District Court Declines to Order Incarceration for Defendant's Bad Faith Spoliation but Orders Monetary Sanction of $337,796.37

Victor Stanley, Inc. v. Creative Pipe, Inc. ("Victor Stanley II")

As previously summarized on this blog, defendant Mark Pappas, President of Creative Pipe, Inc., was ordered to “be imprisoned for a period not to exceed two (2) years, unless and until he [paid] to Plaintiff the attorney’s fees and costs that will be awarded…” as a sanction for willful, bad faith discovery violations which the Magistrate Judge ruled would be treated as contempt of the Court. On defendants’ appeal, the District Court Judge declined to adopt the Magistrate Judge’s order regarding incarceration:

[T]he court does not find it appropriate to Order Defendant Pappas incarcerated for future possible failure to comply with his obligation to make payment of an amount to be determined in the course of further proceedings. Certainly, if Defendant Pappas should fail to comply with a specific payment order, the Court may issue an order requiring him to show cause why he should not be held in civil contempt for failure to comply wit that payment order. Also, under appropriate circumstances, criminal contempt proceedings might be considered.

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Source: ediscoverylaw.com