Preservation

Court Opts for Lesser Sanction for Failure to Preserve Electronic Vehicle Data: eDiscovery Case Law

In Barry v. Big M Transportation, Inc., et al., No. 1:16-cv-00167-JEO (N.D. Ala. Sep. 11, 2017), Alabama Chief Magistrate Judge John E. Ott denied the plaintiffs’ request for default judgment sanctions for failing to preserve a tractor-trailer involved in an automobile accident and its “Electronic Data/Electronic Control Module (ECM) Vehicle Data Recorder/Black Box” and the data associated with the ECM device.  As an alternative sanction, Judge Ott indicated the intent to tell the jury that the ECM data was not preserved and to allow the parties to present evidence and argument at trial regarding the defendant’s failure to preserve the data.

Case Background

In this case arising out of a motor vehicle accident which was filed in Alabama state court and then removed to federal court, the plaintiffs sought to recover compensatory and punitive damages for their injuries and asserted claims against the trucking company and the driver of the truck.  Both defendants filed a motion for summary judgment on the plaintiffs’ claims and the plaintiffs filed a motion for partial summary judgment on the defendants’ affirmative defenses of contributory negligence, assumption of the risk, and intervening cause, as well as a “spoliation sanction” in the form of either a default judgment on the defendants’ negligence liability or an order judicially establishing certain facts against the defendants.

As a part of their motion for partial summary judgment, the plaintiffs requested a spoliation sanction against the defendants for their failure to preserve the tractor’s ECM data following the accident (or the tractor for that matter, which was sold), moving for either a default judgment on the defendants’ negligence liability or an order by the Court establishing “the speed [at] which {the driver} was driving and the maneuvers he made in the light most favorable” to the plaintiffs. In response, the defendants argued that the failure to preserve the ECM data was “well-reasoned and justifiable” and even if seen as not reasonable, didn’t warrant the imposition of sanctions. In addition, the driver defendant argued that he had no duty to preserve the tractor’s ECM data at the time of the accident or had any custody or control over the tractor following the accident.

Judge’s Ruling

In considering the request for sanctions, Judge Ott found that “Big M—but not Shaffer—is guilty of spoliation. Big M’s corporate representative, Benton Elliott, confirmed that it is Big M’s normal practice to retrieve the ECM data from a tractor if they know a collision is severe, and he admitted that there was nothing preventing Big M from preserving the ECM data in this instance.”

However, Judge Ott indicated that he was “unwilling to impose either of the severe sanctions requested by the Barrys for a number of reasons”, including 1) he was “not convinced that Big M acted with the intent to deprive the Barrys of the use of the ECM data”, that 2) “it was Big M’s impression that the Barrys were at fault for the accident”, that 3) “the Barrys have not been prejudiced to such an extent that the severe sanctions they have requested would be warranted” and 4) “the Barrys have not shown that Shaffer bears any responsibility for the loss of the ECM data.”

As a result, Judge Ott ruled that “the Barrys’ request for spoliation sanctions will be denied to the extent they have asked the Court to enter a default judgment on the Defendants’ negligence liability or, alternatively, to enter an order judicially establishing the speed at which Shaffer was driving and the maneuvers he made prior to impact in the light most favorable to the Barrys. However, as an alternative sanction, the Court intends to tell the jury that the ECM data was not preserved and will allow the parties to present evidence and argument at trial regarding Big M’s failure to preserve the data.”

So, what do you think?  Is that a sufficient sanction for failing to preserve the truck and the ECM data?  Please share any comments you might have or if you’d like to know more about a particular topic.

Also, I’m excited to report that eDiscovery Daily has been nominated to participate in The Expert Institute’s Best Legal Blog Contest in the Legal Tech category!  Thanks to whoever nominated us!  If you enjoy our blog, you can vote for it and help it win a spot in their Best Legal Blogs Hall of Fame.  You can cast a vote for the blog here.  Thanks!

Case opinion link courtesy of eDiscovery Assistant.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Court Grants Lesser Sanctions Against Defendant for Various Discovery Issues: eDiscovery Case Law

In New Mexico Oncology v. Presbyterian Healthcare Servs. No. 1:12-cv-00526 MV/GBW (D.N.M. Aug. 16, 2017), New Mexico Magistrate Judge Gregory B. Wormuth, detailing numerous defendant discovery deficiencies alleged by the plaintiff, ruled that the “harsh sanctions of default judgment or an adverse jury instruction” requested by the plaintiff “are not warranted” and instead opted to require the defendant to pay plaintiff costs related to activities resulting from defendants’ over-designation of documents as privileged and recommended that the defendants be ordered to pay the plaintiff 75% of the costs associated with its Motion for Sanctions including all fees paid to expert witnesses to prepare reports and testify at the motion hearing.

Case Background

In this case, the plaintiff, detailing numerous alleged defendant discovery deficiencies, filed a Motion for Sanctions, requesting that the Court sanction the defendants by ordering default judgment against them, or, alternatively that the Court sanction the defendants by ordering an adverse jury instruction.  The allegations included:

  • Defendants failed to issue a proper litigation hold. The plaintiff alleged that the defendants’ original May 2012 litigation hold was inadequate because (1) it did not account for the “email jail,” a function which required that employees delete or archive emails when they run out of inbox space; (2) it covered only thirty-five employees and improperly excluded several key witnesses; (3) it allowed employees to determine which emails were irrelevant to the lawsuit and could be deleted; and (4) it did not apply to Defendants’ Live Exchange Server (a.k.a., the Transport Dumpster) and therefore did not preserve documents deleted by individual employees.
  • Defendants intentionally deleted discoverable emails received or sent by Dr. Dava Gerard. The two primary pillars of the plaintiff’s case for intentional deletion were: (1) the data found within the “free space” of the Gerard PST file (the PST file was 2 GB in size, but only 128 MB of materials were readable by native software when opened), and (2) data was found in the unallocated space on the hard drive on which the Gerard PST file was saved.
  • Defendants used privilege designations for the purpose of concealing documents and information. After the defendants produced their original privilege and redaction logs, the plaintiff objected to 2,831 of the 4,143 entries to which Defendants included in the logs.  The defendants conducted a re-review and produced 1,095 documents which were originally listed on the privilege log and 864 documents which were originally listed on the redaction log.  The plaintiff then objected to all 1,312 remaining listings on the privilege and redaction logs, stating that it no longer had confidence in Defendants’ privilege designations, leading to a second re-review, which led to an additional 861 documents produced.  The plaintiff then filed a Motion to Compel and for Sanctions against Defendants, which included a request “that the Court appoint a Special Master to conduct an independent in camera review” of the remaining records withheld and redacted – that review led to 197 additional documents ordered to be produced.

The plaintiff also complained that the defendants failed to produce usable billing and claims data in a timely manner, produced ESI for the wrong custodian named Mike West and did not properly collect hard copy documents in discovery.  As Frank Costanza would say at the Airing of Grievances during Festivus, “I got a lot of problems with you people”.

Judge’s Ruling

Judge Wormuth, reviewing the allegations in considerable detail, determined the following:

  • Improper litigation hold: Judge Wormuth acknowledged that “Without question, Plaintiff points out some imperfections with the litigation hold and its implementation” and he detailed several of those. However, he also explained that “Plaintiff failed to establish that these imperfections were a result of bad faith or that they resulted in the spoliation of evidence.”
  • Intentional deletion of emails: Noting that “the conclusion that data residing in the PST’s free space is only the result of deletion rests on the assumption that the export was conducted via the ‘client-side’ method, rather than the alternative ‘server-side’ method”, Judge Wormuth cited a lack of evidence that the collection specialist used a clean hard drive to conduct the collection and pointed to the presence of export logs to determine that the exports were conducted via the “server-side” method and concluded that “Plaintiff has not demonstrated by a preponderance of the evidence that Defendants intentionally deleted emails that should have been disclosed.”
  • Privilege designations: Judge Wormuth agreed with the Special Master’s report that the defendants “did not act in bad faith”. But, he did state “this does not mean that Defendants are free from blame. It is clear that Defendants over-designated documents as privileged, and that even their re-reviews were insufficient to fix their own errors. As a result, Plaintiff was required to repeatedly assert objections until the Special Master ultimately resolved the issue.”

As for the other issues, Judge Wormuth ruled that the “Plaintiff can demonstrate no prejudice resulting from any such delays” in receiving the billing and claims data, that the “collection of documents from the wrong Mike West was an inadvertent error and not done in bad faith” and that, because of the plaintiff’s failure to request that the Court allow additional depositions of the employees associated with the hard copy documents, “more severe sanctions are not warranted”.

Ultimately, Judge Wormuth ruled that the “harsh sanctions of default judgment or an adverse jury instruction” requested by the plaintiff “are not warranted” and instead opted to require the defendant to pay plaintiff costs related to activities resulting from defendants’ over-designation of documents as privileged and recommended that the defendants be ordered to pay the plaintiff 75% of the costs associated with its Motion for Sanctions including all fees paid to expert witnesses to prepare reports and testify at the motion hearing.

So, what do you think?  Was that an appropriate level of sanctions for the various discovery issues?  Please share any comments you might have or if you’d like to know more about a particular topic.

Case opinion link courtesy of eDiscovery Assistant.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Here’s a Chance to Learn What You Need to Do When a Case is First Filed: eDiscovery Best Practices

The first days after a complaint is filed are critical to managing the eDiscovery requirements of the case efficiently and cost-effectively. With a scheduling order required within 120 days of the complaint and a Rule 26(f) “meet and confer” conference required at least 21 days before that, there’s a lot to do and a short time to do it. Where do you begin?

On Wednesday, September 27 at noon CST (1:00pm EST, 10:00am PST), CloudNine will conduct the webcast Holy ****, The Case is Filed! What Do I Do Now? (yes, that’s the actual title). In this one-hour webcast, we’ll take a look at the various issues to consider and decisions to be made to help you “get your ducks in a row” and successfully prepare for the Rule 26(f) “meet and confer” conference within the first 100 days after the case is filed. Topics include:

  • What You Should Consider Doing before a Case is Even Filed
  • Scoping the Discovery Effort
  • Identifying Employees Likely to Have Potentially Responsive ESI
  • Mapping Data within the Organization
  • Timing and Execution of the Litigation Hold
  • Handling of Inaccessible Data
  • Guidelines for Interviewing Custodians
  • Managing ESI Collection and Chain of Custody
  • Search Considerations and Preparation
  • Handling and Clawback of Privileged and Confidential Materials
  • Determining Required Format(s) for Production
  • Timing of Discovery Deliverables and Phased Discovery
  • Identifying eDiscovery Liaison and 30(b)(6) Witnesses
  • Available Resources and Checklists

I’ll be presenting the webcast, along with Tom O’Connor, who is now a Special Consultant to CloudNine!  If you follow our blog, you’re undoubtedly familiar with Tom as a leading eDiscovery thought leader (who we’ve interviewed several times over the years) and I’m excited to have Tom as a participant in this webcast!  To register for it, click here.

So, what do you think?  When a case is filed, do you have your eDiscovery “ducks in a row”?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Plaintiff Sanctioned for Spoliation of Evidence in His Case Against Taylor Swift: eDiscovery Case Law

In Mueller v. Swift, No. 15-cv-1974-WJM-KLM (D. Colo. July 19, 2017), Colorado District Judge William J. Martinez ruled that “Plaintiff’s loss or destruction of the complete recording of the June 3, 2013 conversation [between the plaintiff and his supervisors] constitutes sanctionable spoliation of evidence”, but rejected the defendants’ request to make a finding of bad faith and to give the jury an adverse inference instruction, opting instead for permitting the defendants to cross-examine the plaintiff in front of the jury regarding the record of his spoliation of evidence.

Case Background

In this case against the defendants for tortious interference with the plaintiff’s employment contract and one defendant’s counterclaims for the torts of assault and battery over a well-publicized claim of inappropriate touching, the plaintiff met with his superiors at the radio station where he worked on June 3, 2013 to discuss the defendant’s claim of inappropriate touching. Unbeknownst to the supervisors at the time, the plaintiff made an audio recording of their conversation.  The following day, the plaintiff was terminated from his employment by one of the supervisors, who explained that one reason for the plaintiff’s termination was because he perceived Plaintiff had “changed his story that it couldn’t have occurred, then that it was incidental.”

At some point thereafter, well after having first contacted an attorney regarding potential legal action, the plaintiff edited the audio recording of the conversation, and then sent only “clips” of the entire audio file to his attorney.  According to his testimony, the plaintiff edited the audio file on his laptop computer, on which he also retained a full copy of the original audio file(s).  However, he claimed that he spilled coffee on the keyboard of his laptop and was given “a new machine” by the Apple Store and he didn’t retain the hard drive from the old laptop.  The plaintiff also kept an external hard drive “to store audio files and documents”, and the complete audio recording was saved on this drive, but he indicated that, at some point, it “stopped working.”  At his deposition, the plaintiff testified that he “may have kept” this hard drive, but that because it was “useless” he “[didn’t] know if I discarded it because it was junk”. As a result, the complete audio file was never produced and the defendants moved for a Court-imposed sanction for spoliation of evidence, and for the Court to give the jury an adverse inference instruction at trial, to direct the jury “that the entirety of the June 3, 2013 audio recording would have been unfavorable to Plaintiff.”

Judge’s Ruling

Judge Martinez ruled that the plaintiff had a duty to preserve the recording, that the recording was “relevant to numerous disputed facts and issues” in the case, that the defendants were prejudiced by the loss of evidence and that the degree of culpability warrants a sanction.  While declining to make a finding that the plaintiff acted in bad faith, Judge Martinez indicated that the “spoliation falls higher up on the ‘continuum of fault’” than mere negligence”, noting that it was “troubling” that the plaintiff also threw out his cell phone, months after the litigation was filed, noting “it may have been the device that he originally used to record the June 3, 2013 conversation”.

As a result, Judge Martinez concluded that “Plaintiff’s loss or destruction of the complete recording of the June 3, 2013 conversation constitutes sanctionable spoliation of evidence”, but, determining that the defendants’ request for an adverse inference instruction sanction “would be unduly harsh in the circumstances of this case”, deciding instead to permit the defendants to cross-examine the plaintiff in front of the jury regarding the record of his spoliation of evidence.

So, what do you think?  Was that an appropriate sanction given the lack of finding of bad faith?  Please share any comments you might have or if you’d like to know more about a particular topic.

Case opinion link courtesy of eDiscovery Assistant.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Defendant Not Sanctioned Despite Use of Evidence Wiping Software: eDiscovery Case Week

eDiscovery Case Week continues.  We’ll cover four cases this week (catching up on a couple from earlier this year) and we’ll cover our Wednesday webcast Key eDiscovery Case Law Review for First Half of 2017 (click here to sign up for that) as well.  Here’s the next case.  And, unlike the “Phelps vs. Shark” debacle, I promise nothing about this post was computer generated… :o)

In HCC Ins. Holdings, Inc. v. Flowers, No. 1:15-cv-3262-WSD (N.D. Ga., Jan. 30, 2017), Georgia District Judge William S. Duffey, Jr. denied the plaintiff’s motion for adverse inference sanctions despite evidence that the defendant had used evidence wiping software twice after being ordered to produce her personal computer, stating that the plaintiff “offers only bare speculation that any of its trade secrets or other data were actually transferred” to the defendant’s laptop.

Case Background

In this case, the defendant was accused of misappropriating trade secrets after she left her company and started a competitive company. The plaintiff claimed that when the defendant left the company, she took confidential files with her to benefit her new company and also claimed that, after receiving the lawsuit papers in this case, and after the Court ordered the defendant to produce her personal computer, she destroyed data on her personal laptop and also on a thumb drive that was plugged into her personal computer on September 20, 2015 (which was after she received a preservation notice and the complaint in the case).

The defendant’s husband, an experienced IT professional, claimed he inserted his personal thumb drive on September 20 to back-up data on the defendant’s personal laptop, but the thumb drive was corrupted and did not work, and that he therefore threw it away (the defendant’s own computer forensic expert claimed that it did work properly the second time, when it was plugged in for 38 seconds.

On September 19, 2015, and again three days later, the day after the Court ordered the defendant to produce her personal computer, the computer wiping program CCleaner was manually run on her personal laptop.  During that time, the program Defraggler (program that overwrites deleted files in unallocated space on a computer’s hard drive) was also run and so was a program called WinUndelete (which is used to recover deleted files).  The plaintiff claimed the defendant’s husband used WinUndelete to confirm that he had destroyed evidence, but he claimed he ran the program off of his work thumb drive to familiarize himself with it for future use for work purposes.  After running extensive searches over several weeks, a neutral examiner did not locate any of the plaintiff’s confidential information or trade secrets on any of the devices produced by the defendant.

Judge’s Ruling

In reviewing the results, Judge Duffey stated: “HCC’s Motion is based on a series of events it casts as suspicious, but HCC offers only bare speculation that any of its trade secrets or other data were actually transferred from HCC Life’s systems to Flowers’ personal laptop. A party seeking spoliation sanctions must prove that (1) the missing evidence existed at one time; (2) the defendant had a duty to preserve the evidence; and (3) the evidence was crucial to the plaintiff’s prima facie case… Here, after extensive discovery, including examinations by a neutral forensic examiner and the parties’ expert forensic examiners, depositions, and subpoenas of email and cloud-based storage companies, HCC does not provide any evidence to show that Flowers or her husband actually transferred any data from HCC Life to her personal devices or cloud storage media she controlled.”

As a result, Judge Duffey ruled as follows: “Though Flowers’ and her husband’s actions are troubling, and in breach of her duty to preserve, the Court finds spoliation sanctions are not warranted.”

So, what do you think?  Is this ruling troubling?  Or should the motioning party be required to show evidence of actual responsive ESI deleted?  Please share any comments you might have or if you’d like to know more about a particular topic.

Case opinion link courtesy of eDiscovery Assistant.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Court Denies Defendant’s Motion to Overrule Plaintiff’s Objections to Discovery Requests

Court Declines to Impose Sanctions for Failure to Preserve Web History: eDiscovery Case Law

In Eshelman v. Puma Biotechnology, Inc., No. 7:16-CV-18-D (E.D.N.C. June 7, 2017), North Carolina Magistrate Judge Robert B. Jones, Jr., among other rulings, denied the plaintiff’s motion for an order permitting a jury instruction in response to the defendant’s failure to preserve certain internet web browser and search histories, concluding that the plaintiff “is not entitled to a sanction pursuant to Rule 37(e)(1)” and that the plaintiff “is not entitled to an adverse jury instruction as a sanction pursuant to Rule 37(e)(2).”

Case Background

In this case involving alleged defamatory statements made by the defendant against the plaintiff in an investor presentation, two weeks after the complaint was filed in February 2016, the defendant issued an internal litigation hold notice related to the plaintiff’s claims in this case which defined documents to include electronically-stored information and advised employees to err on the side of preservation if there was a question as to whether material qualified as documents, but did not explicitly reference internet browser histories, internet search histories, or internet sites visited.  In May 2016, approximately 120 days after the publication of the investor presentation, counsel for the plaintiff sent a letter to the defendant’s counsel requesting that the defendant preserve, among other things, the “web browser histories” of individuals involved in the drafting of the January 7, 2016 presentation.  The plaintiff reiterated that request in its document requests in June 2016.

Counsel for the defendant responded that the defendant uses Google Chrome as an internet browser, which deletes web browser history after 90 days, and accordingly, the web browser history information sought in the discovery requests no longer existed and did not exist at the time of the May letter, leading to the motion filed by the plaintiff seeking “a jury instruction to mitigate the harm caused by the defendant’s failure to preserve electronically stored information.”

Judge’s Ruling

Judge Jones initially observed that “while the plaintiff states that he seeks a jury instruction to mitigate the harm caused by the defendant’s failure to preserve electronically stored information (“ESI”), the plaintiff does not define the particular instruction sought.”  Considering Rule 37(e)(1) and Rule 37(e)(2), Judge Jones determined the following:

Observing that “the plaintiff has not established one of the threshold elements of Rule 37(e)—namely, that the lost ESI ‘cannot be restored or replaced through additional discovery. . . .’”, Judge Jones stated that “other avenues of discovery are likely to reveal information about the searches performed in advance of the investor presentation. For example, the plaintiff could seek information about the internet searches performed by the individuals who prepared the investor presentation through deposition testimony.”  Judge Jones also stated that “the plaintiff has failed to make a sufficient showing of prejudice to support relief under Rule 37(e)(1). In order to impose a sanction under Rule 37(e)(1), the court must have some evidence regarding the particular nature of the missing ESI in order to evaluate the prejudice it is being requested to mitigate.”  As a result, Judge Jones determined that “the plaintiff is not entitled to a sanction pursuant to Rule 37(e)(1).”

Judge Jones also ruled that “the plaintiff has also failed to show that the defendant acted with the requisite intent to deprive him of the ESI in order to support the imposition of an adverse jury instruction under Rule 37(e)(2),” noting that “[a]t most, the circumstances indicate the ESI was lost due to the defendant’s negligence, but do not suggest the presence of intentional conduct. Negligence, however, will not support an award of sanctions under Rule 37(e)(2).”  As a result, Judge Jones determined that “the plaintiff is not entitled to an adverse jury instruction as a sanction pursuant to Rule 37(e)(2).”

So, what do you think?  Should internet histories be a standard form of ESI to be preserved in litigation?  Or does it depend on the case?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Court Denies Defendant’s Motion to Overrule Plaintiff’s Objections to Discovery Requests

Court Grants Motion for Terminating Sanctions Against Defendants for Intentional Spoliation: eDiscovery Case Law

In Omnigen Research et. al. v. Wang et. al., No. 16-00268 (D. Oregon, May 23, 2017), Oregon District Judge Michael J. McShane granted the plaintiffs’ Motion for Terminating Spoliation Sanctions and agreed to issue an Order of Default Judgment in favor of the plaintiffs (while dismissing the defendants’ counterclaims) due to the defendants’ intentional destruction of evidence on several occasions.

Case Background

In this case (for breach of contract, intentional interference with economic relations, misappropriation of trade secrets, copyright infringement, false advertising and unfair competition, and breach of fiduciary duty filed against a former employee of the plaintiff, Yongqiang Wang), the plaintiffs alleged that in 2012, while still employed by the plaintiff, he stole trade secrets and created two rival businesses, including the defendant company Bioshen.  The plaintiffs, concerned in part about the possible destruction of evidence early in the case, filed a Motion for Preliminary Injunction, which was granted in May 2016, to force the defendants to “immediately produce to Plaintiffs all electronic media in their custody, possession or control for purposes of verifying that they do not contain Plaintiff’s confidential and/or copyrighted material.”

Eleven days later, the plaintiffs filed a Motion for Order to Show Cause because Wang had left for China without producing his laptop as required by the Preliminary Injunction. A hearing on the issue was held and, in addition to other requirements, the defendants were ordered to “download all of the contents of the computer in China on a portable hard drive and have it mailed to defense counsel within 7 days, and deliver any computers or portable storage data to defense counsel by 5/27/2016.”

The plaintiffs were required to seek court intervention regarding discovery on multiple occasions because of the failure of the defense to adequately respond to their requests for production.  Ultimately, the plaintiffs filed their Motion for Terminating Spoliation Sanctions on 3/3/2017, with oral arguments heard on the motion on 4/18/2017.

Judge’s Ruling

Before detailing all of the instances where the defendants “intentionally” deleted or destroyed evidence, Judge McShane stated:

“As stated during oral arguments on 4/18/2017, the Court finds the destruction of evidence by the defendants was intentional. The plaintiffs’ Motion for Terminating Spoliation Sanctions describes in full detail the many ways the defendants intentionally hid or destroyed evidence in this case. In summary, Plaintiffs allege that the defendants made their desktop computer unavailable by “donating” it to Goodwill, that the defendants intentionally deleted thousands of documents from Wang’s personal Lenovo computer, that the defendants intentionally deleted and refused to produce relevant emails from multiple email accounts, and that the defendants intentionally destroyed metadata. These actions have deprived the Plaintiffs of evidence central to their case and undermined the Court’s ability to enter a judgment based on the evidence. For these reasons, default judgment and terminating sanctions for the spoliation of evidence is warranted FRCP 37(b)(2), Rule 37(e), and the Court’s inherent authority to sanction abusive litigation practices.”

As a result, Judge McShane granted the plaintiffs’ Motion for Terminating Spoliation Sanctions and agreed to issue an Order of Default Judgment in favor of the plaintiffs while dismissing the defendants’ counterclaims.

So, what do you think?  With the new Rule 37(e) (since December 2015), do you think it takes this level of intent to obtain significant sanctions?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Court Denies Defendant’s Motion to Overrule Plaintiff’s Objections to Discovery Requests

Court Grants Summary Judgment After Plaintiff’s Spoliation Motion Denied: eDiscovery Case Law

In Taylor v. Thrifty Payless, Inc., d/b/a Rite-Aid, No. 16-00474 (D. Oregon, May 12, 2017), Oregon District Judge Marco A. Hernandez granted the defendant’s motion for summary judgment after denying the plaintiff’s request for spoliation sanctions against the defendant for failing to preserve store videos that were taken on the day of her slip and fall in the defendant’s store.

Case Background

In this slip and fall case in a defendant store, the plaintiff sued the defendant after she slipped and fell in a large puddle, eventually claiming “significant pain” to her hand and wrist.  As a result, the plaintiff filed suit, alleging that the defendant “a) failed to make the premises reasonably safe; b) failed to take reasonable steps to promptly remove the puddle of liquid from the Rite-Aid store floor; c) failed to adequately warn Plaintiff by placing cones around the area of the liquid on the floor; and d) failed to properly secure the area, knowing that the puddle of liquid could pose additional risks to patrons of the store.”  After discovery, the defendant moved for summary judgment.

On the day of the spill, the store manager reviewed the security tapes from the time of the incident, and did so again a day or two later with the defendant’s Risk Management group, and found that the cameras did not cover the area of the spill.  As a result, the defendant did not keep the footage of that day’s events, adhering to its policy of deleting video footage every thirty-seven days.  The plaintiff argued that the defendant’s failure to preserve was the reason for her lack of evidence and asked the court to deny summary judgment as a sanction for the defendant’s destruction of the security video.  The defendant argued it had no obligation to preserve the video because the video did not show the spill itself and, therefore, would not have contained any relevant evidence.

Judge’s Ruling

In considering the facts associated with deletion of the video footage, Judge Hernandez stated: “Defendant did not destroy the videos in response to this litigation. Cases make clear that ‘in response to litigation’ means after a complaint has been filed, a discovery request has been made, a letter openly threatens litigations, or some other reason indicating that litigation is likely… Plaintiff herself points out that the surveillance footage is erased from Defendant’s hard drive every thirty-seven days…The erasure occurred when Defendant knew only that Plaintiff had fallen and hurt her wrist. There was no basis for Defendant to conclude that litigation was likely.”  As a result, Judge Hernandez concluded that “Sanctions for spoliation are inappropriate here.”

Therefore, in granting the defendant’s motion for summary judgment, Judge Hernandez stated: “Plaintiff’s arguments are not supported by direct evidence or logical inference. Instead, she relies on speculation and conjecture which is insufficient to create an issue of material fact precluding summary judgment.”

So, what do you think?  Do plaintiffs in “slip and fall” cases face an uphill battle in obtaining sanctions for deletion of video at the site of an accident?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Court Denies Defendant’s Motion to Overrule Plaintiff’s Objections to Discovery Requests

Court Says Rule 37(e) Doesn’t Apply When Recording Was Intentionally Deleted: eDiscovery Case Law

In Hsueh v. N.Y. State Dep’t of Fin. Services, No. 15 Civ. 3401 (PAC) (S.D.N.Y. Mar. 31, 2017), New York District Judge Paul A. Crotty relied upon inherent authority to impose sanctions and determined “that an adverse inference is the appropriate remedy” for the plaintiff’s deletion of a recorded conversation with an HR representative, agreeing with the defendants that “Rule 37(e) applies only to situations where ‘a party failed to take reasonable steps to preserve’ ESI; not to situations where, as here, a party intentionally deleted the recording.”

Case Background

In this case arising from claims of sexual harassment at work, the plaintiff, at an April 2016 deposition, initially stated that she did not think she had recorded any conversations with an HR representative (Allison Clavery) from the company about her allegations, but eventually explained that she thought she had recorded one meeting with Clavery in either December of 2015 or January of 2016, and that she deleted the recording in “[e]ither the course of 2016 or 2015” because “the voice recording itself. . . was not very clear, so [she] did not feel it was worth keeping.”  As a result, in June and early July 2016, the defendants filed a motion for spoliation sanctions.

On July 11, 2016 — the day the plaintiff’s opposition to the spoliation sanctions motion was due — plaintiff’s counsel submitted a letter to the Court advising that “I received an e-mail from my client at 10:16 p.m. last evening, which contained an audio recording attachment of a meeting between my client and Allison Clavery.”  Plaintiff’s counsel noted that “the e-mail indicated that the recording had been recovered with the help of Plaintiff’s husband” and that plaintiff’s counsel stated that he was “awaiting any further instructions with regard to Defendant DFS’s motion.”  As a result, discovery was reopened and the plaintiff and her husband were deposed.  Despite recovery of the recording, the defendants continued to pursue spoliation sanctions, as they had only received materials relating to the plaintiff’s mental health history “over the past few weeks, despite requesting them back in December 2015.”

The defendants stated that it was unclear as to whether Rule 37(e) applied here, arguing that the audio recording might not be ESI and also arguing that Rule 37(e) applies only to situations where “a party failed to take reasonable steps to preserve” ESI; not to situations where, as here, a party intentionally deleted the recording.  The plaintiff, on the other hand, argued that, since the recording was restored, no sanctions were warranted.

Judge’s Ruling

With regard to the defendant’s argument that the recording is not ESI, Judge Crotty stated “The Court disagrees. The recording was made using a digital recorder, and was saved in a digital format.”

However, with regard to the defendant’s argument that Rule 37(e) doesn’t apply when the party intentionally deletes the recording, Judge Crotty said “This makes sense. The Committee Notes to the 2015 Amendment to Rule 37 explain that Rule 37(e) is meant to address ‘the serious problems resulting from the continued exponential growth in the volume of’ ESI as well as ‘excessive effort and money’ that litigants have had to expend to avoid potential sanctions for failure to preserve ESI…These considerations are not applicable here. It was not because Hsueh had improper systems in place to prevent the loss of the recording that the recording no longer existed on her computer; it was because she took specific action to delete it. The Court therefore concludes that Rule 37(e) does not apply.”

As a result, Judge Crotty, determining that “the Court may rely on its inherent power to control litigation in imposing spoliation sanctions”, ruled “that an adverse inference is the appropriate remedy” for the plaintiff’s deletion of the recording and granted the defendants’ motion for spoliation sanctions.

So, what do you think?  Should Rule 37(e) have applied here?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Craig Ball Says That Failure to Preserve Mobile Devices in Litigation is the “M” Word: eDiscovery Best Practices

In the latest post in his excellent Ball in Your Court blog, Craig Ball has some strong words for attorneys who fail to advise clients to preserve ESI from mobile devices when under a preservation duty.

In the post titled A New Paradigm in Mobile Device Preservation, Craig discusses how prevalent the use of mobile devices have become in our society, noting that “[d]riving under the influence of phones has eclipsed driving under the influence of alcohol as the most frequent cause of motor vehicle collisions” and that “[w]alking into fixed objects while texting is reportedly the most common reason young people visit emergency rooms today”.

As someone who never goes anywhere without my iPhone and a parent of two pre-teen kids for whom we have to set limits on their devices (for fear that they will literally spend the entire day on them), I can certainly relate to our level of addiction to our mobile devices in today’s society.

Because of that change, Craig issues a very strong statement when it comes to an attorney’s duty to advise clients to preserve ESI from these devices now:

“Today, if you fail to advise clients to preserve relevant and unique mobile data when under a preservation duty, you’re committing malpractice.”

That’s the “M” word that I referred to in the title of this post and Craig says he doesn’t use it lightly.

Craig identifies the fact that data on phones and tablets is not just a copy of ESI on other sources anymore and the increasing ease to perform a backup of data on your mobile device as two paradigm shifts that impact the requirement for mobile device preservation.  Today, it’s unique data without an unusual burden required to preserve that data.

Our coverage yesterday of this case where the judge recommended dismissal of the case after the plaintiff erased and reset her iPhone – 6 hours before turning it over to her attorney to be sent for forensic examination (naturally, she claimed not to know what happened) illustrates what can happen when mobile devices aren’t preserved.  Sadly, I expect we will see more cases like this in the future.

So, what do you think?  Is failure to advise clients to preserve ESI from mobile devices malpractice?  As always, please share any comments you might have with us or let us know if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine. eDiscovery Daily is made available by CloudNine solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Daily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.