Still No Bright-Line Rules on Spoliation Sanctions

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An article by Keith M. Brandofino and Ian M. Goldrich posted on law.com on the LTN webpage.

This article discusses recent case law developments regarding sanctions rulings for eDiscovery violations, and failure to preserve electronically stored information (ESI).

The article states, "In 2010, federal courts in New York, Texas, and Maryland rendered well-publicized decisions on the proper factors to consider on a motion for sanctions based on spoliation of electronically stored information. Two issues predominated in each case -- culpability and prejudice. In the first decision, Pension Committee of the University of Montreal Pension Plan v. Banc of America Securities,[FOOTNOTE 1] the court in the Southern District of New York held that sufficiently culpable conduct was enough to warrant severe, even case-dispositive, sanctions irrespective of whether the innocent parties demonstrated that the loss of such ESI was prejudicial.

The subsequent decisions, Rimkus Consulting Group Inc. v. Cammarata,[FOOTNOTE 2]and, perhaps more so, Victor Stanley Inc. v. Creative Pipe Inc.,[FOOTNOTE 3] seemed to de-emphasize culpability; focusing instead on the alleged relevance of the spoliated ESI and the resulting prejudice to both the innocent party's case and the truth-finding process. Since these decisions, several federal district courts have weighed in on the proper analysis for ESI spoliation motions with differing results but some trends are emerging."  Links are provided to the referenced case law opinions, and accompanying footnotes.

The article goes on to analyze additional cases, and goes on to further state, "In an analysis of more recent spoliation decisions, one trend is evident: The federal courts favor case-by-case analyses over bright-line rules."  The authors further comment that, "The federal courts' reluctance to establish bright-line rules for complying with parties' ESI preservation obligations can be both a blessing and a curse. On the one hand, case-by-case analyses give courts flexibility to consider many factors, including culpability, prejudice, and the reasonableness of the preservation efforts in light of the nature of the case and the amount at issue. Parties generally are not subject to draconian sanctions based on the mere failure to abide by one or more arbitrary requirements. On the other hand, reasonable and defensible preservation protocols implemented in one case may be deemed insufficient in another."  The article goes on to provide some tips and advice as to how to deal with the current state of case law regarding preservation obligations.