In Rossbach v. Montefiore Med. Cntr., No. 21-2084 (2d Cir. Aug. 28, 2023), the Second Circuit joins other courts in holding that the Seventh Amendment does not require a jury trial to evaluate a claim of evidence fabrication and spoliation under Fed. R. Civ. P. 37(e) and 28 U.S.C. § 1927.
The district court dismissed a plaintiff’s sex harassment case as a sanction for allegedly falsifying “three sexually suggestive text messages.” The defense forensics “expert concluded that the document was a forgery based on the document’s inconsistency with [plaintiff]’s testimony and nonconformity with iPhone text message characteristics.” By clear and convincing evidence, the judge found that plaintiff “had fabricated the [texts] at issue, given false testimony about its production, and spoliated evidence in an effort to conceal the fabrication.” It denied a cross-motion for sanctions against defendants.
“The district court found that, under its inherent power and Federal Rule of Civil Procedure 37(e), a case-terminating sanction was authorized and warranted” against plaintiff. The district court also entered monetary sanctions against plaintiff and her counsel under Rule 37(e) and § 1927. Sanctions against counsel were based on “fail[ure] to conduct a reasonable investigation to ensure that by pressing [plaintiff]’s arguments he was not facilitating the use of false evidence or suborning perjury” and “allow[ing the] client to spoliate evidence by failing to adequately advise [her] to preserve her iPhones and their data.” The final sanctions against plaintiff and counsel were assessed at $157,026.27.
The Second Circuit substantially affirms the sanctions (though it vacates the monetary sanctions against counsel because the district court an inappropriate standard).
One argument for plaintiff was that because the court convened a live, evidentiary hearing on the alleged evidence fraud, the Seventh Amendment required a jury trial. The panel holds that plaintiff thereby “conflates her entitlement to a jury trial on her claims with the question of whether she engaged in sanctionable conduct by committing a fraud on the court and failing to comply with her discovery obligations. Answering the latter is an exercise of the district court’s equitable power, for which ‘a party is generally not entitled to a jury determination on the question.’”
Noting that other circuits had already ruled on this issue, the panel “hold[s] that a motion for sanctions, when premised on a party’s fraud on the court or discovery misconduct under Rule 37, does not implicate the Seventh Amendment’s jury trial guarantee. Resolving such a motion, including by imposing a case-terminating sanction, is solely within the purview of the district court as trier of fact.”
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