Federal Judge Rules Government Failed to Preserve Text Messages and Orders Adverse Inference Instruction in Criminal Case

On October 21, 2010, in the highly publicized New Jersey government corruption case U.S. v. Suarez, et ano., No. 09-932, 2010 U.S. Dist. LEXIS 112097 (D.N.J.), the Honorable Jose L. Linares, U.S.D.J., held that the FBI had a duty to preserve Short Message Service electronic communications (i.e., text messages) exchanged between its agents and their cooperating witness, Solomon Dwek, during the course of the investigation of defendants Anthony Suarez (mayor of Ridgefield, NJ) and Vincent Tabbachino (former Guttenberg, NJ councilman and police officer). Despite the lack of evidence of bad faith on the part of the government, because the text messages were not preserved, the Court found clear prejudice to defendants and ordered that the appropriate sanction was a “permissive” adverse inference jury instruction.

From March to July 2009, Dwek assumed the identity of a real estate developer to assist the FBI with its corruption investigation of local public officials. Specifically, the FBI instructed Dwek to meet with the officials to express interest in real estate development projects and to offer bribes to them in exchange for expediting the projects and providing other official assistance. In substance, the text messages exchanged between Dwek and the agents during this period concerned investigation logistics, Dwek’s impressions of what was transpiring during the investigation and the agents’ instructions to Dwek in carrying out the investigation (e.g., encouraging Dwek to be “blatant” and to “dirty up the money”).

Shortly after defendants moved to compel production of the text messages, the government agreed to produce them but later advised that it could not do so. The government explained that Dwek used a personal cell phone to transmit text messages, which his carrier retained for only 3 to 5 days. As to the text messages originating from or received on the agents’ Blackberry® handheld devices, the government ultimately admitted that it failed to preserve many of these messages, notwithstanding its document retention policy concerning “reasonably anticipated or pending litigation.” The government did not issue a litigation hold until on or about January 11, 2010, long after the subject data would have been destroyed in the normal course of business.

The Court found that the text messages were discoverable under the Jencks Act, 18 U.S.C. § 3500, and Federal Rule of Criminal Procedure 26.2 and should have been preserved and produced. The Court declined to impose the harsh sanction of suppressing Dwek’s testimony and all tape recordings in which he participated, but carefully analyzed the propriety of giving the jury one of various forms of adverse inference instructions. Consulting the Honorable Shira A. Scheindlin’s decision in Pension Committee of the University of Montreal Pension Plan v. Banc of America Securities, LLC, 685 F. Supp. 2d 456 (S.D.N.Y. 2010) (corrected in part by Order dated May 28, 2010), the Court ordered the most “flexible” and “least harsh” adverse inference instruction: permitting, but not requiring, the jury to presume that the lost text messages were both relevant and favorable to defendants, but mandating that the jury consider rebuttal evidence on these issues. The Court acknowledged that, although defendants were clearly prejudiced in their ability to impeach the government’s cooperating witness, there was “little evidence” to suggest that the government acted in bad faith. On October 27, 2010, the jury acquitted defendant Suarez on all counts (conspiracy to commit extortion, attempted extortion and bribery) and convicted defendant Tabbachino of attempted extortion and bribery.

As with all decisions imposing sanctions for spoliation of evidence, U.S. v. Suarez underscores the critical importance of promptly issuing a litigation hold and properly preserving evidence. Failure to discharge these now well established duties, even absent bad faith, can result in severe sanctions that may negatively impact the prosecution of a case, both in the criminal and the civil context.