Discovery sanctions are penalties a court imposes on a party in a lawsuit for mishandling discovery — the pre-trial stage where each side must search for, preserve, and hand over evidence relevant to the case. They range from a fine to a judge simply deciding the case against the offending party, and courts use them to punish and deter cheating during fact-finding, before a jury ever hears the underlying dispute.

What counts as discovery misconduct

Discovery misconduct covers a range of behavior, not just outright destruction of evidence. Common examples include:

  • Withholding a known capability. Telling the court a search or export can’t be done, when it in fact can.
  • Evasive or incomplete answers. Technically responding to a request without actually answering it.
  • Producing unusable evidence. Handing over documents so heavily redacted, or in such a disorganized form, that the other side can’t actually use them.
  • Spoliation. Losing, altering, or destroying evidence that should have been preserved — the most serious category, sometimes called spoliation of evidence.

In US federal court, this is governed mainly by Rule 37 of the Federal Rules of Civil Procedure, with a specific 2015 amendment — Rule 37(e) — addressing the loss of electronically stored information such as emails, internal logs, or database records.

What the penalties actually look like

Courts have a menu of remedies, roughly escalating with how serious and deliberate the misconduct was:

  • Monetary sanctions. The offending party pays the other side’s attorneys’ and experts’ fees spent chasing down the missing or mishandled evidence.
  • Evidentiary sanctions. The judge bars the offending party from using the disputed material, or from making arguments that depend on it.
  • Adverse inference instructions. The judge tells the jury it may assume the missing or hidden evidence would have hurt the offending party’s case — a significant blow, since juries tend to follow such instructions closely.
  • Case-dispositive sanctions. In the most extreme cases, a judge can strike a party’s claims or defenses entirely, or enter default judgment — effectively deciding the lawsuit as a penalty, without a trial on the merits.

Under Rule 37(e), US federal courts reserve the harshest of these — the adverse inference and case-ending sanctions — for cases where a party is found to have acted with actual intent to deprive the other side of the evidence, not just carelessness.

Why this matters for AI lawsuits

Discovery has become a central battleground in the wave of copyright lawsuits against AI companies, because the evidence that matters most — what data trained a model, and what a model actually outputs — usually exists only on the AI company’s own servers. Plaintiffs can’t independently verify a company’s claims about its own logs and training pipelines; they depend on the company to search for and hand over that evidence honestly.

That dependency is exactly what makes discovery disputes so consequential in this wave of litigation. If a court finds a company misrepresented what it could search for, or handed over data in a deliberately unusable form, the resulting sanction can shape the outcome of the underlying copyright case before a jury even weighs in — for instance, through an instruction telling jurors to treat the disputed evidence as proof of copying.

In the news

A group of publishers led by The New York Times has asked a federal court to sanction OpenAI, arguing the company spent two years denying it could search its models and internal logs for the publishers’ copyrighted articles — then had an employee testify that such searches had, in fact, been run. Read our report: NYT-Led Publishers Ask Court to Sanction OpenAI Over Evidence.

FAQ

Is discovery misconduct the same as spoliation? No. Spoliation specifically means evidence was lost, altered, or destroyed. Discovery misconduct is the broader category, which also includes withholding, misrepresenting, or producing evidence in an unusable form.

Can discovery sanctions end a lawsuit before trial? Yes, in the most serious cases. Courts can strike a party’s claims or defenses, or enter default judgment, as a sanction — though this is reserved for intentional or especially egregious misconduct.

Do these rules only apply in the US? The specific mechanics described here are from US federal procedure. Most legal systems have their own equivalent rules requiring parties to preserve and disclose relevant evidence, with their own penalties for violations.

Sources: Federal Rules of Civil Procedure, Rule 37 (Cornell Law School’s Legal Information Institute); Bloomberg Law reporting on In re OpenAI, Inc. Copyright Infringement Litigation.