Calsep A/S v. Dabral

Calsep alleged its PVT-simulation trade secrets were used to build a competing product. The court ordered production of the defendant's source-code control system in unmodified form — the version history that would show whether Calsep's code seeded the competitor. Data was deleted from that system during discovery, some of it days after the orders. The question was whether litigation-ending sanctions were justified, and later, whether forensic images found in a storage unit in India required reopening them.

In the Fifth Circuit, a litigation-ending sanction requires findings beyond Rule 37 itself: the violation was willful or in bad faith and attributable to the client rather than counsel, it substantially prejudiced the opposing party, and no lesser sanction would substantially achieve deterrence. Knowingly ignoring a discovery obligation, especially repeatedly and after warnings, may alone support the bad-faith finding.

The record checked every box. Dabral slow-walked production, deleted electronic evidence during discovery — including days after court orders — misrepresented the existence of a second control-system server, and, given a last chance to come clean, produced a copy with still more files missing. His own expert described the deletions as seemingly intentional and post-suit. Version history is exactly the evidence that proves or disproves derivation in a software trade-secret case, so its destruction gutted Calsep's ability to try the case on the merits.

Default judgment affirmed, with damages and fees. The court also affirmed the refusal to reopen: the forensic images Dabral produced seven months later from an Indian storage unit were not new evidence, because he had known of them and failed to show he could not have produced them with reasonable diligence — and the sanctions rested on far more than the data those images restored.