Court Orders Production of Litigation Hold Letters

The general rule in the United States is that litigation hold notices are not discoverable.  Litigation hold or legal hold notices are usually internal letters, memorandum or e-mails directing members of an organization to preserve evidence in support of a litigation hold implemented by the organization related to an event that has triggered the duty to preserve evidence.  Two reasons exist for protecting the production of litigation hold notices.  One, most notices are issued by an attorney or at the direction of an attorney and contain attorney-client privileged communications or constitute attorney-work product. Two, at least one court has held that disclosure of litigation hold notices “could dissuade other businesses from such instructions in the event of litigation.”  Gibson v. Ford Motor Co., 510 F.Supp.2d 1116, 1123 (N.D. Ga. 2007). 

In certain circumstances, however, litigation hold notices are discoverable.  As a result, it is wise to craft notices with the idea that some day they may be read by a judge or an opponent.  The case Major Tours v. Colorel, 2009 U.S. Dist. LEXIS 68128 (DNJ Aug. 4, 2009), is an example of the circumstances that will lead a court to order the production of litigation hold letters.  The case contains a good overview of existing law related to the disclosure of litigation hold letters.  The case also tells a cautionary tale of things to avoid when implementing litigation holds and conducting 30(b)(6) depositions in support of  litigation holds.

In Major Tours, the court held that the trigger event giving rise to the pre-litigation duty to preserve evidence was a letter from plaintiffs’ counsel dated September 11, 2003.  The letter to New Jersey officials alleged racial profiling of African American owned bus charter companies who charter trips to casinos in Atlantic City.  Although therewere earlier complaints by constituents of Senator Arlen Specter communicated to New Jersey, the attorney’s letter suggested that “the operators are entitled to monetary compensation for the tens of thousands of dollars of losses which they have suffered.”  The attorney letter asked for a response “within two weeks in order to avoid recourse to litigation.”  The court held that letter was strong enough to cause a reasonable anticipation of litigation, even though the complaint was not filed until June 15, 2005, nearly two years later.

Upon a full factual record the court held that the earliest defendants mentioned e-mail preservation was in a November 4, 2005 letter and that the first formal litigation hold letter was not issued until March 22, 2007.  The court declined to rule on whether the November 4, 2005 letter was an adequate litigation hold notice.  As a result of the time lapse between September 11, 2003 and either the 2005 or 2007 letters, the court held that it was reasonable to infer “that some relevant evidence was lost.”

In addition to the lapse of time, the court cited to defendants’ testimony obtained during FRCP Rule 30(b)(6) depositions in which defendants' witnesses were asked about their litigation hold efforts.

When Michael Colorel, Principal Investigator for the CBIU, was asked on February 8, 2007 whether he was advised by his lawyers to preserve his email communications regarding claims of racial discrimination, he answered that he was "probably" told by his lawyers to do so, but additionally admitted, "I don't sa[v]e anything."  Maryann Mazon, another Rule 30(b)(6) witness, testified on April 3, 2008 that no one ever talked to her about creating a litigation hold policy and that she was not sure what a litigation hold policy was.

The District Court discussed the general rule in the United States that litigation hold letters are not discoverable, citing to a string of opinions.  The court went on to hold that a general exception to this rule has also developed.  “[W]hen spoliation occurs the letters are discoverable.” 

See Keir v. Unumprovident Corp., No. 02-CV-8781(DLC), 2003 WL 21997747 at *6 (S.D.N.Y. Aug. 22, 2003)(allowing detailed analysis of emails pertaining to defendant's preservation efforts after finding that electronic records which had been ordered preserved had been erased). See also Zubulake v. UBS Warburg LLC, 229 F.R.D. 422, 425 nn.15-16 (S.D.N.Y. 2004) ("Zubulake V")(disclosing the details of counsel's litigation hold communication after discovering that at least one e-mail had never been produced); Cache La Poudre Feeds, LLC v. Land O'Lakes, Inc., 244 F.R.D. 614, 634 (D. Colo. 2007)(permitting plaintiff to take a Rule 30(b)(6) deposition to explore the procedures defendants' counsel took "to identify, preserve and produce responsive documents" after finding that defendants expunged the hard drives of several former employees after the present litigation had began).

The court did not rule on spoliation sanctions because the issue was squarely whether the litigation hold letters are discoverable. The spoliation issue will be revisited in the future. The court held:

Although the Third Circuit has not ruled on the issue, most applicable authority from around the country provides that litigation hold letters should be produced if there has been a preliminary showing of spoliation. The Court is satisfied that Plaintiffs have made this showing. Consequently, the Court will grant Plaintiffs' application and order the production of Defendants' hold letters. 

Major Tours, *4 (footnote omitted).  To obtain a copy of the Opinion and Order, click here: Download Major Tours v Colorel - DNJ 8-4-09