2012 eDiscovery Year in Review: eDiscovery Case Law, Part 4
January 18, 2013
As we noted the past three days, eDiscoveryDaily published 98 posts related to eDiscovery case decisions and activities over the past year, covering 62 unique cases! Yesterday, we looked back at cases related to admissibility and the duty to preserve and produce electronically stored information (ESI). Today, let’s take a look back at cases related to sanctions and spoliation.
We grouped those cases into common subject themes and have reviewed them over the past few posts, ending today. Perhaps you missed some of these? Now is your chance to catch up!
SPOLIATION / SANCTIONS
All hail the returning champion! I’ll bet that you won’t be surprised that, once again, the topic with the largest number of case law decisions related to eDiscovery are those related to sanctions and spoliation issues. Of the 62 cases we covered this past year, almost a third of them (20 total cases) related to sanctions and spoliation issues. We found them in a variety of sources, even The Hollywood Reporter! Here they are. And, as you’ll see by the first case (and a few others), sanctions requested are not always granted – at least not yet.
Sanctions for Violating Motion to Compel Production? Not Yet. In Fidelity National Title Insurance Co. v. Captiva Lake Investments, LLC, where a party’s “conduct [did not] rise[ ] to the level of a willful violation of the order compelling production” because it was continually working toward the proper production of documents requested by its adversary, a court concluded that the adversary’s motion for sanctions was premature.
“Rap Weasel” Forced to Honor $1 Million Reward Offered via YouTube. It isn’t every day that eDiscoveryDaily has reason to reference The Hollywood Reporter in a story about eDiscovery case law, but even celebrities have eDiscovery preservation obligations during litigation. In Augstein v. Leslie, New York District Judge Harold Baer imposed an adverse inference sanction against hip hop and R&B artist Ryan Leslie for “negligent destruction” of a hard drive returned to him by the plaintiff after a $1 million reward was offered via YouTube. On November 28, a jury ordered him to pay the $1 million reward to the plaintiff.
Plaintiff Hammered with Case Dismissal for “Egregious” Discovery Violations. Apparently, destroying your first computer with a sledgehammer and using Evidence Eliminator and CCleaner on your second computer (when you have a duty to preserve both) are not considered to be best practices for preservation. Who knew? ;-)
Rambus’ “Shred Days” Result in Sanctions Yet Again. In Hynix Semiconductor Inc. v. Rambus, Inc., California District Judge Ronald Whyte used his discretion to fashion an appropriate fact-specific sanctions award after it found a party willfully destroyed evidence despite reasonably foreseeable litigation, it destroyed such evidence in bad faith, and the opposing party suffered prejudice.
Defendant Ordered to Retain Outside Vendor, Monetary Sanction Awarded. In Carrillo v. Schneider Logistics, Inc., California Magistrate Judge David Bristow ordered the defendant to “retain, at its expense, an outside vendor, to be jointly selected by the parties, to collect electronically stored information and email correspondence”. The defendant was ordered to produce all surveillance videotapes responsive to plaintiffs' discovery requests and monetary sanctions were awarded for plaintiff’s attorney fees and costs incurred as a result of the defendant’s discovery violations.
Government Document Productions Can Be Like Water Torture. In Botell v. United States, Magistrate Judge Gregory Hollows noted that the US Government’s “document production performance in these proceedings has been akin to a drop-by-drop water torture” and ordered a preclusion order prohibiting the US Government “from presenting evidence in its case that had been requested by plaintiffs in the Requests for Production, but which has not been produced” as of the date of the order. The US was also still required to produce the documents, whether they planned to use them or not. Judge Hollows also noted that the “Plaintiff has not waived any motion to seek further sanctions regarding non-production of documents, or spoliation of documents.”
Defendant Appeals Sanctions, Only to See Sanction Amount Raised on Appeal. In Multifeeder Tech. Inc. v. British Confectionery Co. Ltd., the defendant had been previously sanctioned $500,000 ($475,000 to the plaintiff and $25,000 to the court) and held in contempt of court by the magistrate judge for spoliation, who also recommended an adverse inference instruction be issued at trial. The defendant appealed to the district court, where Minnesota District Judge John Tunheim increased the award to the plaintiff to $600,000. Oops!
eDiscovery Sanctions Can Happen in Police Brutality Cases Too. As reported in the Seattle Times, Pierce County (Washington) Superior Court Judge Stephanie Arend issued a $300,000 sanction against King County for failure to produce key documents illustrating the previous troubling behavior of a sheriff deputy who tackled Christopher Sean Harris and left him permanently brain-damaged. Judge Arend also indicated that the county would be liable for attorneys' fees and possibly compensatory damages for the Harris family. This after King County had settled with the Harris family for $10 million in January 2011 during a civil trial in King County Superior Court.
When is a Billion Dollars Not Enough? When it’s Apple v. Samsung, of course! According to the Huffington Post, Apple Inc. requested a court order for a permanent U.S. sales ban on Samsung Electronics products found to have violated its patents along with additional damages of $707 million on top of the $1.05 billion dollar verdict won by Apple last month, already one of the largest intellectual-property awards on record.
No Sanctions For Spoliation With No Bad Faith. In Sherman v. Rinchem Co., the plaintiff in a defamation case against his former employer appealed the district court’s denial of both his summary judgment motion and request for an adverse inference jury instruction. The district court had decided the case under Minnesota law, which “provides that ‘even when a breach of the duty to preserve evidence is not done in bad faith, the district court must attempt to remedy any prejudice that occurs as a result of the destruction of the evidence.’” In contrast, as the Eighth Circuit pointed out, in this case where the parties had diversity, and a question remained as to whether state or federal spoliation laws were applicable, federal law requires “a finding of intentional destruction indicating a desire to suppress the truth” in order to impose sanctions.
Pension Committee Precedent Takes One on the Chin. In Chin v. Port Authority of New York and New Jersey, the Second Circuit Court of Appeals ruled it was within a district court’s discretion not to impose sanctions against a party for its failure to institute a litigation hold.
More Sanctions for Fry’s Electronics. In E.E.O.C. v Fry’s Electronics, Inc., Washington District Judge Robert S. Lasnik ordered several sanctions against the defendant in this sexual harassment case (including ordering the defendant to pay $100,000 in monetary sanctions and ordering that certain evidence be considered presumptively admissible at trial), but stopped short of entering a default judgment against the defendant. This ruling came after having previously ordered sanctions against the defendant less than two months earlier.
No Sanctions When You Can’t Prove Evidence Was Destroyed. In Omogbehin v. Cino, the plaintiff claimed that the District Court erred in denying his motion for spoliation sanctions and appealed to the US Third Circuit Court of Appeals, but lost as the appellate court upheld the rulings by the district judge and magistrate judge.
“Naked” Assertions of Spoliation Are Not Enough to Grant Spoliation Claims. In Grabenstein v. Arrow Electronics, Inc., Colorado Magistrate Judge Kristen L. Mix denied the plaintiff’s motion for sanctions, finding that their claims of spoliation were based on “naked” assertions that relevant eMails must exist even though the plaintiff could not demonstrate that such other eMails do or did exist. The motion was also denied because the plaintiff could not establish when the defendant had deleted certain eMail messages, thereby failing to prove claims that the defendant violated its duty to preserve electronic evidence. Judge Mix noted that sanctions are not justified when documents are destroyed in good faith pursuant to a reasonable records-retention policy, if that’s prior to the duty to preserve such documents.
Spoliation of Data Can Lead to Your Case Being Dismissed. In In 915 Broadway Associates LLC v. Paul, Hastings, Janofsky & Walker, LLP, the New York Supreme Court imposed the severest of sanctions against the plaintiffs for spoliation of evidence – dismissal of their $20 million case.
Better Late Than Never? Not With Discovery. In Techsavies, LLC v. WFDA Mktg., Inc., Magistrate Judge Bernard Zimmerman of the United States District Court for the District of Northern California sanctioned the defendant for repeated failures to produce responsive documents in a timely manner because of their failure to identify relevant data sources in preparing its initial disclosures.
The Zubulake Rules of Civil Procedure. As noted in Law Technology News, the New York Appellate Division has embraced the federal standards of Zubulake v. UBS Warburg LLC, in two case rulings within a month’s time, one of which resulted in sanctions against one of the parties for spoliation of data.
eDiscovery Violations Leave Delta Holding the Bag. In the case In re Delta/AirTran Baggage Fee Antitrust Litig., U.S. District Judge Timothy Batten ordered Delta to pay plaintiff attorney’s fees and costs for eDiscovery issues in consolidated antitrust cases claiming Delta and AirTran Holdings, Inc. conspired to charge customers $15 to check their first bag. Noting that there was a “huge hole” in Delta’s eDiscovery process, Judge Batten reopened discovery based on defendants’ untimely production of records and indications that there was overwriting of backup tapes, inconsistencies in deposition testimony and documents, and neglect in searching and producing documents from hard drives.
Burn Your Computer and the Court Will Burn You. In Evans v. Mobile Cnty. Health Dept., Alabama Magistrate Judge William Cassady granted a motion for sanctions, including an adverse inference instruction, where the plaintiff had burned and destroyed her computer that she used during the time she claimed she was harassed.
Appeals Court Decides Spoliation Finding For Not Producing Originals is Bull. In Bull v. UPS Inc., the Third Circuit court conceded that “producing copies in instances where the originals have been requested may constitute spoliation if it would prevent discovering critical information”. However, it found that in this case, the District Court erred in finding that spoliation had occurred and in imposing a sanction of dismissal with prejudice.
So, what do you think? Did you miss any of these? Please share any comments you might have or if you’d like to know more about a particular topic.Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.