A federal magistrate judge in Maryland has determined that the plaintiffs in a case involving alleged patent and copyright violations incurred $1.05 million in reasonable costs and attorney’s fees for discovery “that would not have been undertaken but for Defendants’ spoliation, as well as the briefings and hearings regarding Plaintiff’s Motion for Sanctions.” Victor Stanley, Inc. v. Creative Pipe, Inc., No. 06-2662 (U.S. Dist. Ct., D. Md., order entered January 24, 2011). Additional information about the case appears in the September 30, 2010, Issue of this Report.
The court declined the defendants’ request to limit the fees to activity occurring after the spoliation was discovered, finding that “the effects of spoliation are not limited to a party’s efforts to discover and to prove the spoliation and its scope. Rather, the willful loss or destruction of relevant evidence taints the entire discovery and motions practice.” The court had already found that the spoliation began with the onset of litigation, thus, it found that “Defendants’ misconduct affected the entire discovery progress since the commencement of this case.”
According to the court, the sanctions were imposed to punish the defendants’ contempt in failing to comply with multiple court orders compelling the preservation and production of electronically stored information in response to discovery requests, as well as the defendants’ “overall behavior” including spoliation of evidence and the failure of the defendant company’s president “to tell the truth under oath during court hearings regarding the spoliation.” The court characterized the contempt as conduct that “unnecessarily but voraciously consumed the Court’s time and resources, and assuredly burdened Plaintiff and its counsel to an even greater extent.”