Kenneth DAY, Plaintiff, v. LSI CORPORATION, Defendant No. CIV 11-186-TUC-CKJ United States District Court, D. Arizona Filed October 07, 2014 Signed October 03, 2014 Counsel James Michael Morris, Morris & Morris PSC, Lexington, KY, for Plaintiff. Kristy Leah Peters, Littler Mendelson PC, Phoenix, AZ, Robert W. Cameron, Littler Mendelson PC, Pittsburgh, PA, for Defendant. Jorgenson, Cindy K., United States District Judge ORDER *1 Pending before the Court are the Motion to Alter, Vacate or Amend the Court's December 20, 2012, Order (Doc. 139) filed by Plaintiff Kenneth Day (“Day”) and the Motion for Reconsideration (Doc. 141) filed by Defendant LSI Corporation (“LSI”). Also pending before the Court are Day's Motions for Hearing or Conference (Docs. 163 and 164). I. Procedural History In a December 3, 2011, Amended Complaint, Day alleged claims of breach of contract, breach of corporate handbook policies, breach of implied covenant of good faith and fair dealing, fraud, deceit, and misrepresentation (fraudulent inducement), interference with a contractual advantage, constructive discharge, intentional and/or negligent infliction of emotional distress, discrimination, and retaliation against LSI. The Court's July 13, 2011, Scheduling Order set a discovery deadline of January 13, 2012 and a dispositive motion deadline of February 17, 2012. The discovery and dispositive motion deadlines were subsequently extended. On December 29, 2011, Day filed a Motion for Entry of Default Judgment, Sanctions, and To Set Hearing On Damages (Doc. 85), Motion for Imposition of Sanctions and to Compel Discovery (Doc. 86), and a Statement of Facts in Support of Motions for Sanctions, Default, and to Compel (Doc. 87). The Court issued an Order denying Plaintiff's Motion for Imposition of Sanctions and to Compel Discovery “with leave to resubmit; if the issues do not become moot upon resolution of the Motion for Entry of Default Judgment, Sanctions, and to Set Hearing on Damages.” Doc. 91, p. 3. Day filed his Second Request to Extend Pre-trial Deadlines on February 29, 2012. The request was granted and the discovery deadline was set for October 29, 2012, and the dispositive motion deadline was set for November 30, 2012. On November 19, 2012, LSI filed a Motion for Summary Judgment on Day's claims. Doc. 132. On November 20, 2012, Day filed a Third Motion to Extend. Doc. 135. II. Standard for Motion for Reconsideration The Court has discretion to reconsider and vacate an order. Barber v. Hawaii, 42 F.3d 1185, 1198 (9th Cir. 1994); United States v. Nutri-cology, Inc., 982 F.2d 394, 396 (9th Cir. 1992). “The purpose of a motion for reconsideration is to correct manifest errors of law or fact or to present newly discovered evidence.” Harsco Corp. v. Zlotnicki, 779 F.2d 906, 909 (3rd Cir. 1985), cert. denied, 476 U.S. 1171 (1986). Reconsideration is also appropriate where there is an intervening change in controlling law. School Dist. No. 1J, Multnomah Cty., Or. v. ACandS, Inc., 5 F.3d 1255, 1263 (9th Cir. 1993). “The same standards govern determining both clear error and manifest injustice.” Breeser, et al. v. The Menta Group, Inc. NFP, et al., Case No. CV 10-1592-PHX-JAT, 2013 WL 3199828 * 3 (D. Ariz. June 24, 2013), citation omitted; see generally Northwest Acceptance Corp. v. Lynnwood Equipment, Inc., 841 F.2d 918, 925-26 (9th Cir. 1988). Indeed, a motion for reconsideration is not to be used to ask a court “to rethink what the court had already thought through—rightly or wrongly.”Above the Belt, Inc. v. Mel Bohanan Roofing, Inc., 99 F.R.D. 99, 101 (E.D. Va. 1983) (limiting motions for reconsideration to cases where the court has patently misunderstood a party, where the court has made a decision outside the adversarial issues presented to the court, where the court has made an error not of reasoning but of apprehension, or where there has been a controlling or significant change in the law or facts since the submission of the issue to the court); see also United States v. Rezzonico, 32 F.Supp.2d 1112, 1116 (D. Ariz. 1998). Further, a motion for reconsideration is not an appropriate method for an unsuccessful party to “rehash” arguments previously presented. Hallas v. Ameriquest Mortgage Co., 406 F.Supp.2d 1176 (D. Or. 2005), quoting 766347 Ontario Ltd. v. Zurich Capital Mkts., Inc., 274 F.Supp.2d 926, 929 (N.D. Ill. 2003). III. LSI's Motion for Reconsideration (Doc. 141) A. HRD Document *2 LSI disputes the Court's conclusion regarding spoliation of the HRD document. LSI asserts that the HRD document was produced and that no second HRD document exists or ever existed. The testimony of Ian White (“White”) indicates that an HRD was prepared for Day's promotion. SeeWhite Depo., Doc. 129-2, p. 31-32, 46. However, White also testified that the Skelton review would not trigger an HRD. Id. at Doc. 129-2, p. 51. LSI does point out that Day did not show White the Bates 1408-1411 document, which would have clarified whether that was the document White recalled as the HRD for Day's promotion. Day responds that this issue was thoroughly briefed and discussed during the hearing on this matter. In effect, Day asserts LSI is asking the Court to re-weigh the significance to place on White's testimony that appears to corroborate that there is a separate January 2009 HRD document that detailed the compensation and bonus structure surrounding Day's January promotion. Where a party seeks sanctions for the spoliation of evidence, that party must “prove the following elements: (1) the party having control over the evidence had an obligation to preserve it when it was destroyed or altered; (2) the destruction or loss was accompanied by a ‘culpable state of mind;’ and (3) the evidence that was destroyed or altered was ‘relevant’ to the claims or defenses of the party that sought the discovery of the spoliated evidence [.]” Surowiec v. Capital Title Agency, Inc., 790 F.Supp.2d 997, 1005 (D. Ariz. 2011), quoting Goodman v. Praxair Servs., Inc., 632 F.Supp.2d 494, 509 (D. Md. 2009). The parties dispute whether a separate HRD document ever existed. The Court inferred the document's existence based on the deposition testimony of Ian White (“White”) and found a culpable state of mind as to the HRD Human Resources document e-mail based on an inference from the culpable state of mind found as to the Skelton documentation. As it was Day's burden to establish the spoliation, the Court's determinations should also have included consideration of Day's conduct and efforts. The deposition testimony relied upon by Day is subject to interpretation. For example, the inferences the Court afforded White's deposition testimony in support of Day's position was not appropriate where Day had an opportunity to clarify White's position regarding the HRD document; i.e., Day could have showed White the document and allowed White to specify whether he recalled a separate document. The Court finds it was manifest error to accept an inference regarding the document where (1) it was Day's burden to establish the spoliation and (2) consideration of the inference (rather than testimony specific to the document) was before the Court because Day had not taken the opportunity to clarify White's deposition testimony. Therefore, the Court will reconsider its ruling on this issue to correct a manifest error of law or fact. The evidence presented to the Court did not adequately establish the existence of the document. Further, Day did not sustain his burden of proof to establish the existence of the document; it was manifest error to find that Day had established the destruction or loss of the HRD document was accompanied by a culpable state of mind. B. Bullinger E-Mail Similarly, the Court inferred a culpable state of mind as to the Bullinger e-mail. The Court determined that LSI had not provided an adequate reason for the non-disclosure of this document. However, the parties dispute the existence of this email. The deposition testimony presented to the Court again does not specifically establish the existence of such an e-mail. For example, Robin Huber (“Huber”) and White testified they believed such an e-mail existed. However, neither testified there was definitively a separate e-mail from the Bullinger e-mail that White forwarded to Huber. As previously stated, it was Day's burden to establish a spoliation showing. The evidence establishes that an e-mail was forwarded to Huber and there mayhave been a separate e-mail. The Court finds it is appropriate to reconsider its ruling on this issue to correct a manifest error of law or fact. The evidence presented to the Court did not adequately establish the existence of the document. It was manifest error to find that Day had established the destruction or loss of the Bullinger e-mail was accompanied by a culpable state of mind. C. Appropriate Sanction *3 The Court previously ordered sanctions of a partial default judgment, the use of an adverse inference jury instruction, and a monetary award for the spoliation of evidence. The Court determined the sanction in this case based on the spoliation of multiple documents. The Court herein has determined that insufficient evidence establishes the spoliation of the HRD document and the Bullinger e-mail. The entry of default as a sanction is only warranted where the party “engaged deliberately in deceptive practices that undermine the integrity of judicial proceedings” or “has willfully deceived the court and engaged in conduct utterly inconsistent with the orderly administration of justice.” See Leon v. IDX Sys. Corp., 464 F.3d 951, 958 (9th Cir. 2006), quoting Anheuser–Busch, Inc. v. Natural Beverage Distribs., 69 F.3d 337, 348 (9th Cir. 1995). Accordingly, “a finding of ‘willfulness, fault, or bad faith’ is required” for a terminating sanction for spoliation of evidence to be appropriate. Id.; see also United Staets v. Kitsap Physicians, 314 F.3d 995, 1001 (9th Cir. 2002) (noting that destruction of evidence is willful spoliation if party has “some notice that the documents were potentially relevant to the litigation before they were destroyed”). Additionally, the Ninth Circuit has established a five-part test to determine whether a terminating sanction is just: (1) the public's interest in expeditious resolution of litigation; (2) the court's need to manage its dockets; (3) the risk of prejudice to the party seeking sanctions; (4) the public policy favoring disposition of cases on their merits; and (5) the availability of less drastic sanctions. Valley Eng'rs Inc. v. Elec. Eng'g Co., 158 F.3d 1051, 1057 (9th Cir. 1998). This Court has found that LSI was at fault for failing to preserve potentially relevant evidence in this case. December 20, 2012 Order, Doc. 138. Although LSI was on notice of the litigation and claims on January 7, 2011, LSI did not act to ensure that all relevant documents were retained. However, as the Court has reconsidered the spoliation of the HRD document and the Bullinger e-mail, the spoliation as a result of the limited document retention when LSI was advised of the lawsuit is the only spoliation to consider in determining an appropriate sanction. Additionally, it cannot be said that considerable delay in this case is attributable to the spoliation. Rather, delay has primarily occurred due to the litigation of discovery issues. Further, the Court does not find the risk of substantial prejudice to Day if partial default is not entered against LSI in light of the reconsideration of the issues. The Bullinger e-mail and HRD documents, if they exist, may support Day's claims, but at this time, it is only the lack of Skelton documentation that the Court has found to be spoliated. Because it has not been shown that the potentially corroborating evidence exists, the Court finds Day is not substantially prejudiced by the spoliation of the evidence. It cannot be said that Day suffered substantial prejudice because LSI's destruction of evidence has “impair[ed Day's] ability to go to trial” and “threaten[ed] to interfere with the rightful decision of the case.” Anheuser–Busch, Inc., 69 F.3d at 353–54, internal citations omitted. The Court previously ordered that Day was entitled to an adverse inference instruction at trial. For the same reasons stated infra, the Court reconsiders and modifies this order. The Court will determine at trial if an adverse jury instruction is appropriate. The Court finds that the monetary sanction previously ordered is sufficient to address the spoliation and the discovery disputes. IV. Day's Motion to Alter, Vacate or Amend the Court's December 20, 2012, Order (Doc. 139)[1] Day asserts that the Court's determination that further discovery should not be permitted ignores the Court's previous Order denying discovery requests pending resolution of the default issues. As pointed out by Day, the Court previously stated: The Court will deny the Motion for Imposition of Sanctions and to Compel Discovery with leave to resubmit; if the issues do not become moot upon resolution of the Motion for Entry of Default Judgment.... Day will be permitted to refile the motion in compliance with the Court's ten page limitation. January 5, 2012, Order, Doc. 91, p. 3. Day argues that depositions needed to be postponed until the Court addressed the ongoing withholding of records and misconduct of Corporate Counsel Bento. Day argues that the issues he previously raised in his motion to compel are now ripe and that he could not adequately complete discovery until the issues are resolved. *4 LSI argues, however, that Day did not seek his third extension of deadlines until after seeing the arguments LSI made in its summary judgment motion and did seek this extension until after the discovery deadline had passed; LSI points out the Court stated Day had not provided any reason why he did not request the extension prior to the expiration of the deadline. Further, LSI asserts the Court considered possible prejudice. LSI asserts that Day's misapprehension that the lawsuit was in abeyance until the Court ruled on pending motions does not constitute a basis for reconsider. Indeed, LSI points out the Court set new deadlines after the Court's statement that discovery issues could be resubmitted. Further, LSI argues the denial of the requested third extension does not constitute a manifest injustice—Day has conducted extensive discovery over an 18 month period and there is no reason why Day could not have conducted additional depositions during discovery. Although the Court considered whether further discovery is appropriate, the Court failed to consider the Court's prior ruling. See Doc. 91. The Court finds it appropriate to reconsider its December 20, 2012, Order and to permit limited additional discovery. The Court has reviewed Day's Renewed Motions to Compel Discovery (Doc. 140) and LSI's response (Doc. 150).[2] LSI has objected to many of the discovery requests, but has nonetheless provided some discovery pursuant to those requests. The Court agrees with LSI that Day has not set forth why LSI's answers, designations, or responses are deficient. SeeLRCiv 37.1. Further, the Court finds LSI's objections to be well-taken: generally, Day's requests are overly broad and seek disclosure of documents that are not likely to lead to admissible evidence. However, the Court does find it appropriate to permit Day to conduct depositions of Milind Kamik, Philip W. Bullinger, and Peggy Huck. The Court will extend the discovery deadline to permit this limited discovery. Counsel and the parties shall cooperate with each other in the scheduling of the depositions. V. Motions for Hearing or Conference (Docs. 163 and 164) Day requests this matter be set for hearing. The Court declines to set this matter for hearing. See LRCiv 7.2(f) (“The Court may decide motions without oral argument. If oral argument is granted, notice will be given in a manner directed by the Court.”) Accordingly, IT IS ORDERED: 1. The Motion to Alter, Vacate or Amend the Court's December 20, 2012, Order (Doc. 139) is DENIED IN PART and GRANTED IN PART. 2. The Motion for Reconsideration (Doc. 141) is DENIED IN PART and GRANTED IN PART. 3. The Motions for Hearing (Doc. 163 and 164) are DENIED. 4. The Court's award of Partial Default Judgment in favor of Day and against LSI as to Day's claim regarding the 30,000 shares of LSI stock as stated in Count II of Day's Amended Complaint is VACATED. 5. The Court's decision that the use of an adverse inference jury instruction is appropriate is VACATED. 6. The Court's December 20, 2012 Order, see Doc. 138, directing the parties to file briefs addressing the appropriate procedure to follow to determine damages is VACATED. 7. All discovery shall be completed on or before December 12, 2014. 8. Additional dispositive motions shall not be filed before the conclusion of discovery. Dispositive motions shall be filed on or before January 26, 2015. Footnotes [1] The Court accepts this Motion as a Motion for Reconsideration. [2] The Court previously denied this motion as not ripe. See Doc. 160.