eDiscovery Daily Blog

Sanctions for Violating Motion to Compel Production? Not Yet. – eDiscovery Case Law

In Fidelity National Title Insurance Co. v. Captiva Lake Investments, LLC, No. 4:10-CV-1890 (CEJ), 2012 U.S. Dist. (E.D. Mo. Nov. 16, 2012), where a party’s “conduct [did not] rise[ ] to the level of a willful violation of the order compelling production” because it was continually working toward the proper production of documents requested by its adversary, a court concluded that the adversary’s motion for sanctions was premature.

Involved in a declaratory judgment action related to policy coverage, Captiva Lake Investments asked insurer Fidelity National to produce the claims file and documents in its possession that were related to Fidelity’s “evaluation of coverage under the policy at issue.”

Fidelity responded but did not produce or include in its privilege log two categories of documents: the Major Claims Reports and data maintained in Fidelity’s Claims Processing System (“CPS”). When Captiva discovered this, it requested the data, but Fidelity merely produced an updated privilege log, claiming it could withhold the documents under privilege. Captiva filed a motion to compel, and the court granted it, ordering Fidelity to produce the information. Fidelity, however, still failed to produce only some of the requested data. Captiva then filed this motion for sanctions.

The court noted that under Rule 37 of the Federal Rules of Civil Procedure, “‘there must be an order compelling discovery, a willful violation of that order, and prejudice to the other party’” in order for the court to properly impose sanctions. Here, although Fidelity had produced only some of the information requested by Captiva, and although “the proceedings in this case present an extremely unflattering picture of Fidelity’s document and data management practices,” Fidelity was continuing to attempt to locate additional missing reports and was producing ones that it found; in addition, after producing some—but not complete—information from the CPS, Fidelity indicated to Captiva that it “‘was in contact with e-discovery specialists to figure out what else can be done with respect to the information in CPS.’”

Therefore, the court found that Fidelity’s failure to produce the data was not a willful violation of the order compelling production and denied Captiva’s motion for sanctions.

So, what do you think?  Should Fidelity have been sanctioned for failing to complete production?  Please share any comments you might have or if you’d like to know more about a particular topic.

Case Summary Source: Applied Discovery (free subscription required).  For eDiscovery news and best practices, check out the Applied Discovery Blog here.

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