Malautea v. Suzuki Motor Co., Ltd.

• Decision Date: 09 April 1993
• Docket Number: Nos. 92-8029,92-8175,s. 92-8029
• Citation: 987 F.2d 1536
• Parties: Gayle White MALAUTEA, as guardian of Fati F. Malautea and Gayle White Malautea, individually and as class representative, Thomas Nash, co-guardian of Fati F. Malautea, Plaintiffs-Appellees, v. SUZUKI MOTOR COMPANY, LTD., a Japanese Corporation, American Suzuki Motor Corporation, a California Corporation, Defendants-Appellants, Joe C. Freeman, Jr., Michael J. Goldman, Philip Siracuse, Patrick J. Becherer, James Deroche, Appellants.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1536

987 F.2d 1536

25 Fed.R.Serv.3d 560

Gayle White MALAUTEA, as guardian of Fati F. Malautea and Gayle White Malautea, individually and as class representative, Thomas Nash, co-guardian of Fati F. Malautea Plaintiffs-Appellees, v. SUZUKI MOTOR COMPANY, LTD., a Japanese Corporation, American Suzuki Motor Corporation, a California Corporation, Defendants-Appellants Joe C. Freeman, Jr., Michael J. Goldman, Philip Siracuse Patrick J. Becherer, James Deroche, Appellants.

Nos. 92-8029, 92-8175.

United States Court of Appeals, Eleventh Circuit.

April 9, 1993.

Joe C. Freeman, Jr., Michael J. Goldman, Freeman & Hawkins, Atlanta, GA, Philip L. Siracuse, James D. DeRoche, Crosby, Heafy, Roach & May, Los Angeles, CA, Patrick J. Becherer, Crosby, Heafy, Roach & May, Oakland, CA, C.B. Rogers, James W. Beverage, Richard H. Sinkfield, Rogers & Hardin, Atlanta, GA, for defendants-appellants.

Kenneth L. Royal, Savannah, GA, Patrick A. Dawson, James E. Butler, Jr., Robert D. Cheeley, Butler, Wooten, Overby & Cheeley, Atlanta, GA, for plaintiffs-appellees.

Francis H. Hare, Jr., Legal Counsel, The Attys. Information Exchange Group, Inc., Birmingham, AL, for amicus--The Attys. Information Exchange Group, Inc.

Appeals from the United States District Court for the Southern District of Georgia.

Before FAY and ANDERSON, Circuit Judges, and RONEY, Senior Circuit Judge.

FAY, Circuit Judge:

The defendants and their attorneys appeal sanctions imposed on them for grave and repeated abuses of the discovery process. In the district court, the defendants continually and willfully resisted discovery, even deliberately withholding discoverable information that the judge had ordered them to produce. As a result, the district judge, pursuant to FED.R.CIV.P. 37(b)(2)(C), struck their answers and entered a default judgment against them on the issue of liability. Pursuant to 28 U.S.C. § 1927 and FED.R.CIV.P. 26(g), he ordered the defendants and their attorneys held jointly and severally responsible for the plaintiff's costs and attorneys' fees. Finally, pursuant to the court's inherent powers, the district judge fined each defendant $5,000 and each defense attorney of record $500. The district judge's factual findings in support of these sanctions are not clearly erroneous. Moreover, we find no abuse of discretion in the sanctions chosen or the process accorded the appellants before sanctions were imposed. We affirm the district judge's order imposing sanctions on the defendants and their attorneys.

FACTS AND PROCEDURAL HISTORY

This case arose out of a traffic accident in which the plaintiff's husband, ¹ Fati F Malautea, was severely injured. After colliding with another car, Mr. Malautea's 1988 1/2 Suzuki Samurai rolled over, and Mr. Malautea sustained serious head and spinal cord injuries. The plaintiff sued defendants Suzuki Motor Corporation and American Suzuki Motor Corporation, alleging that defects in Mr. Malautea's Suzuki Samurai caused or aggravated his injuries. From the beginning of the discovery process, the defendants stubbornly withheld discoverable information by improperly objecting to interrogatories and by providing only partial responses to the interrogatories they answered. Because the parties were unable to resolve their discovery disputes, the plaintiff indicated in a joint status report filed July 2, 1991 that she would move the court to compel the defendants to provide the discovery she requested.

The plaintiff filed a motion to compel on July 23, and United States District Judge Avant Edenfield considered the motion during a routine status conference on July 24. Judge Edenfield orally ordered the defendants to produce most of the information the plaintiff sought, including "testing from Suzuki ... before the vehicle was released [and] documents dealing with certain design issues involved in the case such as body structure." R-15-250-3. The judge sternly warned the defendants, "I am going to start striking answers unless [the information requested] comes forward.... [Defense counsel] are trying to withhold information. I am not going to take it.... You produce it." Id. Throughout the status conference, Judge Edenfield made absolutely clear his order that the defendants produce the information that the plaintiff requested, even if they thought the plaintiff's requests were overly broad. Two days after the status conference, Judge Edenfield confirmed his oral order with a written "Minute Order," compelling the production of "all discovery pertaining to 'rollover' accidents, seat-belt failures, design and testing materials on all Suzuki Samurais manufactured since 1984, and materials relating to marketing and public relations, within fifteen (15) days." R-3-38.

Even after Judge Edenfield extended the time allowed for the defendants to comply with this discovery order, the discovery abuses continued. In spite of two orders from the Magistrate Judge to produce deposition transcripts requested by the plaintiff, the defendants delayed until the day the plaintiff filed a motion for sanctions. Attempting to resolve the remaining discovery disputes, on August 30 Judge Edenfield entered a ten page order again requiring the production of "any material subject to a previous order...." R-5-38-10. Judge Edenfield warned that "the Court is outraged by the dilatory tactics of the parties in this case." R-5-38-1. For the second time, he warned the defendants that "[f]ailure to [produce the requested material] will result in the Court's striking of all defensive pleadings." R-5-38-9. Finally, Judge Edenfield advised the parties that he would "hold a hearing to determine whether the Defendants and/or the Plaintiffs should be sanctioned for their dilatory discovery tactics." R-5-38-10. Still, in spite of repeated warnings and the prospect of a sanctions hearing, the defendants failed to produce much of the information they twice had been ordered to produce.

As promised, Judge Edenfield held a sanctions hearing on December 13, 1991 and allowed each side one hour to present arguments and evidence. The defendants, however, presented no evidence showing that their failure to comply with the discovery orders was due to misunderstanding or inability to comply. On December 30, the judge entered an order imposing sanctions on the defendants, the defendants' attorneys, and the plaintiff's attorneys. ² In this order, Judge Edenfield detailed the discovery abuses in this case, his factual findings, and his reasons for sanctioning the litigants and counsel as he did. The judge found that the defendants had delayed producing documents and had given misleading answers to interrogatories and requests to produce, "using a number of techniques to obfuscate the truth." R-15-250-8.

Judge Edenfield specifically discussed four methods that the defendants and their attorneys used to resist discovery. First, he found that the defendants improperly refused to answer interrogatories on the ground that certain words and phrases were not defined. For example, the defendants balked at phrases such as "tests, research or other investigation," "risk of rollover," "risk of personal injury," "substantially similar," "change, alteration or modification," and "engineer." Judge Edenfield found that these words and phrases were not ambiguous in the context of the plaintiff's questions. He concluded that the defendants' objections were "part of their overall plan to obstruct the Plaintiff's discovery attempts" and that "no sanction ... will change this aspect of the Defendants' conduct." R-15-250-9, 10.

Second, Judge Edenfield found that the defendants and their counsel resisted discovery orders by improperly "refus[ing] to answer general questions, choosing instead to limit the question to a narrower field." R-15-250-10. For example, when the plaintiff requested information regarding several model years, the defendants limited their responses only to the 1988 1/2 model year. When the plaintiff asked about several vehicles similar to the Samurai, the defendants limited their answers to the Samurai itself. In this way, the defendants avoided revealing a great deal of discoverable information regarding testing and changes in the design of the Samurai.

Third, Judge Edenfield found that the defendants' delay in producing deposition transcripts, after the Magistrate Judge twice ordered their production, hampered the plaintiff's attorneys' efforts to prepare their case. The delay "denied the Plaintiff's counsel time for a meaningful review of the earlier depositions before conducting their own depositions." R-15-250-18. Ultimately, the plaintiff had to file a motion for sanctions to force the defendants to comply with the court's orders. At the sanctions hearing, defense counsel illustrated the defendants' cavalier attitude toward the court's discovery orders by claiming to have forgotten to comply with the two orders to produce the transcripts. No matter whether the defendants "forgot" to comply with two court orders or deliberately delayed production to sabotage the plaintiff's depositions, Judge Edenfield found that the defendants' intransigence hampered the discovery process and showed disdain for the court's orders.

Finally, Judge Edenfield found that the prime example of the defendants' resistance to discovery was their deliberate cover up of damaging evidence regarding General Motors' refusal to market the Samurai in the United States. The plaintiff specifically requested this information through interrogatories. ³ R-15-250-12-13. After objecting to the question as vague and overly broad and burdensome, the defendants answered that they were "unaware of any decision by General Motors not to market the Samurai" and "there was no decision not to market a vehicle of the same design as the Samurai." R-15-250-13, 14. In spite of the July 24, July 26, and August 30 court orders compelling responses to the plaintiff's interrogatories, "[n]either defenda...