Motion for Sanctions – Page 34 – Electronic Discovery Law

Official Comm. Of Unsecured Creditors of Exeter Holdings Ltd v. Haltman, No. CV 13-5475(JS)(AKT), 2015 WL 5027899 (E.D.N.Y. Aug. 25, 2015); Official Comm. Of Unsecured Creditors of Exeter Holdings Ltd v. Haltman, No. CV 13-5475(JS)(AKT), 2016 WL 128154 (E.D.N.Y. Jan. 12, 2016)

Dec 01 2016

Key Insight: Addressing motion for sanctions for the loss of emails in third party custody (GoDaddy), Iron Mountain back ups, and miscellaneous computer files, the Magistrate Judge concluded: 1)that Exeter had a duty preserve reasoning that since 2009 it had been involved in other litigation involving the disclosure of its books, records and financial documents, and that Exeter therefore knew or should have known that the documents ?could be relevant to future litigation? and also found that even if the filing of the 2009 lawsuit (involving different parties) did not trigger the preservation obligation, receipt of a 2009 subpoena should have and that in any event, the duty to preserve arose no later than Exeter?s 2011 bankruptcy filing; 2)that Exeter?s loss of ESI was ?intentional and done in bad faith? absent evidence of any effort to ensure preservation or to contact the third-party providers to inform them of the duty; and 3) that as a result of the intentional loss, a presumption of relevance was warranted and therefore recommended a sanction of an permissive adverse inference at trial; upon Exeter?s objection, District Court adopted the sanctions recommendation entirely and indicated that ?[W]hen there has been intentional destruction of evidence by an officer of a closely held corporation, other officers of the closely held entity may be subject to sanctions, even if they did not have direct control of the evidence at issue.?

Nature of Case: Plaintiff claims that Defendants defrauded Exeter?s creditors by transferring funds from Exeter to themselves, certain trusts, and other entities.

Electronic Data Involved: Email in third-party custody, Iron Mountain backups, miscelaneous ESI

Virtual Studios, Inc. v. Stanton Carpet, Corp., No. 4:15-CV-0070, 2016 WL 5339601 (N.D. Ga. June 23, 2016)

Dec 01 2016

Key Insight: Where the court acknowledged that after a duty to preserve arose in 2009 Plaintiff ?did little, if anything, to prevent the loss of emails,? including failing to instruct employees to retain relevant documents and emails and failing to backup emails stored on employees individual hard drives, but where Defendant failed to establish bad faith or an intent to deprive, the court declined to impose an adverse inference or other serious sanctions pursuant to Rule 37(e)(2) but, upon finding that the loss of emails was prejudicial to Defendant (where the parties offered competing narratives regarding whether Defendant was informed regarding Plaintiff?s limitations on the use of its images), ordered that the defendant ?may introduce evidence concerning the loss of the e-mails and may make an argument to the jury concerning the effect of the loss of the e-mails?

Nature of Case: Copyright infringement

Electronic Data Involved: Emails

Prezio Health, Inc. v. John Schenk & Spectrum Surgical Instruments, Inc., No. 3:13 CV 1463 (WWE), 2016 WL 111406 (D. Conn. Jan. 11, 2016)

Dec 01 2016

Key Insight: Where individual Defendant informed his family that litigation related emails were to be preserved, but where at least three of eight ordered to be produced were lost, perhaps when Defendant?s wife transferred her emails to a new App, court found Defendant?s effort was ?grossly deficient? noting that defense counsel and Defendant had failed to impress upon the family the significance of the emails; addressing question of an appropriate sanction, Court cited Residential Funding Corp, 306 F.3d 99 (2d Cir. 2002), and ordered a ?permissive adverse inference? and payment of Plaintiff?s attorney?s fees and costs incurred in pursuing the issue

Electronic Data Involved: Emails from account used by multiple family members

Magdaluyo v. MGM Grand Hotel, LLC, no. 2:14-cv-01806-RFB-GWF, 2016 WL 614397 (D. Nev. Feb. 16, 2016)

Dec 01 2016

Key Insight: Where Plaintiff specifically requested preservation of certain video that was not preserved, court concluded that Defendant ?simply ignored? the request and imposed an adverse inference that the video would have been favorable to Plaintiff; for Defendant?s failure to preserve surveillance video of alleged harassment for which there was no specific request to preserve, court reasoned that Defendant had a duty to investigate the allegation and preserve any video that existed of the incident and concluded that the jurors would be instructed that ?Defendant had a duty to preserve the video if it existed and that they may, but are not required to, infer that the video recording would have been favorable to the Plaintiff?

Nature of Case: Employment litigation (discrimination, harassment, etc.)

Electronic Data Involved: Video surveillance footage

Glob. Materials Techs., Inc. v. Dazheng Metal Fibre Co. Ltd., No. 12 CV 1851, 2016 WL 4765689 (N.D. Ill. Sept. 13, 2016)

Dec 01 2016

Key Insight: Where the court concluded that Defendants deliberately failed to preserve evidence ?in order to prevent [Plaintiff] from obtaining the evidence and using it against defendants in litigation? (e.g., by liquidating computers and delaying accessing an email account until emails were deleted by the provider) and lied to the court and to the plaintiff (?Defendants were not merely dilatory or misleading in their litigation tactics; they were affirmatively deceitful?), the court reasoned that while an adverse inference or prohibition on introducing certain evidence may ?level the playing field? it would not sufficiently punish Defendants for their dishonesty, and therefore imposed default judgment as to liability (damages remained to be proven); court?s analysis noted that under Fed. R. Civ. P. 37(e)(2) a specific finding of prejudice is not required where the finding of intent supports the inference that the missing information was unfavorable to the party who destroyed it

Nature of Case: Trade secrets

Electronic Data Involved: Computers, emails

Core Labs. LP v. Spectrum Tracer Servs., LLC, No. CIV-11-1157-M, 2016 WL 879324 (W.D. Okla. Mar. 7, 2016)

Dec 01 2016

Key Insight: Where emails were lost in Defendant?s transition from one service provider to another, despite efforts to preserve, the court found that Plaintiff was prejudiced by the loss and found that a presumptive adverse inference was appropriate but declined to impose sanctions for Defendant?s deletion of ?personal? files prior to production of a hard drive for forensic analysis where the court found such deletion ?reasonable? and also declined to impose sanctions for the wiping of an at-issue computer where the court found no bad faith in light of the alleged ?computer problems? that the wipe was intended to address and Defendant?s claim that ?anything that needed to be kept? was exported first; notably court?s analysis included specific recognition of newly amended Rule 37(e) but also recognized a common law standard requiring only prejudice to impose a spoliation sanction

Electronic Data Involved: Emails, computer files, contents of hard drive

Accurso v. Infra-Red Servs., Inc., —F. Supp. 3d.—, 2016 WL 930686 (E.D. Pa. Mar. 11, 2016)

Dec 01 2016

Key Insight: Court denied motion for a negative inference for Plaintiff?s alleged deletion of emails evidencing Plaintiff?s intention of taking business from Defendants where Defendants provided no basis for the court to conclude: 1) that there was ?actual suppression or destruction of evidence, let alone that [Plaintiff] was responsible,? 2) that the evidence was not obtainable from other sources, or 3) that Defendant acted with the requisite intent to deprive under Fed. R. Civ. P. 37(e)

Nature of Case: Claims and counterclaims include: violations of Employee Polygraph Protection Act, breach of contract, intentional interference with contract, fraud, misappropriation of trade secrets

Electronic Data Involved: Emails

Thurmond v Bowman, No. 14-CV-6465W, 2016 WL 1295957 (W.D.N.Y. Mar. 31, 2016)

Dec 01 2016

Key Insight: Where Defendants sought spoliation sanctions for Plaintiff?s alleged deletion of social media postings that Defense counsel claimed had disappeared from the relevant account, the evidence indicated that the majority of those posts were merely hidden as the result of Plaintiff?s modification of her security settings and the court noted that the three posts that were missing ?did not seem relevant? and concluded that spoliation sanctions were not warranted; court?s analysis included disagreement with the argument that ?the entirety of a plaintiff?s social media account is per se relevant to any claim for emotional distress damages,? and concluded that the contention that sanctions were warranted for the deletion of any Facebook post swept ?far too broadly?

Nature of Case: Housing discrimination

Electronic Data Involved: facebook (social media / social network)

Whitesell Corp. v. Electrolux Home Prods., Inc., NO. CV 103-50, 2016 WL 1317673 (S.D. Ga. Mar. 31, 2016)

Dec 01 2016

Key Insight: Where promised emails were not produced but Defendant ultimately produced all documents relevant to the alleged spoliation, including ?preservation communications to document custodians, a list of custodians who were searched, the search terms used to conduct the search, and project documents and materials relating to such searches,? and also submitted a representative for an extensive Rule 30(b)(6) deposition, the court found Plaintiff?s request to compel production of ?every privileged document described as concerning data collection?[wa]s overly broad, unduly burdensome and ha[d] not been shown to relate to the issue at the forefront of this entire exercise?the missing Leon emails? despite acknowledging that ?otherwise privileged documents may be discoverable upon a preliminary showing of spoliation.?

Electronic Data Involved: Information related to preservation efforts, etc. where Plainitff alleged spoliation by Defendant and sought to compel production of privileged information

O?Berry v. Turner, Nos. 7-15-CV-00064-HL, 7:15:CV-00075-HL, 2016 WL 1700403 (M.D. Ga. Apr. 27, 2016)

Dec 01 2016

Key Insight: Where custodian printed single paper copy of relevant driver?s log and PeopleNet data to be maintained in the usual course of business, did nothing more upon receipt of a request for preservation and ultimately misplaced the envelope in which the information was maintained despite claiming to have done ?everything in his power to preserve evidence,? the court found that Defendant filed to take reasonable steps to preserve the data and acted with the intent to deprive Plaintiffs of the information in litigation, reasoning that it was ?simply irresponsible? to print a single paper copy for preservation and noting Defendant?s lack of a document preservation policy and the failure of counsel to contact the at-issue custodian for approximately two and one half years following receipt of the request to preserve, among other things: ?All of these facts, when considered together, lead the Court to conclude that the loss of the at-issue ESI was beyond the result of mere negligence. Such irresponsible and shiftless behavior can only lead to one conclusion?that ADM and Archer Daniel Midlands Company acted with the intent to deprive ??

Nature of Case: Automobile accident

Electronic Data Involved: Driver’s log, PeopleNet data

Tag:Motion for Sanctions