691 F.Supp.3d 32
D.D.C.2023Background
- Plaintiffs Ruby Freeman and Wandrea’ Moss sued Rudolph W. Giuliani for defamation, IIED, civil conspiracy, and punitive damages based on his post‑2020 election statements; discovery was ordered and extended repeatedly.
- The FBI seized many of Giuliani’s devices in April 2021; Giuliani produced an initial limited set of documents (193) and later a bulk TrustPoint data dump that contained many unreadable blobs.
- The court repeatedly ordered Giuliani to describe preservation/search efforts, to search TrustPoint and other accounts, and to produce financial records (RFPs 40–41) and business metrics (RFPs 19, 35); Giuliani’s responses were vague or incomplete.
- Giuliani submitted unsworn stipulations purporting to concede liability, but reserved legal defenses and appeal rights; the stipulations did not substitute for discovery.
- Plaintiffs moved for sanctions for failure to preserve ESI and for noncompliance with discovery orders; the court found willful preservation and production failures and extensive prejudice to plaintiffs.
- The court entered default judgment as a discovery sanction under Fed. R. Civ. P. 37(e)(2)(C) and 37(b)(2)(A)(vi) as to liability, awarded attorneys’ fees, and ordered limited further discovery on damages and business metrics by specified deadlines or additional sanctions.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Giuliani failed to preserve ESI and spoliated evidence under Rule 37(e) | Giuliani should have preserved ESI by early 2021, took only minimal steps (turned off auto‑delete), and lost irreplaceable ESI, prejudicing plaintiffs | FBI seizure or vendor conduct caused loss; TrustPoint contains full extracts; stipulations moot discovery needs | Court: Giuliani failed to take reasonable preservation steps, ESI is irretrievably lost, and Rule 37(e)(2) sanctions appropriate (intent to deprive inferred) |
| Whether sanctions under Rule 37(b) are warranted for violating court discovery orders (produce RFPs, pay fees) | Giuliani ignored multiple orders to search, produce documents (including financials), and pay court‑ordered fees; his noncompliance prejudiced plaintiffs and burdened the court | Giuliani says stipulations concede liability so further discovery is unnecessary; cites financial hardship and disputes scope | Court: Giuliani violated discovery orders; Rule 37(b) sanctions appropriate (including default as to liability and fee awards); discovery on damages still required |
| Appropriateness of default judgment as a discovery sanction | Default is warranted because misconduct was willful, prejudiced plaintiffs, and lesser sanctions would not suffice | Stipulations and reservations show willingness to concede; default is extreme and unnecessary | Court: Default judgment on liability imposed under Rules 37(e)(2)(C) and 37(b)(2)(A)(vi); reasons: severe prejudice, delay, willfulness, and deterrence |
| Scope of relief remaining (damages discovery, business subpoenas, fee recovery) | Plaintiffs asked for continued discovery on damages, business metrics and reimbursement of attorneys’ fees from Giuliani and his businesses | Giuliani/businesses asserted lack of assets and argued veil piercing required to hold him liable for business fees; also claimed some discovery moot due to stipulation | Court: Permitted limited discovery on damages and business metrics by deadline; ordered businesses to produce metrics and pay $43,684; Giuliani personally liable if businesses fail to pay; awarded plaintiffs fees (including $89,172.50) and fees for the sanctions motion |
Key Cases Cited
- Seattle Times Co. v. Rhinehart, 467 U.S. 20 (U.S. 1984) (discovery is broad and may intrude on privacy; rules permit liberal discovery).
- New York Times Co. v. Sullivan, 376 U.S. 254 (U.S. 1964) (actual malice standard for defamation of public figures).
- Harte‑Hanks Commc’ns, Inc. v. Connaughton, 491 U.S. 657 (U.S. 1989) (actual malice may be proved by circumstantial evidence of state of mind).
- Gerlich v. U.S. Dep’t of Justice, 711 F.3d 161 (D.C. Cir. 2013) (preservation obligations attach when litigation is reasonably foreseeable).
- Zubulake v. UBS Warburg LLC, 220 F.R.D. 212 (S.D.N.Y. 2003) (litigation hold and reasonable ESI preservation steps required).
- Webb v. District of Columbia, 146 F.3d 964 (D.C. Cir. 1998) (factors supporting dismissal/default as sanctions).
- WMATC v. Reliable Limousine Serv., 776 F.3d 1 (D.C. Cir. 2015) (default requires willfulness, bad faith, or fault).
- Borum v. Brentwood Vill., LLC, 332 F.R.D. 38 (D.D.C. 2019) (Rule 37(e) preconditions for spoliation).
- Paisley Park Enters., Inc. v. Boxill, 330 F.R.D. 226 (D. Minn. 2019) (failure to back up phones and preserve texts is unreasonable).
- Beck v. Test Masters Educ. Servs., Inc., 289 F.R.D. 374 (D.D.C. 2013) (sanctions for conscious disregard of preservation obligations).
- Motorola Credit Corp. v. Uzan, 509 F.3d 74 (2d Cir. 2007) (permissive and, in special circumstances, stronger adverse inferences for net‑worth concealment).