Integrated Communications & Technologies v. Hewlett-Packard Financial Services Company (D. Mass. August 13, 2020) shows that under FRCP 37(e), the court is given strict guidelines when to enforce e-discovery sanctions. In this case, the court decided not to follow FRCP 37(e) and cite case law before FRCP 37(e) was enacted, leaving ambiguity of what certain e-discovery sanctions apply.
In this breach of contract case, the defendant sought e-discovery spoliation sanctions against the plaintiffs for the “alleged failure to preserve—and their alleged deliberate or reckless spoliation of—electronically stored information.”
Data that was deleted included:
- work email accounts
- computers with potentially relevant data that were sold, and
- email, for which a migration was conducted without first preserving relevant data from a key custodian in the case
Based on a long lineage of facts leading up to this dispute, the defendants argue that the plaintiffs anticipated litigation in 2013 because the plaintiff claimed work product then, well before when the plaintiffs conceded in testimony “that he anticipated litigation by late spring/early summer 2014.
The plaintiffs argued that they “continued to pursue non-litigious resolutions throughout 2013 and 2014, and that the prospect of litigation was therefore neither desired nor likely at that time” and contend that lost evidence was “of marginal value.
- Spoliation Occurred. The court ruled that “discoverable ESI existed at the time the duties to preserve the evidence arose, that defendant’s efforts to preserve the ESI were deficient, that defendant took affirmative and intentional steps to destroy relevant evidence that it knew or should have known had not been preserved, and that the evidence is now irretrievably lost. Thus, plaintiffs have shown that spoliation occurred.”
- Duty to Preserve.
The defendant argued that the duty to preserve hadn’t triggered when the defendant destroyed “email accounts and work-related calendars” because the duty to preserve “arose over time.” The court found this argument “extraordinary” and unfounded.
- No Default Judgment. Based on a large amount of data available to the plaintiffs’ to make their case (e.g. “seven to eleven months of pre-filing emails and calendars”), the ability for the court to mitigate damages caused by the spoliation weighed heavily in the court not granting the plaintiffs’ default judgment motion.Motion for Additional Discovery Rejected.
Expert Opinion from Mike Hamilton, J.D. Director of Marketing, Exterro
Reasonableness is key when defining a defensible e-discovery process. To protect against spoliation sanctions you need to create a process that clearly identifies when the litigation was reasonably anticipated, distribute a legal hold to key custodians and ensure data that is relevant to litigation is preserved and cannot be deleted. With an unclear spoliation standard, which was re-confirmed in this case ruling, legal teams must take this as a warning sign that defensibility takes a proactive approach.
Case Law Tip:
Download this guide to understand the rules and requirements for e-discovery practices under the FRCP.