## Facts

- Thousands of federal products-liability cases involving Actos (pioglitazone) were centralized in an MDL in the Western District of Louisiana.
- Plaintiffs alleged Actos use increased bladder-cancer risk and that Takeda failed to test adequately and warn, and withheld risk information.
- Plaintiffs moved for spoliation sanctions under the court’s inherent authority and Federal Rule of Civil Procedure 37, seeking default judgment or severe alternative sanctions.
- The court found Takeda’s duty to preserve relevant evidence arose well before the MDL, when litigation was reasonably anticipated amid regulatory scrutiny and emerging claims.
- Despite litigation holds, Takeda failed to stop auto-deletion and other routine information-destruction processes for many custodians.
- The court found substantial loss of relevant ESI and documents, including material from dozens of key custodians involved in regulatory, safety, clinical, and marketing functions.
- The court found Takeda’s preservation failures were repeated and widespread, and that disclosures about the scope of loss were incomplete and delayed.
- The court found plaintiffs were prejudiced because the missing materials likely bore on Takeda’s knowledge of risk, internal decision-making, and communications with regulators and partners.

## Issues

1. Whether Takeda’s loss and destruction of relevant evidence after a duty to preserve arose constituted sanctionable spoliation under Rule 37 and/or the court’s inherent authority.
2. If spoliation occurred, whether the proper remedy was default judgment or a lesser set of evidentiary, monetary, and remedial sanctions tailored to culpability and prejudice.

## Decision

- The court found Takeda failed to preserve and destroyed relevant evidence it had a duty to preserve, and that the conduct warranted severe sanctions.
- The court found the spoliation caused prejudice to plaintiffs on core liability issues.
- The court denied plaintiffs’ request for default judgment as too drastic in the MDL context.
- The court imposed strong non-dispositive sanctions, including a permissive adverse-inference-type jury instruction for bellwether trials.
- The court ordered monetary relief (including fees and expenses tied to the spoliation dispute and remedial efforts) and directed further technical/remedial measures to locate and restore remaining ESI.

## Legal Principles

- The duty to preserve arises when litigation is reasonably anticipated; failure to preserve relevant information after that point may be sanctioned under Rule 37 and/or inherent authority.
- Severe spoliation sanctions generally require: (1) a duty to preserve, (2) culpable conduct (including intentional destruction or willful disregard), and (3) prejudice to the opposing party.
- Prejudice may be shown by loss of potentially probative evidence central to disputed issues, including the lost opportunity to present the evidence to the factfinder.
- Sanctions must be proportionate to culpability and prejudice and should be structured to reduce evidentiary imbalance; case-dispositive relief is reserved for extreme circumstances.

## Conclusion

The MDL court concluded that Takeda’s widespread, bad-faith destruction of relevant evidence after preservation duties attached justified severe evidentiary and monetary sanctions, but that default judgment was disproportionate given the case posture and the individualized issues remaining across the consolidated actions.


In re Actos (Pioglitazone) Prods. Liab. Litig., 2014 WL 2872299 (W.D. La. 2014)