Handloser v. HCL America, Inc.

Background

Plaintiffs Gregory Handloser and Cerafin Castillo filed two motions seeking discovery sanctions against HCL America, Inc. and HCL Technologies, Ltd., which the opinion collectively calls HCL. The motions concerned HCL’s alleged failure to comply with a November 25, 2019 discovery order, HCL’s objections to document requests, and HCL’s handling of discovery-dispute communications.

The November 25 order required HCL to produce data concerning applicants, employees, and contractors in response to Requests for Production (RFPs) 1–3; organizational charts or other identifying information concerning specified HCL personnel in response to RFP 6; business plans and reports in response to RFP 5; 2014 EEO-1 reports and certain underlying data in response to RFP 9; and discrimination complaints and related materials in response to RFP 11.

HCL initially produced data responsive to RFPs 1–3 without the names of applicants and later reproduced the data. On March 20, 2020, HCL produced additional data sets, stating that its earlier production had inadvertently omitted responsive data. HCL also produced additional organizational charts and information concerning RFP 6, but the court found that HCL had not fully identified personnel who could not reasonably be identified from the charts.

HCL acknowledged that some productions were late or incomplete but argued that it had substantially complied and that the delays were substantially justified. The plaintiffs also challenged HCL’s use of general and boilerplate objections to document requests. HCL responded that its objections were warranted because some requests were overbroad. The plaintiffs further argued that HCL’s counsel delayed responding to discovery communications and used the court’s dispute-resolution procedures to delay bringing disputes to the court. HCL denied being generally uncooperative.

Court’s analysis

The court considered sanctions under Federal Rules of Civil Procedure 26(g) and 37(b). Rule 26(g) requires counsel to make a reasonable inquiry before signing discovery responses. Rule 37(b) permits sanctions for failing to obey a discovery order and generally requires payment of reasonable expenses caused by an unjustified failure to comply, unless an award would be unjust.

For RFPs 5, 9, and 11, the court found that HCL substantially complied with the November 25 order. Although some supplemental productions were late, they were limited and made within a few weeks of the deadlines. The court therefore denied sanctions on those grounds.

For RFPs 1–3, the court found that HCL did not substantially comply with the ordered deadlines. The court stated that complete and accurate data was important to the plaintiffs’ case analysis and that HCL had more than five months to investigate and prepare the production. The court found HCL’s delay was not substantially justified. The omission of applicant names, standing alone, would not have warranted sanctions because that problem appeared to have been promptly corrected, but other gaps were not corrected until more than ten weeks after the ordered deadlines.

For RFP 6, the court found that HCL had not fully complied with the requirement to provide organizational charts or otherwise identify specified personnel. The court rejected HCL’s apparent assumption that partial names or no information could satisfy the obligation to identify those people. It found that the failure was not substantially justified.

The court agreed that many of the plaintiffs’ document requests were unreasonably broad but held that this did not relieve HCL of its duties under Rule 34. The court found that, with some exceptions, HCL’s responses did not specifically state the grounds for objections or identify documents withheld because of those objections. However, because the court had already admonished HCL about this conduct, it found another admonishment or additional sanctions unnecessary.

The court also found that HCL’s counsel had not been reasonably responsive on the communications described in the first sanctions motion and appeared to have invoked the court’s standing-order requirements to delay submitting disputes. Nevertheless, the court concluded that the standing order did not precisely regulate the specific conduct described well enough to support Rule 37 sanctions. The court admonished HCL and its counsel to follow the order’s letter and spirit in good faith going forward.

Disposition and sanctions

The court granted the plaintiffs’ motions for sanctions with respect to HCL’s failure to comply with portions of the November 25, 2019 discovery order and denied the motions as to all other matters.

The court ordered HCL to identify in writing, by name and position, the senior managers for the Immigration, TAG, WPC, and HR departments during the discovery period, their direct reports, and executives above the senior managers in the reporting chain, to the extent those people could not reasonably be identified from organizational charts HCL had already produced. The deadline was September 4, 2020, unless the parties agreed to a different date.

The court also imposed monetary sanctions jointly against HCL and its counsel for the plaintiffs’ fees and costs incurred preparing the portions of the sanctions motions concerning RFPs 1–3 and RFP 6. The court estimated that the plaintiffs were entitled to reimbursement of no more than $20,000, but required the plaintiffs to submit an application with supporting information so the amount could be determined. HCL was permitted to respond. The court did not preclude HCL from relying on its March 20, 2020 data production and did not extend the plaintiffs’ deadlines on that basis because a previously granted extension had reduced the prejudice from the late production.