U.S. Equal Employment Opportunity Commission v. Ventura Corporation Limited

Filing 71

OPINION AND ORDER granting in part and denying in part 42 Motion for Sanctions. Signed by Judge Juan M Perez-Gimenez on 2/12/2013. (PMA)

UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF PUERTO RICO
EQUAL EMPLOYMENT OPPORTUNITY
COMMISSION,
Plaintiff,
CIV. NO. 11-1700 (PG)
ERICK D. ZAYAS,
Plaintiff-Intervenor,
v.
VENTURA CORPORATION LIMITED,
Defendant.

OPINION AND ORDER
A. BACKGROUND
The Equal Employment Opportunity Commission (“EEOC” or “Plaintiff”) filed
the above-captioned claim on July 19, 2011 under Title VII of the Civil Rights
Act of 1964, as amended, 42 U.S.C. § 2000e et seq. (“Title VII”), and Title
I of the Civil Rights Act of 1991, 42 U.S.C. §1981a. According to Plaintiff,
the claim was filed against Ventura Corporation Limited

(“Ventura” or

“Defendant”) with the purpose of correcting unlawful employment practices on
the basis of sex (male) and protected activity, and providing appropriate
relief to Erick Zayas and a class of internal and external male applicants who
were adversely affected by such practices. See Docket No. 1. Shortly after the
EEOC filed the complaint, Erick Zayas (“Zayas” or “Intervenor Plaintiff”)
filed a motion to intervene (Docket No. 7), which the Court granted. See
Docket No. 10.
Pending before the court is the EEOC’s motion for sanctions (Docket
No. 42) wherein the EEOC claims that Ventura, knowing of the potential for
litigation, destroyed key, relevant evidence after having been repeatedly
advised of its legal obligation to preserve evidence that was relevant to the
present charges of discrimination. See Docket No. 42. According to the EEOC,
Ventura

destroyed

employment

application

materials

it

received

between

2004-2009 for Zone Manager and Support Manager positions and selectively
destroyed email accounts of key managers involved in the decision to terminate
Zayas’ employment. The EEOC argues that these actions rendered unavailable

CIV. NO. 11-1700(PG)

material

evidence

Page 2

directly

relevant

to

proving

Zayas’

allegations

and

disproving Ventura’s defenses. See id.
A summary of the facts of this case is as follows. On July 30, 2007,
Zayas filed a charge of sex discrimination against Ventura claiming that the
latter failed to hire him for a sales position because of his gender. See
Docket No. 42-1. After Zayas’ charge, however, Ventura placed him in a Zone
Manager position in September of 2007. Notwithstanding, on July 22, 2008,
Zayas filed a second charge of discrimination against the Defendant claiming
that Ventura was retaliating against him for having complained of sex
discrimination. See Docket No. 42-5. After each one of these charges, the EEOC
sent Ventura a notice wherein the Defendant was apprised of its duties to
preserve evidence pursuant to 29 C.F.R. § 1602.14. Then, on October 15, 2008,
Zayas sent an email complaining of discrimination and retaliation to several
managers at Ventura, namely, María Mojica (“Mojica”), Administration and Human
Resources Director; Jésika Ruiz (“Ruiz”), Regional Manager; Blanca Barragan,
Sales Director; and German Ramirez, General Director. See Docket No. 42-6.
Zayas was terminated only five days thereafter, and he amended his EEOC charge
accordingly. See Dockets No. 42-3, 42-10. As a result, the EEOC alleges it
sent Ventura a third preservation notice.
In response to Zayas’ complaint of retaliation and sex discrimination
before the EEOC, Ventura stated that “the fact that no males have filed
applications and/or may have not met the position requirements established for
such a high-level managerial position, … , does not support any allegation of
employment discrimination on the basis of sex or gender.” See Docket No. 42-12
at page 2. Moreover, in its answer to the complaint, Ventura alleges that
“[i]f no males were hired during any particular period of time, was because
the employment candidates did not meet the job position requirements, none of
which relates to the persons’ gender or sex.” See Docket No. 9 at ¶ 82.
However, contrary to these assertions, the EEOC found that males did in
fact apply to the sales/managerial positions in question after reviewing a
list of applicants Ventura produced during the limited discovery that took
place in the administrative proceedings. See Docket No. 42-14. In addition,
the report prepared by the EEOC’s labor economist concludes that application
materials that were not discarded demonstrate that qualified men did apply to
the Zone Manager and Support Manager positions. See Docket No. 42 at page 7,
42-20. In fact, contrary to Ventura’s defense, men accounted for 34.5 percent

CIV. NO. 11-1700(PG)

Page 3

of all qualified applicants according to this report. See Docket No. 42-20 at
page 5.
It also stems from the record now before the court that, when asked about
the résumés Ventura received, Sandra Espada (“Espada”), Human Resources
Analyst for Ventura, testified during her deposition that certain documents
from the Human Resources Department were either taken to a warehouse or
shredded as a result of an office restructuring in 2009. See Docket No. 42-8
at pages 32-33. Espada later submitted an unsworn statement under penalty of
perjury stating that she did not find any application materials in the boxes
that were sent to a warehouse. See Docket No. 42-15. Moreover, Ventura admits
in its response that employment applications received via electronic mail at
[e-mail] prior to 2010 were lost during a software program
migration. See Docket No. 49 at page 19. The EEOC now argues that the
Defendant should have kept the application materials showing the gender and
qualifications of candidates who applied for the positions of Zone Manager and
Support Manager because they were relevant to the EEOC’s case and to the
defenses Ventura has raised in the process. The EEOC posits that according to
the applicable statute and regulations - of which Ventura had notice since
2007 - they should have been preserved. See Docket No. 42. In its defense,
Ventura also claims that it “neither maliciously destroyed evidence nor
deliberately attempted to prevent the EEOC from inspecting any document or
information.” Docket No. 49 at page 23.
The EEOC also complains that Ventura destroyed the e-mail accounts of
employees directly involved in Zayas’ case, namely, Ruiz and Mojica, while
allegedly making large-scale changes to its computer systems. See Docket
No. 42 at page 6. The EEOC is aware that Ruiz and Mojica discussed Zayas’
termination over e-mail because Zayas himself produced an e-mail - that was
not produced by Ventura - evincing these discussions. This particular e-mail
dates back to March of 2008, just six (6) months after Zayas was assigned Zone
Manager. See Docket No. 42-4. The EEOC thus sustains that, despite having been
apprised of its legal duty to preserve evidence, the Defendant “did not take
any care whatsoever to save documents or electronic information relevant to
Mr. Zayas’ charges of discrimination and retaliation.” See Docket No. 42 at
page 6.

CIV. NO. 11-1700(PG)

Page 4

Ventura timely responded to the EEOC’s contention that it engaged in
spoilation of evidence and opposed its request for sanctions. See Docket
No. 49. The arguments set forth therein shall be discussed forthwith.
B. DISCUSSION
“Spoliation can be defined as the failure to preserve evidence that is
relevant to pending or potential litigation. Through the court’s inherent
power to manage its own affairs, it may sanction a party for spoliation.”
Jimenez-Sanchez v. Caribbean Restaurants, LLC, 483 F.Supp.2d 140, 143 (D.P.R.
2007). “Litigants have the responsibility of ensuring that relevant evidence
is protected from loss or destruction. “A litigant has a duty to preserve
relevant evidence.”” Velez v. Marriott PR Management, Inc., 590 F.Supp.2d 235,
258 (D.P.R. 2008) (citing Perez-Velasco v. Suzuki Motor Co. Ltd., 266
F.Supp.2d 266, 268 (D.P.R.2003)).
[T]his obligation predates the filing of the complaint
and arises once litigation is reasonably anticipated.
… The duty to preserve material evidence arises not
only during litigation but also extends to that period
before the litigation when a party reasonably should
know that the evidence may be relevant to anticipated
litigation … If a party cannot fulfill this duty to
preserve because he does not own or control the
evidence, he still has an obligation to give the
opposing party notice of … the possible destruction of
the evidence if the party anticipates litigation
involving that evidence.
Velez, 590 F.Supp.2d at 258 (citing Perez-Velasco, 271 F.3d at 591) (internal
citations and quotation marks omitted).
Throughout its response, the Defendant opposed the EEOC’s request that
it be charged with spoliation by arguing that the EEOC never requested that
Ventura

specifically

preserve

or

produce

résumés

sent

by

unsuccessful

applicants or employment candidates. See Docket No. 49. The notice the EEOC
sent Ventura when Zayas filed its administrative charges of discrimination and
retaliation makes reference to Section 1602.14 of title 29 of the Code of
Federal Regulations, which states, in relevant part, that:
Any personnel or employment record made or kept by an
employer (including but not necessarily limited to
requests for reasonable accommodation, application
forms submitted by applicants and other records having
to do with hiring, promotion, demotion, transfer,
lay-off or termination, … ) shall be preserved by the
employer for a period of one year from the date of the
making of the record or the personnel action involved,

CIV. NO. 11-1700(PG)

Page 5

whichever occurs later. … Where a charge of
discrimination has been filed, or an action brought by
the Commission … , against an employer under title VII,
… , the respondent employer shall preserve all
personnel records relevant to the charge or action
until final disposition of the charge or the action.
The term “personnel records relevant to the charge,”
for example, would include personnel or employment
records relating to the aggrieved person and to all
other employees holding positions similar to that held
or sought by the aggrieved person and application forms
or test papers completed by an unsuccessful applicant
and by all other candidates for the same position as
that for which the aggrieved person applied and was
rejected. …
29 C.F.R. § 1602.14. In light of the language of this regulation, Ventura
sustains that it was not under the obligation to preserve applicants’ résumés
because the statute only refers to “application forms” and “test papers” and
Defendant did not require job applicants to fill out or submit to either. See
Docket No. 49 at page 8. However, the Court disagrees. The regulation in
question also states that the records an employer must preserve include, but
are not limited to, “other records having to do with hiring … .” 29 C.F.R. §
1602.14. Contrary to Ventura’s position, the Court finds that this language
put Ventura on notice that it should have preserved the relevant application
documents it admittedly had in its possession, to wit, applicants’ résumés.
In its opposition, Ventura also argued that the EEOC does not meet its
threshold burden to show that there is relevant evidence that has been
spoiled. See Docket No. 49 at page 17. Pursuant to the applicable caselaw,
before an inference of spoliation may be drawn, “the party urging that
spoliation has occurred must show that there is evidence that has been spoiled
(i.e., destroyed or not preserved).” Gomez v. Stop & Shop Supermarket Co., 670
F.3d 395, 399 (1st Cir.2012) (citing Tri–County Motors, Inc. v. Am. Suzuki
Motor Corp., 494 F.Supp.2d 161, 177 (E.D.N.Y.2007)). In its motion, the EEOC
evinced that Ventura produced a list of applicants for limited time-periods
between 2004 and 2007. See Docket No. 42-14. However, during the discovery
proceedings of this case, the EEOC learned that employment application
materials between 2007 and 2010 were unavailable for production. These
application materials included hard copies that Ventura either shredded or
warehoused, or soft copies that it lost or deleted from its electronic mail
account [e-mail] during a software program migration. It is
not known at what particular point in time these documents disappeared. All
we have before us is the testimony of Espada from the Human Resources

CIV. NO. 11-1700(PG)

Page 6

Department in charge of receiving and filing these documents, who indicated
that she was unable to find them. As previously stated, Ventura should have
preserved these materials since it received its notice of Zayas’ charge before
the EEOC in 2007. Therefore, the EEOC has successfully established that
relevant evidence that was admittedly in the hands of the Defendant between
2007 and 2010 was not produced during discovery because it was either lost,
deleted or destroyed. In fact, the EEOC even attached to its motion an e-mail
communication between Mojica and Ruiz, which was produced by Zayas and thus
survived Ventura’s destruction. See Docket No. 42-4. Not only can the Court
sanction Ventura for failing to produce this particular e-mail, but, as the
EEOC states, it can also be inferred that other similar e-mails regarding the
status of Zayas’ employment were likely to have existed but were destroyed,
see Docket No. 42 at page 8. The EEOC, thus, has met its obligation to prove
that relevant evidence in the hands of Ventura existed and was destroyed after
it was on notice that litigation might ensue.
Ventura also claims that “[t]he gender and qualifications of applicants
for Zone and Support Manager positions were neither relevant nor related to
any of the specific charges of discrimination filed by Zayas.” Docket No. 49
at page 12. However, this contention is belied by its own response to Zayas’
administrative claim and the answer to the complaint wherein Ventura makes
reference to the lack of qualifications of male applicants as a defense for
not having hired one for the positions in question. Moreover, “[r]elevant
evidence is that which may prove or disprove a party’s liability theory.”
Velez, 590 F.Supp.2d at 258. Because Ventura itself has stated that it did not
request that job applicants fill out a specific application form or submit to
testing, the only pertinent evidence in its possession that could actually
prove its defense that no qualified men applied to the positions of Zone and
Support Manager were in fact the applicants’ résumés, particularly those of
unsuccessful male applicants.
Ventura further sustains that the EEOC has not demonstrated that its
ability to litigate this case has been substantially impaired by the alleged
spoliation. See Docket No. 49 at page 37. However, the Court finds that the
allegedly spoliated evidence was relevant to the EEOC’s and Zayas’ theory of
the case. In his first charge before the EEOC, Zayas alleged that Ventura
officials repeatedly told him that sales positions were for women. See Docket
No. 42-1. Therefore, the résumés or job application materials that were
destroyed were also relevant to prove that, despite the fact that qualified

CIV. NO. 11-1700(PG)

Page 7

men applied to the positions in question, the Defendant has only historically
hired women. Hence, the Court finds that Defendant’s argument holds no water.
Now, as to the EEOC’s complaint that Ventura has hindered its ability to
litigate this case by destroying key e-mail accounts of decision-makers in the
termination of Zayas, the Defendant’s explanation is as follows:
Ventura understands that Jésika Ruiz and María Mojica’s
emails were lost during a system migration, but who
knows whether those employees actually erased their
emails from all electronic records at the Company prior
to their departure since both employees were actually
terminated by Ventura. Those two employees were
terminated
involuntarily
from
their
employment
positions at Ventura and since they did not leave the
Company in good terms, it is uncertain whether any
emails really existed for them in Ventura’s databases
at the time of such migration or whether such employees
had cleaned their email accounts before leaving the
Company . At the time that the instant Complaint was
filed neither Jésika Ruiz nor María Mojica were
employed by Ventura.
See Docket No. 49 at page 21. The Defendant’s vague explanation is simply
insufficient. First of all, Ventura is under an obligation to make certain
that disgruntled or dismissed employees do not destroy company records.
Secondly, the changes to Ventura’s computer systems admittedly took place in
2010 and Ventura was under notice to preserve relevant evidence for this case
since 2007. Pursuant to the applicable caselaw, the obligation to preserve
relevant evidence “arises once litigation is reasonably anticipated.” Perez
v. Hyundai Motor Co., 440 F.Supp.2d 57, 60 (D.P.R. 2006). In fact, in its
response, the Defendant stays short of admitting, but certainly implies, that
it was reasonably foreseeable that Zayas would file suit in court after he
received a right-to-sue letter from the EEOC. See Docket No. 49 at page 30.
The e-mails of key decision-makers regarding Zayas’ employment was certainly
relevant as it is, under the applicable regulation, a type of “other records
having to do with … termination,” 29 C.F.R. § 1602.14. According to Ventura,
“Jésika Ruiz worked at Ventura until November 17, 2008 and María Mojica worked
at Ventura until 2010.” See Docket No. 21 at page 40. Therefore, Ventura had
over a year between the date in which Zayas filed his first administrative
claim before the EEOC and Ruiz’s termination to preserve these e-mail accounts
and any relevant content therein.
Finally, in its opposition to the EEOC’s motion requesting sanctions, the
Defendant states that the only claim it had before the EEOC was Zayas’ charge
of discrimination, and it was not until the EEOC filed the complaint in this

CIV. NO. 11-1700(PG)

Page 8

case that it learned that the EEOC was suing on behalf of a class of male
applicants who were adversely affected by Ventura’s alleged discriminatory
practices. See Docket No. 49 at page 3. This, Ventura now claims, it could not
have reasonably anticipated. Id. at 4. With this the Court agrees. As set
forth by the Defendant, the discrimination charges before the EEOC were filed
exclusively by Zayas and Ventura could not have reasonably foreseen that the
EEOC would file suit on behalf of a “hypothetical class of persons and
unidentified male job applicants who were not part of the discrimination
charge filed by Zayas … .” Docket No. 49 at page 11. Therefore, the EEOC’s
request for sanctions for the spoliation of evidence will only be considered
as to Zayas’ case.
Having established that the résumés of job applicants and e-mail accounts
of decision-makers are relevant evidence to this case and should have been
preserved since the date of Zayas’ charge before the EEOC in 2007, the Court
thus moves on to determine what is the appropriate sanction to impose in light
of Ventura’s failure to preserve said evidence.
“If the court finds that a party is accountable for the spoliation it may
impose sanctions to avoid unfair prejudice to the opposing party.” Velez, 590
F.Supp.2d at 258. “Sanctions for spoliation range from dismissal of the
action, exclusion of evidence or testimony or instructing the jury on a
negative inference to spoliation whereby jury may infer that party that
destroyed evidence did so out of realization that it was unfavorable.” Hyundai
Motor, 440 F.Supp.2d at 62. “The measure of the appropriate sanctions will
depend on the severity of the prejudice suffered.” Id. at 61. “Prejudice will
be measured by the degree in which [a party’s] “ability to mount an adequate
defense” has been hampered.” Id. (citing Perez-Velasco, 266 F.Supp.2d at 269).
“Under settled authority, the district court has inherent power to
exclude evidence that has been improperly altered or damaged by a party … .”
Collazo-Santiago v. Toyota Motor Corp., 149 F.3d 23, 28 (1st Cir.1998)
(internal citation omitted).
The intended goals behind excluding evidence, or at the
extreme, dismissing a complaint, are to rectify any
prejudice the non-offending party may have suffered as
a result of the loss of the evidence and to deter any
future conduct, particularly deliberate conduct,
leading to such loss of evidence … Therefore, of
particular
importance
when
considering
the
appropriateness of sanctions is the prejudice to the
non-offending party and the degree of fault of the
offending party.

CIV. NO. 11-1700(PG)

Page 9

Velez, 590 F.Supp.2d at 258 (internal citation omitted). First Circuit caselaw
does not require bad faith or comparable bad motive to support a district
court’s decision to exclude evidence as a sanction for spoliation. See Trull
v. Volkswagen of America, Inc., 187 F.3d 88, 95 (1st Cir.1999).
As a result of the Defendant’s failure to preserve all of the relevant
job application materials, the EEOC and Zayas are unfairly disadvantaged. The
EEOC and Zayas are now hindered in their ability to establish that the
testimony of Ventura’s officials who state that male applicants for the Zone
and Support Manager positions were either unqualified or less qualified than
women has no basis. In addition, as a result of the destruction of the e-mail
accounts in question, the EEOC and Zayas may not be able to adequately
challenge the testimony of Ventura officials who will testify that Zayas was
discharged because of his poor performance. They are also at a disadvantage
in their ability to establish that Ventura’s proffered reason for Zayas’
termination is a pretext for discrimination and retaliation. As a result of
the foregoing, the Court must sanction Ventura for the prejudice it caused the
EEOC and Zayas.
In its motion for sanctions, the EEOC thus requests that this court
exclude all testimonial evidence offered by Ventura regarding the number of
men that applied to the positions of Zone Manager or Support Manager between
2004 and 2009 and regarding the qualifications of applicants during that
period of time. It also requests that this Court allow the trier of fact to
infer that all applications for Zone Manager and Support Manager positions
between 2004-2009, which were destroyed by Ventura in 2009, would have shown
comparable information regarding the percentage of qualified male applicants
as those applications that were not destroyed. See Docket No. 42. In its
response, the Defendant claims that the remedy the EEOC requests is too harsh
a

punishment

to

overcome

and

that

no

evidence

exists

that

Ventura

intentionally disposed of documentation in order to gain an advantage in the
current litigation. See Docket No. 49 at pages 23, 37-39. The Court disagrees
with Ventura. A court may impose sanctions, including exclusion of evidence,
even “[i]f such evidence is mishandled through carelessness … .” Trull, 187
F.3d at 95 (citing Sacramona v. Bridgestone/Firestone, Inc., 106 F.3d 444,
447, 446 (lst Cir.1997)). Therefore, as a result of Ventura’s spoliation of
relevant job application materials, Ventura will be precluded from offering
any evidence regarding the number of men that applied to the positions of Zone
Manager

or

Support

Manager

between

2007

and

2009

and

regarding

the

CIV. NO. 11-1700(PG)

Page 10

qualifications of applicants during that period of time. See Colon v. Blades,
268 F.R.D. 129 (D.P.R. 2010) (finding appropriate spoliation sanction against
party for inability to produce documents was to preclude it from offering the
documents as evidence or any testimony related thereto).
The EEOC also requests that this Court allow the trier of fact to infer
that the content of emails contained in Mojica and Ruiz’s e-mail accounts
would have been unfavorable to Ventura. See Docket No. 42. “A ‘spoliation’
instruction, allowing an adverse inference, is commonly appropriate … where
there is evidence from which a reasonable jury might conclude that evidence
favorable to one side was destroyed by the other. … The burden is upon the
party seeking the instruction to establish such evidence.” U.S. v. Laurent,
607 F.3d 895, 902 (1st Cir.2010). The EEOC has established that an e-mail from
decision-makers discussing the termination of Zayas’ employment just six
months after his appointment in fact existed and were destroyed. The e-mail
that Zayas produced aids to prove his allegation that “[a]fter his placement
to the position of Zone Manager, Ventura immediately targeted [him] for
termination.”

Plaintiff

Intervenor

Complaint,

Docket

No.

14

at

¶

19.

Therefore, it can be inferred that the content of other similar e-mail
communications that are now unavailable would have further supported the
EEOC’s and Zayas’ version of events. Thus, in the context of the evidence
before the Court now, we find that an adverse-inference instruction makes
sense here. As a result, a jury in this case will be instructed to infer that
the content of emails contained in Mojica and Ruiz’s e-mail accounts would
have been unfavorable to Ventura.
C. CONCLUSION
Pursuant to the foregoing, the EEOC’s motion for sanctions (Docket
No. 42) is hereby GRANTED IN PART AND DENIED IN PART.
IT IS SO ORDERED.
In San Juan, Puerto Rico, February 12, 2013.
S/JUAN M. PEREZ-GIMENEZ
JUAN M. PEREZ-GIMENEZ
U.S. DISTRICT JUDGE