Rockwood, et a l . v . SKF USA, Inc. CV-08-168-JL 9/30/10 UNITED STATES DISTRICT COURT DISTRICT OF NEW HAMPSHIRE
Robert Rockwood and Roxana Marchosky
v. Civil N o . 08-cv-168-JL Opinion N o . 2010 DNH 171 SKF USA Inc.
MEMORANDUM ORDER
The defendant, SKF USA Inc., moves to impose sanctions on
the plaintiffs, Robert Rockwood and Roxana Marchosky, for
allegedly failing to preserve and destroying documents
potentially relevant to this case, which arises out of a failed
deal between the parties for the acquisition of the plaintiffs’
company, Environamics, Inc. SKF asserts that, after the
plaintiffs threatened this lawsuit, they (1) failed to ensure
that the Environamics business records would not be destroyed
following its lender’s foreclosure, repossession of the company’s
assets, and the sale of those assets to a third party, and
(2) replaced the hard drives on laptop computers they used in
connection with company business, then deleted files from those
computers after this court ordered their production in discovery.
Characterizing these transgressions as spoliation and, in
the case of the deleted files, a violation of the court’s discovery order, SKF seeks dismissal of the case.1 This court
has jurisdiction over this matter between the plaintiffs, New
Hampshire citizens, and SKF, a Pennsylvania-based corporation,
under 28 U.S.C. § 1331(a)(1) (diversity).
SKF is entitled to some relief, just not the relief it has
requested. As explained infra, because the record assembled on
the motion does not support SKF’s charges that the plaintiffs
negligently or intentionally destroyed relevant documents, its
request for dismissal is denied. The plaintiffs took steps that
were reasonable under the circumstances to preserve the business
records stored at the Environamics facility and any files stored
on their laptops’ hard drives. And, though Rockwood admits to
having deleted the electronic versions of a handful of documents
that were responsive to SKF’s document requests, he swears that
he did so without realizing that fact, and he has since produced
paper copies of them in any event. Nevertheless, this
intentional deletion of files, combined with Rockwood’s use of
1 SKF’s opening memorandum also requests “the attorneys’ fees and costs it has incurred as a result of Plaintiffs’ discovery abuses,” but it is unclear whether SKF means its expenses incurred in (1) moving to compel the production of the laptops, (2) moving for sanctions, or (3) defending the case in its entirety. And SKF’s reply memorandum states that “dismissal is the only meaningful sanction in this case in light of Plaintiffs’ repeated assertions that they are impecunious.” The court therefore denies SKF’s request for fees and costs as either inadequately presented or waived.
2 file-cleaning software on both his and Marchosky’s laptops after
SKF filed its motion to compel their production, supports drawing
an adverse inference against Rockwood’s credibility as a witness
at any trial on the merits in this matter.
I. Background
SKF, the American subsidiary of a multinational bearing
manufacturer, began distributing products for Environamics, a New
Hampshire-based company that makes industrial pumps, in 2004.
The plaintiffs, Environamics’ sole shareholders, also entered
into an agreement with SKF giving it the option to buy the
company at a price dependent in part on its profits over a
specified period of time in the future.
The plaintiffs allege that, through words and conduct
amounting to a promise that SKF would indeed buy Environamics,
SKF induced them to secure a loan to the company from Wells
Fargo--to be personally guaranteed by the plaintiffs--the
proceeds of which would fund a sales effort for Environamics
products. The plaintiffs claim that, after they did s o , SKF made
only “weak” attempts to sell the products, requiring Environamics
to draw down the entire $3 million available under the loan and,
ultimately, leaving it unable to repay the debt.
3 As the parties’ relationship was deteriorating in December
2005, the plaintiffs threatened suit against SKF. SKF responded,
in relevant part, by asking Rockwood “to preserve and maintain
all documents, including but not limited to electronic
communications, pertaining to the SKF/Environamics business
relationship.” Environamics eventually defaulted on the loan,
and Wells Fargo foreclosed and took possession of the collateral
in September 2007. This included the company’s facilities in
Hudson, New Hampshire, where Environamics’ business records were
stored, both electronically and in paper format.
Rockwood says that, after learning of the foreclosure, he
“expressly informed” Wells Fargo that it needed to preserve these
records, and was assured by Wells Fargo that it would not destroy
them. In a deposition in this case, a Wells Fargo representative
denied that any such communications occurred, but confirmed that
it did not destroy any SKF documents. He also testified that,
following the foreclosure, the plaintiffs asked him for
permission to take documents from the facility, but he refused
because he believed those documents belonged to Wells Fargo at
that point. The plaintiffs were twice given access to the
facility to make copies of Environamics records, but they recall
that they had no more than two hours to do so on either occasion.
4 Rockwood estimates that there were between 1.5 and 2 million
pages of Environamics records stored there in hard copy form.
In January 2007, Wells Fargo sold the repossessed
Environamics assets to Dickow Pumps, Inc., a company based in
Marietta, Georgia. According to Dickow’s representatives, it
went on to destroy “some of the records from Environamics that
were not necessary to continue operating the business,” but
retained “the files related to Environamics’ customers and
sales,” as well as the company’s computers and servers.
The plaintiffs commenced this lawsuit against SKF in March
2008. During discovery, when SKF expressed concerns about the
dearth of documents the plaintiffs had produced in response to
its requests, they reported that Environamics’ business records
had been destroyed following the foreclosure. In response, SKF
asked the plaintiffs to “copy and image the hard-drives” of
laptop computers, bearing stickers identifying them as property
of Environamics, that they had brought with them to depositions
conducted in the case. The plaintiffs refused, asserting that
the computers were their “personal laptops” which they did not
use “for company purposes, except on a very occasional basis.”
SKF then filed a motion to compel, seeking “an order
compelling Plaintiffs to take all reasonable measures necessary
to obtain and produce” the documents it had requested, or to pay
5 SKF’s expenses in getting those documents itself. While the
motion noted SKF’s unheeded request that the plaintiffs produce
the hard drives to their laptops, it principally faulted the
plaintiffs for failing to take steps to duplicate or preserve the
Environamics business records housed at the Hudson facility
before Wells Fargo foreclosed on the loan, or at least before the
Environamics assets were sold to Dickow.
In ruling on the motion, the court (Muirhead, M.J.) refused
to order the plaintiffs to obtain documents from Dickow,
reasoning that SKF could do so itself by issuing a subpoena.
This ruling, however, was “without prejudice to later seeking
costs attributable to any failure to preserve or spoliation” by
the plaintiffs. SKF subsequently served a subpoena on Dickow and
received some 48,000 pages of records in response. SKF
nevertheless says that “it is apparent that many documents had
either been lost in the transition, disposed of by Dickow . . . ,
or had been destroyed by Environamics before it was evicted.”
Judge Muirhead also ordered the plaintiffs to “physically
produce[]” their laptops “so that the hard drive may be mirror-
imaged.” The plaintiffs did so on November 1 3 , 2009, eight days
after the order had issued.
A forensic analyst hired by SKF to examine the laptops noted
that a number of files on Rockwood’s machine had been transferred
6 to the recycling bin on November 7 , 2009, two days after Judge
Muirhead’s order. While the deleted files could not be
recovered, the analyst was able to compile a list of their names,
some of which indicated that they were related to Environamics
business. The analyst also noted that an external flash drive
had been connected to Marchosky’s laptop on November 1 2 , 2009,
the day before it was turned over for imaging, though the analyst
does not say whether any files had been transferred to the drive.
Nor does the analyst say whether any files on Marchosky’s
computer had been recently deleted.
Furthermore, a program called “CCleaner” had been accessed
on Marchosky’s laptop on the same day it was turned over for
imaging, and on Rockwood’s laptop on August 1 2 , 2009, two weeks
after SKF filed the motion to compel. Though the analyst
describes the program as having “the ability to make deleted
files unrecoverable,” he does not say whether it was used for
that purpose on either computer.2
2 The analyst also located a handful of e-mail messages between Rockwood and SKF personnel that SKF says were responsive to its discovery requests, but not produced. This led SKF to file a motion to compel the plaintiffs to provide the passwords to their e-mail accounts, which were maintained through America Online. The parties eventually resolved this motion by stipulating that the plaintiffs would provide their e-mail passwords to SKF’s analyst for the sole purpose of searching their accounts for e-mails dated between October 1 , 2003, and March 9, 2008 which contained certain terms. When this search
7 The plaintiffs do not deny engaging in these activities, but
offer innocent explanations for them. Rockwood says that, after
he was ordered to turn over his laptop, he deleted “certain
documents that [he] believed were not relevant to this litigation
and not responsive to [SKF’s] discovery requests,” but that he
did so only because he “did not want [his] personal information
in the hands of SKF.” He acknowledges, however, that he “should
not have made these deletions,” and the names of many of the vast
majority of the deleted files--as well as Rockwood’s descriptions
of them--suggest that they were related to Environamics business,
rather than personal in nature.3
Yet Rockwood adds that a search of his home has turned up
hard copies of all but eight of the documents he deleted from his
laptop, and that the file names of those eight documents “make it
clear they are not material to this proceeding and not[]
was performed, however, it did not turn up any e-mails dated before November 1 8 , 2004--despite the fact that earlier e-mails from the plaintiffs have been produced in this case already, and despite Marchosky’s deposition testimony that she never deleted any e-mails from her computer. 3 Interestingly, Rockwood describes one of the deleted documents as an article “relating to emails and destroyed evidence saved in connection with” an unrelated lawsuit filed against Environamics.
8 responsive to [SKF’s] discovery requests.”4 Indeed, according to
the plaintiffs, only three of the documents that Rockwood deleted
from his laptop and subsequently located in paper form have any
relevance to this lawsuit, and marginal relevance at that.5 SKF
has not taken issue with these characterizations.
Rockwood further explains that, after Marchosky asked for
his assistance in copying a document from her laptop so she could
work on the document while her computer was in SKF’s possession,
he attached the flash drive to the machine, but was unable to
copy the document. He also noticed that her laptop seemed
“sluggish,” so he ran the “CCleaner” program in an effort to
improve its performance. Rockwood states that he used the
program on his own laptop for the same purpose while SKF’s motion
to compel was pending, as well as on at least one previous
occasion in early 2009. He claims that “it never occurred to
[him] that CCleaner could be used to delete documents nor did
[he] ever seek to use it for that purpose.”
4 The file names of those documents are: (1) “Remington InvestmentTermSheet-EnvironamicsCorporation,” (2) “Valuation ResearchNotesforHearing10-26-05,” (3) “VANASSACOMMITMENTLETTERFOR FUNDING,” (4) “VANESSA FIFTH [1] THIRD.BANK.LETTER 4-07-06 (concorrdenadas),” (5) “VanessaJustImagine_SandFantasy,” (6) “Environamics Employees,” (7) “Ken Holliman poolchick-1,” and (8)“Leone_v_Environamics_Hearing_11-01-05_prep_Notes[4].” 5 Those documents have been produced as exhibits to the plaintiffs’ objection to SKF’s motion for sanctions.
9 Finally, the plaintiffs report that the hard drive on each
of their laptops had “crashed” before SKF had even filed the
motion to compel: Rockwood’s in May 2007, and Marchosky’s in
June 2009. Rockwood reports that he took his laptop to a vendor
(whose name and location he cannot recall), who told him that the
information on the hard drive was unrecoverable, with the
exception of a small number of documents that were transferred to
a new hard drive the vendor installed. Marchosky reports that
she took her laptop to Staples, the office supply store, for
repairs. She recalls that she authorized Staples to perform
“format/recovery” on the laptop, which she understood as
“authorizing that any and all information that could be
recovered[] would be.” Marchosky says that Staples recommended
that she install a new hard drive, without offering to “retrieve”
her old hard drive, and that she authorized that work, which was
completed on June 1 7 , 2009. The plaintiffs have produced a copy
of a Staples work order corroborating this account.6
6 SKF has produced a different version of the work order, obtained through a subpoena issued to Staples. This version states that Marchosky’s hard drive could have been sent to its manufacturer “for clean room possible recovery” at a cost of roughly $1000-$1,500, but that “[t]he customer decided to install a new drive and do a system restore due to the cost.” But this work order bears a “Complete Date” of November 1 0 , 2009, which is clearly inaccurate based on not only Marchosky’s recollection, but also on SKF’s analyst’s report of when a new version of the operating system was installed on the laptop, i.e., June 2009.
10 II. Analysis
SKF argues that the plaintiffs have engaged in spoliation by
(1) failing to ensure that the Environamics business records
stored at the Hudson facility would be preserved following Wells
Fargo’s foreclosure on its loan to the company, (2) replacing the
hard drives on their laptops without attempting to recover the
information stored there, and (3) in Rockwood’s case,
intentionally deleting files from his laptop just before turning
it over for examination. SKF further argues that, by deleting
those files, Rockwood violated Judge Muirhead’s order to produce
the laptop “so that the hard drive may be mirror-imaged.” The
appropriate sanction for this misconduct, SKF maintains, is
dismissal of the case.
As a “companion to” the spoliation doctrine, which “permits
an adverse inference from one side’s destruction of evidence,” a
court has the “inherent power” to sanction a party who has
“improperly altered or damaged” evidence. Sacramona v .
Bridgestone/Firestone, Inc., 106 F.3d 4 4 4 , 446 (1st Cir. 1997).
“The intended goals” of deploying this power are
to rectify any prejudice the non-offending party may have suffered as a result of the loss of evidence and to deter any future conduct, particularly deliberate conduct, leading to such loss of evidence. Therefore, of particular importance when considering the appropriateness of [spoliation] sanctions [are] the
11 prejudice to the non-offending party and the degree of fault of the offending party.
Collazo-Santiago v . Toyota Motor Corp., 149 F.3d 2 3 , 28 (1st Cir.
1998).
While the authorized punishments for spoliation by a
plaintiff include dismissal of the case, the court of appeals has
cautioned that it “views dismissal with prejudice as a harsh
sanction, which runs counter to [its] strong policy favoring the
disposition of cases on the merits.” Id. (quotation marks
omitted). As discussed more fully below, neither the plaintiffs’
fault for the destruction of any relevant documents nor any
conceivable prejudice that SKF could suffer as a result can
justify such a harsh sanction here.
Nevertheless, Rockwood’s intentional deletion of numerous
files (including a number of documents related to Environamics
business) from his laptop just before turning it over warrants
some sanction. Though, again, this conduct did not prejudice SKF
in any way--because it is undisputed that all of the deleted
documents that were relevant to this case have since been
produced in hard copy form--it was a violation of Judge
Muirhead’s order to provide discovery under Rule 37(a) and
therefore punishable by “just orders” under Rule 37(b)(2)(A).
Under the circumstances, the court believes the just sanction is
12 to draw an adverse inference against Rockwood’s credibility as a
witness at any trial in this matter (where the court will be
sitting as the finder of fact).
A. The Environamics business records
To impose sanctions for spoliation, “bad faith is not
essential”; it is enough that “evidence is mishandled through
carelessness, and the other side is prejudiced.” Sacramona, 106
F.3d at 447. As to the destruction of Environamics business
records stored at the Hudson facility, however, SKF has not
convincingly shown either carelessness or prejudice.
SKF argues that it “was unreasonable for Plaintiffs to do
nothing to preserve documents related to this litigation”
following the foreclosure by Wells Fargo, but the record shows
that the plaintiffs did make reasonable efforts toward that end.
While there is conflicting evidence on whether the plaintiffs
asked Wells Fargo not to destroy the Environamics records
(Rockwood testifies that he did, while the Wells Fargo
representative testified that he received no such request), it is
undisputed that Wells Fargo did not in fact destroy them. It is
likewise undisputed that the plaintiffs asked Wells Fargo for
permission to remove records from the facility, but were refused,
13 and that they were ultimately afforded only a few hours’ access
to the records for the purpose of making copies.
Some Environamics business records were destroyed by Dickow
after it purchased the company’s assets from Wells Fargo, but SKF
has not suggested what the plaintiffs might have done to prevent
that from happening. After that sale was completed, in January
2007, the records belonged to Dickow, which--like Wells Fargo
before the sale--would have been under no obligation to share
them with the plaintiffs even had they asked. As SKF itself
points out (in attempting to deflect the plaintiffs’ argument
that SKF, which they had threatened with litigation well before
then, itself “could have sought a court order” requiring Wells
Fargo or Dickow to preserve the records) this lawsuit had not yet
been filed at that point.7 Until that happened, there was no
7 SKF suggests that the plaintiffs “waited until Environamics’ documents were turned over to Dickow Pumps before they initiated this lawsuit.” While that was indeed the sequence of events, there is nothing to connect it to any effort or even hope by the plaintiffs at gaining an advantage in this litigation. To the contrary, Rockwood testified, in essence, that he was surprised to learn that Dickow had destroyed any of the records and that, until the asset sale took place, he continued to hold out hope for regaining control of Environamics by restructuring its debt to Wells Fargo. For that same reason, the plaintiffs did not act unreasonably by failing to copy whatever Environamics records would have been relevant to this lawsuit at any time during the period between when Wells Fargo first threatened to foreclose on the loan and when it finally made good on that threat. In the court’s view, the fact that two and a half years passed between
14 vehicle for the issuance of a subpoena for the documents to
either Wells Fargo or Dickow.
Of course, after this lawsuit commenced, SKF ultimately did
issue a subpoena to Dickow for the Environamics business records,
obtaining some 48,000 pages of documents in response. Though, by
that point, Dickow had already destroyed some Environamics
records “not necessary to continue operating the business,” SKF
has not persuasively shown how the loss of those documents has
prejudiced its defense of this action.
The records that were “most notably” missing from Dickow’s
production, according to SKF, were correspondence between it and
Environamics, which Rockwood has said he kept in a dedicated
file. There is no doubting the relevance of those documents to
this action. Presumably, however, SKF kept its own copies of
that correspondence--it does not suggest otherwise--so the
disappearance of whatever copies had been maintained by Rockwood
would seem to occasion no real prejudice. If anything, the
absence of documented communications with SKF has the potential
those events--while emphasized by SKF--actually supports Rockwood’s stated belief that Wells Fargo would not foreclose on the loan but would attempt to restructure i t . Furthermore, Wells Fargo’s representative testified that the lender gave no additional notice to the plaintiffs before finally taking possession of the facility, because generally “it works better by surprise. You don’t want any of the collateral to disappear.”
15 to hurt the plaintiffs, who have the burden of proving that those
communications amounted to a promise to buy Environamics.8
SKF also claims prejudice from the absence of the
plaintiffs’ communications--either between themselves or with
other Environamics personnel--“that reflected their state of mind
relative to SKF’s obligations or intentions” in purchasing the
company, but there is no reason to believe that such documents
were among those destroyed by Dickow. To the contrary, Dickow
says it retained the Environamics computers and servers, which is
where those communications would likely reside.9
SKF’s argument for spoliation based on the destruction of
certain Environamics records, then, is similar to--and likely
even weaker than--the argument for spoliation rejected in
8 The court appreciates the risk that the plaintiffs may try to use this situation to their advantage, e.g., by favorably characterizing written communications from SKF that have not turned up in discovery, making it impossible for SKF to dispute those characterizations. Should the plaintiffs resort to that tactic at trial, the court will consider granting appropriate relief to SKF at that time. 9 In its reply, SKF points out that, when it used the plaintiffs’ email passwords to access their America Online accounts, they contained no messages prior to November 1 8 , 2004. SKF has not attempted to show, however, that the plaintiffs intentionally deleted those emails, or negligently allowed them to be deleted, after learning of their potential relevance to this case. But it is worth noting that it was 2005 before the plaintiffs even threatened suit against SKF and SKF responded by asking them to preserve all relevant documents.
16 Collazo-Santiago. In that case, a products liability action
against an automobile manufacturer arising out of a traffic
accident, “the plaintiff’s insurance company declared [her]
vehicle a total loss and sold it at public auction” before the
defendant was able to inspect i t . 149 F.3d at 2 8 . In upholding
the district court’s refusal to dismiss the case for spoliation,
the court of appeals reasoned that the plaintiff “neither
maliciously destroyed evidence nor deliberately attempted to
prevent the defendant from inspecting the vehicle.” Id. at 2 9 .
Instead, “the plaintiff’s insurance company sold the car to a
third party without the plaintiff’s knowledge or consent and the
defendant was given the name of the” purchaser but was unable to
locate him. Id. The court of appeals also relied on the fact
that, while inspecting the vehicle may well have revealed facts
helpful to the defense, “evidence as to many of these issues
could also have been attained through other means.” Id.
Here, there is likewise no evidence that the plaintiffs
intentionally destroyed the Environamics business records, which,
like the plaintiff’s vehicle in Collazo-Santiago, were sold to a
third party without their advance knowledge. Moreover, unlike
the defendant there, SKF has not even tried to explain how any of
the documents that were destroyed--as apart from the plaintiffs’
internal communications, which so far as the record reveals were
17 not destroyed--could be relevant to its defense. Here, as there,
neither the plaintiffs’ fault for the destruction of the
potential evidence, nor the prejudice visited upon SKF as a
result, justifies dismissing the case.
B. The information on the plaintiffs’ laptops
SKF also accuses the plaintiffs of spoliation based on their
handling of their laptop computers before producing them as
ordered by the court. First, SKF argues that the plaintiffs
“lost relevant [information] by replacing the hard drives on
their computers after threatening litigation,” electing “not to
have these hard drives forensically restored to recover any lost
information” o r , at a minimum, retaining them so that they could
be turned over to SKF for that purpose. The evidence, however,
does not bear this charge out.
Rockwood says that the vendor who serviced his laptop after
its hard drive “crashed” did attempt to recover information, and
had some limited success in doing s o , transferring the rescued
data to the new hard drive. This is corroborated by the fact
that, as the plaintiffs point out, the forensic analysis of
Rockwood’s laptop turned up documents that had been created
before the new hard drive was installed. Marchosky, for her
part, authorized the vendor who serviced her laptop after its
18 hard drive crashed to perform a “recovery,” and says that the
vendor simply recommended that she install a new hard drive
without offering to “retrieve” her old one. This is corroborated
by a contemporaneous work order from the vendor.10
While, as the plaintiffs acknowledge, “[i]n retrospect . . .
a better practice would have been to preserve the damaged hard
drive” so that SKF could attempt to recover data from i t , there
is no reason to think that Marchosky knew or should have known
that would even be possible, based on the vendor’s advice that
she simply install a new hard drive. On this record, the court
cannot conclude that the plaintiffs intentionally or carelessly
permitted the destruction of whatever relevant documents resided
on their prior hard drives so as to justify dismissal of their
case. See Bryant v . Gardner, 587 F. Supp. 2d 9 5 1 , 968-69 (N.D.
Ill. 2008) (refusing to enter default against defendant for
spoliation based on his continued use of his laptop, causing
10 It is contradicted by the work order obtained from the vendor by SKF, see note 6, supra, but that work order clearly bears the wrong date, and SKF has offered no reason why the court should rely on that document rather than the contemporaneous record. Instead, in a footnote in its reply, SKF explains that it has been “unable” to schedule a deposition of a witness from the vendor to explain the discrepancies, but that it would issue a subpoena for that purpose “[i]f the court deems such testimony is material to resolve this motion.” It is up to SKF, not the court, to decide what evidence it needs to support its allegations that the plaintiffs culpably destroyed relevant information.
19 deleted files to become unrecoverable via automated processes,
“even though it was apparent from the beginning of [the] lawsuit
that the laptop likely contained evidence pertinent to [the]
claims,” because there was “insufficient evidence of bad faith to
warrant” such a harsh sanction).11
Second, SKF argues that Rockwood engaged in spoliation--as
well as a violation of Judge Muirhead’s order that they produce
their laptops--by running the “CCleaner” program on them,
attaching a flash drive to Marchosky’s machine, and deleting
files from Rockwood’s machine, before turning them over to SKF.
But there is no evidence that attaching the flash drive or
running the “CCleaner” program actually resulted in the
destruction of any information on the laptops, relevant or not.
11 The court in Bryant did enter lesser sanctions against the defendant: payment of the plaintiff’s attorneys’ fees and costs in bringing the spoliation motion, including the costs of the forensic examination of the defendant’s computer, as well as an order precluding the defendant from arguing that he did not draft a document that the plaintiff said was a contract between them, but the defendant said he had never seen before. 587 F. Supp. 2d at 969. The court reasoned that “[b]ecause of [the defendant’s] actions, it is impossible to determine whether [his] laptop contained the agreement Plaintiff claims [he] drafted.” Id. Here, though, SKF has not sufficiently presented--or has waived--any request for costs and fees. See note 1 , supra. It also does not appear that the disposal of the plaintiffs’ hard drives directly prevents SKF from negating any of their allegations, as was the case in Bryant. Again, however, should such a situation arise, the court will consider appropriate relief at that time. See note 8 , supra.
20 SKF’s computer analyst says merely that a flash drive is
“the most common and easiest means of transferring files between
computers”; he does not say that Marchosky in fact copied any
files to the flash drive, o r , more importantly, that she went on
to delete those--or any--files from her hard drive. Similarly,
he says that the “CCleaner” software “has the ability to make
deleted files unrecoverable,” but does not say that it was put to
that use on either of the plaintiffs’ laptops; to the contrary,
the analyst was able to recover a list of the files that Rockwood
had deleted from his hard drive before he produced i t .
Of course, as Rockwood admits, he should not have deleted
those documents in the first place. And his asserted
justification for doing so--that he did not want his personal
information falling into the hands of SKF--is difficult to
accept, in light of the fact that the names of the deleted files
and his own descriptions of them suggest that they relate to
Environamics business (if not necessarily any of the issues in
this case). In deleting this information, then, Rockwood acted
carelessly, if not even more culpably than that. He also
violated this court’s order to “physically produce[]” his laptops
“so that the hard drive may be mirror-imaged.”
While the degree of Rockwood’s fault, then, weighs in favor
of a spoliation sanction, the prejudice to SKF is less
21 significant. Based on the list of recycling bin contents
compiled by SKF’s analyst, Rockwood was able to locate copies of
all of but eight of the documents he deleted. SKF has not
questioned the accuracy of Rockwood’s search, nor the plaintiffs’
claim that none of the documents that are still missing, and only
three of the documents that were found, has any potential
relevance to this case.
Instead, SKF points to case law to the effect that “courts
must not hold the prejudiced party to too strict a standard of
proof regarding the likely contents of the destroyed evidence
because doing so allows the spoliators to profit from the
destruction of evidence.” S e . Mech. Servs., Inc. v . Brody, 657
F. Supp. 2d 1293, 1300 (M.D. Fla. 2009) (citing Kronisch v .
United States, 150 F.3d 1 1 2 , 128 (2d Cir. 1998)). That concern
comes into play, however, only when a party’s misconduct prevents
its adversary from learning the contents, and hence the
relevance, of the spoliated evidence. That did not happen here:
despite Rockwood’s actions, SKF’s analyst was able to compile a
list of the deleted files, almost all of which, as it turns out,
still exist in paper form. Thus, SKF is in a position not only
to assess the relevance of the spoliated evidence, but to have
the spoliated evidence (the plaintiffs have offered to produce
the paper copies if SKF wants them). Aside from concerns of
22 delay, which SKF does not raise, there simply cannot be any
prejudice from the destruction of evidence that was later
recovered and offered in discovery.
Yet the spoliation doctrine is concerned not only with
rectifying prejudice, but with deterring similar misconduct in
the future. Collazo-Santiago, 149 F.3d at 2 9 . Moreover, the
misconduct here violated the court’s order granting SKF’s motion
to compel under Rule 37(a), and is therefore punishable under
Rule 37(b)(2)(A), which also does not treat prejudice to the
adverse party as essential to the imposition of sanctions. See,
e.g., Malloy v . WM Speciality Mortg. LLC, 512 F.3d 2 3 , 27 (1st
Cir. 2008). Rule 37(b)(2)(A) authorizes the court to “issue
further just orders” if a party violates an order to permit or
provide discovery, including a number of specified sanctions.
Though drawing an adverse inference against the offending party
is not among them, the list is non-exhaustive, see, e.g., Novak
v . Wolpoff & Abramson LLP, 536 F.3d 175, 177 (2d Cir. 2008), and
the court of appeals has upheld drawing an adverse inference
against a party for disobeying a discovery order, United States
v . Palmer, 956 F.2d 3 , 4 (1st Cir. 1992).
The court believes that, here, drawing an adverse inference
against Rockwood’s credibility as a witness, should he testify at
any trial in this matter, is the appropriate sanction. Two days
23 after Judge Muirhead ordered Rockwood to produce his laptop so
that its hard drive could be mirror-imaged, he essentially
altered the contents of the hard drive by deleting a number of
documents. This was a blatant violation of both the letter and
the spirit of the order.
While Rockwood claims he did this to prevent SKF from
accessing his personal information, he had other, legitimate
means at his disposal to do so (e.g., asking SKF to restrict the
list of keywords used to search the hard drive so as to avoid
encountering those files, or seeking a protective order from the
court, see Fed. R. Civ. P. 26(c)) and, again, that claim is
difficult to accept in light of the fact that many of the deleted
files were business-related. Some sanction is necessary, then,
to serve this court’s “strong institutional interest in ensuring
that litigants honor [its] orders.” Malloy, 512 F.3d at 2 7 .
Drawing an adverse inference against Rockwood effects that goal
while also preserving the judicial preference for the resolution
of cases on the merits, rather than by the application of
sanctions. See Collazo-Santiago, 149 F.3d at 2 9 .
24 III. Conclusion
For the foregoing reasons, SKF’s motion for sanctions12 is
DENIED insofar as it seeks dismissal of the case or the
imposition of attorneys’ fees and costs, but is GRANTED insofar
as the court will draw an adverse inference against Rockwood’s
credibility as a witness at any trial in this matter.
SO ORDERED.
Joseph N. Laplante .ited States District Judge
Dated: September 30, 2010
cc: Donald C . Crandlemire, Esq. Steven M . Gordon, Esq. William E . Aivalikles, Esq. David Richman, Esq. Gregory A . Moffett, Esq. Matthew R. Williams, Esq. Peter G. Callaghan, Esq. Alexander J. Walker, Esq.
12 Document n o . 125.