Terminating Sanctions for Document Fabrication in Federal CourtTerminating Sanctions for Document Fabrication in Federal Court

Federal courts have repeatedly found that terminating sanctions are appropriate when a party violates the cardinal sin of litigation as “fabricating evidence has been referred to as the most egregious misconduct which justifies a finding of fraud upon the Court.” Kenno v. Colorado’s Governor’s Off. of Info. Tech., 2021 WL 2682619, at *19 (D. Colo. June 30, 2021).

The authorities below are provided to assist defendants, plaintiffs, cross-defendants, cross-complainants, cross-claimants, counterclaimants and other litigants who have been victims in litigation of document manufacturing, photoshopping, bogus documents, perjurious testimony, false documents, concocted evidence. These issues can arise real estate litigation, bankruptcy litigation, business litigation, family law disputes, and trust, estate, and probate litigation, and can lead to a bankruptcy dismissal or other federal court action with prejudice.

Indeed, the highly analogous Garcia case in which terminating sanctions against a document manufacturing plaintiff were affirmed by the Tenth Circuit made clear that: “Without doubt, fabricating evidence and willfully providing false answers during discovery are abusive litigation practices which justify the sanction of dismissal with prejudice.” Garcia v. Berkshire Life Ins. Co. of Am., No. 04-CV-01619-LTB-BNB, 2007 WL 6757307 (D. Colo. Nov. 29, 2007).[1]The full citation is Garcia v. Berkshire Life Ins. Co. of Am., No. 04-CV-01619-LTB-BNB, 2007 WL 6757307 (D. Colo. Nov. 29, 2007), report and recommendation adopted, No. 04-CV-01619-LTB-BNB, 2007 WL … Continue reading jQuery(‘#footnote_plugin_tooltip_15490_2_1’).tooltip({ tip: ‘#footnote_plugin_tooltip_text_15490_2_1’, tipClass: ‘footnote_tooltip’, effect: ‘fade’, predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: ‘top center’, relative: true, offset: [-7, 0], });

Similarly, the Ninth Circuit has found that, where a court “conclud[es] from [a litigant’s] repeated behavior that she [or he] will ‘say anything at any time in order to prevail in this litigation[,]’” it is appropriate for the lower court to have found that it “had no choice but to dismiss” the plaintiff’s litigation. Anheuser-Busch, Inc. v. Nat. Beverage Distributors, 69 F.3d 337, 348 (9th Cir. 1995).

Authority for Terminating Sanctions When a Party Submits and Falsely Authenticates Fabricates Documents

Federal courts have seemingly universally granted motions for terminating sanctions based upon evidence that a party has submitted fabricated documents.

A court has the “inherent authority” to issue “sanctions in response to abusive litigation practices.” Leon v. IDX Sys. Corp., 464 F.3d 951, 958 (9th Cir. 2006). One such sanction is the authority to dismiss a case when “a party has engaged deliberately in deceptive practices that undermine the integrity of judicial proceedings” because “courts have inherent power to dismiss an action when a party has willfully deceived the court and engaged in conduct utterly inconsistent with the orderly administration of justice.” Id. (quoting Anheuser–Busch, Inc. v. Natural Beverage Distribs., 69 F.3d 337, 348 (9th Cir. 1995)). “It is firmly established that the courts have inherent power to dismiss an action or enter a default judgment to ensure the orderly administration of justice and the integrity of their orders.” Phoceene Sous-Marine, S.A. v. U.S. Phosmarine, Inc., 682 F.2d 802, 806 (9th Cir. 1982) (citations omitted). Terminating sanctions may issue only upon a finding of willful disobedience or bad faith. In re Exxon Valdez, 102 F.3d 429, 432 (9th Cir. 1996); Wyle v. R.J. Reynolds Indus., Inc., 709 F.2d 585, 589 (9th Cir. 1983) (the violations must be “due to willfulness, bad faith, or fault of the party”).

Garcia Concluded that Terminating Sanctions Are Appropriate Against a Document Fabricators and Manufacturers

Illustrative of the judicial view that terminating sanctions are appropriate is the fully litigated Garcia case where such sanctions were granted and affirmed by the Tenth Circuit. Garcia v. Berkshire Life Ins. Co. of Am., 2007 WL 6757307, at *8 (D. Colo. Nov. 29, 2007) (“Garcia”).

In Garcia, the plaintiff, Tina Garcia, had “completed law school,” but was not an attorney. The Garcia court noted that the “fabricated e-mail string was presented to [the court] at a hearing…in connection with” a “discovery” motion. Garcia at *6. Ultimately, the Garcia court “f[ou]nd that the plaintiff falsified a report,…and submitted the falsified report to the Colorado Board of Law Examiners.” Garcia at *3. In response, Ms. Garcia argued that the document “has no relevance whatsoever to any disputed issue in this case. Even if it were fabricated, it is not material, let alone significant, to any issue in this case, and therefore cannot be grounds for any sanction, let alone a dispositive sanction.” Garcia at *7. The Garcia court disagreed, stating that: “The great significance of the Lupia e-mail string is that it demonstrates that the plaintiff’s willingness to lie knows no bounds… The plaintiff’s conduct is destructive of the justice system and is intolerable.” Id.

Furthermore, in Garcia, even when the plaintiff was confronted with “overwhelming evidence” of her misdeeds in the motion for sanctions and at the hearing on that motion, “the plaintiff has stubbornly refused to admit her misconduct” in the preparation and use of the false documents. Garcia at *8. The Garcia court found that “substantial doubt exists as to the authenticity of any document relating to this case.” Garcia at *8. The court in Garcia noted that the “fabrications were… calculating, carefully constructed, and self-serving. … It took considerable time, effort, and skill…to falsify the document in such a way that it still made sense…. The plaintiff not only fabricated its contents, but she did it in a way to make it appear to be on Mr. Schoenborn’s letterhead. The Lupia e-mail was fabricated in a sinister effort to besmirch opposing counsel in the eyes of the court. I find that the fabrications were prepared by the plaintiff willfully, knowingly, intentionally, after careful contemplation, for self-serving purposes, and with a full understanding of the impropriety involved.”

Ultimately, Garcia found that: “Without doubt, fabricating evidence and willfully providing false answers during discovery are abusive litigation practices which justify the sanction of dismissal with prejudice.” Garcia at *8. In affirming this decision, the Tenth Circuit stated: “Nor is the exclusion of the fabricated evidence is always enough to deter discovery misconduct. Litigants would infer that they have everything to gain, and nothing to lose, if manufactured evidence merely is excluded while their lawsuit continues.Garcia v. Berkshire Life Ins. Co. Of Am., 569 F.3d 1174, 1180 (10th Cir. 2009).

Numerous Other Courts Also Conclude that There is No Option Other than Terminating Sanctions for Document Fabricators and Photoshoppers

Document Fabrication in Federal Court and Terminating SanctionsGarcia is hardly alone. Numerous other courts have found that: “To permit the fabrication of spurious corroborating evidence without the imposition of a harsh responsive sanction would constitute an open invitation to abuse of the judicial system of the most egregious kind.Asia Pac. Agr. & Forestry Co. v. Sester Farms, 2013 WL 4742934, *11 (D. Or. Sept. 3, 2013); see Valerio v. Boise Cascade Corp., 80 F.R.D. 626, 641 (N.D. Cal. 1978), aff’d, 645 F.2d 699 (9th Cir. 1981) (“Generally speaking, only the most egregious misconduct, such as bribery of a judge or members of a jury, or the fabrication of evidence by a party…will constitute a fraud on the court.”). Even a combination of “misleading, inaccurate, and incomplete responses to discovery requests, the presentation of fraudulent evidence, and the failure to correct the false impression” can constitute fraud on the court. Pumphrey v. K.W. Thompson Tool Co., 62 F.3d 1128, 1132 (9th Cir.1995). Indeed, even an employee’s destruction of data on his employer-owned laptop amounted to willful spoliation of evidence that supported dismissal as sanction. Leon v. IDX Sys. Corp., 464 F.3d 951 (9th Cir. 2006); see Hutchinson v. Hensley Flying Serv., Inc., 210 F.3d 383, (9th Cir.2000) (“Using a falsified document in evidence is sufficient grounds for a dismissal sanction under Rule 11”).

Examples of such cases granting terminating sanctions for fabrication of documents are:

  • Lee v. Trees, Inc., 2017 WL 5147146, at *6 (D. Or. Nov. 6, 2017) granted terminating sanctions upon finding that: “There is no question here that Lee’s conduct threatened to distort the rightful resolution of the case by forcing Defendants to rebut manufactured evidence. The false evidence very well may have obscured the truth and affected the resulting judgment, had it not been for Defendants’ retention of Brillhart, who discovered the fabricated text messages. Lee’s fabricated evidence forced Defendants, at least initially, to proceed in the case on the premise the evidence was authentic when it in fact was false, a result even more egregious than Leon contemplated.”
  • Aoude v. Mobil Oil Corp., 892 F.2d 1115, 1120 (1st Cir. 1989) dismissed for “fraud on the court” where plaintiff attached a bogus agreement to the complaint. “Plaintiff argue[d] that his deceit, if not entirely excusable, falls short of furnishing a basis for dismissal since ‘[t]he attaching of the incorrect agreement to the Complaint … did not in any way interfere with [Defendant’s] ability to litigate the case nor did it interfere in any way with the District Court’s ability to render a ‘rightful decision.’” The Court disagreed, because “[t]he bogus agreement clearly had the capacity to influence the adjudication and to hinder [defendant’s] presentation of its case. . . [and] failure of a party’s corrupt plan does not immunize the defrauder from the consequences of his misconduct.” Id. When the plaintiff “concocted the agreement, and thereafter when he and his counsel annexed it to the complaint, they plainly thought it material. . . [and] ‘are in no position now to dispute its effectiveness.’” Id.
  • Sun World, Inc. v. Lizarazu Olivarria, 144 F.R.D. 384, 390 (E.D. Cal. 1992) found that “Lizarazu admittedly and intentionally defrauded the court by filing the Notice of Termination . . . [and] committed perjury in at least two instances in furtherance of that fraud. . . Lizarazu’s egregious conduct, his lack of repentance and his obvious disregard for this court’s authority force the conclusion that no other sanction would be efficacious.”
  • TeleVideo Systems, Inc. v. Heidenthal, 826 F.2d 915, 917 (9th Cir.1987) affirmed an $11,000,000 “default judgment entered against [the defendant] as a sanction for his perjury during depositions and the false pleadings he filed with the court.”
  • Jackson v. Murphy, 468 Fed.Appx. 616, 620 (7th Cir.2012) affirmed the “sanction of dismissal” where party “both perjured himself and forged a document” in the case.
  • Pope v. Fed. Exp. Corp., 974 F.2d 982, 984 (8th Cir. 1992) found that dismissal of plaintiff’s action was appropriate where plaintiff introduced manufactured evidence and perjured testimony in an attempt to enhance the case.

As explained below, terminating sanctions are the only appropriate remedy when a court is faced with a document fabricator.

The Five-Factor Test Shows that Terminating Sanctions Are Warranted When a Party Falsely Authenticates and Submits Fabricated and Manufactured Documents

The Ninth Circuit has identified five factors that a court must consider before dismissing an action as a sanction:

(1) the public’s interest in expeditious resolution of litigation;

(2) the court’s need to manage its docket;

(3) the risk of prejudice to the other party;

(4) the public policy favoring disposition of cases on their merits; and

(5) the availability of less drastic sanctions.

Leon v. IDX Sys. Corp., 464 F.3d 951, 958 (9th Cir. 2006) (citing Anheuser-Busch, Inc. v. Nat. Beverage Distributors, 69 F.3d 337, 348 (9th Cir. 1995)). This five-factor test is not a rigid, mechanical test but “a way for a district judge to think about what to do, not a series of conditions precedent before the judge can do anything, and not a script for making what the district judge does appeal-proof.” Valley Engineers Inc. v. Elec. Eng’g Co., 158 F.3d 1051, 1057 (9th Cir. 1998). “The first two of these factors favor the imposition of sanctions in most cases, while the fourth cuts against a . . . dismissal sanction. Thus, the key factors are prejudice, and the availability of lesser sanctions.” Wanderer v. Johnston, 910 F.2d 652, 656 (9th Cir. 1990).

As explained below, the factors undoubtedly weigh in favor of the terminating sanction of dismissal with prejudice when a party has fabricated documents.

The Third Factor of Risk of Prejudice Weights in Favor of Dismissal for Document Fabricators, While Other Courts Ignore the Factor Entirely

Some courts have referred to the factor weighing the risk of prejudice to the party moving for dismissal as “not required … but an important factor.” Halaco Eng’g Co. v. Costle, 843 F.2d 376, 382 (9th Cir. 1988) (finding prejudice factor is “purely optional”); United States v. Nat’l Medical Enters., Inc., 792 F.2d 906, 912–913 (9th Cir.1986) (stating prejudice is not required for dismissal).

Regardless, multiple courts have found that the fabrication of evidence necessarily creates prejudice towards the other party. Notably, the Garcia court held that: “The actual prejudice to the defendants is overwhelming. They have been required to defend a lawsuit based on false evidence. Nothing can be relied on as authentic—from the plaintiff’s expert reports; to evidence offered in support of her interrogatory answers; to the evidence offered to the court. The defendants have been put to enormous additional effort and expense to ferret out the plaintiff’s lies and to double check every piece of information and evidence. I have absolutely no confidence that the plaintiff would not attempt to offer additional false evidence at a trial. The risk that this court might issue judgment against the defendants based on the plaintiff’s fabrications and lies is simply too great to allow the case to proceed…. Permitting this lawsuit to proceed would be an open invitation to abuse the judicial process. Litigants would infer they have everything to gain, and nothing to lose, if manufactured evidence merely is excluded while their lawsuit continues. Litigants must know that the courts are not open to persons who would seek justice by fraudulent means.” Garcia v. Berkshire Life Ins. Co. of Am., 2007 WL 6757307, at *9 (D. Colo. Nov. 29, 2007), aff’d in part and remanded, 569 F.3d 1174 (10th Cir. 2009).

On appeal, the Garcia court further explained that: “The submission of falsified evidence substantially prejudices an opposing party by casting doubt on the veracity of all of the culpable party’s submissions throughout litigation. The prejudiced party is forced either to attempt independent corroboration of each submission, at substantial expense of time and money, or to accept the real possibility that … documents submitted by the opposing party are inaccurate.” Garcia v. Berkshire Life Ins. Co. of Am., 569 F.3d 1174, 1180 (10th Cir. 2009)

The court in Aoude v. Mobil Oil Corp., 892 F.2d 1115, 1120 (1st Cir. 1989), reached a similar conclusion. There, the “[p]laintiff argues that his deceit, if not entirely excusable, falls short of furnishing a basis for dismissal since ‘[t]he attaching of the incorrect agreement to the Complaint … did not in any way interfere with [Defendant’s] ability to litigate the case nor did it interfere in any way with the District Court’s ability to render a ‘rightful decision.’” Id.  The Court disagreed, because “[t]he bogus agreement clearly had the capacity to influence the adjudication and to hinder [defendant’s] presentation of its case. . . [and] failure of a party’s corrupt plan does not immunize the defrauder from the consequences of his misconduct.” Id.  When the plaintiff “concocted the agreement, and thereafter when he and his counsel annexed it to the complaint, they plainly thought it material. . . [and] ‘are in no position now to dispute its effectiveness.’” Id.

In Am. Rena Int’l Corp. v. Sis-Joyce Int’l Co., a court in the Central District of California also found that the fabrication of declarations creates prejudice because of “significant costs that would be required to litigate against parties who exhibit little, if any, regard for the integrity of the judicial process.” 2015 WL 12732433, at *30 (C.D. Cal. Dec. 14, 2015). “The court explained that ‘Not all frauds are detected[,] and [t]hey are not easy to detect[,]’ and the “wrongdoer has no right to simply abandon the false evidence and to promise to be honest going forward.” Id. (citing Aptix Corp. v. Quickturn Design Sys., Inc., 2000 WL 852813 (N.D. Cal. 2000)); see Henry v. Gill Indus., Inc., 983 F.2d 943, 947 (9th Cir. 1993) (rejecting party’s argument that any discovery violation was “purged by his [eventually] submitting to deposition” and noting that belated compliance does not preclude sanctions).

When parties have fabricated documents, the third factor indeed weighs in favor of terminating sanctions.

The Fifth Factor of Availability of Less Drastic Sanctions Also Favors Dismissal for Document Photoshoppers, Given That Lesser Sanctions are Inadequate for Document Fabricators

Terminating Sanctions for Document FabricationWhile less severe sanctions theoretically exist, anything less than terminating sanctions, in light of a party’s willful fabrication of evidence and perjury, is woefully inadequate. “[D]ismissal is the only sanction that adequately redresses the severity of Plaintiff’s misrepresentations to this Court” of filing a false and fraudulently procured declaration. Am. Rena Int’l Corp. v. Sis-Joyce Int’l Co., 2015 WL 12732433, at *26 (C.D. Cal. Dec. 14, 2015)

As the Tenth Circuit explained: “the exclusion of the fabricated evidence [is not] always enough to deter discovery misconduct. Litigants would infer that they have everything to gain, and nothing to lose, if manufactured evidence merely is excluded while their lawsuit continues.” Garcia v. Berkshire Life Ins. Co. Of Am., 569 F.3d 1174, 1180 (10th Cir. 2009). Other courts have similarly held that: “[t]o permit the fabrication of spurious corroborating evidence without the imposition of a harsh responsive sanction would constitute an open invitation to abuse of the judicial system of the most egregious kind.” Asia Pac. Agr. & Forestry Co. v. Sester Farms, 2013 WL 4742934, *11 (D. Or. 2013). Upon noting that, had “the fraudulent document not been called into question, the court does not doubt that Lizarazu would have attempted to use it,” a District Court in California found that “Lizarazu’s egregious conduct, his lack of repentance and his obvious disregard for this court’s authority force the conclusion that no other sanction would be efficacious.” Sun World, Inc. v. Lizarazu Olivarria, 144 F.R.D. 384, 390 (E.D. Cal. 1992).

[I]n the context of fraud and deceit, monetary sanctions may be inherently inadequate to remedy the harm to the public interest in preserving the integrity of the courts, and in deterring future misconduct on the part of other litigants.” Battiste v. Virgin Islands Tel. Corp., 48 V.I. 3, 17 (Super. Ct. 2006). In Esposito v. Suffolk Cty. Cmty. Coll., 517 F. Supp. 3d 126, 129 (E.D.N.Y. 2021), upon discovery of the plaintiff’s fabrication of evidence, the district court initially imposed an array of lesser sanctions, including preclusion of the Campo documents, a negative inference instruction to the jury, a $5,000 monetary sanction and an award of attorney’s fees and costs. However, upon a motion for reconsideration, the court found the $5000 sanction inadequate and ordered “plaintiff’s claims . . . DISMISSED in their entirety[,]” noting that “the forged notes occurred as a product of intentional bad faith; they were an attempt to prejudice the Defendants; and they were not corrected by the Plaintiff . . . [and her] refusal to acknowledge her untruthfulness, notwithstanding the overwhelming evidence to the contrary, similarly casts doubt on her candor with the Court and her good-faith participation in the truth-finding process”  Id. at 130-31. In explaining its ultimate ruling, the Esposito court stated:

the Court has no confidence that plaintiff will not continue to engage in misconduct, cannot anticipate the testimony that plaintiff would offer before a jury, and finds that her unrelenting, outrageous conduct thoroughly undermines her credibility. Dismissal is required to remedy the false testimony and fabricated evidence manufactured by this plaintiff; any lesser sanction, on this record, would fail to meet the needs of specific and general deterrence required by plaintiff’s conduct, or provide a just and efficient result in this case.

The Ninth Circuit has explained similarly that: “There is no point to a lawsuit, if it merely applies law to lies. True facts must be the foundation for any just result.” Valley Engineers Inc. v. Elec. Eng’g Co., 158 F.3d 1051, 1058 (9th Cir. 1998). After quoting Valley Engineers, the court in Newman v. Brandon, 2012 WL 4933478, at *4 (E.D. Cal. Oct. 16, 2012) addressing the severity of terminating sanctions commented that:

Perjury is much more than simply a ‘gotcha,’ harmful in effect only for the reason that one got caught. Litigation is not a game in which perjury warrants a five yard penalty for a minor untruth, fifteen yards if the perjury was really serious. … If one can be punished for perjury with up to five years imprisonment, 18 U.S.C. § 1621, it should not seem out of place that a civil action might be dismissed for the same conduct.

Anything less than dismissal is inadequate as there is no reason to believe that a document fabricator to be credible or acting in good faith in any proceedings if the action were to proceed. As the Esposito court explains, under these circumstances there is “no confidence that plaintiff will not continue to engage in misconduct,” or what “testimony that plaintiff would offer before a jury,” given “[his] unrelenting, outrageous conduct thoroughly undermines [his] credibility.” Thus, dismissal is the only remedy.

The First Two Factors of The Public’s Interest in Expeditious Resolution of Litigation and The Court’s Need to Manage Its Docket Normally Weigh in Favor of Dismissal for Document Fabricators, While the Fourth Factor Always Weighs Against Dismissal in Addressing Document Manufactures

“‘The public’s interest in expeditious resolution of litigation always favors dismissal.’” Pagtalunan v. Galaza, 291 F.3d 639, 642 (9th Cir. 2002) (quoting Yourish v. Cal. Amplifier, 191 F.3d 983, 990 (9th Cir. 1999)). Likewise, since addressing the fabricated evidence, Plaintiff presented “has consumed some of the court’s time that could have been devoted to other cases on the docket[,]” the second factor, the Court’s need to manage its docket, “also weighs in favor of dismissal.” Pagtalunan, 291 F.3d at 642. On the other hand, “[t]he fourth factor, resolution of cases on their merits, always weighs against dismissal.” Dreith v. Nu Image, Inc., 648 F.3d 779, 788 (9th Cir. 2011). Overall, the factors weight clearly in favor of the sanction of dismissal.

Fabrication of Documents is Undeniably Due to Willfulness, Bad Faith, or Fault of the Party

The only remaining requirement for terminating sanctions is that the violations must be “due to willfulness, bad faith, or fault of the party.” Wyle v. R.J. Reynolds Indus., Inc., 709 F.2d 585, 589 (9th Cir. 1983). “[A]ll litigants, including pro ses, have an obligation to comply with court orders. When they flout that obligation, they, like all litigants, must suffer the consequences of their actions.” McDonald v. Head Crim. Court Supervisor Officer, 850 F.2d 121, 124 (2d Cir. 1988). The court in Garcia found “that the fabrications were prepared by the plaintiff willfully, knowingly, intentionally, after careful contemplation, for self-serving purposes, and with a full understanding of the impropriety involved.” Another court found that: “Because Plaintiff himself drafted these false declarations and obtained signatures on them using trickery, the Court finds that Plaintiff knew the documents were falsified. Thus, the Court has no hesitation in finding that Plaintiff’s actions were willful and made in bad faith.” Newman v. Brandon, No. 1:10-CV-00687 AWI JL, 2012 WL 4933478, at *4 (E.D. Cal. Oct. 16, 2012).

The fabrication of documents involves carefully contemplated actions for self-serving purposes to advance theories in the accompanying pleadings. As it turns out, such actions constitute the basis of this unavoidable motion for terminating sanctions with prejudice.

Dismissal With Prejudice Will Indeed Result in a Final Judgment “On the Merits” When Federal Courts Address Document Fabricators

There is no question that terminating sanctions will resolve a case forever. FRCP, Rule 41(b) provides as follows: “Involuntary Dismissal; Effect. If the plaintiff fails to prosecute or to comply with these rules or a court order, a defendant may move to dismiss the action or any claim against it. Unless the dismissal order states otherwise, a dismissal under this subdivision (b) and any dismissal not under this rule—except one for lack of jurisdiction, improper venue, or failure to join a party under Rule 19—operates as an adjudication on the merits.”

As explained by the Ninth Circuit, the law is that “dismissal with prejudice has res judicata effect. There can be little doubt that a dismissal with prejudice bars any further action between the parties on the issues subtended by the case,” meaning that “the plaintiff is precluded from bringing another action for the same cause when the dismissal of his action with prejudice stands. Those dismissals have res judicata effect because, it is said, they are on the merits, and under res judicata, a final judgment on the merits bars further claims by parties or their privies based on the same cause of action.” In re Marino, 181 F.3d 1142, 1144 (9th Cir. 1999); see Hells Canyon Preservation Council v. United States Forest Serv., 403 F.3d 683, 686 (9th Cir. 2005) (“Final judgment on the merits” is synonymous with “dismissal with prejudice.”); United States v. $149,345 U.S. Currency, 747 F.2d 1278, 1280 (9th Cir. 1984) (holding that the dismissal of a prior action as a sanction “is a judgment on the merits within the meaning of Fed. R. Civ. P. 41(b), and operates as res judicata to bar a second suit”).

As Wright and Miller explain the simplicity of this answer: “Penalty dismissals provide a category in which there is little need to venture beyond Civil Rule 41(b) in search of preclusion answers.” “On the Merits”—Penalty Dismissals, 18A Fed. Prac. & Proc. Juris. (3d ed.) § 4440. Wright and Miller cite to a First Circuit decision described as follows: “Dismissal of the first-filed action for fraud on the court in filing a knowingly forged document effectively barred the plaintiff from asserting the same rights in a second parallel action filed after the fraud was discovered.” Id. (discussing Aoude v. Mobil Oil Corp., 892 F.2d 1115, 1121–1122 (1st Cir. 1989)).

“Res judicata, or claim preclusion, prohibits lawsuits on any claims that were raised or could have been raised in a prior action. Res judicata applies when there is: (1) an identity of claims; (2) a final judgment on the merits; and (3) identity or privity between parties… The phrase ‘final judgment on the merits’ is often used interchangeably with ‘dismissal with prejudice.’” Stewart v. U.S. Bancorp, 297 F.3d 953, 956 (9th Cir. 2002) (citations and quotations omitted).

Accordingly, a judgment dismissing a case with prejudice would be on the merits under FRCP 41(b), meaning that that the plaintiff could not re-file another action in relation to the matter, or the defendant would be prohibited from defending the action upon an answer being stricken and entry of default being taken.

Courts Should Follow What Appears to be Every United States Federal Court Faced With a Motion for Terminating Sanctions Due to Document Forgery by Dismissing the Action With Prejudice

Federal courts have a universal opinion when faced with terminating sanctions against litigants who submit bogus documents. As the First Circuit said: “Appellant chose to play fast and loose with Mobil and with the district court. He was caught out. The judge considered the relevant factors and acted well within his discretion: appellant’s brazen conduct merited so extreme a sanction; Mobil, having undergone extra trouble and expense, had a legitimate claim to dismissal; and the court, jealous of its integrity and concerned about deterrence, was entitled to send a message, loud and clear.” Aoude v. Mobil Oil Corp., 892 F.2d 1115, 1122 (1st Cir. 1989).

Consult with an Attorney Experienced in Litigating Terminating Sanctions

If you have been the victim of someone who has forged documents or otherwise manufactured evidence, it is important to speak with a real estate litigation, bankruptcy litigation, business litigation, family law, or trust, estate, and probate litigation attorney as soon as possible. Talkov Law’s litigation attorneys can be reached at (844) 4-TALKOV (825568) or info(at)talkovlaw.com

References[+]

References
1 The full citation is Garcia v. Berkshire Life Ins. Co. of Am., No. 04-CV-01619-LTB-BNB, 2007 WL 6757307 (D. Colo. Nov. 29, 2007)report and recommendation adopted, No. 04-CV-01619-LTB-BNB, 2007 WL 4578333 (D. Colo. Dec. 27, 2007), amended, No. 04-CV-01619-LTB-BNB, 2008 WL 619307 (D. Colo. Mar. 4, 2008), amended, No. CIV04CV-01619-LTBBNB, 2008 WL 732608 (D. Colo. Mar. 18, 2008), and amended, No. CIV04CV-01619-LTBBNB, 2008 WL 732608 (D. Colo. Mar. 18, 2008), and aff’d in part and remanded, 569 F.3d 1174 (10th Cir. 2009). All citations herein to “Garcia” are to the Nov. 29, 2007 decision in Garcia v. Berkshire Life Ins. Co. of Am., No. 04-CV-01619-LTB-BNB, 2007 WL 6757307 (D. Colo. Nov. 29, 2007).

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