There are Limits to Discovery Games
Mr. Hornady filed a lawsuit against his employer, Outokumpo Stainless, in 2018 under the Fair Labor Standards Act due to various wage and hour violations, including failure to pay regular wages for all time clocked in, failure to pay overtime wages, and failure to pay promised bonuses.
Discovery commenced. Outokumpo refused to produce basic time records. The first motion to compel was filed by June 2019. A second and third motion to compel were filed in September and November. There were hearings and an effort to sanction Outokumpo, but the defendant continued to refuse to produce the documents requested. At one point, Outokumpo contended that it had to obtain the records from ADP which was not responding to a subpoena. That turned out to be a false statement according to testimony from the corporate representative of ADP. In June 2020 another motion for sanctions was filed.
A judgement was entered against Outokumpo for misrepresentations and its obstinate refusal to provide the pay records. Obviously, the key evidence needed for the claims were the time records for the plaintiff and for the 280 other employees plaintiff filed suit on behalf.
Outokumpo continued to resist. Finally, after twelve different orders requiring production of these basic documents, the court found that there was clear and convincing evidence of bad faith, including misrepresentations and manipulation. The court further found other relevant factors including spoliation (there was no litigation hold direction from counsel -- and a likelihood that ESI evidence was lost), the need to deter other employers, and the desire to preclude defendant from profiting from its misconduct.