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White v. Novartis Pharmaceuticals Corp.

October 21, 2010


The opinion of the court was delivered by: Gregory G. Hollows United States Magistrate Judge


Previously pending on this court's law and motion calendar for October 14, 2010, was plaintiff's motion for sanctions, filed September 8, 2010. Plaintiff was represented by Devin Fok. Martin Calhoun and James Bruen appeared on behalf of defendant. After hearing oral argument and reviewing the parties' briefing, the court now issues the following order.


This action concerns decedent William White, who allegedly suffered bisphosphonate related osteonecrosis of the jaw ("BRONJ") after taking defendant's bisphosphonate drug, Zometa, which is prescribed to cancer patients. William White died during the litigation and his wife, Cheryl, became successor in interest.

Plaintiff filed the instant motion seeking sanctions against defendant for allegedly failing to disclose and providing false discovery responses and testimony concerning its direct-to-consumer advertising of Zometa. Plaintiff seeks sanctions in the form of amending defendant's answer to include a statement that it advertised Zometa.*fn1 Plaintiff originally sought an order striking defendant's amended answer or in the alternative, an order requiring the parties to amend their pleadings to conform to the evidence and rulings, including permitting plaintiff to add a loss of consortium claim to her complaint, and striking defendant's learned intermediary defense. The district court noted that plaintiff's reply indicated that she no longer sought a dismissal sanction,*fn2 and therefore directed the motion to be refiled before the magistrate judge.

The instant case was previously part of multi-district litigation, but was transferred to this court earlier this year, after the instant discovery had taken place, but before the MDL court issued its sanctions order. (Dkt. #66, Ex. 1A.) The MDL court imposed sanctions against Novartis in the MDL case based on defendant's actions there and in this case. The MDL court determined, however, that it had no further jurisdiction to enter a sanction order in the White case because it had already been transferred to this court. The MDL court found no evidence that Novartis deliberately withheld documents regarding its advertising from plaintiffs, but that it "clearly failed to adequately supervise its third party vendor's document collection process...." (Dkt. # 66, Ex. 1, Order at 3.)

It appears that Novartis placed four advertisements in CURE magazine, but only produced one relevant issue of CURE and a draft advertisement submitted to the FDA. (Id. at 2.) As part of its sanctions order, the MDL court granted plaintiffs' motion in part to permit further discovery regarding Novartis' advertising of Zometa and/or Aredia*fn3 to consumers, and that Novartis would assume all costs and attorneys' fees for this discovery. After that order was filed, plaintiff conducted further discovery and found more advertisements not previously produced from three other magazines.


I. Legal Standards

Rule 37 authorizes "a wide range of sanctions" for a party's failure to comply with discovery rules or court orders enforcing them. Wyle v. R.J. Reynolds Industries, Inc., 709 F.2d 585, 589 (9th Cir. 1983). Penalizing a party "for dilatory conduct during discovery proceedings" is discretionary. Bollow v. Federal Reserve Bank of San Francisco, 650 F.2d 1093, 1102 (9th Cir. 1981) (citing Fed. R. Civ. P. 37(a)(4)).

In addition to Rule 37 sanctions, "[c]courts are invested with inherent powers that are 'governed not by rule or statute but by the control necessarily vested in courts to manage their own affairs so as to achieve the orderly and expeditious disposition of cases.'" Unigard Sec. Ins. Co. v. Lakewood Engineering & Mfg. Corp., 982 F.2d 363, 368 (9th Cir. 1992) (quoting Chambers v. NASCO, Inc., 501 U.S. 32, 43, 111 S.Ct. 2123, 2132 (1991)); accord Anheuser-Busch, Inc. v. Natural Beverage Distributors, 69 F.3d 337, 348 (9th Cir. 1995) (recognizing inherent power to dismiss counterclaim for concealing discovery documents); Winn v. Associated Press, 903 F. Supp. 575, 580 (SDNY 1995) (imposing monetary sanctions for deliberately impeding discovery and willful noncompliance with document production).

Precluding evidence so that the recalcitrant party cannot support defenses is comparable to entering dismissal, which "represent[s] the most severe penalty that can be imposed." U.S. v. Kahaluu Const., 857 F.2d 600, 603 (9th Cir. 1988); accord, Valley Engineers v. Electric Engineering Co., 158 F.3d 1051 (9th Cir. 1998). Accordingly, such sanctions are authorized only in "extreme circumstances" for violations "due to willfulness, bad faith, or fault of that party." Kahaluu Const., 857 F.2d at 603; see also Commodity Futures Trading Com'n v. Noble Metals Intern., Inc., 67 F.3d 766,770 (9th Cir. 1995) (affirming standard and upholding sanctions in egregious circumstances).*fn4 Bad faith does not require actual ill will; substantial and prejudicial obduracy may constitute bad faith. B.K.B. v. Maui Police Dept., 276 F.3d 1091, 1108 (9th Cir. 2002).

Five relevant factors also determine whether severe sanctions ...

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