CONSOLIDATED INDUSTRIES, LLC, d/b/a WEATHER KING PORTABLE BUILDINGS v. JESSE A. MAUPIN, BARRY D. HARRELL, ADRIAN S. HARROD, LOGAN C. FEAGIN, STEPHANIE L. GILLESPIE, RYAN E. BROWN, DANIEL J. HERSHBERGER, BRIAN L. LASSEN, ALEYNA LASSEN, and AMERICAN BARN CO., LLC
No. 1:22-cv-01230-STA-jay
IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TENNESSEE EASTERN DIVISION
June 30, 2025
Before the Court is Plaintiff Consolidated Industries, LLC d/b/a Weather King Portable Buildings’ Motion for Sanctions (ECF No. 185). Defendants Jesse A. Maupin, Barry D. Harrell, Adrian S. Harrod, Logan C. Feagin, Stephanie L. Gillespie, Ryan E. Brown, Daniel J. Hershberger, and American Barn Co., LLC have responded in opposition. Plaintiff has submitted a reply brief. For the reasons set forth below, the Motion for Sanctions is GRANTED in part, DENIED in part.
BACKGROUND
This is an action for the misappropriation of trade secrets under federal and state law and for other tortious conduct under Tennessee common law. Plaintiff Consolidated Industries, LLC
Weather King employed Defendant Jesse Maupin as its Western Region Sales Manager. Id. ¶ 17. Maupin managed Weather King‘s manufacturing plants and sales representatives in Arizona, New Mexico, Colorado, and Texas, a territory Weather King dubbed the “the Western States.” Id. Weather King now alleges that Maupin misappropriated Weather King‘s trade secrets, recruited other key Weather King employees, and acted together with these individuals to use Weather King‘s protected information to form a rival company, American Barn, LLC (“American Barn“). The Amended Complaint would hold Maupin and American Barn liable for misappropriation of trade secrets in violation of
Weather King filed suit against American Barn and each of the individual Defendants on October 19, 2022. After Defendants answered (ECF No. 22) and filed a
Since that time, the Court has issued two rulings on requests for dispositive relief. On November 6, 2023, the Court denied Defendants’
Under the current case management order, the discovery deadline was June 2, 2025. The discovery phase of the case has been protracted, to say the least, drawn out largely over Plaintiff‘s attempts to discover evidence found in Defendants’ text messages and emails. According to Weather King‘s theory of the case, while still employed by Weather King, Defendants made their plans to create their own company, American Barn, and use Weather King‘s business model to compete directly with their former employer. Defendants discussed these plans by text and email, sometimes among themselves and other times with third parties who were existing customers doing business with Weather King and whom Defendants hoped to lure away as customers for
Although Defendants initially denied that such text messages or emails existed, Defendants eventually agreed to a forensic examination of their cell phones and laptops. The forensic examination revealed the existence of the sort of texts and emails Weather King had expected to discover from the start. Weather King now argues that Defendants acted in bad faith by failing to produce the information in the normal course of discovery and that the Court should enter a default judgment against Defendants as a sanction for their discovery abuse. As grounds for its request for sanctions, Weather King has shown that it addressed a litigation hold letter to each Defendant on June 13, 2022, less than two weeks after Weather King learned of Defendants’ plan to form their own company and Weather King‘s decision to terminate them. Three months later, after Weather King filed suit and served Defendants with written discovery requests, Defendants took the position that no texts or emails existed or had ever existed.1 When Weather King sought a court order to compel a forensic examination of the devices, the Magistrate Judge denied that request without prejudice to renew it at a later time. Instead, the Magistrate Judge stressed to Defendants the importance of their discovery obligations and ordered Defendants to supplement their discovery responses. The Magistrate Judge‘s order contained the following admonition: “Any further obfuscation on Defendants’ part may result in sanctions, which could include judgment entered in Plaintiff‘s favor and/or a finding” of contempt. Mag. J.‘s Order 11, Aug. 29, 2023 (ECF No. 111).
The forensic examination of Defendants’ devices revealed a substantial number of relevant texts. Faced with this proof to show that their discovery responses were incomplete or possibly false, Defendants have offered new explanations for the discrepancy as part of their testimony in their depositions. For example, Maupin admitted that he did not actually check his smartphone or laptop for any messages when he prepared his discovery responses. Maupin claimed that “other attorneys he knew” advised him the devices would inevitably be turned over in discovery. Maupin also testified that he did not understand the texts were considered “documents.” Defendants Barry D. Harrell, Adrian S. Harrod, and Logan C. Feagin also sat for depositions and offered their own testimony about the discovery of the texts. Harrell admitted he did not see the messages on his device and had no idea how he had overlooked them. But Harrod and Feagin testified they were confused about the litigation hold. Both cited a November 2022 letter Weather King subsequently addressed to customers in which Plaintiff asked the customers who were using Weather King building plans to cease and desist and also to destroy any electronic copies of the plans in their possession. Both admitted that they had deleted text messages from their devices because they
Weather King also argues that sanctions are warranted for Defendants’ interference with subpoenas Weather King had caused to issue as to several third parties. Weather King used the subpoenas to obtain texts and other communications between Defendants and Weather King customers from whom Defendants were allegedly soliciting business. Maupin admitted in his deposition that Defendants had attempted to help the third parties oppose the subpoenas. Maupin testified that Illinois attorney Douglas Hines, who is not counsel of record or a party to this action, drafted a form letter to oppose the subpoenas. Hines created the letter so that Defendants could share it with customers who had received Weather King‘s subpoenas. In his deposition Harrod testified that he had emailed the form letter to dealers doing business with American Barn and who had received subpoenas from Weather King. Maupin testified that Harrod had told one dealer Harrod did not want the dealer to cooperate with Weather King or comply with the subpoena.
Weather King argues that based on this record Defendants have acted in bad faith in the discovery process. Defendants have failed to produce all responsive documents to Weather King‘s discovery requests. Defendants Maupin, Harrod, and American Barn have interfered with Weather King‘s lawful subpoenas. Harrod and Feagin admitted that they spoliated evidence. And Weather King believes it still has not received all of the texts, including the text which it attached to its initial complaint. Weather King goes on to argue that all of the other factors for imposing sanctions are met in this case. Defendants’ discovery conduct has caused Plaintiff prejudice. Weather King was forced to spend over $154,000 on the forensic examination and incurred more than $167,000 in legal fees. In his order (ECF No. 111) entered on August 29, 2023, the Magistrate Judge warned Defendants about the possibility of default judgment as a sanction for discovery abuse. In light of
Defendants have responded in opposition to Plaintiff‘s Motion for Sanctions. Defendants argue that Weather King sent two different letters to individuals who are involved in the case, the June 2022 letter directing them to preserve documents and information and the November 2022 letter to destroy documents and information. Defendants assert that the contradictory nature of Weather King‘s letters resulted in confusion. Maupin testified that one of Weather King‘s owners Scott Berryman told him in conversation to disregard the June 2022 letter because “there wasn‘t going to be any lawsuit.” Defs.’ Resp. in Opp‘n 3 (quoting Maupin Dep. 513:15-514:04). Another vendor Old Hickory Buildings and Sheds then sent yet another letter to “former Weather King Dealers” asking them to destroy certain documents in their possession. Defendants claim that “[a]s the case progressed and Defendants came to better understand their obligations, they supplemented and amended their discovery responses, several times over in some instances.” Id. at 4.
The testimony of several Defendants during their depositions illustrates how Defendants were confused or unclear about their discovery obligations. Maupin testified that he did not understand that a request for “notes” went beyond simple paper documents or emails or that “documents” might include text messages. Maupin also testified that he did not search his cell phone for discoverable information because he was told the device would be produced for an inevitable forensic examination. Harrod and Feagin testified that they were confused by the
Even then, Defendants still produced over 76,000 pages of documents to Weather King and agreed to a forensic examination of their devices. Defendants have served Weather King with discovery responses and supplemented them four to five times. Defendants also justify their opposition to Weather King‘s attempts to subpoena non-parties. Defendants raised jurisdictional arguments against the subpoenas and their contention that the third parties had no relevant dealings with American Barn as good faith grounds to quash the subpoenas. Maupin also testified that he received legal advice from attorney Douglas Hines and that he directed Hines to draft a letter on behalf of the recipients of the subpoenas, stating their objections to Weather King‘s requests.
Defendants further argue that Weather King has not shown why sanctions are warranted against all Defendants. Weather King seeks to sanction Defendants collectively without an individualized assessment of each Defendant‘s conduct. For example, Harrod experienced serious health issues and was hospitalized at more than one point during the discovery phase of the case. Harrod‘s condition impacted his ability to understand his discovery obligations and comply with Weather King‘s requests. And Weather King filed its request for sanctions before it had even deposed all of the individual Defendants. As of the time when Plaintiff moved for sanctions, Weather King had not yet deposed Hershberger, Gillespie, or Brown. Weather King‘s request for significant sanctions fails to show why they are warranted based on this record.
STANDARD OF REVIEW
Plaintiff seeks sanctions against Defendants pursuant to
The Federal Rules of Civil Procedure grant the Court similar authority to impose appropriate sanctions, including entry of default judgment, for a party‘s violations of its disclosure and discovery obligations under the rules. Universal Health Grp. v. Allstate Ins. Co., 703 F.3d 953, 956 (6th Cir. 2013);
Plaintiff seeks the sanction of default judgment. The Sixth Circuit has commented that “[j]udgment by default is a drastic step which should be resorted to only in the most extreme cases.” Prime Rate Premium Fin. Corp., Inc. v. Larson, 930 F.3d 759, 769 (6th Cir. 2019) (quoting United Coin Meter Co. v. Seaboard Coastline R.R., 705 F.2d 839, 845 (6th Cir. 1983)). Even so, it is not an abuse of discretion for a district court to enter default judgment where a “party has the ability to comply with a discovery order and does not.” Hampton v. Madison Cnty., Tenn., No. 21-5553, 2022 WL 17438317, at *2 (6th Cir. Nov. 7, 2022) (quoting Bank One of Cleveland, N.A. v. Abbe, 916 F.2d 1067, 1073 (6th Cir. 1990)). In the final analysis, “[e]ntry of a default judgment against a party for failure to cooperate in discovery is a sanction of last resort, and may not be imposed unless noncompliance was due to
ANALYSIS
The issue presented is whether the sanction of default judgment is justified against Defendants for their failure to produce complete discovery responses. The Court holds that default judgment is warranted, though only against some Defendants and only pursuant to
Likewise, the Court finds that Plaintiff has not carried it burden to show why the Court should sanction Defendants Stephanie L. Gillespie, Ryan E. Brown, or Daniel J. Hershberger.2 Of the 62 evidentiary exhibits Plaintiff has attached to its Motion for Sanctions, only three directly implicate the discovery conduct of Gillespie, Brown, or Hershberger: Plaintiff has cited each Defendant‘s written discovery responses (ECF Nos. 186-5, 186-6, and 186-7) to Weather King‘s written discovery requests. Although Plaintiff‘s reply argues that nine other exhibits implicate the discovery failures of Gillespie, Brown, and Hershberger, the majority of the exhibits cited, mainly text messages, do not mention or (at least on the surface) implicate these three Defendants.
In fact, only two refer to “Stephanie Parker,” an exchange of text messages (ECF No. 187-10) between Maupin and Stephanie Parker (presumably now Stephanie Gillespie) from June 4, 2022, in which Parker worried about going to jail; and a second chain of text messages between Maupin and Parker from March 1, 2022 (ECF No. 191), in which Maupin and Parker discussed various software and data sets they would need and the importance of using their personal email to communicate about them. Two more involve text messages between Maupin and Ryan Brown: a chain of text messages (ECF No. 189-6) from April 11, 2022, when Maupin and Brown discussed
The Court finds that based on this record, Weather King has not shown that Gillespie, Brown, or Hershberger acted in bad faith when they omitted these communications from their discovery responses. As of the filing of the Motion for Sanctions, Plaintiff had not deposed these parties. Plaintiff has shown that the evidence cited should have been produced with Defendants’ discovery responses and that there is at least a possibility of concerted action on the part of some Defendants to thwart Plaintiff‘s attempts to recover text messages, emails, and other evidence stored on Defendants’ devices. Still, the Court has no proof to explain the context of the specific communications cited by Plaintiff as the basis for sanctions or any testimony from these Defendants about why they omitted them from their production of discoverable information. Therefore, the Motion for Sanctions is DENIED as to Gillespie, Brown, and Hershberger but without prejudice to renew the request for sanctions with a more complete showing to demonstrate why default judgment is warranted as to each Defendant.
One other preliminary matter merits discussion before the Court turns to the issues presented as to the remaining Defendants. Weather King cites as grounds for default judgment
Weather King has not shown that it can meet the requirements for default judgment under
I. Defendants’ Bad Faith
Having narrowed the issues for determination, the Court now focuses on whether sanctions are proper against the remaining Defendants: Jesse Maupin, Barry Harrell, Adrian Harrod, Logan
Here, the Court finds that Defendants failed to cooperate in discovery and that their failure was willful and in bad faith, largely because Defendants’ after-the-fact explanations are not credible. Defendants were clearly on notice of their duty to preserve evidence at all times since June 12, 2022.3 The essential facts regarding Defendants’ discovery failures are undisputed. Start with Plaintiff‘s litigation hold and preservation letter from June 2022. The record shows that Plaintiff issued the letter to each Defendant directing them individually to “preserve and retain all documents that are potentially relevant” to litigation. Cease and Desist Ltr., June 12, 2022 (ECF
Defendants have offered a variety of explanations for their omissions, none of which the Court finds credible. On the contrary, Defendants’ roving rationalizations and claimed confusion about their responsibilities ring hollow and only reinforce the conclusion that they did not have a good faith basis for their conduct. For example, Maupin testified that his duties to preserve and disclose were unclear because he did not understand Weather King‘s requests for “documents” and “communications” to mean texts, emails, or electronically stored information. Weather King‘s discovery requests specifically defined the terms for Maupin, precisely to avoid any confusion or
The Court finds that the manner in which Weather King used the terms “documents” and “communications” could not have been much clearer. Weather King specifically wanted text messages, emails, and anything else stored electronically. Furthermore, when Weather King moved for an order compelling Defendants to supplement their discovery responses (ECF No. 75), Defendants filed a lengthy brief opposing the motion. At no point, however, did Defendants argue that Weather King‘s requests were overbroad, vague, or otherwise unclear to them. In fact, the briefing on the motion to compel makes multiple references to text messages and emails sought by Weather King. Even if Maupin was unsure about what was required, the Magistrate Judge cleared things up in his order on Weather King‘s motion to compel the supplemental responses and the forensic examination. There, the Magistrate Judge described Defendants’ discovery responses up to that time as “lacking” and cautioned them about the seriousness of meeting their discovery obligations. Mag. J.‘s Order 4, 11, Aug. 29, 2023 (ECF No. 111). Maupin‘s post hoc rationale does not hold up to scrutiny.
The Court finds the other explanations offered by Defendants’ even less plausible. Feagin and Harrod testified that they were confused about their discovery obligations due to a letter counsel for Weather King addressed to different vendors after Weather King filed suit.4 The letter
Feagin and Harrod referred to was correspondence dated November 16, 2022, and addressed to certain vendors who are not parties to this case. Weather King has attached the letter addressed to American Outdoors of Alamogordo, New Mexico, as an exhibit (ECF No. 205-2) to its Motion for Sanctions. The letter began by explaining that Weather King had learned third parties were submitting building permit applications with Weather King‘s plans or drawings and “listing Weather King as the contractor.” Am. Outdoors Ltr. 1, Nov. 16, 2022 (ECF No. 205-2). Weather King also stated in the letter that based on information received from Maupin in the litigation, “American Barn‘s dealers all possess drawings previously belonging to Weather King,” and “at times those dealers affix Mr. Maupin‘s signature to permit applications.” Id. Under the circumstances, Weather King demanded that American Outdoors cease and desist using Weather King‘s drawings, plans, or blueprints and return “all Weather King drawings/plans/blueprints or any other Weather King property in your possession” and confirm “that any electronically-stored copies of such Weather King property have been destroyed.” Id. at 2.
Other than the testimony of Feagins and Harrod and their interpretation of the letter, Defendants have not shown how Weather King‘s November 2022 letters somehow left them unclear about their discovery obligations. First, the cease-and-desist letters were not addressed to any Defendant in this case. Defendants assert that the recipients of the letters shared copies with certain Defendants. Be that as it may, the letter does not direct any Defendant to take any action in response. The letter had nothing to say about what steps Defendants were asked to take, because the letter was not addressed to Defendants at all. Second, the letter‘s directive to destroy
Defendants fall back then to argue that the responses they did provide and their supplements to those responses show they have participated in discovery in good faith. But this argument misses the point. The question is not whether Defendants may have produced relevant evidence in the course of discovery. For the record, they have, both in responding to written discovery, in producing documents and information, and in sitting for depositions. Rather the issue is whether Defendants complied with the Magistrate Judge‘s order by producing all of the information to which Weather King was entitled.
For the reasons the Court has already discussed, Defendants did not comply with the Magistrate Judge‘s order and have not shown that they were somehow prevented from acting in accordance with the order. The Magistrate Judge entered his order on August 29, 2023. Over 18 months later and after receiving the results of the forensic examination of Defendants’ devices, it was clear Defendants had not supplemented their discovery as ordered, and Plaintiff was forced to seek relief once again from the Court. At this late stage of the case, all of Defendants’ explanations for their failure to comply do not hold up upon closer examination. The Court can only conclude that Defendants’ refusal to produce all of the relevant information in their possession was due to willfulness and fault.
What is more, Defendants’ failure to produce all of the relevant discovery it owed Weather King did not occur in a vacuum. Weather King has also shown that the discovery responses Defendants did provide were incomplete, at best, and in many respects inaccurate or misleading. According to a chart compiled by Weather King (ECF No. 191-7), there were 24 instances in which Defendants Maupin, American Barn, Harrell, Feagin, and Harrod‘s written discovery responses were inaccurate or incomplete. For example, Maupin answered Weather King‘s third interrogatory and stated that all communications related to the creation, funding, or operation of American Barn were “in person.” In fact, Weather King identified eight different text messages and emails to which Maupin was a party and where Maupin discussed these topics with others. Even more troubling, Weather King has demonstrated that when questioned about the inconsistencies between their discovery responses and other evidence revealed in discovery, Defendants admitted in their depositions that their discovery responses were inaccurate.
Under all of the circumstances, the Court finds that Defendants have acted in bad faith and with reckless disregard for the consequences of their actions, by refusing to comply with the Magistrate Judge‘s order, by failing to respond fully and completely to Weather King‘s discovery requests, and otherwise by ignoring their discovery obligations. Therefore, this first and most important factor weighs strongly in favor of the sanction of default judgment.
II. Prejudice to Weather King
III. Prior Warning About Possible Default Judgment
The third factor, whether the Court warned Defendants that their failure to cooperate could lead to a default judgment, is also satisfied here. “For starters, a court need not give any warning where, as here, the sanctioned party acted in bad faith.” Larson, 930 F.3d at 769 (citing Mager, 924 F.3d at 840). The Court has determined that Defendants acted in bad faith in failing to comply with the Magistrate Judge‘s August 2023 order and for the overall abuse of the discovery process. Even so, in the same order, the Magistrate Judge specifically gave Defendants the following admonition: “Any further obfuscation on Defendants’ part may result in sanctions, which could include judgment entered in Plaintiff‘s favor and/or a [contempt] finding. . . .” Mag. J.‘s Order
IV. Lesser Sanctions Will Not Suffice
The final factor, the advisability of a lesser sanction, also weighs in favor of default judgment. Stooksbury, 528 F. App‘x at 553. The Court has not previously sanctioned Defendants for their discovery-related conduct. The Magistrate Judge specifically denied Weather King‘s request for an award of expenses and attorney‘s fees in his August 2023 discovery order. The Magistrate Judge reached his decision, in part, because he accepted Defendants’ explanations that they did not understand certain terms in Weather King‘s discovery requests or that “they may no longer possess some documents.” Mag. J.‘s Order 13, Aug. 29, 2013. The Magistrate Judge nevertheless put Defendants on notice of the possibility of a default judgment. Having received the benefit of the doubt, Defendants still did not fully comply with the Magistrate Judge‘s order to supplement their discovery responses. Defendants not only failed to avail themselves of their second chance to supplement their written discovery responses, Defendants continued to play fast and loose with their discovery obligations by destroying evidence and attempting to interfere with Weather King‘s third party subpoenas. So even though the Magistrate Judge did not grant Weather King‘s request for sanctions in 2023, Defendants borrowed extra time, put Weather King to the expense of a forensic examination, meddled with third party discovery, and only finally admitted their conduct in their depositions. On this record, the Court finds that a lesser sanction would not capture the seriousness and extent of Defendants’ abuse of the discovery process. Roadway Exp., Inc. v. Piper, 447 U.S. 752, 763–64 (1980) (“Rule 37 sanctions must be applied diligently both to
In addition to the discretion to “issue further just orders” by imposing any of the sanctions listed in
The full extent of Weather King‘s expense and attorney‘s fees is not entirely clear from the record. Weather King has included documentation to support their request for expenses and attorney‘s fees, some of which, particularly counsel‘s billing invoices, is heavily redacted. See
CONCLUSION
The Court holds that Weather King is entitled to the sanction of default judgment against Defendants Jesse Maupin, Barry Harrell, Adrian Harrod, Logan Feagin, and American Barn. Weather King is also entitled to an award of expenses and attorney‘s fees pursuant to
IT IS SO ORDERED.
s/ S. Thomas Anderson
S. THOMAS ANDERSON
UNITED STATES DISTRICT JUDGE
Date: June 30, 2025.