Information not originally thought to be relevant may become a vital resource in laying the groundwork for your case. However some materials absent specific notice may be purged pursuant to a written document retention policy thereby providing opposing counsel and his/her client safe harbor protection under Rule 37(f) of the Federal Rules of Civil Procedure. On the other hand if you can provide notice as to potentially relevant information, and opposing counsel fails to preserve this information opposing counsel and his/her client will potentially be subject to serious sanctions.1 The universe of responsive documents can be further expanded using interrogatories designed to ascertain relevant electronic information systems that may contain information relevant to your litigation. (This process will also facilitate understanding of opposing counsel’s technological infrastructure, information that will be useful in the event opposing counsel claims data are inaccessible.)
The scenario is illustrated by a recent case in the Southern District of New York. In Arista Records, LLC v. Usenet.com Inc., 2009 WL 185992 (S.D.N.Y. Jan. 26, 2009). In Arista (at page 26-27) the Court found the evidence at issue (Usenet usage logs) to be “transitory in nature” and “not routinely created or maintained” in the regular course of business. Nevertheless the Court found that while the:
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Defendants may not have had an obligation to preserve such evidence until placed on notice that Plaintiffs considered it relevant and were requesting it. However, Plaintiffs explicitly requested the Usage Data on January 7, 2008. Moreover, there can be no doubt that the Digital Music Files [and Usenet usage logs] are highly relevant to this case, and Defendants should have been aware of their relevance no later than the date on which the Complaint was filed. In any event, Plaintiffs specifically requested, and sought assurances on March 11, 2008, that these files would be retained. Id. at p. 15.
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Rule 37(f) of the Federal Rules of Procedure limits sanctions for the loss of ESI in certain cases. Rule 37(f) provides that “Absent exceptional circumstances, sanctions cannot be imposed for loss of ESI resulting from a routine, good faith operation of an electronic information system.” This Rule responds to a distinctive and necessary feature of computer systems — the recycling, overwriting, and alteration of electronically stored information that attends normal use. This Rule however is not intended to provide a shield for a party that intentionally destroys specific information because of its relationship to litigation, or for a party that allows such information to be destroyed in order to make it un-available in discovery by exploiting the routine operation of an information system. Depending on the underlying circumstances (including notice), good faith may require that a party intervene to modify or suspend certain features of the routine operation of a computer system to prevent the loss of information, if that information is subject to a preservation obligation.
A recent case in the Northern District of California provides one example of the application of this safe harbor. In this case a party without reasonable notice that a given class of documents was relevant to a pending litigation was protected under Rule 37(f) from sanctions when the information was purged as part of the defendant company’s document retention policy. In Gippetti v. UPS, Inc., 2008 WL 3264483 (N.D. Cal. Aug. 6, 2008)2, the plaintiff requested discovery of digital records, called “tachographs” showing the fleet vehicles’ speeds and the length of time they are moving or stationary, to support his claim that other drivers were not disciplined for the same alleged infractions. Most of this information had been purged pursuant to a document retention policy. The plaintiff then moved for spoliation sanctions, claiming that the defendant knew or should have known that the tachographs would be relevant to the litigation
In this instance, however, the defendant company:
- Had a documented retention policy that provided tachgraphs were retained for only 37 days;
- The Company produced existing tachograph records covering the most recent two-month period of time (the only available records given the document retention policy; and
- The Company’s document retention policy dated back to 2002, a date prior to the litigation.
The Court found sanctions to be inappropriate because the defendant has no notice that tachographs were relevant to his claims, that they were not directly related to the defendant’s affirmative defense, and they were destroyed in accordance with a routine company policy.
In some instances courts have even failed to sanction a part even though relevant information may have been lost due to routine computer maintenance activities. See Maxpower Corp. v. Abraham, 2008 WL 1925138 (W.D. Wis. April 29, 2008). Former employees who went to work for a competitor, of the plaintiff obtained an order allowing it to inspect the former employees’ laptop hard drives. However, the plaintiffs’ computer forensic expert determined that the defendants’ laptops found that the evidence of hard drive wiping. The inspection established that the former employees had deleted information from the hard drives after the suit had been filed. However, the defendants presented evidence that the wiping of their laptops was done for maintenance purposes. The Court denied the plaintiffs’ motion for sanctions, finding insufficient evidence to support the argument that wiping the hard drive constituted deliberate spoliation.
1 See e.g. Qualcomm Inc. v. Broadcom Corp., 2008 U.S. Dist. LEXIS 911, 2008 WL 66932 (S.D. Cal. Jan. 7, 2008) (“Qualcomm II”). Following a finding of “gross litigation misconduct (see “Qualcomm I”), the Magistrate Judge ordered the plaintiff corporation to pay an $8.5 million sanction, and individually sanctioned six attorneys for intentionally or recklessly failing to meet discovery obligations and for accepting without question their corporate client’s representations that discovery responses were complete. The six attorneys were ordered to forward the sanction order to the state bar for possible further disciplinary actions. The corporation’s legal department was ordered to initiate a self-critical review and amelioration program which the court entitled a “Case Review and Enforcement of Discovery Obligations (CREDO)” program and to report its findings and going-forward case management protocols in open court. The order was vacated in part and remanded, 2008 WL 638108 (S.D. Cal. March 5, 2008) by the District Judge, who applied the self-defense exception to the attorney-client privilege, allowing the outside attorneys to use their communications with Qualcomm to show cause why they should not be sanctioned.
2 This case was an age discrimination employment suit where the defendant raised the affirmative defense that the plaintiff delivery truck driver was terminated for taking excessive rest and lunch breaks.
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