Opinion ID: 852125
Heading Depth: 1
Heading Rank: 4

Heading: Is This First-Party or Third-Party?

Text: In 2005, we addressed claims of spoliation in answering two certified questions from the United States District Court for the Southern District of Indiana. The questions were 1. Does Indiana law recognize a claim for first-party spoliation of evidence; that is, if an alleged tortfeasor negligently or intentionally destroys or discards evidence that is relevant to a tort action, does the plaintiff in the tort action have an additional cognizable claim against the tortfeasors for spoliation of evidence? 2. If so, what are the elements of the tort, and must a plaintiff elect between pursuing the spoliation claim and utilizing an evidentiary inference again the alleged tortfeasor in the underlying action? Gribben v. Wal-Mart Stores, Inc., 824 N.E.2d 349, 350 (Ind.2005). Our answers were limited to first-party spoliation, as distinguished from third-party spoliation, and we differentiated the types. First-party spoliation refers to the spoliation of evidence by a party to the principal litigation. Id. (citing Temple Cmty. Hosp. v. Superior Court, 20 Cal.4th 464, 84 Cal. Rptr.2d 852, 976 P.2d 223 (1999)). Third-party spoliation refers to spoliation by a non-party. Id. This seems to be the widely accepted view of spoliation, even among those courts which have chosen not to recognize independent spoliation claims of either type. See generally Lips v. Scottsdale Healthcare Corp., 224 Ariz. 266, 229 P.3d 1008 (2010) (Arizona does not recognize a cause of action for first-party spoliation of evidence or negligent spoliation of evidence); Martino v. Wal-Mart Stores, Inc., 908 So.2d 342 (Fla.2005) (appropriate remedies for a first-party spoliation claim are discovery sanctions and a rebuttable presumption of negligence for the underlying tort); Teel v. Meredith, 284 Mich.App. 660, 774 N.W.2d 527 (2009) (Michigan law does not recognize a cause of action for spoliation of evidence that interferes with a prospective civil action against a third party); Pikey v. Bryant, 203 S.W.3d 817 (Mo.App. 2006) (plaintiff's spoliation claim required more than the fact that potential evidence was intentionally destroyed); Timber Tech Engineered Bldg. Prods. v. Home Ins. Co., 118 Nev. 630, 55 P.3d 952 (2002) (no independent tort for spoliation of evidence regardless of whether it is committed by a first or third party); Metlife Auto & Home v. Joe Basil Chevrolet, Inc., 303 A.D.2d 30, 753 N.Y.S.2d 272 (N.Y.2002) (declining to recognize negligent third-party spoliation). Our decision in Gribben to forgo recognizing a distinct cause of action for first-party spoliation likewise comports with the approach of many courts that have instead addressed such allegations in the underlying litigation through sanctions, including adverse inference instructions and other mechanisms. See Cedars-Sinai Med. Ctr. v. Superior Court (Bowyer), 18 Cal.4th 1, 74 Cal.Rptr.2d 248, 954 P.2d 511, 517 (1998) ([T]here are a number of nontort remedies that seek to punish and deter the intentional spoliation of evidence. Chief among [which] is the evidentiary inference that evidence which one party has destroyed or rendered unavailable was unfavorable to that party.); see also Leon v. IDX Sys. Corp., 464 F.3d 951, 958, 960-63 (9th Cir.2006) (affirming dismissal against party for bad faith destruction of relevant evidence); cf. Ind. Trial Rule 37 (a court may sanction a party, including dismissal of a claim or defense, for failing to comply with a discovery order). Numerous federal decisions outline the purpose of such sanctions and the range available. The courts have recognized several purposes for imposing spoliation sanctions: If spoliation has occurred, the court should design sanctions to: (1) deter parties from engaging in spoliation; (2) place the risk of erroneous judgment on the party who wrongfully created the risk; and (3) restore `the prejudiced party to the same position he [or she] would have been in absent the wrongful destruction of evidence by the opposing party.' Consol. Edison Co. of New York v. U.S., 90 Fed.Cl. 228, 257 (Fed.Cl.2009) (quoting West v. Goodyear Tire & Rubber Co., 167 F.3d 776, 779 (2d Cir.1999)). Potential sanctions for spoliation include from least harsh to most harshfurther discovery, cost-shifting, fines, special jury instructions, preclusion, and the entry of default judgment or dismissal (terminating sanctions). Pension Comm. of Univ. of Montreal Pension Plan v. Banc of Am. Sec., LLC, 685 F.Supp.2d 456, 469 (S.D.N.Y. 2010) (footnotes omitted). In one widely cited opinion, the court explained that it would be difficult to come up with a detailed approach to sanctions that would apply in every case: Applying a categorical approach to sanctions issues is also difficult.... Determining whether sanctions are warranted and, if so, what they should include, requires a court to consider both the spoliating party's culpability and the level of prejudice to the party seeking discovery. Culpability can range along a continuum from destruction intended to make evidence unavailable in litigation to inadvertent loss of information for reasons unrelated to the litigation. Prejudice can range along a continuum from an inability to prove claims or defenses to little or no impact on the presentation of proof. A court's response to the loss of evidence depends on both the degree of culpability and the extent of prejudice. Even if there is intentional destruction of potentially relevant evidence, if there is no prejudice to the opposing party, that influences the sanctions consequence. And even if there is an inadvertent loss of evidence but severe prejudice to the opposing party, that too will influence the appropriate response, recognizing that sanctions (as opposed to other remedial steps) require some degree of culpability. Rimkus Consulting Group, Inc. v. Cammarata, 688 F.Supp.2d 598, 613 (S.D.Tex. 2010). Our decision in Gribben rested partly on similar analysis. In declining to recognize first-party spoliation claims we concluded, Notwithstanding the important considerations favoring the recognition of an independent tort of spoliation by parties to litigation, we are persuaded that these are minimized by existing remedies and outweighed by the attendant disadvantages. We thus determine the common law of Indiana to be that, if an alleged tortfeasor negligently or intentionally destroys or discards evidence that is relevant to a tort action, the plaintiff in the tort action does not have an additional independent cognizable claim against the tortfeasor for spoliation of evidence under Indiana law. Gribben, 824 N.E.2d at 355. We did acknowledge that fairness and integrity of outcome and deterrence might require a separate tort remedy against persons who are not parties to the principal litigation, but as the certified question did not necessitate examination of third-party spoliation, we did not address it further. The following year in Glotzbach v. Froman , we first considered whether an employee could sue his employer in tort, outside the Worker's Compensation Act, for loss of evidence about his injury on the job, evidence said to be needed for litigation against the maker of a pump that exploded at the worksite. 854 N.E.2d 337 (Ind.2006). We concluded the disadvantages in first-party spoliation militated against recognizing a third-party claim in that setting: Proving damages in a third-party spoliation claim becomes highly speculative and involves a lawsuit in which the issue is the outcome of another hypothetical lawsuit. The jury must somehow find all the elements of a product liability case, immediately determining whether a product defect caused the injury, as opposed to inadequate maintenance, or other intervening events. The jury would be asked to determine what the damages would have been had the evidence been produced and what the collectibility of these damages would have been. We think this exercise often could properly be described as guesswork. Id. at 341 (citing Petrik v. Monarch Printing Corp., 150 Ill.App.3d 248, 103 Ill.Dec. 774, 501 N.E.2d 1312, 1320 (1986)). Necessarily working from the background of Gribben and Glotzbach, and our observation that fairness and integrity of outcome might sometime require recognizing such a claim, the Gordons urge that theirs is an instance warranting an independent tort for third-party spoliation. The theory runs like this: when it comes time to prove the Gordons' claim against Dr. Gard, the Hospital's loss of medical records hinders their ability to pursue a claim against Dr. Gard. Thus, they say, the Hospital is a third party against whom a separate tort for spoliation is needed. The Hospital, of course, is also a first-party defendant. We conclude that splitting up the defendants, and the counts against them, blurs the distinction between actual defendants and others who may possess evidence but are not parties to the litigation. What the Gordons' case presents is really a claim for first-party spoliation, carrying the same advantages and disadvantages we weighed in Gribben and Glotzbach.