June 25, 2013 Top Story

Unfulfilled Discovery Promises Lead to Rule 16(f) Sanctions

District court imposes sanctions for delaying case without a finding of bad faith

Angela Foster

A party engaging in unreasonable or obstreperous conduct that delays the discovery process may face sanctions. Despite no finding of bad faith or negligence, the District Court of Colorado sanctioned the Equal Employment Opportunity Commission (EEOC) for failing to provide social media discovery and causing unnecessary delays in the e-discovery process. EEOC v. The Original HoneyBaked Ham Company of Georgia, Inc.

Class Action Members Discuss Case over Facebook

The EEOC sought damages from the Original HoneyBaked Ham Company of Georgia, Inc., (HoneyBaked Ham), alleging HoneyBaked Ham sexually harassed a class of female employees. During discovery, HoneyBaked Ham obtained information that a class member posted statements on her Facebook page that discussed her financial expectations in the lawsuit. The class member also discussed her positive outlook post-termination, sexual aggressiveness, sexual communications with other class members, and post-termination employment and financial condition. Other class members posted comments on the Facebook page. HoneyBaked Ham moved to compel the social media information of all class members, arguing this information may be relevant and admissible regarding the class members’ damages and credibility.

Motion for Sanctions

The court granted HoneyBaked Ham’s motion to compel and ordered the parties to engage a forensic expert as a special master to whom the EEOC would produce each class member’s social media information. The court ordered the parties to jointly create a questionnaire for the class members to identify potential sources of discoverable information and instructions for the special master to define the parameters of the information he collected.

After months of negotiating and exchanging draft questionnaires and parameters for the special master, the EEOC refused to produce the social media information. Particularly, an EEOC supervisor disagreed with the questionnaire language provided by the EEOC’s line attorneys. Apparently, the EEOC’s counsel had made promises about agreed-upon discovery methodology and procedure when they had no authority to do so. As a result, HoneyBaked Ham moved for sanctions against the EEOC for failure to comply in good faith with the court’s order on the motion to compel.

Court Expands Rule 16 Sanctions

Noting that Federal Civil Rule 11 requires a finding of bad faith and Civil Rule 37 requires a violation of a court order—and that neither occurred here—the court looked to Civil Rule 16. Citing Mulvaney v. Rivair Flying Serv., Inc., the court held Civil Rule 16(f) affords courts broad discretion to impose sanctions to ensure that attorneys fulfill their duty to ensure the expeditious and sound management of trial preparation.

In Mulvaney, four days before trial, the third-party defendant moved for continuance based on failure to depose a critical witness. The parties had tried to agree on a mutually acceptable time for the deposition but their efforts failed. The trial court granted the continuance but imposed a $350 sanction on the attorneys for the plaintiff and the third-party defendant for the effect the delay in trial created for the court. Sitting en banc, the Tenth Circuit affirmed the sanction and instructed that a district court should impose a sanction necessary to deter conduct that unreasonably delays and interferes with trial management.

Applying Mulvaney, the court sanctioned the EEOC for unnecessary waste and expense that it caused and awarded HoneyBaked Ham reasonable attorney fees and cost expended in bringing the motion for sanctions.

Has Rule 16 Swallowed Rule 37?

Basically, the court extended Mulvaney to include activities that caused discovery to be lengthier and more burdensome than it otherwise would be, says Ian H. Fisher, Chicago, cochair of the ABA Section of Litigation’s Trial Evidence Committee. “Noting the limitations of Rule 37, the court expanded the reach of Rule 16(f),” Fisher states. He questions “at what point does Rule 16(f) swallow Rule 37(b)?”

Surprised that the judge did not invoke sanctions under Rule 37, Betsy P. Collins, Mobile, AL, cochair of the Section of Litigation’s Pretrial Practice and Discovery Committee believes the judge did not sanction the EEOC’s conduct under Rule 37 as “bad faith” because of possible questions of fact in an appeal.

Be Careful What You Promise 

“If you don’t know whether you can commit to something, say so,” advises Kent A. Lambert, New Orleans, cochair of the Section’s Trial Evidence Committee. He cautions that attorneys must be prepared in the discovery conference and know the scope of their authority. “An attorney cannot commit to what he does not have authority and should always ask for time to speak with the client before committing,” states Lambert.

Attorneys must make a decision how to control their client regarding what occurs in the court, adds Collins. “If the client is ‘obstreperous’ you must make an election to withdraw because once you lose credibility with the court, you may never regain it,” she says. Collins advises attorney to tell the court that you need approval; the judge may not like your answer but you will not lose credibility.

Keywords: sanctions, social media, discovery, Civil Rule 16

Related Resources

  • Mulvaney v. Rivair Flying Serv., Inc., 744 F.2d 1438 (10th Cir. 1984).

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