FILED
SUPEHt:0R COURT
OF GUAM
202'1 APR 12 PM 3: 17
2 CLERK Gf C·OURT
3 4 IN THE SUPERIOR COURT OF G U A M B Y : + - • -
5 DFS GUAM L.P ., CIVIL CASE NO. CV0943-14 6 (Consolidated with CV0094-15 and CV0198-15)
Plaintiff,
7 v. DECISION AND ORDER 8 Re: GIAA and Lotte's Motions for 9 THE A.B. WON PAT INTERNATIONAL Reconsideration AIRPORT AUTHORITY, GUAM, and 10 DOES 1-10, INCLUSIVE. 11 Defendant.
12
13
14 This matter came before the Honorable Arthur R. Barcinas on January 12, 2024, for a
15 hearing on separate motions for reconsideration filed by defendant The A.B. Won Pat 16 International Airport Authority, Guam ("GIAA") and by non-party Lotte Duty Free Guam, LLC 17 ("Lotte"). Each seeks reconsideration of the Court's October 27, 2023 Decision and Order
("October Order"), 1 which resolved a motion2 by plaintiff DFS Guam L.P. 's ("DFS") for 19
20 evidentiary sanctions against Lotte. At the hearing, attorneys Genevieve Rapadas and E. Christian
21 Calvo appeared for GIAA; attorneys Steven Madison and Cesar Cabot appeared for Lotte; and 22 attorneys Jay Srinivasan and G. Patrick Civille appeared for DFS. After the hearing, the Court 23 took the matter under advisement and now issues the following Decision and Order DENYING 24 both motions for reconsideration.
25
26 27 1 The full title of that Decision and Order is "Decision and Order RE: DFS Guam L.P.'s Motion for Order tc
Lotte Duty Free Guam, LLC to Show Cause Why It Should Not Be Held in Contempt for Failing to Comply with th, 28 Court's December 22, 2017 Order" (Oct. 27, 2023).
2 The full title of the motion is "DFS Guam L.P.'s Motion for Order to Lotte Duty Free Guam, LLC to Sho"
Cause Why It Should Not Be Held in Contempt for Failing to Comply with the Court's December 22, 2017 Order'
(Jan. 22, 2018). Herein, that motion shall be referred to as the "January 2018 Motion."
CV0943-14 DFS Guam L.P. v. The A.B. Won Pat International Airport Authority, Guam
I BACKGROUND 2 The Court assumes the parties are familiar with the extensive background of this case, 3 and reincorporates by reference the broader Background recited in the October Order. 4 In its January 2018 Motion, DFS asked the Court to adopt seven adverse inferences 5 against Lotte for Lotte's failure to produce certain documents in discovery. The Court's October 6 Order held, in brief, that (I) Lotte, although no longer a party to this case, nonetheless had a 7 duty to preserve certain evidence, Dec. & Order at 5-6 (Oct. 27, 2023); (2) Lotte's duty to 8 preserve began on May 3, 2013, upon receipt of a certain letter from GIAA, id. at 6-8; (3) and 9 Lotte's failure to preserve documents after receipt of the letter amounted to spoliation of IO evidence, id. at 9. The Court therefore agreed to adopt all seven adverse inferences sought 11 against Lotte. Id. 12 Following the October Order, GIAA and Lotte each moved for reconsideration. GIAA 13 moved for reconsideration on four grounds, and Lotte moved for reconsideration on seven 14 grounds, each of which is addressed below. On December 12, 2023, DFS filed a Combined 15 Opposition which responded to the issues raised by both motions. DFS advanced two primary 16 arguments: (!) none of the issues raised by the movants are appropriate for reconsideration 17 under the relevant rules governing reconsideration, and (2) none of the decisions made in the 18 October Order were erroneous. On December 26, 2023, Lotte filed a Reply, and on December 19 29, 2023, GIAA filed a Reply, each rebutting the counter-arguments made by DFS. 20 DISCUSSION 21 A. Standard for Reconsideration 22 GIAA and Lotte move for reconsideration under three separate rules: Guam Rule of 23 Civil Procedure ("GRCP") 59(e); GRCP 60(b)(6); and Superior Court of Guam Local Civil 24 Page2ofl6
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I Rule ("CVR") 7.l(i). See GIAA Mot. Reconsideration at 2-3; Lotte Mot. Reconsideration at 2- 2 3. The Court must first determine which rule, or rules, apply here. 3 At the outset, a motion cannot be brought simultaneously under GRCP 59(e) and GRCP 4 60(b)(6); the rules are mutually exclusive based on the timing of filing. Thus, "[r]egardless of 5 how it is styled, a post-judgment motion filed within ten days of entry of judgment that 6 questions the correctness of a judgment is properly construed as a Rule 59(e) motion." Sananap 7 v. Cy/red, 2009 Guam 13 ,r 16 (quoting Venable v. Haislip, 721 F.2d 297, 299 (10th Cir. 1983)); 8 accord Harcon Barge Co., Inc. v. D & G Boat Rentals, Inc., 784 F.2d 665, 669-70 (5th Cir. 9 1986) (noting "[ v]irtually every circuit court" has reached this conclusion). Here, both GIAA 10 and Lotte's motions were filed within ten days of entry of the October Order, applying the time- 11 calculation standards of the then-operative GRCP 6. 3 Thus, the Court treats the motions as 12 grounded in GRCP 59(e), not GRCP 60(b)(6). 13 GIAA and Lotte each argue that the October Order was in several respects clearly 14 erroneous and/or manifestly unjust. Generally speaking, "clear error" and "manifest" injustice 15 are valid bases for reconsideration under GRCP 59(e). See DFS Guam L.P v. A.B. Won Part
16 Int'/ Airport Auth., 2014 Guam 12 ,r 21 (hereafter, "DFS I"). However, GRCP 59(e) governs 3 The calculation of time in Guam, for purposes of civil cases, has changed during the course of this 17 litigation. Under the previous version of GRCP 6, "When the period of time prescribed or allowed is less than 11 days, intermediate Saturdays, Sundays, and legal holidays shall be excluded in the computation." GRCP 6, 2023 18 Complier's Note at (a) (emphasis added). GIAA and Lotte each filed their motions on November 14, 2023, which excluding Saturdays, Sundays, and the legal holidays for All Souls Day and Veteran's Day-was the tenth day afte 19 October 27, 2023. However, just eight days before the Court issued the October Order, the Supreme Court of Guam promulgated a new method of calculating time under the GRCP. See Promulgation Order No. PRM06-006-24 (Oct.
19, 2023). Under the now-operative version of GRCP 6, the computation of time now "count[s] every day, 20 including intermediate Saturdays, Sundays, and legal holidays[.]" GRCP 6(a)(l)(B) (emphasis added). Counting "every day," November 14, 2023 is more than ten days after October 27, 2023.
21 The Supreme Court's Promulgation Order provides that the amended rules "shall apply to ... all actions, cases, and proceedings to the effective date hereof and still pending." PRM06-006-24 at 2. However, there is an 22 exception to that rule where "application of the amended Rules ... would not be feasible, or would work injustice, in which event the prior Guam Rules of Civil Procedure ... shall apply." Id. The Court finds that applying the amended version of GRCP 6 here would work an injustice to GIAA and Lotte by denying them the opportunity to 23 raise their motion under GRCP 59(e). The Court will therefore treat the motions as timely filed under GRCP 59(e).
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1 "motion[s] to alter or amend ajudgment." (emphasis added). A "judgment," for purposes of the 2 GRCP, is "a final judgment or an appealable interlocutory order." Cristobal v. Siegel, 2014 3 Guam 16 '1] 12 (citing Guam R. Civ. P. 54(a)). The October Order is not a ''.judgment" under 4 GRCP 59(e) as it is not "the final determination of the rights of the parties" in this case. 7 GCA 5 § 21101; cf Rong Chang Company, Ltd., Inc. v. M2P, Inc., 2012 Guam 1 ,i 19 ("the Motion for 6 Reconsideration only referred to the January Decision and not the Judgment that it supported, 7 rendering the use of GRCP 59(e), which by its text involves 'motion[s] to alter or amend a 8 judgment,' facially inappropriate."). 9 The October Order also does not appear to be an "appealable interlocutory order." A 10 pre-trial order imposing evidentiary sanctions is an interlocutory order. See Dickinson Frozen 11 Foods, Inc. v. FPD Food Processing Solutions Corp., 2020 WL 2841517 * 10 (D. Idaho June 1, 12 2020); Oliver v. Amazon.com Services, LLC., 2023 WL 3597722 * 1 (E.D. Wis. May 23, 2023) 13 (slip copy). But interlocutory orders in Guam are not inherently appealable; they are only made 14 appealable at the discretion of the Guam Supreme Court. 7 GCA § 3108(b); see Shin v. Fujita 15 Kanko Guam, Inc., 2007 Guam 18 ,i 7 ("We generally exercise the policy of strictly limiting [] 16 interlocutory review."). It is therefore not for this Court to determine whether the October 17 Order is an "appealable interlocutory order," but in any case, neither movant has argued that it 18 IS.
19 The Court acknowledges there is some Guam case law suggesting that GRCP 59(e) can 20 be used to analyze non-final orders, notwithstanding the ''.judgment" language in the rule. As 21 GIAA notes, in an earlier appeal from this same case, the Guam Supreme Court noted that it has 22 not held that "a trial court acts erroneously if it chooses to entertain a GRCP 59(e) motion, 23 which concerns a decision rather than a judgment.'" DFS I, 2014 Guam 12 ,i 21. However, 24 Page 4 of 16
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I neither has the Guam Supreme Court held that a trial court acts erroneously if it declines to 2 entertain a GRCP 59(e) motion in this circumstance. And federal courts have held that Federal 3 Rule of Civil Procedure ("FRCP") 59(e)-substantively similar to, and the basis for, GRCP 4 59(e)-does not serve as a basis for reconsideration of an interlocutory order. See, e.g., 5 Broadway v. Norris, 193 F.3d 987,989 (8th Cir. 1999) ("Rule 59(e) motions are motions to alter 6 or amend ajudgment, not any nonfinal order." (emphasis in original)); Motorola Inc. v. J.B. 7 Rodgers Mechanical Contractors, 215 F.R.D. 581, 583 n.1 (D. Ariz. 2003) (citing Balla v. Idaho 8 State Bd. of Corrections, 869 F.2d 461, 466-67 (9th Cir. 1989)). 9 Even assuming GRCP 59(e) applies here, all motions for reconsideration in the Superior 10 Court of Guam are also governed by the standards CVR 7.l(i). That rule provides the 11 following:
12 Motion for Reconsideration. A motion for reconsideration of the decision on any motion may be made only on the grounds of 13 (!) a material difference in fact or law from that presented to the Court before such decision that in the exercise of reasonable diligence could not have been 14 known to the party moving for reconsideration at the time of such decision, or, (2) the emergence of new material facts or a change of law occurring after the 15 time of such decision, or, 16 (3) a manifest showing of a failure to consider material facts presented to the Court before such decision.
17 No motion for reconsideration shall in any manner repeat any oral or written argument made in support of or in opposition to the original motion.
18 CVR 7.l(i). This is a narrower set of circumstances than that provided by Guam's GRCP 59(e)
19 case law; critically, there is no free-standing "clear error" or "manifest injustice" basis for 20 reconsideration in this rule.
21
22 23 24 Page5 of16
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1 CVR 7.l(i) is substantively similar to Local Civil Rule ("L.R.") 7-18 for the Central 2 District of California. 4 Courts in the Central District of California hold that L.R. 7-18 narrows 3 the scope of reconsideration beyond what is provided for in the Federal Rules of Civil 4 Procedure. See, e.g., Lorenzo Vargas v. City of Los Angeles, 2018 WL 10231166 * 2 (C.D. Cal. 5 Nov. 14, 2018) (rejecting pure "clear error" review under L.R. 7-18, explaining that the local 6 rule provides the "exclusive grounds for reconsideration" in that district); Reese v. Verizon 7 California, Inc., 2011 WL 13193419 * 1 (C.D. Cal. Sept. 21, 2011) ("The Local Rules place 8 additional limitations on motions for reconsideration."). The Court finds that CVR 7.1 (i) 9 similarly narrows the basis for reconsideration in Guam. Accordingly, it is not sufficient for the 10 movants here to simply argue "clear error" or "manifest injustice" under GRCP 59(e); such 11 arguments must be tied to one of the three pennissible bases for reconsideration under CVR 12 7.l(i), 13 B. None of These Issues Meet the CVR 7.l(i) Standard 14 The two motions for reconsideration have placed eleven issues before the Court, 15 although there is crossover on some of the issues. At the outset, the Court finds that none of the 16 movants' arguments implicate CVR 7.l(i)(l) or CVR 7.l(i)(2). With respect to CVR 7.l(i)(l), 17 none of the arguments present "a material difference in fact or law from that presented to the
18 4 Central District of California, Local Civil Rule 7-18 provides:
19 A motion for reconsideration of an Order on any motion or application may be made only on the grounds of (a) a material difference in fact or law from that presented to the Court that, in the 20 exercise of reasonable diligence, could not have been known to the party moving for reconsideration at the time the Order was entered, or (b) the emergence of new material facts or a 21 change of law occurring after the Order was entered, or (c) a manifest showing of a failure to consider material facts presented to the Court before the Order was entered. No motion for 22 reconsideration may in any manner repeat any oral or written argument made in support of, or in opposition to, the original motion.
23 Since this rule is substantively similar to CVR 7. l(i), the Court finds Central District of California cases interpreting L.R. 7-18 to be persuasive authority for interpreting CVR 7.l(i).
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1 Court before such decision that in the exercise of reasonable diligence could not have been 2 known to the party moving for reconsideration at the time of such decision." Neither GIAA nor 3 Lotte present any "new" facts relevant to these issues, nor any heretofore unknown precedent, 4 that could not have been presented to the Court prior to October 27, 2023. With respect to CVR 5 7.l(i)(2), none of these arguments suggest "the emergence of new material facts or a change of 6 law occurring after the time of such decision." Neither movant has presented any new facts or 7 new precedential decisions arising only after October 27, 2023. 8 Thus, only CVR 7.l(i)(3) may be at issue here-a "manifest showing" that the Court 9 "fail[ ed] to consider material facts" in reaching the decisions in the October Order. However, 10 this prong of CVR 7. 1(i) must be read in conjunction with the rule's subsequent command that 11 "[n]o motion for reconsideration shall in any manner repeat any oral or written argument made 12 in support of or in opposition to the original motion." CVR 7.l(i). Reading the rule as a whole, 13 it is clear that "[a] party's mere disagreement with the court's application of law to facts is not a 14 'manifest showing ofa failure to consider material facts' by the court." Haitayan v. 7-Eleven, 15 Inc., 2020 WL 3213816 * 2 (C.D. Cal. May 18, 2020); accord Pegasus Satellite Television, Inc. 16 v. DirecTV, Inc., 318 F. Supp. 2d 968,981 (C.D. Cal. 2004) ("a motion for reconsideration may 17 not be made on the grounds that a party disagrees with the Court's application of legal 18 precedent."). 19 I. Adverse Inference Sanctions Under GRCP 37 and 45 (GIAA Issue #1) 20 GIAA argues that adverse inference sanctions against a nonparty are not permitted under 21 the Guam Rules of Civil Procedure. GIAA first asserts that the authority to impose discovery 22 sanctions derives from GRCP 37(b)(2), but notes that this rule speaks only of sanctions against 23 "a party." GIAA Mot. Reconsideration at 5-6. GIAA then asserts that discovery non- 24 Page7 of16
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1 compliance by a non-party would fall under the scope of GRCP 45(e), which allows the Court 2 to make a contempt finding against the non-party but does not permit other sanctions. Id. at 6. 3 GIAA concludes that GRCP 37 and GRCP 45 do not contemplate, and thus do not allow, the 4 imposition of adverse inference sanctions against a non-party. See id. at 6-7. 5 While this analysis of GRCP 37 and GRCP 45 may be valid, the Court did not rely on 6 those rules to impose its adverse inferences. The Court instead relied on its inherent power to 7 make evidentiary rulings. See Dec. & Order at 4 (citing Turner v. United States, 736 F.3d 274, 8 281 (4th Cir. 2013)); cf In re NA., 2001 Guam 7 ,r 48 (recognizing trial courts have "inherent 9 power" which includes "the broad discretion to make evidentiary rulings that will facilitate the 10 'orderly and expeditious disposition of cases."'). The power to make such rulings extends to the 11 imposition of adverse inferences. See, e.g., Leon v. !DX Systems Corp., 464 F.3d 951, 958 (9th 12 Cir. 2006) (noting "the inherent power of federal courts to levy sanctions in response to abusive 13 litigation practices," including evidentiary sanctions); see also Apple Inc. v. Samsung 14 Electronics Co., Ltd., 888 F. Supp. 2d 976, 985-86 (N.D. Cal. 2012) (collecting cases). And it 15 may, in some cases, extend to the imposition of adverse inferences even against non-parties. 16 See, e.g., Glover v. BIC Corp., 6 F.3d 1318, 1329 (9th Cir. 1993) (recognizing court's "broad 17 discretionary power to permit a jury to draw an adverse inference . . . against the party or 18 witness responsible for that behavior" (emphasis added)); Pettit v. Smith, 45 F. Supp. 3d 1099 19 (D. Ariz. 2014) (applying sanction to non-party where unique relationship between non-party 20 and party was present); Ramos v. Swatzell, 2017 WL 2857523 * 6 (C.D. Cal. June 5, 2017) ("A 21 non-party's spoliation of evidence may be imputed to a party who did not engage in 22 spoliation."). Because the Court did not rely on GRCP 37 and/or GRCP 45, and did not need to, 23 the Court denies reconsideration of the applicability of those rules. 24 Page 8 ofl 6
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1 2. Interpretation of Pettit v. Smith (GIAA Issue #2; Lotte Issue #6) 2 Both GIAA and Lotte argue that the October Order incorrectly analogizes this case to 3 Pettit v. Smith, 45 F. Supp. 3d 1099 (D. Ariz. 2014). GIAA argues that the non-party in Pettit 4 had a "special relationship" to the party and control of the party's evidence, GIAA Mot. 5 Reconsideration at 7, while Lotte characterizes the non-party in Pettit as "an agent under the 6 control of the actual party to the lawsuit." Lotte Mot. Reconsideration at 13. The thrust of both 7 arguments is that Lotte and GIAA are not closely connected in the same way that the non-party 8 and party were in Pettit, so extending the logic of that case here is erroneous. 9 This is re-argument of a pure question of law (whether a particular case from another 10 jurisdiction has persuasive value) that has already been decided by the Court, and it does not 11 present a "manifest failure to consider material facts" under CVR 7.l(i)(3). As noted above, "a 12 motion for reconsideration may not be made on the grounds that a party disagrees with the 13 - Court's application of legal precedent." Pegasus Satellite Television, 318 F. Supp. 2d at 981; see 14 also Ross v. Morgan Stanley Smith Barney LLC, 2013 WL 12372144 * 3 n.5 (C.D. Cal. Oct. 7, 15 2013) (a party's "dissatisfaction with the Court's decision, or even disagreement with the Court's 16 reasoning, are not grounds for reconsideration."). The Court is not inclined to reconsider a 17 question of law already decided and therefore denies reconsideration on this issue. 18 3. Shifting Burden of Persuasion (GIAA Issue #3) 19 GIAA argues the October Order has the effect of shifting the burden of persuasion on 20 certain issues from DFS, the plaintiff, to GIAA, the defendant and that this is manifestly unfair 21 to GIAA because they are blameless in the matter of Lotte's non-production. See Lotte's Mot. 22 Reconsideration at 9. GIAA argues that the Court's adverse inferences effectively "pre-judged 23 the merits of the case," id. at 10, which violates "GIAA's due process rights to a fair trial," id. at 24 Page9ofl6
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I 9. GIAA thus appears to argue that the Court manifestly failed to consider the fact that adverse 2 inferences could impact GIAA's trial strategy. However, the Court did not fail to consider this 3 fact; it simply ruled in favor ofDFS on the issue. 4 The Court does not and cannot know yet precisely how either party intends to litigate 5 this case at trial. However, while the Court agrees with DFS that the adverse inferences are 6 relevant to DFS 's causes of action, it is not clear to the Court that any of the adverse inferences 7 are highly probative on the essential elements of DFS 's causes of action, or are harmful to any 8 of GIAA's potential defenses. These adverse inferences relate to what Lotte intended, but 9 Lotte's intent is not an element of any of DFS 's claims against GIAA, which is all that is at issue IO in this case. As GIAA notes, it should not matter (for example) what Lotte intended to 11 accomplish with its November 29, 2012 presentation if GIAA did not violate the law as a result 12 of that presentation. See GIAAMot. Reconsideration at 10. The alleged prejudice GIAA would 13 suffer from the introduction of adverse inferences against Lotte is therefore not apparent to the 14 Court, at least not to a level that would effectively "pre-judge the merits" of the case against 15 GIAA. 16 To the extent GIAA argues that imposing adverse inferences violates a defendant's due 17 process rights due to unfair burden-shifting, the Court is unpersuaded. GIAA has provided no I8 case law supporting that specific contention, nor a legal test by which to analyze this claim. In 19 the criminal context, evidentiary rulings violate due process only where "the absence of 20 [fundamental] fairness fatally infected the trial; the acts complained of must be of such quality 21 as necessarily prevents a fair trial." People v. Mendiola, 2023 Guam 12 ,i 18. The Court does 22 not believe its adverse inferences against Lotte have that kind of effect here. The Court 23 therefore denies reconsideration on this issue. 24 Page 10 of 16
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1 4. Findings on Unexhausted Claims (GIAA Issue #4) 2 GIAA asserts, correctly, that the Guam Supreme Court has already entered judgment 3 against some of DFS 's initial claims because DFS failed to administratively exhaust those 4 claims. Lotte's Mot. Reconsideration at 12 (citing DFS Guam, L.P. v. A.B. Won Pat Int 'l Airport 5 Auth, 2020 Guam 20 ,r 50 (hereafter, "DFS /I")). This includes DFS 's "claims against GIAA 6 related to any 'success fee' paid by Lotte." Id. From this, GIAA argues the Court went beyond 7 its jurisdiction, as prohibited by DFS I, in drawing an adverse inference that Lotte "intended to 8 pay success fees" to two individuals. Id. (quoting Dec. & Order at 9 (Oct. 27, 2023)). 9 The Court did not fail to consider the DFS II decision on the issue of success fees; it IO simply does not read that decision as expansively as GIAA does. The Court agrees that DFS II 11 decided the causes of action based on success fees, see 2020 Guam 20 ,r 50, but it does not read 12 the decision to prohibit the introduction of any evidence related to those alleged fees. That issue 13 is simply not addressed in DFS II. The Court also does not read DFS I to prohibit evidence 14 regarding success fees. DFS /held that this Court did not "have the power to decide or opine on 15 any merits issue" after finding it had no jurisdiction over the case. See 2014 Guam 12 ,r 14. 16 Here, however, in granting adverse inferences, the Court is not "deciding" or "opining" on the 17 merits of already-decided claims. The Court is simply allowing adverse inferences to serve as 18 one piece of evidence relevant to other, still-live claims. The Court does not read DFS I to 19 speak on, much less prohibit, this action. 20 DFS has argued that the success fee evidence is relevant to their broad theory that Lotte 21 had an "improper influence" on GIAA, and that this alleged influence affected GIAA's 22 decisions which are at issue in DFS 's remaining causes of action. DFS Combined Opp. at 19 23 (Dec. 12, 2023 ). The Court has already found that evidence of success fees meets the low 24 Page 11 ofl6
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1 threshold necessary to establish relevance for DFS 's surviving claims. Dec. & Order at 8-9; see 2 Guam R. Evid. 401; People v. Perez, 2015 Guam 10 'if 40 (noting that the standard for relevance 3 under Guam Rule of Evidence 401 "was intended to be minimally stringent."). Whether DFS's 4 overarching theory is probative for their remaining causes of action remains to be seen, but that 5 must be determined at trial, not in this motion. The Court will not reconsider this issue here. 6 5. Lotte's Claim of Compliant Production (Lotte Issue #1) 7 Lotte argues the October Order clearly erred by finding that Lotte failed to produce 8 certain documents. Lotte maintains that it produced all the requested documents in its 9 possession, and notified the Court that it did so. Lotte Mot. Reconsideration at 3-4 (citing 10 Notice to Court re Compliance (Jan. 8, 2018)). However, Lotte raised this same argument in its 11 Opposition to the January 2018 Motion, as well as its Opposition to DFS's October 2017 12 Motion. The Court has considered this core argument, along with the evidence presented by 13 both parties and Lotte on this issue, and ultimately ruled that Lotte did not produce all that it 14 was required to. See Dec. & Order at 6-7. Since a motion for reconsideration may not "in any 15 manner repeat any oral or written argument made in support of or in opposition to the original 16 motion," CVR 7.l(i), the Court denies reconsideration on this issue. 17 6. Documents Did Not Exist as of May 3, 2013 (Lotte Issue #2) 18 Lotte argues that even if the Court correctly held that Lotte was on notice to preserve 19 documents as of May 3, 2013, the conclusion that this required Lotte to produce documents 20 dating to May 3, 2010, was erroneous. Lotte Mot. Reconsideration at 4. Lotte cites a variety of 21 reasons for this position, including(!) DFS did not request documents produced back to May 22 2010; (2) The Request for Proposals (RFP) at issue in this case was not issued until July 2012; 23 (3) Lotte was not fonned until September 2012; and (4) Lotte's internal practice was to delete or 24 Page 12 ofl6
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1 destroy internal documents related to a bid shortly after a bid is finalized, so nothing from the 2 bid process would have remained in existence as of May 3, 2013. Id. at 4-5. Again, however, 3 Lotte has raised this core argument in its Opposition to the January 2018 Motion, and the Court 4 has rejected it upon consideration of all the evidence presented. See Dec. & Order at 6-7. Thus, 5 since this argument has already been raised and rejected, the Court denies reconsideration on 6 this issue. 7 7. Lack of Prejudice to DFS (Lotte Issue #3) 8 Lotte argues, under the Guam Supreme Court's decision in People v. Bosi, 2022 Guam 9 15, that before imposing discovery sanctions, a court must analyze whether the discovery issue IO prejudiced the affected party and impose the "least severe sanction" that will achieve "prompt 11 and full compliance with the court's discovery orders." Lotte Mot. Reconsideration at 7. Lotte 12 therefore argues that the Court erred in failing to analyze whether DFS could have (or did) 13 obtain the materials sought from other sources, or whether DFS 's trial preparation was harmed 14 by impacted by the spoliation. Id. at 7-8. Lotte also argues the Court erred in failing to analyze 15 whether a lesser sanction would have cured whatever prejudice DFS may have suffered. Id. at 16 8. 17 The Court disagrees with Lotte's application of Bosi to these facts. Setting aside the fact 18 that Bosi is a criminal case turning on the interpretation of criminal discovery statutes (8 GCA § 19 70.10 et seq.) not relevant here, the fundamental problem in Bosi was that the People of Guam 20 failed to disclose a potentially prejudicial piece of evidence to the defense until trial had already 21 begun. See 2022 Guam 15 ,i 65. After observing that the trial court had(!) not sanctioned the 22 People despite the violation of the discovery order and (2) not made a clear record of that 23 decision, the Guam Supreme Court decided it was necessary, under the applicable standard of 24 Page 13 of 16
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1 review, to defer to the trial court's discretion. See id. ,r,r 66-71, see also id. ,r 71 n.8 ("Our 2 decision today should be read to vindicate the discretion of the trial court, not to excuse dilatory 3 conduct by the People."). Bosi therefore supports the October Order insofar as the Court's 4 imposition of adverse inferences is also an exercise in discretion. 5 Moreover, it is true that under Bosi, a court should consider "the prejudice, if any, to the 6 opposing party" before sanctioning a party for non-compliance with discovery obligations. Id. ,r 7 68 (quoting People v. Tuncap, I 998 Guam 13 ,r 25). Indeed, the Court has considered the issue 8 of prejudice here-the conclusion that Lotte's nonproduction was prejudicial to DFS undergirds 9 the entire October Order. See Dec. & Order at 5 (Oct. 27, 2023) (explaining that "spoliation 10 relevant to proof of an issue at trial" can support adverse inferences); id. at 8-9 (noting "the fact 11 that the destroyed documents were pertinent to [DFS 'sl protest"). "Spoliation of evidence 12 causes prejudice when, as a result of the spoliation, the party claiming spoliation cannot present 13 'evidence essential to its underlying claim."' Victor Stanley, Inc. v. Creative Pipe, Inc., 269 14 F.R.D. 497, 532 (D. Md. 2010). The Court has found that DFS cannot present evidence that 15 DFS believes is essential to its claims because Lotte failed to produce that evidence, and is not 16 inclined to revisit that finding. This amounts to prejudice. The Court therefore denies 17 reconsideration of this issue. 18 8. Lack ofldentification of "Likely Existed" Documents (Lotte Issue #4) 19 Lotte argues that DFS has failed to prove that certain documents it sought "existed or 20 even likely existed," and that this precludes a spoliation finding as a matter of law. See Lotte 21 Mot. Reconsideration at 9-12. Lotte thus argues the Court erred in finding that Lotte 22 "intentionally spoliated relevant documents," id. at I 0, because there was no effort by DFS to 23 "specifically identify which documents or even categories of documents were allegedly 24 Page 14 of16
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1 destroyed by Lotte," or to "cite any evidence supporting that conclusion." Id. at 11. The Court 2 finds this argument to largely overlap Lotte's argument above that the documents DFS sought 3 did not actually exist. And as with that argument, this argument has already been raised and 4 argued in Lotte's earlier Opposition. The Court therefore denies reconsideration of this issue. 5 9. Adverse Inferences "Unrelated" to Issues in This Litigation (Lotte Issue #5) 6 Lotte argues that the October Order "fails to explain how the seven adverse inferences 7 issued against Lotte relate to the issues remaining in [this case]." Lotte Mot. Reconsideration at 8 12. Lotte argues, in effect, that the scope of the case has been narrowed by the Guam Supreme 9 Court, such that any questions related to Lotte's subjective intent in making its bid are irrelevant 10 to evaluating GIAA's actions. See id. Thus, in Lotte's view, adverse inferences against Lotte 11 are inappropriate as a matter of law because they lack "any connection to live disputes." Id. at 12 14. This argument largely overlaps with GIAA's fourth argument regarding evidence of success 13 fees; as above, the Court has already found that the evidence is at least minimally relevant to 14 DFS 's remaining claims. Again, the Court has not determined whether that theory has actual 15 merit-that is an issue for trial. At this time, however, the Court denies reconsideration of the 16 issue. 17 10. Sanction Issue Should be Decided Elsewhere (Lotte Issue #7) 18 Lotte argues that the October Order was erroneous because Lotte is not a party to this 19 action, and that the issue of sanctions, if it need be decided at all, should be decided in the 20 separate tort case between DFS and Lotte. Id. at 13-14. 21 First, as noted above in Section (B)(l ), the Court did not impose sanctions under GRCP 22 37, but under its inherent power "to make evidentiary rulings that will facilitate the 'orderly and 23 expeditious disposition of cases."' In re NA., 2001 Guam 7 ,i 48. Moreover, the Court's 24 Page 15 ofl6
CV0943-14 DFS Guam L.P. v. The A.B. Won Pat International Airport Authority, Guam
1 purpose in imposing adverse inferences against Lotte was not to punish Lotte-it was to remedy 2 a discovery violation that deprived evidence ofDFS they were entitled to access for their claims 3 in this case. In other words, the Court's purpose in imposing adverse inferences was 4 evidentiary in nature. Cf Kronisch v. United States, 150 F.3d 112, 126 (2d Cir. 1998) 5 (recognizing a "remedial rationale" for adverse inferences to "serve the function, insofar as 6 possible, of restoring the prejudiced party to the same position he would have been in absent the 7 wrongful destruction of evidence by the opposing party."). Litigating the sanctions issue within 8 a different case would not remedy the evidentiary gap that exists in this case because Lotte did 9 not comply with discovery obligations. Accordingly, the Court denies reconsideration on this 10 issue as well. 11 CONCLUSION 12 Based on the above analysis, the Court DENIES GIAA's motion for reconsideration and 13 Lotte's motion for reconsideration.
14 SO ORDERED _ _A_PR_1_2_20_24_ _ 15
16
17 HONORABLE ARTHUR R. BARCINAS 18 Judge, Superior Court of Guam
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