Money Too.

Kwan Software Eng’g, Inc. v. Hennings, No. H042715 (D6 Dec. 2, 2020)

After a years-long record of fraud on the court, false testimony, and spoliation of evidence, the trial court dismissed Plaintiffs complaint in this case as a terminating sanction. It declined, however, to award Defendants’ monetary sanctions under the discovery act. As we recently discussed, the Discovery Act requires an award of monetary sanctions as compensation in the form of reasonable costs unless the non-prevailing party was substantially justified or an award would be unjust. See Code Civ. Proc. § 2023.030(a). 

In the course of issuing terminating sanctions, the trial court made findings from which it is clear that a substantial justification was not present. Nor would it be unjust—that other sanctions were awarded did not render it unjust to also require plaintiffs to compensate Defendants for the increase expense incurred as a result of Plaintiffs’ discovery misconduct. So the trial court abused its discretion by not awarding monetary sanctions.

Sanctions were not merited, however, against Plaintiffs’ former attorneys. The record established that that the attorneys had not “advised” their clients to engage in discovery abuse, which precludes any award under § 2033.030(a).

Reversed in part.