Ottoson v. SMBC Leasing and Finance, Inc. et al

Filing 80

OPINION re: 55 MOTION for Sanctions against Plaintiff Maureen Ottoson, filed by Lisa Savinon, SMBC Leasing and Finance, Inc., David Ward. The motion of the Defendants for an adverse inference is granted, and their application for fees and costs is adjourned to the settlement of final judgment. Defendants' motion for sanctions against Plaintiff is granted, an adverse inference instruction will be given, and the application for fees and costs is adjourned, and as further set forth herein. (Signed by Judge Robert W. Sweet on 7/13/2017) (ras)

UN I TED STATES DIS TRICT COURT
SOUTHERN DISTRICT OF NEW YORK

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MAUREEN OTTOSON ,
Plaintiff ,
- against -

13 Civ . 1521

OPINION

SMBC LEASING AND FINANCE , INC .,
DAVID WARD and LISA SAV I NON ,
Defendants.
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A P P E A RA N C E S :
Attorneys for Pla i ntiff
COREY STARK PLLC
110 East 59 th Street , 22nct Floor
New York , NY 10022
By : Corey Stark , Esq .

Attorneys for Defendants
PROSKAUER ROSE LLP
11 Times Square
New York , NY 10036
By : Andrew E . Rice , Esq .
Lloyd B . Chinn , Esq .

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Sweet , D . J.

Defendants SMBC Leasing and Finance, Inc .
David Ward ("Ward " ) , and Lisa Savinon ("Savinon")

("SMBCLF") ,

(collectively ,

the "Defendants") have moved pursuant to Rule 37 of the Federal
Rules of Ci vil Procedure for sanctions to be imposed upon
plaintiff Maureen Ottoson ("Ottoson" or the "Plaintiff") for
spoliation of evidence , specifically seeking an adverse
inference instruction, and fees and costs .

For the reasons set forth below, the motion of the
Defendants for an adverse inference is granted , and their
app l ication for fees and costs is adjourned to the settlement of
final judgment .

I.

Prior Proceedings

Plaintiff filed this action accusing Defendants of
discrimination based on a perception of disability arising from
a report allegedly in SMBCLF ' s possession on March 2 , 2013 .
Plaintiff was employed by SMBCLF as an Assistant Vice President
performing contract administration from April 30 , 2012 through
August 1, 2012 . Plaintiff ' s Complaint ( "Compl . ")

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2 5 , 2 6.

On July 9 , 2012, Plaintiff ' s then - counsel Jesse Rose
("Rose") sent a demand letter to Defendants' Human Resources
Department threatening litigation and requesting Plaintiff ' s
personnel file . Declaration of Andrew E. Rice [hereinafter,
"Ri ce Deel ."], Ex. X (Rose Letter to Smith). Plaintiff alleges
that on or around August 31 , 2012 , she filed a Charge of
Discrimination with the U. S . Equal Employment Opportunity
Commission ("E EOC"), and that she received a Notice of Right to
Sue dated January 31 , 20 13. Compl.

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4-5 .

The Complaint alleges that subsequent to her hire ,
SMBCLF performed a background check on Plaintiff , the results of
which included a "governme nt / insurance rep o rt"

(the "Rep ort " )

that contained "inaccurate and defamatory information about
Ottoso n, her home, and her state of mind." Compl .

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20 ; 29 .

Pl aintiff testified during her deposition that she fi rst learned
of the existence o f this Report in the 1980s. Rice Dee l., Ex . C
(Relevant Excerpts of Plaintiff ' s May 2014 and September 20 15
Depositions)

[hereinafter , "Tr ." ] , at 538 : 7 - 9 . Plaintiff alleges

that De fendants "formed the inac curate belief that Ottoson
suffers from a mental impairment and disability " based on the
contents of the alleged Report . Compl .

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30 , 48 . Plaintiff

further alleges that she was terminated based on SMBC LF' s
misperception that she was disabled , and in retaliation for
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complaining about discrimination based on perceived disability .
Id .

~~

47 , 49 .

Plaintiff stated at her deposition that , as of
November 2013 , eight months after she filed this lawsuit , she
had no proof that the Report existed . Tr . at 596 : 17-19 . Despite
issuing more than a dozen subpoenas to past employers and
others , Plaintiff failed to receive the Report. Rice Deel.

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23;

see Tr . 596:8 - 11 ("Q .. . So as of November 2013, you had not
obtained the report from any source, correct? A. No ,

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didn ' t ." ) . Defendants have repeatedly denied having ever seen or
received the Report , and have stated under penalty of perjury
that they did not, and do not, possess the Report.

See , e . g .,

ECF No . 33 ; Rice Deel. , Ex . V (Excerpts of Deposition of
Defendant David Ward) at 82 , 88-91 ; Rice Deel ., Ex . W (Excerpts
of Deposition of Defendant Lisa Savinon) at 86 - 87 , 107-09.

In light of Plaintiff ' s allegations, on November 21 ,
2013 , Defendants propounded requests in their First Request for
the Production of Documents that either specifically or
generally called for the production of documents concerning the
Report and/or Plaintiff ' s communications concerning the Report ,
including :

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"documents memorializing communicat i ons with any
individual , including but not limited to any current
or former employees of SMBCLF , concerning the
Comp l aint o r any of [ Pl a i ntiff ' s ] a ll egations in this
action " (Request No . 14) ;
"documents, including , but not limited to , emails,
instant messages , text messages or other messages on
any social media or networking website in
[P l aintiff ' s] possession , custody or control
concerning SMBCLF or the allegations in this
Complaint" (Request No. 15) ;
" documents that contain [Plaintiff ' s] records , notes ,
descriptions , conversations , discussion or thoughts
concerning the allegations in the Complaint " (Request
No . 16) ;
" documents concerning the ' Report ' identif i ed in
Paragraph 18 of the Comp l aint " (Request No . 19) ;
" documents concern i ng the allegation i n Paragraph 18
of the Complaint t hat '[ a]f t er Ms . Ottoson ' s
employment ended , JOHN DOE2 disclosed to Ms. Ottoson
the existence of a government/insurance report .
given the JP Morgan ' s Human Resource department
conta i n i ng a background check of Ms . Ottoson along
wi th a comprehens i ve employment summary & many
negative persona l references " (Request No . 20) ;
" documents written or prepared by , to , from ,
concerning , or concerning any communications with any
potential witnesses in this action and/or any persons
mentioned in the Complaint" (Request No . 63);
" written or recorded statements , op i n i ons , and
reports , the information for which h as been obta in ed
from any individua l or entity contacted or interviewed
in connection with t hi s action (inc l uding dra f ts of
such statements , opin i ons , and/or reports)
"
(Request No. 64) ;
" statements , in whatever form , from third parties
concerning [ Plaint i ff ' s ] allegations in this action"
(Request No . 71) ; and
" documents concern i ng , referring or relating to the
subject matter of this action , the allega t ions in the
Complaint , and/or the damages or ot h er relief sought
4

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in the Complaint, that have not been produced in
response to the above requests" (Request No . 73 ) .

Rice Deel ., Ex . A. These requests unquestionably encompassed
written communications Plaintiff may have had with witnesses
concerning the alleged Report .

Plaintiff produced documents concerning the Report in
response to Defendants '

Fi rst Request for the Production of

Documents. In particular , on December 23 , 2013, Plaintiff
produced signed statements from three former co-workers , not
from SMBCLF , who purported in such statements to have viewed the
Report years before her employment at SMBCL F: Ralph Berger (" Mr.
Berger") , Philip Weinstock ("Mr. Weinstock") , and Francesca
Aversa (" Ms . Aversa " ). Rice Deel ., Ex . D (Berger Statement
executed January 9 , 2013) ; Ex . E (Aversa Statement dated
November 24 , 2 012) ; Ex . F (Weinstock Statement dated January 31 ,
20 1 3) . On March 31 , 2014 , Plaintiff produced , via email from
Rose , " addenda " from Mr . Berger and Ms . Aversa . Rice Deel. , Ex .
H (Rose Email to Rice) ; Ex . I
dated Ma r ch 18 , 2014) ; Ex . J

(Addendum to Berger Statement
(Addendum to Aversa Statement dated

March 11 , 2014) .

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)

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One of the three individuals , Mr. Berger , later
directly provided Defendants with numerous email communications
that he had with Plaintiff concerning the written statements
that he provided to her . Rice Deel .

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8 ; Exs . K- S . In one email ,

Plaintiff directs Mr. Berger to " JUST COPY & PASTE & PLEASE TYPE
THE WORK " ADDENDUM " ON TOP AS FOLLOWS. " Rice Deel ., Ex . Q
(Ottoso n- Berger emai l dated Marc h 1 4 , 20 1 4) . I n a n other ema il to
Mr. Berger , Plaintiff tells him to "[ p ] lease write the following
statement below in the fol l owing format ." Rice Deel ., Ex . P
(Ottoson - Berger email dated March 10 , 2014) ; see also Rice
Deel. , Ex. 0

(Ottoson - Berger email dated February 1 , 20 1 4)

( " In

case Jesse [Rose ] speaks to him again , p l ease tell him Bond i ng
Insurance because that is what your notarized letter to him
stated ." ) .

Even after she was on notice that Defendants had
received documents from Mr. Berger , Pl a i nt i ff did not produce
any communications with the three witnesses or drafts of their
statements . Rice Deel .

~~

6 , 21 ; Exs . T- U. Further , to the

extent that Plaintiff was no longer in possession or control of
such documents , Pl aint i ff fai l ed to prov i de any explanat i on or
information about such documents or the c i rcumstances of their
loss , as required by Defendants '
for Production. Rice Dee l.

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instruct i ons to their Request

6 ; Ex. A .

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Defendants informed the Court by letter dated April
24, 20 1 5, ECF Nos . 34-35 , about the serious quest i ons concerning
Plaintiff ' s conduct in this matter, as was then relevant to
Plaint i ff ' s motion to compel a Rule 30(b) (6) deposition.
Defendants also wrote to Plaintiff ' s counsel , on April 27 , 2015 ,
to demand supplemental responses to Defendants '

First Request

for the Production of Documents concerning Plaintiff ' s
communications about the Report . Rice Dee l . , Ex . T . Plaintiff
did not formally respond to the April 27 l etter for several
weeks , and the parties met and conferred by telephone concerning
a potential motion to compel by Defendants on May 18 , 2015. Rice
Deel .

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19-20 . During that call , Plaintiff's counsel agreed to

produce Plaintiff for further deposit i on . Id .

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20 . Later that

day , Plaintiff ' s counsel served a letter stating that Plaintiff
had "not ident i fied any responsive documents within her
possession or control ," and that Plaintiff ' s counsel was " not
aware of evidence that suggests that Plaintiff destroyed any
documents whatsoever on or after the date that she commenced
this action ." Rice Deel ., Ex . U.

On September 10 , 2015 , the parties submitted a
Stipulation and Proposed Order that was so - ordered by the Court .
ECF No . 38 . This Stipulation , inter alia , extended the end date
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of discovery , extended other relevant deadlines , and provided
that Defendants reserve their rights to take further discovery
or engage in motion practice arising out of Plaintiff's
continued deposition . Id .

Plaintiff appeared for a continued deposition on
September 29 , 2015 . During her deposition, defense counse l

asked

Plaintiff about her email practices and she admitted to having a
" habit " to "automatically" delete her email . Tr . 632 : 18-22 . The
following exchange established Pl aintiff ' s ongoing deletion of
her email :
Q.

. .. And so , with respect to e -mail , e -mail s that
you sent to and from other people , perhaps Mr .
Berger , Ms. Aversa , Mr. Weinstock , and others ,
about your claims, did you make any attempt to
preserve , to keep those e-mails , prior to
commencing your lawsuit against SMBC?

A.

I don ' t

Q.

You don ' t

A.

No.

Q.

And so , then it's possible that you had e-mail
exchanges prior to December of 2013 re l ating to
your claims that you deleted because you didn't
think that there was any necessity that you keep
them for this lawsuit?

A.

I don ' t recall that .

Q.

Well , let me ask you this: Was it your practice
to delete e -mail?

recall so .
recall doing so?

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A.

It ' s a habit to do that if it ' s -- you know , I do
that automatically . I'm pretty particular about
that.

Q.

So prior to December of 2013 , did you take any
steps to change your habits in that regard and
keep e - mails that related to your claims against
SMBC?

A.

Prior to December ,

Q.

You don ' t recall making any effort to keep e mails prior to December of 2013?

I don ' t

recall specifically .

MR . STARK : Objection to form. You can answer.
A.

I don ' t

recall anything .

Q.

Okay . I'm not sure what that means . Did you take
any steps prior to December '1 3 t o change your
normal habit of deleting e - mails so that you
would keep any documents relat in g to your claims
against SMBC?

A.

I don ' t recall anything to what you had just
stated .

Q.

You don ' t recall doing anything to change your
normal habits?

MR . STARK : Objection to form .
A.

I don ' t

recall .

Q.

You don't recall doing anything to change yo ur
norma l habits?

A.

I don ' t

Q.

Okay . So , then , you may well have continued , t o
the best of your recollection , until December of
' 13 , you continued deleting you r e-mail whether
it had anyth ing to do with this case or not?

recall.

MR. STARK: Objection to form.

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A.

If you don ' t recall , you don ' t recall . So I
cannot answer that question if I truly do not
recall .

Q.

So you don ' t remember one way or another whether
you changed this habit of yours by which you
would routinely delete e - mails , you don ' t know
whether you did or didn ' t change that approach
until December of 2013?

A.

I don ' t

Q.

Now , after December of 2013 , did you make any
changes in your e - mai l deletion h abits?

A.

That I don ' t

Q.

Let me ask you this : Have you ever , dur i ng any
time while your EEOC charge was pending against
SMBC , or after your lawsuit was f iled, have you
ever changed your practice with respect to
de l et i ng al l of your e - ma il s?

recall .

remember .

MR . STARK : Objection to the form .
A.

I don ' t

remember .

Q.

Have you ever done anything at any time to be
carefu l about preserv i ng electronic
communications , e - mails , relating to your claims
against SMBC?

A.

I understand your question , but I don ' t

Q.

So how about since April of this year? Have you
taken any steps s i nce Apri l of 2015 to ensure
that you're not delet i ng e l ectronic documentation
that relates to your claims aga i nst SMBC?

A.

I don ' t

Q.

How about yesterday?

A.

I don ' t

Q.

How about last month? Di d you do anything last
month , in August , to make sure you weren ' t

recall.

remember .

remember .

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deleting communications relating to this lawsuit
against SMBC?
A.
Q.

Is there any time ever that you remember doing
anything at all to make sure you weren't deleting
documents related to this l awsuit?

A.

Tr.

I don't recall.

No , I don't recall.

631 : 23-636:7 .

When asked whether she had specific ema ils with Mr .
Berger , the Plaintiff stated that she did not have any of them ,
but acknowledged that the emails concerned Mr . Berger preparing
a statement to supp ort her in this litigation. Plaintiff was
asked about Exhibit K, the email chain dated November 6 and 8 ,
2013 :
Q.

Did you at that time retrieve this e-mail (indicating)
from Mr . Berger and provide it to counsel?

A.

No , I didn't .

Q.

And then , more recently, you ' re
that is SMBC, has requested all
it has obtained from Mr. Berger ,
you produce them , right? You're

A.

Yes , I am.

Q.

You haven ' t turned over any further e - mails, have you?

A.

There was nothing in my in-box or "sent" folder.

Q.

While you had an EEOC charge pending against SMBC
and counsel , what happened to this e-mail?

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aware that we have ,
of these e-mails that
it's requested that
aware of that?

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'

A.

I don't recall. It definitely was not in my in - box as
of December 2013 or "s ent " folder."

Tr. 580 : 7 -1 7 ; 580 : 24 -581:5.

Plaintiff was asked if she had the emails in Exhibit
L , the email chain dated November 5 and 6 , 2013 :
Q.

. . . d id you look for these documents to see if you had
them?

A.

I did l ook .

Q.

And you did not have them?

A.

I did not have them.

Q.

And you did not turn them over?

A.

I did not have them.

Tr . 590:17 - 23.

When Plaintiff was asked whether she had Exhibit M,
the emai l chain dated November 8 - 10, 2013 , she stated "I recall
looking for them [the emails co nstituting Exhibit M] when [Mr.
Stark ] did ask me . But nothing was there ." Tr.

614 :14-15.

Plaintiff testified that she has Mr. Berger ' s email address , Tr.
552 : 19-20 , that her email address is on the emails with Mr .
Berger, Tr. 581:6-11 , that she sends ema ils to Mr . Berger , Tr .
577:4 - 7 , that she was " communicat ing with Mr. Berger about the
preparation of a statement for [her], " Tr . 588 : 7 - 11 , and that
she believed it was "possible" that she sent these emails to Mr .

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Berger, see, e.g ., Tr. 581 :1 6 , 588 : 6, 589 : 4 . Plaintiff ' s
explanation for not producing these emails was that she "does
not recall " sending or recei v ing the emails to Mr . Berger. See,

e . g ., Tr. 581 :1 9 , 588:2, 588:18.

Defense counsel asked whether Plaintiff had exchanged
emails with Mr . Berger since April 2015 . Plaintiff replied , "I
don't recall." Defense counsel continued, "If you had, would
they be in your possession? " Plaintiff asked , " You mean today? "
Defense counsel : "Correct ." Plaintiff ' s counsel interjected, "At
your home, not with you ." Plaintiff replied, "That would be
correct ." Defense counsel: "They would be in your possession?"
Plaintiff : "I would imagine they would be. But I believe-no,
because I don't have it. I don ' t remember. " Tr. 680:15 - 681 :5.

When asked whether she "actually searched for and
produced some documents in response to [Defendants '

December

2013 document requests] ," Plaintiff replied , " Whatever I had I
gave [Mr. Rose] as of December 20 13." Defense counsel continued ,
"And I believe you included in that production some e - mails . Do
you recall that?" Plaintiff: "I don ' t recall ." Tr. 614 : 25-615 :9.
Plaintiff testified that she does not recall making any attempt
to preserve emails that she sent to or received from Mr. Berger ,

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Ms . Aversa, or Mr . Weinstock prior to commencing this l awsuit .
Tr . 631-32 .

Plaintiff was questioned about a particular November
6 , 2013 email (Exh ibit L)

in which she wrote to Mr . Berger that

her then - lawyer , Rose , "might now think he will be unable to go
forward with my case ," Tr . 595:22-23 , because "we have NO Report
and NO Proof that it exist [sic] ," Tr . 596:6 - 7 . When asked
whether she threw documents like this email away , Ottoson
responded , "I don ' t recall 2013 . " Tr . 583 : 12 . When pressed ,
Plaintiff responded , "I don ' t have it currently . " Tr . 583:17 .
When asked if she had moved or changed address , she simply said
"No , " Tr . 583 : 21 , if she had suffered a f i re or flood , she
answered "I don ' t recall when , " Tr . 583 : 25 , or whether she had
turned over relevant documents to her attorneys , she answered " I
don't recall. " Tr. 584 : 4 .

Plaintiff has admitted that she emailed or otherwise
communicated with Mr . Berger about his written statements that
she produced in discovery , including , specifically , within the
context of the parties ' dispute over " bonding insurance "
discovery , Tr . 577, 588 , 650 - 51 , 662 - 63 , but testified that she
could not locate and thus did not produce such communications ,
even those created after she commenced this action. Tr . 579 - 80 ,
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589 - 90, 614 , 668 - 69 , 680 - 81 , 684. Plaintiff claimed that she was
unaware of her obligation to maintain relevant communications .
See, e . g ., Tr . 629-31; Tr. 630 : 22 - 23 (" I don ' t

recall any

obligation, to be honest with you ." ) . Plaintiff conceded that
she does not recall whether she searched for responsive
communications or whether she made any efforts , even after
commencing this action, to mainta i n relevant communications . Tr .
615 , 631-36 , 683 - 84.

In light of Plaintiff ' s deposition testimony ,
Defendants served additional discovery requests on October 16 ,
2015 . See Rice Deel ., Ex . Y (Second Set of Interrogatories); Ex .
Z (Second Document Requests) ; Ex . AA (Notice of Inspection) . As
explained in Defendants ' motion to compe l, the second discovery
requests sought:

(1)

documents and information concerning

Plaintiff ' s communicat i ons with third parties regarding the
Report , as well as documents and informat i on that could
reasonably lead to the discovery of such communications;

(2) to

undertake a forensic examination of Plaintiff ' s computers and
personal electronic devices to establish the extent of
Plaintiff's spo l iation and to determine whether any deleted
emails or files could be retrieved;

( 3) the identity of

Plaintiff ' s telephone service providers a n d the identity of any
personal computing or te l ecommunications devices that Plaintiff
15

has used since April 30 , 2012 ; and (4)

Plaintiff ' s use of

telephone services since April 30 , 2012 . ECF No . 42 , at 10 - 11 .

Plaintiff cont i nued to engage i n discovery during this
time as well . On October 22 , 20 1 5 , Defendants '

Ru l e 30(b) (6)

witness was deposed by Plaintiff . Rice Deel .

30 . Later , on

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December 4 , 2015 , Plain ti ff iss u ed a s u bpoena to New York
University . ECF No . 43 - 4 .

On December 7 , 2015 , Defendants '

counsel conferred

with Pl aintiff ' s counsel via telephone to attempt to resolve
Plaintiff ' s objections to Defendants '
Deel.

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d i scovery requests . Rice

31 . Plaintiff ' s counsel indicated that Pla i nt i ff does

not possess a computer or other persona l electron i c device , but
did not otherwise agree to provide documents or informat i on in
response to Defendants '

second discovery requests . Id . As of the

date of that call , Plaintiff had not served any wr i tten
responses , other than objections , to Defendants '

second

discovery requests . Id .

On December 1 0 , 2015 , Defendants submit t ed a l etter to
the Court with consent of Plaint i ff seek i ng an extension of time
for t h e parties to submit the j oint proposed pretr i a l order in
light of the existence of discovery disputes that would be the
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subject of Defendants '

forthcoming motion to compe l and motion

for sanctions . ECF No. 39 . The letter requested the "deadline be
extended to April 3 , 2016, or , if later , within 14 days after
the disposition of Defendants ' motions"

( i.e., the motions to

compel and for san ctions) . Id. The Court so - ordered Defendants '
request on December 11 , 2015 . ECF No . 40.

Defendants filed their motion to compel on December
23 , 2015 . ECF Nos . 41 , 42. On February 4 , 2016 , the Court held
oral argument on the motion and granted it in part , order ing
that "Plaintiff shall comply with the instant discovery
requests. " ECF Minute Entry,

Feb . 4 , 20 16.

On March 2 , 2016, Defendants received via mail
Plaintiff ' s Supp lementa l Response t o Defendants ' Notice of
Inspection , Rice Deel ., Ex . AB , and Supplemental Response to
Defendants '

Second Set o f Int errogatories , Rice Deel ., Ex . AC.

See Rice Deel .

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32 - 33 . Plaintiff responded to Defendants '

Notice of Inspection by stating : "Plaintiff does not possess any
personal computers or electronic communications devices . " Rice
Deel., Ex. AB at 3 . Plaintiff responded to Defendants '
supplemental interrogato ries by stating : "Plaintiff has not
subscribed to te l ephone service during the assigned time period
[April 30 , 20 1 2 to the present]. Plaintiff did , however, have a
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prepaid TracFone, which she lost in May 2012 . " Rice Deel. , Ex.
AC at 2 - 3. Plaintiff also stated that she "reca lls using
computers that belong to [her brother] William Ottoson " and
other computers.

Id. at 3 .

On March 21 , 2016 , Defendants received via mail
Plaintiff's Supp l emental Response to Defendants '
for Documents. Rice Deel. , Ex. AD; Rice Deel.

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Second Request
34 . Plaint if f ' s

production consisted of a single three -page Verizon bill dated
February 1, 2016, which reflected services delivered to
Plaintiff's residence address but in the name of Plaintiff's
mother, Mary Ottoson . Rice Deel., Ex. AD at 6- 8 . The bill shows
that Verizon provided telephone services to Plaintiff's address
for a tel ephone number associated with her, that at least one
international call was made in January 20 1 6 (it appears domest i c
ca lls are not listed), and that Ver iz on provided internet
services to her address . Id.

On July 6 , 2016 , Defendants '

counsel wrote to

Plainti ff' s counsel regarding def i ciencies in Plaintiff ' s
responses to Defendants' second discovery requests . Rice Deel.,
Ex. AE at 1 - 2 . In the letter , Defendants highlighted Plaintiff ' s
def i c i ent production of Verizon bills and sought such documents
f or the ent ire relevant time period . Defendants also requested
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information concerning William Ottoson ' s computer and noted that
Plaintiff has internet . Id.

Plaintiff ' s counsel responded v i a letter on July 29 ,
2016 , refusing to produce the requested d i scovery. Id . at 3 .
Defendants ' counsel reiterated his requests on August 5 , 2016 .
Id . at 4 . Plaint i ff ' s counse l responded v i a lette r dated August

18 , 2016 producing certa i n documents and stating that Plaintiff
is unab l e to provide information " concern i ng the identification
of the make , manufacturer name , model name , or serial number of
the computer that Plaintiff used that belonged to William
Ottoson .

because that computer is mi ssing ," wi thout

providing any further information as to how or when that
al l eged l y came to pass . Id . at 5. Pl ainti f f a l so produced
Verizon bills for the time period March 2016 to August 2016 ,
though the re l evant time period was Apr il 30 , 20 1 2 to the
present . Id. ; Rice Deel .

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35 .

On September 22 , 2016 , Defendants ' counsel reiterated
deficiencies in Plaintif f' s production and reserved all rights
with respect to the outstanding discovery . Id . at 6 .

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Defendants filed the instant motion on October 5 ,
2016 , which was heard and marked fully submitted on March 30 ,
2017 .

II.

The Applicable Standards

The obligation to preserve evidence app li es to a l l
relevant documents in existence and arises when a party
"reasonably anticipates litigation . " As explained by the Second
Circuit :
This obligation to preserve evidence arises when
the party has notice that the ev i dence i s
relevant to litigation - most commonly when suit
has already been filed, providing the party
responsible for the destruction with express
notice , but also on occasion in other
circumstances , as for example when a pa r ty s h ould
have known that the evidence may be relevant to
future litigation .

Kronisch v . United States , 150 F . 3d 112 , 1 26 (2d Ci r . 1998) ,

overruled on other grounds , Rotella v . Wood , 528 U. S . 549
(2000) .

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." West v . Goodyear Tire & Rubber Co ., 167 F . 3d 776,

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779 (2d Cir . 1999). Pursuant to Federal Rule of Civil Procedure
37(e) , a court may sanction a party for failing to preserve
relevant electronically stored information ("ESI") if the court
finds that the party was "act[ing] with the intent to deprive
another party o f the information's use in the litigation." Fed.
R. Ci v . P. 37(e) (2) . In addition , the court may imp ose discovery
sanctions pursuant to "its inherent power to manage its own
affairs ." Residential Funding Corp . v . DeGeorge Fin . Corp ., 30 6
F.3d 99, 106-07

(2d Cir . 2002) , superseded by rule on other

grounds as recognized by CAT3, LLC v . Black Lineage, Inc ., 164
F . Supp . 3d 488, 495 (S.D . N.Y . 2016) ; see Reilly v . NatWest
Mkts. Grp. Inc ., 181 F.3d 253, 267

(2d Cir. 1 999)

(" Whether

exerc ising its inherent power, or acting pursuant to Rule 37 , a
district court has wide discretion in sanctioning a party for
discovery abuses ." ) , superseded by statute on other grounds as
recognized by Hernandez v . Jrpac Inc. , No. 14 CIV . 4176 (PAE),
2016 WL 3248493 , at *35 (S . D.N.Y . June 9 , 2016) .

Where a party seeks a jury instruction for the
spoliation of ESI, it must establish that (1) the spoliating
party had control over the evidence and an obligation to
preserve it at the time o f destruction or loss ;

( 2) the

spoliating party acted with a cu l pable state of mind up on
destroying or losing the evidence ; and (3) the missing evidence
21

is relevant to the moving party ' s claim . See Residential
Funding , 306 F . 3d at 107 . In addition , there is the " obvious "

requirement that " the evidence must have existed ." Stephen v .
Hanley , No . 03-cv-6226 , 2009 WL 1437613 , at *2

(E . D. N. Y. May 20 ,

2009) . A party seeking spoliation sanctions has the burden of
establishing the elements of a spoliation claim by a
preponderance of the ev i dence . Sekisui Am . Corp . v . Hart , 945 F .
Supp . 2d 494 , 509 - 10 (S . D. N. Y. 2013)

(awarding sanctions for the

destruction of ESI in the form of an adverse inference jury
instruction) .

The choice of an appropriate remedy for spoliation "is
confined to the sound discretion of the trial judge and is
assessed on a case - by-case basis ." Fujitsu Ltd . v. Fed . Express
Corp ., 247 F.3d 423 , 436 (2d Cir . 2001)

(citation omitted) .

Sanctions should be designed to deter parties from engaging in
spoliat i on , place the risk of an erroneous judgment on a party
who wrongfully created the risk , and restore the prejudiced
party to the same position he would have been in absent the
wrongful destruction of evidence by the opposing party . Stinson
v . City of N . Y ., No. 10 - cv - 4228 , 2016 WL 54684

(S . D. N.Y . 2016)

(citing West , 167 F . 3d at 779) ; see also CAT3 , 164 F . Supp. 3d
at 502 . Sanctions should be tailored according to the prej u dice
suffered by the party seeking sanctions and the destroyer ' s
22

degree of culpab ility . Richard Green

Mcclendon , 262 F . R.D . 284 , 292

(Fine Paintings) v.

(S.D . N. Y. 2009)

(citations

omitted). The prejudiced party must not be held "to too strict a
standard of proof regarding the likel y contents of the destroyed
or unavailable evidence , " because doing so "wo uld allow parties
who have destroyed evidence to profit from that destruction . "

Pension Comm ., 685 F. Supp . 2d at 468
Funding , 306 F . 3d at 109)

(quoting Residential

(inte rnal quotation marks, brackets ,

and ellipses omitted ) .

III.

An Adverse Inference Based on Spoliati on is Appropriate

In the context of a motion for spoliation sanctions,
"relevance" means that " the destroyed evidence would have been
favorable to the movant." In re Methyl Tertiary Butyl Ether

Prods. Liability Litig ., 643 F. Supp . 2d 482 , 495
2009)

(S . D. N.Y .

(citation omitted) ; see also Pension Comm. of Univ . of

Montreal Pension Plan v. Banc of Am. Sec ., 685 F. Supp. 2d 456
(S.D.N.Y . 2010) , abrogated on other grounds by Chin v . Port

Auth . of N . Y . & New Jersey, 685 F.3d 135 (2d Cir . 2012)
(referring to requirement that "the evidence would have been
helpful in prov ing [the moving party ' s] claims" as requiring
"prejudice" ) . "Relevance and prejudice may be presumed when the
spoliating party acted in bad faith or in a grossly negligent
23

.
,

manner." Pension Comm ., 685 F . Supp . 2d at 467 ; see also
Sekisui , 945 F . Supp . 2d at 508

( "When evidence is destroyed

intentionally, such destruction is sufficient evidence from
which to conclude that the missing evidence was unfavorable to
that party. " )

(citation omitted) ; Arista Records LLC v .

Usenet . com , 608 F . Supp . 2d 409, 439 (S . D.N.Y . 2009)

( " When

evidence is destroyed in bad faith , that alone is sufficient to
support an inference that the missing evidence would have been
favorable to the party seeking sanctions , and thus relevant ." )
(citations omitted).

Here , the evidence establishes relevance and prejudice
because the Plaintiff "acte d in bad faith or in a grossly
negligent manner ." Pension Comm ., 685 F . Supp . 2d at 467 . The
Plaintiff had control over the evidence and an ob ligat ion to
preserve it from July 9 , 2012 , the date that her counsel sent a
demand lett er to Defendants threatening litigation and
requesting Plaintiff ' s personnel file , see Rice Deel ., Ex . X,
or , at the latest , from August 3 1, 2012 , when Plaintiff filed a
Charge of Discrimination with the EEOC. See Compl .

~

4 ; Zubulake

v. UBS Warburg LLC , 220 F.R.D. 212 , 216 (S.D . N. Y. 2003)

("[T]he

duty to preserve evidence arose , at the latest , on August 16,
2001 , when Zubu lak e filed h er EEOC charge ." ) .

24

Following Plaintiff ' s cha rg e filing , she obtained
statements from Ms . Aversa , see Rice Deel. , Ex . E (dated
November 24 , 2012) , Mr . Berger , see Ex . D (signed on January 9 ,
2013) , and Mr . Weinstock , see Ex. F (dated January 3 1, 2013) ,
which were produced in discovery . On March 31 , 2014 , Plaintiff
produced , via emai l from her then-counse l Mr . Rose , " addenda "
from Mr . Berger and Ms. Aversa . Rice Deel ., Exhibit H-J. She had
a duty to preserve communications with these affiants ; however ,
Plaintiff has produced no documents or emails concerning her
communications with them . Rice Deel .

~

6 (" Plaintiff did not

produce any communicat i ons with Mr. Berger , Mr . Weinstock , or
Ms . Aversa , or any drafts o f their statements , nor did Plaint i ff
provide any explanation or information about doc uments that were
no longer in her possession or contro l." ) . With r espect to
emails between Mr . Berger and Pl aint i ff , the ear li est email
vo luntarily provided to Defendants ' counsel by Mr . Berger is
dated January 6 , 2013 , about six months after Plaintiff ' s
preservation duty first arose. See Rice Deel ., Ex . X.

The Plaintiff continued to send highly relevant and
undeniably respons i ve emails to Mr . Berger throughout this
litigati on and during discovery disputes , yet failed to disclose
them t o Defendants . The emails indicate efforts by Plaintiff t o
direct the exact contents of Mr . Berger ' s witness statement . See
25

Rice Deel., Ex. P (Ema il chain between Ottoson and Berger dated
March 9- 10 , 2014) ; Ex. Q (Ottoson - Berger email dated March 14 ,
2014)

(directing Berger to "JUST COPY & PASTE & PLEASE TYPE THE

WORK ' ADDENDUM ' ON TOP AS FOLLOWS" and explaining that she is
" sorry tha t

I have to ask you but this is needed i mmediately

otherwise during the Discovery Dispute next week , the Judge may
can [sic] yo u int o the court & I am trying t o avo i d that for
you . I will send you anything you have to pay for to get this
notarized ." ) ; Ex . R (Email from Ottoson to Berger dated March
1 8 , 2014) . By March 2014 , when these emails were exchanged ,
Plaintiff had already produced documents , in clud in g the three
affidavits , and the parties '

counsel were discussing whether

"April 10 is an available date for Ottoson ' s depos iti o n." Rice
Deel ., Ex. Hat 5 (Rice Email to Rose dated March 14, 2014) .

The emails also indicate that that Pla in tiff operated
under the powerful motivator that , without proof of the
existence of the Report , Plaintiff ' s case had no basis to
continue . Plaintiff ' s November 10 , 2013 email to Mr . Berger
shows that she understood the central relevance of the Report to
her case : " After our mediation meeting,

I feel that

[Mr. Rose ]

has given up because of the opposition . He is young and
inexperienced . He also tried desperately to get me into dropping
everything for nothing because as we all know : We don ' t have the
26

report . No Report - No Case ." Rice Deel ., Ex. M. The missing
evidence -

communications in which Plaintiff discussed the

existence of the Report with the only witnesses purported to
have knowledge of it -

is indisputably relevant to her case . As

Plaintiff's deposition testimony and available writings make
c l ear , she knew what would happen to her case if there was no
evidence of the Report ' s ex i stence .

Defendants have provided this court with sufficient
evidence , both direct and circumstantial , that :

(1)

Plaintiff

communicated with Mr . Berger via email (see Rice Deel. , Exs . KS) ;

(2)

Plaintiff failed to take any reasonable steps to

preserve these commun ications
and/or (3)

(see Rice Deel., Ex. Cat 631 - 32) ;

Plaintiff failed to produce these communications in

violation of her discovery obligations . The logical inferences
that can be drawn from these facts are that Plaintiff :
intentionall y deleted the emails ;

(a)

(b) did n ot intentionally take

any steps to preserve those emails ; or (c)

still has those

emails in her possession but has failed to produce them . Any of
these scenarios satisfies the requisite level of intent required
by Federal Ru l e of Civi l Procedure 37(e). See , e . g ., Arrowhead

Capital Fin ., Ltd . v . Seven Arts Entm ' t , Inc ., No. 14 - cv - 6512 ,
20 16 WL 4991623 , at *20

(S . D.N . Y. Sept . 16 , 2016)

(ordering

sanctions in part because defendants failed " to make prompt
27

,

r

(

.
that has occurred " because "[d]efendants failed to take
reasonable steps to preserve the ESI related to this case, "
"additional efforts to ensure the preservation of these
materials once the spoliation letter was received" should have
been made , and " [s]uch irresponsible and shiftless behavior can
only lead to one conclusion-that [defendants] acted with the
intent to deprive Plaintiff of the use of this information at
trial") ; Brown Jordan Int ' l, Inc . v. Carmicle , No . 14 - cv - 60629 ,
2016 WL 815827 , at *37

(S . D. Fla . Mar. 2, 2016)

(imposing

adverse inference sanctions against defendant for spoliation of
evidence because the court found that defendant failed to take
reasonable steps to preserve electronically stored information
on his personal and company- owned devices) ; Internmatch, Inc . v .
Nxtbigthing, LLC, No . 14 - cv - 5438 , 20 1 6 W 491483, at *4-5 , *12L

14 (N . D. Cal . Feb . 8 , 2016)

(granting plaintiff a preclusion

order , an adverse inference instruction , and attorneys '

fees as

sanctions because defendants willfully spoliated evidence by
intentionally discarding devices that contained the electronic
versions of the evidence despite having a duty to preserve
relevant evidence).

During her depositions , Plaintiff admitted that she
emailed with Mr. Berger and communicated with him concerning the
written statement that he submitted at Plaintiff ' s request about
29

the Report. Tr. at 57 7 , 5 8 8 , 6 50-51, 66 2 - 63 . Moreover , the
emails tha t Mr . Berger pr ovided to Defendants show e x tensive
communicati o n by email between Plaintiff and Mr . Berg er.

1

Rice

Deel ., Exs. K- S. Mr. Berger , a third party witness , who has no
identified interest in fabricating o r fraudulently producing
emails, pr ov ided these communications to Defendants. The content
o f the communi c ati o ns reveal that, at worst , Plaintiff has
fabricated the existence of the "Report" on which her entire
case rests, and at best , she has pressured witnesses to make
certain assertions on her behalf . 2

Plaintiff has admitted that she deleted emails during
times wh e n she had a duty to preser v e them , and that she c o uld
not recall making any attempt t o preserv e emails that sh e s e nt
t o or recei v ed from Mr. Be rger or the other individuals from
wh om she obtained written statements for this litigation. Even
crediting Plaintiff ' s later contradictory testimony - that at
some undefined point in time she ceased her practice of

Pl aintiff ' s argument is that De f endants have not " authenticated" t h ese
emai l s , which they received f rom Mr . Berger , but at no time does Plaintiff
contend that Defendants have fabricated the emai l s .
2

Plaintiff has acknowledged , in emai l s to Mr . Berger , that i f there is
" no Report ," then she has " no case ." Rice Deel. , Ex . M. Defendant s have
stated , including under penalty of perjury , that t hey have never possessed ,
read , o r see n any evidence of the existence o f t his suppo s ed " Report ," and
deny all allegati o ns relating to any discriminatory motive whatsoever for
the i r t ermination of Plaintiff . See De fs . Br . at 2 - 3 ; Rice Deel ., Exs . V & W;
ECF No . 33 .

30

routinely deleting emails - the existence of the emails that Mr .
Berger provided establishes that Plaintiff destroyed them , and
must have done so after her obligation to preserve the
communications began .

Plaintiff has cited Khadei v. Kaspiev,

961 F . Supp. 2d

564 , 569 (S . D.N . Y. 2013) for the proposition that "the
spoliation doctrine is predicated on evidence actually existing
and being destroyed." Opp . Br . at 5. While that proposition is
correct , the case is inapposite . In Khadei , the court held that
the act of "moving photographs to a new location " did not
constitute destruction of evidence . Id . at 570. Instead , the
court explained that there was absolutely no evidence that any
actual evidence (i . e. , again , the photographs) were destroyed or
significantly altered . Id. Plaintiff was able to , and actually
did , perform a full inspection of the photographs and of their
location no matter where the photographs were located . Id . In
Khadei , the non - spoliating party was able to inspect the

photographs because they still existed , albeit in another
location . Here, Defendants are unable to inspect all of
Plaintiff ' s email communications with all of her witnesses
because Plaintiff "failed to take reasonable steps to preserve"
them , in violation of Rule 37(e) , and this critical evidence
cannot be "restored or replaced ."
31

Plaintiff also cites to Farella v . City of N . Y. , No .
05 - cv - 5711 , 2007 WL 193867 , at *1-2

(S . D. N. Y. 2007) , where

Plaintiffs (City firefighters and police officers) alleged that
they suffered harm from l ead exposure at a firing range.
Plaintiffs claimed that the City destroyed and failed to
preserve substantial lead exposure data . Id . at *2. Plaintiffs '
mot i on for spoliation sanctions failed because they had no
"evidence showing that the ' missing ' evidence ever existed . " Id .
Here , Defendants are in possession of Plaintiff ' s emails with
Mr . Berger because Mr . Berger provided the emails to Defendants ,
and therefore , these and other relevant communications existed .
Plaintiff has never denied sending or receiving the emails with
Mr . Berger . She admitted during her deposition that it was
indeed " possible " that she had sent and/or received these
emails . Tr . at 581 : 16 , 588 : 6 , 589 : 4 . Where , as here , Defendants
have demonstrated the existence of the emails in question by
producing such emails , Plaintiff cannot contradict such a
demonstration by claiming she does not "recall" sending or
receiving such emails . Plaintiff ' s contradi ctory testimony and
lack of recollection does not serve to rebut Defendants '
proffered evidence that the emails do indeed exist , were in fact
sent to and received by Plaintiff , and were not preserved and/or
produced by Plaintiff.

32

An adverse inference in st ru ct i o n is wa r ranted here
because Defendants have provided suffic i ent evidence that
addit i onal communications between Plaintiff and her witnesses
li kely existed , we r e not produced , and were relevant . See DMAC
LLC v . City of Peekskill , No . 09 - cv - 5093 , 2012 W 4459290 , at *4
L

(S . D. N. Y. 2012)

(granting defendant ' s mo t ion for sanctions based

u pon spo l iation o f evidence because i t

fo und that the mov in g

party " proffered sufficient evidence from which a reasonable
f a ctfinder could i nfer that additional re l evant e - ma il s f a vorab l e to pla i nt i ffs - existed but were not p r oduced" and
awarding an adv erse inference instru ction stating that the
destroyed " e - mails would have been favorable to [ the non spoliating party ' s] case " ) . When , as here , a spol i ating party
has acted willfully or in bad faith , a j u ry can be instructed
t h at " certain facts are deemed admi t ted and must be accepted as
t r ue ." Pension Comm ., 685 F . Supp. 2d at 470 (c i tat i ons
omitted) ; see also Sawabeh Info . Servs . Co. v . Brody, No . 11-cvL
4 1 64 , 2014 W 46479 , at *3 (S . D.N . Y. 2014) , aff ' d & rev ' d in
part on other grounds , 598 F . App ' x 794

(2d Cir . 2015)

(descr i bing previous order granting motion for an adverse
inference because plaintiffs h ad been " at least grossly
negligent in the preservation and production of [ESI] . ")

Such

an instruction c an be " critical to assisting the innocent party
i n establishing the natu r e of the ev i dence that has gone
33

missing ." Id. An adverse inference instruction "i s imposed to
ameliorate an y prejudice to the innocent party by filling the
evidentiary gap created by the party that destroyed evidence ."
OrbitOne Commc ' ns, In c . v . Numere x Corp ., 271 F . R. D. 429 ,

n.12

IV.

438

(S.D.N . Y. 2010).

Defendants' Application for Fees and Costs is Adjourned

Under Federal Rule of Civil Procedure 3 7 (a) ( 5) (A) ,
when a discovery motion is granted pursuant to Rule 37 , the
. whose conduct necessitated

Court must " require the party .

the motion , the party or attorney advising that conduct , or both
to pay the movant ' s reasonable expenses incurred in making the
motion , including attorneys '

fees ." Fed. R . Civ . P . 37 (a) (5) (A).

Even outside the context of a Rule 37(e) dispute , the Court has
the inherent authority to award attorneys '

fees and costs to

"punish the offending party f or its actions and deter the
litigant ' s conduct , sending the message that egregious conduct
will not be tolerated ." Best Payphones, Inc . v. City o f N . Y .,
No . 01 - cv - 8506 , 2016 WL 792396 (E . D. N.Y . 2016)

(i nternal

citations omitted). Here , Plaintiff was faced at deposition with
emails sent to her own email inbox and from her own email outbox
to a person that she alleges is a materia l witness to the
central fact in dispute i n this litigation , i.e. , whether this
34

"Report " has ever existed . However , the assessment of costs and
fees and any other similar applications will be adjourned to the
final determination of this action .

V.

Conclusion

For the reasons set forth above , the Defendants '
motion for sanctions against Plaintiff is granted , an adverse
inference instruction will be given , and the application for
fees and costs is adjourned .

It is so ordered .

New York, NY
July 1
201 7

J,

U . S.D.J.

35