Business Law 11th Edition by Kenneth Clarkson,Roger LeRoy Miller,Gaylord Jentz,Frank Cross

تمرين 14

Computer Task Group, Inc. v. Brotby
United States Court of Appeals, Ninth Circuit, 2004. 364 F.3d 1112.
• Background and Facts Computer Task Group, Inc. (CTG), hired William Brotby as an information technologies consultant in 1995. As a condition of the job, Brotby signed an agreement that restricted his ability to work for CTG's customers if he left CTG. Less than two years later, Brotby left CTG to work for Alyeska Pipeline Service Company, a CTG client with which Brotby had worked on a project. CTG filed a suit in a federal district court against Brotby, alleging a breach of the agreement that Brotby had signed when he joined the firm. During discovery, Brotby refused to respond fully to CTG's interrogatories. He gave contradictory answers, made frivolous objections, filed baseless motions with the court, and never disclosed all of the information that CTG sought. He made excuses and changed his story repeatedly, making it impossible for CTG to establish basic facts with any certainty. Brotby also refused to produce key documents. The court issued five separate orders compelling Brotby's cooperation and fined him twice. Finally, in 1999, CTG filed a motion to enter a default judgment against Brotby, based on his failure to cooperate. The court granted the motion. Brotby appealed to the U.S. Court of Appeals for the Ninth Circuit.
PER CURIAM [By the whole court].
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Federal Rule of Civil Procedure 37 permits the district court, in its discretion, to enter a default judgment against a party who fails to comply with an order compelling discovery.* * *
In deciding whether a sanction of dismissal or default for noncompliance with discovery is appropriate, the district court must weigh five factors: (1) the public's interest in expeditious [speedy] resolution of litigation; (2) the court's need to manage its docket [calendar]; (3) the risk of prejudice to the opposing party; (4) the public policy favoring disposition of cases on their merits; and (5) the availability of less drastic sanctions. Where a court order is violated, the first and second factors will favor sanctions and the fourth will cut against them. Therefore, whether terminating sanctions were appropriate in Brotby's case turns on the third and fifth factors.
* * * Brotby engaged in a consistent, intentional, and prejudicial practice of obstructing discovery by not complying * * * with repeated court orders and not heeding multiple court warnings. Brotby violated court orders * * * by failing to provide clear answers to interrogatories, giving contradictory responses, making frivolous objections, filing frivolous motions and failing to provide the information CTG sought. He also failed to pay one of the [fines].* * * Brotby violated orders * * * by failing to produce important financial documents and throwing up a series of baseless smoke screens that took the form of repeated groundless objections and contradictory excuses, which were absurd and completely unbelievable. The excuses included blaming the loss of documents on an earthquake, on a dropped computer and on a residential move.
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* * * [W]hatever Brotby actually produced was mostly incomplete or fabricated-and dribbled in only after a court order. In addition, Brotby changed his story numerous times with regard to his income from work done for Alyeska and the length of his contract with them, as well as the date of his resignation from CTG. These tactics unnecessarily delayed the litigation, burdened the court and prejudiced CTG. In the end, most of the documents CTG sought regarding the nature and extent of Brotby's work for Alyeska were never produced, despite court orders to do so
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* * * Brotby's baseless two-year fight against each and every discovery request and court order has been conducted willfully and with the intent of preventing meaningful discovery from occurring. It has clogged the court's docket, protracted this litigation by years, and made it impossible for CTG to proceed to any imaginably fair trial.
We have held that failure to produce documents as ordered * * * is * * * sufficient prejudice.* * *
In deciding whether the district court adequately considered lesser sanctions, we consider whether the court (1) explicitly discussed the alternative of lesser sanctions and explained why it would be inappropriate; (2) implemented lesser sanctions before ordering the case dismissed;and (3) warned the offending party of the possibility of dismissal.
The [district court] judge appropriately considered the alternative of lesser sanctions. He ordered Brotby to comply with CTG's discovery requests five times * * *. The [judge] also imposed two lesser (monetary) sanctions against Brotby, but to no avail. * * * [I]t is appropriate to reject lesser sanctions where the court anticipates continued deceptive misconduct. Brotby had sufficient notice that continued refusal to cooperate would lead to [the entry of a default judgment against him]. The * * * judge warned him that he should "stop playing games" if he wanted to stay in the game. The two monetary sanctions, five orders compelling him to cooperate and repeated oral warnings were enough to put Brotby on notice that continued failure to cooperate in discovery would result in * * * default. [Emphasis added.]
• Decision and Remedy The U.S. Court of Appeals for the Ninth Circuit affirmed the judgment of the lower court. The appellate court held that "[i]n light of Brotby's egregious [blatant] record of discovery abuses" and his "abiding contempt and continuing disregard for [the court's] orders," the lower court properly exercised its discretion in entering a default judgment against him.
• What If the Facts Were Different Suppose that Brotby had not made frivolous objections and baseless motions but still had failed to comply with discovery requests. How might the court's ruling in this case have been different
• The Legal Environment Dimension What does the result in this case suggest to parties in litigation who might be reluctant to respond truthfully to court requests