Grady v. Brodersen, No. 13-cv-00752-REB-NYW, 2015 U.S. Dist. LEXIS 35788 (D. Colo. Mar. 23, 2015).
The court declined to enter a default judgment in this copyright infringement case, finding an adverse inference instruction was an adequate remedy for the spoliation.
In this case, the plaintiff, James Grady, asserted that the defendant, Evan Brodersen, copied his copyrighted images and posted them on the Internet. The court issued a scheduling order that required Brodersen to preserve all of his electronically stored information (ESI) and identify his relevant data sources.
Although Brodersen informed the court in his initial disclosures on February 27, 2014 that his computers contained relevant data and he had searched for that data, he did not produce any such information to Grady for the next seven months. In August 2014, after Grady filed a motion to compel the production of Brodersen’s computer, Brodersen amended his initial disclosures. He then informed Grady that he discarded the computer he owned during the relevant period because it “died.” He later added in a supplemental disclosure that the computer malfunctioned in 2012 and died in July 2013. He claimed he attempted to repair it but did not copy it for forensic examination. He testified that his attempts to transfer the data from his old computer were futile. He also asserted that the pictures he uploaded to the website in question were provided to him on a flash drive by his client.
The court granted Grady’s motion in part, requiring Brodersen to produce his new computer for inspection, but denied the motion as to the old, discarded computer. Grady’s forensic experts found that Brodersen began to use the computer in November 2013—three months after he allegedly discarded his old computer. They also found that more than 10,000 images, with file modification dates as early as February 2011, were transferred to the new computer on January 19, 2014, shortly after the court recommended denying Brodersen’s motion to dismiss.
Grady then asked the court for sanctions, including a default judgment. The court agreed that Brodersen had engaged in intentional, bad faith spoliation that prejudiced Grady. The computer was the sole source of evidence that would show whether Brodersen altered and used Grady’s copyrighted works. Brodersen had also violated Federal Rule of Civil Procedure 26(g) by failing to specify what computer equipment was within his custody and control and been less than forthcoming in discovery. However, the court found a default judgment too severe to protect Grady and deter Brodersen from future violative conduct and instead issued a lesser sanction of an adverse inference instruction and attorneys’ fees and costs.
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Given the circumstances and timing in this case, the defendant here was fortunate to suffer only an adverse inference. His continuing misrepresentation in his initial disclosures, after he failed to disclose the loss of his computer for seven months, was inexcusable. Moreover, the timing of the transfer of images to his new computer was troubling. In another case, this behavior could have merited a case-dispositive sanction.