Legal Holds and Trigger Events

New Legal Hold Projects

We are working to help update the current Wikipedia resource for the term Legal Hold and have started collecting benchmarking information about the legal hold best practices of organizations of all shapes and sizes.  For more information please see Legal Hold Projects.

Spoliation Sanctions Motion Denied Where Only Evidence in Support Was Off-handed Guess at Date of Litigation Hold During Defendants' Deposition

Rahman v. The Smith & Wollensky Restaurant Group, 2009 WL 773344 (SDNY 3-18-09) (spoliation motion denied due to lack of evidence of alleged failure to initiate litigation hold and lack of evidence that any alleged failure to initiate litigation hold contributed to spoliation.)

In this very contentious employment discrimination lawsuit, the court was not persuaded by the scant evidence submitted in support of plaintiff’s motion for spoliation sanctions. Plaintiff alleged that a gap in documents produced in the case was the result of defendants’ failure to implement a litigation hold. Plaintiff failed, however, to submit sufficient evidence that 1) defendants failed to implement a litigation hold when the lawsuit was initiated, and 2) any gap in documents was the result of the failure to properly implement a litigation hold. This matter was initiated in 2006. Plaintiff’s sole evidence in support of his motion was aptly summarized by the court:

“The plaintiff presents, as proof of the defendants’ alleged spoliation, [one witness’s] single ambiguous statement that the defendants instigated a litigation hold in ‘Summer of 2008, maybe’ rather than when the lawsuit commenced in August 2006.”

The court held that this isolated statement is insufficient to support a finding of spoliation. The court went on to further hold that even “assuming there was, in fact, no litigation hold until the summer of 2008, the plaintiff has failed to establish that any gap in the [document] production is attributable to the failure to institute a litigation hold at an earlier date.”

As a result of the lack of evidence, the court denied plaintiff’s motion for spoliation sanctions. It is important to note that the court did not cite any litigation hold cases for its analysis. Rather, the court cited to Second Circuit precedent: “A party seeking sanctions for the spoliation of evidence must show “(1) that the party having control over the evidence had an obligation to preserve it at the time it was destroyed; (2) that the records were destroyed ‘with a culpable state of mind’; and (3) that the destroyed evidence was ‘relevant’ to the party’s claim or defense such that a reasonable trier of fact could find that it would support that claim or defense.”

Rahman, p. 14, Footnote 9 (citations omitted). For a copy of the opinion click here: http://legalholds.typepad.com/legalholds/new-cases.html.

 

Lack of Evidence of Claimed Failure to Implement a Litigation Hold Results in Denial of Sanctions Motion

Superior Production Partnership, d/b/a PBSI v. Gordon Auto Body Parts Co., 2009 WL 690603 (S.D.Ohio 3/12/09) (lack of evidence of claimed failure to implement a litigation hold leads to denial of plaintiff's motion for sanctions.)

The court in this matter was constrained by the lack of evidence submitted in support of plaintiff's motion seeking spoliation sanctions. The case had been pending since 2006 and a substantial amount of discovery had taken place including several conferences with the court and a motion to compel.  Despite this history, plaintiff was only making a motion relating to the failure to implement a litigation hold now, rather than closer to the initiation of the lawsuit.  The length of time also cut against the plaintiff due to the lack of evidence of a failure to implement a litigation hold or spoliation, given the amount of discovery that had taken place in the case.

The court viewed the dispute as "not a legal one, but a factual one. Both parties agree that the filing of a lawsuit triggers an obligation on the part of the defendants to locate and preserve relevant documents, and that the breach of that obligation may well be sanctionable."

Plaintiff claimed that defendant failed to implement a litigation hold.  In response defendant claimed that its standard document retention policy existed prior to the lawsuit and that the policy prevented the destruction of relevant documents.  Nevertheless, after the first deposition in the lawsuit and to bolster the policy a litigation hold memorandum was issued to employees advising them to retain relevant documents.

The motion involved largely unsupported accusations of spoliation and failure to implement a legal hold. Specifically, there was no evidence before the court supporting a failure to follow a retention policy or implement a litigation hold.  Without citation, the court noted that "the topic of document retention or destruction is a valid subject of discovery, and should [plaintiff] either possess additional evidence on that topic or, as a result of additional discovery, come into the possession of such evidence, it is free to renew its motion."  The court went on to hold that "[i]n the absence of additional evidence, however, the Court is constrained to deny the motion as filed."

Plaintiff's motion for sanctions was denied. For a copy of the opinion click here: http://legalholds.typepad.com/legalholds/new-cases.html. 

Pre-Litigation EEOC Filing Deemed Trigger Event - Adverse Inference Jury Instruction Request Denied Despite Destruction

Jade Society v. Port Auth. of NY & NJ, 2009 WL 577665, (SDNY 3/5/09) (pre-litigation duty to preserve triggered on date "EEOC charge was served upon the Port Authority.")

 

In this mater, the court held that the Port Authority had a duty to preserve evidence triggered by the filing of EEOC complaints by the various plaintiffs.  Plaintiffs argued that the Port Authority should be sanctioned for failing to implement a legal hold and failing to preserve performance evaluations that were destroyed.  The Port Authority offered a number of inconsistent excuses including that files were destroyed in the 9-11 attack on the World Trade Center.  The court held that the destruction was merely negligence, and did not warrant an adverse inference charge.  No other sanctions were discussed and the plaintiffs' motion was denied.  For a copy of the opinion click here: http://legalholds.typepad.com/legalholds/new-cases.html.

Court holds that failure to implement a litigation hold is gross negligence and awards motion costs and attorneys fees

Acorn v. Co. of Nassau, 2009 WL 605859, (EDNY 3/9/09) ("the failure to implement a litigation hold at the outset of litigation amounts to gross negligence.") (awarded sanction of motion costs and attorneys fees for failing to implement a litigation hold).  In this case the County of Nassau claimed that it issued a "verbal" litigation hold.  The court was not persuaded and cited to the lack of evidence (like an affidavit) from anyone that allegedly received the verbal litigation hold.  Plaintiffs also suffered at the hands of lack of evidence, by failing to demonstrate that the missing ESI was relevant enough to warrant the harsh sanction of an adverse inference charge.  The court held, however, that the failure to implement a litigation hold required a monetary sanction to punish defendant's conduct.  The court awarded the costs of the motion and attorneys fees.  

You can download the district court's opinion from our New Cases Page: http://legalholds.typepad.com/legalholds/new-cases.html

Welcome!

We are working on creating the best source for information about Legal Holds on the web. We thought that we were laboring in relative obscurity.  Our hope was to post useful information over the course of a few weeks and then go "public." It turns out that we are already public and are currently receiving an average of 60 (formerly 22) visitors a day. 

If you are a first time visitor or are checking back, we welcome your suggestions and questions. As we move forward we will be posting more information about developing and implementing legal holds, legal hold policies, best practices, benchmarking information and court cases.  We will develop more detailed information about known trigger events to help organizations identify when they are being presented with a scenario that may trigger the duty to preserve documents and electronicically stored information ("ESI"). 

It is our goal, that the information will be useful to you and that you will enjoy returning to the site frequently or adding us to your RSS reader.

Thank you for visiting.

7 Steps for Developing and Implementing Legal Holds of ESI and Other Documents

For a preview of the upcoming ARMA International publication: Seven Steps for Developing and Implementing Legal Holds of ESI and Other Documents, click here: Download Coupon Legal Hold Book

Legal Hold Workshop