Procrastinators Beware: Default Judgment as a Discovery Sanction

05/23/2023

By:  Noah A. Ligeti

The United States District Court in Boston recently held in Costa v. Saki, LLC, that default judgment is an appropriate remedy against those who show that they are clearly unwilling to participate in the discovery process in good faith. Plaintiff Travis Costa, a seasonal restaurant worker, brought suit against his former employer alleging violations of the Massachusetts Wage Act, the Fair Labor Standards Act, and the Massachusetts Overtime law. Shortly after amending his complaint, in late July, 2021, Mr. Costa’s counsel sent routine discovery requests to the employer’s counsel: one set of document requests and one set of interrogatories. What followed can only be described as a tortured succession of delay, failure to engage, and feeble excuse-making on behalf of the employer.

Between July, 2021 and December, 2021, employer’s counsel failed to make any response to the discovery requests, and missed three extension deadlines graciously allowed by Plaintiff’s counsel. The employer’s counsel first represented that he would provide a discovery response “shortly”, then cited his “heavy workload”, then assured the plaintiff that he was working “diligently with [his] client” to complete the discovery requests. Finally, he stated that he had not yet received responsive discovery from his client. Notably, employer’s counsel never took the initiative to contact Plaintiff’s counsel. Rather, Mr. Costa’s attorney initiated contact with her opponent and liberally granted extensions.

By January, 2022, by the time the employer appeared for his deposition remotely, no discovery responses and had been provided. The District Court took particular note of the fact that the employer appeared over an hour late for his deposition, was dressed in beach attire, and dialed in remotely from a resort in Belize. Critically, the employer testified that he did not know where Mr. Costa’s time and pay records were located, directly contradicting his counsel’s prior statements. The employer’s record keeper testified in a separate deposition that the employer was directly involved in both the creation and storage of the Plaintiff’s pay records. In a discovery conference between counsel following the depositions, the employer’s attorney stated that the interrogatory answers were complete, but for his client’s signature. Over seven months after service of the discovery requests, the employer finally produced unsigned, incomplete, and evasive interrogatory responses—the only discovery response he provided in the entire case.

Ultimately, the District Court found that the employer had engaged in a bad-faith pattern of “stone-walling and sanctionable conduct,” with the actions of both the attorney and client amounting to a “dereliction of duty.” The court allowed the Plaintiff’s motion for a default judgment, effectively ruling in Plaintiff’s favor on all issues—with the stated aim of discouraging this type of conduct. The Plaintiff was awarded mandatory treble damages and attorneys’ fees pursuant to the Plaintiff’s Wage Act claims.

Take Away:

Failing to respond to discovery—particularly when combined with a dismissive attitude and evasive tactics—may result in the ultimate sanction; the entry of judgment on all counts against the party engaging in bad faith actions to avoid discovery.