Calsep v. Dabral, 84f4th304

Calsep sued Ashish Dabral and his companies alleging misappropriation of trade-secret source code used to build InPVT after a former Calsep employee, Sah, joined Dabral and allegedly copied Calsep files to external drives.
Calsep sought production of Dabral’s complete source-code control system; the court entered a protective order requiring unmodified production and a preliminary injunction forbidding destruction of potentially relevant ESI.
Dabral produced multiple incomplete source-code productions; Calsep alleged intentional deletions and manipulation of the control-system data (including deletions after court orders), and moved for sanctions.
The magistrate judge found deliberate deletion, false affidavits, delayed and obstructive discovery, and recommended default judgment and damages; the district court adopted the recommendation and denied Dabral’s Rule 60(b) motion for reconsideration.
Dabral appealed; the Fifth Circuit reviewed sanctions for abuse of discretion and the Rule 60(b) denial for plain error and affirmed the district court.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether spoliation and discovery violations occurred	Dabral deleted/manipulated source-control data and violated multiple orders	Deletions were accidental, done by others or in ordinary course; productions were ultimately sufficient	Court found intentional deletions and multiple order violations; spoliation established
Whether conduct showed willfulness/bad faith	Pattern of delays, false affidavits, hiding servers, deletions after orders show bad faith	Blamed agents (brother/BPSS); denied personal culpability and intent	Court found willful, bad-faith conduct by Dabral (party responsibility for agent/company actions)
Whether prejudice warranted litigation-ending sanctions	Deletions prevented expert from performing necessary comparisons; case-in-chief impaired	Deleted data irrelevant or over‑exaggerated; lesser sanctions would suffice	Court held prejudice was substantial; default judgment proportionate given pattern and warnings
Whether newly discovered forensic images justify relief under Rule 60(b)	Images recently found replicate deleted data and would change outcome	Images were not newly discovered; existed in the record earlier and could have been obtained with diligence	Court (and Fifth Circuit) held images were not newly discovered or controlling; Rule 60(b) relief denied

Law Funder, L.L.C. v. Munoz, 924 F.3d 753 (5th Cir. 2019) (heightened four‑factor standard for litigation‑ending sanctions under Rule 37)
Guzman v. Jones, 804 F.3d 707 (5th Cir. 2015) (spoliation and Rule 37 sanctions principles)
Moore v. CITGO Refin. & Chem. Co., 735 F.3d 309 (5th Cir. 2013) (upholding dismissal in appropriate spoliation cases)
F.D.I.C. v. Conner, 20 F.3d 1376 (5th Cir. 1994) (articulating factors courts consider before imposing terminating sanctions)
Chambers v. NASCO, Inc., 501 U.S. 32 (1991) (scope and limits of courts’ inherent sanctioning powers)
In re Taxotere (Docetaxel) Products Liability Litig., 966 F.3d 351 (5th Cir. 2020) (lesser sanctions may be futile where party repeatedly disobeys discovery orders)
United States v. $49,000 Currency, 330 F.3d 371 (5th Cir. 2003) (pattern of discovery noncompliance justifies severe sanctions)
Vikas WSP, Ltd. v. Econ. Mud Prods. Co., 23 F.4th 442 (5th Cir. 2022) (warnings’ significance and need for careful findings when imposing extreme sanctions)
Bell v. Texaco, Inc., [citation="493 F. App'x 587"] (5th Cir. 2012) (willful noncompliance with discovery orders can justify dismissal)
Hesling v. CSX Transp., Inc., 396 F.3d 632 (5th Cir. 2005) (Rule 60(b) newly discovered evidence standard)