A pair of recent district court decisions underscores the importance of issuing a written and comprehensive litigation hold notice when litigation becomes reasonably foreseeable.
In The Pension Committee v. Banc of America Securities, LLC, Judge Shira Scheindlin, the author of the Zubulake e-discovery opinions, addressed negligent or unintentional failures to preserve, collect, and produce documents, including electronically stored information (ESI).
Judge Scheindlin concluded that whether the preservation or discovery conduct is acceptable in a case depends on what is reasonable, which in turn depends on whether what was done or not done was proportional to the circumstances and consistent with clearly established applicable standards. Because these standards vary from circuit to circuit, the analysis cannot be reduced to a generalized check list.
Significantly, Judge Scheindlin held that, at least in her court, the failure to issue a written litigation hold notice would be deemed gross negligence. She also held that the "failure to obtain records from all employees likely constitutes negligence," even if the employees have had only a passing encounter with the issues in the litigation and are not key players. The failure to take all appropriate measures to preserve electronically stored information and the "failure to assess the accuracy and validity of search terms for collecting electronically stored information" also likely constitute negligence.
Rimkus Consulting Group, Inc. v. Cammarata, et al. applied Judge Scheindlin's analytical approach to the alleged intentional destruction of electronically stored evidence. The defendants in Rimkus had previously been plaintiffs in a "preemptive" action they brought against Rimkus in another jurisdiction. The court held that the obligation to preserve arose when the defendants decided to sue Rimkus. Instead of preserving ESI at that point, however, the defendants continued to apply routine destruction policies to relevant materials. Judge Rosenthal flatly rejected the argument that storage space limitations required regular deletion of the e-mails that filled the defendants' mailboxes and servers.
Nonetheless, because some of the deleted materials were recovered from other sources, some of the deleted materials were favorable to defendants, and the plaintiff had extensive evidence to prosecute its claims and respond to defenses without the deleted materials, Judge Rosenthal held that the most severe sanctions were not justified. She further imposed a mild form of adverse inference instruction, along with the requirement that defendants pay the plaintiff's reasonable costs and fees in identifying the spoliation and litigating the consequences.