) She brings two claims: (1) negligence/gross 19 negligence/premises liability; and (2) negligent hiring, supervision, and retention. 20 (ECF No. 1 at ¶¶ 8–23.) 21 Nobody observed the fall. (ECF No. 57-4 at 3.) Plaintiff was with her 22 boyfriend, Eddie Diaz, at the time. (Id.) Diaz told first responders that Chism had 23 been experiencing flulike symptoms for the past few days but had been getting 24 better. (Id.) There is a dispute as to how many cameras covered the area of the 25 fall. According to Jaime Roxanne Morreira, there were at least four cameras 26 providing coverage of the area. (ECF No. 57-13 at 3.) According to Michael Le, an 27 administrative manager at Costco, there was only one camera (ECF No. 57-5 at 28 9.) Costco failed to preserve any of this footage. 1 Michael Le stated in his deposition that he reviewed the video surveillance 2 that day. (ECF No. 55-1 at 92.) He recalled seeing only one camera angle and 3 could not recall exactly where the camera was located. (Id. at 93.) He recalled 4 seeing Plaintiff “walking back and forth” in the aisle that she fell in. (Id.) He 5 recalled that the view was partially obstructed by shelving, and that he saw just 6 “just . . . drop down.” (Id.) The video was recorded over three months after the 7 incident. (ECF No. 72 at 19.) 8 At the time, Costco had a written policy which outlined several steps that 9 should be taken in the event of a member injury or incident. (ECF No. 57-12.) 10 Among other things, the policy instructed members to photograph the area, 11 report the incident, request that the member complete an incident form and write 12 their opinion of the cause on a separate piece of paper. (Id. at 2.) The policy 13 instructed that: “[s]urveillance video must be retained as evidence following a 14 bodily injury incident regardless of whether it captures the incident” and 15 recommended that the record time included “2 hours before and 2 hours after 16 the incident.” (Id.) 17 An incident report was never completed, and Costco did not preserve the 18 surveillance footage. (ECF No. 55-1 at 92.) Eight days after the accident, Mr. Diaz 19 returned to Costco and spoke to Michael Le about “what happened.” (Doc. No. 20 55-1 at 158.) But Plaintiff and Diaz did not otherwise indicate that they were 21 pursuing litigation. (Id.) According to Defendant, Costco did not receive a letter of 22 representation or letter to preserve evidence from Plaintiff’s counsel until several 23 months after the video had been “recycled in accordance with Costco policies.” 24 (ECF No. 85 at 7.) 25 In November 2023, the Court held a hearing on Defendant’s motion for 26 summary judgment and Plaintiff’s motion for spoliation. (ECF No. 72.) The Court 27 denied Defendant’s motion for summary judgment, noting that although 28 Plaintiff’s evidence was weak, there was a proof issue created by Costco due to 1 the lack of video evidence. (Id. at 25.) The Court granted Plaintiff’s motion for 2 spoliation, finding that the requirements of Rule 37(e) had been satisfied: the 3 video should have been preserved in anticipation of litigation, the video was lost 4 because Defendant failed to take reasonable steps to preserve, and the video 5 could not be restored or replaced. (Id. at 26–27.) The Court stated that it would 6 issue a sanction in the form of a jury instruction and allow the parties to brief 7 the appropriate discussion at a later point. (Id. at 28.) That issue is now before 8 the Court. 9 II. LEGAL STANDARD 10 Courts have inherent authority to sanction parties for spoliation of 11 evidence. Leon v. IDX Systems Corp., 464 F.3d 951, 958 (9th Cir. 2006). “In 12 considering what spoliation sanction to impose, if any, courts generally consider 13 three factors: (1) the degree of fault of the party who altered or destroyed the 14 evidence; (2) the degree of prejudice suffered by the opposing party; and (3) 15 whether there is a lesser sanction that will avoid substantial unfairness to the 16 opposing party.” Apple Inc. v. Samsung Elecs. Co., 888 F. Supp. 2d 976, 985 (N.D. 17 Cal. 2012) (cleaned up). Courts should choose “the least onerous sanction 18 corresponding to the willfulness of the destructive act and the prejudice suffered 19 by the victim.” Id. (citation omitted). 20 Courts apply three tiers of sanctions for spoliation with corresponding 21 levels of culpability. In severe cases of bad faith spoliation, a court may strike a 22 spoliating defendant’s answer or enter default judgment on specific issues. See 23 In re Napster Copyright Litig., 462 F. Supp. 2d 1060 (N.D. Cal 2006); see also 24 Peschel v. City Of Missoula, 664 F. Supp. 2d 1137, 1146 (D. Mont. 2009). In the 25 middle tier of culpability, a court may impose a mandatory, rebuttable 26 presumption “when a spoliating party has acted willfully or recklessly.” Apple Inc. 27 v. Samsung Electronics Co., Ltd., 881 F. Supp. 2d 1132, 1150 (N.D. Cal. 2012). 28 When the spoliating party has acted only negligently, the least harsh instruction 1 “permits (but does not require) a jury to presume that the lost evidence is both 2 relevant and favorable to the innocent party.” Id. “If it makes this presumption, 3 the spoliating party’s rebuttal evidence must then be considered by the jury, 4 which must then decide whether to draw an adverse inference against the 5 spoliating party.” Id. 6 III. DISCUSSION 7 Because the Court has already determined that a jury instruction on 8 spoliation is appropriate, the Court addresses only the form of the sanction. 9 1. Degree of Fault 10 Plaintiff argues that Costco acted “willfully and recklessly” by failing to 11 follow its internal policy. (ECF No. 83 at 6.) But Plaintiff does not point to case 12 law indicating that a failure to follow an internal policy constitutes willful or 13 reckless conduct. Plaintiff also suggests that Defendant’s witnesses are not 14 credible when they state that they saw nothing on the floor because it is 15 “undisputed by Mr. Diaz and Ms. Chism that [Chism] had Clif Bars in her hands.” 16 (ECF no. 83 at 6.) The Court does not make credibility determinations at this 17 stage, and Plaintiff’s challenge to Costco employees’ credibility is insufficient to 18 show that Costco acted willfully or recklessly. This factor therefore weighs in favor 19 of a lesser sanction. 20 2.
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1 UNITED STATES DISTRICT COURT
2 DISTRICT OF NEVADA
3 MICHELLE CHISM, Case No. 2:20-cv-00967-ART-DJA
4 Plaintiff, ORDER v. 5 COSTCO WHOLESALE 6 CORPORATION,
7 Defendant. 8 In this personal injury lawsuit, Plaintiff Michelle Chism seeks a spoliation 9 jury instruction (ECF No. 57). The Court previously granted Plaintiff’s request for 10 a spoliation instruction (ECF No. 63) and instructed parties to file supplemental 11 briefing regarding the type of jury instruction. For the following reasons, the 12 Court finds that an adverse inference jury instruction is the appropriate remedy. 13 I. BACKGROUND 14 Plaintiff suffered a severe head injury after slipping at Costo in April 2019. 15 (ECF No. 1 at ¶ 9.) Plaintiff alleges that while she was walking down the aisle, she 16 “encountered a condition that caused her to fall to the floor.” (Id.) Her head injury 17 “required emergency medical attention and hospitalization and has left her with 18 life-long debilitating injuries.” (Id.) She brings two claims: (1) negligence/gross 19 negligence/premises liability; and (2) negligent hiring, supervision, and retention. 20 (ECF No. 1 at ¶¶ 8–23.) 21 Nobody observed the fall. (ECF No. 57-4 at 3.) Plaintiff was with her 22 boyfriend, Eddie Diaz, at the time. (Id.) Diaz told first responders that Chism had 23 been experiencing flulike symptoms for the past few days but had been getting 24 better. (Id.) There is a dispute as to how many cameras covered the area of the 25 fall. According to Jaime Roxanne Morreira, there were at least four cameras 26 providing coverage of the area. (ECF No. 57-13 at 3.) According to Michael Le, an 27 administrative manager at Costco, there was only one camera (ECF No. 57-5 at 28 9.) Costco failed to preserve any of this footage. 1 Michael Le stated in his deposition that he reviewed the video surveillance 2 that day. (ECF No. 55-1 at 92.) He recalled seeing only one camera angle and 3 could not recall exactly where the camera was located. (Id. at 93.) He recalled 4 seeing Plaintiff “walking back and forth” in the aisle that she fell in. (Id.) He 5 recalled that the view was partially obstructed by shelving, and that he saw just 6 “just . . . drop down.” (Id.) The video was recorded over three months after the 7 incident. (ECF No. 72 at 19.) 8 At the time, Costco had a written policy which outlined several steps that 9 should be taken in the event of a member injury or incident. (ECF No. 57-12.) 10 Among other things, the policy instructed members to photograph the area, 11 report the incident, request that the member complete an incident form and write 12 their opinion of the cause on a separate piece of paper. (Id. at 2.) The policy 13 instructed that: “[s]urveillance video must be retained as evidence following a 14 bodily injury incident regardless of whether it captures the incident” and 15 recommended that the record time included “2 hours before and 2 hours after 16 the incident.” (Id.) 17 An incident report was never completed, and Costco did not preserve the 18 surveillance footage. (ECF No. 55-1 at 92.) Eight days after the accident, Mr. Diaz 19 returned to Costco and spoke to Michael Le about “what happened.” (Doc. No. 20 55-1 at 158.) But Plaintiff and Diaz did not otherwise indicate that they were 21 pursuing litigation. (Id.) According to Defendant, Costco did not receive a letter of 22 representation or letter to preserve evidence from Plaintiff’s counsel until several 23 months after the video had been “recycled in accordance with Costco policies.” 24 (ECF No. 85 at 7.) 25 In November 2023, the Court held a hearing on Defendant’s motion for 26 summary judgment and Plaintiff’s motion for spoliation. (ECF No. 72.) The Court 27 denied Defendant’s motion for summary judgment, noting that although 28 Plaintiff’s evidence was weak, there was a proof issue created by Costco due to 1 the lack of video evidence. (Id. at 25.) The Court granted Plaintiff’s motion for 2 spoliation, finding that the requirements of Rule 37(e) had been satisfied: the 3 video should have been preserved in anticipation of litigation, the video was lost 4 because Defendant failed to take reasonable steps to preserve, and the video 5 could not be restored or replaced. (Id. at 26–27.) The Court stated that it would 6 issue a sanction in the form of a jury instruction and allow the parties to brief 7 the appropriate discussion at a later point. (Id. at 28.) That issue is now before 8 the Court. 9 II. LEGAL STANDARD 10 Courts have inherent authority to sanction parties for spoliation of 11 evidence. Leon v. IDX Systems Corp., 464 F.3d 951, 958 (9th Cir. 2006). “In 12 considering what spoliation sanction to impose, if any, courts generally consider 13 three factors: (1) the degree of fault of the party who altered or destroyed the 14 evidence; (2) the degree of prejudice suffered by the opposing party; and (3) 15 whether there is a lesser sanction that will avoid substantial unfairness to the 16 opposing party.” Apple Inc. v. Samsung Elecs. Co., 888 F. Supp. 2d 976, 985 (N.D. 17 Cal. 2012) (cleaned up). Courts should choose “the least onerous sanction 18 corresponding to the willfulness of the destructive act and the prejudice suffered 19 by the victim.” Id. (citation omitted). 20 Courts apply three tiers of sanctions for spoliation with corresponding 21 levels of culpability. In severe cases of bad faith spoliation, a court may strike a 22 spoliating defendant’s answer or enter default judgment on specific issues. See 23 In re Napster Copyright Litig., 462 F. Supp. 2d 1060 (N.D. Cal 2006); see also 24 Peschel v. City Of Missoula, 664 F. Supp. 2d 1137, 1146 (D. Mont. 2009). In the 25 middle tier of culpability, a court may impose a mandatory, rebuttable 26 presumption “when a spoliating party has acted willfully or recklessly.” Apple Inc. 27 v. Samsung Electronics Co., Ltd., 881 F. Supp. 2d 1132, 1150 (N.D. Cal. 2012). 28 When the spoliating party has acted only negligently, the least harsh instruction 1 “permits (but does not require) a jury to presume that the lost evidence is both 2 relevant and favorable to the innocent party.” Id. “If it makes this presumption, 3 the spoliating party’s rebuttal evidence must then be considered by the jury, 4 which must then decide whether to draw an adverse inference against the 5 spoliating party.” Id. 6 III. DISCUSSION 7 Because the Court has already determined that a jury instruction on 8 spoliation is appropriate, the Court addresses only the form of the sanction. 9 1. Degree of Fault 10 Plaintiff argues that Costco acted “willfully and recklessly” by failing to 11 follow its internal policy. (ECF No. 83 at 6.) But Plaintiff does not point to case 12 law indicating that a failure to follow an internal policy constitutes willful or 13 reckless conduct. Plaintiff also suggests that Defendant’s witnesses are not 14 credible when they state that they saw nothing on the floor because it is 15 “undisputed by Mr. Diaz and Ms. Chism that [Chism] had Clif Bars in her hands.” 16 (ECF no. 83 at 6.) The Court does not make credibility determinations at this 17 stage, and Plaintiff’s challenge to Costco employees’ credibility is insufficient to 18 show that Costco acted willfully or recklessly. This factor therefore weighs in favor 19 of a lesser sanction. 20 2. Degree of Prejudice 21 “The prejudice inquiry ‘looks to whether the [spoiling party’s] actions 22 impaired [the non-spoiling party’s] ability to go to trial or threatened to interfere 23 with the rightful decision of the case.’” Leon v. IDX Systs. Corp., 464 F.3d 951, 24 959 (9th Cir. 2006) (quoting Wiltec Guam, Inc. v. Kahaluu Constr. Co., 857 F.2d 25 600, 604 (9th Cir. 1988). In Anheuser–Busch, the court found prejudice when a 26 party’s refusal to provide certain documents “forced Anheuser to rely on 27 incomplete and spotty evidence” at trial. 69 F.3d at 354. 28 Here, the prejudice to Plaintiff is significant. Plaintiff does not have any 1 eyewitness testimony of the fall. She is left with only the testimony of a Costco 2 employee who viewed one video several years ago. Defendant argues that the 3 footage was not relevant because it did not show the condition of the floor. (ECF 4 No. 85 at 11.) But the Court cannot conclude with certainty what the video shows, 5 and there is a dispute as to how many videos existed. According to Mr. Le, the 6 video did show Plaintiff’s fall—albeit an obstructed view of the fall. Without this 7 footage, Plaintiff is forced to rely on incomplete and spotty evidence at trial. This 8 factor therefore weighs in favor of a harsher sanction. 9 3. Lesser Sanction 10 Defendant offers only one alternative to the adverse inference instruction: 11 no instruction. The Court has already determined that an instruction is 12 appropriate and declines to revisit that ruling. An adverse inference instruction 13 is the least harsh of the three tiers of spoliation instructions. 14 4. Appropriate Instruction 15 Accordingly, the Court finds that a sanction in the form of an adverse 16 inference instruction is adequate to address the prejudice suffered by Plaintiff. 17 The Court will order the jury to be instructed as follows: 18 Defendant has failed to prevent the destruction of relevant evidence for Plaintiff’s use in this litigation. This is known as the “spoliation of 19 evidence.” 20 I instruct you, as a matter of law, that Defendant failed to preserve evidence 21 after its duty to preserve arose.
22 You also may presume that Plaintiff has met its burden of proving the 23 following two elements by a preponderance of the evidence: first, that relevant evidence was destroyed after the duty to preserve arose. Evidence 24 is relevant if it would have clarified a fact at issue in the trial and otherwise would naturally have been introduced into evidence; and second, the lost 25 evidence was favorable to Plaintiff. 26 Whether this finding is important to you in reaching a verdict in this case 27 is for you to decide. You may choose to find it determinative, somewhat determinative, or not at all determinative in reaching your verdict. 28 1 || See Minden v. Allstate Prop. & Cas. Ins. Co., No. 221CVO0151APGBNW, 2023 WL 2 || 6542152, at *8 (D. Nev. July 24, 2023) (citing Apple, 881 F.Supp.2d at 1151). 3 || IV. CONCLUSION 4 The Court orders that an adverse inference jury instruction be given as 5 || sanction for the spoliation of evidence as outlined in this order. 6 7 DATED: August 14, 2025 8 Aras plod iden 9 10 UNITED STATES DISTRICT JUDGE 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28