Civil Practice – Severe Sanctions – Motion to Compel – Discovery – Misappropriation of Trade Secrets – Unfair or Deceptive Trade Practices

Severe sanctions are warranted after defendant stalled the progress of this case, prejudiced plaintiff, and wasted judicial resources.

We granted the motion to sanction defendant.

For the second time, plaintiff Airtron, Inc. moved to sanction defendant Bradley Allen Heinrich for disobeying the court’s discovery orders and related litigation misconduct. Airtron sued Heinrich in 2022, along with several others who have since settled or otherwise been dismissed. The amended complaint asserted claims against Heinrich for misappropriation of trade secrets and unfair or deceptive trade practices under N.C.G.S. §75-1.1.

It was undisputed that Heinrich has not complied with the court’s order on Airtron’s motion to compel. The court directed Heinrich to respond fully and completely to Airtron’s requests for production, to produce responsive documents in his possession, and to identify any requests for which no responsive documents exist. But he has not responded to the requests for production at all. Many of his interrogatory responses also remain deficient.

Heinrich’s repeated failures to comply with the court’s discovery orders merit severe sanctions, including striking his answer and entering default judgment against him. The court has considered lesser sanctions and finds them to be insufficient. This is Heinrich’s second failure to obey a discovery order, and the relatively light sanctions imposed after the first failure seem to have had no effect. That Heinrich is representing himself is no excuse. Heinrich defaulted on his discovery obligations even after receiving clear instructions to cure the deficient responses and a clear warning that severe sanctions could follow if he did not. His utter indifference to the requests for production goes beyond noncompliance. It is dereliction. And there is little reason to believe that he would fulfill his obligations if given yet another chance.

Moreover, the prejudice to Airtron is undeniable. Its discovery requests have been pending well over a year. By not responding or responding with generalities, Heinrich has stymied Airtron’s efforts to investigate its claims. Likewise, his failure to meet his discovery obligations has frozen this litigation in place, forced Airtron to waste time and money to compel responses, and foreclosed a resolution on the merits.

A few aggravating factors also favor severe sanctions. First, Heinrich disobeyed other orders, including the recent order to reimburse Airtron for nearly $4,000 in attorney’s fees incurred in connection with its motion to compel. Second, Airtron offered unrebutted evidence that Heinrich made false statements in his interrogatory responses. Third, Airtron offered unrebutted evidence that Heinrich mistreated the court reporter during his deposition.

Heinrich has stalled the progress of this case, prejudiced Airtron, and wasted judicial resources. The court concluded that severe sanctions are warranted and will therefore strike his answer and enter default judgment against him.

Finally, Airtron has stated claims for misappropriation of trade secrets and unfair or deceptive trade practices under section 75-1.1. The court will therefore enter a default judgment as to liability, leaving a determination of Airtron’s damages—including whether it is entitled to the punitive damages and attorneys’ fees that it seeks—to a future proceeding.

Granted.

Airtron Inc. v. Heinrich (Lawyers’ Weekly No. 020-018-24, 9 pp.) (Adam M. Conrad, J.) 2024 NCBC 18. Ogletree, Deakins, Nash, Smoak & Stewart, P.C., by Paul S. Holscher and Charlotte C. Smith, for plaintiff Airtron, Inc.; Defendant Bradley Allen Heinrich appeared pro se. North Carolina Business Court