Over 354 pages, Judge Pannell, a U.S. District Court Judge, recounts the course of protracted litigation in an inadequate security case against an apartment complex owner, including the defendant’s failure to disclose 42 employees; failure to identify the property manager on the date of the shooting; intentional suppression of security logs; failure to disclose the “Mayes” case; bad faith objections to the production of documents; spoliation of emails; hiding an eyewitness; consistently making false statements; and multiple violations of and/or failures to comply with the ESI order; as well as the authority of the Court to impose sanctions under Rule 23(g), Rule 37(e), Rule 37(c)(1), Rule 37(b), and the Court’s Inherent Authority; before imposing sanctions on both the Defendant and Defense Counsel:

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“The court finds that the defendant’s pattern of conduct throughout this litigation – in addition to many of its stand-alone actions – demonstrates bad faith sufficient to support the imposition of sanctions pursuant to the court’s inherent authority. This bad faith has delayed and disrupted this litigation to the extent that – two years into this matter – the plaintiffs are no closer to a resolution on the merits than they were than when they started. And perhaps that was part of the defendant’s goal: in that two-year timeframe, the defendant sold the instant property and likely divested itself of the majority (if not all) of its assets, potentially limiting the plaintiffs’ recovery to that recoverable through the defendant’s insurance policy. Moreover, the defendant’s bad faith has undermined judicial authority in this action, causing the court to issue orders premised on false representations and significantly delaying the administration of justice while the court has waded through almost every document on the docket in an effort to decipher the truth despite the defendant’s manifold misrepresentations. Despite those efforts, it is now clear to the court that the truth regarding many of the key issues in this matter will never be known because the defendant has fired employees, permanently deleted email accounts, and sold the property without copying or retaining files or securing its computers. In addition, the defendant’s remaining employees have provided testimony that contradicts each other and contradicts themselves in this case and in the Mayes case….  After much analysis and careful review of the record, the court concludes that the plaintiffs’ requested remedy of striking the defendant’s answer is the only alternative available that will cure the harm the defendant’s misconduct inflicted in this matter. As detailed extensively throughout this order, the truth is utterly unknowable at this juncture. The defendant destroyed its most relevant records, failed to disclose at least twothirds of its Eastwyck employees, provided inconsistent and unreliable testimony, delayed in fulfilling unambiguous court orders and engaged in sundry other discovery infractions too numerous to list. Unfortunately, at this late juncture, it is apparent to the court that these failures and infractions cannot be remedied: former employees have indicated they are unwilling to testify, the forensic examiner has certified that emails cannot be recovered, and the defendant’s representative is apparently unknowledgeable and untrustworthy. Nor could they have been remedied between counsel without motions practice….  The defendant’s wrong-doing amounts to much more than ‘disorganized records’ and ‘poor recordkeeping’: as the court has previously articulated, it finds the defendant’s actions in divesting itself of the majority of relevant evidence reflective of an intentional, bad-faith strategy of ignorance. As other courts have pointed out, ‘litigation is not a game’, and the defendant’s treatment of it as such (albeit a game without rules) has wrought havoc on this litigation. The only way that the court can ensure that the defendant does not profit from its infractions and preserve any semblance of justice in this matter is by striking the defendant’s answer….

“In addition to sanctioning the defendant, the court finds that justice dictates an award of sanctions against the defense counsel, who served as willing accomplices and enablers in the bad faith and contumacious behavior the defendant displayed in this matter. As the plaintiffs’ requests for sanctions gained momentum, the court has witnessed the defense counsel attempt to distance themselves from their client. Certainly, the court understands this approach: the defendant has engaged in a multitude of improper behavior in this litigation, and – as that behavior was unveiled – the likelihood of severe sanctions was more than probable. However, rather than attempting to sidestep liability at the last moment, the defense counsel should have heeded the numerous warning signals throughout this litigation that their client needed more guidance and acted sooner to right the ship. The defense counsel did not do so, further entrenching themselves and their client in legal arguments and factual positions that could not hold up to the plaintiffs’ investigation and the court’s scrutiny. Moreover, the court discovered that the defense counsel alone made the decision not to disclose a witness to both their client and the plaintiffs. Accordingly, pursuant to both Rule 26(g) and the court’s inherent authority, the court holds both attorney Perniciaro and attorney Moffett jointly and severally liable, along with their client, for the plaintiffs’ attorneys’ fees tied to the discovery violations, as outlined above. The court finds that such an award is directly related to and rendered necessary by the defense counsels’ poor conduct. Because the defense counsel continually failed to acknowledge, much less discharge, their responsibilities in discovery, they placed the plaintiffs and the court in the position of having to define their searches and compel their actions. For instance, the plaintiffs – despite not knowing the identity of custodians and accounts – had to attempt to list email accounts for the defendant to search in their motions to compel the production of ESI and the forensic inspection. Moreover, the plaintiffs had to exercise constant vigilance to ensure that the defendant did a fraction of what it represented it had done. The court, time and time again, presumed professionalism on the part of the defense counsel and relied on their misrepresentations when, in hindsight, it is clear that it should not have. This resulted in avoidable delays and more work for both the court and the plaintiffs’ counsel. An award of attorney’s fees to the plaintiffs related to these errors represents equity, not a windfall. Requiring the defense counsel to share this burden with their client represents the fair impact their contribution had on the ultimate outcome in this case. In imposing these sanctions upon the defense counsel, the court notes that this is not a situation which can be attributed to a lack of knowledge about a particular area of the law or cured by continuing legal education. This is a situation about dishonesty, assisting in dishonesty, and attempting to mislead the court about dishonest activity. No amount of continuing legal education, seminars, reprimands, admonitions, fines, or other rehabilitative measures will cure or discourage this type of activity. The court has considered lesser sanctions, but it is appropriate for attorneys Moffett and Perniciaro to have to pay for some or all of the damage they have inflicted upon the plaintiffs.”

 

Mildred Collins-Williams v. Contour Eastwyck, No.20-03129, Doc. 220 (N.D.Ga. Dec. 15, 2022).