Scope of Sanctions Expanded under FRCP 37(c)(2): Sixth Circuit | Practical Law

Scope of Sanctions Expanded under FRCP 37(c)(2): Sixth Circuit | Practical Law

In McCarthy v. Ameritech Publishing Inc., the US Court of Appeals for the Sixth Circuit expanded the scope of sanctions under Federal Rule of Civil Procedure (FRCP) 37(c)(2) to cover reasonable fees and expenses associated with the preparation and presentation of fee applications.

Scope of Sanctions Expanded under FRCP 37(c)(2): Sixth Circuit

Practical Law Legal Update 1-578-2727 (Approx. 3 pages)

Scope of Sanctions Expanded under FRCP 37(c)(2): Sixth Circuit

by Practical Law Litigation
Published on 15 Aug 2014 • USA (National/Federal)
In McCarthy v. Ameritech Publishing Inc., the US Court of Appeals for the Sixth Circuit expanded the scope of sanctions under Federal Rule of Civil Procedure (FRCP) 37(c)(2) to cover reasonable fees and expenses associated with the preparation and presentation of fee applications.
On August 13, 2014, the US Court of Appeals for the Sixth Circuit in McCarthy v. Ameritech Publishing Inc. expanded the scope of sanctions under FRCP 37(c)(2) to cover reasonable fees and expenses associated with the preparation and presentation of fee applications (Nos. 13-3295 and 13-3331, (6th Cir. Aug. 13, 2014)). FRCP 37(c)(2) provides for sanctions against a party who fails to admit a request under FRCP 36 that the requesting party later proves to be true.
Kathleen McCarthy filed a suit against her former employers, Ameritech Publishing, Inc. (API) and AT&T, to recover claims related to her August 2008 termination. During the litigation, McCarthy submitted requests for admission (RFA) to API. In one request sent in August 2010, McCarthy asked API to admit that she would have been eligible to receive retirement health benefits when she was terminated in 2008. API denied this request and continued to deny her eligibility throughout the litigation. As a result, McCarthy subpoenaed records and deposed witnesses to establish her eligibility and the veracity of the RFA. More than a year later, in May 2012, API acknowledged in an e-mail that McCarthy had been eligible for health benefits at the time she was terminated, and also turned over an e-mail from 2008 confirming her eligibility.
McCarthy moved for sanctions under FRCP 37(c)(2) for API’s failure to provide accurate answers to six RFA. The district court granted her motion in part, but concluded that Rule 37(c)(2) did not permit McCarthy to recover fees related to the preparation of her fee application because those fees were not incurred in actually proving the truth of the RFA. McCarthy appealed.
The Sixth Circuit reversed. In an issue of first impression, it held that FRCP 37(c)(2) permits the award of reasonable fees and expenses associated with the preparation and presentation of fee applications necessitated by having to prove a requested admission. The Sixth Circuit concluded that the district court's interpretation of FRCP 37(c)(2) was too narrow in part because:
  • The recovery of fee application expenses is permitted when an adversary fails to heed other discovery rules in violation of FRCP 37's other provisions, such as FRCP 37(d)(1)(A) and (c)(1).
  • Violations of these other provisions in FRCP 37 are not inherently more egregious than a violation of FRCP 37(c)(2).
Attorneys must carefully prepare responses to RFA with their clients to avoid sanctions under FRCP 37(c)(2), which may now include fees and expenses associated with the preparation and presentation of fee applications.