Carty v. Steem Monsters Corp.
Carty v. Steem Monsters Corp.
2022 WL 22895524 (E.D. Pa. 2022)
October 26, 2022

Hey, Elizabeth T.,  United States Magistrate Judge

Sanctions
Adverse inference
Default Judgment
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Summary
The court denied the Plaintiff's motion for sanctions against the Defendants for failing to comply with discovery requests and attend a scheduled deposition. The court found that the Defendants were not responsible for the deposition being cancelled and had made efforts to address the Plaintiff's issues with their discovery responses. The court also stated that the Federal Rules of Civil Procedure and Evidence provide mechanisms to address any unfairly withheld evidence at trial.
Additional Decisions
JARED CARTY
v.
STEEM MONSTERS CORP. d/b/a SPLINTERLANDS, et al.
v.
JARED CARTY AND PIMPORN CARTY
CIVIL ACTION NO. 20-5585
United States District Court, E.D. Pennsylvania
Filed October 26, 2022
Hey, Elizabeth T., United States Magistrate Judge

ORDER

*1 AND NOW, this 26th day of October 2022, upon consideration of Plaintiff's Motion for Sanctions (Doc. 70) seeking either a default judgment against Defendants or an adverse inference prohibiting Defendants from relying on “withheld evidence,” and Defendants' response thereto (Doc. 76), IT IS HEREBY ORDERED that the motion is DENIED.[1]

Footnotes

The Federal Rules of Civil Procedure authorize the entry of a default judgment as one of the sanctions available where a party fails to obey an order to provide discovery or fails to appear for a deposition. See Fed. R. Civ. P. 37(b)(2)(A)(vi) & 37(d). In determining whether to impose a default judgment, a court must weigh six factors: “(1) the extent of the party's personal responsibility; (2) the prejudice to the adversary caused by the failure to meet scheduling orders and respond to discovery; (3) a history of dilatoriness; (4) whether the conduct of the party or the attorney was willful or in bad faith; (5) the effectiveness of sanctions other than dismissal, which entails an analysis of alternative sanctions; and (6) the meritoriousness of the claim or defense.” Poulis v. State Farm Fire & Cas. Co., 747 F.2d 863, 868 (3d Cir. 1984) (emphasis in original).
Here, Plaintiff argues that the sanction of a default judgment is warranted because (1) Defendant, Blair Jesse Reich, failed to attend a deposition after the parties agreed to cancel his initial deposition, (2) Defendants failed to request an extension of the discovery deadline, and (3) Defendants failed to respond to discovery requests for “financial transaction data.” Doc. 70 ¶¶ 1-2. There is no dispute that the parties initially agreed that Mr. Reich would be deposed as the corporate representative of Defendant, Steem Monsters Corp., during the week of August 15, 2022, that after Plaintiff sent a list of deposition topics on August 4, defense counsel responded on August 6 that “we will need to reschedule his deposition” in light of the extensive list of issues and Mr. Reich's need to testify in a separate proceeding. Doc. 76-1 at 2-3. The parties thereafter exchanged emails attempting to find a mutually acceptable date for the deposition. See Docs. 76-2 through 76-4. These same emails reveal that Defendants repeatedly reminded Plaintiff to request an extension of the August 31 discovery deadline and, when Plaintiff failed to do so, Defendants drafted a proposed joint extension request, which Plaintiff rejected. See Doc. 76-2 at 2; Doc. 76-3 at 2. The party seeking to depose a person is required to provide notice of the deposition, see Fed. R. Civ. P. 30(b)(1), and it follows that if a party seeks to depose a person outside of the discovery deadline, it is incumbent on that party to request an extension of time. Because Plaintiff sought to depose Mr. Reich, it was incumbent on Plaintiff -- not Defendants -- to seek an extension of time to do so, or to join Defendants' proposed joint request. As such, Defendants' actions regarding Mr. Reich's deposition are not sanctionable.
Similarly, I find that Plaintiff has failed to demonstrate why sanctions are warranted for Defendants' discovery responses. Plaintiff's motion does not identify with meaningful particularity which of Defendants' discovery responses and productions are allegedly insufficient and does not indicate that the parties “met and conferred,” as required, nor did Plaintiff file a motion to compel production of missing “financial transaction data.” Plaintiff has presented no factual or legal bases to conclude that Defendants wrongly withheld discoverable evidence or that Defendants have engaged in dilatoriness or willful conduct. Moreover, many of the email communications attached to Defendants' response, see Docs. 76-1 through 76-8, evidence Defendants' efforts to understand and address Plaintiff's issues with Defendants' discovery responses. In sum, the Poulis factors weigh heavily in favor of denying Plaintiff's motion for default judgment.
Finally, to the extent Plaintiff is concerned that Defendants will rely on alleged “withheld evidence” at trial, such concern is both unfounded and premature. The Federal Rules of Civil Procedure do not allow a party to rely on evidence at trial which was wrongly withheld in discovery. See, e.g., Fed. R. Civ. P. 37(c)(1) (“If a party fails to provide information ... as required by Rule 26(a) or (e) [related to initial or supplemental disclosures] ... the party is not allowed to use that information ... to supply evidence on a motion, at a hearing, or at trial, unless the failure was substantially justified or is harmless.”). Additionally, the Federal Rules of Evidence provide a mechanism to preclude a party from introducing previously withheld evidence at trial. See Fed. R. Evid. 403 (“The court may exclude relevant evidence if its probative value is substantially outweighed by a danger of ... unfair prejudice....”).