It’s Anything But Smooth Sailing When You Spoliate Evidence
Hausman v. Holland Am. Line-U.S.A., No. CV13-0937 BJR, 2016 WL 51273 (W.D. Wash. Jan. 5, 2016).
The court vacated a $21.5 million jury verdict after evidence came to light showing that the plaintiff deleted and failed to disclose e-mails during discovery.
In this negligence case, a cruise line passenger, James Hausman, sued Holland America for brain injuries that occurred as the result of an automatic sliding glass door on the ship closing “suddenly and unexpectedly” and striking his head. In October 2015, the court held a two-week jury trial that led to a verdict for Hausman. The court entered judgment for Hausman on November 4, 2015.
Two weeks later, Hausman’s former personal assistant, Amy Mizeur, approached Holland America and alleged Hausman had deleted and failed to disclose relevant e-mails, tampered with witness testimony, fabricated and exaggerated his injuries, and testified falsely at trial. Holland America filed a motion to vacate the judgment and sought dismissal or a new trial. Along with the motion, Holland America provided copies of Hausman’s deleted e-mails that Mizeur recovered.
The court then held an evidentiary hearing that focused on the issue of the e-mails and evaluated whether Hausman obtained the judgment by “fraud, misrepresentation, or misconduct.” A failure to disclose or produce e-mails, whether accidental or intentional, could constitute adequate misconduct to overturn a judgment if it “‘substantially . . . interfered’ with the ‘aggrieved party’s ability fully and fairly to prepare for and proceed at trial.’”
At the hearing, Mizeur testified that Hausman “‘panicked’” when he learned he would have to produce e-mails in discovery that contained search terms such as “sex,” “love,” “beer,” and “relationship” and searched and deleted messages nonstop for several days, which was unusual since he routinely saved all of his messages. Mizeur also testified that Hausman directed her to delete all e-mails between them from her computer and phone and that he failed to disclose a second personal e-mail account. Mizeur recovered approximately 70 e-mails that Hausman deleted and never produced, a third of which contained relevant keywords.
The plaintiff contended that Mizeur’s account was the false testimony of a disgruntled employee whom he fired for forging a check. He admitted that he failed to produce the e-mails and that some recovered e-mails contained search terms. Even so, he claimed he had a routine practice of deleting e-mails and had deleted the messages before they were requested in discovery. He also said his secondary personal e-mail account was inactive by the time of the discovery requests.
The court weighed the credibility of Hausman and Mizeur, finding Mizeur believable but Hausman “evasive and untrustworthy.” The court said Hausman “appeared to weigh each answer, not for its truthfulness, but to assess whether it would damage his case.” Hausman’s e-mails also “expose[d] grave inconsistencies” in his testimony. For example, though he professed to avoid ladders because he was afraid of reinjuring himself, one message revealed that Hausman “spent most of the day” on a ladder removing snow and ice from his house.
The court concluded that Holland America established that Hausman intentionally deleted and failed to disclose his e-mails. Therefore, Holland America was entitled to the presumptions that Hausman’s deliberate suppression substantially interfered with its trial preparation and that the e-mails were relevant to its case. Hausman could not muster clear and convincing evidence that the e-mails he withheld were inconsequential. Therefore, to set right the “miscarriage of justice that occurred in this case,” the court granted Holland America’s motion to vacate the judgment and ordered a new trial.
Can it ever be too late to punish a party for the spoliation of evidence? Perhaps. Parties must file grounds for relief from a final judgment “within a reasonable time” and no more than a year after entry of the judgment where the party alleges an opposing party’s fraud, misconduct, or misrepresentation. However, parties that discover evidence later could file a motion to set aside a judgment for “fraud on the court” under Rule 60(d)(3), to which no time limit applies. But, to fall within the purview of this rule, the circumstances would have to be egregious, typically involving the participation of counsel.