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Renner v. Takeda Pharmaceuticals U.S.A. Inc.

United States District Court, D. Montana, Missoula Division

January 12, 2017

AUDREY M. RENNER, Plaintiff,
v.
TAKEDA PHARMACEUTICALS U.S.A. INC., Defendant.

          ORDER

          DANA L. CHRISTENSEN, CHIEF DISTRICT JUDGE.

         Plaintiff Audrey Renner (“Renner”) moves for sanctions against Defendant Takeda Pharmaceuticals U.S.A. Inc. (“Takeda”) alleging spoliation of evidence. Takeda opposes the motion. For the reasons explained below, the Court grants in part and denies in part Renner's motion.

         BACKGROUND

         Renner worked as a pharmaceutical sales representative for Takeda and its predecessor companies from April 2006 until May 2015. On May 15, 2015, Renner received a phone call from Takeda investigator Patrick Quillinan (“Quillinan”) and Takeda regional human resources manager Susan Glave (“Glave”). During this telephonic interview, Renner was confronted about several alleged inconsistencies in her work records regarding sales calls made to health care providers and other entries in her records. Quillinan asked Renner a series of questions about these inconsistences and Renner responded. Quillinan and Glaves took notes. Later that day, Takeda terminated Renner's employment. In a subsequent termination letter, Takeda stated Renner was discharged because she allegedly “failed to maintain accurate Company records” (Doc. 16-1 at 1.) Specifically, Takeda alleged that Renner had incorrectly entered the time and dates she met with the healthcare professionals in an attempt “to misrepresent [her] work activities on certain days.” (Id. at 2.) The letter then listed multiple perceived discrepancies in Renner's work history, including four office calls she made in March and April of 2015. The letter listed the names of four health care providers who were allegedly contacted by Quillinan. These health care providers allegedly told Quillinan that they were not in the office on the dates Renner said she had made the office calls and thus they could not have met with her. Upon determining that Renner's alleged misrepresentations violated Takeda employee policies, she was terminated.

         Renner alleges that her termination was pretextual and states that she was actually fired because she refused to engage in “off-label marketing.”[1] Renner argues that Takeda's basis for discharging her, i.e., misrepresenting the dates she met with health care professionals, was manufactured by Takeda in order to terminate her. As evidence that her discharge was pretextual, Renner states that she has contacted the four medical professionals that were allegedly out of the office when Renner visited and three of the four stated that they were at the office on the days in question.[2] The fourth medical provider stated that she was no longer in possession of her records and could not confirm whether she was in the office. However, all four provided signed affidavits averring that they never spoke with Quillinan or any other representative from Takeda.

         Quillinan, during his deposition, stated that he did not actually speak with the health care providers named in Renner's termination letter and, instead, spoke with their office managers or receptionists to confirm that the providers were out of the office. However, he could not remember the names of the people he spoke with or the specific dates he called. Quillinan further stated that it is good practice to record these types of details when conducting an investigation, but did not do so on this occasion. Quillinan did, however, take handwritten notes during these phone calls but destroyed these notes, as well as notes taken during Renner's May 15, 2015 interview, after he submitted his official report of the investigation to Takeda. Nevertheless, Quillinan steadfastly maintains that nothing in the notes were omitted from the final report. Quillinan said he completed his report on or about June 4, 2015, and destroyed the notes sometime between then and June 10, 2015, the day he was instructed by Takeda's legal department to retain all documents relevant to Renner's termination.

         Renner now argues in the underlying motion that Quillinan consciously and willfully destroyed his notes in an attempt to spoliate relevant evidence. In particular, Renner asserts that she has been materially prejudiced by the destruction of the notes because can no longer determine if there are inconsistences or errors between the notes and Quillinan's official report of the investigation. Renner also argues that she was prejudiced by the destruction of the notes taken during her May 15, 2015 interview because, like the previously discussed notes, she can no longer determine if there are inconsistencies between her memory of the interview and the version Quillinan reported to Takeda. Because these notes can no longer be reproduced, Renner moves for dispositive sanctions in the form of default judgment.

         DISCUSSION

         Under its inherent power to control litigation, a district court may impose sanctions for the spoliation of evidence. Leon v. IDX Systems Corp., 464 F.3d 951, 958 (9th Cir. 2006) (citing Anheuser-Busch, Inc. v. Natural Beverage Distributors, 69 F.3d 337, 348 (9th Cir. 1995)). However, sanctions may only be imposed if “a party knew, or reasonably should have known, that the spoliated evidence was potentially relevant to a claim.” Peschel v. City Of Missoula, 664 F.Supp.2d 1137, 1141 (D. Mont. 2009) (citing Glover v. BIC Corp., 6 F.3d 1318, 1329 (9th Cir.1993)). Generally, three types of sanctions exist for the spoliation of evidence: (1) dismissal of the claim of the party who is responsible for the spoliation; (2) the exclusion of evidence or witness testimony corresponding to the evidence destroyed; or (3) an adverse jury instruction. Kopitar v. Nationwide Mut. Ins. Co., 266 F.R.D. 493, 499-500 (E.D. Cal. 2010) (citing various opinions by the Ninth Circuit, Seventh Circuit, and United States Supreme Court).

         Importantly, dismissal or the entry of default, the most drastic sanction, requires a court to find “willfulness, fault, or bad faith” on the part of the party who destroyed the evidence. Leon, 464 F.3d at 958 (citing Anheuser-Busch, 69 F.3d at 348). Further, dismissal may also be appropriate if the destruction of the evidence “relates to the matters in controversy in such a way as to interfere with the rightful decision of the case.” United States v. Natl. Med. Enterprises, Inc., 792 F.2d 906, 912 (9th Cir. 1986) (citations omitted).

         A. Willfulness, Fault, or Bad Faith

         As discussed, the Court may only consider dismissal as an option if it finds that Quillinan destroyed his notes willfully or in bad faith, and if he knew or should have known that they were relevant to this case. There does not appear to be a dispute that Quillinan intentionally destroyed his notes sometime between June 4, 2015, the day he submitted his final report, and June 10, 2015, the day he was notified of the legal hold on Renner's employment file. Instead, Takeda is apparently taking the position that Quillinan lacked express notice of the litigation and merely followed ordinary company practices when he destroyed the notes.

         Renner disputes Quillinan's argument that he lacked notice of the legal hold and points to a May 29, 2015 letter that she, through counsel, sent to Takeda. This letter requested that all records and documents related to Renner's employment be maintained due to the potential for litigation. The letter also expressly stated that: “[a]ny deletion, alteration, or other modification or destruction of evidence pertaining to her employment will be treated as spoliation of evidence.” (Doc. 16-6 at 1.)

         Takeda acknowledges receipt of this letter but argues that in a corporation as large as Takeda, it takes several days for word of potential litigation to trickle down to the appropriate persons. However, this argument is undermined by a June 2, 2015 email sent by Glave, Takeda's human resources official, to Quillinan. In this email, Glave notifies Quillinan that Renner has retained counsel and is requesting her employment file. (Doc. 16-9 at 1.) Additionally, the next day, Sonali Das, Takeda's attorney, sent an email to Glave and Quillinan where she discussed how Montana law allows a disciplined employee to receive all records related to the discipline. She then specifically asked ...


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