Major League Baseball Properties v. Corporacion de Television y Microonda Rafa

Background

MLB Properties petitioned to confirm an arbitration award against Corporación de Televisión y Microonda Rafa, S.A., also called Telemicro. In September 2020, the court entered judgment confirming the award for $6,012,463.97, plus post-judgment interest and certain attorneys’ fees.

After judgment, MLB Properties served Telemicro with subpoenas seeking information, documents, and testimony about Telemicro’s assets, including assets outside the United States and assets connected to Telemicro International Holding Corp. (TIHC). Telemicro objected to the requests and did not produce the required information and documents. Telemicro also failed to retain substitute counsel after its attorneys withdrew, failed to appear at a court-ordered conference, and failed to comply with later discovery orders.

The court previously ordered Telemicro, TIHC, and Mayerlin Rosario to produce all responsive documents and information and to appear for depositions. Telemicro did not timely produce the required discovery. Rosario appeared as TIHC’s corporate representative but testified that she was not prepared and that Maribeth Gomez would be better able to answer MLB Properties’ questions. TIHC later produced some documents but refused to produce Gomez, asserting that the request was premature.

Sanctions Against Telemicro

MLB Properties asked for sanctions under Rule 37 of the Federal Rules of Civil Procedure. Rule 37 permits a court to impose consequences when a party disobeys a discovery order, including preventing the party from offering evidence on specified matters.

The court found that Telemicro had willfully and repeatedly disregarded its discovery obligations and court orders over approximately a year and a half. The court also found that Telemicro had been repeatedly warned that noncompliance could result in sanctions. Because monetary sanctions would not likely be effective in collecting the judgment, the court concluded that an evidence-preclusion sanction was appropriate.

The court granted in part and denied in part MLB Properties’ motion for sanctions against Telemicro and its executives. The court denied the motion to the extent MLB Properties sought contempt findings or monetary penalties against Telemicro and the executives. The court granted the motion conditionally to the extent MLB Properties sought to prevent Telemicro from offering evidence about its assets or potential alter-ego or nominee relationships in opposition to MLB Properties’ post-judgment enforcement efforts.

The preclusion sanction would become final on September 15, 2022, only if Telemicro failed to produce all responsive documents by that date. The court described this as Telemicro’s final warning.

Additional TIHC Deposition and Expenses

The court granted MLB Properties’ request to compel TIHC to produce Maribeth Gomez for a deposition as TIHC’s corporate representative. The deposition must occur within 30 days of the order.

The court also ordered TIHC to pay MLB Properties’ reasonable expenses attributable to the additional deposition, including attorneys’ fees and time spent seeking and taking the deposition. Applying Rule 37, the court found that TIHC had not shown that its failure to comply with the earlier discovery order was substantially justified. MLB Properties was directed to submit documentation of those expenses within 30 days after the Gomez deposition.

Result

The sanctions motion against Telemicro and its executives was GRANTED in part and DENIED in part. The request to compel TIHC to produce Maribeth Gomez for an additional deposition was GRANTED, and TIHC was ordered to pay the related reasonable expenses.