On December 11, 2012, an Anoka County District Judge awarded my clients Ed Fields and Sons, Inc., $73,938.75 in sanctions during litigation I commenced against the Defendant, 1st Regents Bank, for discovery misconduct. (December 11, 2012 Order, James E. Fields, et al. v. Anthony Emmerich, et al., Court File No. 02-CV-11-5482) The litigation involved a multimillion dollar transaction and included causes of action such as fraud and conspiracy claims. I had sent discovery requests to 1st Regents asking for all emails related to the transaction at issue. The Bank responded that they had no emails. I pursued the issue with a Rule 115 letter and conference and the Bank continued to take the position that no such emails existed and therefore none would be produced.
During a deposition, I noted that the Bank president was, as many of us do, using his Blackberry or iPhone to communicate throughout the day. I approached his lawyers after the deposition and again requested that 1st Regents Bank find potential emails related to the litigation. The Bank once again took the position that no such emails existed. This did not seem believable considering that this was a multimillion dollar transaction at issue and the Bank president clearly used technology. There were other defendants named in the suit and because of the additional claims of fraud and conspiracy, I believed that emails could exist between the parties that may very well be relevant to my causes of action.
Instead of just bringing a motion to compel, I asked for an order allowing a forensic examination of the Bank’s computers. Mark Lanterman, the President and CEO of Computer Forensic Services, had developed protocols now known as the “Lanterman Protocols” to provide for the utmost protection for safety and security of any potential confidential data the Bank had on its computers. I hired them to perform the examination. The motion was met with insistence once again that such emails did not exist but the court ordered that the examination would go forward. As the forensic examination was about to commence, the Bank produced some emails that they indicated they had found with the help of a computer consultant. I went forward with the forensic examination, but I also deposed the computer consultant used by the Bank and discovered that the Bank had had a very short phone conversation with the computer consultant. The forensic computer search turned up many emails related to the transaction at issue, approximately 20 of which I believed were relevant to our claims and in fact some were used in defeating Defendants’ motions for summary judgment on the claims, including but not limited to my claims for fraud and conspiracy which also all remain for trial.
After the discovery of the emails by the forensic examination, I brought a motion to have all costs for the motion, the computer forensic search, and all attorneys fees in dealing with the issue paid for by Defendant 1st Regents Bank. The court awarded all costs against the Bank and in favor of my client.
In awarding the fees, the court found that 1st Regents’ misconduct was perpetuated by bad faith. The Bank had engaged in dilatory tactics at every step of road, blocking us from discovering relevant emails. The court stated that “A meaningful search for emails was required and that was not performed.” The court awarded the sanctions against 1st Regents, but it should be noted that the court indicated that “Counsel has a duty to assure that the client has provided responsive documents. It is not sufficient to just take a client at their word. Counsel must inquire about what searches were performed to find responsive documents.” (Page 49)
I think this Order is a good example of the trend in the court system to award sanctions where appropriate in cases such as this, where the defendant’s actions are delaying the litigation and causing the litigation to be more expensive for the plaintiff than need be, if they had followed the rules. Unfortunately, many times parties cannot afford to do a computer forensic examination because the litigation may not support that type of expense. However, I think there is a trend in the courts that if parties are causing unreasonable expense, the courts will award those expenses, and rightly so. This is again a good example of the court enforcing the Rules of Civil Procedure in an appropriate way. It is a positive trend to deter delay tactics. It is also notice to practitioners that courts have high expectations for attorneys to educate their clients, and in some cases insist that their clients hire proper consultants to fully respond to discovery.