By its Renewed Motion for Sanctions (Doc. 212), Plaintiff complains of discovery abuses by the so-called “Chinese Defendants,” now identified as David Ren, HTRD Group Hong Kong Limited (HTRD), Beijing Ryzur Axiom Medical Investment Co., Ltd. (Beijing Ryzur), and Anhui Ryzur Axiom Medical Equipment Co., Ltd. (Anhui Ryzur), and according to Plaintiff, Ryzur Medical Group a/k/a Beijing Rong Da Shun Da Trading Co., Ltd., d/b/a Ryzur Medical (RMG).[3] Axiom seeks an Order striking these Defendants' pleadings and entry of judgment against each. It contends that prior to the Court's November 30, 2012 Order, these Defendants had not responded to interrogatories or requests to produce, and even after entry of the Order and prior to the next discovery hearing on January 17, 2013, they produced only six pages. Thereafter, Mr. Ren was deposed on February 25 and 26, 2013, individually and as the corporate representative of the Chinese entities. While some documents were produced at the deposition,[4] Axiom complains that neither Mr. Ren nor the other Chinese entities have produced documents or information responsive to many of the categories indicated in the November 30, 2012 Order.[5] By Axiom's account, Defendants have failed to supply documents and e-discovery revealing the chain of distribution and the actual distribution of the DRX parts or products from China to Excite Medical for further sale. Nor does it have meaningful and reliable financial documents reflecting such commerce.

*2 By their response (Doc. 215), the Defendants urge that Plaintiff places too broad a reading on the November 30, 2012, Order and in any event, since entry of the Order, Excite Medical and Mr. Musallam have made a good faith effort to comply. It argues that Axiom has sufficient facts to allow it to respond to the summary judgment motions and to calculate its damages, and further that “Axiom has not been prejudiced in any way that cannot be corrected by the limited sanction of an evidentiary presumption.” (Doc. 215 at 1). Defendants contend that the discovery responses in this case were appropriately delayed until October 2012 when a confidentiality order was finally entered. Moreover, they have not violated the Court's Order by not producing matters that do not exist or which they do not possess. They urge further that there is no evidence that the Chinese Defendants have ever had possession of any of Axiom's computer servers which were indisputably physically transferred to Excite Medical's possession as a consequence of the ABC proceedings. Thus, the claim that the Chinese Defendants have wrongfully denied Axiom access thereto is without merit.

On the matter of sanctions, the Chinese Defendants assert that because Plaintiff has sufficient discovery to allow a response to the outstanding motions for summary judgment and for calculation of its damages,[6] a sanction striking their pleadings and awarding a default judgment against them is unwarranted. They suggest that the more appropriate sanction for their failure to produce documents and information pertaining to their business activities in China and here in the United States is an adverse evidentiary presumption in opposition to their extraterritorial jurisdiction argument. Thus, they propose an evidentiary presumption “that Anhui Ryzur has acted for [HTRD's] benefit by shipping parts for the manufacture of the DRX9000 to [Excite] and doing the necessary paperwork to allow those parts to clear customs in either country” should relieve Plaintiff of any prejudice caused by their failure to produce documents within the Court's Order.[7] (Doc. 215 at 7-8). In that event, the Court will be able to resolve the jurisdictional question raised by the motions.

Upon consideration, to the extent that Plaintiff seeks sanctions for the failure to comply with its discovery requests, the argument is not well-taken. Defendants correctly note that Axiom never chose to litigate by way of motion(s) to compel the particular objections raised by the Defendants in their responses to Axiom's discovery, and thus the sanctions sought for the allegedly untimely and incomplete responses to Axiom's discovery requests are unwarranted. That said, Mr. Ren and his related entities have failed to fully comply with the Court's November 30, 2012 Order, which clearly identified categories of discovery made relevant by the pleadings and arguments presented.

By my reading of his deposition, the proffered exhibits and from arguments made to the Court, it is clear that the “Chinese Defendants” have not produced documents which they could have produced related to assets purchased from Progress Bank, FDA-related records, documents regarding registration of Axiom trademarks in America, design drawings, contracts, purchase orders, invoices and shipping documents for their pertinent activities within China and in the United States, copies of matters obtained from Axiom's computer server(s), complete testimony concerning pertinent websites, and complete financial records for Anhui Ryzur and HTRD. Each of these matters is fairly within the discovery ordered by the Court in its November 30, 2012 Order. By Mr. Ren's account, he assumed many such matters would be produced by others, including his counsel or Excite Medical and Mr. Musallam. While he claimed to have produced all that he had, it is apparent that he made no effort to ensure that HTRD or Anhui Ryzur, nor any other entity over which he maintains control, provided documents responsive to the Court's Order which could have been produced. Even after promising at his belated deposition that upon his return to China he would collect up some of the missing matters and forward them, he has failed to do so. Thus, Mr. Ren concedes some non-production; feigns ignorance that other relevant matters were not produced; and claims that others should have produced them. However, it appears that the better explanation for this non-disclosure is that Mr. Ren simply chose not to make any effort to produce matters ordered by the Court or otherwise appropriate under the discovery requests. His counsel has repeatedly assured the Court that he has advised Mr. Ren of his discovery obligations and of the Court's Order and its concerns. Apart from citing cultural differences as a possible culprit, counsel essentially concedes the substantial non-production and offers no good excuse for the failure of these defendants to fully participate in discovery. In sum, I find that the non-disclosure of relevant discovery by the Chinese Defendants was wilful rather than negligent, and thus, worthy of sanctions.

*3 Courts are given broad discretion in fashioning appropriate sanctions for violations of discovery orders. Malautea v. Suzuki Motor Co., Ltd., 987 F.2d 1536, 1542 (11th Cir. 1993). Federal Rule of Civil Procedure 37(b)(2)(A) authorizes a court to render default judgment against a party that fails to obey an order to provide or permit discovery. Fed. R. Civ. P. 37(b)(2)(A). However, violation of a discovery order which is due to a party's negligence, misunderstanding or inability to comply will not justify a Rule 37 default judgment or dismissal. See In re Chase & Sanborn Corp., 872 F.2d 397, 400 (11th Cir. 1989). “The severe sanction of dismissal or default judgment is to be used only as a last resort and when less drastic sanctions would not be able to ensure a party's compliance with the court's order.” Sussman v. Salem, Saxon & Nielsen, P.A., 154 F.R.D. 294, 298 (M.D. Fla. 1994) (citing Navarro v. Cohan, 856 F.2d 141, 142 (11th Cir. 1988)). Thus, in order to impose such extreme sanctions, the party's noncompliance must be “due to willful or bad faith disregard of court orders which cannot reasonably be expected to be remedied by lesser but equally effective sanctions.” EEOC v. Jacksonville Shipyards, Inc., 690 F. Supp. 995, 998 (M.D. Fla. 1988) (citing Adolph Coors Co. v. Movement Against Racism & the Klan, 777 F.2d 1538, 1542-43 (11th Cir. 1985)).

The specific sanctions sought by Axiom - an order striking the Chinese Defendants' pleadings and directing entry of default judgments against them - goes too far.[8] Two other sanctions appear more apropos to the circumstances. Despite its diligent and costly efforts, Plaintiff (and the Court) are left in the dark concerning these Defendants' pertinent operations in China and the United States. In this regard, the Chinese Defendants seek to exploit their lack of production by contending on a pending motion for summary judgment that they are beyond the reach of the Lanham Act. Specifically, they contend that “[t]here is no evidence that the Chinese Companies have used marks belonging to Axiom in commerce affecting the United States. In fact, James Gibson doesn't have any evidence of the Chinese Companies doing anything outside of China.” (Doc. 152 at 13). The accuracy of these assertions is debatable in light of other evidence. However, even assuming such assertions are accurate, the purported lack of evidence is a direct product of the Chinese Defendants' failure to participate fully in discovery and they cannot be permitted to benefit from their non-disclosure in this way. In light of this, the Court should give these factual assertions by Defendants little, if any, weight on the motion for summary judgment. Beyond that, I recommend that the Court interpose an evidentiary presumption to the contrary, that is, an evidentiary presumption that Mr. Ren and his Chinese entities do conduct relevant business with entities in the United States and have used the disputed marks and copyright matters in commerce affecting the United States sufficiently to bring them within the reach of the Lanham Act. Further, the Chinese Defendants may not rely on any matter to rebut this presumption apart from that which they have produced in discovery.

*4 Additionally, Mr. Ren and his Chinese Companies are subject to monetary sanctions for the costs and legal expenses to Plaintiff necessitated by their failure to timely comply with the Court's November 30, 2012 Order. Within fourteen (14) days, Plaintiff shall submit for the undersigned's consideration an affidavit outlining costs and fees incurred in relation to the prosecution of this renewed motion and the related discovery.

For the foregoing reasons, it is recommended that Axiom Inc.'s Renewed Motion for Sanctions (Doc. 212) be granted in part.