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IN THE SUPERIOR COURT OF THE VIRGIN ISLANDS DIVISION OF ST. THOMAS AND ST. JOHN SHAMARAH HALLIDAY, ) ) CASE NO. ST-14-CV-146 Plaintiff, ) ) VS. ) ACTION FOR DAMAGES ) CRUISE SHIP EXCURSIONS, INC. ) d/b/a KON TIKI PARTY RAFT ) ) JURY TRIAL DEMANDED Defendant. ) ) MEMORANDUM OPINION THIS MATTER is before the Court on Plaintiffs Motion In Limine For Adverse Inference Against Defendant For Spoliation of Evidence (“Spoliation Motion”).! For the reasons set forth herein the Motion will be denied. BACKGROUND Defendant Cruise Ship Excursions, Inc. (“CSX”) operates the motor vessel Kon Tiki in the territorial waters of the Virgin Islands, where it offers social cruises to paying customers. In her Complaint, Plaintiff Shamarah Halliday alleges that she boarded Kon Tiki on October 20, 2013 with a number of friends for an evening of socializing in the coastal waters of St. Thomas. Halliday alleges that, at around 10:00 p.m., she and a friend were leaning against a wooden railing/board; the wooden railing/board cracked or the support screws holding the railing/board gave way, and * Defendant filed an Opposition, but Plaintiff did not file a reply. Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion she fell into the harbor.? She alleges she sustained mental anguish, loss of enjoyment of life, and possible neurological damage from the incident. The matter is scheduled for trial. Halliday now asserts that CSX failed to preserve the “plywood trim” that broke away from the bulkhead of the Kon Tiki and the “short nails” that secured the plywood trim to the bulkhead. She therefore moves for an instruction to the jury that they may make a negative inference that the “plywood trim” and “short nails” were insufficient to secure the railing or gate and that is the reason why Defendant did not preserve that evidence. CSX counters that it is still in possession of the plywood trim as it was re-used to re-attach the gate after the accident, that Halliday made no timely request to produce any of the deck railing materials, and all discovery is closed.‘ LEGAL STANDARD “Spoliation of evidence’ is defined as ‘the destruction or significant alteration of evidence or the failure to preserve the property for another's use as evidence in pending or reasonably foreseeable litigation.”’5 In general, a duty to preserve evidence attaches “when a party has notice that the evidence is relevant to litigation ... but ? Discovery has apparently shown there is disagreement regarding whether Plaintiff alone, or her friend, or both of them, leaned against the railing/gate before it gave way. However, who exerted force on the railing is not relevant to this motion. > CSX asserts that Halliday made an informal request for preservation 1.5 years after discovery was closed; CSX refused the request, and Halliday never sought any relief. “ Halliday’s motion also argues that her expert could not test the materials to determine their strength. CSX counters that Halliday lost the opportunity to test the materials due to her own inaction. 5 R.F.M.A.S., Inc. v. So, 271 F.R.D. 13, 23 n.41 (S.D.N.Y. 2010). Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion also on occasion in other circumstances, as for example when a party should have known that the evidence may be relevant to future litigation.”6 Thus, before engaging in a spoliation analysis, the Court must first determine whether CSX should have initiated a litigation hold over the evidence at issue. To succeed on a motion for spoliation, the movant carries the burden of proving that the evidence in question was: (1) relevant to the litigation (2) within the spoliator's possession or control, and (3) actually suppressed or withheld.’ If the movant can prove all three factors, then the Court must determine the appropriate sanction. The Court considers the following factors to determine the appropriate sanction: (1) the degree of fault of the spoliator; (2) the degree of prejudice suffered by the movant; and (3) whether there is a lesser sanction that will avoid substantial unfairness to the movant and whether an adverse inference will deter spoliative conduct in the future.’ Furthermore, an adverse inference is only an appropriate sanction if “the spoliation or destruction of evidence was intentional, and indicates fraud and a desire to suppress the truth, and it does not arise where the destruction was a matter of routine with no fraudulent intent.”9 ° Bright v. United Corp., 50 V.1. 215, 227 (V.1. 2008). 7 Samuel v. United Corporation, 64 V.|. 512, 518 (V.I. 2016). 8 Bright, 50 V.1. at 225-226 (citing Hechinger Inv. Co. of Del., Inc. v. Universal Forest Prods. (In re Hechinger Inv. Co. of Del., Inc.), 489 F.3d 568, 579 (3d Cir. 2007)). 3 Samuel, 64 V.|. at 518. Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion ANALYSIS Halliday moves for spoliation sanctions against CSX for its alleged failure to preserve the parts of the gate or railing which gave way. The evidence at issue consists of: (1) the plywood trim (“Plywood”) and (2) the fasteners used for securement (“Fasteners”). Halliday argues that CSX should have foreseen litigation arising from Halliday’s fall and that CSX failed to preserve the Plywood and Fasteners for foreseeable litigation. Consequently, she asks the Court to instruct the jury that it may make an adverse “spoliation” inference against CSX. CSX maintains that Halliday never requested production of either the Plywood or Fasteners and, consequently, it never actually withheld relevant evidence. Furthermore, CSX contends that it has possessed and controlled the Plywood since the night of the incident and the Plywood has been re-attached to the bulkhead. With respect to the Fasteners, CSX argues that it took and produced photos of the Fasteners to Halliday, but concedes it either discarded or lost the Fasteners at some point. I. CSX HAD A DUTY TO PRESERVE THE PLYWOOD AND FASTENERS IN LIGHT OF FORESEEABLE LITIGATION Halliday argues that CSX should have foreseen litigation, and thus preserved the Plywood and Fasteners because of the severity of the accident. More specifically, Halliday contends that the fact that CSX had to file an incident report with the Coast Guard and that the Coast Guard official noted that such accidents “almost always Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion result in death” put CSX on notice that it should have preserved Plywood and Fasteners. CSX argues that no duty to preserve attached because litigation regarding Halliday’s fall was not immediately foreseeable. More specifically, CSX contends that it had no reason to expect litigation because Halliday “did not hit anything on the way into the water,” she was successfully recovered from the water, and she was released from the hospital promptly without any apparent injuries. The Court disagrees with CSX’s contention that it had no duty to preserve the evidence. The Court finds Bright v. United Corp." instructive on this issue. In Bright, the plaintiff slipped and fell in the defendant’s store. The Virgin Islands Supreme Court held that the defendant should have foreseen litigation arising from the slip and fall and preserved relevant evidence solely because the plaintiff filled out a formal incident report.'! Similarly, here CSX should certainly have foreseen probable litigation when a Coast Guard incident report was completed and Halliday was taken to the hospital by ambulance. II. | CSX SPOLIATED THE PLYWOOD AND FASTENERS A. Possession and Control Here, CSX admits that it remains in possession and control of the Plywood. In addition, it states that it controlled the Fasteners until sometime after the accident 2050 V.I. 215 (V.1. 2008). 1 Bright, 50 V.\. at 225-226. Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion but that it lost or discarded them at some point. Consequently, CSX does not challenge Halliday on the possession or control prong of the spoliation analysis. B. Relevance Halliday contends that the Plywood and Fasteners were the “most important key evidence from the night’s accident.”!2 The parties agree Halliday fell from the vessel after the Fasteners separated from the Plywood. Consequently, the Court finds that the Plywood and Fasteners are relevant pieces of physical evidence in this case because the central inquiry regarding Halliday’s fall from the vessel revolves around the failure of the gate or railing. C. Actual Suppression or Withholding Halliday argues that this case is strikingly similar to Samuel v. United Corp'3—a premises liability case in which a grocery store voluntarily erased surveillance footage that recorded the area of a patron’s fall. On the contrary, CSX argues that it never withheld the Fasteners or the Plywood. More specifically, it argues that Halliday cannot succeed on an argument that CSX destroyed the evidence because Halliday never requested either item during fact discovery and because the Plywood has been reaffixed to the vessel.'4 Notably, Halliday failed to submit a reply ” Plaintiffs Motion In Limine For Adverse Inference Against Defendant For Spoliation Of Evidence, p. 7. 13 64 V.I. 512 (V.I. 2016). ** CSX asserts it voluntarily disclosed the identity of the persons with knowledge of the repairs made to the deck rail after the incident, but Halliday did not propound any fact discovery or take any depositions regarding the issue. Defendant’s Opposition To Plaintiff's Motion For Adverse Inference Against CSX For Spoliation Of Evidence, p. 3. Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion brief to rebut CSX’s contention. Therefore, Halliday has not rebutted CSX’s contentions. In Samuel, the plaintiff alleged that she slipped and fell on spilled milk in a grocery store owned by United Corp. During discovery, Samuel demanded video footage from United’s surveillance cameras. While United produced some relevant footage, it failed to produce sufficient footage in advance of the fall to demonstrate the condition of the floor immediately prior to Samuel’s fall.!5 Samuel filed a motion for a spoliation inference, in which she contended that United destroyed relevant surveillance footage of the floor prior to her fall. The Superior Court denied Samuel’s motion. It held that United’s preservation efforts were consistent with its store policies regarding surveillance preservation, and thus, its failure to produce certain portions of footage did not give rise to a spoliation inference. The Supreme Court of the Virgin Islands reversed the Superior Court because United failed to preserve “a reasonable portion of the pre-fall footage.”!6 Consequently, it found that the Superior Court erred in that it should have permitted the jury to apply a spoliation inference. In Samuel, the Virgin Islands Supreme Court’s finding that United spoliated evidence did not hinge on whether United failed to turn over the evidence during discovery. Instead, the finding hinged on United’s actual destruction of all footage in excess of one minute and 20 seconds before the patron’s fall. Here, CSX destroyed (or at least failed to preserve) the Fasteners and Plywood. 15 United only preserved 1 minute and 20 seconds of video footage before the fall. 16 Samuel, 64 V.1. at 520. Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion CSX admits it discarded or lost the Fasteners. In addition, while CSX did not discard or lose the Plywood, it did fail to preserve the Plywood in its post-accident condition.'? While the record does not indicate the exact date that CSX reused the Plywood in the rebuilding of the subject gate, it should have preserved the Plywood and Fasteners in their post-accident condition until the close of discovery—when Halliday could no longer request inspection or perform testing. The Court is cognizant that, under certain circumstances, a defendant may be relieved of its duty to preserve evidence which is subject to a litigation hold. For instance, in R.F.M.A.S., Inc. v. So,'8 the plaintiff jewelry designer, R.F.M.A.S., accused defendants of replicating and selling jewelry pieces in violation of its copyrights. The court recognized that defendants could not be expected to withhold all of their for-sale jewelry subject to a litigation hold until the close of discovery. Consequently, the Court suggested that, where the defendants’ businesses hinged on selling its jewelry, they ought to have moved for a protective order allowing them to continue selling jewelry that might be relevant to litigation. However, the facts at hand are quite different. Here, CSX asserts that the Fasteners are generic. Likewise, the Plywood at issue is not a valuable asset in CSX’s business. Consequently, the Court finds—and CSX fails to offer—any reasonable justification for its reuse of the Plywood in 7 See Botell v. United States, 2013 U.S. Dist. LEXIS 38925, *13 (E.D. Cal. Mar. 20, 2013) (granting spoliation sanctions when defendant failed to preserve evidence in its “untouched post-accident condition” until plaintiff's inspection was complete). 18 271 F.R.D. 13 (S.D.N.Y. 2010). Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion reconstructing the gate and the failure to preserve the Fasteners. As a result of the foregoing analysis, the Court finds that CSX spoliated the Plywood and Fasteners. But, the Court must still determine what, if any, sanction is appropriate. II]. WHETHER AN ADVERSE INFERENCE IS THE PROPER SANCTION The trial court has broad discretion to determine the correct sanction for discovery violations.!9 And, the degree of the sanction imposed hinges on an analysis of the degree of fault on the part of the spoliator, the prejudice suffered by the movant, and whether a sanction less severe than an adverse inference is appropriate.2° The appropriate sanction may range from summary judgment on the elements that would have been proven by the spoliated evidence to no sanction at all.?! A. Prejudice Suffered by Halliday Here, CSX alleges that even if the Court does find that it spoliated the evidence, an adverse inference instruction is not appropriate because Halliday was not prejudiced. Specifically, it argues that fact discovery had been closed a considerable length of time before Halliday ever suggested that CSX spoliated evidence. Furthermore, it contends that Halliday never availed herself of the formal 8 see, e.g., Klezmer v. Buynak, 227 F.R.D. 43, 51 (E.D.N.Y. 2005) (“Trial judges should have the leeway to tailor sanctions to insure that spoliators do not benefit from their wrongdoing—a remedial purpose that is best adjusted according to the facts and evidentiary posture of each case.”). 20 Bright, 50 V.I. at 225-226. 21 Remy v. Ford Motor Co., 48 V.I. 141, 150 (V.I. Super. Ct. 2006) (discussing the breadth of available sanctions and the discretion the trial court retains in deciding whether to impose sanctions). Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion discovery mechanisms necessary to obtain access to the Plywood and/or the Fasteners during fact discovery and, as such, an adverse inference is not an appropriate sanction. The Court agrees. While not binding, the Court finds R.F.M.A.S., Inc. v. So instructive here. In R.F.M.A.S., after the close of discovery, the plaintiff moved for spoliation sanctions against all defendants. The plaintiff claimed that defendants spoliated pieces of jewelry that were relevant to its case as well as key code evidence that it could use to link the infringing jewelry to the sales data of defendants’ stores. While the court granted spoliation sanctions, it did so only with regard to the pieces of jewelry—which were the only items that the plaintiff explicitly requested to inspect during discovery. The court noted, “[a]lthough discovery tools can be powerful, they do nothing for the litigant who chooses not to use them.”22 In short, although the plaintiff made some informal discovery requests regarding the key code evidence, it failed to avail itself of formal discovery tools—including compelled discovery pursuant to Fed. R. Civ. P. 37(a).23 The court further found, By making the request formally, plaintiff could have compelled defendants to either produce the information sought or explain the failure, all within a given time frame determined by the timing of plaintiffs request. Plaintiff's decision to make a series of ad hoc complaints to the court, not tied to specific discovery requests, about alleged misconduct by defendants spanning several years has 22 R.F.M.A.S., 271 F.R.D. at 43; see also Healthcare Advocates, Inc. v. Harding, Earley, Follmer & Frailey, 497 F. Supp. 2d 627, 642 (E.D. Pa. 2007) (denying request for spoliation sanctions where movant failed to request the subject evidence); Allstate Ins. Co. v. Hamilton Beach/Proctor Silex, Inc., 473 F.3d 450, 458 (2d Cir. 2007) (refusing to grant spoliation sanctions where movant never asked to inspect the evidence at issue). 8 See R.F.M.A.S., 271 F.R.D. at 43; see also Helfand v. Gerson, 105 F.3d 530, 536 (9th Cir. 1997) (failure to bring a motion to compel is a waiver of any future objections). Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion undoubtedly wasted the time and resources of both parties and the court. Id. at *45.24 Here, CSX contends—and Halliday does not rebut—that Halliday never demanded inspection of the Plywood or the Fasteners in any formal discovery request. Even if the Plywood and Fasteners were fully preserved, Halliday would not have been able to introduce them at trial since she never inquired of them, either by interrogatory or inspection, or during any deposition of any of CSX’s witnesses.?5 Consequently, it cannot be said that Halliday suffered injury from the spoliation of evidence that she never formally requested.?6 B. CSX’s Degree of Fault An adverse inference instruction should be given “only when the spoliation or destruction [of evidence] was intentional, and indicates fraud and a desire to suppress the truth, and it does not arise where the destruction was a matter of routine with no fraudulent intent.”27 Here, CSX’s actions do not indicate a fraudulent intent or a desire to suppress the truth. Of note, CSX photographed the Fasteners as well as the 24 Similarly, discovery in the Superior Court is governed by Federal Rules of Civil Procedure 26 to 37, inclusive pursuant to SUPER. CT. R. 39{a). 5 The factual scenario in Bright and Samuel differs significantly from this case. In Bright and Samuel the Plaintiffs requested video surveillance footage and made inquiry of missing footage when deposing the store managers. Here, Halliday has not developed any facts regarding when or why the Plywood was re-used or the Fasteners discarded or what consideration CSX gave to the matter before re-using and discarding the evidence. Halliday simply never pursued the issue during discovery. 7° R.F.M.A.S., 271 F.R.D. at 24 (“Where the discovery violation involves spoliation or withholding of evidence, the absence of prejudice can be shown by demonstrating, for example, that the other parties were able to obtain the same evidence from another source, or that during discovery they never asked for the evidence later shown to have been spoliated.”). 2? Bright, 50 V.1. at 226. Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion Plywood at some time before it conducted the repair, and CSX asserts it voluntarily disclosed said photographs to Halliday at the beginning of the case.?8 These efforts on the part of CSX cut against a finding of fraudulent intent. 29 Consequently, the Court finds that CSX’s fault was negligent, but not intentional, nor fraudulent. C. Whether a Lesser Sanction is Appropriate In light of the lack of prejudice suffered by Halliday and CSX’s limited degree of fault, the Court finds that an adverse inference instruction is not appropriate. To begin, the Court must reiterate that Halliday—as the plaintiff moving for spoliation sanctions—carries the burden of proof on this motion. Halliday provides no evidence of CSX’s fraudulent intent or desire to suppress the truth. For instance, unlike both Samuel and Bright, Halliday does not provide any interrogatory or deposition evidence illustrating that CSX discarded the Fasteners or reused the Plywood.#? Rather, she asserts—without citation to any record evidence—that CSX destroyed the Fasteners and Plywood.! On the contrary, the only basis for the Court to reach any conclusion regarding the whereabouts of the Fasteners or Plywood comes from CSX’s candid Opposition to Plaintiffs Motion for Adverse Inference Against CSX for 28 Defendant’s Opposition To Plaintiff's Motion For Adverse Inference Against CSX For Spoliation Of Evidence, p. 2. *° See Schmid v. Milwaukee Elec. Tool Corp., 13 F.3d 76, 79 (3d Cir. 1994) (suggesting that photographing evidence before altering it cut against a finding of fraudulent intent). 3° See Bright, 50 V.1. at 225; see also Samuel 64 V.I. at *? Halliday’s only significant citation comes by way of a footnote which references the deposition of one of Halliday’s experts, Capt. Bret Gilliam. During the deposition, Halliday’s counsel inquired of CSX’s counsel whether CSX preserved the Plywood and Fasteners. CSX’s counsel responded “I’m unaware one way or another.” See Plaintiff's Motion for Adverse Inference Against CSX for Spoliation of Evidence, p. 4. Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion Spoliation of Evidence, wherein it disclosed that it reused the Plywood and lost or discarded the Fasteners.*2 The Court has considered the relative fault of CSX and the possibility of prejudice to Halliday. CSX bears some fault for not preserving the Plywood and Fasteners in their post-accident condition until at least the close of discovery.3? But Halliday bears fault here too for neglecting to request inspection of the Fasteners and Plywood. Thus, in consideration of Halliday’s fault, the Court finds that the imposition of harsh sanctions against CSX does not serve the inherent goal of preventing spoliative conduct in the future. In light of the foregoing analysis, the Court finds that no sanction is necessary to remedy CSX’s spoliation given the relative faults of CSX and Halliday.*4 CONCLUSION CSX negligently spoliated relevant evidence from the Kon Tiki. However, the spoliation was not intentional nor fraudulent. Furthermore, Halliday is not prejudiced by the spoliation of the evidence as she never made any formal inquiry for the evidence during discovery. Therefore, the motion for an adverse inference to the jury is denied. 2 Defendant’s Opposition To Plaintiff's Motion For Adverse Inference Against CSX For Spoliation Of Evidence, p. 2. *? The Record does not reflect the time or date that the Fasteners were lost or the Plywood was reused. The Court can only assume that the Plywood was reused before the close of discovery based on CSX’s assertion that Halliday’s expert and counsel inspected and photographed the repaired deck rail assembly. See Defendant’s Opposition To Plaintiff's Motion For Adverse Inference Against CSX For Spoliation Of Evidence, p. 2. ** see Fujitsu Ltd. v. Fed. Express Corp., 247 F.3d 423, 436 (2d Cir. 2001) (“It is undisputed that FedEx did not request to inspect the damaged shipping container after Fujitsu notified it of the damage, nor at any time other than prior to it making the summary judgment motion in August 1999. Accordingly, the trial court did not abuse its discretion in finding that, under the particular facts of this case, no sanction for spoliation was required.”). Halliday v. Cruise Ship Excursions, Inc. Case No. ST-14-CV-146 Memorandum Opinion An Order consistent with this Memorandum Opinion will be entered. Levee Jrealec DATED: February Cc , 2017 Kathleen Mackay = Judge of the Superior Court of the Virgin Islands ATTE$T ESTRELA H. GEORG “~~ Acting Clerk of the Cour By LQRI BOYN TYSON Court Clerk Jupervisor a/ lo; P'f-