E-mails,
Excel spreadsheets, Word documents and other electronically stored
information (ESI) are routinely requested as evidence in lawsuits. And
destroying that data, or failing to produce it during the discovery
process can generate some harsh legal penalties.
One court case has become an example for misconduct during e-discovery. The suit in question, Victory Stanley II, involved deleting, destroying and otherwise failing to preserve electronically stored information despite court orders. In its ruling, the court made it clear: There was no question that evidence was intentionally destroyed and lost. These actions prejudiced the case so the judge entered a default judgment in favor of the plaintiff.
But there was more. Magistrate Judge Paul Grimm also found the defendant engaged in "the single most egregious" case of discovery misconduct he had seen in nearly 14 years on the bench. The defendant's "pervasive and willful violation" of court orders was serious enough, he said, to constitute contempt of court. He ordered the defendant to be imprisoned for up to two years, unless and until he paid the plaintiff's attorney fees and costs. (Victor Stanley, Inc. v. Creative Pipe, Inc., No. MJG-06-2662, 2010 WK 3530097)
The court attempted in its 2010 opinion to provide a larger framework to help resolve the issues surrounding the preservation of electronically stored data. Guidelines for complying with e-discovery were set out in another earlier case where the judge said attorneys should:
Issue a "litigation hold" when a suit appears reasonably imminent. This means ordering that evidence be preserved until discovery is complete. The litigation hold should be periodically re-issued so that new employees are aware of it and it remains fresh in the minds of all staff members.
Ensure key players understand what the hold instruction entails. Major players are those who likely have information relevant to a case.
Instruct all employees to produce electronic copies of their relevant active files and ensure that all tapes or copies are identified and stored safely. This may even require keeping them in a separate location to eliminate the possibility that backup tapes could be accidentally recycled. (Zubulake v. UBS Warburg LLC, No. 02-Civ. 1243, S.D.N.Y., 7/20/04)
In Victor Stanley II, the court cited several instances of delaying tactics that resulted in "spoliation" -- the intentional or negligent withholding, hiding, altering, or destroying of evidence relevant to a lawsuit. Among many avoidance tactics, the court noted that the defendant:
1. Made a concerted effort to prevent the discovery of evidence.
2. Failed to issue a litigation hold and did not preserve electronically stored data after the lawsuit was filed.
3. Ignored the demand from plaintiff's counsel to preserve an external hard drive and various files and e-mails.
4. Deleted information, despite several court orders to preserve it.
5. Did not retain electronic information when a company server was replaced.
6. Habitually used programs to permanently delete material after several court orders to produce it.
These violations account for the severity of the sanctions the magistrate judge imposed. But Judge Grimm also noted that determining whether spoliation sanctions are appropriate in cases involving failure to properly preserve electronically stored information has "proven to be one of the most challenging tasks for judges, lawyers, and clients." The judge added that the "lack of a national standard, or even a consensus among courts in different jurisdictions about what standards should govern preservation/spoliation issues, appears to have exacerbated the problem."
In a nutshell, the case is a warning that businesses should be prepared in case they become involved in litigation. Companies should work with their law firms to follow e-discovery best practices. This can significantly improve the ability to furnish electronically stored information. Your organization's attorneys may also recommend hiring an experienced computer forensics professional who can help in several ways, including:
Locate and preserve data. As Victor Stanley II shows, your company must be able to retrieve and preserve old information while maintaining new data. A computer forensics specialist can help assess an organization's ability to do this. This "health check" can prove invaluable, especially if it uncovers a fundamental flaw in storage techniques that might have been uncovered only during the discovery process of litigation.
Maintaining a proper chain of custody helps ensure that data is unaltered and complete. If, during litigation, the integrity or thoroughness of information is questioned, it may not be allowed as evidence. A computer forensics professional also provides assurance that data has not been manipulated.
Minimize disruption. E-discovery requests can take on a life of their own and severely affect daily operations. A computer forensics specialist can help minimize disruption.
Provide insight and guidance. If the data to be turned over to the other side is potentially problematic, a computer forensics professional can warn a company's attorneys. That puts them in a stronger position to handle unexpected issues and avert problems.
Testify to the legitimacy of the discovery. Forensic computer professionals can serve as expert witnesses to testify how the information was gathered. This sends a strong message to the court that appropriate protocols were followed to ensure the information was complete and reliable.
Your company may never wind up in court, but it's a good idea to ensure it is ready just in case. Your attorney and a computer forensics professional can identify the challenges your IT infrastructure may present, which can help your business be more efficient and cost-effective in the way it electronically stores and preserves information.
One court case has become an example for misconduct during e-discovery. The suit in question, Victory Stanley II, involved deleting, destroying and otherwise failing to preserve electronically stored information despite court orders. In its ruling, the court made it clear: There was no question that evidence was intentionally destroyed and lost. These actions prejudiced the case so the judge entered a default judgment in favor of the plaintiff.
But there was more. Magistrate Judge Paul Grimm also found the defendant engaged in "the single most egregious" case of discovery misconduct he had seen in nearly 14 years on the bench. The defendant's "pervasive and willful violation" of court orders was serious enough, he said, to constitute contempt of court. He ordered the defendant to be imprisoned for up to two years, unless and until he paid the plaintiff's attorney fees and costs. (Victor Stanley, Inc. v. Creative Pipe, Inc., No. MJG-06-2662, 2010 WK 3530097)
The court attempted in its 2010 opinion to provide a larger framework to help resolve the issues surrounding the preservation of electronically stored data. Guidelines for complying with e-discovery were set out in another earlier case where the judge said attorneys should:
Issue a "litigation hold" when a suit appears reasonably imminent. This means ordering that evidence be preserved until discovery is complete. The litigation hold should be periodically re-issued so that new employees are aware of it and it remains fresh in the minds of all staff members.
Ensure key players understand what the hold instruction entails. Major players are those who likely have information relevant to a case.
Instruct all employees to produce electronic copies of their relevant active files and ensure that all tapes or copies are identified and stored safely. This may even require keeping them in a separate location to eliminate the possibility that backup tapes could be accidentally recycled. (Zubulake v. UBS Warburg LLC, No. 02-Civ. 1243, S.D.N.Y., 7/20/04)
In Victor Stanley II, the court cited several instances of delaying tactics that resulted in "spoliation" -- the intentional or negligent withholding, hiding, altering, or destroying of evidence relevant to a lawsuit. Among many avoidance tactics, the court noted that the defendant:
1. Made a concerted effort to prevent the discovery of evidence.
2. Failed to issue a litigation hold and did not preserve electronically stored data after the lawsuit was filed.
3. Ignored the demand from plaintiff's counsel to preserve an external hard drive and various files and e-mails.
4. Deleted information, despite several court orders to preserve it.
5. Did not retain electronic information when a company server was replaced.
6. Habitually used programs to permanently delete material after several court orders to produce it.
These violations account for the severity of the sanctions the magistrate judge imposed. But Judge Grimm also noted that determining whether spoliation sanctions are appropriate in cases involving failure to properly preserve electronically stored information has "proven to be one of the most challenging tasks for judges, lawyers, and clients." The judge added that the "lack of a national standard, or even a consensus among courts in different jurisdictions about what standards should govern preservation/spoliation issues, appears to have exacerbated the problem."
In a nutshell, the case is a warning that businesses should be prepared in case they become involved in litigation. Companies should work with their law firms to follow e-discovery best practices. This can significantly improve the ability to furnish electronically stored information. Your organization's attorneys may also recommend hiring an experienced computer forensics professional who can help in several ways, including:
Locate and preserve data. As Victor Stanley II shows, your company must be able to retrieve and preserve old information while maintaining new data. A computer forensics specialist can help assess an organization's ability to do this. This "health check" can prove invaluable, especially if it uncovers a fundamental flaw in storage techniques that might have been uncovered only during the discovery process of litigation.
Maintaining a proper chain of custody helps ensure that data is unaltered and complete. If, during litigation, the integrity or thoroughness of information is questioned, it may not be allowed as evidence. A computer forensics professional also provides assurance that data has not been manipulated.
Minimize disruption. E-discovery requests can take on a life of their own and severely affect daily operations. A computer forensics specialist can help minimize disruption.
Provide insight and guidance. If the data to be turned over to the other side is potentially problematic, a computer forensics professional can warn a company's attorneys. That puts them in a stronger position to handle unexpected issues and avert problems.
Testify to the legitimacy of the discovery. Forensic computer professionals can serve as expert witnesses to testify how the information was gathered. This sends a strong message to the court that appropriate protocols were followed to ensure the information was complete and reliable.
Your company may never wind up in court, but it's a good idea to ensure it is ready just in case. Your attorney and a computer forensics professional can identify the challenges your IT infrastructure may present, which can help your business be more efficient and cost-effective in the way it electronically stores and preserves information.
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