In Warren v. Amchem Products, Inc., Justice Peter Moulton sanctioned defendant J-M Manufacturing Company for destroying documents in 1990 and 1997 – 24 years and 17 years, respectively, before the Warren Estate filed suit against asbestos manufacturers in 2014. The Court granted plaintiff’s motion for spoliation sanctions and ordered that, should the case proceed to trial, the jury will be instructed that it may infer that the destroyed documents would have supported plaintiff’s claims and would not have supported J-M’s defenses.
Tagged: Records Destruction
In Pegasus Aviation I, Inc. v. Varig Logistica S.A., the New York Court of Appeals held that failure to preserve ESI was simple, not gross, negligence, and remanded to the trial court for a determination of whether the destroyed evidence was relevant to the plaintiff’s claims and what sanction, if any, is appropriate.
Takeda Part Two: Destroy Evidence, Pay the Price — Eli Lilly and Takeda Pharmaceutical Co. Get Hit For $9 Billion Punitive Damages Verdict
Recently, in In re Actos (Pioglitazone) Products Liability Litigation, MDL No. 11-2299, a Louisiana federal jury awarded $9 billion in punitive damages against Takeda Pharmaceutical Co. (“Takeda”) and Eli Lilly & Co. (“Lilly”). The verdict was delivered on the heels of Judge Rebecca Doherty’s January opinion, which lambasted Takeda for failing to (1) enforce its own litigation hold and (2) follow its document retention procedures, which led to the destruction of relevant evidence that Judge Doherty found would have likely been beneficial for the plaintiffs’ case.
Recently, the New York Supreme Court, Appellate Division, First Department considered whether to adopt and apply the Zubulake standard for the spoliation of electronically-stored information (“ESI”) to a claim for spoliation of an audiotape recording or whether existing New York spoliation doctrine was sufficient. Strong v. City of New York involved a June 30, 2009, accident in which an NYPD vehicle collided with another vehicle, jumped the sidewalk curb and struck five pedestrians, including plaintiff, Kevin Strong. Within 30 days of the accident, three plaintiffs commenced personal injury actions and these were consolidated for trial. On September 21, 2009, less than 90 days after the accident, the City joined issue and interposed the “emergency operation” defense, claiming the police officer’s vehicle was an authorized emergency vehicle engaged in an emergency operation at the time of the accident and, therefore, the City could only be held liable if the officer had acted with reckless disregard for the safety of others.
Coming to a Close: Reflections on the Proposed Amendments to F.R.C.P. 37 Debate at the 2013 Georgetown Advanced eDiscovery Institute as the End of the Public Comment Period Nears
The proposed amendments to F.R.C.P. 37(e) would establish a single standard by which courts will assess culpability and issue sanctions for failure to preserve electronically stored information (“ESI”). Our previous blog post discusses the rule. The proposed amendments to F.R.C.P. 37(e) were recommended for adoption in 2010 and, on June 3, 2013, they were approved for public comment (as part of a package of amendments to several federal rules) by the Judicial Conference of the United States’ Standing Committee on Rules of Practice and Procedure. On August 15, 2013, the Committee officially published for public comment the full slate of proposed rule changes. Unsurprisingly, the proposed amendments have generated considerable feedback from the legal community and, indeed, the discussion took center stage at the 2013 Georgetown Advanced eDiscovery Institute on November 22, 2013. With little more than a week to go before the comment period expires, and with, to date, more than 600 comments already posted addressing various aspects of the proposed rule amendments, we thought it might be a good time to reflect upon the discussion at Georgetown, especially for those considering weighing in before the end of the public comment period.
Florida Joins the Growing Number of States That Have Adopted Specific Rules Addressing Electronic Discovery
Effective September 1, 2012, Florida joined the long list of states that have adopted specific rules of procedure governing electronic discovery, which follows the July 5, 2012, announcement by the Supreme Court of Florida of its proposed amendments to seven civil procedure rules aimed at addressing the specific dilemmas facing litigants when e-discovery is sought. Florida’s Supreme Court approved and adopted the amendments in a formal opinion issued on July 5, 2012. While these amendments generally mirror the amendments to the Federal Rules of Civil Procedure first adopted by the United States Supreme Court in 2006, they diverge from the Federal Rules in some critical areas.
How a Case Can Crash and Burn: Why a Litigant Should Not Set Afire a Computer After It Crashes (Preservation 101)
In Evans v. Mobile County Health Department, 2012 U.S. Dist. LEXIS 8530 (S.D. Ala. Jan. 24, 2012) , a magistrate judge sitting in the Southern District of Alabama (Southern Division) was recently faced with the question of whether plaintiff’s intentional burning of a personal computer, which contained discoverable ESI, was worthy of an imposition of sanctions.The defendant, Mobile County Health Department, filed motions to compel discovery and to impose sanctions stemming from plaintiff’s alleged spoliation of critical information and repeated failures to produce discoverable documents and ESI. Based upon the facts and arguments presented to the magistrate, most notably plaintiff Evans’ admission that she destroyed and replaced her personal computer, the Court granted defendant’s motions.
The SEC recently admonished its enforcement staff attorneys to cease any efforts to purge documents from investigative files amidst criticism that the agency wrongfully destroyed thousands of documents related to high profile enforcement matters, including major fraud investigations involving Wall Street banks. The cease order was disclosed in a letter last month from the SEC’s general counsel. The order was precipitated by a whistleblower — long-time SEC enforcement attorney Darcy Flynn — who advised key congressional representatives that the agency had destroyed thousands of investigative files from preliminary enforcement investigations (internally referred to as “MUIs” — or matters under inquiry).
Confidentiality agreements and protective orders are a commonplace, yet indispensable, feature of modern commercial litigation. These agreements are typically the end result of a series of negotiations between counsel specifically designed to balance the seemingly incompatible objectives of ensuring ready access to vital evidence and ensuring that sensitive information, such as trade secrets, remains carefully shrouded from the public eye and industry competitors. The importance of ensuring that sensitive information remains confidential vis-à-vis the world at large during a lawsuit cannot be overstated. Confidentiality agreements often provide detailed provisions addressing who may access information and how information may be used. Once the litigation has concluded, parties are often faced with the sometimes challenging task of ensuring that all confidential information is either returned to the producing party or destroyed. Without proper planning, it may be difficult to put the proverbial genie back into the bottle.
Orbit One: Inadequate ESI Preservation Does Not Merit Sanctions Absent Evidence That Relevant Information Has Been Destroyed
Orbit One Communications, Inc. v. Numerex Corp., 2010 WL 4615547 (S.D.N.Y. Oct. 26, 2010) represents a dichotomy in jurisprudence on ESI preservation efforts and the imposition of automatic sanctions. In Orbit One, Magistrate Judge James C. Francis, IV found that regardless of how inadequate a litigant’s preservation efforts may be, sanctions are not appropriate without proof that “information of significance” has been lost. The court determined that the threshold determination must be “whether any material that has been destroyed was likely relevant even for purposes of discovery.” In so holding, the court discussed and diverged from Judge Shira A. Scheindlin’s decision in Pension Committee of the University of Montreal Pension Plan v. Banc of America Securities, LLC, which earlier held that sanctions may be warranted for inadequate preservation efforts even if no relevant evidence is lost. 685 F. Supp.2d 456, 465 (S.D.N.Y. 2010).