Court Orders Adverse Inference for Spoliation of Data on Handheld Devices

Southeastern Mechanical Services, Inc. v. Brody, 2009 WL 2883057 (M.D. Fla. Aug. 31, 2009)

Plaintiff Southeastern Mechanical Services, Inc. (“SMS”) moved for spoliation sanctions alleging that defendants, including individual defendants Smith, Sherouse and Brody, spoliated data by deleting it from their BlackBerries and laptops.  Defendants denied the allegations and argued that no evidence was destroyed because all of the data on the individual defendants’ laptops and BlackBerries was stored on servers.  Further, defendants argued that hard copies of the relevant emails were produced to SMS and it was therefore irrelevant whether any information was deleted.  The allegations regarding the laptops were eventually resolved by corporate defendant Thermal Engineering Construction Services, Inc.’s, (“TEI”), explanation that the laptops were configured so that the individual defendants’ emails would reside on the server.  As to the BlackBerries, however, the court found the individual defendants had deleted the data in bad faith and ordered an adverse inference to be provided to the jury at trial.

The timing of certain activities is relevant to the analysis.  In furtherance of their employment with corporate defendant TEI, defendants Smith and Sherouse purchased BlackBerries no later than May 29, 2008.  Defendant Brody used his personal BlackBerry during the course of his employment.  The BlackBerries were synchronized to TEI’s servers on June 3 and 4, 2008.  On June 10th, four days after receiving SMS’s demand letter alleging defendants’ unauthorized access to SMS’s confidential information and trade secrets, defendants’ emails were copied and preserved.  The individual defendants returned their “computer devices” and BlackBerries on June 16 and 17, 2008, four days after being asked to do so (pursuant to a Temporary Restraining Order issued by the court), and defendants email accounts were subsequently locked and frozen, preventing defendants’ access.

Thereafter, the BlackBerries were provided to plaintiff’s and defendants’ forensic experts.  Neither found any data on the BlackBerries, despite evidence that the devices had been used for more than making phone calls.  Specifically, plaintiff’s expert determined the devices “contained no data, including e-mails, text messages, calendar items, telephone records, contacts, attachments, or applications.”  TEI’s expert also determined that each of the devices contained a Subscriber Identity Module (“SIM”), a card which contains information about a phones service and can also contain information about text messages and address contacts.  Limited, if any, information was discovered on each card.

Both experts proffered possible explanations for the absence of data, including accidental deletion by the consecutive mis-entry of the device’s password and purposeful deletion either by the user or remotely from the relevant server.  Defendants’ expert also opined that plaintiff’s expert may have inadvertently deleted the data while conducting his examination, a suggestion quickly dismissed by the court.

Under Florida law (relied upon in the absence of guidelines in the 11th circuit), spoliation is established when it is proven that:  “1) the evidence existed at one time, 2) the alleged spoliator had a duty to preserve the evidence, and 3) the evidence was crucial to the movant’s prima facie case or defense.”

Defendants conceded the existence of the data and their duty to preserve.  Thus, the questions before the court were:  1) whether defendants destroyed relevant data, and 2) whether they acted in bad faith when doing so.

The court found that “the circumstances surrounding the destruction of data from Individual BlackBerries indicate bad faith” and noted that three of the four explanations proffered by the experts for the lack of data were attributable only to “deliberate and intentional actions.”  In so finding, the court reasoned that the lack of any emails, calendar entries, text messages or telephone records was “improbable” and “suspicious” particularly in light of defendants’ frequent use of the devices.

Regarding defendants’ assertions that any emails deleted from the BlackBerries were stored on the company’s server, the court noted the six or seven day delay between the activation of the BlackBerries and their synchronization to the server.  Moreover, the hard copies previously produced by defendants revealed that the individual defendants used their personal accounts to communicate with TEI and others and that those emails would not be stored on the company’s server.  Nor, noted the court, would the server store text messages, calendar items, or call logs.  In footnote, the court explained its decision to hold the individual defendants responsible:

Because spoliation is an act of concealment and deception, it can be difficult to determine all of the facts related to the destruction of evidence, including the identity of the spoliator.  However, their possession of the devices, coupled with the delay in turning them over to TEI after receipt of service of the Temporary Restraining Order, gave the Individual Defendants the opportunity to erase data.  The court finds that Individual Defendants were responsible for the intentional wiping of the BlackBerries.  The record is insufficient to demonstrate that either Corporate Defendants or BPI directed or condoned Individual Defendants’ conduct.

Declining to impose the requested sanction of default judgment, the court found an adverse inference instruction to be the “most appropriate” sanction, and entered an order accordingly.