UNITED STATES OF AMERICA v. CURRENCY, $43,660.00 IN U.S. et al
Filing
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MEMORANDUM OPINION AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE signed by MAG/JUDGE L. PATRICK AULD on 02/09/2016 as set out herein. RECOMMENDED that Plaintiff's Motion to Strike (Docket Entry 18 ) be granted and that Claimant's Verified Claim (Docket Entry 6 ) and Verified Answer (Docket Entry 7 ) be stricken.(Taylor, Abby)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
UNITED STATES OF AMERICA,
Plaintiff,
v.
$43,660.00 in U.S. CURRENCY and
$4,000.00 in U.S. CURRENCY,
Defendants.
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1:15CV208
MEMORANDUM OPINION AND RECOMMENDATION OF
UNITED STATES MAGISTRATE JUDGE
This
matter
comes
before
the
undersigned
United
States
Magistrate Judge on Plaintiff’s Motion to Strike (Docket Entry 18)
the claim of Vaughn Johnson (the “Claimant”) pursuant to Rule
37(b)(2) of the Federal Rules of Civil Procedure (the “Rules”).
Plaintiff
previously
filed
a
“Motion
to
Compel
Response
to
Discovery” (the “Motion to Compel”) requesting that the Court
require Claimant to respond completely and fully to Plaintiff’s
First Request for Production of Documents (“Plaintiff’s Document
Requests”).
(Docket Entry 14.)
The Court granted Plaintiff’s
Motion to Compel, ordering “Claimant to respond to Plaintiff’s
[D]ocument [R]equests” and warning that “[f]ailure by Claimant to
comply with
sanctions
[the]
under
Order
[Rule]
w[ould]
37(b)(2),
result
in the
including
the
imposition of
striking
of
[Claimant’s] Verified Claim [(Docket Entry 6)] and [Claimant’s]
Verified Answer [(Docket Entry 7)] and/or the entry of a default
judgment against Claimant.”
(Text Order dated Nov. 17, 2015.)
Plaintiff’s Motion to Strike alleges that Claimant has failed to
comply with the Court’s Order to respond to Plaintiff’s Document
Requests and asks the Court to strike Claimant’s claim.
Entry 19 at 2.)
(Docket
Claimant has not responded to the Motion to
Strike. (See Docket Entries dated Dec. 16, 2015, to present.) The
undersigned Magistrate Judge now enters this Recommendation that
the Court grant Plaintiff’s Motion to Strike (Docket Entry 18) and
strike Claimant’s claim for failing to comply with a discovery
order.
“[D]iscovery is a cornerstone of the litigation process.”
Jones v. Goord, No. 95 CIV. 8026, 2002 WL 1007614, at *1 (S.D.N.Y.
May
16,
2002)
(unpublished).
It
provides
parties
critical
information necessary both to pursue or defend their claims at
trial and to reduce the possibility of surprise.
See Hickman v.
Taylor, 329 U.S. 495, 507 (1947). Therefore, “[a] party who flouts
[discovery] orders does so at his own peril[,] as compliance with
discovery orders is necessary to the integrity of the judicial
process.”
Sentry Ins. A Mut. Co. v. Brand Mgmt., Inc., 295 F.R.D.
1, 14 (E.D.N.Y. 2013) (alterations in original; internal quotation
marks omitted), recommendation adopted, id. at 2-8.
To ensure
compliance with discovery orders, Rule 37(b)(2)(A) provides that,
“[i]f a party . . . fails to obey an order to provide or permit
discovery, . . . the court where the action is pending may issue
2
further just orders.”1
Such orders include “striking pleadings in
whole or in part,” and “dismissing the action or proceeding in
whole or in part.”
Fed. R. Civ. P. 37(b)(2)(A)(iii) & (v).
In
evaluating the propriety of a dispositive sanction, the Court must
consider:
“(1) whether the noncomplying party acted in bad faith;
(2) the amount of prejudice his noncompliance caused his adversary,
which necessarily includes an inquiry into the materiality of the
evidence he failed to produce; (3) the need for deterrence of the
particular sort of noncompliance; and (4) the effectiveness of less
drastic sanctions.”
Mutual Fed. Sav. and Loan Ass’n v. Richards &
Assocs., Inc., 872 F.2d 88, 92 (4th Cir. 1989).
In this case, the factors favor striking Claimant’s claim.
First, Claimant has failed to comply with this Court’s order
compelling him to respond to Plaintiff’s Document Requests.
In
fact, Claimant has not made any filings in nearly a year (see
Docket Entries dated Apr. 24, 2015, to present), during which time
he
failed
to
respond
to
Plaintiff’s
first
Motion
to
Extend
Discovery Period (Docket Entry 12), Motion to Compel (Docket Entry
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“Rule 37(b)(2) limits the availability of sanctions to
‘parties’ and their agents; this is no bar to the dismissal of
[Claimant’s] claim, as courts have long held that in rem claimants
are parties to the action.” United States v. $44,700.00 in U.S.
Currency, Civ. Action No. 7:08-3462, 2010 WL 360510, at *2 n.1
(D.S.C. Jan. 26, 2010) (internal quotation marks omitted); see also
United States v. $8,369.00 in U.S. Currency, 1:08CV145, 2009 WL
88060, at *1 (M.D.N.C. Jan. 12, 2009) (recommending dismissal of
claim to the defendant property under Rule 37(b)), recommendation
adopted, slip op. (M.D.N.C. Mar. 17, 2009).
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14), second Motion to Extend Discovery Period (Docket Entry 16),
and
Motion
to
Strike
(Docket
Entry
18).
Plaintiff
filed
a
Certificate of Service with each of these motions, verifying
service upon Claimant at the address he provided in his Verified
Claim (Docket Entry 6, ¶ 2 (providing “the address at which the
[C]laimant will accept future mailings”).
copies of its orders to this address.
The Court also sent
(See Docket Entries dated
June 24, 2015, July 21, 2015, and Nov. 18, 2015.)
Nothing in the
record indicates that Claimant has not received Plaintiff’s filings
or the Court’s orders, so the undersigned must conclude Claimant
has willfully failed to participate in this litigation.
See Green
v. John Chatillon & Sons, 188 F.R.D. 422, 424 (M.D.N.C. 1998)
(“Noncompliance with discovery orders can serve as a basis for a
finding of bad faith.”).
Second, Claimant has caused Plaintiff significant prejudice.
To defend against Claimant’s claim to the defendant property,
Plaintiff’s Document Requests “sought documents and other tangible
items relating to (1) details concerning the acquisition of the
defendant property, and (2) details concerning the net worth and
sources of income of the Claimant.”
(Docket Entry 19 at 4; see
also Docket Entry 15 at 23-28 (Plaintiff’s Document Requests).)
Plaintiff credibly contends that “[t]his information is necessary
to establish ownership of the defendant property and affirmatively
show that the defendant property was used to facilitate illegal
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drug activity or represent illegal drug proceeds, and to defend
against claims of a legitimate source for the defendant property.”
(Docket Entry 19 at 4.)
By failing to respond to Plaintiff’s
Document Requests, Claimant has therefore withheld information
necessary for Plaintiff to proceed in this litigation.
Plaintiff
cannot prepare for trial without fair notice of Claimant’s version
of events and supporting evidence.
Third, Claimant’s stalwart refusal to participate in this
litigation or respond to Plaintiff’s Document Requests embodies a
particularly troublesome form of noncompliance with a discovery
order.
By
refusing
to
participate
or
respond,
Claimant
intentionally delays the swift administration of justice, and the
Court must deter such activity.
See United States v. $8,369.00 in
U.S. Currency, 1:08CV145, 2009 WL 88060, at *1 (M.D.N.C. Jan. 12,
2009) (recommending dismissal of claim under Rule 37(b), and noting
that “[t]here is obviously a need for deterrence when a claimant
files a claim and then does nothing to pursue it”), recommendation
adopted, slip op. (M.D.N.C. Mar. 17, 2009); United States v. Three
Tracts of Real Prop. in E. Bend Twp., Yadkin Cty., N.C., 1:04CV987,
2007 WL 433381, at *1 (M.D.N.C. Feb. 5, 2007) (“Outright noncompliance with a court order cannot be countenanced, and such
flagrant
violation
of
the
[R]ules
recommendation adopted, id.
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must
be
deterred.”),
Fourth, despite the Court’s previous Order requiring Claimant
to respond to Plaintiff’s Document Requests and warning Claimant
that failure to comply may result in the striking of his claim
(Text Order dated Nov. 17, 2015); see Hathcock v. Navistar Int’l
Transp. Corp., 53 F.3d 36, 40-41 (4th Cir. 1995) (“emphasiz[ing]
the significance of warning a defendant about the possibility of
default [under Rule 37] before entering such a harsh sanction”),
Claimant has not produced the requested documents.
Accordingly,
“[t]here are no less drastic sanctions because these matters are
totally within the Claimant’s control, are simple, and by failing
to obey [a] court order[]” or participate in this litigation in any
meaningful way for nearly a year, “Claimant has indicated an
abdication of an intent to pursue this matter.”
$8,369.00 in U.S.
Currency, 2009 WL 88060, at *1 (citing Pontoon v. National R.R.
Passenger Corp., 194 F.R.D. 521 (M.D.N.C. 1999)); see also United
States v. $35,057.00 in U.S. Currency, Civ. Action No. 12-2675,
2015 WL 1284635, at * 2 (D. Md. Mar. 20, 2015) (granting the
government’s motion to strike the claimant’s claim under Rule 37(b)
because
the
claimant
would
not
make
himself
available
for
deposition); Green, 188 F.R.D. at 425 (dismissing the plaintiff’s
case with prejudice under Rule 37(b) for “fail[ing] to provide
responses to [the defendant’s] discovery requests despite giving
multiple assurances to [the defendant’s] counsel that responses
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were
forthcoming
and
a
court
order
requiring
responses
and
threatening dismissal for noncompliance”).
In sum, all four factors support striking Claimant’s claim.
IT IS RECOMMENDED that Plaintiff’s Motion to Strike (Docket
Entry 18) be granted and that Claimant’s Verified Claim (Docket
Entry 6) and Verified Answer (Docket Entry 7) be stricken.
/s/ L. Patrick Auld
L. Patrick Auld
United States Magistrate Judge
February
9 , 2016
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