In Blue Sky Travel & Tours, LLC v. Al Tayyar, No. 13-2500 (4th Cir. Mar. 31, 2015), the Fourth Circuit vacated an order imposing sanctions on the defendants after finding the magistrate judge applied an incorrect legal standard to conclude the defendants spoliated certain documents.  The magistrate judge held that once the defendant received notice of litigation, it was required “to stop [its] normal document retention policies and to preserve all documents because you don’t know what may or may not be relevant.”  The Fourth Circuit held the magistrate judge erred because “a party is not required to preserve all its documents but rather only documents that the party knew or should have known were, or could be, relevant to the parties’ dispute.”  The circuit court remanded the case to determine whether the defendants knew or should have known the documents at issue were relevant to the plaintiff’s case when the invoices were discarded.