Guidance from the Court: How to Adequately Preserve, Search, Collect Potentially Relevant

http://ow.ly/81wex

An article by Mike Hamilton, J.D. posted on the e-Discovery Beat blog.

This article discusses the recent case of  Naaco Materials Handling Group, Inc. v. Lilly Co. (W.D. Tenn. Nov. 2011) which provides guidance regarding preservation obligations pertaining to electronically stored information.

The case involved allegations of improper access to a password protected website.  The plaintiff also alleged that the defendant had committed discovery violations during the litigation, and sought sanctions.

The article states that the court provided insight into the analysis that should be undertaken to determine if sanctions were merited.  The court looked at preservation obligations, and provided the following directive:

"To preserve data, the court referenced three steps:
(A) Sending out a preservation letter to all key players who might hold potentially relevant evidence,
(B) Suspending the company’s document retention policy of such evidence, and
(C) “Taking steps to preserve active data stored or found on servers, backup tapes, or other media.”"

In addition, the court also discussed collection and review:

"Here is a summary of the lack of effort by Lilly to collect or review evidence:

• After being served with the complaint, the defendant took nearly three months to search and identify potentially relevant documents.
• Collection efforts were left solely to employees without any supervision from management.
• No follow up was conducted with employees to identify if the preservation guidelines were being followed or if relevant documents were collected.
• Search and collection efforts were not documented or tracked."

Hence, based on the defendant's failures, monetary sanctions were imposed by the court.