Default Judgment Entered Against Defendant in 10th Circuit Discovery Abuse Case
In Klein-Becker USA, LLC v. Englert, No. 12-4076, (10th Cir. 2013), plaintiff brought an action against an individual defendant who fraudulently acquired the plaintiff’s product and was selling it online. The defendant resisted plaintiff discovery requests from the start. Early in the case, in ruling on plaintiff’s motion for sanctions, the magistrate judge found the defense production “inadequate” and “almost contemptuous.” The plaintiff filed a second motion for sanctions, and the judge next found the defendant “deliberately withheld information and intentionally caused delay.”
Defendant’s attorney then withdrew as counsel, which resulted in the defendant even less accommodating regarding his discovery obligations. The court warned the defendant multiple times that discovery abuses would lead to sanctions, including a default judgment entered against him. When defendant failed to appear in court on a third motion for sanctions, the court granted a default judgment for plaintiff and ordered $773,384 in damages, plus all attorney fees and costs.
Under Federal Rule 37(b)(2)(A)(vi), a court can issue sanctions for disobeying a discovery order, including entering a default judgment against the violating party. A default judgment is used when a party’s noncompliance is due to “willfulness, bad faith, or any fault of the [disobedient party]” and usually not when a party is unable to comply with a discovery order.
In a decision dated March 27, 2013, the 10th Circuit ruled that defendant’s position that he was a pro se litigant did not excuse his discovery non-compliance. In finding that the sanction was proper, the court considered:
- The degree of actual prejudice;
- The amount of interference to the judicial process; and
- The culpability of the litigant.
After reviewing the facts of the case and seeing how the defendant already had three motions for sanctions entered against him, and yet he continued to resist discovery, the court affirmed the dismissal and entry of judgment.