DANIEL GROSKOP, аs Trustee of the Black Diamond Liquidating Litigation Trust, Appellant (Plaintiff), v. S&T BANK, Appellee (Defendant). S&T BANK, Appellant (Defendant), v. DANIEL GROSKOP, as Trustee of the Black Diamond Liquidating Litigation Trust, Appellee (Plaintiff).
S-19-0254, S-19-0255
THE SUPREME COURT, STATE OF WYOMING
August 26, 2020
2020 WY 113
The Honorable William J. Edelman, Judge
APRIL TERM, A.D. 2020; Appeal from the District Court of Johnson County
Tyler T. Dugger, Tolliver Law Firm, P.C., Billings, Montana.
Representing S&T Bank:
Patrick J. Murphy and Keith J. Dodson, Williams, Porter, Day & Neville, P.C., Casper, Wyoming.
NOTICE: This opinion is subject to formal revision before publication in Pacific Reporter Third. Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of any typographical or other formal errors so that correction may be made before final publication in the permanent volume.
GRAY, Justice.
[¶1] In 2010, Black Diamond Energy and Black Diamond Energy of Delaware (together, “the BDE Companies“), and seventeen limited partnerships (the “Limited Partnerships“), sued S&T Bank (“the Bank“). The Complaint alleged, among other things, that the Bank‘s lending policies in the wake of the 2008 economic recession caused severe finanсial loss to the Limited Partnerships managed by the BDE Companies. Following the resolution of various procedural issues, the Bank filed its Answer to Plaintiffs’ Complaint in 2012.1 In 2015, the Limited Partnerships formed a Liquidating Litigation Trust (“the Trust“) pursuant to the partnership agreement. The Trust appointed Daniel Groskop, a former financial manager for the BDE Companies, as Trustee. When we refer to Mr. Groskop in this opinion, it is in his capacity as Trustee. Mr. Groskop was substituted for the Limited Partnerships as the true party in interest in 2017, on the condition that any claims the BDE Companies had against the Bank were to be dismissed with prejudice. The BDE Companies had no further involvement in these proceedings.
[¶2] After Mr. Groskop‘s substitution and as the litigation progressed, discovery disputes arose. The Bank filed a motion to compel production, a motion for additional sanctions, and three motions to dismiss. The district court entered two orders compelling discovery to no avail. Then, Mr. Grоskop failed to prepare for the
ISSUE
[¶3] We consolidate and rephrase the parties’ issues into a single issue:2
Did the district court abuse its discretion when it dismissed the case with prejudice?
FACTS
A. Background
[¶4] The BDE Companies were the general managing partners for seventeen Limited Partnerships. Collectively, the Limited Partnerships represented approximately 3800 members (the “Limited Partners“). In 2002, the Bank began lending money to the BDE Companies through a line of credit. The original loan agreement underwent numerous amendments, primarily increasing the line of credit and extending the maturity date of the loan. In early 2008, the BDE Companies requested another increase to the line of credit—raising the BDE Companies’ dеbt to nearly $30 million—and another extension of
[¶5] The BDE Companies chose Morris Anderson and Associates, and Morris Anderson provided a chief restructuring officer. Morris Anderson worked with the BDE Companies for approximately two months. Efforts to salvage the BDE Companies were unsuccessful, and they defaulted on their loan in 2009.
B. Relevant Procedural History
[¶6] The BDE Companies and Limited Partnerships sued the Bank in August 2010, alleging that the Bank‘s “domination and control” of the BDE Companies caused financial loss to the Limited Partners. They allegеd that under the control agreements, the Bank mishandled company assets. They also claimed that Morris Anderson, as a de facto agent of the Bank, mismanaged the restructuring efforts.
[¶7] In 2015, the Limited Partnerships created a Liquidating Litigation Trust.3 The Trust was to provide a vehicle for any distributions of assets owed the Limited Partners, including any favorable judgment rendered in this lawsuit.4 Mr. Groskop, a former employee in the BDE Companies’ accounting department, was named Trustee and substituted as Plaintiff in place of the Limited Partnerships. The Limited Partnerships and Mr. Groskop certified that Mr. Groskop was able to represent the Limited Partners’ interests. The district court dismissed the BDE Companies’ claims with prejudice. Mr. Groskop filed a First Amended Complaint in May 2017, broadly incorporating the same allegations made in the original Complaint.
C. The Bank‘s January 2019 Motion to Compel
[¶8] From the outset there were discovery disputes. These disputes culminated in 2019 when in January, the Bank filed a motion to compel disсovery. The motion alleged that, despite numerous “meet and confer” letters to Mr. Groskop, he failed to produce crucial documents and information directly related to the allegations in the First Amended Complaint. The Bank claimed that Mr. Groskop violated
[¶9] The Bank charged that Mr. Groskop did not comply with his
[¶10] The Bank asserted that Mr. Groskop failed to comply with his
[¶11] The Bank alleged Mr. Groskop failed to produce other key documents. Specifically, in 2011, the original plaintiffs had subpoenaed Morris Anderson seeking information and documents related to restructuring efforts. Morris Anderson, in response to the subpoena, had provided relevant documents to original counsel for the BDE Companies and the Limited Partnerships.8 The Bank requested discovery of these documents from Mr. Groskop in March 2016, but, by January 2019, they had not been produced. Mr. Groskop claimed that he had already provided these documents through an electronic database. The Bank denied that the documents were included in that database and asserted that its efforts to obtain them by other means had been unsuccessful. It contended that the Limited Partnerships’ claim that they were damaged by the Bank‘s control of Morris Anderson made discovery of these documents crucial.
[¶12] Mr. Groskop produced more than 100 banker boxes of unorganized and irrelevant documents forcing the Bank to look for the proverbial “needle in a haystack.” In addition, he produced a large, unorganized online database forcing the Bank to sort through a copious amount of electronic information without guidance. The Bank asserted Mr. Groskop‘s failure to provide documents as they were kept in the usual course of business violated
[¶13] Finally, the Bank took issue with Mr. Groskop‘s privilege log. It argued numerous documents listed as privileged were discoverable. It requested the production of these documents or, in the alternative, that the court conduct an in camera review to determine which documents should be produced.
D. The District Court‘s March 2019 Order Compelling Discovery
[¶14] At the March 13, 2019 hearing, the district court orally granted the Bank‘s motion to compel and ordered Mr. Groskop to comply by April 1, 2019. The district court memorialized this ruling in an Order Compelling Discovery dated March 28, 2019. It directed Mr. Groskop to personally provide verified answers to the Bank‘s first and second sets of interrogatories. It required Mr. Groskop to respond to the Bank‘s requests for production and to submit documents listed in his privilege log for an in camera review. On June 3, 2019, it entered an Order
E. The Bank‘s Motion for Additional Sanctions
[¶15] Mr. Groskop filed supplemental responses to discovery by the April 1 cutoff. The Bank filed a Motion for Additional Sanctions on April 18, 2019. It argued that Mr. Groskop did not adhere to the court‘s order and that Mr. Groskop had control “over significantly more documents than what he ha[d] produсed.”10 In essence, he had simply “doubled down on [his] previous position that he ha[d] already complied with his discovery obligations.” Mr. Groskop again failed to produce any documents related to the BDE Companies or Limited Partnerships, particularly financial statements and internal communications documenting the collapse of the BDE Companies. Mr. Groskop refused to produce the Morris Anderson documents and raised a new argument—he was not required to produce them because he had not been substituted as the true party in interest at the time the Morris Anderson subpoena was issued. The Bank insisted that dismissal of the case was the only appropriate remedy given Mr. Groskop‘s deficient response and a fast-approaching mid-September trial date.
F. The District Court‘s Order on Defendant‘s Motion for Additional Sanctions
[¶16] The district court granted the Bank‘s motion for additional sanctions. It found that despite having “amрle time and opportunity to respond to several discovery requests,” Mr. Groskop did not do so even after the court entered its Order Compelling Discovery. It found that Mr. Groskop failed to adequately respond to requests seeking documents related to payments to the Limited Partners and minutes and memorandums regarding loans and additional loans. Against Mr. Groskop‘s assertions, the district court found he had access to “all information, documents, and other relevant evidence provided to his predecessor in interest, the Limited Partners.” When Mr. Groskop was substituted as the true party in interest, he “stepped [into] the shoes of the Limited Partners that were the original Plaintiffs[] in this matter.” It found Mr. Groskop‘s argument that he was not required to provide the Morris Anderson subpoena responses because he did not personally issue the subpoena “an absolutely preposterous proposition.” The district court reasoned that “all dоcuments and/or information provided to the Limited Partners as a result of their subpoenas is unequivocally considered to have been provided to [Mr.] Groskop as well.” Regarding information related to the BDE Companies, the district court found “Plaintiff has the practical ability to obtain such information/documents from [the BDE Companies] based on Plaintiff‘s relationship with [the BDE Companies].”
[¶17] The court again ordered Mr. Groskop to comply with all outstanding discovery requests and orders.11 It warned him that failure to “obey the [c]ourt‘s orders as directed . . . will unquestionably result in further sanctions, which may include the dismissal of separate causes of action, the dismissal of this case in its entirety, and/or adverse jury instructions.” The court directed the Bank to submit another affidavit of attorneys’ fees and costs, which it awarded in a separate order dated June 27, 2019.
[¶18] After conducting an in camera review of Mr. Groskop‘s privilege log, the district court issued a subsequent order. It found the privilege log contained blanket claims of privilege, but “the vast majority of the documents [were] nowhere near the
G. The Final Straw—Mr. Groskop‘s Rule 30(b)(6) Deposition
[¶19] After the Bank filed for additional sanctions, it deposed Mr. Groskop in his capacity as the designated
H. The Bank‘s Second and Third Motions to Dismiss
[¶20] After Mr. Groskop‘s 30(b)(6) deposition, the Bank filed a Second Motion to Dismiss Plaintiff‘s First Amended Complaint Due to Plaintiff‘s Failure to Prepare for His
[¶21] In his response to the Third Motion to Dismiss, Mr. Groskop admitted that “failures occurred” during discovery. He characterized each shortcoming as an “honest mistake.” He complained the Bank “has not fairly represented . . . the facts” related to the discovery disputes and that it had contrived its motion to dismiss “based on partial truths” and “[w]illful [u]ntruths.” He described the Bank‘s argument related to signing the interrogatories as a “[d]iscovery [t]rap” and insisted “the [c]ourt‘s order was followed[.]” He claimed the “Bank had access to . . . voluminous documents” and “not a single aspect of this discovery dispute focuses on . . . documents which support [Mr. Groskop‘s] claims against the [B]ank.” Mr. Groskop raised yet another new argument on the Morris Anderson subpoena. He claimed responsive documents had never been produced to the BDE Companies or Limited Partnerships due to actions by the Bank, and that the documents simply did not exist. Although he acknowledged that “under Wyoming‘s version of 30(b)(6)” he designated himself as the proper deponent, he claimed:
The actual knowledge of the facts rests with the lawyers representing the Trust
who have studied hundreds of documents and interviewed and deposed witnesses. . . .
No ethical lawyer would attempt to impart his knowledge of facts to a witness, even a 30(b)(6) fact witness. Only the lawyers for the Trust could provide the information sought by the 30(b)(6) notice. They could not under ethical rules, teach this information to the Trustee to provide it during his deposition.
I. The District Court‘s Order of Dismissal
[¶22] After a hearing, the district court entered an Order Granting Defendant‘s Second Motion to Dismiss Plaintiff‘s First Amended Complaint Due to Plaintiff‘s Failure to Prepare for His
[¶23] The district court determined that Mr. Groskop‘s failure to prepare for his 30(b)(6) deposition was a “direct” and “willful” violation of the Wyoming Rules of Civil Procedure that amounted to a failure to appear. The court found that Mr. Groskop “was obligated to respond to [the interrogatory responses] under oath, and to sign something under oath that one has not read is akin to lying under oath.” The court found that Mr. Groskop failed to produce documents as ordered. It concluded his excuses were pretexts and contrary to the rules of civil procedure and the law.
[¶24] The district court declared it had given Mr. Groskop ample warning that continued noncompliance with its orders “undoubtedly” would result in additional sanctions, including the possibility of dismissal. The court characterized Mr. Groskop‘s behavior as demonstrating a “pattern of deceit and blatant disregard” for the Wyoming Rules of Civil Procedure and “an astonishing indifference to the [c]ourt‘s orders” reaching a “level of hubris rarely displayed in open court.” Given the significant prejudice to the Bank, willful noncompliance, and the imminent trial date, the district court concluded that dismissal of the case was the only appropriate remedy.
DISCUSSION
Did the district court abuse its discretion when it dismissed the case with prejudice?
A. Standard of Review
[¶25] We review a district court‘s rulings on discovery, including the issuance of sanctions, for an abuse of discretion. Herrick v. Jackson Hole Airport Bd., 2019 WY 118, ¶ 11, 452 P.3d 1276, 1280 (Wyo. 2019). “A court abuses its discretion when it acts in a manner which exceeds the bounds of reason under the circumstances.” McBride-Kramer v. Kramer, 2019 WY 10, ¶ 11, 433 P.3d 529, 532 (Wyo. 2019) (quoting Three Way, Inc. v. Burton Enters., Inc., 2008 WY 18, ¶ 16, 177 P.3d 219, 225 (Wyo. 2008)). The appellant carries the burden of proof to demonstrate an abuse of discretion, and the ultimate issue is whether the court could have reasonably concluded as it did. Id.
[¶26] “A district court is generally afforded broad discretion, both in the mechanisms adopted to сontrol discovery and in its selection of appropriate sanctions for violations of discovery.” Black Diamond Energy, Inc. v. Encana Oil & Gas (USA) Inc., 2014 WY 64, ¶ 43, 326 P.3d 904, 915 (Wyo. 2014) (citing Roemmich v. Roemmich, 2010 WY 115, ¶ 22, 238 P.3d 89, 95 (Wyo. 2010)); see also Windham v. Windham, 2015 WY 61, ¶ 16, 348 P.3d 836, 841 (Wyo. 2015). When a district court imposes sanctions following discovery violations, “[w]e apply a de novo standard of review to the question whether the district court correctly interpreted
[¶27] Mr. Groskop claims the district court erred in granting the Bank‘s motion to dismiss. First, he claims he “arguably” did not violate the district court‘s discovery orders. Second, he claims a dismissal with prejudice is unwarranted because he did not act willfully; his alleged discovery violations were not extreme; and every violation remained curable. We reject Mr. Groskop‘s arguments.
1. Mr. Groskop violated the district court‘s orders and the Wyoming Rules of Civil Procedure.
[¶28] In its Order of Dismissal,14 the district court found that Mr. Groskop violated its previous orders when he (1) failed to proрerly verify interrogatories; (2) failed to produce responsive documents; and (3) did not pay attorneys’ fees. It determined Mr. Groskop violated
a. W.R.C.P. 33
[¶29] The district court did not err in finding Mr. Groskop had failed to properly verify the Bank‘s interrogatories in contravention of its March 2019 Order Compelling Discovery.16 Wyoming Rule of Civil Procedure 33(b) states:
(1) Responding Party. — The interrogatories must be answered:
(A) by the party to whom they are directed; or
(B) if that party is a public or private corporation, a partnership, an association, or a governmental agency, by any officer or agent, who must furnish the information available to the party.
. . .
(3) Answering Each Interrogatory. — Each interrogatory must, to the extent it is not objected to, be answered separately and fully in writing under oath.
. . . (5) Signature. — The person who makes the answers must sign them, and the attorney who objects must sign any objections.
[¶30] A “[v]erification” is “a declaration that a statement is true made by a person upon oath or affirmation.”
[¶31] Mr. Groskop‘s signed “Verification” stated:
Dan Groskop, being first duly sworn upon oath, deposes and states as follows:
I am the Plaintiff in the above-entitled action and have read these discovery requests and the answers are true to the best of my knowledge, information and belief, as far as such discovery requests are directed to my own personal knowledge.
Mr. Groskop swore under oath that he had read the interrogatories. He later admitted that he had not read them. Consequently, he could not know whether the answers were true or not.18
By signing, an attorney or party certifies the response [is true] to the best of the person‘s knowledge, information, and belief formed after a reasonable inquiry. Even pro se parties are required to comply with the rule providing for verification of interrogatory responses. The verification requirement serves the critical purpose of ensuring that the responding party attests to the truth of the responses.
23 Am. Jur. 2d Depositions and Discovery § 129, at 473 (2013); Villareal v. El Chile, Inc., 266 F.R.D. 207, 211 (N.D. Ill. 2010) (“Requiring a party to sign interrogatory responses under oath serves the critical purpose of ensuring that the responding party attests to the truth of the responses.“). Mr. Groskop submitted a false statement under oath. The district court did not err in finding that Mr. Groskop‘s false oath violated its March 2019 Order Compelling Discovery.
b. W.R.C.P. 34
[¶32] The district court did not err when it found Mr. Groskop failed to
[¶33] Mr. Groskop contends that he “arguably” complied with the court‘s orders for production. In his brief on appeal, he claims his fаilure to produce “a certain category of documents” was due to a clerical error. According to Mr. Groskop, this “category of documents” had been misfiled. He claims he produced them immediately upon finding them. His brief does not state when these documents were produced, nor does he cite to the record. Some clarity is provided in the Bank‘s response brief. Apparently, Mr. Groskop‘s counsel provided over 1000 pages on a USB file on June 28, 2019. In a contemporaneous letter to the district court and the Bank‘s counsel, Mr. Groskop admitted he had received these documents in 2016. The files contained communications between the BDE Companies and the Limited Partnerships regarding the economic challenges the companies faced at the time of their collapse. Mr. Groskop submits this production shows he did not completely ignore the district court‘s orders, although he concedes the late production of these documents “might have created damage that could not be totally cured.”
[¶34] Mr. Groskop‘s late production of some documents does not alter his failure to comply with the district court‘s orders. Significantly, Mr. Groskop does not claim he produced the financial documents referenced in the Order of Dismissal. The district court‘s Order of Dismissal stated:
[T]o date [Mr. Groskop has] not produced any [financial] documents, including but not limited to, the [K-1] schedules for the [Limited Partnerships] or any loss/profit statements. . . . [Mr. Groskop‘s] failure to produce any financial records or documents means [he] has failed to identify any evidence in support of the alleged damages with any particularity. This will severely prejudice [the Bank‘s] ability to defend the case on its [merits].
Mr. Groskop‘s late production of some documents was too little, too late. See Cine Forty-Second St. Theatre Corp. v. Allied Artists Pictures Corp., 602 F.2d 1062, 1068 (2d Cir. 1979) (“Under the deterrence principle of National Hockey [Nat‘l Hockey League v. Metro. Hockey Club, Inc., 427 U.S. 639, 96 S.Ct. 2778, 49 L.Ed.2d 747 (1976)], plaintiff‘s . . . belated compliance should not be accorded great weight. Any other conclusion would encourage dilatory tactics, and compliance with discovery orders would come only when the backs of counsel and the litigants were against the wall.“).
[¶35] The Bank submitted evidence that the yet unproduced documents were in the possession or control of Mr. Groskop. The district court found Mr. Groskop was able to produce them. He did not. The record contains adequate, substantial, and credible evidence to sustain the trial court‘s factual findings, and we will not disturb them. See Ohio Cas. Ins. Co. v. W.N. McMurry Const. Co., 2010 WY 57, ¶ 14, 230 P.3d 312, 320 (Wyo. 2010). The district court did not err. Mr. Groskop willfully withheld documents despite two orders compelling production.
c. W.R.C.P. 30(b)(6)
[¶36] Mr. Groskop does not contest that he violated Rule 30(b)(6). Instead, he claims his conduct was not willful and therefore dismissal with prejudice was not justified. Rule 30(b)(6) provides:
Notice or Subpoena Directed to an Organization. — In its notice or subpoena, a party may name as the deponent a public or рrivate corporation, a partnership, an association, a governmental agency, or other entity and must describe with reasonable particularity the matters for examination. The named organization must then designate one or more officers, directors, or managing agents, or designate other persons who consent to testify on its behalf; and it may set out the matters on which each person designated will testify. A subpoena must advise a nonparty organization of its duty to make this designation. The persons designated must testify about information known or reasonably available to the organization. This paragraph (6) does not preclude a deposition by any other procedure allowed by these rules.
[¶37] “Rule 30(b)(6) allows a party to depose a corporation through representatives designated by the corporation; the designee‘s testimony is then generally admissible as a statement of the corporation.” Banks v. Office of the Senate Sergeant-At-Arms, 241 F.R.D. 370, 372 (D.D.C. 2007).
A primary purpose[] of the Rule 30(b)(6) deposition is to “curb the ‘bandying’ by which officers or managing agents of a corporation are deposed in turn but each disclaims knowledge of the facts that are clearly known to the organization and thereby to it.”
Fed.R.Civ.P. 30(b)(6) advisory committee notes. Once a requesting party describes with reasonable particularity the matters on which examination is requested, a series of duties fall on the responding corporation. First, the responding party must designate a deponent knowledgeable on the topic. Second, the responding party must designate multiple deponents if more than one is necessary to respond to all designated topics. Finally, the responding corporation must prepare the deponent so that he or she can testify on matters both within his or her personal knowledge as well as those “reasonably known by the responding entity.”
Id. at 372-73 (internal citations omitted).
[¶38] The lаnguage of the rule is not permissive, and states that a designated representative must testify about information known or reasonably available to the organization.
[¶39] Mr. Groskop failed to prepare for the Rule 30(b)(6) deposition after designating himself as the 30(b)(6) deponent. See supra ¶ 19. “Producing an unprepared witness is tantamount to a failure to appear” at a deposition. United States v. Taylor, 166 F.R.D. 356, 363 (M.D.N.C. 1996), aff‘d, 166 F.R.D. 367 (M.D.N.C. 1996). Mr. Groskop‘s lack of preparation prevented the Bank from inquiring about basic information, including the amount, type, and basis for the Limited Partners’ allеged damages. The district court found Mr. Groskop was “utterly and completely unprepared” and the deposition transcript confirms this finding. See supra ¶ 19.
[¶40] The district court did not err when it found Mr. Groskop had failed to comply with Rule 30(b)(6). Taylor, 166 F.R.D. at 363.
2. The district court did not abuse its discretion by dismissing the case with prejudice.
[¶41] We turn next to the question of whether the district court abused its discretion
[¶42] A district court is afforded wide latitude in interpreting Rule 37 and may tailor sanctions to the seriousness of the violation. Encana, ¶ 43, 326 P.3d at 915 (citing Roemmich, ¶ 22, 238 P.3d at 95).
(i) direсting that the matters embraced in the order or other designated facts be taken as established for purposes of the action, as the prevailing party claims;
(ii) prohibiting the disobedient party from supporting or opposing designated claims or defenses, or from introducing designated matters in evidence;
(iii) striking pleadings in whole or in part;
(iv) staying further proceedings until the order is obeyed;
(v) dismissing the action or proceeding in whole or in part;
(vi) rendering a default judgment against the disobedient party; or
(vii) treating as contempt of court the failure to obey any order except an order to submit to a physical or mental examination.
[¶43] In White, we explained:
If a party fails to comply with a court‘s discovery order, the court has broad discretion to issue further orders and to impose such sanctions “as are just.”
W.R.C.P. 37(b)(2) [2008]. Among the sanctions specifically mentioned in the rule is “dismissing the action or proceeding or any part thereof, or rendering a judgment by default against the disobedient party.”W.R.C.P. 37(b)(2)(C) [2008]. “Rule 37 clearly authorizes the court to dismiss pleadings as well as grant default judgment against the disobedient party.” Global Shipping [& Trading, Ltd. v. Verkhnesaldincky Metallurgic Co.], 892 P.2d [143,] 146 [(Wyo. 1995)].
White v. State ex rel. Wyoming Dep‘t of Transp., 2009 WY 90, ¶ 12, 210 P.3d 1096, 1099 (Wyo. 2009). In White, the court entered an order compelling the plaintiffs to comply with discovery and pay sanctions after multiple discovery violations. Id. ¶ 8, 210 P.3d at 1098. It warned them that failure to follow its orders would result in dismissal. Id. ¶ 8, 210 P.3d at 1099. The plaintiffs failed to respond to discovery requests or pay attorneys’ fees as ordered. Id. ¶ 9, 210 P.3d at 1099. On appeal, this Court affirmed, emphasizing that dismissal is appropriate when a party fails to “comply with appropriate court orders.” Id. ¶ 15, 210 P.3d at 1100.
[¶44]
The court where the action is pending may, on motion, order sanctions if:
(i) a party or a party‘s officer, director, or managing agent — or a person designated under
Rule 30(b)(6) or31(a)(4) — fails, after being served with proper notice, to appear for that person‘s deposition; or(ii) a party, after being properly served with interrogatories under
Rule 33 or a request for inspection underRule 34 , fails to serve its answers, objections, or written response.. . .
(3) Types of Sanctions. — Sanctions may include any of the orders listed in
Rule 37(b)(2)(A)(i) –(vi) . . . .
[¶45] Contrary to Mr. Groskop‘s contention, the district сourt provided a thorough analysis supporting its decision to use the sanction of dismissal.20 First, the district court considered prejudice to the Bank caused by Mr. Groskop‘s refusal to turn over documents, properly verify interrogatories, and prepare for the Rule 30(b)(6) deposition. It found the Bank was severely disadvantaged and noted that Mr. Groskop had interfered with the judicial process by delaying discovery for years. Farrell v. Hursh Agency, Inc., 713 P.2d 1174, 1180 (Wyo. 1986) (finding entry of default appropriate sanction when plaintiffs refused to comply with a court order compelling production for over a year). Next, the district court considered Mr. Groskop‘s culpability and found his noncompliance was
willful. Waldrop v. Weaver, 702 P.2d 1291, 1293 (Wyo. 1985) (“As a general rule, willful noncompliance must be shown before the case will be dismissed.” (citing Oaks v. Rojcewicz, 409 P.2d 839, 844 (Alaska 1966))). Mr. Groskop argues that his shortcomings were not willful because he lacked experience in legal matters. However, he was not left to wend his way through a multimillion-dollar lawsuit without guidance—he was represented by counsel. Orosco v. Schabron, 9 P.3d 264, 268 (Wyo. 2000) (“[T]he attorney was responsible for the circumstances that resulted in the Order of Dismissal with Prejudice, but we also have ruled that parties are bound by the conduct of their agents under such circumstances.“).
[¶46] Finally, the district court considered Mr. Groskop‘s many foregone opportunities to comply with discovery. See White, ¶ 14, 210 P.3d at 1100; Glob. Shipping & Trading, Ltd. v. Verkhnesaldincky Metallurgic Co., 892 P.2d 143, 146 (Wyo. 1995) (stating that whether a sanction is “just” depends specifically on whether the court warned petitioners that continued noncompliance with discovery orders would result in sanctions). Despite these opportunities, Mr. Groskop refused to comply with two orders compelling discovery and two orders awarding attorney fees. See Lee v. Max Int‘l, LLC, 638 F.3d 1318, 1320–21 (10th Cir. 2011) (“the district court‘s considerable discretion in this arena easily embraces the right to dismiss
[¶47] The district court concluded dismissal was the only effective sanction. As then-Judge Gorsuch wrote in Lee:
We have said that district courts enjoy “very broad discretion to use sanctions where necessary to insure . . . that lawyers and parties . . . fulfill their high duty to insure the expeditious and sound management of the preparation of cases for trial.” In re Baker, 744 F.2d 1438, 1440 (10th Cir. 1984) (en banc); see also Patterson v. C.I.T. Corp., 352 F.2d 333, 336 (10th Cir. 1965). The Supreme Court has echoed this message, admonishing courts of appeals to beware the “natural tendency” of reviewing courts, far from the fray, to draw from fresh springs of patience and forgiveness, and instead to remember that it is the district court judge who must administer (and endure) the discovery process. See Nat‘l Hockey League v. Metropolitan Hockey Club, Inc., 427 U.S. 639, 642, 96 S.Ct. 2778, [2780,] 49 L.Ed.2d 747 (1976). Commеntators, too, have advised us to remember that “the district courts must have latitude to use severe sanctions for purposes of general deterrence.” See Charles Alan Wright, Arthur R. Miller, Mary Kay Kane & Richard L. Marcus, Federal Practice & Procedure § 2284, at 444.
[¶48] The district court did not abuse its discretion when it concluded that the violations of two court orders compelling discovery, two orders awarding attorneys’ fees, and the failure to fulfill the representative duties associated with
[¶49] Affirmed.
Notes
(Emphasis added.) There is no final judgment on the motions for summary judgment from which the Bank may appeal. See Metz v. Laramie Cty. Sch. Dist. No. 1, 2007 WY 166, ¶¶ 57–59, 173 P.3d 334, 349 (Wyo. 2007) (UnderAny motion, under
Rules 50(b) and(c)(2) ,52(b) ,59 and60(b) , not determined within 90 days after filing shall be deemed denied unless, within that period, the determination is continued by order of the court, which continuation may not exceed 60 days, at which time, if the motion has not been determined, it shall be deemed denied.
The Limited Partnership agreement also provided:[A]ny one of the following: (i) the expiration of the fixed term of the Partnership; (ii) the giving of notice to the Participants by the Managing General Partner of its election to terminate the affairs of the Partnership; (iii) the giving оf notice by the Participants to the Managing General Partner of their similar election through the affirmative vote of Participants whose Agreed Subscriptions equal a majority of the Partnership Subscription.
The BDE Companies issued a termination notice to the Limited Partners on May 9, 2014. In that notice, the BDE Companies stated:Upon the occurrence of a Final Terminating Event, the affairs of the Partnership shall be wound up and there shall be distributed to each of the parties its Distribution Interest in the remaining assets of the Partnership. . . . Any in-kind property distributions to the Participants shall be made to a liquidating trust or similar entity for the benefit of the Participants[.]
The liquidating/litigation trust described in . . . the Partnership Agreement is hereby created and ANY in-kind property distributions to the Participants will be made to this liquidating/litigation trust for the benefit of the Participants unless such Participant makes an in-kind distribution election, as . . . described below.
This Trust is executed in order to providе for the payment of the proceeds of any judgment and/or award granted to the Limited Partnership plaintiffs in that certain Wyoming state court action styled Black Diamond Energy Partners 2001-A Ltd., et al., v. S & T Bank, Case No S-11-0206, for the benefit of the limited partners who are the beneficiaries of the Trust.
In re Paternity of HLG, 2016 WY 35, ¶ 28, 368 P.3d 902, 909 (Wyo. 2016) (quoting Woodworker‘s Supply, 170 F.3d at 993).[T]he Tenth Circuit stated that district courts have broad discretion in determining whether discovery violations are substantially justified or harmless under the comparable federаl rule of civil procedure. It listed the following factors to guide the district court‘s discretion: “(1) the prejudice or surprise to the party against whom the testimony is offered; (2) the ability of the party to cure the prejudice; (3) the extent to which introducing such testimony would disrupt the trial; and (4) the moving party‘s bad faith or willfulness.”
In Ehrenhaus, the Tenth Circuit stated:
Ehrenhaus, 965 F.2d at 920–21 (some citations and internal quotation marks omitted). We decline to adopt either test here because neither is necessary to our holding.Before choosing dismissal as a just sanction, a court should ordinarily consider a number of factors, including: (1) the degree of actual prejudice to the defendant; (2) the amount of interference with the judicial process; . . . (3) the culpability of the litigant; (4) whether the court warned the party in advance that dismissal of the action would be a likely sanction for noncompliance; and (5) the efficacy of lesser sanctions. “Only when the aggravating factors outweigh the judicial system‘s strong predisposition to resolve cases on their merits is dismissal an appropriate sanction.” Meade [v. Grubbs], 841 F.2d [1512,] 152[0] n.7 [(10th Cir. 1988)] (citations omitted).