Rodo Inc. v. Guimaraes

Background

Rodo Inc. served non-party Exactcar, Inc. with a subpoena for documents and deposition testimony. The subpoena required compliance by January 18, 2023. Exactcar did not object, did not timely comply, and did not seek an extension by that deadline. After Rodo asked the court to compel compliance, Exactcar produced some documents and stated that it had no other responsive materials.

Rodo later narrowed its motion to the absence of relevant text-message communications. Rodo argued that Exactcar’s production was incomplete because it did not include messages to or from Exactcar’s chief executive, Kevin Azzouz. Azzouz submitted a sworn declaration stating that his phone had automatically deleted messages every 30 days for several years, including during the period covered by the subpoena. He did not state that he had disabled automatic deletion or tried to recover the deleted messages.

Spoliation Analysis

Spoliation means destroying, materially altering, or failing to preserve evidence for use in reasonably expected litigation. The court explained that a non-party ordinarily has no duty to preserve evidence for others, but such a duty can arise when the non-party is notified of the litigation and instructed to preserve particular evidence.

Here, Rodo’s October 25, 2022 cease-and-desist demand warned Exactcar to preserve potentially relevant evidence, including electronic communications on cell phones and other devices. Rodo served the subpoena on December 15, 2022. The court concluded that Exactcar had an obligation to preserve the text messages and that Azzouz’s conduct was negligent because he took no steps to preserve or recover them. The court also found that a sanction against Exactcar was appropriate.

Rulings

The court determined that a fine of at least $25,000 was not warranted at that point. Exactcar had eventually produced responsive documents in its possession, Rodo was no longer challenging that aspect of the production, and Rodo had obtained at least some communications because the defendants had produced text messages in their possession.

The court ordered Exactcar to pay Rodo’s reasonable attorneys’ fees incurred in connection with Rodo’s motion to compel Exactcar’s compliance with the subpoena. The court denied Rodo’s request for an adverse inference against Talles Guimaraes and Ari Cohen. It found no evidence that Exactcar and Azzouz paid the defendants’ legal fees or that they acted together with, or were legally connected to, the defendants in a way that would make the defendants responsible for Exactcar’s conduct. The Clerk of Court was directed to terminate the letter motion at ECF No. 59.