FUNAI ELECTRIC COMPANY, Plaintiff, v. DAEWOO ELECTRONICS CORPORATION, et al., Defendants No. C 04-1830 CRB (JL) United States District Court, N.D. California Signed March 29, 2007 Filed March 28, 2007 Counsel Archana Ojha, Law Offices of Archana Ojha, Gregg Paris Yates, Morgan, Lewis & Bockius LLP, San Francisco, CA, Bernard Hon-Wei Chao, Chao Hadidi Stark & Barker LLP, Menlo Park, CA, David C. Bohrer, Merchant & Gould LLC, San Jose, CA, Harry Frederick Doscher, Lorraine M. Casto, Michael John Lyons, Morgan, Lewis & Bockius LLP, Victoria Q. Smith, Perkins Coie LLP, Palo Alto, CA, Stacey E. Stillman, Attorney at Law, Redwood City, CA, Thomas D. Kohler, Downs Rachlin Martin PLLC, Burlington, VT, for Plaintiff. Perry Reed Clark, Law Offices of Perry R. Clark, Palo Alto, CA, Jenny N. Lee, Kirkland & Ellis LLP, Sarah Louise Forney, Newman Du Wors LLP, San Francisco, CA, Juan Chardiet, Daniel Mark Press, Chung & Press P.C., McLean, VA, Tai Yong Cho, Tai Cho Attorney at Law, New York, NY, for Defendants Larson, James, United States Magistrate Judge ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF'S MOTION FOR SANCTIONS (DOCKET # 323, 331) *1 Plaintiff’s Motion for Sanctions was heard on February 21, 2007. Having considered the pleadings, the record and oral argument, this Court hereby GRANTS in part and DENIES in part Plaintiff’s Motion for Sanctions. Plaintiff Funai Electric Co., Ltd. (“Funai”) asks this Court to order an evidentiary sanction against Daewoo Electronics Corporation (“DEC”), specifically a finding that all DEC products made, used, or sold between October 25, 2002 and November 27, 2006, containing a 3-in-1 tuner, infringe the '218 patent. Funai argues that such a sanction is warranted against DEC for its belated production of tuner specifications in violation of this Court’s orders and for spoliation of evidence. In the alternative, Funai requests that the Court make findings of fact and preclude DEC from challenging those findings. In addition, Funai requests monetary sanctions including reasonable attorney fees, expenses and costs incurred by Funai in connection with its efforts to obtain discovery of tuner specifications and for preparation of the motion for sanctions. The Court finds that DEC violated the August 3, 2005 Order to produce tuner specifications, and the April 14, 2005 Order to produce schematics. However, neither a finding of infringement, nor the alternative sanctions are warranted. DEC’s conduct does not evince willfulness or bad faith, which are required for the imposition of terminating sanctions. Now that the tuner specifications have been produced, the prejudice suffered by Funai can be cured by monetary sanctions. This is so particularly in light of the fact that Funai has had an opportunity to re-depose DEC’s 30(b)(6) witness on technical topics with the tuner specifications in hand. Finally, a finding that DEC destroyed evidence of its purchase of the infringing tuners is premature at this point. II. FACTUAL AND PROCEDURAL BACKGROUND Funai is suing DEC for allegedly infringing six Funai patents relating to video cassette recorder (“VCR”) design and manufacture. Funai filed its complaint on May 7, 2004. All discovery in this case has been referred by the District Court (Hon. Charles R. Breyer) as provided by 28 U.S.C. § 636(b) and Civil Local Rule 72. This Court issued Orders regarding discovery on April 14, 2005, August 3, 2005, and September 18, 2006. The instant discovery dispute centers around Funai’s attempt to obtain various tuner specifications from DEC. The tuner specifications were included in Funai’s first set of document requests and interrogatories served on October 29, 2004. (See Gex Decl., Exhibits A & B). On February 18, 2005, Funai filed a Motion to Compel Production of Documents, Responses to Interrogatories and Requests for Admission, and Production of 30(b)(6) Deposition Witnesses. (See Gex Decl., Exhibit C). Funai asserts that it had not at that time received a single document in response to the initial Document Requests and Interrogatories. On February 25, 2005, DEC asserts it produced schematics for the LGTMI US5 and US6, the pre-and post-design around versions used in the vast majority of DEC’s VCR products. (See Gex Decl., Sealed Exhibit W). *2 In response to Funai’s motion to compel discovery, this Court issued an Order on April 14, 2005, granting in part and denying in part Funai’s motion. The court found that, “[m]uch of the discovery Plaintiff seeks can and should be produced by the Press Defendants.” The Court addressed seven categories of discovery, including: 3) Service Manuals and Schematics Plaintiff’s motion to compel production of service manuals and schematics is GRANTED. Defendant is hereby ordered to turn over all responsive service manuals and schematics with in 30 days. (See Gex Decl., Exhibit D, Docket #84). On May 27, 2005, at DEC’s 30(b)(6) deposition of Mr. Dong-Han Kang, Funai requested “the tuner vendor specifications for all the tuners in DEC’s VCR products.” DEC indicated that producing them would be, “[n]o problem.” (See Gex Decl., Exhibit E). However, DEC did not produce the tuner specifications. On June 16, 2005, Funai sent a letter to DEC asserting that DEC is in contempt of this Court’s April 14, 2005, Order, for failure to produce discovery. The letter specifically referred to tuner specifications. (See Gex Decl., Exhibit. F). On July 12, 2005, Funai filed a letter with Judge Larson with a joint statement concerning compliance with the Court’s April 14, 2005, discovery order. In response to the joint statement, this Court on July 14, 2005, ordered DEC to appear and show cause why it should not be sanctioned under Rule 37(b)(2) for failure to comply with the Order. On July 12 and July 28, 2005, DEC produced some documents. On August 2, 2005, counsel for Funai sent counsel for DEC an e-mail indicating that DEC’s recent productions were incomplete. Funai informed DEC that the complete specification for the TADM-H101 3-in-1 tuner was not included in the production. Funai listed twelve part numbers and descriptions for 3-in-1 tuners for which they had not received specifications. (See Gex Decl., Exhibit K). The show cause hearing was held on August 3, 2005. At the hearing, Mr. Lyons, counsel for Funai, stated “[w]e have identified 12 tuners which the part number from their documents we don't have the specification for ...” (See Gex Decl., Exhibit J; Docket # 129, Reporters Transcript of Proceedings, Thursday August 3, 2005, pg. 20, line 23). This Court stated: [W]hen there are so many problems with discovery, you are going to go up the ladder rather quickly, and particularly with Judge Breyer, in terms of the severity of sanction from monetary to issue preclusion to findings of fact and rulings of law that relate to the defects in the discovery. ... So I encourage you to impress upon your people that they need to pay attention to what is ordered by the Court here. ... You have to make sure that all the technical stuff gets turned over and that the specimens of all the products in question and the manuals are produced. (Pg. 22, line 13 - pg. 23 line 18). The Court then imposed a monetary sanction of $20,000 in order to “impress upon” Mr. Press and his clients that “this is a matter of urgency,” and to send a “message” (Pg. 24, line 2-8). On August, 23, 2005, Daniel Press, counsel for DEC, sent a letter to Michael Lyons and Steven Daniels, counsel for Funai. The letter included a specification for the ALTMI-US5 tuner. The letter stated that DEC has produced what it has, and that DEC is looking for the complete specification for the TADM-H101 3-in-1 tuner, but has not been able to locate anything by that reference number. (Gex Decl., Exhibit L). *3 In September of 2005 DEC asserts, it located the tuner specifications referenced in the letter. Mr. Min-Yong Song, Deputy Manager of Patent Licensing for DEC, sent the specifications to DEAM in New Jersey for delivery to counsel, and believed that the specifications had been produced. The specifications were lost in transit, and Funai never received them. Accordingly, in September of 2005, DEC believed that the specifications at issue had been produced. (See Song Decl., January 31, 2007). Funai continued to seek the specifications. On September 23, 2005, March 10, 2006, March 17, 2006, and July 3, 2006, Funai sent DEC letters inquiring about the non production of documents and specifically inquiring about the specification for the TADM-H101 tuner. (Gex Decl., Exhibits M, O, P, R). On October 20, 2006, Funai deposed Mr. Kang, DEC’s 30(b)(6) technical witness and learned that the tuner specifications that DEC had produced in July and August of 2005 did not include tuner specifications for the tuners DEC used in its current accused products. (See Gex Decl., Sealed Exhibit T). On November 16, 2006, counsel for Funai sent counsel for DEC yet another letter indicating that because it had not received the US5 or US6 tuner specifications, Funai planned to ask the court for evidentiary sanctions. (See Gex Decl., Exhibit U). At the November 21, 2006, meet and confer, Funai again advised DEC that it intended to seek sanctions for DEC’s failure to produce the missing tuner specifications unless produced by November 27, 2006. (See Gex Decl., Exhibit V). On November 27, 2006, DEC produced the tuner specifications. In addition, on December 13, 2006, DEC produced over 2,232 pages of discovery. Funai asserts this production included four tuner specifications not previously produced. III. ANALYSIS A. Governing Law Federal courts have the authority to sanction litigants for discovery abuses under both the Federal Rules of Civil Procedure and the court’s inherent power to prevent abuse of the judicial process. Chambers v. NASCO, Inc., 501 U.S. 32, 45-46 (1991); In re Matter of Yagman, 796 F.2d 1165, 1187 (9th Cir. 1986). Where a party fails to comply with a discovery order, Federal Rule of Civil Procedure 37 authorizes the court to impose a range of sanctions, including, inter alia, taking facts as established, precluding evidence, and dismissing the action or entering default judgment. Fed.R.Civ.P. 37(b)(2); Network Appliance, Inc. v. Bluearc Corp., 2005 WL 1513099, 2 (N.D. Cal. 2005). “Under Rule 37(b)(2), subsections (A) through (C), sanctions are appropriate only in extreme circumstances and where the violation is due to willfulness, bad faith, or fault of the party.” In Heritage Bond Litigation, 223 F.R.D. 527, 530 (C.D. Cal. 2003) (internal citations omitted). In deciding whether to grant a motion for sanctions under subsections (A) through (C) of Rule 37(b)(2) for noncompliance with discovery, a court may consider five factors: “(1) the public’s interest in expeditious resolution of litigation; (2) the court’s need to manage its docket; (3) the risk of prejudice to [the party seeking sanctions]; (4) the public policy favoring disposition of cases on their merits; and (5) the availability of less drastic sanctions.” See Id. (Internal citations omitted). Since the “first two of these factors favor the imposition of sanctions in most cases, while the fourth cuts against a ... sanction[,] ... the key factors are prejudice and the availability of lesser sanctions.” Henry v. Gill Indus., 983 F.2d 943, 948 (9th Cir. 1993). *4 In addition, a sanction must be “specifically related to the particular ‘claim’ which was at issue in the order to provide discovery.” Kahaluu Const. Co., Inc., 857 F.2d 600, 602 (9th Cir. 1988). B. DEC violated this Court’s discovery orders. 1. The April 14, 2005, Order. The April 14, 2005, Order states, “[m]uch of the discovery Plaintiff seeks can and should be produced by the Press Defendants.” The Court addressed seven categories of discovery, including: 3) Service Manuals and Schematics Plaintiff’s motion to compel production of service manuals and schematics is GRANTED. Defendant is hereby ordered to turn over all responsive service manuals and schematics with in 30 days. This Court ordered DEC to produce “schematics,” which are a part of the tuner specification, within thirty days. On December 13, 2006, over twenty months later, DEC produced four tuner specifications that contained schematics not previously produced. Accordingly, DEC violated the April 14, 2005, Order to produce schematics. 2. The August 3, 2005 Orders. During the August 3, 2005, show cause hearing, counsel for Funai stated, “[w]e have identified twelve tuners which the part number from their documents we don't have the specification for ...” (Docket # 129, Reporters Transcript of Proceedings, Thursday August 3, 2005, pg. 20, line 23). This Court ordered DEC “to make sure that all the technical stuff gets turned over and that the specimens of all the products in question and the manuals are produced.” (Pg. 22, line 13 - pg. 23, line 18). This Court then imposed a monetary sanction of $20,000 in order to “impress upon” Mr. Press’s clients that “this is a matter of urgency,” and to send a “message.” (Pg. 24, line 2-8). On August 23, 2005, Daniel Press, counsel for DEC, faxed a letter to Michael Lyons and Steven Daniels, counsel for Funai. The letter stated: You have raised questions as to whether we have fully provided specifications as to tuners, listing a number of tuners. DEC has produced what it has. With regard to the particular tuners listed by you, we respond as follows: The complete specification for the TADM-H101 3-in-1 tuner: DEC is looking for this, but have not been able to locate anything by that reference number. DE 001386 may have been a sample of the “before” design around by LG that was not in fact used by DEC. Part Code 97P7619700, ALTMI-US5: DEC did not have this spec, but requested this spec from its supplier and is producing it herewith (Production Nos. 29406-29452) (See Gex Decl., Exhibit L). DEC also listed a number of tuner specifications that it “does not have,” believes “were either lost or discarded long ago,” and “does not recognize.” (Gex Decl., Exhibit L). In September of 2005, DEC states, it located the LGTMI US5 and US6 tuner specifications. DEC offers the declaration Mr. Song, Deputy Manager of Patent Licensing for DEC, which states that he sent the specifications to DEAM for delivery to counsel. However, the specifications were lost in the mail. Accordingly, while DEC thought the specifications had been produced, counsel for Funai never received them. DEC’s contention that it thought the specifications had been produced in September of 2005 does not insulate DEC from being in violation of this Court’s August 3, 2005, Orders. First, Mr. Song’s Declaration indicates that he sent the specifications to DEAM in New Jersey. Mr. Song did not send the documents directly to Funai, but sent them to a mere subsidiary, which was to produce the documents to Funai. DEC is obligated to take further steps to ensure that the documents were actually produced to Funai. *5 Second, Funai sent letters to counsel for DEC explicitly asking for the missing tuner specifications, which should have alerted DEC that the specifications were not produced. For example, on September 23, 2005, Michael Lyons, counsel for Funai, sent Daniel Press, counsel for DEC, a letter stating, “Your August 23 letter states that DEC is looking for the complete specification for tuner TADM-H101, produced in part at DE 001386. DEC should produce this specification immediately.” (See Gex. Decl., Exhibit M). On March 10, 2006, Michael Lyons sent a letter to Daniel Press stating, “Your August 23, 2005, letter states that DEC is looking for the complete specification for tuner TADM-H101, produced in part at DE 001386. DEC should produce this specification immediately.” (See Gex Decl., Exhibit O). On March 17, 2006, Michael Lyons sent a letter to Daniel Press stating, “I still have not received any response to my March 10, 2006, letter concerning Daewoo’s continuing discovery deficiencies ...” (See Gex Decl., Exhibit P). On July 3, 2006, Lekha Gopalakrisnan, counsel for Funai, sent another letter stating, “Your August 23, 2005 letter stated that DEC was looking for the complete specification for tuner TADM-H101, produced in part at DE 001386. Please update us on the status of your investigation and provide the complete specification by July 21, 2006.” (See Gex. Dec., Exhibit R). On November 16, 2006, Archana Ojha, counsel for Funai, sent counsel for DEC a letter indicating that because it had not received the US5 or US6 tuner specifications, Funai planned to ask the court for evidentiary sanctions. (See Gex Decl., Exhibit U). At the November 21, 2006, meet and confer, Funai again advised DEC that it intended to seek sanctions for failure to produce the missing tuner specifications if they were not produced by November 27, 2006. On November 27, 2006, DEC produced the tuner specifications. In addition, on December 13, 2006, DEC produced over 2,232 pages of discovery, which included four tuner specifications not previously produced. DEC should have been made aware by the repeated letters sent by Funai that the tuner specifications were not produced. DEC’s mere belief that the documents had been produced does not absolve DEC from its discovery obligations. Thus, DEC violated the August 3, 2005, Discovery Order. C. Terminating sanctions are not warranted. 1. DEC’s conduct does not evidence bad faith or willfulness. A party’s violation of the court’s orders must be due to willfulness or bad faith to justify the imposition of terminating sanctions. Adriana International Corporation v. Thoeren, 913 F.2d 1406, 1412 FN5 (9th Cir. 1990) (internal citations omitted). Mere negligent conduct is insufficient to impose the severe penalty of exclusionary sanctions. Network Appliance, Inc., v. Bluarc Corp., 2005 WL 1513099, 3 (N.D.Cal). A party acts willfully if it engages in “disobedient conduct not shown to be outside the control of the litigant.” Fjelstad v. American Honda Motor Co., 762 F.2d 1334, 1341 (9th Cir. 1985). “Disobedient conduct” connotes deliberate malfeasance, rather than mere inadvertence. Id. In order for a court to impose terminating sanctions, a party’s conduct must be more egregious than DEC’s conduct. For example, in Anheuser-Busch, Inc. v. Natural Beverage Distributors, 151 F.R.D. 346, 353 (N.D. Cal. 1993), the district court granted plaintiff Anheuser’s motion to dismiss defendant’s counterclaim, pursuant to Fed.R.Civ.P. 37, for violating court-ordered discovery. Id. at 347. Defendant represented that critical business documents were destroyed by a fire. Id. In fact, the records had survived the fire. A police detective called defendant to inform her that the documents had been salvaged and defendant visited the police facility where she actually viewed the documents. Id. at 349. Thus, defendant had knowledge of their existence, and repeatedly lied to both Anheuser and the court about the alleged destruction. Id. The court determined that defendant’s story was “utterly devoid of credibility,” and her testimony was difficult to characterize as anything but perjury. Id. at 51. Thus, a sanction of dismissal was warranted. *6 In Electronics for Imaging v. Photoscript Group, 1999 U.S.Dist. LEXIS 7395 (N.D. Cal. 1999), the court found that defendants had engaged in many forms of litigation misconduct and imposed terminating sanctions. Defendants failed to participate in court-ordered mediation; failed to meet and confer; failed to attend or participate in a further case management conference; failed to timely prepare and serve their Proposed Claim Construction Statement; refused to provide substantive responses to outstanding discovery; ignored requests to meet and confer; failed to make available various officers for deposition, and; effectively barred plaintiffs from conducting additional discovery. The court found that defendants impeded the orderly and efficient resolution of the action and prevented plaintiffs from obtaining a full and fair opportunity to pursue its claims. Thus, terminating sanctions were warranted. In Valley Engineers Inc. v. Electric Engineering Company, 158 F.3d 1051, 1056 (9th Cir. 1998), the Ninth Circuit upheld dismissal as a discovery sanction where the facts indicated dishonesty, as opposed to mere recalcitrance and delay regarding production of critical evidence. In that case, Electric Engineer withheld a “smoking gun” memorandum that, if disclosed, would have unequivocally destroyed its case. The attorneys went to great lengths to conceal the document - deliberately withholding it for three years, obliterating notations taken of the memorandum during a conference, lying about its existence, allowing trial date settings to be vacated because of incomplete discovery, and asserting the attorney-client privilege with regard to the memorandum even after Electric Engineering waived its attorney-client privilege regarding discovery requests. Id. at 1054-55. The court characterized the attempted concealment of the memorandum as a “shocking betrayal of obligations to the court and opposing counsel ...” Id. at 1055. The court distinguished that dishonest conduct from the conduct in Fjelstad, where the court declined to impose terminating sanctions. In Fjelstad, response to discovery had been exceedingly slow despite court orders to do it much faster, but no willful deception was found. Id. Further, there was nothing about the pattern of production to suggest an inference that the recalcitrant party’s defenses were meritless. Id. DEC’s conduct, while reprehensible, falls short of meeting the high standard required for the imposition of terminating sanctions. The record does not support a finding that the specifications produced in November and December of 2006 were willfully withheld from plaintiff. DEC asserts that to date it has produced tens of thousands of documents, and thought that the tuner specifications had been produced in September of 2005, one month after this Court’s August 3, 2005, Order. The declaration of Mr. Song, Deputy Manager of Patent Licensing for DEC, states that in August 2005 DEC produced the ALTMI-US5 specification and in September of 2005 sent the LGTMI US5 and US6 tuner specifications to DEAM in New Jersey for delivery to counsel. While DEC’s failure to successfully produce the specifications is inexcusable, it does not indicate bad faith or willfulness. DEC’s failure to respond to the many letters sent by Funai’s counsel may indicate negligence and recalcitrance, but cannot be characterized as deliberate malfeasance or a “shocking betrayal of obligations.” Accordingly, the imposition of terminating sanctions is unwarranted. 2. DEC’s conduct during the IP Gobal case is not relevant. During the August 3, 2005 hearing, Funai raised DEC’s conduct in the IP Global litigation[1]. This Court stated, “I'm willing to leave aside past history.” (Docket # 129, Reporter’s Transcript of Proceedings, Thursday, August 3, 2005, pg. 11, line 24-25). In addition, in this Court’s Order Denying Plaintiff’s Motion for Sanctions Against Daewoo Electronics Corporation and Daewoo Electronics America, Inc. (Filed December 29, 2005), it addressed the IP Global litigation: *7 Defendants point out that the patent infringement issues in that case involved different products than this case. Regardless, those sanctions stem from a completely separate litigation involving the defaulting defendants. The court cannot award sanctions solely on the basis of similar circumstances in a different case and a different court. Thus, this Court has declined to consider the IP Global litigation as relevant. It should be clear to Funai at this point, that the Court will not award sanctions based on similar circumstances in a different case and a different court. 3. The prejudice suffered by Funai is curable by a monetary sanction. Exclusion sanctions based on alleged discovery violations are generally improper absent undue prejudice to the opposing side. Amersham Pharmacia Biotech, Inc. v. Perkin-Elmer Corp., 190 F.R.D. 644, 648 (N.D. Cal. 2000) (internal citations omitted). A party suffers prejudice if the opposing party’s actions impair its ability to go to trial or threaten to interfere with the rightful decision of the case. Adriana International Corporation v. Kunz, 913 F.2d 1406, 1412 (9th Cir. 1990). Funai cites Anheuser-Busch for the proposition that last minute tendering of documents does not cure prejudice. In Anheuser, after determining that the defendant willfully violated the rules of discovery by not producing relevant documents and that defendant’s story was “utterly devoid of credibility,” the court addressed the issue of prejudice. Id. at 348-353. Defendant contended that plaintiff had not been prejudiced because (1) the documents were produced two months before (the second) trial, and (2) because the documents disproved Anheuser’s case. Id. The court flatly rejected these arguments. First, the court noted that it is well established that “[b]elated compliance with discovery orders does not preclude the imposition of sanctions.” Id. (internal citations omitted). In addition, the “[l]ast minute tender of documents does not cure the prejudice to opponents nor does it restore to other litigants on a crowded docket the opportunity to use the courts.” Id. Accordingly, the court found that defendant’s late production of documents would not cure any prejudice otherwise suffered by Anheuser. Id. The court found that Anheuser had been prejudiced for several reasons: Anheuser was forced to rely on incomplete and spotty evidence in presenting a critical portion of its case - the financial analysis at trial; Anheuser could have presented a much more solid financial picture that would have been less assailable at trial; and Anheuser was subjected to great delays and expense before it was able to obtain the documents. Id. at 354. Finally, the court found defendant’s contentions that the missing documents supported its position to be disingenuous. Accordingly, the court concluded that defendant’s failure to produce the documents prejudiced Anheuser. Id. In the instant case, while Funai correctly asserts that late production of documents does not cure prejudice, delay alone has been held to be insufficient prejudice to meet the requisite standard[2]. See, e.g., Kahaluu Const. Co., Inc., 857 F.2d 600, 604 (9th Cir. 1988) (emphasis added). In Anheuser, the prejudice was patent. Anheuser conducted an entire trial relying on incomplete and spotty evidence. Anheuser’s ability to go to trial and the rightful decision in the case was severely impaired by defendant’s failure to produce the documents. Clearly, defendant’s production of the business records after the trial did not cure the prejudice Anheuser suffered at trial. Funai asserts that it received the tuner specifications in November and December of 2006. The discovery cut off date is not until March 30, 2007 and trial is set for July 2 of 2007. Funai’s ability to go to trial has not been threatened, nor has the rightful decision of the case been interfered with. The depositions of DEC’s 30(b)(6) witness for technical topics *8 In 2005 and 2006 Funai deposed Mr. Kang, DEC’s 30(b)(6) witness for technical topics, without having tuner specifications for a majority of the tuners used in DEC’s accused products. However, in January 2007, Funai deposed Mr. Kang again on issues related to the tuner specifications, with the tuner specifications in hand. Funai spent five days with Mr. Kang. Accordingly, the prejudice suffered by Funai will be cured by monetary compensation for the time spent deposing Mr. Kang without access to the relevant tuner specifications, and for the re-deposition. See, e.g., Tarango Trucking v. County of Contra Costa, 202 F.R.D. 614, 622 (N.D. Cal. 2001) (district court denied plaintiffs motion for evidentiary sanctions pursuant to Rule 37(c)(1) against defendants but reopened trial to enable plaintiff to cross-examine any witness about the documents that defendants produced at the end of trial.); Zubulake v. UBS Warburg LLC, 229 F.R.D. 422, 437 (Zubulake V) (as a remedy for the belated production of restored e-mails, the court ordered defendants to pay the costs of any depositions or re-depositions required by the late production.) The time and money expended by Funai seeking discovery Funai has expended substantial time and money seeking discovery during the past two years. A monetary sanction as provided by Federal Rule of Civil Procedure 37(b)(2)(E) including all reasonable attorney fees, expenses and costs incurred by Funai in connection with its efforts to obtain discovery of tuner specifications and for preparation of this motion should cure this prejudice. 4. The alleged destruction of evidence “A federal trial court has the inherent discretionary power to make appropriate evidentiary rulings in response to the destruction or spoliation of relevant evidence.” Glover v. BIC Corp., 6 F.3d 1318, 1329 (9th Cir. 1993). Courts may sanction parties responsible for spoliation in several ways. First, a court can instruct the jury that it may draw an inference adverse to the party or witness responsible for destroying the evidence. Id. Second, a court may exclude witness testimony proffered by the party responsible for destroying the evidence and based on the destroyed evidence. Id. Finally, a court may dismiss the claim of the party responsible for destroying the evidence. In re Napster, Inc. Copyright Litigation, 2006 WL 3050864 *4 (N.D.Cal.). A party’s destruction of evidence need not be in “bad faith” to warrant a court’s imposition of sanctions. Glover at 1329. Nevertheless, a party’s destruction of evidence qualifies as willful spoliation only if the party has “some notice that the documents were potentially relevant to the litigation before they were destroyed.” Leon v. IDX Systems Corp., 464 F.3d 951, 959 (9th Cir. 2006). However, a party’s motive or degree of fault in destroying evidence is relevant to what sanction, if any, is imposed. In re Napster, at *4. DEC has an affirmative duty to preserve the order placements and invoices for tuners at issue, because they are relevant to the litigation. See, e.g., National Ass'n of Radiation Survivors, 115 F.R.D. 543, 557-58 (N.D. Cal. 1983) (“The obligation to retain discoverable materials is an affirmative one; it requires that the agency or corporate officers having notice of discovery obligations communicate those obligations to employees in possession of discoverable materials.”). However, the record at this point does not indicate that the evidence has been destroyed. (See Ojha Decl., Exhibit BB, pg. 415:8-25; 419:8-25). Accordingly, a sanction for spoliation of evidence is not warranted. IV. CONCLUSION This Court GRANTS in part and DENIES in part Funai’s Motion for Sanctions. A monetary sanction including all reasonable attorney fees, expenses and costs incurred by Funai in connection with its efforts to obtain discovery of tuner specifications and for preparation of this motion is hereby GRANTED. Funai is ordered to submit to the Court within 30 days a sworn declaration documenting its expenses. *9 IT IS SO ORDERED. Footnotes [1] IP Global, Ltd. V. Thomson Consumer Electronics, Inc., et al., Civil Action No. 00-361 (RGD) (E.D.Va.), filed May 15, 2000. [2] Failure to produce documents as ordered, however, is considered sufficient prejudice. Securities and Exchange Comm'n v. Seaboard Corp., 666 F.2d 414, 417 (9th Cir. 1982).