Mark Spotted Horse v. BNSF Railway

May 29 2015

DA 14-0257
Case Number: DA 14-0257

IN THE SUPREME COURT OF THE STATE OF MONTANA

2015 MT 148

MARK SPOTTED HORSE,

Plaintiff and Appellant,

v.

BNSF RAILWAY COMPANY,

Defendant and Appellee.

APPEAL FROM: District Court of the Eighth Judicial District,
In and For the County of Cascade, Cause No. BDV 10-421
Honorable Julie Macek, Presiding Judge

COUNSEL OF RECORD:

For Appellant:

James T. Towe, Kimberly L. Towe, Towe & Fitzpatrick, PLLP, Missoula,
Montana

James Ferguson, Chester H. Lauck, III, Law Office of H. Chris Christy,
North Little Rock, Arkansas

For Appellee:

Scott M. Stearns, Christopher L. Decker, Boone Karlberg P.C., Missoula,
Montana

Submitted on Briefs: January 14, 2015
Decided: May 29, 2015

Filed:

__________________________________________
Clerk
Justice Patricia Cotter delivered the Opinion of the Court.

¶1 Mark Spotted Horse appeals from a jury verdict and judgment rendered in favor of

BNSF Railway Company in the Eighth Judicial District Court, Cascade County.

¶2 Spotted Horse presents four issues on appeal. Because we reverse and remand, we

need address only two issues, which we restate as follows:

1. Whether the District Court abused its discretion in declining to grant Spotted
Horse’s request for a default judgment based on the spoliation of video footage
taken at BNSF’s Diesel Shop on the day Spotted Horse was injured.

2. Whether the District Court abused its discretion when it instructed the jury as to
BNSF’s duty of care in a FELA action.

FACTUAL AND PROCEDURAL BACKGROUND

¶3 On April 28, 2010, Mark Spotted Horse, a BNSF Railway Company (BNSF)

machinist, filed suit against BNSF alleging negligence under the Federal Employers’

Liability Act, 45 U.S.C. §§ 51-60. Spotted Horse claimed that on September 13, 2009,

while working in BNSF’s Diesel Shop in Havre, Montana, he suffered a disabling injury

when his co-worker Jim Syverson inadvertently lowered a locomotive engine

compartment hatch on his head. Spotted Horse reported the incident to his BNSF

supervisors and was immediately taken to the hospital by BNSF Shop Superintendent

Beau Price. Shortly thereafter, Spotted Horse filed an employee injury report indicating

that the rope used to lower the engine compartment hatch had slipped through Syverson’s

hand. According to the injury report, the hatch then struck Spotted Horse on the top of

his hard hat causing him to suffer headaches and neck pain.

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¶4 BNSF General Foreman Paul McLeod immediately commenced to investigate and

collect information relative to Spotted Horse’s injuries. In coordination with Price and

General Electric (GE) Senior Site Manager Rob Wood,1 McLeod collected Spotted

Horse’s hard hat, conducted reenactments of the alleged injury, took photographs, and

interviewed and obtained written statements from both Spotted Horse and Syverson.

¶5 At the time of the alleged incident, the Diesel Shop had a digital camera recording

system in place, which consisted of multiple video cameras positioned at various

locations throughout the shop stalls.2 The video cameras ran continuously, recording 24

hours per day, seven days per week, and generated footage that was viewable real-time

on a monitor in the shop supervisor’s office.

¶6 For purposes of investigating injuries and rule violations and implementing

possible disciplinary actions against employees, BNSF personnel routinely requested

copies of video footage by emailing or calling BNSF’s Resource Operation Center

(ROC), located in Fort Worth, Texas. The ROC administers resource protection,

including the preservation of video footage. Absent a video footage request within a

specified period of time, typically 15 to 30 days, the digital recording system

automatically overwrites old video footage with new video footage.

1
In the Havre Diesel Shop, BNSF dealt with two brands of locomotives, including GE
locomotives. Wood, as Senior Site Manager, was responsible for delivering GE locomotives to
BNSF.
2
During his deposition on February 28, 2012, McLeod stated that the Diesel Shop had 17
operating video cameras. The record is unclear, however, as to how many video cameras were in
operation on the date of Spotted Horse’s alleged incident.

3
¶7 Spotted Horse maintains that during a post-incident interview he requested a copy

of the video footage from the shop’s cameras. Later, after his lawsuit was filed, Spotted

Horse made several discovery requests, including a request for the production of videos

and photographs of the work area where the alleged injury occurred. According to

Spotted Horse, BNSF initially produced three photographs, but it never referenced or

provided any video footage. Spotted Horse eventually moved the court for an order to

compel BNSF to answer his discovery requests. BNSF responded that McLeod had

contacted the ROC to request video footage from the two stalls where Spotted Horse was

allegedly injured. However, as stated in BNSF’s response, the ROC informed McLeod

“that the videos overwrite every 15 to 30 days, therefore any video footage from

9/13/2009 no longer exists.” BNSF stated that “[a]fter further inquiry, it was determined

that there is no record of the video being requested in September or October 2009” (the

six weeks following the accident).

¶8 McLeod subsequently acknowledged in a deposition that he had utilized video

recordings for investigations of workers for rule violations as well as in connection with

injuries and was aware that the video recording system would overwrite recordings after

a certain period of time. McLeod testified that on the evening of the incident, he and

Price had “probably watched about 15 minutes” of video footage from one camera

located in the stall purportedly closest in proximity to where the alleged injury occurred.

According to McLeod, he “[a]bsolutely . . . could have requested” a copy of the video

footage. However, McLeod determined “[t]here was no evidence to preserve” because

that particular camera did not capture the area where Spotted Horse and Syverson were

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working nor did the camera show Spotted Horse’s alleged injury. McLeod stated that he

had not viewed video footage from any other camera in the shop and agreed that other

cameras may have captured Spotted Horse and Syverson performing other acts in the

shop.

¶9 Likewise, in his deposition, Price stated that he watched video footage “once or

twice” with McLeod, but that they “could see nothing there.” BNSF indicated that GE

representative Wood also viewed the video and had reached the same conclusion.

¶10 Although he did not immediately contact BNSF’s claims department regarding the

investigation into Spotted Horse’s alleged injury, McLeod eventually submitted his

findings to BNSF Senior Claims Representative Nancy Ahern. Ahern stated that she was

not aware of any BNSF policy that instructs BNSF supervisors to immediately notify the

claims department so that evidence can be preserved. However, she stated that if she is

apprised of a situation where there is video footage as evidence, she will make a request

from ROC. No such request was made here, as BNSF did not make a timely request to

preserve any of the video footage from any of the cameras in place at the time of the

alleged incident.

¶11 On July 27, 2012, Spotted Horse moved for a default judgment against BNSF on

the issues of liability, causation, and contributory negligence based on the alleged

spoliation of video footage and other discovery abuses. The District Court denied the

motion, but prohibited BNSF from introducing or referring to any testimony or evidence

about the video footage unless Spotted Horse first chose to introduce that information. In

that event, BNSF would be free to tell the jury what the videos ostensibly showed.

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¶12 A jury trial commenced on December 2, 2013. During trial, both parties

presented testimony and evidence regarding the relevancy and unavailability of the video

footage.

¶13 Among the jury instructions given, Instruction No. 2 stated, in pertinent part:

If it appears that a party intentionally or recklessly destroyed or concealed
evidence favorable to the other party, then you should view any contrary
evidence presented by that party with distrust.

Additionally, over Spotted Horse’s objection, the district court provided Instruction No.

11 concerning BNSF’s duty of care, which stated the following:

BNSF was not obligated to eliminate all risks in the work place; it was only
obligated to eliminate unreasonable risks.

¶14 On December 10, 2013, the jury found in favor of BNSF and the case was

dismissed with prejudice. Spotted Horse subsequently moved for a new trial, which the

District Court denied. Spotted Horse appeals.

STANDARDS OF REVIEW

¶15 We review a District Court’s decision to impose or decline to impose sanctions for

an abuse of discretion. Schuff v. A.T. Klemens & Son, 2000 MT 357, ¶ 26, 303 Mont.

274, 16 P.3d 1002. In doing so, we generally defer to the district court because it is in the

best position to determine both whether the party in question has disregarded the

opponent’s rights, and which sanctions are most appropriate. Richardson v. State, 2006

MT 43, ¶ 21, 331 Mont. 231, 130 P.3d 634. In determining whether the trial court abused

its discretion, the question is not whether the reviewing court agrees with the trial court,

but rather whether the trial court acted arbitrarily without the employment of

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conscientious judgment or exceeded the bounds of reason, in view of all the

circumstances. Schuff, ¶ 27.

¶16 We review for an abuse of discretion whether the district court correctly instructed

the jury. Peterson v. St. Paul Fire & Marine Ins. Co., 2010 MT 187, ¶ 22, 357 Mont.

293, 239 P.3d 904. “[W]hile a district court has broad discretion to formulate jury

instructions, that discretion is limited by the overriding principle that jury instructions

must fully and fairly instruct the jury regarding the applicable law.” Peterson, ¶ 22

(quoting Tarlton v. Kaufman, 2008 MT 462, ¶ 19, 348 Mont. 178, 199 P.3d 263) (internal

quotation marks omitted). In reviewing whether a particular instruction was properly

given, “we consider the instruction in its entirety, as well as in connection with the other

instructions given and with the evidence introduced at trial.” Tarlton, ¶ 19 (quoting

Murphy Homes, Inc. v. Muller, 2007 MT 140, ¶ 74, 337 Mont. 411, 162 P.3d 106).

DISCUSSION

¶17 Issue 1: Whether the District Court abused its discretion in declining to grant
Spotted Horse’s request for a default judgment based on the spoliation of video footage
taken at BNSF’s Diesel Shop on the day Spotted Horse was injured.

¶18 Spotted Horse argues that the District Court abused its discretion in refusing to

enter default judgment against BNSF for spoliation of the Diesel Shop’s video footage

taken on the day of Spotted Horse’s alleged injury. Spotted Horse contends that BNSF’s

intentional destruction of video footage resulted in irreparable prejudice and forestalled

any means to a fair resolution of his claim. Under the circumstances, Spotted Horse

insists the only adequate sanction was an entry of default judgment against BNSF. BNSF

counters that its actions were not intentional or committed in bad faith and further

7
maintains that Spotted Horse did not suffer prejudice because the video footage did not

capture any of the alleged events.

¶19 In its denial of Spotted Horse’s motion for default judgment, the District Court

concluded that Spotted Horse had failed to present sufficient evidence to warrant “the

most drastic of all sanctions, default judgment.” As a remedial measure, the court

prohibited BNSF from introducing or referring to any testimony or evidence that

McLeod, Price, and Wood had watched the video footage and determined that the alleged

incident was not viewable, reasoning that “BNSF should not be allowed to benefit by its

failure to preserve the video footage.” However, the court concluded that if Spotted

Horse “tactical[ly]” chose to present information about the videos to the jury, he would

forego the court’s protection. In addition, the district court utilized a portion of

Instruction No. 2 as an adverse instruction. Against this backdrop, we turn to the

question of whether the District Court abused its discretion in failing to impose a default

judgment.

¶20 District courts “are well equipped under the Montana Rules of Civil Procedure to

address the problem [of spoliation of evidence] as it occurs and deal with it accordingly,

even entering default when the circumstances justify such relief.” Oliver v. Stimson

Lumber Co., 1999 MT 328, ¶ 32, 297 Mont. 336, 993 P.2d 11. Under certain

circumstances, this Court has upheld or imposed default judgment as an appropriate

sanction for discovery abuses. See e.g., Richardson, ¶¶ 65, 68 (default judgment

appropriate where the State’s “pattern of willful and bad faith conduct” amounted to a

“blatant and systemic” abuse of the discovery process that “undermined the integrity of

8
the entire proceeding”); Culbertson-Froid-Bainville Health Care Corp. v. JP Stevens &

Co. Inc ., 2005 MT 254, ¶ 17, 329 Mont. 38, 122 P.3d 431 (default judgment warranted

where discovery responses were “evasive [and] woefully incomplete” resulting in a

“flagrant, complete and persistent disregard” of court orders and rules of civil procedure);

Schuff, ¶ 81 (affirming imposition of a default judgment for discovery abuses after

defendant acted “willfully and in bad faith shield[ing] Schuff from a clear view of the

truth”); cf. Stokes v. Ford Motor Co., 2013 MT 29, ¶ 20, 368 Mont. 365, 300 P.3d 648

(given that there was no wanton disregard of court orders or an intention to “slow down

discovery,” district court did not abuse its discretion in declining to enter default

judgment).

¶21 We have emphasized that discovery abuses “must no longer be dealt with leniently

and that the transgressors of discovery abuses should be punished rather than encouraged

repeatedly to cooperate.” Schuff, ¶ 70; see also Richardson, ¶ 56. We have further stated

that concerns “related to crowded dockets and the responsibility to maintain fair and

efficient judicial administration have shifted the traditional reluctance to impose

discovery-related sanctions to a judicial intolerance of discovery abuses.” Schuff, ¶ 70

(quoting McKenzie v. Scheeler, 285 Mont. 500, 506, 949 P.2d 1168, 1171 (1997)).

¶22 Although the issue before us relates to the spoliation of video footage before the

initiation of the formal discovery process, the rationale for imposing sanctions on a party

for discovery abuse applies here with equal force. As a sophisticated and recurrent party

to litigation, BNSF is aware of its obligation to preserve evidence. In fact, it has in the

past been subject to complaints from litigants concerning spoliation of evidence, and–as

9
Spotted Horse asserted in the District Court–has previously been admonished in court for

concealing or disposing of evidence.

¶23 For example, in the Thirteenth Judicial District of Montana, the district court

granted the plaintiff’s motion for relief relating to liability and struck BNSF’s defense of

contributory negligence after BNSF improperly disposed of a handset and cord, which

were “key evidence of liability.” Order Granting Relief, Silliker v. BNSF, DV 04-0955,

3-4 (Thirteenth Jud. Dist. Jan. 27, 2010). In granting relief, the court did not find bad

faith, but stated that “BNSF knew of their [sic] duty to secure and retain possession of

evidence” and “without that evidence both Silliker and BNSF would be deprived of the

ability to reconstruct its condition prior to the incident, thereby making proof of either

party’s respective positions impossible.” Order Granting Relief, Silliker v. BNSF, DV

04-0955, 4.

¶24 In Dolan v. BNSF, the Eighth Judicial District Court ordered BNSF to pay the

plaintiff’s attorney fees and associated costs of discovery after finding that BNSF had

failed to be diligent in acquiring information about company vehicles which “existed and

was readily available to [BNSF] at the time the Plaintiff propounded discovery

request[s]” relating to his underlying claims. Order, Dolan v. BNSF, ADV 01-1090(B),

4-5 (Eighth Jud. Dist. Aug. 22, 2003).

¶25 In Schmidt v. BNSF, the same court addressed various discovery-related issues and

abuses. It concluded that BNSF’s “non-disclosure [of email communications, injury

reports, and claims records] is neither isolated nor relatively insignificant” and “yet

another instance in a larger recurring pattern and practice of dilatory and obstructive

10
discovery practices in this and other FELA cases before this Court.” Order Den. BNSF

Mot. for Prot. Orders and Aff. Previously-Imposed Disc. Sanctions on Addt’l Grounds,

Schmidt v. BNSF, CDV-04-152(d), 11 (Eighth Jud. Dist. Ct. Mar. 1, 2006).

¶26 The district court made similar observations and conclusions when it addressed

alleged discovery abuses in a related case, Danielson v. BNSF. “[A]llowing BNSF to

simply claim ‘no harm–no foul’ and to remedy its non-disclosure with belated production

and supplemental discovery by Plaintiff would allow BNSF to unjustly benefit” from its

conduct “without any deterrent to the continuance of this practice.” Order on Misc. Mot.

and Order Imposing Sanctions in re Proof of Negligence and BNSF Vocational Rehab

Program, Danielson v. BNSF, CDV-04-124(d), 16-17 (Eighth Jud. Dist. Ct. Mar. 13,

2006).

¶27 BNSF is a seasoned and sophisticated corporate litigant well aware of its

obligations when responding to workplace violations and employee injuries and

accidents. These obligations include the retention of evidence relevant to injury claims.

In this case, BNSF supervisors took immediate action within minutes of Spotted Horse’s

alleged accident. While Price drove Spotted Horse to the hospital for medical treatment,

BNSF supervisors began gathering and analyzing information related to the incident.

Within hours of the alleged accident, according to testimony, three individuals viewed a

brief portion of the video footage from one camera in the shop stall where Spotted Horse

and Syverson were apparently working. And yet–inexplicably–this and other video

footage from the shop was not retained.

11
¶28 BNSF takes the disconcerting position that the video footage would not have been

useful even if preserved. In making this argument, BNSF relies on the recollection of

three individuals–two of its own employees and one employee of an affiliate–who

purportedly “agreed [the video] showed nothing of significance” and was otherwise “not

relevant.”

¶29 Our rules define relevant evidence as “evidence having any tendency to make the

existence of any fact that is of consequence to the determination of the action more

probable or less probable than it would be without the evidence.” M. R. Evid. 401. We

reiterate the importance of relevant evidence within the context of cases involving the

spoliation of evidence:

Relevant evidence is critical to the search for the truth. The intentional or
negligent destruction or spoliation of evidence cannot be condoned and
threatens the very integrity of our judicial system. There can be no truth,
fairness, or justice in a civil action where relevant evidence has been
destroyed before trial. Historically, our judicial system has fostered
methods and safeguards to insure that relevant evidence is preserved.
Ultimately, the responsibility rests with both the trial and appellate courts to
insure that the parties to the litigation have a fair opportunity to present
their claims or defenses.

Oliver, ¶ 31.

¶30 We reject the notion that BNSF is entitled to unilaterally determine which

evidence is relevant or valuable when investigating an alleged work-related accident

preceding litigation. Such a decision must be left to the trial court. See State v. Gai,

2012 MT 235, ¶ 15, 366 Mont. 408, 288 P.3d 164 (“the trial judge is tasked with

determining admissibility of evidence”) (citing M. R. Evid. 104); Preston v. Mont.

Eighteenth Judicial Dist. Court, 282 Mont. 200, 208, 936 P.2d 814, 819 (1997)

12
(“discovery requests are to be construed broadly in favor of disclosing any information

tending to lead to admissible evidence. Whether that evidence is admissible is for the

court to decide at trial, not for [the party] to determine at the discovery stage of

proceedings”); see also Patton v. Wal-Mart Stores, Inc., 2013 U.S. Dist. LEXIS 165617,

*14 (D. Nev. Nov. 20, 2013) (“[w]hether ‘nothing’ or ‘something’ was caught on film is

an evidentiary question of relevance” for the court). Interestingly, BNSF chose to collect

and secure Spotted Horse’s hard hat even though McLeod determined the hard hat (like

the video footage) had “no evidence of a significant impact” and “nothing that show[ed]

[him] there was anything that happened to it.”

¶31 The fact that the video footage was destroyed prior to the submission of Spotted

Horse’s claim affords BNSF no relief. As its internal policies contemplate, BNSF clearly

had the means to collect the video footage by simply sending an email or making a

telephone call as it has routinely done for other investigations involving rule violations

and work-place injuries. Whether the spoliation of video footage was a litigation tactic or

inadvertent as BNSF claims, BNSF’s conduct has effectively undermined the “search for

the truth” of what actually transpired on September 13, 2009. See Oliver, ¶ 31; see also

Schuff, ¶ 79 (“‘excusable ignorance’ defense cannot be looked upon with anything less

than disfavor”).

¶32 Even if we were to accept BNSF’s contention that the one video camera did not

capture Spotted Horse’s alleged injury, the recordings from this video camera and others

positioned throughout the Diesel Shop could have revealed a wealth of information

relating to the alleged injury–a fact BNSF admitted during pre-trial depositions. For

13
example, the video cameras could have captured the exact timeframe and the activity that

occurred before or after the alleged injury; whether Spotted Horse and Syverson were

carrying particular tools or equipment, including the rope that allegedly slipped through

Syverson’s hands; whether Spotted Horse’s mannerisms or gait appeared altered when he

walked to the computer terminal to report his injury after it occurred; whether, according

to the disputed testimony of BNSF employee Josh Allen, “Spotted Horse drop[ped] down

into a sitting position on the locomotive step” after the alleged incident; or, as BNSF

employee Larry Lund stated, whether Spotted Horse’s claims were “bogus.” Because

this video footage was destroyed, Spotted Horse was left with the impossible task at trial

of accurately recreating that which was irretrievably lost.

¶33 An even more insidious result of the destruction of the evidence was the District

Court’s pre-trial ruling that precluded BNSF from offering evidence that the cameras

showed no accident, unless Spotted Horse opened the door by informing the jury that the

videos had been destroyed. Under the court’s ruling, once Spotted Horse informed the

jury about the destruction of the video evidence, BNSF was then free to tell the jury that

it had observed the video footage and that it did not show that an accident had occurred.

In other words, BNSF was allowed to enjoy the benefit of its destruction of the evidence

by implying to the jury that Spotted Horse’s injury never happened. Thus, BNSF’s

conduct effectively derailed Spotted Horse’s right to have “a fair opportunity to present

[his] claims or defenses.” Oliver, ¶ 31.

¶34 In seeking reversal and a default judgment, Spotted Horse relies in part on Peschel

v. City of Missoula, 664 F. Supp. 2d 1137 (D. Mont. 2009), a case concerning the

14
spoliation of a police vehicle video recording of an arrest allegedly performed with

“unreasonable force,” which later became the subject matter of a civil suit. The Federal

district court had previously determined that the City of Missoula had a duty under

Montana law to preserve video recordings throughout the course of the investigation and

the disposition of the criminal charge and after acquittal, because the prospect of a civil

suit was “reasonably foreseeable.” Peschel, 664 F. Supp. 2d at 1141.

¶35 Countering the plaintiff’s request for default judgment, the City of Missoula

argued that the loss of video evidence did not prejudice the plaintiff because witnesses

were available to testify as to what they observed. Peschel, 664 F. Supp. 2d at 1145. As

an alternative, the City proposed prohibiting “the officers from testifying as to what they

saw in the video.” Peschel, 664 F. Supp. 2d at 1145 (internal quotation marks omitted).

The court found that this “purported sanction would have absolutely no punitive,

deterrent, or remedial value” and would otherwise condone “the spoliation of the best

evidence available to resolve the factual dispute with the greatest accuracy.” Peschel,

664 F. Supp. 2d at 1145.

¶36 The court in Peschel further concluded that the rebuttable presumption created by

an adverse instruction allowing the jury to infer that the video recording would have been

unfavorable to the City “would not sufficiently punish the City for its spoliation nor serve

as a sufficient disincentive to destroy evidence,” otherwise “pitting the evidence of its

officers against the Peschels and the other percipient witnesses–unphased by its

spoliation of the video recording.” Peschel, 664 F. Supp. 2d at 1148. Ultimately, the

court did not allow evidence regarding the spoliation because doing so “would not

15
enhance, but actually degrade, the truth-finding process.” Peschel, 664 F. Supp. 2d at

1148. The court found that the most appropriate sanction was a conclusive finding that

the arresting officers had used unreasonable force. Peschel, 664 F. Supp. 2d at 1145.

¶37 Here, the District Court reasoned that “BNSF should not be allowed to benefit by

its failure to preserve the video footage.” We agree. However, the court then

undermined its assertion by imposing a sanction that placed Spotted Horse in a “lose-

lose” position. If Spotted Horse agreed not to tell the jury that BNSF had destroyed the

video footage, then BNSF would be precluded from telling the jury what its employees

saw on the videos. However, if Spotted Horse told the jury that the videos had been

destroyed, then BNSF employees would be free to tell the jury that the claimed injury

simply did not show up on any cameras. The ultimate effect of the sanction, as observed

in Peschel, did not punish BNSF as the transgressor; rather, it invited BNSF to capitalize

on the destruction of the video footage with its inference that Spotted Horse fabricated his

injury–a focus that “actually degrade[d] the truth-finding process.” See Peschel, 664 F.

Supp. 2d at 1148.

¶38 Although the district court instructed the jury to view BNSF’s evidence “with

distrust” if it appeared that BNSF “intentionally or recklessly destroyed or concealed

evidence favorable to the other party,” as in Peschel, this instruction was an inadequate

cure for the prejudice to Spotted Horse.

¶39 Although BNSF clearly knows better than to dispose of video footage of an

accident scene, it is simply not possible to determine whether the destruction of the

evidence was intentional or inadvertent. Given this circumstance, we do not find that the

16
District Court’s refusal to grant Spotted Horse’s request for a default judgment was an

abuse of discretion. However, we do conclude that the District Court abused its

discretion when it declined to impose a meaningful sanction on the railroad, and instead

fashioned a ruling that ultimately rewarded rather than punished BNSF for its destruction

of evidence. Accordingly, we reverse the judgment of the District Court and remand this

matter for a new trial, at which time the court shall fashion a sanction that is

commensurate with the significance of BNSF’s actions in allowing the video footage to

be destroyed, and which will satisfy the remedial and deterrent goals of sanctions for the

spoliation of evidence.

¶40 Issue 2: Whether the District Court abused its discretion when it instructed the
jury as to BNSF’s duty of care in a FELA action.

¶41 Spotted Horse also contends that the court committed error by giving an improper

jury instruction concerning BNSF’s duty of care under FELA. Jury Instruction No. 11

provided:

BNSF was not obligated to eliminate all risks in the work place; it was only
obligated to eliminate unreasonable risks.

¶42 We agree that the language in Instruction No. 11 incorrectly states BNSF’s duty of

care and seemingly contradicts the language found in Jury Instruction No. 10, to which

neither party objected and which provided in pertinent part:

Thus, the railroad is negligent if it fails to use reasonable care to provide
railroad workers with a reasonably safe place to work. Reasonable care is
the care that a reasonably prudent person would use in the conduct of his,
her, or its own affairs in order to avoid injury or damage to his, her, or its
own person or property as well as the person or property of others. The
amount of care or caution required of a reasonably prudent person

17
 varies according to the dangers known or reasonably foreseeable to the
person. Negligence may consist of action or inaction.

(Emphasis added.)

¶43 We conclude that on remand, Instruction No. 11 shall not be given.

CONCLUSION

¶44 We reverse and remand for further proceedings consistent with this opinion.

/S/ PATRICIA COTTER

We Concur:

/S/ MIKE McGRATH
/S/ JAMES JEREMIAH SHEA
/S/ BETH BAKER
/S/ JIM RICE

Justice Michael E Wheat, specially concurring.

¶45 I agree with the Court’s decision to reverse the judgment of the District Court and

to order more serious spoliation sanctions against BNSF on remand. I would, however,

remand to the District Court with an instruction to enter default judgment, because the

audacity of the spoliation in this case warrants more than a mere negative inference in

favor of Spotted Horse.

¶46 This is not a case where the plaintiff slept on his claim. Spotted Horse provided

prompt notice of his intention to bring suit and a prompt request for the surveillance

video that would have resolved several factual disputes and all but proven a number of

18
the elements of his claim. This is also not a case where the information was lost

mistakenly or inadvertently. The destruction of the video was the result of knowing,

culpable conduct. BNSF was on notice of Spotted Horse’s intention to sue. It knew the

value of the video, and it knew that the video was exclusively in its control. Taking

advantage of this control, BNSF not only let the video be destroyed but also destroyed the

best evidence of what the video would have shown by moving its surveillance cameras.

Meanwhile, BNSF took special care to preserve other particular items of evidence that it

thought were “perishable,” “one of a kind,” or “critical.”

¶47 Such knowing, calculated, and prejudicial spoliation of evidence demands default

judgment. It is the obligation of every Montana court to protect the integrity of the

judicial system and to ensure proper administration of justice. See Oliver v. Stimson

Lumber Co., 1999 MT 328, ¶ 31, 297 Mont. 336, 993 P.2d 11. Usually this means that

there is a presumption in favor of resolution of controversies on their merits. But, in

cases where a party maliciously misuses our judicial system, this presumption is forfeited

and the obligation to protect the judicial system instead requires courts to remedy the

misuse, to punish the misuser, and to deter future misuse. See Richardson v. State, 2006

MT 43, ¶ 68, 331 Mont. 231, 130 P.3d 634; Schuff v. A.T. Klemens & Sons, 2000 MT

357, ¶ 81, 303 Mont. 274, 16 P.3d 1002; Oliver, ¶ 34. Spoliation is an especially

pernicious form of misuse, and this Court and other Montana courts should not shy from

responding with commensurate sanctions.

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¶48 Spoliation has a profound effect on our judicial system. “Aside perhaps from

perjury, no act serves to threaten the integrity of the judicial process more than the

spoliation of evidence. Our adversarial process is designed to tolerate human failings –

erring judges can be reversed, uncooperative counsel can be shepherded, and recalcitrant

witnesses compelled to testify. But, when critical documents go missing, judges and

litigants alike descend into a world of ad hoc[] . . . half measures – and our civil justice

system suffers.” Margaret M. Koesel et al., Spoliation of Evidence: Sanctions and

Remedies for Destruction of Evidence in Civil Litigation 1 (3d ed., 2013); see also

Charles R. Nesson, Incentives to Spoliate Evidence in Civil Litigation: The Need for

Vigorous Judicial Action, 13 Cardozo L. Rev. 793, 793 (1991) (“By its nature spoliation

is invisible. The evidence may have been unknown to anyone but the spoliator. The act

itself need leave no trace. . . . Spoliation is an effective, and, I believe, a growing

litigation practice which threatens to undermine the integrity of civil trial process.”).

“There can be no truth, fairness, or justice in a civil action where relevant evidence has

been destroyed before trial.” Oliver, ¶ 31.

¶49 Unfortunately, spoliation and other obstructive techniques have become much too

commonplace. See, e.g., Bilesky v. Shopko Stores Operating Co., LLC, 2014 MT 300,

¶¶ 6-8, 377 Mont. 58, 338 P.3d 76; Order Granting Relief, Silliker v. BNSF,

Jan. 27, 2010, DV 04-0955 (Mont. 13th Dist. Ct.); Order, Dolan v. BNSF, Aug. 22, 2003,

ADV-01-1090(B) (Mont. 8th Dist. Ct.); Danielson v. BNSF, March 13, 2006,

CDV-04-124(d) (Mont. 8th Dist. Ct.); Schmidt v. BNSF, March 1, 2006, CDV-04-252(d)

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(Mont. 8th Dist. Ct.); Koesel et al., supra, at xvi-xvii. Commentators have advocated

vigorous judicial action in response, e.g. Nesson, supra, at 805-07, and this Court has

recognized the need to address the problem. Oliver, ¶¶ 31-34, 40.

¶50 The Court even went so far as to recognize a new tort for third party spoliation,

noting that it is this Court’s responsibility to ensure that our judicial system provides a

fair opportunity for litigants to present their claims and defenses. Oliver, ¶¶ 31, 34, 40.

The Court did not make that tort available against parties to the litigation, because it

reasoned that the strength and breadth of the remedies available to Montana courts, which

include default judgment, was already sufficient. Oliver, ¶ 32. While this is true –

Montana courts do have a sufficient set of available remedies to adequately address

spoliation – the remedies are meaningless unless they are actually used and effectively

crafted.

¶51 As such, Montana courts should not shrink from granting default judgment where,

as here, spoliation is willful, in bad faith, or knowingly committed in order to obscure the

truth and to prevent accurate decision making. By failing to take such action when it is

warranted, we fail the spoliation victim and our system of justice, while at the same time

rewarding the spoliator with the result he or she sought: an advantage in litigation. By

failing to take such action, we set the stage with perverse incentives and encourage

further spoliation. Until we are willing to respond with sanctions commensurate to the

damage caused by intentional spoliation – that is, with default judgment – the reward

from destroying evidence will continue to outweigh the risk.

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¶52 The District Court’s decision did not effectively serve to remedy BNSF’s

spoliation, to punish BNSF, or to dissuade others from committing similar acts. BNSF

still comes out ahead, served by its misconduct. Again, this case is one where the

spoliator, BNSF, acted knowingly and purposely to destroy evidence. In response to such

actions, I would instruct the District Court to order default judgment in favor of Spotted

Horse on remand.

/S/ MICHAEL E WHEAT

Justice Laurie McKinnon, dissenting.

¶53 I agree with the Court’s pronouncement that BNSF, or indeed any litigant, is not

“entitled to unilaterally determine which evidence is relevant or valuable . . . .” Opinion,

¶ 30. Nevertheless, I am troubled by our decision today, in which we sanction BNSF

based not on its conduct in the case before us, but on its alleged prior bad acts in

completely unrelated past litigation. Opinion, ¶¶ 22-26.

¶54 I believe our inquiry should be limited to the circumstances before us and not

focused on punishing a litigant we perceive to be a bad actor. The Court primarily

premises its conclusion that BNSF’s conduct was sanctionable on the fact that BNSF has

previously been sanctioned for discovery abuses, rather than on an analysis of the record

in this case. While I do not mean to say that we—or trial courts and opposing parties, for

that matter—should put up a façade of naiveté in the face of systemic abuses, I do think

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we should honor the basic concept that a party appearing before this Court should not be

pre-judged on the basis of an allegedly bad character. See M. R. Evid. 404. Nor should a

party be exempted from receiving the benefit of this principle because that party is a

corporate entity rather than an individual.

¶55 A review of the record in the case before us is sufficient to demonstrate that

BNSF’s conduct was inappropriate. Disturbingly, Ahern stated in her deposition that

BNSF has no policy requiring supervisors to promptly notify the claims department of

incidents; that she has received no formal training regarding the collection and

preservation of evidence; and that she was not aware of any BNSF policy regarding the

preservation of evidence relevant to an injury claim. Price characterized his shop’s

practice regarding video footage as follows: “[I]f we think it’s useful or of value or has

any bearing on the incident we are investigating, we would make the request of the

resource protection desk to save a particular part of that video.”

¶56 Consistent with this practice, after reviewing about 15 minutes of footage from

one camera, Price and McLeod made the independent determination, absent consultation

with any claims specialist or legal counsel, that the footage contained “no evidence to

preserve.” At the very least, preservation of the footage would have conclusively

determined whether the accident was recorded. Further, McLeod acknowledged that

there were many other cameras in the shop that may have shown Spotted Horse before or

after the accident, or personnel in the area surrounding the stall where the accident took

place. The footage from these other cameras was never reviewed at all. BNSF’s lack of

any policy or training whatsoever addressing the preservation of evidentiary materials

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directly resulted in the destruction of potentially relevant evidence prior to trial. As the

Court notes, “The intentional or negligent destruction or spoliation of evidence cannot be

condoned and threatens the very integrity of our judicial system.” Opinion, ¶ 29 (quoting

Oliver v. Stimson Lumber Co., 1999 MT 328, ¶ 31, 297 Mont. 336, 993 P.2d 11). I have

no trouble concluding that BNSF’s failure to adopt a reasonable policy—or any policy—

for the preservation of evidence regarding workplace injuries constituted, in this case,

negligent spoliation of evidence, if not more. The depositions filed in this case are

sufficient to lead to this conclusion.

¶57 Although I would conclude that BNSF’s conduct merited the imposition of

sanctions, I am mindful that we review the District Court’s decision regarding the

appropriate form of sanctions for an abuse of discretion. Richardson v. State, 2006 MT

43, ¶ 21, 331 Mont. 231, 130 P.3d 634. I believe the District Court attempted in good

faith to neutralize the effect of BNSF’s destruction of evidence, while recognizing that a

trial on the merits is generally favored over a default judgment. Brilz v. Metro. Gen. Ins.

Co., 2012 MT 184, ¶ 15, 366 Mont. 78, 285 P.3d 494 (citing Schmitz v. Vasquez,

1998 MT 314, ¶ 27, 292 Mont. 164, 970 P.2d 1039). The Court assumes that if BNSF

employees were permitted to testify that the video footage did not show the accident, this

would establish an inference in the minds of the jury that the accident did not occur.

Opinion, ¶ 33. While this would be one possible interpretation of that testimony, it is not

necessarily the only interpretation, or even the most logical. The depositions are clear

that the camera angle was insufficient to show the area where the accident reportedly

occurred. This fact does not imply that the accident did not occur. Cross-examination of

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witnesses for BNSF should allow Spotted Horse to draw out details of their failure to

preserve, or even fully review, the evidence available. The testimony could just as likely

result in the negative inference that BNSF engaged in a cover-up.

¶58 While stronger sanctions were certainly available and may have been appropriate,

the decision regarding the suitable form of sanctions was left to the discretion of the

District Court. We fail to recognize the distinction between a trial court’s discretion in

assessing the propriety of sanctions and an appellate court’s role in reviewing the

exercise of that discretion when we cite the opinions of federal district courts on the

issue. Opinion, ¶¶ 34-37 (citing Peschel v. City of Missoula, 664 F. Supp. 2d 1137

(D. Mont. 2009)). Although this Court, if vested with the discretion to make an initial

determination of the form of sanctions, may have exercised that discretion differently

than the District Court in this instance, I am not convinced that the District Court abused

its discretion by failing to impose stronger sanctions.

¶59 Finally, I believe the Court’s analysis of Jury Instruction No. 11 is insufficient. It

is not readily apparent on the face of the instructions that an obligation “to eliminate

unreasonable risks” is inconsistent with or contradicts the duty of a reasonable person to

use reasonable care regarding reasonably foreseeable risks, stated in Jury Instruction

No. 10. The instructions, taken as a whole, adequately instructed the jury regarding an

employer’s duty to exercise reasonable care when it knows or should know of a potential

hazard in the workplace. See Gallose v. Long Island R.R. Co., 878 F.2d 80, 85 (2d Cir.

1989); Tobin v. Natl. R.R. Passenger Corp., 677 F. Supp. 674, 675 (D. Mass. 1988).

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¶60 For the foregoing reasons, I dissent and would affirm the judgment of the District

Court.

/S/ LAURIE McKINNON

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