Here is a paper from Perkins Coie on a Washington Supreme Court opinion approving an $ 8 million judgment entered against Hyundai as a discovery sanction for failing to reveal prior claims involving the same seat at issue in this case. (The link is to Mondaq – registration required; the article does not yet seem to be on the Perkins Coie website). The case name is Magana v. Hyundai Motor Am. The majority opinion is here, and a dissent is here.
Set out below are the paper’s summary of the key points from the opinion – note especially the first and second bullet points.
“At least three things are worth noting about this decision.
- First, the Court held that Hyundai was required to search more than just its legal department’s records for information responsive to the plaintiff’s discovery requests. (In the trial court, Hyundai had tried to defend its limited initial search for responsive information on the ground that searching beyond the legal department “would have taken an extensive computer search.”) The trial court, in fact, held that, as “a sophisticated multinational corporation, experienced in litigation,” Hyundai “had the obligation not only to diligently and in good faith respond to discovery efforts, but to maintain a document retrieval system that would enable the corporation to respond to plaintiff’s requests.” (Emphasis added.)
- Second, the Court held that Hyundai’s objections to the plaintiff’s discovery requests did not entitle Hyundai to respond only to the limited extent that the company did respond. Instead, the Court held, Hyundai was required to ask the trial court for a protective order excusing the company from responding to the plaintiffs’ discovery requests as written. The civil rules have required this step for some time, unless the parties have agreed to narrow the applicable discovery requests. Magana shows that failing to comply with the requirement can have very serious consequences.
- Finally, a default judgment would not always be appropriate for failure to respond fully to discovery. In upholding this extreme sanction in the Magana case, the Court referred to the “unique facts and circumstances” of the case, and two dissenting justices argued that even on these facts, a lesser sanction was more appropriate. All of the justices agreed, however, that Hyundai’s conduct merited sanctions. The decision thus serves as a dramatic reminder that trying to “game” the discovery process is a decidedly perilous undertaking in Washington”