Arcelormittal Indiana Harbor LLC v. Amex Nooter LLC

Filing 171

OPINION AND ORDER: The Court hereby DENIES Amex Nooter, LLC's Motion for Summary Judgment on its First Affirmative Defense 139 , and DENIES the Petition for Oral Argument 141 . Signed by Magistrate Judge Paul R Cherry on 12/20/2017. (jss)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
ARCELORMITTAL INDIANA HARBOR )
LLC and ARCELORMITTAL USA LLC, )
Plaintiffs,
)
)
v.
)
)
AMEX NOOTER, LLC,
)
Defendant.
)

CAUSE NO.: 2:15-CV-195-PRC

OPINION AND ORDER
This matter is before the Court on Amex Nooter, LLC’s Motion for Summary Judgment on
its First Affirmative Defense [DE 139] and a Petition for Oral Argument [DE 141], both filed by
Defendant Amex Nooter, LLC (“Amex Nooter”) on September 28, 2017. Plaintiffs ArcelorMittal
Indiana Harbor LLC and ArcelorMittal USA LLC (collectively “ArcelorMittal”) filed a response
on October 26, 2017, and Amex Nooter filed a reply on November 9, 2017. The parties filed forms
of consent to have this case assigned to a United States Magistrate Judge to conduct all further
proceedings and to order the entry of a final judgment in this case. Therefore, this Court has
jurisdiction to decide this case pursuant to 28 U.S.C. § 636(c).
On April 3, 2013, a fire occurred at Blast Furnace No. 3, a part of ArcelorMittal’s Indiana
Harbor Facility, while employees of Amex Nooter were rebuilding the excess gas bleeder pilot
burner cabinets pursuant to a contract with ArcelorMittal. In the Amended Complaint brought
against Amex Nooter based on theories of negligence and breach of contract, ArcelorMittal seeks
approximately $3.2 million in property damage and excess fuel costs as a result of the fire. In the
instant motion, Amex Nooter seeks summary judgment in its favor on its First Affirmative Defense
titled “ArcelorMittal’s Spoliation of Evidence,” which alleges:

Following the April 3, 2013 incident, ArcelorMittal denied Amex Nooter
access to the work site that evening and did not permit Amex Nooter access to the
work site until approximately noon the following day, at which time any evidence
and artifacts of the incident had been cleaned up and disposed. ArcelorMittal had a
duty to maintain evidence and artifacts of the incident and failed to do so.
ArcelorMittal’s failure to maintain any evidence of the incident materially prejudiced
Amex Nooter’s ability to fully investigate the April 3, 2013 incident and the basis
of ArcelorMittal’s asserted claims. The cleanup and disposal of physical evidence
and artifacts, substantially and materially, impaired and precluded Amex Nooter’s
ability to fully and completely defend against any claims and assertions made against
it.
(ECF 117, p. 28). In the instant motion, Amex Nooter argues that it is unable to defend itself because
ArcelorMittal intentionally discarded evidence in violation of its duty to preserve evidence and,
therefore, ArcelorMittal’s claims should be dismissed with prejudice. In addition to addressing the
merits of Amex Nooter’s spoliation argument, ArcelorMittal also asserts that the instant motion
should be denied as procedurally improper because the relief sought should be pursued in the context
of requesting sanctions.
Spoliation is not properly addressed as an affirmative defense but rather should be addressed
as an evidentiary and/or discovery matter, such as through a motion for sanctions. Courts that have
considered whether spoliation is an affirmative defense have consistently found that it is not. The
Fourth Circuit Court of Appeals explained that, “while the spoliation of evidence may give rise to
court imposed sanctions deriving from [the court’s] inherent power, the acts of spoliation do not
themselves give rise in civil cases to substantive claims or defenses.” Silvestri v. Gen. Motors Corp.,
271 F.3d 583, 590 (4th Cir. 2001); see also Vodusek v. Bayliner Marine Corp., 71 F.3d 148, 155-56
(4th Cir. 1995) (“Even though application of the [spoliation] rule could prove to be critical to a
party’s recovery on a claim, it is not an affirmative defense, but a rule of evidence, to be
administered at the discretion of the trial court. Consequently, a party need not indicate its intent to

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invoke the spoliation rule in the pleadings.”); BCOWW Holdings, LLC v. Collins, SA-17-CA-379,
2017 WL 4082686, at *4 (W.D. Tex. Sept. 15, 2017) (citing Vodusek, 71 F.3d at 155-56); Travelers
Prop. Cas. Co. of Am. v. All Seasons Roofing Inc., No. 4:15-CV-412, 2016 WL 8730570, at *1 (E.D.
Ark. Sept. 9, 2016) (holding that spoliation is not an affirmative defense but rather an evidentiary
doctrine that can be used as a “spear” by seeking the sanction of dismissal (citing Sherman v.
Richem Co. Inc., 687 F.3d 996, 1006 (8th Cir. 2012)); Bonilla v. Rexon Indus. Corp., 1:13-CV-1830,
2015 WL 10792026, at *10-11 (S.D. Ind. Aug. 19, 2015) (recognizing that, although spoliation is
not an independent tort in Indiana, Indiana law allows courts to fashion remedies for spoliation,
including the establishment of a factual inference that the spoliated evidence would be unfavorable
to the party responsible, but not treating spoliation as an affirmative defense); Griffin v. Acadia
Healthcare Co., Inc., 1:14-CV-1573, 2015 WL 11367927, at *3 (N.D. Ga. Apr. 28, 2015) (finding,
on a motion to add spoliation as an affirmative defense, no support in Georgia law that spoliation
is an affirmative defense and noting that the several courts that have addressed the issue have held
that spoliation is not an affirmative defense (citing Vodusek, 71 F.3d at 155-56; ABC Bus. Forms,
Inc. v. Pridamor, Inc., No. 09 C 3222, 2009 WL 4679477, at *3 (N.D. Ill. Dec. 1, 2009) (quoting
Silvestri, 271 F.3d at 590); Flury v. Daimler Chrysler Corp., 427 F.3d 939, 944 (11th Cir. 2005)));
Ross v. Kopocs, No. 1:14-CV-60, 2015 WL 926580, at *3 (E.D. Tenn. Mar. 4, 2015) (holding that
spoliation is not an affirmative defense but rather a rule of evidence (citing Vodusek, 71 F.3d at 15556; ABC Bus. Forms, Inc., 2009 WL 4679477, at *3; Silvestri, 271 F.3d at 590; Forest Labs, Inc.
v. Caraco Pharm. Labs, Ltd., No. 06-CV-13143, 2009 WL 998402, at *1 (E.D. Mich. Apr. 14, 2009)
(quoting Hodge v. Wal-Mart Stores, Inc., 360 F.3d 446, 450 (4th Cir. 2004)); Tenet Healthsystem
Desert, Inc. v. Fortis Ins. Co., Inc., 520 F. Supp. 2d 1184, 1198 (C.D. Cal. 2007); Donohoe v. Am.

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Isuzu Motors, Inc., 155 F.R.D. 515, 520 (M.D. Pa. 1994))); Allstate Ins. Co. v. Long Island Power
Auth., No. 14-CV-444, 2015 WL 867064, at *3 (E.D.N.Y. Feb. 27, 2015) (quoting Sparta Ins. Co.
v. Colareta, No. 13-CV-60579, 2013 WL 5588140, at *6 (S.D. Fla. Oct. 10, 2013) (citing Donohoe,
155 F.R.D. at 520)); Sparta Ins. Co., 2013 WL 5588140, at *6; Holley v. Evangelical Lutheran Good
Samaritan Soc’y, CIV 12-0320, 2012 WL 12903865, at *2-3 (D.N.M. Sept. 14, 2012) (declining to
find spoliation to be an affirmative defense under New Mexico law); ABC Bus. Forms, Inc., 2009
WL 4679477, at *3 (quoting Silvestri, 271 F.3d at 590); Berger v. Cleveland Clinic Found., No.
1:05cv1508, 2007 WL 2902907, at *12 (N.D. Ohio Sept. 29, 2007) (“[S]poliation of evidence is not
an affirmative defense . . . .”); Tenet Healthsystem Desert, Inc., 520 F. Supp. 2d at 1198 (recognizing
that, under California law, spoliation by a party to an action is not a separate tort or claim and the
parties are limited to evidentiary and discovery remedies (citing Cedars-Sinai Med. Ctr. v. Super.
Ct., 954 P.2d 511 (1998); Hodge, 360 F.3d at 449-50).
Some decisions have denied a motion to strike an affirmative defense or granted a motion
to amend an answer involving spoliation labeled as an affirmative defense but have done so without
directly addressing whether spoliation is in fact an affirmative defense. See, e.g., Garrison v. Foster
Poultry Farms Inc., CV-16-280, 2016 WL 3753529, at *1 (D. Ar. July 14, 2016) (motion to strike);
Foster v. Bridgestone Ams., Inc., Civ. Action No. 11-175, 2012 WL 266479, at *2 (S.D. Ala. Jan.
30, 2012) (motion to amend answer); QBE Ins. Corp. v. Jorda Enters., Inc., 277 F.R.D. 676, 696
(S.D. Fla. 2012) (finding 30(b)(6) deposition testimony relevant to the “affirmative defense
advocating a spoliation theory”); Schmidt v. Pentair, Inc., No. C08-4589, 2010 WL 4607412, at *1
(N.D. Cal. Nov. 4, 2010) (motion to strike). And, in some jurisdictions, courts have ruled on a
plaintiff’s motion for summary judgment on a defendant’s affirmative defense of spoliation, again

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without directly considering whether spoliation is an affirmative defense but rather by discussing
spoliation in the context of sanctions and/or adverse inferences. See, e.g., Constr. Sys., Inc. v. Gen.
Cas. Co. of Wis., Civ. No. 09-3697, 2011 WL 3625066, at *15 (D. Minn. Aug. 17, 2011) (citing
Hoffman v. Ford Motor Co., 587 N.W.2d 66, 71 (Minn. Ct. App. 1998) (noting a court may impose
sanctions for spoliation based upon the prejudice caused to the opposing party)); Morris v.
Mitsubishi Motors N. Am., Inc., 782 F. Supp. 2d 1149, 1162 (E.D. Wash. 2011); Longview Fibre Co.
v. CSX Transp., Inc., 526 F. Supp. 2d 332, 340 (N.D.N.Y. 2007).
In the instant diversity action, the legal and factual sufficiency of an affirmative defense is
examined with reference to Indiana state law. See Williams v. Jader Fuel Co., Inc., 944 F.2d 1388,
1400 (7th Cir. 1991). There does not appear to be any published decision from an Indiana state court
addressing whether spoliation can be pleaded as an affirmative defense. However, the Indiana
Supreme Court decision in Gribben v. Wal-Mart Stores, Inc., 824 N.E.2d 349 (Ind. 2005), is
instructive. In Gribben, the Indiana Supreme Court considered the question, certified from the
United States District Court for the Southern District of Indiana, of whether “Indiana law recognizes
a claim for ‘first-party’ spoliation of evidence; that is, if an alleged tortfeasor negligently or
intentionally destroys or discards evidence that is relevant to a tort action, does the plaintiff in the
tort action have an additional cognizable claim against the tortfeasor for spoliation of evidence?”
824 N.E.2d at 350. The Indiana Supreme Court answered the question in the negative. Id. at 355.
In holding that there is no “first party” liability for spoliation, the court noted that “important
sanctions” already exist under Indiana law that provide both a remedy to persons aggrieved as well
as deterrence. Id. at 351. The court explained, “It is well-established in Indiana law that intentional
first-party spoliation of evidence may be used to establish an inference that the spoliated evidence

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was unfavorable to the party responsible.” Id. (citing Cahoon v. Cummings, 734 N.E.2d 535, 545
(Ind. 2000); Underwood v. Gale Tschuor Co., Inc., 799 N.E.2d 1122, 1134 (Ind. Ct. App. 2003);
Porter v. Irvin’s Interstate Brick & Block Co., Inc., 691 N.E.2d 1363, 1364 (Ind. Ct. App.1998);
Doug Cressler, Spoliation of Evidence, 36 Res Gestae 510 (1993)). The court also recognized the
discovery sanctions available under Indiana Trial Rule 37, including dismissal of an action or default
judgment. The court reasoned, “Notwithstanding the important considerations favoring the
recognition of an independent tort of spoliation by parties to litigation, we are persuaded that these
are minimized by existing remedies and outweighed by the attendant disadvantages.” Id. at 355
(relying, in part, on the reasoning of the California Supreme Court in Cedars-Sinai Med. Ctr., 954
P.2d at 515).
In this case, although Amex Nooter is not asserting a claim (or rather a counterclaim) of
spoliation, Amex Nooter’s invocation of spoliation falls within the category of “first party”
spoliation because ArcelorMittal is a party to this litigation; “third party” spoliation refers to
“spoliation by a non-party.” Gribben, 824 N.E.2d at 350; see also Howard Reg’l Health Sys. v.
Gordon, 952 N.E.2d 182, 188 (2011). And, even though Amex Nooter is in the role of a tortfeasor
attempting to use spoliation as a sword through an affirmative defense rather than a plaintiff
attempting to use spoliation as a claim against the tortfeasor like in Gribben, the reasoning in
Gribben applies with equal force in that existing remedies through the use of sanctions, ranging from
limiting instructions to dismissal, are sufficient to address the harm of spoliation by a plaintiff. Like
Indiana Trial Rule 37, Federal Rule of Civil Procedure 37 makes available various sanctions as does
the Court’s inherent authority.

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The only case cited by Amex Nooter to support its assertion that spoliation is an affirmative
defense is Wilson v. Tariq, 2:15-CV-321, 2016 WL 5956410 (N.D. Ind. Oct. 13, 2016), which
denied a Rule 12(f) motion to strike a spoliation affirmative defense. However, the court in Wilson
was faced with a motion to strike in the early stages of the proceedings, not a motion for summary
judgment. And, citing Gribben, the court in Wilson discussed spoliation in terms of it being “wellestablished in Indiana law that intentional first-party spoliation of evidence may be used to establish
an inference that the spoliated evidence was unfavorable to the party responsible.” Id. at *4. That
the affirmative defense was not stricken under those circumstances in Wilson does not change this
Court’s analysis on the instant motion.
In the substantive portion of its brief addressing the merits of the spoliation argument, Amex
Nooter cites two Indiana state law cases in which the issue of spoliation was raised in litigation with
ArcelorMittal. In both instances, spoliation was addressed in the context of a motion for sanctions
and a motion to preserve evidence and not as an affirmative defense. See WESCO Distrib., Inc. v.
ArcelorMittal Indiana Harbor LLC, 23 N.E.2d 682, 701-06 (Ind. Ct. App. 2014) (considering the
plaintiff’s motion for sanctions brought under Indiana Trial Rule 37, including a request for the
sanction of dismissal, and affirming both the trial court’s decision declining to impose a discovery
sanction upon a finding of no intentional conduct by ArcelorMittal that amounted to spoliation and
the trial court’s decision not to give an adverse inference instruction); Haraburda v. ArcelorMittal,
No. 2:11-CV-93, 2011 WL 2600756 (N.D. Ind. June 28, 2011).
Accordingly, the Court denies the instant motion solely on the basis that Amex Nooter has
filed a motion for summary judgment on an affirmative defense of spoliation rather than seeking
sanctions for the alleged spoliation. In the instant motion, Amex Nooter explicitly states that it is

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not “seeking a discovery sanction in this Motion” and “reserves the right to seek appropriate
sanctions, adverse jury instruction(s), or otherwise move in limine.” (ECF 140, p. 13, p. 13 n.12).
In light of Amex Nooter’s representation and to afford Amex Nooter the opportunity to make all
arguments related to a request for sanctions based on spoliation in one motion, the Court declines
to address the merits of the spoliation argument set out in the instant briefs and instead grants Amex
Nooter leave to file an appropriate motion, if so desired.
CONCLUSION
Based on the foregoing, the Court hereby DENIES Amex Nooter, LLC’s Motion for
Summary Judgment on its First Affirmative Defense [DE 139], and DENIES the Petition for Oral
Argument [DE 141].
SO ORDERED this 20th day of December, 2017.
s/ Paul R. Cherry
MAGISTRATE JUDGE PAUL R. CHERRY
UNITED STATES DISTRICT COURT

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