Court of Appeals of Indiana | Opinion 18A-PL-1351 | May 21, 2019 Page 1 of 23

MEMORANDUM DECISION

Pursuant to Ind. Appellate Rule 65(D), 

this Memorandum Decision shall not be 

regarded as precedent or cited before any 

court except for the purpose of establishing 

the defense of res judicata, collateral 

estoppel, or the law of the case.

ATTORNEYS FOR APPELLANTS

Robert L. Burkart

Jean M. Blanton

L. Katherine Boren

Evansville, Indiana

ATTORNEYS FOR APPELLEE

Jason M. Massaro

Indianapolis, Indiana

Robert S. Daniels

Daniels G. Kerns

Fishers, Indiana

IN THE

COURT OF APPEALS OF INDIANA

Bioconvergence, LLC and Alisa 

K. Wright, individually,

Appellants/DefendantsCounterclaimants,

v.

Kathryn S. Eddy,

Appellee/Plaintiff-Counterclaim 

Defendant.

May 21, 2019

Court of Appeals Case No.

18A-PL-1351

Appeal from the Marion Superior 

Court

The Honorable Gary L. Miller, 

Judge

Trial Court Cause No.

49D03-1211-PL-45456

Tavitas, Judge.
Court of Appeals of Indiana | Opinion 18A-PL-1351 | May 21, 2019 Page 2 of 23

Case Summary

[1] BioConvergence, LLC (“BioC”) and Alisa K. Wright (collectively, “the 

Defendants”) appeal the trial court’s entry of default judgment in favor of 

Kathryn S. Eddy (“Eddy”) and the trial court’s dismissal with prejudice of the 

Defendants’ counterclaim as discovery violation sanctions. We affirm in part 

and reverse in part.

Issues

[2] The Defendants raise the following issues:

I. Whether the Defendants were denied due process when the 

trial court found them to be in contempt based on Eddy’s 

unverified contempt motion.

II. Whether the trial court’s dismissal of Defendants’ 

counterclaims was an unjust discovery violation sanction.

III. Whether the trial court’s entry of default judgment was an

unjust discovery violation sanction.

Facts1

[3] This case involves a plethora of discovery disputes, violations, requests for 

contempt findings and sanctions, and gamesmanship that ensued after the 

employer-employee relationship of the parties soured. The relevant facts are as 

 

1 We heard oral argument of the parties on March 28, 2018. 
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follows: Wright is the majority owner and chief executive officer of BioC2

,

headquartered in Bloomington, Indiana. Wright’s ex-husband, Lance, was

BioC’s chief operating officer. In 2004, Eddy contracted to provide consulting 

advice to BioC and, in 2006, Eddy began serving on BioC’s board of advisors. 

[4] In December 2010 or January 2011, Eddy purchased 371.429 ownership shares

of BioC for $52,000.00, or $140.00 per share, the unit price that was designated 

by Defendants and approved by BioC’s accounting firm. In March 2011, Eddy

accepted a position as BioC’s chief financial officer. That Fall, Defendants 

tasked Eddy with performing a new stock valuation. Eddy concluded that the 

unit price of the ownership shares should be $70.00; however, Defendants

elected to maintain the $140.00 unit price. In December 2011, Eddy bought 

seventy-one more ownership shares at the $140.00 unit price. 

[5] In May 2012, Defendants terminated Eddy’s employment, which triggered 

BioC’s option to repurchase Eddy’s ownership shares pursuant to BioC’s 

operating agreement. In July 2012, Defendants repurchased Eddy’s ownership 

shares for $15.50 per share.

3 On November 27, 2012, Eddy sued Defendants

for actual and constructive fraud; breach of contract; breach of fiduciary duty;

criminal deception; defamation per se; defense and indemnification; specific 

performance; violations of the Indiana Uniform Securities Act; and willful 

 

2 BioC is a service provider to the life sciences industry and provides contract services, including 

development, production, testing, supply chain, and consulting services, to the pharmaceutical industry. 

3 Defendants aver that BioC’s accounting firm generated the $15.50 unit price pursuant to a new valuation. 
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misconduct and recklessness. On January 18, 2013, Defendants

counterclaimed for breach of contract; conversion; criminal deception;

defamation; intentional infliction of emotional distress; and negligence. 

[6] The discovery disputes at issue involve Eddy’s requests (1) for an executed

medical release from Wright for mental health records from the Wrights’ 

marriage counselor, Carol Bither; and (2) for non-party production of 

documents from Defendants’ expert witness, Gary Kleinrichert of FTI.

[7] On May 12, 2015, Eddy filed motions for orders to release Wright’s mental 

health records and to compel production of mental health records. Eddy 

argued that Wright “placed her mental health at issue [ ] by claiming [ ]severe 

emotional distress and mental anxiety”; and “any such records are crucial to 

Eddy’s defense of Wright’s Counterclaims[.]” Appellants’ App. Vol. V pp. 28, 

30. On July 30, 2015, the trial court ordered Wright to execute any necessary 

medical release forms within ten days. Wright failed to execute the release that 

Eddy’s counsel provided.

[8] On September 9, 2015, Eddy served a nonparty request for production of 

documents upon Bither and successfully obtained Bither’s notes. When Eddy 

subsequently sought to take Bither’s deposition, Bither’s counsel refused to 

allow Bither to testify because Wright had not executed a medical release. 

[9] On June 16, 2017, Eddy filed an unverified motion for contempt and sanctions

(“First Contempt Motion”) in which Eddy alleged that Wright violated the trial 

court’s July 30, 2015, order by failing to timely execute a medical release. On
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July 3, 2017, Wright responded4 that the trial court’s order: (1) required her to 

sign a medical release for Bither’s notes; (2) did not require her to sign a broad 

release for unlimited testimony; and (3) imposed no deposition obligation. 

[10] At the close of a final pretrial conference (“FPTC”) on July 10, 2017, Eddy 

supplied the trial court with a medical release form for Wright to sign. The trial 

court initialed the release and ordered Wright to sign it after the FPTC. Wright 

did not sign the release after the FPTC. Three days later, on July 13, 2017, 

Wright delivered to Eddy a signed, yet modified, version of the release that still 

bore the trial court judge’s initials.

5

 

[11] On July 14, 2017, the trial court, sua sponte, continued the trial for one year

and ordered the parties into mediation to resolve all pending issues. On July 

25, 2017, the trial court denied all pending motions stating, “[I]n the event 

mediation of the pending issues between the parties is unsuccessful, the parties 

may refile any requests they have.” Appellants’ App. Vol. X p. 143. After the 

trial court vacated the trial setting, Wright revoked her executed, modified

medical release. The parties met for mediation as scheduled; however, they did 

 

4 Wright also argued that the Bither deposition did not occur because Eddy failed to obtain a medical release 

from Lance as Bither requested. 

5 Defendants maintain that Wright merely filled out the medical release consent form that Wright was given; 

that the form had a blank space for the service recipient’s address, in which Wright entered her attorneys’ 

contact information, and a blank space designated for the purpose for which the released information was to 

be used, in which Wright entered “that the release was solely for the purposes of allowing for Bither’s 

deposition to be taken in this case, which was to be kept confidential pursuant to the trial court’s protective 

order.” See Appellants’ Br. pp. 23-24. Wright also included a warning “that any violations of the protective 

order by Eddy and/or her agents would be ‘prosecuted to the fullest extent of the law.’” Id.
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not settle all pending matters. In the meantime, Eddy continued to try to obtain 

a signed release from Wright. 

[12] After Defendants disclosed their expert witnesses, including Kleinrichert of 

FTI, Eddy served subpoenas on Defendants’ experts on January 31, 2017. 

Defendants objected on February 13, 2017. The experts’ responses to the 

subpoenas were due on March 6, 2017. On March 1, 2017, Defendants moved 

for a protective order to shield their experts, including FTI, from Eddy’s 

subpoenas. On March 15, 2017, Eddy filed a motion to compel non-party 

discovery on Defendants’ testifying experts, including Kleinrichert and FTI,

and a motion for leave to serve non-party discovery upon the testifying experts. 

[13] After a hearing on April 11, 2017, the trial court denied Defendants’ motion for 

protective order, granted Eddy’s motion to compel, and ordered Defendants’

testifying expert witnesses to produce the requested documents by April 26, 

2017 (“April 11, 2017 order”). FTI did not produce the documents on April 26, 

2017. Instead, counsel for FTI notified Eddy, in writing, that the trial court’s 

April 11, 2017 order did not require FTI to produce all responsive documents. 

[14] On May 1, 2017, FTI provided 2,500 responsive documents to Defendants for 

review; however, Eddy contends that FTI produced only a subset of those 

responsive documents because Defendants prevented FTI from making a full 

production. On May 11, 2017, counsel for FTI conceded that Eddy was 

entitled to the withheld documents. On May 15, 2017, Defendants filed a 

motion to determine compliance with the trial court’s April 11, 2017 order. 
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Defendants asked the trial court to find that BioC complied with the April 11, 

2017 order and that the remaining documents were “appropriately withheld.” 

Id. The trial court subsequently ordered that “all documents should be 

discovered,” with limited exceptions for privileged, proprietary, and 

confidential information. Appellants’ App. Vol. IX p. 165.

[15] On May 17, 2017, Eddy sought sanctions against Defendants for, among other 

things, improper interference with FTI’s compliance with the April 11, 2017, 

order. In motions filed on July 7 and July 10, 2017, Eddy moved to exclude 

Kleinrichert’s testimony, documents, opinions, or other evidence and moved to 

strike Kleinrichert and any documents produced by FTI from Defendants’

witness and exhibit lists. Thereafter, on February 9, 2018, Defendants

withdrew Kleinrichert as an expert witness. After mediation efforts failed, 

Defendants notified Eddy that the missing FTI documents would not be 

produced and stated that the documents were no longer relevant because 

Defendants had withdrawn Kleinrichert. 

[16] On February 23, 2018, Eddy filed another unverified contempt motion for 

sanctions (“Second Contempt Motion”), which encompassed the Bither and 

FTI discovery disputes.

6

 On May 3, 2018, the trial court conducted a hearing 

 

6 We refer to this contempt motion as the “Second Contempt Motion” to mirror the trial court’s amended 

order. As to the Bither dispute, Eddy alleged that Wright and BioC improperly altered a court order by 

modifying the court-initialled Bither release and flouted the trial court’s authority by subsequently revoking 

the release. As to the FTI dispute, Eddy alleged that Defendants improperly interfered with FTI’s 

compliance with the trial court’s April 11, 2017, order by failing to produce all responsive documents and by 

misrepresenting to the trial court that all responsive documents were produced. Eddy sought production of 

the omitted FTI documents, dismissal of Defendants’ counterclaim, and fees.
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on Eddy’s Second Contempt Motion and other pending motions. The trial 

court’s May 11, 2018, amended order provided, in relevant part:

2. Plaintiff’s First Motion for Sanctions was a request for 

contempt because Ms. Wright refused to honor this Court’s July 

30, 2015, Order that Ms. Wright execute a Release so as to allow 

the deposition of Ms. Bither to occur.

* * * * *

6. Instead of executing the Release as Ordered in Court, Ms. 

Wright refused to sign the release approved by the Court and 

instead, among other things, submitted a modified version 

despite the Release bearing the signature[7

] of the Judge, 

effectively altering a Court Order.

* * * * *

8. The Order continuing the trial date did not void all prior Orders 

of this Court, including the Order compelling Ms. Wright to sign 

the Release.

9. [ ] Wright is in contempt of this Court for [(i)] her failure to 

comply with this Court’s July 2015, Order and June 27, 2[017], 

Order, (ii) for [Wright]’s improper modification of the initialed 

Release, and (iii) the continued and blatant discovery abuses well 

documented in this case in the record.

* * * * *

 

7 The release at issue bore the trial court judge’s initials.
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12. In this case, Ms. Wright has continued to flaunt [sic] this 

Court’s authority by failing to comply with its Orders and her 

willful refusal to cooperate has caused delay in the parties[’] 

completing discovery and preparing this matter for trial.

13. Ms. Wright has been held in contempt on a prior occasion 

where the Court ordered her to comply and took the matter of 

attorney fees as a sanction under advisement. This did not deter 

her.

14. As a result of Alisa Wright’s contempt and the failure of other 

sanctions to force her to comply, the Court ORDERS judgment 

be entered against [ ]Wright, and for the Plaintiff, Kathryn Eddy 

on the Plaintiff’s complaint and further orders [ ] Wright’s 

counterclaim be dismissed with prejudice.

15. [BioC] is in contempt of this Court for its continuing failure 

to comply with the Court’s Order requiring the production of 

missing FTI documents.

* * * * *

17. As a result of the contempt and the failure of other sanctions 

to force [BioC] to comply, the Court ORDERS judgment be 

entered against [BioC], and for the Plaintiff, Kathryn Eddy on 

the Plaintiff’s complaint and further orders [BioC]’s counterclaim 

be dismissed with prejudice. [ ] 

Appellants’ App. Vol. II pp. 85-88 (emphasis in original). Defendants appeal.

Analysis

[17] Defendants argue that the trial court abused its discretion in dismissing their 

counterclaim with prejudice and entering default judgment in favor of Eddy as 
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discovery violation sanctions. “We assign the selection of an appropriate 

sanction for a discovery violation to the trial court’s sound discretion.” 

Whitaker v. Becker, 960 N.E.2d 111, 115 (Ind. 2012). “Trial judges stand much 

closer than an appellate court to the currents of litigation pending before them, 

and they have a correspondingly better sense of which sanctions will adequately 

protect the litigants in any given case, without going overboard, while still 

discouraging gamesmanship in future litigation.” Id. Accordingly, we review a 

trial court’s sanction only for an abuse of its discretion. Id. An abuse of 

discretion occurs when the trial court’s judgment is clearly against the logic and 

effect of the facts and circumstances. Clements v. Hall, 966 N.E.2d 757, 759 

(Ind. Ct. App. 2012), trans. denied.

I. Due Process 

[18] First, Defendants allege that the trial court improperly found them in indirect 

contempt based upon allegations in Eddy’s unverified contempt motion and, 

thereby, denied them due process of law. Civil contempt consists of failing to 

do something that a court in a civil action has ordered to be done for the benefit 

of an opposing party. Jones v. State, 847 N.E.2d 190, 199 (Ind. Ct. App. 2006) 

(citing Cowart v. White, 711 N.E.2d 523, 530 (Ind. 1999)). A party who has 

been injured or damaged by the failure of another to conform to a court order 

may seek a finding of contempt. Cowart, 711 N.E.2d at 530. 

[19] “A court’s inherent civil contempt powers are both coercive and remedial in 

nature.” S.W. ex rel. Wesolowski v. Kurtic, 950 N.E.2d 19, 22 (Ind. Ct. App. 

2011). In a civil contempt proceeding, the primary objective is not to punish, 
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but, rather, to coerce action or to compensate the aggrieved party. Cowart, 711 

N.E.2d at 530. Whether a party is in contempt is left to the discretion of the 

trial court. Id. We reverse a trial court’s finding of contempt only if there is no 

evidence or inferences drawn therefrom that support the contempt finding. Id.

[20] Defendants contend, and we agree, that the trial court found willful 

disobedience of the court’s orders, or indirect contempt, here. The trial court 

stated in its amended order that Defendants “fail[ed] to comply with [its] July 

2015, Order, and June 27, 2017, Order[.]” There are two types of contempt—

indirect and direct.8

 “Willful disobedience of any lawfully entered court order 

of which the offender had notice is indirect contempt.” Akiwumi v. Akiwumi, 23 

N.E.3d 734, 737 (Ind. Ct. App. 2014); see Ind. Code § 34-47-3-1; see also Ind. Tr. 

R. 37(B)(2)(d) (providing that a party’s failure to make or cooperate in 

discovery may be regarded as an act of indirect contempt).

[21] In cases of indirect contempt, it is well-settled that:

[B]oth the Fourteenth Amendment and provisions of the Indiana 

Code demand certain procedural safeguards upon an allegation 

of “indirect” contempt . . . . The Fourteenth Amendment 

requires, as a baseline, that the accused receive notice of the 

 

8 Direct contempt involves “actions occurring near the court that interfere with the business of the court, and 

of which the judge has personal knowledge.” Reynolds v. Reynolds, 64 N.E.3d 829, 832 (Ind. 2016), (citations 

omitted). “In cases of direct contempt, we accept as true the statement entered of record by the trial court; 

however, we examine the record to determine whether the acts recorded do, in fact, constitute contempt.” 

Hopping v. State, 637 N.E.2d 1294, 1295 n.1 (Ind. 1994) (citation omitted); see Holly v. State, 681 N.E.2d 1176, 

1178 (Ind. Ct. App. 1997) (affirming direct contempt finding where defendant directed profanity at trial 

court).
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contempt allegations against him and have a reasonable 

opportunity to defend against those allegations through a fair, 

public hearing that affords the right to counsel and the chance to 

testify and call witnesses. In Indiana, before indirect contempt 

proceedings may commence, the trial court must receive a 

verified information that sets forth the facts alleged to constitute 

contempt. I.C. § 34-47-3-5. Once the trial court has received a 

verified information, the court may then initiate further 

proceedings by issuing a rule to show cause. . . . .

Hunter v. State, 102 N.E.3d 326, 330 n.3 (Ind. Ct. App. 2018) (citations 

omitted).

[22] Indiana Code Section 34-47-3-5 provides:

(a) In all cases of indirect contempts, the person charged with 

indirect contempt is entitled:

(1) before answering the charge; or

(2) being punished for the contempt;

to be served with a rule of the court against which the contempt 

was alleged to have been committed.

(b) The rule to show cause must:

(1) clearly and distinctly set forth the facts that are alleged 

to constitute the contempt;

(2) specify the time and place of the facts with reasonable 

certainty, as to inform the defendant of the nature and 

circumstances of the charge against the defendant; and
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(3) specify a time and place at which the defendant is 

required to show cause, in the court, why the defendant 

should not be attached and punished for such contempt.

(c) The court shall, on proper showing, extend the time provided 

under subsection (b)(3) to give the defendant a reasonable and 

just opportunity to be purged of the contempt.

(d) A rule provided for under subsection (b) may not issue until 

the facts alleged to constitute the contempt have been:

(1) brought to the knowledge of the court by an 

information; and

(2) duly verified by the oath of affirmation of some officers 

of the court or other responsible person.

[23] It is undisputed here that Eddy’s various contempt motions were unverified. 

Defendants cite Indiana Bureau of Motor Vehicles v. Charles, 919 N.E.2d 114, 118 

(Ind. Ct. App. App. 2009) (“BMV”), for the proposition that “an unverified 

petition cannot serve as a basis for indirect contempt.”9 Appellants’ Br. p. 18. 

 

9 In BMV, after Charles’ driver’s license was suspended, she obtained a hardship license. At the time, the 

BMV required persons with hardship licenses to obtain high-risk insurance. The trial court waived the highrisk insurance requirement for Charles; however, BMV officials still required Charles to purchase high-risk 

insurance. Charles subsequently filed an unverified petition for rule to show cause that the BMV should be 

held in contempt for failing to honor the trial court’s order. After a hearing, the trial court found the BMV to 

be in contempt and ordered the BMV to reimburse Charles. Due to a procedural issue, the trial court vacated 

its initial contempt order; however, the trial court subsequently found the BMV to be in contempt.

On appeal, we concluded that: (1) the trial court found the BMV to be in indirect contempt; and (2) an 

unverified petition cannot serve as a basis for a rule to show cause. In support, we cited Indiana Code 

Section 34-47-3-5(d)(2) for the proposition that “an indirect contempt order may not issue until the facts 

alleged to constitute contempt have been ‘duly verified by the oath or affirmation of some officers of the court 

or other responsible person.’” BMV, 919 N.E.2d at 118 (quoting I.C. § 34-47-3-5(d)(2)). Our review of the 

record further established that neither party presented any witnesses, and the only admitted exhibit was a 
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We have previously held, however, that “not every technical requirement of the 

indirect contempt statute must be followed, so long as the contempt defendant’s 

due process rights are respected.” In re Contempt of Wabash Valley Hosp., Inc.,

827 N.E.2d 50, 63 (Ind. Ct. App. 2005). 

[24] Indiana Trial Rule 61 provides:

No error in either the admission or the exclusion of evidence and 

no error or defect in any ruling or order in anything done or 

omitted by the court or by any of the parties is ground for 

granting relief under a motion to correct errors or for setting aside 

a verdict or for vacating, modifying or otherwise disturbing a 

judgment or order or for reversal on appeal, unless refusal to take 

such action appears to the court inconsistent with substantial 

justice. The court at every stage of the proceeding must disregard 

any error or defect in the proceeding which does not affect the 

substantial rights of the parties.

[25] In Mariga v. Flint, 822 N.E.2d 620, 632-33 (Ind. Ct. App. 2005), trans. denied, a 

panel of this court held that failure to properly caption and verify a contempt 

petition did not affect the substantial rights of the parties. See In Re Paternity of 

J.T.I., 875 N.E.2d 447, 451 (Ind. Ct. App. 2007) (“Our courts have found . . . 

that strict compliance with the statute may be excused if ‘it is clear the alleged 

contemnor nevertheless had clear notice of the accusations against him or 

 

BMV employee’s affidavit alleging defective service. We found that, “[o]ther than the one exhibit, the 

transcript contain[ed] only argument from counsel . . . .” Id. at 117. We reversed and remanded, concluding 

that the trial court erred in making the contempt finding.
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her[.]’”); see also Reynolds v. Reynolds, 64 N.E.3d 829, 833 (Ind. 2016) (citing 

Stanke v. Swickard, 43 N.E.3d 245, 249 (Ind. Ct. App. 2015) (“[D]ue process is 

only denied when neither a court order nor a motion for rule to show cause 

contain sufficient factual detail about the allegations of contempt. Here, 

Defendants allege no denial of notice or the opportunity to be heard. We do 

not find that Wright’s substantial rights were affected by Eddy’s failure to verify 

her Second Contempt Motion. Any error from Eddy’s omission is harmless.

II. Discovery Violation Sanctions

[26] Next, we turn to Defendants’ contentions that the trial court imposed excessive 

discovery violation sanctions. “Trial judges stand much closer than an 

appellate court to the currents of litigation pending before them, and they have 

a correspondingly better sense of which sanctions will adequately protect the 

litigants in any given case, without going overboard, while still discouraging 

gamesmanship in future litigation.” Whitaker v. Becker, 960 N.E.2d 111, 115 

(Ind. 2012). Thus, we review a trial court’s sanction only for an abuse of its 

discretion. Id.

[27] As our Supreme Court has stated:

The purpose of the discovery rules is to allow for minimal trial court 

involvement and to promote liberal discovery. Although concealment 

and gamesmanship were [once] accepted as part and parcel of the 

adversarial process, we have unanimously declared that such tactics no 

longer have any place in our system of justice. Today, the purpose of 

pretrial discovery is to make a trial less a game of blindman’s 

bluff and more a fair contest with the basic issues and facts 

disclosed to the fullest practicable extent.
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In service of that goal, Indiana Trial Rule 37(B)(2)(c) expressly 

provides that a trial court may impose sanctions, including 

outright dismissal of the case or default judgment, if a party fails 

to comply with an order to compel discovery. As the U.S. 

Supreme Court has explained, the purpose of sanctioning

discovery violations is not merely to penalize those whose 

conduct may be deemed to warrant such a sanction, but to deter 

those who might be tempted to such conduct in the absence of 

such a deterrent.

Id. at 115 (emphasis added) (citations and quotations omitted). 

[28] A trial court has inherent power to maintain its dignity, secure obedience to its 

process and rules, rebuke interference with its conduct of business, and punish 

unseemly behavior. Wright v. Miller, 989 N.E.2d 324, 331 (Ind. 2013). 

Although discovery is designed to be self-executing, when the goals of the 

system break down, Trial Rule 37 provides the trial court with tools to enforce 

compliance. Hatfield v. Edward J. DeBartolo Corp., 676 N.E.2d 395, 399 (Ind. Ct. 

App. 1997). 

[29] Trial Rule 37(B) provides:

(B) Failure to Comply with Order.

(2) Sanctions by Court in Which Action is Pending. If a party . 

. . fails to obey an order to provide or permit discovery. . . , 

the court in which the action is pending may make such 

orders in regard to the failure as are just, and among others 

the following:

. . .
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(c) An order striking out pleadings or parts thereof, 

or staying further proceedings until the order is 

obeyed, or dismissing the action or proceeding or any 

part thereof, or rendering a judgment by default against 

the disobedient party;

. . .

In lieu of any of the foregoing orders or in addition thereto, the 

court shall require the party failing to obey the order or the 

attorney advising him or both to pay the reasonable expenses, 

including attorney’s fees, caused by the failure, unless the court 

finds that the failure was substantially justified or that other 

circumstances make an award of expenses unjust.

Ind. Trial Rule 37 (emphasis added).

A. Dismissal of Defendants’ Counterclaim

[30] Defendants argue that the trial court abused its discretion by dismissing their 

counterclaim as a discovery violation sanction because the trial court did not 

expressly warn them that it was considering these sanctions; and the trial 

court’s entry of dismissal was unjust.10 

 

10 Specifically, Defendants assert that: (1) “the trial court did not expressly warn [them] that failure to comply 

with any order might result in dismissal and/or default judgment”; (2) any court order that they violated was 

violated “based on reasonable, good-faith disputes regarding what was required”; (3) “[a] judgment of fraud, 

constructive fraud, securities fraud, and willful misconduct . . . may have far-reaching consequences . . .

which significantly affect [Defendants’] business operations”; (4) the sanction order would impose liability 

upon Defendants for a securities fraud claim that Eddy previously withdrew and now seeks to resurrect based 

upon the sanction order; (5) Defendants have legitimate defenses to Eddy’s claims, including Eddy’s 

admissions, pursuant to Defendants’ requests for admissions, that “directly contradict[ ]” Eddy’s claims; and 

(6) the potential damages award to Eddy in excess of one million dollars would adversely impact BioC’s 

business operations and “result in far greater losses.” Appellants’ Br. pp. 37, 38, 40, 41.
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[31] . . .[W]hile the trial courts generally “fashion progressive 

sanctions leading up to a dismissal or default judgment when it is 

possible to do so, imposing intermediate sanctions is not 

obligatory when a party’s behavior is particularly egregious.” 

Whitaker, 960 N.E.2d at 116; . . . Prime Mortg. USA, Inc. v. Nichols, 

885 N.E.2d 628, 649 (Ind. Ct. App. 2008) (quoting Charnas v. 

Estate of Loizos, 822 N.E.2d 181, 185 (Ind. Ct. App. 2005), trans. 

not sought ) (“In determining whether a sanction is just, we 

recognize that ‘[a]lthough a default judgment plays an important 

role in the maintenance of an orderly, efficient judicial system as 

a weapon for enforcing compliance with the rules of procedure 

and for facilitating the speedy determination of litigation, in 

Indiana there is a marked judicial deference for deciding disputes 

on their merits and for giving parties their day in court, especially 

in cases involving material issues of fact, substantial amounts of 

money, or weighty policy determinations.’” Additionally, we 

caution against an overly formulaic approach to determining 

when the behavior of a party or counsel warrants the drastic 

sanction of dismissal.

Wright, 989 N.E.2d at 327-28 (most internal citations and footnotes omitted).

[32] “When deciding whether a sanction is just, this court has routinely considered 

whether [the] offending party was afforded time to comply and understood that 

sanctions could follow for continuing failure to perform.” Prime Mortg., 885 

N.E.2d at 649 (affirming entry of default judgment as a discovery sanction

where defendant repeatedly failed to comply with orders regarding discovery 

and submitted a false document to the court); see id. at 650 (“Indeed, we have 

held that a sanction is not unjust when two conditions are met: ‘(1) the party in 

 
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question was given additional time within which to respond and was expressly 

warned in advance that an ultimate sanction would be entered if he failed to 

comply, and (2) no response or request for additional time was timely made and 

no reason excusing a timely response is demonstrated.’”). 

[33] It is well settled that a trial court may dismiss a matter outright (1) where a 

party fails to timely respond to discovery; (2) where a party violated the trial 

court’s order compelling discovery by failing to respond; or (3) where a party 

responded to discovery in an incomplete or misleading way. BMV, 919 N.E.2d 

at 116. Rule 41(E) allows for dismissal for failure to comply with the trial rules, 

which include the discovery rules. 

[34] As to the Bither deposition, the record here establishes that the trial court 

ordered Defendants to execute a medical release no less than three times; 

Defendants repeatedly showed disdain for the court’s authority; Defendants 

were undeterred by monetary sanctions; Defendants persisted in parsing the 

language of the trial court’s orders and debating if any of the trial court’s 

unequivocal orders regarding the Bither deposition actually ordered Defendants 

to comply; and, despite the trial court giving Wright numerous occasions to 

comply, the Bither deposition still had not occurred at the time of the hearing 

on Eddy’s Second Contempt Motion.11 

 

11We will not dignify Wright’s contention that Eddy and the trial court somehow failed to realize that Wright 

tendered a complying release nearly three years earlier. By this ruse, Defendants illustrated better than Eddy 

could the extent to which Defendants’ brinksmanship knows no bounds.
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[35] As to the FTI document production, the record establishes the following: (1) 

the trial court compelled Defendants to produce all documents responsive to 

Eddy’s FTI subpoena; (2) FTI provided Defendants with all responsive 

documents; (3) Defendants produced only a subset of the responsive FTI 

documents; (4) the trial court entered a second order compelling Defendants to 

produce all documents, except privileged documents, and found Defendants to 

be in contempt; (5) Defendants later represented, falsely, that all responsive FTI 

documents had been produced; and (6) counsel for Defendants subsequently 

notified FTI, in writing, that Defendants would not authorize FTI’s full 

compliance with the court’s order. Wright and BioC, thus, interfered with 

FTI’s compliance with the trial court’s order. Faced with Defendants’ blatant 

disregard of the trial court’s authority, and Wright’s sabotaging of multiple 

scheduled Bither depositions, and Defendants’ interference with FTI’s 

compliance with court orders, we find no abuse of discretion in the trial court’s 

dismissal of Defendants’ counterclaim as a discovery violation sanction. 

2. Entry of Default Judgment in Eddy’s Favor

[36] Next, we address the trial court’s entry of default judgment in favor of Eddy as 

a discovery violation sanction for Defendants’ conduct of discovery. A trial 

court may enter default judgment (1) where a party fails to timely respond to 

discovery; (2) where a party violated the trial court’s order compelling discovery 

by failing to respond; or (3) where a party responded to discovery in an 

incomplete or misleading way. BMV, 919 N.E.2d at 116; see Ind. R. 55 (“When 

a party against whom a judgment for affirmative relief is sought has failed to 
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plead or otherwise comply with these rules and that fact is made to appear by 

affidavit or otherwise, the party may be defaulted by the court.”).

[37] At issue here is not whether the trial court impermissibly entered default 

judgment as a discovery sanction pursuant to authority granted by Trial Rule 

37(B) but, rather, whether doing so was unjust.

In determining the appropriateness of default judgment as a 

discovery sanction, there is a marked preference in Indiana for 

deciding disputes on their merits, “‘especially in cases involving 

material issues of fact, substantial amounts of money, or weighty 

policy determinations.’” Wright v. Miller, 989 N.E.2d 324, 328 

(Ind. 2013) (quoting Charnas v. Estate of Loizos, 822 N.E.2d 181, 

185 (Ind. Ct. App. 2005)). Courts should not apply an “overly 

formulaic approach” in deciding whether to impose the “drastic 

sanction” of default judgment in the case of a discovery violation. 

If possible, trial courts should impose sanctions that have a 

minimal effect on the evidence presented at trial and should not 

impose sanctions at all if the circumstances indicate that 

sanctions would be unjust. We presume that a trial court will act 

in accord with what is fair and equitable in each case. 

Nagel v. Northern Indiana Public Service Co., 26 N.E.3d 30 39-40 (Ind. Ct. App. 

2015) (internal citations omitted).

[38] While we understand the trial court’s exasperation with Defendants’ discovery 

abuses, given well-settled Indiana authority, we nevertheless must take issue 

with its entry of the “drastic” default judgment sanction here inasmuch as the 

instant case involves (1) material issues of fact, (2) substantial amounts of 

money, and (3) “weighty policy determinations” and, therefore, is among the 
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cases that Indiana courts favor deciding on their merits. See id.; see also Wright,

989 N.E.2d at 328. 

[39] We initially note that Eddy did not request entry of default judgment as relief in 

her Second Contempt Motion. Moreover, we find persuasive Defendants’ 

contentions that the trial court’s entry of default judgment: (1) “entered 

judgment on claims for fraud, constructive fraud, securities fraud, and willful 

misconduct which may have serious consequences for BioC and [Wright]’s 

business operations”; (2) “impose[d] liability on [Defendants] for a [securities] 

claim that Eddy previously withdrew”; (3) “prevented [Defendants] from 

advancing their . . . legitimate defenses to Eddy’s claims”; and (4) pose[ ] 

“potential harm to BioC’s business operations” as the judgment could result in 

significant financial losses. Appellants’ Br. pp. 38, 39, 41. Further, the record 

does not support a finding that Defendants were expressly warned in advance 

that an ultimate sanction of default judgment would be entered if they failed to 

comply. See Prime Mortg., 885 N.E.2d at 650. 

[40] For these reasons, we deem the trial court’s entry of default judgment to be an 

unjust sanction as applied in this case; and we find that the trial court abused its 

discretion in imposing that “drastic sanction.” See Nagel, 26 N.E.3d at 39-40 

(“If possible, trial courts should impose sanctions that have a minimal effect on 

the evidence presented at trial and should not impose sanctions at all if the 

circumstances indicate that sanctions would be unjust.”). 
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Conclusion

[41] Despite the fact the contempt motion was unverified, Defendants were not 

denied due process. The trial court did not abuse its discretion in dismissing 

Defendants’ counterclaim as a discovery violation sanction but did abuse its 

discretion in entering default judgment. We affirm in part and reverse in part.

[42] Affirmed in part and reversed in part.

Baker, J., and Bradford, J., concur.