Davis v. Chatter, Inc.

270 S.W.3d 471, 2008 Mo. App. LEXIS 1564, 2008 WL 4976206
CourtMissouri Court of Appeals
DecidedNovember 25, 2008
DocketWD 69056
StatusPublished
Cited by10 cases

This text of 270 S.W.3d 471 (Davis v. Chatter, Inc.) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Davis v. Chatter, Inc., 270 S.W.3d 471, 2008 Mo. App. LEXIS 1564, 2008 WL 4976206 (Mo. Ct. App. 2008).

Opinion

JAMES M. SMART, JR., Judge.

Defendants Chatter, Inc., David Raine, and Tim Mosolino appeal the judgment entered in favor of plaintiffs George and Suzanne Davis after defendants’ pleadings were struck as a sanction for failure to cooperate with discovery. They make numerous claims on appeal pertaining to the sanctions imposed and the damages awarded. The judgment is vacated as to the compensatory damage award, and the case is remanded to the trial court to specify the portion of the compensatory damages awarded for Count I and the portion awarded for Count II. It is affirmed in all other respects.

Facts

This case arises from an agreement in which the plaintiffs were to have been exclusive sales representatives for a company providing satellite text notifications to public entities needing reliable communications during a crisis. Plaintiff George Davis was an effective and successful sales representative, who, along with his wife Suzanne, was recruited by defendants from other endeavors to promote and develop a sales force for defendant Chatter, Inc.’s services. George and Suzanne Davis were also to receive company stock as part of their compensation for the development of markets for Chatter. Plaintiff George Davis alleged he had invested much time and energy recruiting, hiring and training representatives, and developing markets for defendants, but was never compensated in accordance with the contract. Plaintiffs further contended that defendants tortiously interfered with their contracts with third parties, refused to pay amounts due under the agreement, and caused them substantial damages.

On March 28, 2006, plaintiffs filed a petition for damages alleging breach of contract in Count I, tortious interference with contract in Count II, securities violations (related to the issuance of stock in Chatter, Inc.) in Count III, violation of the Telephone Consumer Protection Act in Count IV, and quantum meruit or unjust enrichment in Count V. Defendants filed a timely answer denying liability and asserting defenses.

Eight months after the case was filed, the circuit court entered a civil case management scheduling order. It set a trial *474 date in eleven months, scheduling it for October 9, 2007, and required discovery to be completed by September 1, 2007. Plaintiffs served defendants with first interrogatories and request for production of documents in July 2007. In August 2007, plaintiffs filed a motion to extend the discovery deadline from September 1, 2007, to October 1, 2007. The motion stated that the three defendants failed to appear for depositions and had not responded to written discovery requests. The court sustained the motion to extend discovery in September 2007. It noted that the trial date remained October 9, 2007.

Plaintiffs filed a motion to enforce discovery on September 12, 2007. The motion was based on defendants’ failure to comply with discovery propounded on July 31, 2007. Defendants did not object to any discovery sought or seek any protective order. No documents responsive to the request were ever produced and no formal answer to the response was filed. Defendants’ interrogatory answers to multiple interrogatories were incomplete and non-responsive. Defendants failed to appear for their depositions scheduled for August 30 and 31. The information sought was financial information regarding sales made during plaintiffs’ employment and after plaintiffs’ sales agreement was improperly terminated.

Plaintiffs also sought information regarding defenses asserted by defendants in their answer and in two prior motions to dismiss or for summary judgment, both of which were denied. On September 7, 2007, plaintiffs sent their “golden letter rule” to defendants. Defendants’ reply was to re-send the same incomplete, evasive, unsigned interrogatory answers and to state that it had supplied the only relevant documents it had and that other documents were not relevant to the case.

Defendants’ counsel moved to withdraw in August 2007 for the reason that counsel was having difficulty communicating with her clients and securing cooperation from them on discovery issues. The motion stated that the individual defendants Raine and Mosolino planned to proceed as pro se litigants. Chatter, Inc., a corporation, was apparently intending to secure new counsel. In September 2007, defendants’ counsel was granted leave to withdraw.

On October 1, 2007, the court set a hearing on the motion for October 5, 2007. Notice was transmitted to the defendants in California. In an October 1 electronic message response to the judge concerning the October 5 hearing, Mr. Raine, who resided in California, stated that he had secured an air ticket to be in Kansas City for trial from the 9th to the 11th, but that he “lacked the financial resources” to be there for the hearing on the 5th. He added that he had fully complied with discovery requests related to plaintiffs’ “frivolous” allegations by supplying whatever he had.

On the 5th, defendants failed to appear at the hearing either by counsel or in person. The court found:

Defendants have failed to respond to the propounded discovery as required by the Missouri Supreme Court Rules, have failed to provide discovery after receipt of counsel’s golden rule letter, have failed to respond to Plaintiffs’ Motion for Enforcement of Discovery and have failed to appear for the hearing on Plaintiffs’ Motion for Enforcement of Discovery.

The court struck the defendants’ pleadings and entered an interlocutory order of default on all counts of plaintiffs’ petition for plaintiffs and against defendants. The court scheduled a hearing for October 9, 2007, to determine the amount of damages *475 to be awarded. Immediate notice was provided to the defendants.

On October 8, Defendant Raine responded by electronic message. He informed the court that he had been “unable to secure the funds to purchase a ticket to Kansas City” for the trial. (We do not know how this related to the statement in his October 1 message that he had already secured a plane ticket to be present in Kansas City on the 9th, with a return flight to California on the 11th.) He requested a one week extension so he could “sell some personal items” to purchase a ticket.

That night, on the eve of the October 9 hearing, defendants engaged new counsel, Mr. Gaines, to appear the next morning in their behalf. Mr. Gaines, who had no opportunity to familiarize himself with the case, entered his appearance the next morning at the hearing. During the hearing, as a part of the court’s sanctions ruling, Mr. Gaines was not allowed to cross-examine the plaintiffs’ witnesses or otherwise participate. He objected to the denial of his participation and was allowed to make a record at the conclusion of all testimony.

The court made extensive comments on the record, pertaining to the sanctions imposed against the defendants. The court saw the issue as primarily one of fairness to the plaintiffs, because the defendants had been extremely recalcitrant and evasive about discovery. The court believed the defendants had followed a deliberate and calculated course of obstruction. The court believed the defendants had made their own bed. The court noted that one' of the reasons that defendants’ original counsel sought to withdraw was her inability to secure cooperation so as to proceed with discovery.

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270 S.W.3d 471, 2008 Mo. App. LEXIS 1564, 2008 WL 4976206, Counsel Stack Legal Research, https://law.counselstack.com/opinion/davis-v-chatter-inc-moctapp-2008.