Magistrate Grimm’s $1 Milllion E-Discovery Sanction Decision Affirmed by District Court

John Blumenschein June 21, 2011

Chief U.S. Magistrate Judge Paul W. Grimm’s 103-page landmark e-discovery spoliation sanction decision, Victor Stanley, Inc. v. Creative Pipe, Inc., 2010 WL 3703696 (D.Md. Sept. 9, 2010) (“Victor Stanley II”), was recently affirmed on June 14, 2011. United States District Judge Marvin J. Garbis adopted the Memorandum and Order of Judge Grimm as the decision of the Court, and ordered defendants to pay plaintiff $571,440.12 by July 15, 2011, constituting the balance due of a total sanction award of $1,049,850.04.

In Judge Grimm’s order, Mark Pappas, president of defendant Creative Pipe, Inc., was required to serve up to two years in prison if he failed to pay immediately the plaintiff’s fees and costs related to its motions for spoliation of evidence; that jail sentence, however, had been subsequently overturned by Judge Gabris. While Judge Gabris had indicated that he still might consider jail when the sanctions were upheld, the issue was not addressed in the present order.

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