Opinion ID: 77297
Heading Depth: 3
Heading Rank: 1

Heading: Allocation Data

Text: 50 The district court held GM in civil contempt and sanctioned GM for its failure to obey the order of the court to produce File A, or monthly allocation, data from Chevrolet dealers in the Birmingham area, excluding Serra and Edwards Chevrolet, from January 1, 2001, until June 1, 2001. GM argues that the district court abused its discretion because (1) the data is not important and GM was justified for not retaining the information, (2) the district court made an important factual error, and (3) the issue is really one of spoliation, not violation of a discovery order. We agree that the district court abused its discretion for two reasons. 51 First, the finding of the district court that the production was deficient by six months is not fully supported by the record. BankAtlantic, 12 F.3d at 1048 (citation omitted). The district court ignored the admission by Serra that limited its misallocation claim to the period beginning April 16, 2001, when the state court litigation between Serra and GM ended. Serra stated that GM's acts and omissions after the state court litigation are the basis for its misallocation claim (emphasis added). Although the district court, in its January 28, 2004, order, permitted discovery on the misallocation of vehicles since 2001, Serra specifically limited its misallocation claim in an admission on June 2, 2004, almost three months before the August 27, 2004, hearing. The admission rendered irrelevant any allocation data from January 1, 2001, through April 16, 2001. See Fed. R.Civ.P. 26(b)(1). The production by GM, therefore, was deficient by six weeks of data, not six months. 52 Second, the district court misquoted the January 28, 2004, order that permitted discovery on certain outlined topics. The sanction order incorrectly stated that the court ordered discovery on GM's allocation of vehicles since 2001, when, in fact, the January 28, 2004, order permitted discovery on GM's misallocation of vehicles since 2001. The distinction between allocation and misallocation is material because the misallocation claim related to an alleged favoritism solely towards Edwards Chevrolet over Serra. 53 GM objected to the request by Serra for allocation data for other Chevrolet dealers. GM contended that the misallocation data in the discovery order required the production of only the allocation data for Serra and Edwards, not for other Chevrolet dealers in Birmingham. The January 28, 2004, discovery order did not foreclose that argument by GM and instructed the parties to seek assistance from the court if disputes arose. 54 After GM objected, Serra filed a motion to compel discovery, and GM lost the argument. On August 27, 2004, the district court ordered GM to produce the allocation data for all Birmingham dealers from January 2001 forward, but under the retention policy of GM, the data from January 2001 until June 2001 regarding other Chevrolet dealers in Birmingham had been destroyed. When ordered to produce the data on August 27, 2004, GM complied and produced all that it had — allocation data from June 2001 forward. GM could not produce what it did not possess. Although the destruction of the documents by GM may have required the district court to engage in a spoliation analysis under Alabama law, see Wal-Mart Stores, Inc. v. Goodman, 789 So.2d 166, 176 (Ala.2000), the district court abused its discretion when it held GM in civil contempt and imposed sanctions for the failure by GM to obey the order of the district court to produce documents GM did not possess. See Pesaplastic C.A., 799 F.2d at 1520 (A party held in contempt may defend his failure to obey a court's order on the grounds that he was unable to comply.). 55 We also note that the parties now agree that the spoliation issue is moot. After this appeal was filed, on September 2, 2005, GM filed in the district court a notice of production, which informed the district court that the allocation data, dated January 1, 2001, until June 1, 2001, thought to have been destroyed, had actually been retained by a third party. GM produced the data to Serra on September 1, 2005.