eDiscovery Daily Blog

Court Denies Sanctions Request Because Defendant Didn’t Prove the Information was Irretrievable: eDiscovery Case Law

In Envy Hawaii LLC v. Volvo Car USA LLC, No. 17-00040 HG-RT (D. Haw. Mar. 20, 2019), Hawaii District Judge Helen Gillmor denied the defendant’s motion for spoliation sanctions, stating that the defendant “has not established that spoliation sanctions are available because the information it seeks is not “lost” within the meaning of Fed. R. Civ. P. 37(e).”

Case Background

In this case involves contract disputes and claims of improper business practices between a local automobile dealership and the national distributor of Volvo automobiles, the parties had engaged in two years of litigation, produced discovery, and conducted depositions.  The defendant claimed that the plaintiff and its sole owner and manager failed to preserve certain electronically stored information (Google e-mail accounts and electronic dealer management system records) in violation of Federal Rule of Civil Procedure 37(e).  The plaintiff and its owner claimed no spoliation had occurred because any relevant records are available from third-parties and sanctions were not appropriate.

Judge’s Ruling

Judge Gilmor noted that “[t]he text of Federal Rule of Civil Procedure 37(e) provides that evidence is ‘lost’ and subject to spoliation sanctions when a party failed to take reasonable steps to preserve it, and ‘it cannot be restored or replaced through additional discovery’” and that “[i]nformation is ‘lost’ for purposes of Rule 37(e) only if it is irretrievable from another source, including other custodians.”  She also stated that “[s]poliation sanctions are not available pursuant to the 2015 Amendment to Rule 37(e) when information is not lost.”

With regard to that, Judge Gilmor stated:

“Volvo Car USA LLC admits that it has not sought any of the discovery from either CDK Disk or Google Enterprise. Volvo Car USA LLC’s Motion is focused on Envy Hawaii LLC’s failure to preserve the information.”

Noting that “Volvo Car USA LLC may issue subpoenas to obtain records from Google and/or CDK Drive prior to May 15, 2019”, Judge Gilmor denied the defendant’s motion for spoliation sanctions.

So, what do you think?  Should parties be required to confirm with third parties that information is not available before filing motions for spoliation sanctions?  Please let us know if any comments you might have or if you’d like to know more about a particular topic.

Case opinion link courtesy of eDiscovery Assistant.

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