Court Rejects Refusal to Issue Litigation Hold Before 26(f) Conference, Orders Litigation Hold on All Evidence Reasonably Related to Pending Litigation

Haraburda v. Arcelor Mittal USA, Inc., No. 2:11 cv 93, 2011 WL 2600756 (N.D. Ind. June 28, 2011)

In this case, plaintiff came to believe, based on defendant’s comments and refusal to issue a litigation hold, that relevant evidence would be destroyed.  Accordingly, plaintiff moved for an Order to Preserve Evidence.  Following consideration of the relevant factors and upon rejecting defendant’s arguments that plaintiff’s motion was improper prior to the parties’ Rule 26(f) conference, the court granted the motion and ordered defendant to implement a litigation hold on information that may reasonably be related to the pending litigation.

After filing her employment discrimination complaint, plaintiff became alarmed that relevant evidence could be lost when, in response to her inquiry about emails that were deleted without her consent during the EEOC investigation, defendant responded that “files stored on company computers are company property and can be assessed and/or deleted as the company views appropriate.”  Similarly, upon plaintiff’s request for assurance that potentially relevant evidence would be preserved (approximately one month after filing her complaint), defendant responded that “it refused to implement a litigation hold or other process to preserve evidence until after the Rule 26(f) conference” and explained that plaintiff’s request was “premature.”  Accordingly, plaintiff moved for an Order to Preserve Evidence.

Taking up the motion, the court established that the duty to preserve arises when “[a party] knows, or should have known, that litigation was imminent” and that upon the trigger of such a duty, “the party should implement a plan to find and preserve relevant evidence.”  “In fact,” the court went on, “a large corporation only can discharge its duty by: 1) creating a ‘comprehensive’ document retention policy that will ensure that all relevant documents are retained, … and 2) disseminating that policy to its employees.”  The court went on to establish the relevant law regarding preservation orders and the relevant factors to be considered before ordering one, including whether plaintiff could demonstrate that necessary evidence would be destroyed absent an order, whether plaintiff would suffer irreparable harm absent an order, and the burden imposed on the parties by granting a preservation order.  The court also rejected defendant’s assertion that such an order was premature prior to the parties’ Rule 26(f) conference.

Citing defendant’s statements regarding preservation, the absence of any evidence that defendant had taken steps to preserve evidence, the potential difficulty for plaintiff if relevant evidence was not preserved, and the fact that an order of preservation would not increase the burden of defendant’s preexisting duty to preserve, the court granted plaintiff’s motion and ordered defendant to “place a litigation hold on any and all documents and information that may reasonably be related to the pending litigation.”