ILWU-PMA Welfare Plan Bd. of Trs. v. Connecticut Gen. Life. Ins. Co., No. C 15-02965 WHA, 2017 WL 345988 (N.D. Cal. Jan. 24, 2017)

In this case, ESI was lost when Defendant’s parent company sold another of its companies—on whose servers Defendant’s ESI was inexplicably stored—resulting in the transfer of that company’s servers and the ESI thereon to the third-party buyer. Concluding that Defendant failed to take reasonable steps to preserve the at-issue data, the court rejected Defendant’s argument that clauses in the sale agreement providing for “reasonable access to business information” including for “litigation purposes” and requiring the parties to retain information until the sixth anniversary of the agreement and not to destroy such information without notifying the other party were sufficient, particularly where despite such clauses, the information was not, in fact, available.  While the court concluded that additional information was required to proceed with a full Rule 37(e) analysis, it reopened discovery and ordered monetary sanctions to address the prejudice already established.

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Harleysville Ins. Co. v. Holding Funeral Home, Inc., No. 1:15cv00057 (W.D. Va. Feb. 9, 2017)

In this case, the court found that the placement of privileged information on a file share site and dissemination of the hyperlink to access that information without additional protections (e.g, password protection) constituted a failure to take reasonable steps to protect the information and that the attorney-client privilege and work-product protections were waived.  Notably, however, because defense counsel accessed the information but failed to notify Plaintiff’s counsel of the possible production of privileged materials, they were ordered to pay Plaintiff’s fees and costs in bringing the motion to disqualify them, which was denied.

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