The opinion of the court was delivered by: Ronald Ellis, United States District Magistrate Judge
This action is one of several commenced by plaintiffs alleging large-scale counterfeiting of their branded products. Plaintiffs charge that defendants herein procured and supplied the infringing items. Declaration of Louis S. Ederer (hereinafter "Ederer Decl.") ¶ 2. Plaintiffs filed this action on October 25, 2000, and also filed a motion for a temporary restraining order, a preliminary injunction, and an order for expedited discovery. Ederer Decl. ¶ 11. Following a particularly protracted and contentious period of discovery, plaintiffs have now moved for sanctions against defendants Jay Enis ("Enis"), MHK Products, Inc. ("MHK"), and Transfund Capital, LLC ("Transfund") (collectively, the "Enis Defendants"), and against their attorneys, Shapiro & Shapiro ("Shapiro"). Plaintiffs allege that the Enis Defendants, aided and abetted by Shapiro, made a concerted effort to conceal their involvement in the challenged counterfeiting activities. Specifically, plaintiffs allege that:
[T]he Enis Defendants and Shapiro have failed to
comply with their obligations under the Federal Rules
of Civil Procedure and the direct orders of the
Court. Despite the fact that the Enis Defendants
orchestrated the manufacture of unauthorized Nike and
adidas products, they deliberately chose to conceal
their activities by submitting false affidavits,
testifying falsely, and wrongfully denying Plaintiffs
the right to review any documentation relating to
their counterfeiting enterprise. Exacerbating
matters, and consequently the expense to Plaintiffs,
was Shapiro, which at every turn, attempted to block
Plaintiffs' attempts to uncover the truth through
threats of sanctions, baseless objections and
requests for protective orders, as well as
affirmative misrepresentations made to Court
regarding the Enis Defendants' conduct.
Plaintiffs' Memorandum of Law in Support of Motion for Sanctions and Costs ("Pl. Mem."), at 2.
Plaintiffs seek in their motion "1) an order requiring the Enis Defendants and/or Shapiro to reimburse plaintiffs the costs and expenses incurred as a result of their misconduct; 2) an order requiring the Enis Defendants and/or Shapiro to pay the attorney's fees expended by Plaintiffs as a result of their misconduct; 3) an order striking the Enis Defendants' answer and a judgment on liability against the Enis Defendants; and 4) an order sanctioning Shapiro for its abusive dilatory conduct." Id.
Plaintiffs seek sanctions against the Enis Defendants pursuant to Rules 37(a), (b) and (c) of the Federal Rules of Civil Procedure, and sanctions against Shapiro under Rules 11 and 37 of the Federal Rules of Civil Procedure, and 28 U.S.C. § 1927. Plaintiffs also invoke the inherent power of the Court to punish abusive conduct by parties or their counsel.
For the reasons which follow, the Court finds that Jay Enis and his counsel, Shapiro & Shapiro have engaged in practices which have violated the Federal Rules of Civil Procedure and 28 U.S.C. § 1927. For those violations the Court imposes the following sanctions:
(1) the Enis Defendants will pay the plaintiffs the reasonable attorney's fees and costs associated with the depositions of
(2) the Enis Defendants will pay the plaintiffs the reasonable attorney's fees and costs associated with the instant motion for sanctions;
(3) the firm of Shapiro & Shapiro will pay the plaintiffs the reasonable attorney's fees and costs associated with the reply memorandum on the sanction motion;
(4) the Enis Defendants are precluded from introducing evidence on the issue of damages;
(5) the plaintiffs will be given all reasonable inferences against the Enis Defendants on the issue of damages.
A. The Involvement of Jay Enis with Nike and Adidas Products
On November 14, 2000, District Judge Kimba Wood entered a temporary restraining order, which was subsequently converted into a preliminary injunction and an order for expedited discovery on November 17, 2000. Orders dated November 14 and 17, 2000, attached as Ederer Decl., Exhs. D, E. Among other things, the order for expedited discovery provided:
(D) that Plaintiffs shall have expedited discovery of
Defendants as to all the facts and circumstances
surrounding Defendants' manufacture, purchase, sale,
offering for sale, financing, advertising, promotion
and distribution of goods bearing Nike and adidas
trademarks, including, but not limited to, the
following: a full and complete accounting of Nike and
adidas goods manufactured, purchased, offered for
sale, sold or distributed; documents reflecting
Defendants' manufacture, purchase, sale, offering for
sale, advertising, promotion and distribution of
goods bearing Nike or adidas trademarks;
identification of the persons responsible for the
manufacture or purchase of the Nike and adidas goods;
samples of each type or style of Nike and adidas
sporting goods, apparel, or accessories manufactured,
purchased and sold by Defendants; and any computer
records or electronic data, relating to Defendant's
manufacture, purchase, distribution, offering for
sale, sale, import, export, financing, advertising or
promotion of any Nike or adidas goods;
(H) Defendant shall provide sworn statements to
Plaintiffs' counsel by 12 noon on Tuesday, November
21, 2000 as to any inventory of adidas or Nike goods
in their possession, custody or control, or as to any
transactions in adidas or Nike goods currently in
process or which are not completed, whether
defendants are involved in such transactions as
broker or principal;
(I) Defendants shall produce to Plaintiffs' counsel
and all other counsel who have appeared in this
action, by 12 noon Tuesday, November 21, 2000, copies
of any transactional documents and correspondence
relating to any transactions in Nike are adidas goods
in which they have been involved either as broker or
principal beginning January 1, 1998 to the present;
(L) Defendants, by their principals Rosner, Sahaya,
Militano and Enis, shall appear for deposition by
Plaintiffs during the week of November 27, 2000.
Order dated November 17, 2000, Ederer Decl., Exh. E. Judge Wood thereupon referred the case to the undersigned to supervise discovery.
One of the defendants, Jay Enis, produced no documents pursuant to Judge Wood's expedited discovery order, and did not indicate that his companies were in any way involved with making or distributing Nike or adidas products, or that any of his companies was even in the business of making or selling apparel products. In a declaration signed on November 20, 2000, he stated that one of his companies, MHK, was "engaged in the business of manufacturing and selling promotional specialties to mercantile and various other organizations." Ederer Decl., Exh. F. He asserted that another of his companies, Transfund, was "engaged in the business [sic] providing financing for companies engaged in the manufacturing and selling of all types of merchandise." Id. He swore that he had no "knowledge of any transactions in Adidas or Nike goods which are currently in process or which have not been completed," and that he did not have "any transactional document and/or correspondence relating to any of the transactions with Nike or Adidas which are the subject of this litigation." Id. At a conference before the Court on November 22, 2000, plaintiffs complained about Enis's response in general, and specifically questioned his use of the phrase "subject of this litigation" because the expedited discovery order required disclosure of transactions "beginning January 1, 1998 to the present." For his part, Enis protested that he was not a proper party to the lawsuit. He did, however, provide a supplemental declaration dated December 14, 2000, in which he stated that he had "no documents reflecting any involvement in Adidas or Nike transactions beginning January 1998." Ederer Decl., Exh. I.
On December 5, 2000, plaintiffs deposed Enis pursuant to Judge Wood's discovery order. Among the things testified to by Enis at his deposition were: (1) he had only provided "financing" for a series of transactions involving Nike and adidas t-shirts; (2) his company, MHK, only provided promotional products for other companies and did not manufacture these items; (3) MHK's screen-printing facility in Hackensack, New Jersey, could only handle "small runs" or limited quantities of t-shirts. Ederer Decl. ¶ 20.
Plaintiffs did not believe that Enis had testified truthfully. In a letter to the undersigned dated December 18, 2000, plaintiffs asserted that testimony given in deposition by Enis and co-defendant Mark Sahaya had demonstrated that Enis had been involved in significant deals of Nike products during the relevant time period, and asked the Court to order Enis to appear for a continuation of his deposition:
Mr. Enis was deposed, pursuant to Judge Wood's Order
for Expedited Discovery, on December 5, 2000. At his
deposition, Mr. Enis testified that the Enis
Defendants had financed the purchase of between
800,000 — 1,000,000 units of Nike t-shirts by a
company known as World Apparel Products from the
defendant Rosson Sport (although Mr. Enis claimed
that he did not know the t-shirts contained Nike
trademarks). Mr. Enis further testified that the Enis
Defendants are still owed $1.8 million by World
Apparel for these shirts. The shirts in question have
been identified as counterfeit. Moreover, at the
deposition of co-defendant Mark Sahaya held on
December 13, 2000, Mr. Sahaya testified that the Enis
Defendants had also financed an earlier transaction
in 1999 involving 500,000 Nike t-shirts, some or all
of which are also alleged to be counterfeit.
Letter from Louis Ederer to Court, dated December 18, 2000 (Ederer Decl., Exh. K).
Enis argued that plaintiffs had mischaracterized the deposition testimony, and again complained that plaintiffs had improperly named him as a defendant:
It is respectfully submitted that this course of
conduct has been pursued by the plaintiffs with the
sole purpose of harassing our clients. Mr. Ederer's
attempt to impress his clients should not occur at
the expense of innocent bystanders. The plaintiffs
Nike and adidas, who are often the victims of lawless
counterfeiters, have extended their deep-pocketed
tentacles on a fishing expedition in hope of catching
violators. The expedited EBTs were ordered by the
Court in order to quickly see if parties like our
client Mr. Enis were innocent victims of an overbroad
sweeping complaint or true counterfeiters. The EBTs
of all of the parties to date have not produced an
iota or scintilla of evidence even remotely
connecting Jay Enis to the sale, purchase or
production of counterfeit goods, and certainly not to
the inflammatory remarks and allegations in Mr.
Ederer's letter. If such harassment continues, we
intend to exercise our right to move the Court to
impose the appropriate sanctions against plaintiffs
based upon said frivolous and harassing conduct.
Letter from Saadia Shapiro to the Court, dated January 4, 2001 (Ederer Decl., Exh. M).
By letter dated January 16, 2001, Shapiro reiterated the assertion that plaintiffs were engaged in a witch-hunt:
I once again urge you to reconsider pursuing Mr. Enis
in this action. His involvement in the transactions
alleged in the complaint are even less than those of
a bank or investment capital fund. As you can see
from the transcript of the depositions, not only with
Mr. Enis not involved in the transactions themselves,
he didn't even finance these transactions, and as
stated his usual business is one of financing
transactions for other parties in need of funds. In
this case Mr. Enis simply purchased postdated checks
(from World Apparel to Roson Sport) as commercial
paper at a discount. Mr. Enis was a financier of
commercial paper, and these depositions have shown
nothing to prove otherwise.
Letter from Saadia Shapiro to Louis Ederer, dated January 16, 2001, Ederer Decl., Exh. 0.
While the testimony elicited up to this point did not clearly show Enis's role in the transactions at issue, it did indicate that Enis had knowingly been involved in transactions with other defendants in this lawsuit. Notwithstanding these obvious links to the subject transactions, Enis continued to argue that there was no reasonable basis to have, or keep, him in the case. The Court declined to issue an order to compel the production of documents, as plaintiffs had not demonstrated that Enis actually possessed, or was in control of, any relevant documents. The Court, however, did allow plaintiffs to conduct additional discovery to explore whether Enis's representations concerning his role in the counterfeiting schemes were false.
Plaintiffs spent a significant part of the next year gathering evidence from third parties in an attempt to show that the Enis Defendants were not innocent bystanders swept up in an overbroad discovery net cast by plaintiffs, but major players at the center of a multi-million dollar counterfeiting enterprise involving adidas and Nike goods. Ederer Decl. ¶¶ 34-73. Enis continued to complain about improperly being made a party to this lawsuit.
On November 15, 2001, plaintiffs presented the Court with their accumulated evidence, and renewed their request to re-open the Enis deposition. Ederer Decl. ¶ 74. This evidence included:
a. David Jurrist, account manager for Perfect
Courier, a shipping and warehousing company in
Brooklyn, testified that he had picked up two to
three million Nike or adidas t-shirts from MHK
(Ederer Decl., Exh. HH, p. 23, lines 4-13);
b. Andrew Cancel, a truck driver for Perfect Courier,
testified that he had made approximately 150 pickups
of Nike and adidas t-shirts at the MHK facility in
Hackensack between 1998 and 2000 (Ederer Decl. Exh.
II, p. 24, lines 4-11), and that he had observed Nike
and adidas t-shirts being screen-printed and packed
into boxes during each of these pickups (Id. p. 21,
line 7 to p. 22, line 7);
c. Thomas Parker, a partner of Volunteer Knit
Apparel, Inc. ("Volunteer"), testified that his
company manufactured "blank" Nike t-shirts for
approximately three years, shipped them to the
Hackensack facility, and Enis paid for the them
(Ederer Decl., Exh. NN, p. 31, line 23 to p. 33, line
d. Paul Owenby, owner of The Owenby Company
("Owenby"), testified that his company manufactured
Nike and adidas products for approximately three
years, and that these products were shipped to, and
paid for by, Enis. Ederer Decl, Exh. LL, p. 32, line
19 to p. 32, line 9).
In addition, plaintiffs secured bank records of Enis's companies which showed millions of dollars in payments to Volunteer and Owenby, Ederer Decl., Exh. W, and more than a thousand pages of transactional documents from the third-party witnesses, many of which were transactional documents relating to the adidas and Nike goods manufactured for and shipped to the Enis Defendants.
Based on this evidence, plaintiffs requested an order compelling Enis to appear for a continued deposition, and compelling the Enis Defendants to produce information regarding the location of former MHK warehouse manager, Billy Wilson ("Wilson"). In early December 2001, plaintiffs supplemented this application by seeking leave to take the deposition of a recently discovered label manufacturer named Sandora Industries, Inc. ("Sandora"), which plaintiffs believed had been engaged by Enis to create Nike and adidas neck labels and hangtags for counterfeit garments. Ederer Decl. ¶ 77.
After receiving these submissions, and following a hearing on December 10, 2001, the Court determined that Enis had acted in significant ways apart from mere financing, and had been implicated in transactions challenged in this action, and therefore ordered him to appear for a continuation of his deposition. The Court also granted plaintiffs leave to take the deposition of Sandora, instructed Enis to produce any documents in his possession relating to Nike and adidas goods and any information which would assist plaintiffs in locating Wilson.
Plaintiffs thereupon took the deposition of Neil Drori, president of Sandora, on January 11, 2002. Drori testified that Enis had personally ordered the manufacture of millions of Nike and adidas t-shirt labels, that Enis had provided the samples, and approved the specifications; that the labels and hang tags were shipped to MHK and Volunteer; and that these items were billed to, and paid for by, MHK. Drori also testified that he had visited the MHK facility in Hackensack, New Jersey, and witnessed the screen printing of large quantities of Nike and adidas t-shirts.
At his continued deposition on January 24, 2002, Enis painted a remarkably different picture from that set forth in his declarations and his prior deposition. Among other things, he admitted that:
a. He personally ordered millions of Nike and adidas
labels and hang tags from Sandora (Deposition of Jay
Enis, dated January 24, 2002 (Ederer Decl., Exh. XX)
[hereinafter, "Enis 2002 Dep."], p. 18, lines 15-25);
b. He personally supplied Sandora with sample Nike
and adidas labels and hang tags and instructed
Sandora to duplicate them (Id., p. 20, line 14 to
p. 21, line 25; p. 33, lines 10-19);
c. He personally required Sandora to send
pre-production samples of the labels and hang tags
back to him so that they could be compared with what
he had sent (Id., p. 21, line 10 to p. 22, line 8);
d. He personally directed that the Nike and adidas
labels and hang tags produced by Sandora be shipped
to the MHK facility in Hackensack, New Jersey, or
directly to Volunteer (Id., p. 18, lines 14-22; p.
45, lines 3-25);
e. He took delivery in Hackensack directly from
volunteer and Owenby of "blank" Nike and adidas
t-shirts with the Sandora labels sewn into the
garments (Id., p. 63, lines 6-8; p. 64, line 10 to
p. 66, line 7);
f. At the MHK facility in Hackensack, he
screen-printed Nike and adidas logos onto the
t-shirts which he received from Volunteer and Owenby,
(Id., p. 77, lines 5-21);
g. He attached the hang tags produced by Sandora to
the screen-printed t-shirts at the MHK facility in
Hackensack (Id., p. 125, lines 1-6)
With respect to his failure to produce any documents relating to these transactions that had been produced by third parties, Enis testified and provided a sworn affidavit stating that "[s]ometime prior to June 2000, the MHK premises had a major roof leak and many of the papers in its offices became wet and were discarded." Ederer Decl., Exh. YY.
B. The Bill Wilson Deposition
In a typical case, the deposition of Bill Wilson would have been a minor issue, perhaps even an unnecessary expenditure of discovery resources. It assumed a heightened status, due in large part to Enis's representation that he had ceased being actively involved with MHK since about 1999, and that Wilson was responsible for the day-to-day operations at the facility. The parties have different recollections about the history of this dispute, but the situation began to gain momentum when, on March 16, 2002, plaintiffs' counsel faxed a notice to depose Wilson to Shapiro. Ederer Decl., Exh. X. Shapiro objected to the form of notice and the date selected for the deposition:
Reference is made to your facsimile transmission
dated March 16, 2001, which contained a Notice of the
Deposition of Bill Wilson. Please be advised that we
have not consented to service of documents in this
manner via facsimile and do not accept such service.
With respect to any deposition of our clients in this
matter, April 6, 2001 is the eve of the holiday of
Passover and the attorneys from our office, as well
as our client, are not available on that day. Please
contact our office to discuss scheduling the
deposition at a mutually convenient date and time
before April 5 or after April 17, 2001.
Facsimile letter from Debbie Z. Benasaraf to John Maltbie, dated March 26, 2001 (Ederer Decl., Exh. Y). On the same day as the fax, counsel for plaintiffs contacted Shapiro and the deposition was rescheduled to April 4, 2001. Ederer Decl., Exh. Z. Three days later, Shapiro again complained to the Court:
Shortly after this matter was commenced in or about
November, 2000, the Court ordered expedited discovery
in this matter since the Court was sensitive to the
fact that the temporary restraining order would have
a profound impact on the ability of the defendants to
run their businesses. Depositions of the defendants
were taken documents were produced, however, this
process has been anything but expedited; it has been
ongoing for over four months. Plaintiffs have been
permitted to proceed on a veritable unfettered "witch
hunt" and fishing expedition against the defendants,
including my clients, during that time, and
throughout the discovery plaintiffs have not come up
with a "smoking gun" which involves my clients are
anything substantive at all to support their case
against my clients in this matter. (emphasis in
Letter from Saadia Shapiro to Court, dated March 29, 2001 (Ederer Decl., Exh. AA). It is not clear from the record exactly what happened during the next few months, but Shapiro subsequently agreed to schedule the deposition for September:
We have consulted with our client, and September 12,
13 or 14, 2001 have been proposed as dates for the
deposition of Bill Wilson. Please get [sic] choose
one of these dates and get back to us so that we may
schedule the deposition.
Facsimile letter from Debbie Z. Benasaraf to John Maltbie, dated August 14, 2001 (Ederer Decl., Exh. CC). As occurred in March, Shapiro wrote the Court shortly after the deposition was scheduled to complain about the course of discovery:
This firm was discouraged that "expedited discovery"
had turned into an over eight month process with no
conclusion to discovery set by the Court and this
surely was not the intention of Judge Wood. During
the conference, counsel for plaintiffs expressed that
all that remains for their discovery to be complete
was the deposition of Bill Wilson, one of the
employees of MHK Products, and possibly one other
deposition. The Court ordered that the deposition of
Bill Wilson could take place but that no other or
further discovery could be conducted absent further
application to the Court.
Letter from Saadia Shapiro to Court, dated August 28, 2001 (Ederer Decl., Exh. DD). The plaintiffs responded in kind:
Mr. Shapiro conveniently neglects to mention in his
letter that immediately after the July 12 conference
call, plaintiffs proceeded to notice the depositions
of all parties they had intended to pursue after
Wilson's deposition had been completed. On July 24,
2001, this office sent notices of deposition via
Federal Express to opposing counsel for the
depositions of Perfect Courier, Volunteer, Owenby,
Volunteer [sic], and Y-Z and Complete, as well as
another related Florida entity, HYZ Enterprises, and
an officer of the related Florida entities, David
Mr. Shapiro did not comply with the court's order to
provide dates for the deposition of Wilson until
August 14, 2001, when he offered Wilson for
deposition on September 12, 13, or 14, 2001. Further,
directly contradicting Mr. Shapiro's letter, on
August 15, 2001 plaintiffs informed Ms. Benasaraf,
that plaintiffs would take the deposition of Wilson
on September 14, 2001. For this entire period, July
25, 2001 to August 28, 2001, Mr. Shapiro never
objected to the taking of any of these depositions.
Mr. Shapiro raises these objections at this late date
only because he desperately wishes to conceal the
true nature of his clients' involvement in a
counterfeiting scheme of massive proportions. Based
on what plaintiffs now though, and what we believe
will be demonstrated in the depositions, defendants
MHK and Enis were instrumental to this scheme.
Letter from Louis Ederer to Court, dated September 4, 2001 (Ederer Decl., Exh. EE). Shapiro asserted that the plaintiffs had failed to confirm a date for the deposition:
Furthermore, despite Mr. Ederer's claims, his office
never attempted to confirm the date for Wilson's
deposition until the September 4, 2001 letter to the
Court. This office provided three dates for Wilson's
deposition on August 14, 2001. Although other
deposition were confirmed, the plaintiffs never chose
a date for the Wilson deposition, despite a repeated
verbal request by Debbie Benasaraf to John Maltbie of
Gursky & Ederer on August 15, 2001 to schedule the
Letter from Saadia Shapiro to Court, dated September 6, 2001 (Ederer Decl., Exh. FF). Despite these professed attempts to schedule the Wilson deposition, Shapiro revealed in November that they did not know where Wilson was, and that Enis had had no communication with him since late July, or early August:
It is patently scandalous that you that you
[sic] have managed to so completely twist the facts
so as to distort the truth of this matter in a
blatant attempt to position yourself to seek yet
another extension of discovery from the Court. The
fact is, that in late Spring of 2001, due in part
to the injury to its reputation perpetrated by your
client through this litigation, MHK Products was
forced to cease its operations and terminate all of
its employees. At the time, MHK was operating with
a skeleton staff, with Bill Wilson running its
office. As you are also where, years earlier, our
client Mr. Enis moved to Florida and no longer was
involved in the day to day operations of MHK on its
premises. Nevertheless, notwithstanding that all
employees of MHK including Mr. Wilson, had been
discharged, as Mr. Enis was aware of the subpoena
served by your firm, he undertook to prevail upon
Mr. Wilson to comply and attend.
Unfortunately, since shortly after our last
communication regarding scheduling dates for the
deposition in late July, early August of this year,
Mr. Wilson has rebuffed and evaded all attempts by
Mr. Enis to communicate with him, regarding this or
any other matter, despite Mr. Enis's diligent
efforts to do so. Mr. Enis has advised us that he
did not handle employee records of MHK, that task
for by Mr. Wilson, and that he does not have access
to any of these records in Florida.
Letter form Debbie Z. Benasaraf to John Maltbie, dated November 14, 2001 (Ederer Decl., Exh. GG) (emphasis in original). Enis subsequently testified at his deposition in January 2002 that he had not spoken to Wilson in six to nine months, that he had no phone number for Wilson, and that he was not sure where Wilson lived. Enis 2002 Dep., p. 107, line 3 to p. 109, line 20.
C. The Enis Defendants' Position
The Enis Defendants assert that there is no basis for sanctions against either them or Shapiro:
In the case at bar, the facts of this matter do not
at all point to an award of sanctions either against
the Enis Defendants or the law firm of Shapiro &
Shapiro. As set forth at length in the Enis Affidavit
and the Shapiro Declaration, there was absolutely no
violation of any order of this Court regarding
discovery as Mr. Enis maintains, until this very day,
that there were no documents within his custody or
control which should have been produced which were
not produced. In addition, Mr. Enis maintains that
the affidavits he submitted in connection with this
matter were all true, and that he did not make any
knowingly false statements in either of his
depositions. The plaintiffs have not proven and
cannot prove otherwise.
Enis Defendants' Memorandum of Law in Opposition to Motion for Sanctions and in Support of Cross-Motion for Sanctions, at 6 (emphasis in original). They maintain that (1) Enis had no documents to produce; (2) Enis made no knowingly false statements in his affidavits or in his depositions; and (3) Shapiro did not act in any manner inconsistent with the Federal Rules of Civil Procedure. Indeed, the Enis Defendants argue that sanctions are warranted against plaintiffs' counsel for filing a motion for sanctions. According to Shapiro,
Upon information and belief, based upon the
foregoing, it seems that their motion for sanctions
was made in order to further harass the Enis
Defendants, in violation of Rule 1(b). Unless the
Ederer firm is willing to withdraw the motion for
sanctions, such should subject the Ederer ever firm
to sanctions, including, but not limited to, the
costs and attorneys fees of the Enis Defendants in
defending the motion for sanctions and bringing the
cross-motion for sanctions against the ever firm.
Id. At 13.
A. Applicability of Rule 37(a)
Federal Rule of Civil Procedure 37(a) provides that "[i]f a party fails to make a disclosure required by Rule 26(a)," or provides "an evasive or incomplete disclosure, answer or response," "any other party may move to compel disclosure and for appropriate sanctions." FED. R. Civ. P. 37(a)(2)(A), 37(a)(3). "If the motion is granted . . . the court shall . . . require the party or deponent whose conduct necessitated the motion or the party or attorney advising such conduct or both of them to pay to the moving party the reasonable expenses incurred in making the motion, including attorney's fees. . . ." FED. R. CIV. P. 37(a)(4)(A).
Plaintiffs point to three alleged failings by Enis which justify sanctions under this provision of the Rules: (1) he did not provide any documentary evidence of his transactions with Nike or adidas goods; (2) he did not provide accurate and complete responses in his November 20, 2000, and December 14, 2000 affidavits; and (3) he did not testify truthfully and completely in his December 5, 2000 deposition regarding his involvement in Nike and adidas products.
Plaintiffs allege that Enis knew that he had been less than candid in his declarations concerning the existence of documents, and that his deposition testimony was false. Plaintiffs assert that, rather than acknowledging his true role in the challenged transactions, Enis sought to conceal his ...