The Judge that brought us the now famous Zubulake series of legal hold decisions has weighed in on the state of litigation holds in the United States. Her latest decision considers facts over a period of time from pre-Zubulake through the present. In a lengthy and well researched opinion (including 251 footnotes) the Judge carefully analyzes the state of legal hold law in the United States (a footnote suggests the Judge and two law clerks spent over 300 hours researching and writing the opinion).
Since issuing the Opinion on January 11, 2010, the Judge amended it on January 15, 2010. Why? I suspect some friends in the e-discovery world gave the Judge an earful on her position that backup tapes of key players must be preserved to avoid spoliation sanctions. Words to this effect appeared twice in the Opinion. The amendment removed this overreaching requirement. The Opinion now discusses preservation of backup tapes as follows:
To avoid gross negligence, among other things "preserve backup tapes when they are the sole source of relevant information or when they relate to key players, if the relevant information maintained by those players is not obtainable from readily accessible sources.”
If you do not feel like reading all 98 pages, here are a few key takeaways:
1. When faced with anticipated litigation (aka a trigger event) a litigant in federal court must issue a written litigation hold. (Yes, the Opinion says it must be in writing.) That means, to avoid being grossly negligent as a matter of law a written notice must be delivered to custodians of relevant evidence once the duty to preserve evidence is triggered. So if you had any doubts about whether a legal hold notice is required, this Judge just removed it. To be clear: in order to avoid sanctions and implement a legal hold you MUST issue a written legal hold notice (at least in the Southern District of New York, and I suspect any jurisdiction that has cited to Zubulake as requiring a litigation hold).
2. Identify all of the key players and ensure that their electronic and paper records are preserved.
3. Cease the deletion of email and preserve the records of former employees that are in a party's possession, custody, or control; and
4. Preserve backup tapes when they are the sole source of relevant information or when they relate to key players, if the relevant information maintained by those players is not obtainable from readily accessible sources.
Why the legal duty to issue a written litigation hold? Reading between the lines of the Opinion, it is very clear that the Judge views the time spent on the "detour" of this spoliation motion and passing judgment on the failure to preserve evidence as a huge waste of judicial resources. Rather than reviewing reams of motion papers and conducting hearings on the sufficiency of a party's preservation efforts; looking at an audit trail of actions following a written litigation hold is much more economical. As a result, the Judge titled her Opinion, Zubulake Revisited: Six Years Later. The ominous message of the subtitle shows that to Judge Scheindlin nothing has changed in six years. Litigants still do not understand that preserving evidence means just that, preserving evidence. To drive the point home she wrote:
"By now, it should be abundantly clear that the duty to preserve means what it says and that a failure to preserve records, will inevitably result in the spoliation of evidence."
We are finishing off a lengthy white paper about the decision and will have it posted soon, but for those of you who want to read the Opinion now, its too important not to post a copy here.
For a copy of the Amended Opinion and Order of Judge Scheindlin in The Pension Committee of Montreal, et al. v. Banc of America Securities, et al., 05 Civ. 9016 (SDNY Jan. 15, 2010), click here: Download Pension Committee v Banc of America 05cv9016 SDNY Jan 15 2010 Amended Opinion