Bahena v. Goodyear Tire & Rubber Co.

*608OPINION

By the Court,

On July 1, 2010, this court issued an opinion in these appeals. Bahena v. Goodyear Tire & Rubber Co. (Bahena I), 126 Nev. 243, 235 P.3d 592 (2010). In Bahena I, we addressed whether the district court’s sanction of striking Goodyear’s answer as to liability and only allowing it to contest damages was proper and whether an evidentiary hearing was required when the sanction was a non-case concluding sanction. We ultimately upheld the sanction and ruled that when a sanction is non-case concluding, an evidentiary hearing is not mandatory. Respondent Goodyear and amici curiae seek rehearing of that opinion. Although rehearing is not warranted, we address a number of the issues raised by Goodyear and the amici in order to clarify Bahena I. Because the facts and procedural history in this case were set forth in our prior opinion, we do not recount them here except as necessary for our disposition of the instant petition for rehearing.

Standard of review

We will consider rehearing when we have overlooked or misapprehended material facts or questions of law or when we have overlooked, misapplied, or failed to consider legal authority directly controlling a dispositive issue in the appeal. NRAP 40(c)(2). In *609Gordon v. District Court, 114 Nev. 744, 745, 961 P.2d 142, 143 (1998), we discussed the proper purpose for petitions for rehearing: “‘[ujnder our long established practice, rehearings are not granted to review matters that are of no practical consequence. Rather, a petition for rehearing will be entertained only when the court has overlooked or misapprehended some material matter, or when otherwise necessary to promote substantial justice.’ ” (quoting In re Herrmann, 100 Nev. 149, 151, 679 P.2d 246, 247 (1984)).

DISCUSSION

In Bahena I, this court did not overlook or misapprehend any material matters, nor did we overlook, misapply, or fail to consider controlling legal authority. Accordingly, we deny rehearing. NRAP 40(c)(2). However, we take this opportunity to clarify certain holdings and legal conclusions set forth in our prior opinion and discuss authority cited or discussed by Goodyear and the amici in support of the petition for rehearing.

Goodyear argues that Bahena I misapplied Nevada law, deprived Goodyear of due process, created an unfair double standard between plaintiffs and defendants, and is against the weight of other jurisdictions’ authority. We disagree. We followed clear Nevada precedent in Bahena I. Goodyear enjoyed sufficient due process in this matter, and plaintiffs and defendants receive similar treatment for discovery abuses under Nevada law. Additionally, while other jurisidictions’ caselaw is not controlling, we note that the state cases relied upon by Goodyear and amici do not support the proposition for which Goodyear argues — that defendants are always entitled to an evidentiary hearing before their answers are stricken as to liability only.

Nevada caselaw

As set forth in Bahena I, 126 Nev. 243, 235 P.3d 592, the leading Nevada Supreme Court case regarding the issue of sanctions is Young v. Johnny Ribeiro Building, 106 Nev. 88, 787 P.2d 111 (1990). In Young, the court affirmed the decision to dismiss Young’s complaint and discussed our standard of review of abuse of discretion. We stated that “[ejven if we would not have imposed such sanctions in the first instance, we will not substitute our judgment for that of the district court.” Id. at 92, 787 P.2d at 779. The Nevada Supreme Court concluded that “while dismissal need not be preceded by other less severe sanctions, it should be imposed only after thoughtful consideration of all the factors involved in a particular case.” Id. at 92, 787 P.2d at 780 (emphasis added). In Foster v. Dingwall, 126 Nev. 56, 227 P.3d 1042 (2010), *610we reiterated the holding in Young by affirming discovery sanctions of entry of a default judgment. The majority in Foster concluded that NRCP 37(b)(2)(C) and 37(d) specifically and independently provide that a court may strike a party’s pleadings if that party fails to obey a discovery order or fails to attend his or her own deposition. 126 Nev. at 65, 227 P.3d at 1048. Finally, we concluded that the sanctions “were necessary to demonstrate to future litigants that they are not free to act with wayward disregard of a court’s orders,” and that the conduct of the appellants evidenced “their willful and recalcitrant disregard of the judicial process.” 126 Nev at 66, 227 P.3d at 1049.

Nevada jurisprudence does not follow the federal model of requiring progressive sanctions against a party for failing to comply with a discovery order or for failing to attend their deposition. In Higgs v. State, 126 Nev. 1, 17, 222 P.3d 648, 658 (2010), we concluded that with respect to the admissibility of expert testimony, Nevada law controls, and that we only look “at federal jurisprudence for guidance — when needed.” We further concluded that evidentiary authority “allows the trial judge discretion in deciding what factors are to be considered on a case-by-case basis.” 126 Nev. at 18, 222 P.3d at 659. We hold that this framework also applies to discovery sanctions.

Due process and the sufficiency of the January 18, 2007, hearing

The hearing held by the district court on January 18, 2007, was sufficient based upon the facts and circumstances of this case. The only witnesses to the discovery dispute were the respective attorneys for Bahena and Goodyear. These attorneys are all officers of the court. Their conduct is governed by Nevada Rule of Professional Conduct (RPC) 3.3, which addresses the stándards of candor that a lawyer must have towards a court. This rule provides that the lawyers must not make a false statement of fact or law to a tribunal, fail to correct a false statement of material fact or law previously made to the tribunal by the lawyer, or offer evidence that the lawyer knows to be false. The district court heard all the factual representations of the respective lawyers and asked them questions at the hearing. Representations of the respective lawyers were sufficient for the district court to question the lawyers about the deposition and document production dispute without the necessity of cross-examination.1

*611We concluded in Bahena I that the district court should “hold such hearing as it reasonably deems necessary to consider matters that are pertinent to the imposition of appropriate sanctions. The length and nature of the hearing for non-case concluding sanctions shall be left to the sound discretion of the district court.” 126 Nev. at 256, 235 P.3d at 601. This standard set forth in Bahena I provides sufficient due process and creates a more extensive requirement for hearings before entry of default as to liability only than many other state jurisdictions cited by Goodyear and discussed below. The district court’s hearing on January 18, 2007, was sufficient, and the district court judge properly received factual representations from officers of the court pursuant to RPC 3.3.2

While we reject Goodyear’s argument to mandate evidentiary hearings in all cases before a district court may strike a defendant’s answer as to liability only, we agree in part with our dissenting colleague that district courts should be encouraged to exercise their discretion to hold evidentiary hearings regarding non-case concluding sanctions when requested and when there are disputed issues of material fact regarding the discovery dispute identified by the parties. Examination of witnesses who have personal knowledge of the material issues of fact in dispute may assist the district courts in making findings of fact. Although Goodyear requested an evidentiary hearing, it did not make an offer of proof to the district court as to what evidence should be considered in addition to the representations of counsel.

Double standard

Goodyear argues that the failure to require a full evidentiary hearing in cases where the court strikes the defendant’s answer as *612to liability only, but not as to damages, creates a double standard between plaintiffs and defendants. We disagree.

Goodyear relies upon the case of Nevada Power v. Fluor Illinois, 108 Nev. 638, 837 P.2d 1354 (1992), to support its argument that a full evidentiary hearing is necessary when an answer is going to be dismissed as to liability. Goodyear incorrectly relies on this case because in Nevada Power, the district court dismissed the complaint of Nevada Power with prejudice without conducting an evidentiary hearing regarding alleged discovery abuses. Since the district court entered its order dismissing Nevada Power’s complaint with prejudice, the case was over. The only remedy Nevada Power had was to appeal; therefore, an evidentiary hearing was appropriate. In Bahena, the district court struck Goodyear’s answer as to liability only, but Goodyear had the full right to contest general, special, and punitive damages. In fact, Goodyear prevailed upon Bahena’s claim for punitive damages. As distinguished from Nevada Power, Goodyear was not out of court based upon the district court’s sanction order. Therefore, we decline to extend the holding of Nevada Power for non-case concluding discovery sanctions.

Authority from other states

Goodyear argues that authority in other jurisdictions supports the proposition that striking an answer as to liability only is an “ultimate” sanction that requires heightened due process — which Goodyear equates to requiring the district court to hold an evidentiary hearing before an answer can be stricken as to liability only. Nevada law, of course, controls in this case and, as discussed above, Bahena I is in accordance with Nevada precedent and meets due process requirements. However, we also disagree that the state cases cited by Goodyear can be interpreted so broadly; consistent with Nevada law, none of them mandate that an evidentiary hearing be held in all cases before a trial court can strike a defendant’s answer as to liability only.

In some of the cases discussed by Goodyear, the appellate court affirmed the striking of a defendant’s answer or a plaintiff’s complaint even when there was no evidentiary hearing on the motion to strike. See State Farm v. Health Horizons, 590. S.E.2d 798 (Ga. Ct. App. 2003); Sims v. Fitzpatrick, 288 S.W.3d 93 (Tex. Ct. App. 2009) (affirming the trial court’s imposition of death penalty sanctions as to liability only after it conducted a nonevidentiary hearing because it has the inherent power to impose sanctions that are not covered by a specific court rule for the conduct of the appellants of purposefully delaying the case and because it made specific findings of fact in support of its sanctions; the court of appeals further held that the appellants were entitled to a jury trial *613upon the issue of damages). Also, in Burton v. Sparler, 613 S.W.2d 394 (Ark. 1981), the court affirmed the trial court’s order dismissing plaintiff’s complaint and entering a default against the plaintiff on defendant’s counterclaim, which was entered without an evidentiary hearing being held.

In the cases cited by Goodyear and the amici in which the striking of an answer was reversed, evidentiary hearings were required based upon the specific facts of those cases — not because such hearings are always required.3 See Robinson v. Higuera, 760 P.2d 622, 624 (Ariz. Ct. App. 1988) (reversing the trial court’s decision to strike an answer without a hearing and to enter a default judgment as to both liability and damages for violation of a discovery order, but noting that “[d]ue process does not require that a hearing be held in every case prior to imposition of Rule 37(b)(2) sanctions of dismissal or entry of default judgment”); Roberts v. Roberts, 629 A.2d 1160 (Conn. App. Ct. 1993) (holding that an evidentiary hearing was needed based on the specific facts in the case requiring a determination as to whether a sale by auction of marital property was the best way to effectuate the original judgment when one of the parties objected to selling the property this way). The Illinois case cited by Goodyear and the amici concluded that evidentiary hearings may be necessary before imposing discovery sanctions when a unique factual situation is presented. Shimanovsky v. General Motors Corp., 692 N.E.2d 286 (Ill. 1998) (concluding the hearing was necessary because the plaintiff had conducted destructive testing on the General Motors vehicle prior to filing the products liability claim and the trial court needed to consider the degree of destructive testing done to determine the prejudice to General Motors).

Goodyear cites to a Texas case in which the Texas Supreme Court instructed the district court to impose less stringent discovery sanctions; however, the Texas Supreme Court made the instruction because of the specific facts present in that case. TransAmerican Natural Gas v. Powell, 811 S.W.2d 913 (Tex. 1991) (reasoning that the district court did not indicate that it had considered less severe sanctions before striking the defendant’s answer and that the violation was that the parties could not mutually agree to a new deposition date for the president of TransAmerican). In the other Texas cases cited by Goodyear, the Texas appellate courts reversed the trial courts’ sanctions because Rule 215 of the Texas Rules of Civil Procedure provides that sanctions must be proportionate to the violation. Chrysler Corp. v. Blackmon, 841 S.W.2d 844 (Tex. 1992) (also concluding that trial courts are not *614required to make written findings for discovery sanctions); In re Carnival Corp., 193 S.W.3d 229 (Tex. Ct. App. 2006).

Goodyear cites to Georgia cases in which the appellate courts have remanded cases to the trial courts to conduct an evidentiary hearing on discovery sanctions to determine willfulness of the discovery violation; however, in these cases, the courts have stated that while the hearing was necessary under the present facts, the trial courts need not conduct a hearing to determine willfulness in every case based upon a party’s failure to comply with discovery. McConnell v. Wright, 644 S.E.2d 111 (Ga. 2007) (concluding the hearing was necessary to determine if the plaintiffs willfully failed to attend their depositions); General Motors Corp. v. Conkle, 486 S.E.2d 180 (Ga. Ct. App. 1997) (concluding the hearing was necessary because the trial court had not set forth the statutory basis for the discovery sanctions and it had not made specific findings of willfulness and bad faith when General Motors had partially complied with the discovery order and was continuing to attempt to comply with the discovery order).

In other cases discussed by Goodyear, whether or not there was an evidentiary hearing before an answer was stricken for violating a discovery order, the courts speak to the trial courts’ broad authority to impose severe sanctions when the circumstances warrant it. See State Farm, 590 S.E.2d at 800 (concluding that an order to compel does not have to be completely violated before the trial court can grant a motion to strike, that the trial court has broad discretion to control litigation, and that an appellate court will affirm a trial court’s finding of willful refusal to comply with discovery if any evidence supports the trial court’s findings); Schultz v. Sykes, 638 N.W.2d 604 (Wis. Ct. App. 2001) (holding that the trial court has the inherent authority to investigate the facts of the case, so it has the discretion and authority to set an evidentiary hearing to conduct its investigation when it sees fit).

Goodyear and the amici argue that Pinkstaff v. Black & Decker (U.S.) Inc., 211 P.3d 698, 704 (Colo. 2009), is applicable here because the Colorado Supreme Court reversed the imposition of discovery sanctions finding that they were unduly harsh and not commensurate with the harm done.4 In reaching this decision, the Colorado Supreme Court held that the district court did not put on the record or enter a written order that it had considered the full range of lesser sanctions before striking Black & Decker’s answer as to liability and that all the discovery documents were produced *615within 30 days after the court-ordered deadline expired.5 Id. While the Colorado Supreme Court recognizes that striking an answer as to liability represents the harshest of all sanctions,6 the majority stated that a trial court does not abuse its discretion when it imposes severe sanctions based upon extensive nondisclosure or wholesale failure to prosecute a case. Id. at 703-04. Ultimately, Colorado law does not require an evidentiary hearing before a district court may strike a defendant’s answer as to liability, but does require that sanctions be proportional to the violation. See Pinkstaff, 211 P.3d at 703-04; Kwik Way Stores, Inc. v. Caldwell, 745 P.2d 672 (Colo. 1987).

CONCLUSION

In conclusion, our precedent is clear under Young v. Johnny Ribeiro Building and Foster v. Dingwall that the district court had the discretion to strike Goodyear’s answer as to liability only based upon Goodyear’s failure to attend its own deposition under NRCP 37(d) and the district court’s inherent equitable power to access the appropriate sanctions based upon the criteria of willfulness, bad faith, and prejudice. Because we did not overlook or misapprehend any material matters, nor did we overlook, misapply, or fail to consider controlling legal authority the petition for rehearing is denied.