Wiedeman v. Canal Insurance Company et al

Filing 229

OPINION AND ORDER denying Plaintiff Gregory Wiedeman's Renewed Motion for Sanctions Against Defendants H&F Transfer, Inc. and Salem Leasing Corporation 221 . Signed by Judge William S. Duffey, Jr on 6/9/17. (ddm)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
GREGORY WIEDEMAN,
Plaintiff,
v.

1:15-cv-4182-WSD

CANAL INSURANCE COMPANY,
H&F TRANSFER, INC., AUTOOWNERS INSURANCE
COMPANY, WALTER PATRICK
DORN, IV, WESCO INSURANCE
COMPANY, and SALEM LEASING
CORPORATION, d/b/a Salem
Nationalease,
Defendants.

OPINION AND ORDER
This matter is before the Court on Plaintiff Gregory Wiedeman’s
(“Plaintiff”) Renewed Motion for Sanctions Against Defendants H&F Transfer,
Inc. and Salem Leasing Corporation [221] (“Renewed Sanctions Motion”).
I.

BACKGROUND
This action arises from an August 8, 2014, collision (the “Collision”)

between Plaintiff and Defendant Walter Patrick Dorn, IV, an employee of
Defendant H&F Transfer, Inc. (“H&F”). The truck Dorn was driving was leased
by H&F from Salem Leasing Corporation (“Salem”). Plaintiff claims H&F and

Salem conspired to destroy, conceal, and falsify data from the electronic control
module (“ECM”) of the truck involved in the Collision.
On the day of the Collision, the investigating officer found Plaintiff at fault
for causing the Collision and issued Plaintiff a citation for failure to yield to the red
light. Plaintiff told the officer “he did not know what he was thinking running the
red light.” ([223] at 2-3).
On August 11, 2014, three days after the Collision, H&F returned the truck
to Salem, after which H&F did not have possession, custody, or control of the
truck or the ECM data contained in it. ([222] at 2-3). On August 14, 2014, Salem
performed what it claims is an industry-standard preventative maintenance check
on the truck. ([223] at 3). The purpose of the check is to identify any maintenance
issues to ensure the truck can be safely operated before it is leased to the next
customer. ([223] at 4). This maintenance check resulted in a reset and deletion of
non-maintenance data from the truck’s ECM. ([221] at 5). Salem claims it was
not aware that the maintenance check procedure would reset non-maintenance data
resident on the ECM. ([223] at 4).
On August 18, 2014, H&F retained John Bethea to inspect the truck. On
August 26, 2014, Mr. Bethea inspected the truck. In his July 27, 2016, expert
report, Mr. Bethea opined that (1) no sudden deceleration was recorded by the

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ECM within the subject truck at the time of the incident and (2) it is not possible
for any sudden deceleration data related to the subject incident to have been
overwritten by subsequent sudden deceleration events because the incident was
never captured by the ECM. ([223] at 4).
On October 7, 2014, Plaintiff sent H&F a letter regarding preservation of
evidence. Plaintiff did not send a similar letter to Salem. ([223] at 4).
On August 11, 2016, Plaintiff filed his first Motion for Sanctions. At a
September 2, 2016, hearing, the Court determined that it did not have sufficient
information to rule on Plaintiff’s motion, and it required H&F and Salem to
recover and produce the laptop Mr. Bethea used during his inspection. The Court
allowed Plaintiff to file a renewed sanctions motions. Two months later, Plaintiff
received a hard drive from the laptop, which revealed that the truck’s ECM had
been accessed between the Collision and Mr. Bethea’s inspection. The data shows
that, prior to the reset, the ECM recorded three sudden deceleration events, one of
which Plaintiff claims “likely was the incident in this case.” ([221] at 4).
On April 5, 2017, Plaintiff filed his Renewed Sanctions Motion. H&F
claims that the conduct of which Plaintiff complains took place after H&F
transferred the truck to Salem, and that H&F thus cannot be held liable for any
alleged spoliation. Salem claims that, because litigation was not reasonably

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foreseeable, it did not have a duty to preserve the ECM data at the time it
accidentally reset the data during its maintenance check.
II.

DISCUSSION
A.

Legal Standard

“Spoliation is the destruction or significant alteration of evidence, or the
failure to preserve property for another’s use as evidence in pending or reasonably
foreseeable litigation.” Graff v. Baja Marine Corp., 310 F. App’x 298, 301
(11th Cir. 2009) (internal quotation marks omitted) (quoting West v. Goodyear
Tire & Rubber Co., 167 F.3d 776, 779 (2d Cir. 1999)). A party seeking spoliation
sanctions must prove that (1) the missing evidence existed at one time; (2) the
defendant had a duty to preserve the evidence; and (3) the evidence was crucial to
the plaintiff's prima facie case. Marshall v. Dentfirst, P.C., 313 F.R.D. 691, 694
(N.D. Ga. 2016) (citing In re Delta/AirTran Baggage Fee Antitrust Litig., 770 F.
Supp. 2d 1299, 1305 (N.D. Ga. 2011)). In considering the particular spoliation
sanction to impose, “courts should consider the following factors: (1) prejudice to
the non-spoiling party as a result of the destruction of evidence, (2) whether the
prejudice can be cured, (3) practical importance of the evidence, (4) whether the
spoiling party acted in good or bad faith, and (5) the potential for abuse of expert

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testimony about evidence not excluded.” In re Delta, 770 F. Supp. 2d at 1305
(citing Flury v. Diamler Chrysler Corp., 427 F.3d 939, 945 (11th Cir. 2005)).
Even if the Court finds spoliation, a sanction of default or an instruction to
the jury to draw an adverse inference from the party’s failure to preserve evidence
is allowed “only when the absence of that evidence is predicated on bad faith.”
Bashir v. Amtrak, 119 F.3d 929, 931 (11th Cir. 1997). A showing of bad faith
requires the plaintiff to demonstrate that a “party purposely loses or destroys
relevant evidence.” Id. Mere negligence in destroying evidence is not sufficient to
justify striking an answer. See Mann v. Taser Int’l, Inc., 588 F.3d 1291, 1310
(11th Cir. 2009). In determining whether to impose sanctions for spoliation, “[t]he
court should weigh the degree of the spoliator’s culpability against the prejudice to
the opposing party.” Flury, 427 F.3d at 946. “The Eleventh Circuit has discussed
and relied on Georgia state law in spoliation cases, even though federal law applies
to the issue of spoliation sanctions, because ‘Georgia state law is wholly consistent
with federal spoliation principles.’” Wilder v. Rockdale Cty., No. 1:13-CV-2715RWS, 2015 WL 1724596, at *3 n.1 (N.D. Ga. Apr. 15, 2015) (quoting
Flury v. Daimler Chrysler Corp., 427 F.3d 939, 944 (11th Cir. 2005)).

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B.

Analysis

H&F argues that it cannot be held liable for any alleged spoliation of
evidence because the undisputed facts show that the truck, and thus the ECM data
at issue, was not in its possession, custody, or control on August 14, 2014, when
the ECM data was reset. The Court agrees. “It is axiomatic that in order for there
to be spoliation, the evidence in question must have existed and been in the control
of a party.” Wilder v. Rockdale Cty., No. 1:13-CV-2715-RWS, 2015 WL
1724596, at *3 (N.D. Ga. Apr. 15, 2015) (quoting Sentry Select Ins. Co.
v. Treadwell, 734 S.E.2d 818, 848 (Ga. Ct. App. 2012)). Here, it is undisputed that
H&F leased the truck from Salem. On August 11, 2014, H&F returned the truck to
Salem. On August 14, 2014, when the ECM data was reset by Salem, the ECM
data was in the exclusive control of Salem. Plaintiff’s Renewed Sanctions Motion
is denied with respect to H&F.
Salem argues that Plaintiff failed to establish spoliation, including because
litigation was not reasonably foreseeable on August 14, 2014, when the ECM data
was reset. “[I]n order for the injured party to pursue a remedy for spoliation, the
spoliating party must have been under a duty to preserve the evidence at issue.”
Phillips v. Harmon, 774 S.E.2d 596, 603 (Ga. 2015). This duty arises when, from
the perspective of the party in control of the evidence, litigation is reasonably

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foreseeable. Id. at 604. For the defendant, “the duty arises when it knows or
reasonably should know that the injured party, the plaintiff, is in fact
contemplating litigation, which the cases often refer to in terms of ‘notice’ to the
defendant.” Id. Notice of litigation may be actual or constructive. Id. at 605.
Constructive notice may be based on a variety of circumstances, including
“the type and extent of the injury; the extent to which fault for the injury is clear;
the potential financial exposure if faced with a finding of liability; the relationship
and course of conduct between the parties, including past litigation or threatened
litigation; and the frequency with which litigation occurs in similar circumstances.”
Id. The Court may also consider “not only what the plaintiff did or did not do after
the injury and before the evidence in question was lost or destroyed, but also what
the defendant did or did not do in response to the injury, including the initiation
and extent of any internal investigation, the reasons for any notification of counsel
and insurers, and any expression by the defendant that it was acting in anticipation
of litigation.” Id. However, “the mere fact that someone is injured, without more,
is not notice that the injured party is contemplating litigation sufficient to
automatically trigger the rules of spoliation.” Id. at 604. “The defendant’s duty
also does not arise merely because the defendant investigated the incident[.]” Id. at
605 n.9 (emphasis in original).

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Here, Plaintiff argues “Defendants cannot dispute that they anticipated
litigation on August 18, 2014.” ([221] at 15). The question, however, is whether,
from Salem’s perspective, litigation was reasonably foreseeable on
August 14, 2014, when the alleged spoliation occurred. The Court finds it was not.
The investigating officer on the day of the Collision found Plaintiff at fault for
causing the Collision, and Plaintiff told the officer “he did not know what he was
thinking running the red light.” ([223] at 2-3). Salem presents evidence that, even
as late as August 25, 2014, it was under the impression that there was no dispute as
to whether Plaintiff caused the Collision, and that it attempted to have Plaintiff’s
insurance company cover the damage caused to Salem’s truck. ([223] at 4, 12).
The evidence is, based on the information available to Salem, that Plaintiff was not
contemplating action against Salem.
Plaintiff next claims “Defendants’ investigations of the accident show that
they knew litigation as likely.” ([221] at 15). Plaintiff, however, does not identify
what actions either H&F or Salem took on or before August 14, 2014, that might
qualify as an “investigation.” Assuming Plaintiff refers to the August 14, 2014,
maintenance inspection, Salem presents evidence that such inspections are
performed on all commercial vehicles that have been leased and returned. (See
[223] at 11). In sum, Plaintiff fails to present any evidence to show that Salem was

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on notice that it was reasonably foreseeable on August 14, 2014, that Plaintiff was
anticipating litigation against Salem. “[T]he mere fact that someone is injured,
without more, is not notice that the injured party is contemplating litigation
sufficient to automatically trigger the rules of spoliation.” Phillips, 774 S.E.2d at
604. Plaintiff’s Renewed Sanctions Motion is denied with respect to Salem.
Finally, to the extent Plaintiff bases his spoliation claim on Defendants’
alleged falsification of data to support Bethea’s expert report, and their alleged
concealment of their misconduct from Plaintiff and the Court, Plaintiff’s claim
rests on the assumption that Salem or H&F was aware that the ECM data was
reset. The Court finds Plaintiff presents only speculation that either Salem or H&F
was aware of this fact. In the absence of evidence of bad faith, the Court declines
to award sanctions for spoliation. See Bashir, 119 F.3d at 931.
III.

CONCLUSION
For the foregoing reasons,
IT IS HEREBY ORDERED that Plaintiff Gregory Wiedeman’s Renewed

Motion for Sanctions Against Defendants H&F Transfer, Inc. and Salem Leasing
Corporation [221] is DENIED.

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SO ORDERED this 9th day of June, 2017.

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