DR Distributors v. 21 Century Smoking, Inc. (N.D. Ill. 2021)
Key Insight: The court granted plaintiff’s motion for sanctions but declined to find “intent to deprive” under Rule 37(e), instead applying Rule 26(g) for failing “to make a reasonable investigation to ensure that [defendant] provided all available responsive information and documents.” The court issued sanctions and curative measures under Rules 37(a), 37(b), 37(c) and 37(e)(1). This 256-page sanctions opinion arises from ESI issues beginning at the outset of protracted litigation involving infringement claims over similar trademarks for e-cigarettes. Defendants and their counsel were sanctioned for multiple failures to preserve and collect ESI, including: failure to preserve messages from web-based email and chat applications; failure to turn off auto-delete functions on messages; defense counsel’s failure to follow-up with written hold instructions to preserve relevant ESI and take steps to collect messages from web-based applications; defense counsel’s failure to perform custodial interviews to identify likely sources of ESI; defense counsel’s failure to understand that relevant emails may be found in both corporate and personal email and mistakenly believed that data within the web applications would be saved to corporate hard drives; failure to disclose the existence of relevant ESI; defense counsel offered false testimony about the existence of ESI; and defense counsel’s failure to supervise defendants in self-collected ESI.
Nature of Case: Trademark infringement (Lanham Act)
Electronic Data Involved: Email, Instant messages