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Ruehl v. S.N.M. Enterprises, Inc.

United States District Court, M.D. Pennsylvania

July 20, 2018

EDWARD RUEHL, Individually and as Administrator of the Estate of Shirley T. Ruehl, deceased, Plaintiff



         I. Factual Background

         We now write a final, melancholy chapter in this lawsuit as we conclude sanctions litigation relating to the Plaintiffs' expert witness, Michael Panish. The background of these sanctions proceedings were thoroughly outlined by the court in its prior decision finding that Panish engaged in sanctionable misconduct. Ruehl v. S.N.M. Enterprises, Inc., No. 1:15-CV-168, 2017 WL 5749560, (M.D. Pa. Nov. 28, 2017). Briefly, though, Panish was retained as a critical liability expert by the Ruehl family following a mishap at a motel in which Mrs. Ruehl, an elderly motel patron was allegedly struck by a sliding door, suffering a severe fall which the Plaintiffs alleged ultimately caused her death.

         With the issues framed in this fashion, the Plaintiffs sought out Michael Panish as an expert witness in this case. At the time that the Plaintiffs contacted Panish he held himself out as an expert in multiple construction and building disciplines, and specifically asserted that he was a premier expert witness in the field of automated sliding glass door technology. Panish also asserted that he had served as an expert witness in over 1, 000 cases, an attestation which meant that Panish was thoroughly conversant with his legal and ethical obligations as an expert witness.

         As discovery proceeded the defendant sought to take a videotaped deposition of Panish, a commonplace practice that is specifically authorized by the Federal Rules of Civil Procedure. Panish refused, citing a matter which he had obliquely alluded to in his expert witness contract with Plaintiffs' counsel, his odd, idiosyncratic view that the video could be manipulated by third parties. Following a conference with counsel on March 17, 2017, we entered an order in this matter which provided in clear and precise terms as follows:

Recognizing that the defendant has a right to record Mr. Panish's deposition by video, and finding that the plaintiff has not demonstrated sufficient good cause for the issuance of a protective order, IT IS ORDERED THAT the plaintiff's request for a protective order to preclude the video recording of Mr. Panish's deposition is DENIED. The defendant shall be permitted to record Mr. Panish's deposition by video and stenographic means.
In order to address Mr. Panish's concerns, however; and to memorialize the defendant's representations regarding the intended use of the video recording of the deposition, IT IS FURTHER ORDERED THAT the parties shall use Mr. Panish's recorded deposition only for purposes of defending or prosecuting the claims in this litigation, and shall not disseminate the recording outside of these proceedings in the absence of a Court order.

         (Doc. 57, p. 6.)

         Thus, our order directed a videotaped deposition of Mr. Panish, but thoroughly addressed Panish's odd and speculative concern that his visage and words would be digitally altered by unknown sinister actors by setting strict limitations on the dissemination of the video.

         Our March 17 order gave Mr. Panish a few clear choices. He could comply with the order. He could seek timely reconsideration of the order. He could through separate counsel file his own motion for protective order, or motion to quash the deposition subpoena that the defendant was attempting to serve upon him. The one thing he could not do, however, was to engage in some unilateral passive-aggressive course in which he ostensibly agreed to schedule a deposition, while privately evading his basic obligation owed by all witnesses by failing to appear for that deposition.

         Yet this is precisely the path that Panish chose.

         Mr. Panish responded to this clear direction from this court, and the plain dictates of the Federal Rules of Civil Procedure, in a fashion which was deceptive, occasionally profane, highly unprofessional, contumacious and sanctionable. At the outset, according to the testimony and contemporaneous notes of Plaintiffs' counsel which we find to be entirely credible, when notified by Plaintiffs' counsel following the court's conference call with the parties that the court had denied his request for a protective order which would have forbidden this videotaped deposition Mr. Panish replied: “I don't care about you or her [the decedent Plaintiff, Shirley Ruehl] or some asshole judge.” (Doc. 86-1.)[1] Indeed, when Plaintiffs' counsel appealed to Panish's conscience by noting that the family of the deceased plaintiff, Shirley Ruehl, was counting upon his testimony and assistance, Panish responded in a manner that was cold, calculating and cruel, reportedly stating that: “ Nothing will bring her back so who gives a shit.” (Id.) Furthermore, while casting his position as a matter of principle, Panish was willing to surrender his principles for a price and told Plaintiffs' counsel that he would surrender his principles if they provided him a $10, 000, 000 indemnity bond from Lloyds of London.

         Yet at the same time that Panish was privately voicing his complete disdain for this court's order and his own client, he was ostensibly complying with the order by making scheduling arrangements for this deposition in April of 2017. Panish also retained a $3, 050 advance he had received from the defendant as payment for this deposition, keeping and using those funds for his own benefit for some eight months before surrendering these funds which he had obtained on the pretext that he would undergo a deposition on the eve of the sanctions hearing set in this case. On April 18, 2017, Panish failed to appear for this deposition without any prior explanation or excuse from the court, or counsel. Panish's failure to appear, and his apparent disregard of this court's explicit instructions, had a series of adverse consequences for the Plaintiffs who had retained him. First, the Plaintiffs were placed in the difficult position of trying to defend Panish's indefensible conduct, filing pleadings seeking to set aside our March 17 order, an order Panish had effectively ignored. (Docs. 62 and 63.) The Plaintiffs were also compelled to negotiate a settlement of this lawsuit from a highly disadvantageous position, since Panish's abandonment of the plaintiffs and refusal to cooperate in this deposition greatly undermined their case. Panish's course of conduct also had an adverse impact upon the defendants, who were denied information relevant to their defense of this case, expended thousands of dollars to schedule this deposition, and paid $3, 050 to Panish for his services, money that Panish retained for months despite never living up to his obligations as a witness.

         It was against this backdrop that the Defendant moved to sanction Panish. (Doc.64.) The Plaintiffs also joined in this motion, (Doc. 76), and following a hearing we concluded that Panish had indulged in sanctionable misconduct. We granted the defendant's sanctions motion and awarded a sum certain in sanctions to the defendant. We further instructed the plaintiff and Panish to submit briefs and argument in support of the Plaintiffs' request for sanctions. The parties have fully briefed this issue and this matter is now ripe for resolution.

         For the reasons set forth below, in the exercise of our discretion, we will award sanctions of $22, 270.30 in favor of the Plaintiffs against Panish.

         II. Discussion

         It is well-settled that a district court has the inherent power to sanction persons appearing before it for refusing to comply with its orders and to control litigation before it. See, e.g., Tracinda Corp. v. DaimlerChrysler AG, 502 F.3d 212, 242 (3d Cir. 2007). Indeed, the inherent power of the Court to act in this area has long been recognized by the United States Supreme Court, which has held that:

It has long been understood that “[c]ertain implied powers must necessarily result to our Courts of justice from the nature of their institution, ” powers “which cannot be dispensed with in a Court, because they are necessary to the exercise of all others.” United States v. Hudson, 7 Cranch 32, 34, 3 L.Ed. 259 (1812); see also Roadway Express, Inc. v. Piper, 447 U.S. 752, 764, 100 S.Ct. 2455, 2463, 65 L.Ed.2d 488 (1980) (citing Hudson). For this reason, “Courts of justice are universally acknowledged to be vested, by their very creation, with power to impose silence, respect, and decorum, in their presence, and submission to their lawful mandates.” Anderson v. Dunn, 6 Wheat. 204, 227, 5 L.Ed. 242 (1821); see also Ex parte Robinson, 19 Wall. 505, 510, 22 L.Ed. 205 (1874). These powers are “governed not by rule or statute but by the control ...

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