Spoliation – Electronic Discovery Law

ESI Protocols: Courts Hold Parties to Account for Failing to Comply with the Protocols They Negotiated

May 19 2023

To resolve electronic discovery issues early in legal proceedings, parties often negotiate ESI protocols that define the required formats of production, outline the scope of record preservation required for the matter, and address key issues regarding privilege, confidentiality, and other key discovery considerations. But what happens when parties establish requirements in their ESI protocols that they later cannot fulfill? Three recent case opinions reflect how courts can react negatively to such situations.

New Opinion by Washington Court of Appeals Identifies Limits on When Sanctions for Spoliation May Be Applied Under Washington Case Law

Apr 07 2023

Courts throughout the United States have different perspectives on the actions that constitute spoliation of evidence and the situations in which these actions should be sanctioned. Furthermore, as courts examine and re-examine these concepts over time, their perspectives shift. Therefore, attorneys, e-discovery practitioners, and parties in litigation must keep in mind the distinctions among different jurisdictions’ definitions of spoliation and their standards for when, and what types, of sanctions should be applied in light of such spoliation.

In its recent decision Seattle Tunnel Partners v. Great Lakes Reinsurance (UK) PLC, __ P.3d __ (Wash. Ct. App. Mar. 27, 2023), the Washington Court of Appeals, Division 1, discusses the evolution of Washington case law on spoliation of evidence and provides clarity around the circumstances that would justify the imposition of spoliation sanctions in this jurisdiction. Interestingly, the limits identified in this opinion regarding when spoliation sanctions are available differ from those in place in the federal courts and the courts of other states.

iMessages Are No Longer Immutable: The Ability to Edit and Unsend iMessages Provided by Apple iOS 16 Spurs New E-Discovery Questions

Sep 23 2022

On September 16th, Apple released iOS 16, which now allows users to edit or unsend iMessages. A sender can edit an iMessage up to five times within fifteen minutes after the message is sent. A sender can also unsend an iMessage within two minutes after the message is sent. Recipients of such messages receive an alert that the iMessage was unsent or edited, but do not see the specific changes.

Europe v. Equinox Holdings, Inc. (S.D.N.Y. 2022)

Mar 21 2022

Key Insight: Plaintiff brought a motion for sanctions alleging defendants failed to preserve a key piece of evidence (the September 2019 managers’ schedule from the month when she was terminated) in her employment discrimination suit. The court concluded that defendants should have taken steps to preserve the schedule in December 2019 when plaintiff notified defendants that she intended to initiate litigation, and they failed to do so. The court noted that the harshest sanction of adverse inference was not appropriate because it did not appear by clear and convincing evidence that the failure to preserve the evidence was done in order to gain an advantage in the litigation. The court ordered that plaintiff could present to the jury that the September 2019 schedule was lost and defendants could not compare her lateness to other employees in September 2019 or argue that her co-workers’ lateness in September 2019 was less than hers.

Nature of Case: Employment Discrimination

Electronic Data Involved: Business Documents

Case Summary

MasterObjects, Inc. v. Amazon.com, Inc. (N.D. Cal. 2022)

Mar 13 2022

Key Insight: Defendant filed a motion for sanctions based on violation of a prior discovery order and sought spoliation sanctions. The Magistrate Judge issued a report on the spoliation issue. Plaintiff’s law firm was attacked by hackers, which rendered files and mailboxes inaccessible without a recovery key set by the attackers. Both the FBI and the firm’s insurer advised the firm not to pay the hackers a ransom. The firm attempted to restore the data on its servers with some success but everything prior to the final months of 2016 has been lost. There were some printed copies of the archival copies of digital records but plaintiff’s counsel maintained it did not have a duty to keep a duplicate paper file of its digital records. The court noted that there was no evidence of any physical document (other than a copy of an electronically stored document) that was destroyed, and the spoliation doctrine does not require a party to maintain identical copies of documents. The court noted the data is not “lost” and exists on the hard drives and although access has been blocked, it can be accessed if a key is provided or a technological work-around is discovered. The court concluded there is no evidence the loss occurred because plaintiff’s firm failed to take reasonable steps to preserve it. Finally, the court found defendant could not establish prejudice and that there was an intent to deprive defendant of the evidence. It refused to apply a new kind of spoliation argument that plaintiff’s counsel’s firm “lost” its data because it refused to pay the ransom, finding “there is no logic or beneficial public policy in compelling a crime victim to pay ransom to a criminal in order to avoid being labeled a spoliator.”

Nature of Case: Intellectual Property

Electronic Data Involved: ESI

Case Summary

Hamilton v. Oswego Community Unit School District 308 (N.D. Ill. 2022)

Feb 25 2022

Key Insight: Plaintiffs sought a motion for sanctions based on spoliation of evidence based on defendants’ failure to preserve a photograph of their child’s bruise that was taken by the school nurse that led to a call to the DCFS hotline. The court found that defendants did not have a duty to preserve the photograph because it was not reasonably foreseeable the instant litigation would be forthcoming. At the time the nurse deleted the photo there was no indication that plaintiffs were contemplating litigation against the school for anything related to the nurse’s visit or the report to DCFS. As such, there was no duty to preserve the photo. Even if there was a duty to preserve the photo, the court found that plaintiffs were not prejudiced by its deletion.

Nature of Case: Civil Rights

Electronic Data Involved: ESI, Photographs

Case Summary

Emerson Creek Pottery v. Emerson Creek Events (W.D. Va. 2022)

Feb 18 2022

Key Insight: Plaintiff moved for spoliation sanctions against defendants relying on (1) an inadvertently disclosed email between defendant and his counsel discussing the preservation of emails, and (2) defendants did not produce a “mirror image” of the emails produced by third parties. Plaintiff contended the content of the email between defendant and his counsel is evidence that defendant failed to preserve ESI and defendant countered that it was part of a longer conversation between defendant and defense counsel about how defendants temporarily lost access to some of their emails during a server migration but later recovered them. The court denied plaintiff’s motion, finding that plaintiff failed to provide any evidence that defendants lost ESI and there was nothing to suggest that there were any additional emails that plaintiff had not received from defendants or third parties. If the court were to consider a remedy, the remedy requested by plaintiff was “draconian” and nearly the entirety of what defendants were expected to argue at trial, and the court would have to tailor a remedy to the particular discovery violation in question.

Nature of Case: Intellectual Property

Electronic Data Involved: Email

Case Summary

Gunter v. Alutiiq Advanced Security Solutions, LLC (D. Md. 2021)

Dec 28 2021

Key Insight: Defendant alleged that Plaintiff altered the wording of text messages and fabricated a series of text messages. Plaintiff also failed to produce relevant text message and falsely testified that such messages did not exists which was proved by a later forensic review. The Court had serious doubts regarding the text messages at issue. Plaintiff has no explanation for why his cellphone contains some text messages but not others. For these reasons, the Court ruled the text messages could not be used as evidence and the cost of the forensic review of the cell phone would be shifted to Plaintiff. However, the case would not be dismissed as there was not the “clear evidence necessary to conclude that Plaintiff fabricated the text messages.”

Nature of Case: Employment Discrimination

Electronic Data Involved: Text Messages

Case Summary

America West Bank Members v. State of Utah (D. Utah 2021)

Nov 10 2021

Key Insight: Plaintiff filed a motion to compel after learning through the discovery process that defendants purged or lost emails and documents. Plaintiff sought “discovery on discovery” to discern the identities of individuals whose emails would have been responsive if those emails were still available, the identification of documents or categories of documents no longer available, and an explanation as to why other responsive documents were not produced. The court granted plaintiff’s request but found it “strictly limited to the purged former employee email accounts.” No additional depositions were permitted and plaintiff’s fourteen interrogatories on this topic were “neither reasonable nor proportional” to the limited nature of the discovery needed.

Nature of Case: Civil rights

Electronic Data Involved: Email and documents

Case Summary

FTC v. Noland (D. Ariz. Aug. 30, 2021)

Aug 30 2021

Key Insight: The day after learning about the FTC’s investigation, defendant Noland instructed his team to use encrypted communications platforms, Signal and ProtonMail, turn on the “auto-delete” function, and to stop using their previous work-related messaging platforms. During depositions, Noland and others failed to disclose the use of encrypted communications platforms and deleted the encrypted messaging apps from the phones so that no communications could be retrieved. The court granted the FTC’s request for an adverse inference based on defendants’ intentional spoliation of evidence under FRCP 37(e)(2), finding the most decisive factor in its analysis was the timing of installation of the apps – just one day after Noland learned the FTC was investigating him. There was a coordinated effort among Noland and his leadership team to deprive the FTC of the use of the encrypted messages in the litigation – by installing the app, using the “auto-delete” function, failing to disclose the use of the app, and deleting the app the day before the phones were to be examined – resulting in an “outrageous maneuver that raises a strong inference of bad faith.”

Nature of Case: FTC, Pyramid schemes

Electronic Data Involved: Encrypted messaging platforms

Case Summary

Tag:Spoliation