When you think of sanctions, your mind probably
goes to Rule 11 of the Rules of Civil Procedure. But what about Rule
37(b)(2)? It says that:
if a party . . . fails to obey an order to provide or
permit discovery, . . . a judge of the court in which the action is
pending may make such orders in regard to the failure as are just . . . . In
lieu of any [such order] or in addition thereto, the court shall require
the party failing to obey the order to pay the reasonable expenses,
including attorney's fees, caused by the failure . . . .
Judge Murphy applied the teeth in Rule 37 to sanction two
of the parties -- Allison and Stathopoulos -- in
an Order this week in BOGNC v. Cornelius Self-Storage LLC to the
tune of almost $10,000 for failing to comply with an earlier discovery order in
He had entered that Order in December 2011, ruling that
the attorney-client privilege did not apply to communications between Allison
(an attorney) and Stathopoulus, both of whom were LLC members. He directed
those two parties to produce the documents they had withheld on the basis of
privilege within thirty days, and to produce a privilege log for documents they
continued to maintain as privileged within the same time frame. If
disputes continued, Allison and Stathopoulus were to deliver the documents
in camera for the Court's review.
Read this article in
its entirety on North
Carolina Business Litigation Report, a blog for lawyers focusing on issues
of North Carolina business law and the day-to-day practice of business
litigation in North Carolina courts.
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