Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-3_06-cv-02927/USCOURTS-azd-3_06-cv-02927-1/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 15:1681 Fair Credit Reporting Act

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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

CHRISTINE BAKER, 

Plaintiff, 

vs.

TRANSUNION L.L.C.; EQUIFAX

INFORMATION SERVICES, L.L.C.;

FOCUS RECEIVABLES

MANAGEMENT, L.L.C.; JAMES

HURD; DIRECTV; DANA CAPITAL

GROUP; NCO FINANCIAL SYSTEMS, 

Defendants. 

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No. CV-06-2927-PCT-NVW

ORDER

Before the court is the issue of the proper sanction for the Plaintiff’s willful and

deliberate violation of the court’s December 10, 2007 Confidentiality Order (Doc. #85). 

After careful consideration of the interests of justice and all matters of record, the court

concludes that the Plaintiff’s claims should be dismissed with prejudice.

I. Background

The Plaintiff, Christine Baker (“Ms. Baker”) filed this action seeking damages and

injunctive relief for violations of the Fair Credit Reporting Act, the Fair Debt Collection

Practices Act, the Telephone Consumer Protection Act, breach of contract, negligence,

gross negligence, and negligent and intentional infliction of emotional distress stemming

from the Defendants’ allegedly unlawful attempt to collect an outstanding debt. In

Case 3:06-cv-02927-NVW Document 113 Filed 02/26/08 Page 1 of 7
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November 2007 Ms. Baker filed a Motion to Compel Defendant Focus Receivables

(“Focus”) to respond to her discovery requests. At a hearing held on December 7, 2007,

Focus indicated that it was in the process of providing the requested documents. 

Therefore, the court granted Ms. Baker’s motion and ordered Focus to pay her expenses. 

However, before producing the documents Focus prepared a Stipulation to Entry of

Confidentiality Order (Doc. #83) which it presented to Ms. Baker on the day of the

hearing. She signed the order and the parties submitted it to the court. On December 10,

2007, the court issued a Confidentiality Order which stated in relevant part: 

All documents disclosed, including but not limited to, training

and testing materials copyrighted and utilized by Focus shall

be considered proprietary and will be held in confidence,

which confidentiality includes all information contained in

those documents. . . . Baker is directed not to disclose, publish

or otherwise reveal any of the Confidential Information

received from Focus to any other party whatsoever. For

purposes of this litigation, publish includes the reproduction

of the information contained in the documents in any format

whether orally, in tangible form through duplication, or

otherwise, in written form or on a web site (Baker’s

creditsuit.org or any other web site).

(Doc. # 85.)

Following the December 7 hearing and pursuant to her discovery requests, Ms.

Baker received a copy of Focus’ Training Manual. On December 10, 2007, Ms. Baker

published a post on her website concerning the Confidentiality Order in which she stated,

“I don’t even know why I signed it. What good do their docs do me if I can’t publish

them?” On or about December 31, 2007, Ms. Baker created another post on the same

website which summarized the contents of the Focus Training Manual, including its debt

collection practices. In response, Focus filed a Motion for Sanctions and to Compel

Compliance with Confidentiality Order (Doc. #88). The court held a hearing on the

motion on January 11, 2008, and found that Ms. Baker “willfully, intentionally, and with

full awareness of the Order, breached the Confidentiality Order in plain bad faith.” (Doc.

# 95.) The court directed Ms. Baker to remove all statements about the Focus Training

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Manual from her website and ordered the parties to submit legal memoranda regarding

the proper sanction for her breach of the Order.

In the weeks that followed, Ms. Baker filed a motion to seal her memorandum

regarding sanctions (Doc. # 106) and a separate motion for sanctions against the

Defendant (Doc. # 108). In response, Focus requested that the court strike both motions

(Doc. # 110). Finally, Ms. Baker made a last attempt to avoid dismissal with a motion to

vacate the Confidentiality Order (Doc. # 112). The court finds that Ms. Baker’s request

for sanctions against the Defendant and her motion to vacate the Confidentiality Order are

unwarranted. In addition, the court concludes that dismissal of her case is an appropriate

sanction given the willful nature of her actions, the irreparable harm suffered by Focus,

and the court’s interest in maintaining the integrity of its orders.

II. The Plaintiff’s willful violation of the court’s confidentiality order satisfies the

five-part test for involuntary dismissal. 

“Where it is determined that counsel or a party has acted wilfully or in bad faith in

failing to comply with rules of discovery or with court orders enforcing the rules or in

flagrant disregard of those rules or orders, it is within the discretion of the trial court to

dismiss the action or to render judgment by default against the party responsible for the

non-compliance.” G.K. Properties v. Redevelopment Agency of San Jose, 577 F.2d 645,

647 (9th Cir. 1978). A court may dismiss a case for failure to obey a confidentiality order

pursuant to either Rule 16(f) or 41(b) of the Federal Rules of Civil Procedure. Rule

16(f)(1)(C) states that a court may impose any sanction authorized by Rule

37(b)(2)(A)(ii)-(vii) for violation of a pretrial order. Rule 37(b)(2)(A)(v) specifically 

provides for the sanction of dismissal. Similarly, Rule 41(b) permits a court to order

dismissal “[f]or failure of the plaintiff . . . to comply with . . . any order of [the] court.” 

“The standards governing dismissal for failure to obey a court order are basically the

same under either of these rules.” Malone v. U.S. Postal Service, 833 F.2d 128, 130 (9th

Cir. 1987).

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Before imposing the sanction of dismissal, a court must weigh five factors: (1) the

public’s interest in expeditious resolution of litigation; (2) the court’s need to manage its

docket; (3) the risk of prejudice to the defendants; (4) the public policy favoring

disposition of cases on their merits; and (5) the availability of less drastic sanctions. Id.

Although the fourth factor will nearly always weigh against dismissal, “it is not sufficient

to outweigh the other four factors” where, as in this case, they support dismissal. Id. at

133 n.2.

Here, the first two factors clearly weigh in favor of dismissal. A party’s willful

violation of court orders impairs the public interest in the expeditious and fair resolution

of controversy and undermines the institutional integrity of the court. The public cannot

rely on the judicial process and courts cannot function efficiently unless parties are bound

to conform with court orders. In almost every business lawsuit parties are required to

provide confidential or proprietary information to the other side, but no one loses his or

her right to privacy simply because they have been sued. 

A paramount consideration of the public interest is that the very integrity of the

civil litigation process is grounded in people’s ability to believe that protective orders will

be obeyed. Parties surrender their private information in the course of litigation only

because they trust in the good faith of their adversaries to comply with the court’s order

for the protection of their mutual privacy, confidentiality, and business information. Ms.

Baker’s flagrant violation of the confidentiality order and then daring the Defendant to

trace provable harm from it makes a mockery of confidentiality of the discovery process. 

People will not disclose their private information in civil litigation if their only recourse

for the malicious destruction of their privacy is to incur legal expense to prove what is

usually not provable–that is, exactly how the loss of privacy has hurt their pocketbooks. 

It is critical to litigants’ ability to trust in the discovery process to see that the courts deal

forcefully with any violation of confidentiality. Ms. Baker’s extraordinary violation, the

bad faith of which she herself proclaimed in her internet posting, plainly calls for the

strongest sanction and the best hope of a prophylactic message to other litigants.

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“[I]n this era of crowded dockets” parties who willfully abuse the discovery

process “also deprive other litigants of an opportunity to use the courts as a serious

dispute-settlement mechanism.” G.K. Properties, 577 F.2d at 647. “It is well settled that

dismissal is warranted where, as here, a party has engaged deliberately in deceptive

practices which undermine the integrity of judicial proceedings.” Anheuser-Busch, Inc. v.

Natural Beverage Distrib’s., 69 F.3d 337, 348 (9th Cir. 1995); see also Wyle v. R.J.

Reynolds Indust., 709 F.2d 585, 589 (noting that district courts have the power to dismiss

an action where a party wilfully “engage[s] in conduct utterly inconsistent with the

orderly administration of justice”). The integrity of the discovery process depends

completely on careful, scrupulous, and literal observance of any protective order which a

court may enter regarding such information. Ms. Baker’s flagrant breach of her duties is

inexcusable. 

“Whether prejudice is sufficient to support an order of dismissal is in part judged

with reference to the strength of the plaintiff’s excuse for the default.” Malone, 833 F.2d

at 131. Ms. Baker’s principal argument against sanctions is that she did not violate the

Confidentiality Order and that Focus could not have been prejudiced because she did not

actually reproduce any portion of its training manual. However, her assertion is patently

false, given the clear language in the order which states that she could not “disclose,

publish, or otherwise reveal” the contents of any discovery material entrusted to her care. 

Ms. Baker’s profession of ignorance of this duty is unbelievable in light of the plain

words of the confidentiality order.

Ms. Baker also argues that the information she posted on her website could not

have caused Focus actual harm. However, Focus is not required to show actual harm to

establish Ms. Baker’s violation of the court’s order. The Confidentiality Order clearly

applied to all “documents produced pursuant to this litigation.” If Ms. Baker believed

that certain information contained in those documents was not deserving of

confidentiality, then it was her responsibility to seek permission from the court before

publishing it. A party who consciously violates a court order does so at her own peril. In

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any event, it is precisely the intangible nature of Focus’ injuries which justify a

substantial sanction. Therefore, the third Malone factor also weighs in favor of dismissal.

Finally, no less drastic sanctions would be effective. For the reasons stated above,

it is not possible to measure precisely the damage done to Focus. A monetary sanction

for actual damages other than attorney’s fees could not be measured with confidence. It

seems unlikely that Ms. Baker would pay such an assessment. Moreover, Focus has

submitted evidence that its proprietary information remained on Ms. Baker’s website for

at least a week after the court instructed her to remove it. Her defiance of the court’s

instructions and her disrespect for the judicial process suggest that lesser sanctions would

offer her insufficient deterrence for further misconduct.

 “When choosing among possible sanctions [pursuant to Rule 37], [a] district court

may consider the deterrent value of an order of dismissal on future litigants as well as on

the parties. Wyle, 709 F.2d at 590. Given the wilful and deliberate violation of the

protective order in this case, the court views dismissal as an appropriate sanction because

of the message it will convey to future litigants, as well as to Ms. Baker. Were the court

to permit this litigant to benefit from her actions, other litigants might view the potential

benefits of breaking a court order as outweighing the potential consequences. Therefore,

the court believes that dismissal is not only justified in this case, but necessary.

III. Other Motions

Ms. Baker’s other motions are unwarranted. Her Motion to Compel Compliance

With the Court’s 12/7/07 Order and for Sanctions Against Focus Receivables

Management LLC and its Attorney Cynthia Fulton (Doc. # 108) seeks sanctions related to

conduct for which the court has already sanctioned the Defendant. Defendant’s prior

delay in giving discovery was previously addressed at the December 7, 2007 hearing and

compensated by order of the court. There is no lawful basis for imposing additional

sanctions.

Ms. Baker also fails to provide any justifiable reason for granting her Motion to

Vacate the Confidentiality Order and to Make Public All Sealed Filings and Exhibits

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(Doc. # 112). Her argument that the filings in this case are a matter of public interest is

unavailing. Moreover, even if the court were to grant her request to vacate the

Confidentiality Order, it would not affect the disposition of her case. She violated a valid

and reasonable order of the court and her actions warrant dismissal of her suit.

IT IS THEREFORE ORDERED that Plaintiff’s Motion to Compel Compliance

With the Court’s 12/7/07 Order and For Sanctions Against Focus Receivables

Management LLC and its Attorney Cynthia Fulton (Doc. # 108), Plaintiff’s Motion to

Vacate the Confidentiality Order and to Make Public All Sealed Filings and Exhibits

(Doc. # 112), and the Defendant’s Motion to Strike (Doc. # 110) are DENIED.

IT IS FURTHER ORDERED that the Plaintiff’s Motion For Leave of Court to File

Memorandum in Opposition to Sanctions, Declaration and Exhibits Under Seal (Doc. #

106) is GRANTED.

IT IS FURTHER ORDERED that the Clerk seal the Affidavit and Attachment A

attached to the Defendant’s Motion for Sanctions (Doc. # 88) and the Affidavit and

Attachment A attached to the Memorandum of Law Regarding Sanctions (Doc. # 96).

IT IS FURTHER ORDERED that this action is dismissed with prejudice as a

sanction for Plaintiff’s violation of the Confidentiality Order (Doc. # 85). The Clerk shall

enter judgment DISMISSING this action with prejudice and shall terminate this action.

DATED this 26th day of February, 2008.

Case 3:06-cv-02927-NVW Document 113 Filed 02/26/08 Page 7 of 7