In Hyles v. New York City et. al., (Case No. 10-3119, 2016 U.S. Dist. LEXIS 100390 [S.D.N.Y. Aug. 1, 2016], the plaintiff, an African-American female employed by the City of New York, was demoted.  Specifically, she was replaced by a white male and demoted to a different position with a lesser salary.  Ultimately, plaintiff sued the City for discrimination and a hostile work environment under various federal statutes.

Discovery in the case was unnecessarily protracted for a number of reasons including a temporary stay and attendant delays due to mediation, motion practice, and what the Court called, a “lack of effort by counsel.” Eventually, a discovery conference was held before Magistrate Judge Andrew Peck after counsel for both parties jointly requested the Court resolve various discovery disputes.  As is relevant to this blog, the parties requested the Judge determine the scope of electronic discovery regarding: (a) custodians, (b) the date range to be searched, and (c) search methodology to be utilized.  Regarding the issue of search methodology, the City sought to use keyword searches designed to identify potentially responsive materials.  Plaintiff, on the other hand, requested the Court compel the City to use a form of technology assisted review (“TAR”) to perform the City’s search for potentially responsive materials.  In seeking to compel the City, plaintiff asserted that TAR is the more cost effective and efficient way to obtain discovery.   The City, in opposition, argued that the cost of TAR was too much and, because the parties failed to collaborate well in the past they “would not be able to collaborate to develop the seed set for a TAR process.”

In response to the plaintiff’s argument that the use of TAR would be the most efficient and cost effective, Judge Peck agreed stating “the Court believes that for most cases today, TAR is the best and most efficient search tool,” finding it “superior” to key word searching and noting, “[t]he Court would have liked the City to use TAR in this case”.  However, citing Sedona Conference Principle 6, Judge Peck held that “the responding party is best situated to evaluate the procedures, methodologies, and technologies appropriate for preserving and producing their own [ESI].”

Judge Peck noted that someday, the law may be at the point where “it might be unreasonable for a party to decline to use TAR… [but,] [w]e are not there yet.” Hyles, supra, 2016 U.S. Dist. LEXIS 100390 . at *9-*10.  Therefore, the Court denied plaintiff’s application to force defendant to use  predictive coding.

It is interesting to note the ever-growing trend among federal judges to embrace TAR as an effective way to contain costs and engage in an efficient discovery process.  While it is true that the state of the law currently allows the responding party to determine how best to identify potentially responsive data such that the party can comply with its discovery obligations, I predict (no pun intended) that more and more parties – when faced with the potentially tremendous financial costs attendant to e-discovery – may soon turn to various TAR methodologies if only as a means to control costs.

This case (Heller’s Gas, Inc. v. Int’l Ins. Co. of Hannover Ltd., 2016 U.S. Dist. LEXIS 71069 [M.D. Pa. June 1, 2016]), arises from an insurance claim filed by Heller’s Gas Inc. (“Heller”).  Heller was issued a commercial output insurance program property insurance policy by defendants International Insurance Company of Hannover LTD and International Insurance Company of Hannover  SE (“Defendants”). Heller’s used this policy to insure property that housed six 30,000 gallon tanks filled with approximately 136,800 gallons of liquid propane. On October 11, 2013, Plaintiffs found evidence of a sinkhole beneath the tanks, which allegedly damaged the tanks. Heller removed the liquid propane from the tanks, transported the liquid propane to other facilities, disassembled the tanks, and moved the tanks to stable ground at considerable expense. Defendants denied coverage for the loss, aside from $5,000 under emergency removal expense coverage. Heller’s subsequently filed a lawsuit alleging breach of contract and statutory bad faith.

During discovery, Defendants received information from various third parties through subpoenas.  After receipt of that information, Defendants discovered that Heller failed to produce relevant and discoverable information. For example, Defendants received an email from a records custodian who admitted in the email that there was no physical damage to the propane tanks. This email was discovered, not through documents produced by Plaintiff, but from documents produced from a third party. Thus, Defendants brought a motion to compel Heller to produce more complete responses to discovery.

The Court, in granting Defendants’ motion noted that recently amended Federal Rule of Civil Procedure 26(b)(1) provides that “[p]arties may obtain discovery regarding any non-privileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case . . .” And, evidence is relevant if it has “any tendency to make a fact more or less probable than it would be without the evidence” and if it “is of consequence in determining the action.” The Court then noted that the party objecting to discovery must state the grounds for the objection with specificity and the party requesting the discovery then bears the burden to prove that the requested discovery falls within the bounds of Rule 26.  Finally, the Court noted that if this burden is met, the objecting party must then “convince the court why discovery should not be had.”

Applying these discovery principles to the motion at hand, the Court determined that Heller failed to put forth specific objections to the requested discovery.  Rather, Heller objected to the motion on the grounds that it already produced four hundred and thirty-one pages of documents at Defendants’ request and that Defendants have suffered no prejudice, as they received the disputed documents, albeit from third parties. Heller’s counsel also stated that he was “amenable to revisiting the issue with Plaintiff and issuing an appropriate discovery certification.”  Latching on to Plaintiff’s counsel’s good intentions, the Court found “the Plaintiff offers no objection to ‘revisiting the issue,’ ” and granted Defendants’ motion to compel.

The lesson here is that any discovery objections interposed must be done with specificity especially where, as in Heller, the requested discovery falls within the bounds of Rule 26.

In Sunderland v. Suffolk Cty., 2016 U.S. Dist. LEXIS 77212 (E.D.N.Y. June 14, 2016) Magistrate Judge A. Kathleen Tomlinson granted plaintiff’s motion to compel defendants to search for and produce certain documents from their personal computers.

Specifically, plaintiff – a transgender inmate incarcerated at Suffolk County Correctional Facility (“SCCF”) – brought a civil rights case against the County of Suffolk and also three individuals in both their individual and official capacities. The gist of the complaint, as against the individual defendants, was that they knew of plaintiff’s gender dysphoria but were dismissive of the condition and refused to continue plaintiff’s hormone therapy while incarcerated at SCCF.

While the parties agreed on the relevant time period and search terms for purposes of identifying relevant information, the parties disagreed as to whether the individual defendants were required to search their personal emails and computers.  The defendants argued that while their electronic work devices and accounts can be searched, their personal items are not discoverable.  Plaintiff moved to compel production of personal emails.

The court granted the plaintiff’s motion to compel, explaining that the personal documents are relevant under FRCP 26(b)(1), even after the December 2015 amendments. The court elaborated that the nature of the case made it likely that information relevant to claims of bias, deliberate indifference or state of mind, would have been kept on a personal device or account rather than a work one. In its reasoning, the court further explained that such a search is not overly burdensome because the parties already agreed to the terms to be used, the searches had a limited temporal scope, and the plaintiff insisted that the defendants’ computers would not have to undergo forensic inspection.

While this decision is important for a number of e-discovery principles, it is also a good reminder that one should limit personal devices to personal emails and, likewise refrain from using work computers/emails for personal purposes.

Federal Rule of Civil Procedure 37 (along with others — Rules 1, 16, 26 and 34) was amended, effective December 1, 2015.

The amendment to Rule 37(e) was intended, in part, to ensure practitioners/litigants were fully aware of their preservation obligations, to ensure a uniformity of sanctions imposed upon parties and practitioners who failed to preserve discoverable electronically stored information (“ESI”), and to make adequate preservation a realistic goal, requiring that only “reasonable steps” be taken to preserve information. Indeed, the amendment requires a finding of intent or bad faith before sanctions can be imposed based upon spoliated information. (*)  Now, nearly a year after the enactment, it appears, from a review of the case law, that the amendment to Rule 37 (e) is effective in achieving its intended purposes.

Not only have federal court decisions involving sanctions declined since Rule 37’s amendment but, practitioners appear to be in better compliance with their preservation obligations since the amendment.

What Do the 2016 Statistics Look Like
Forty-nine federal decisions have cited Rule 37(e) since the Rule was amended. (**) Of these 49 decisions (20 of which did not apply Rule 37), thirteen decisions granted sanctions and sixteen decisions denied sanctions and/or reserved imposing sanctions. And so, sanctions were issued by courts approximately 40% of the time. Interestingly, the nature of the sanctions imposed spanned the gamut and included financial sanctions, adverse inferences, evidence preclusion, or a combination of sanctions. However, the most common sanction issued was an adverse inference.

Indeed, of the 13 decisions that granted sanctions:

• one decision entered a default judgment,
• three decisions precluded reliance upon certain evidence,
• seven decisions imposed monetary sanctions, and
• eight decisions imposed sanctions in the form of adverse inference sanctions. (***)

NB: some decisions imposed more than one type of sanction pursuant to 37(e).

Additionally, there was a variety of “lost” ESI at issue in the various decisions. Specifically,

• Twelve decisions involved unpreserved email data,
• Four decisions involved unpreserved text messages,
• Three decisions involved unpreserved portable device data,
• Two decisions involved unpreserved videos,
• Two decisions involved unpreserved phone call recordings,
• Two decisions involved unpreserved Internet browsing history,
• One decision involved unpreserved social media,
• Twelve decisions involved unpreserved non-email business data.

While 49 federal court decisions, in less than a year, have referenced Rule 37(e), that number is far fewer than in years past. In fact, according to research sources, the number of sanction decisions in 2011 totalled 150; and in 2012 that number was 120. Thus, it would appear that sanction decisions are on the decline. Moreover, given that there are 900 sitting federal judges, one could argue that sanctions have not lightly been sought since the Federal Rules amendments.


* Although Judge Scheindlin’s Zubulake opinions (which made it explicit that parties have a duty to preserve evidence when litigation is imminent) were authored many years ago, lawyers and parties nonetheless continued to fail to preserve evidence.

** Those 49 cases are:
CAT3, LLC v. Black Lineage, Inc., 2016 WL 154116 (S.D.N.Y. 2016)
O’Berry v. Turner, 2016 WL 1700403 (M.D. Ga., Valdosta Div. 2016)
Matthew Enterprise, Inc. v. Chrysler Group LLC, 2016 WL 2957133 (N.D. Cal. 2016)
GN Netcom, Inc. v. Plantronics, Inc., 2016 WL 3792833 (D. Del. 2016)
Learning Care Group, Inc. v. Armetta, 2016 WL 4191251 (D. Conn. 2016)
Best Payphones, Inc. v. City of New York, 2016 WL 792396 (E.D.N.Y. 2016)
Nuvasive, Inc. v. Madsen Medical, Inc., 2015 WL 305096 (S.D. Cal. 2016)
Thomas v. Butkiewicus, 2016 WL 1718368 (D. Conn 2016)
Ericksen v. Kaplan Higher Education, LLC, 2016 WL 695789 (D. Md. 2016)
BMG Rights Mgmt. (US) LLC v. Cox Comms., Inc., 2016 WL 4224964 (E.D. Va., Alexandria Div., 2016)
Brown Jordan Int’l, Inc. v. Carmicle, 2016 WL 815827 (S.D. Fl. 2016)
Core Laboratories LP v. Spectrum Tracer Services, L.L.C., 2016 WL 879324 (W.D. Okl. 2016)
Internmatch, Inc. v. Nxtbigthing, LLC, 2016 WL 491483 (N.D. Cal. 2016)
Living Color Enterprises, Inc. v. New Era Aquaculture, Ltd., 2016 WL 1105297 (S.D. Fl. 2016)
Marshall v. Dentfirst, P.C., 313 F.R.D. 691 (N.D. Ga., Atl. Div.)
Marten Transport, Ltd. v. Plattform Advertising, Inc., 2016 WL 492743 (D. Kansas 2016)
Saller v. QVC, Inc., 2016 WL 4063411 (E.D. Penn. 2016)
Martinez v. City of Chicago, 2016 WL 3538823 (N.D. Ill., Eastern Div. 2016)
Fiteq Inc. v. Venture Corporation, 2016 WL 1701794 (N.D. Cal. 2016)
Accurso v. Infra-Red Services, Inc., 2016 WL 930686 (E.D. Penn 2016)
United States v. Woodley, 2016 WL 1553583 (E.D. Mich., Southern Div. 2016)
Marquette Transportation Co. Gulf Island, LLC v. Chembulk Westport M/V, 2016 WL 930946 (E.D. La. 2016)
Orchestratehr, Inc. v. Trombetta, 2016 WL 1555784 (N.D. Tex., Dallas Div. 2016)
Thurmond v. Bowman, 2016 WL 1295957 (W.D.N.Y. 2016)
Mazzei v. Money Store, 2016 WL 3902256 (2d Cir. 2016)
Brackett v. Stellar Recovery, Inc., 2016 WL 1321415 (E.D. Tenn., Knoxville 2016)
Bagley v. Yale Univ., 2016 WL 3264141 (D. Conn 2016)
Thomley v. Bennett, 2016 WL 498436 (S.D. Ga., Waycross Div., 2016)
Granados v. Traffic Bar and Restaurant, Inc., 2015 WL 9582430 (S.D.N.Y. 2015)
Dr Distributors, LLC v. 21 Century Smoking, Inc., 2016 WL 4077107 (N.D. Ill., Western Div. 2016)
Henry Schein, Inc. v. Cook, 2016 WL 3212457 (N.D. Cal. 2016)
Bruner v. American Honda Motor Co., 2016 WL 2757401 (S.D. Al., Southern Div. 2016)
In re Bridge Construction Services of Florida, Inc., 2016 WL 2755877 (S.D.N.Y. 2016)
Markey v. Lapolla Industries, Inc., 2015 WL 5027522 (E.D.N.Y. 2015) (Tomlinson, U.S.M.J.)
Dao v. Liberty Life Assurance Co. of Boston, 2016 WL 796095 (N.D. Cal. 2016)
Zbylski v. Douglas County School District, 2015 WL 9583380 (D. Colo. 2016)
Redwind v. Western Union, LLC, 2016 WL 1732871 (D. Or. 2016)
Stinson v. City of New York, 2016 WL 54684 (S.D.N.Y. 2016)
Whitesell Corp. v. Electrolux Home Products, Inc., 2016 WL 1317673 (S.D. Ga., Augusta Div. 2016)
Vay v. Huston, 2016 WL 1408116 (W.D. Penn. 2016)
Hammad v. Dynamo Stadium, LLC, 2015 WL 6965215 (S.D. Tex., Houston Div. 2015)
Official Committee of Unsecured Creditors of Exeter Holdings, Ltd. v. Haltman, 2015 WL 5027899 (E.D.N.Y. 2015) (Tomlinson, U.S.M.J.)
United States v. Woodley, 2016 WL 2731186 (E.D. Mich., Southern Div.)
Grove City Veterinary Service, LLC v. Charter Practices Inter., LLC, 2015 WL 4937393 (D. Or. 2015)
United States v. Safeco Ins. Co. of America, 2016 WL 901608 (D. Idaho 2016)
Coale v. Metro-North Railroad Co., 2016 WL 1441790 (D. Conn. 2016)
Fleming v. Escort, Inc., 2015 WL 5611576 (D. Idaho 2015)
Kissing Camels Surgery Center, LLC v. Centura Health Corp., 2016 WL 277721 (D. Colo. 2016)
McIntosh v. United States, 2016 WL 1274585 (S.D.N.Y. 2016)

*** Of the 19 cases in which sanctions were not granted, the reasons for denying sanctions varied. Indeed, courts declined to impose sanctions because the party “took reasonable steps” to preserve data; party was not harmed by the fact the ESI was missing; there was insufficient evidence of bad faith; and the missing data was “restored through other methods.”

Production of documents in their “native file format” is gaining traction in litigation.  But, what exactly is a native file? And why should I care about it?

Native format is the file structure of an electronic document as defined by the application that created that electronic document.

So, for example, if a spreadsheet was created using Microsoft Excel, then that document’s native format is its original Excel format (.xls).  Insofar as litigation is concerned, when producing documents, the producing party has to consider whether to produce a responsive document in its native format (the .xls) or to convert the document to another electronic format (i.e., PDF).   The format (i.e., native or something other) is something that should be carefully considered for a number or reasons.  First, the format in which a document is produced can affect the costs of production.  Second, the format in which a document is produced can affect the utility of the document itself.  Finally, the format in which a document is produced can affect one’s ability to redact the document (or inadvertently modify the document).

Consider a Microsoft Excel document.  First, producing the document in Excel format is less costly in that one does not need to convert the document to a .tiff or .PDF.  Similarly, the producing party does not need to expend the money (albeit minimal) in branding the native file with confidentiality legends or bates stamps.  Thus, production in a native file format can be more cost efficient.  Additionally, an Excel document can often have embedded formulas (or at least allow the end user to embed formulas to make the document more user-friendly).  These features are lost when the document is converted to another electronic format prior to production.  If the document is converted prior to production, the receiving party may be at a disadvantage should they have desired to “slice and dice” the data in the spreadsheet, for example.   Finally, what if the .xls spreadsheet needs to be redacted?  Redacting the native file can be quite difficult.  For example, a native file Excel spreadsheet may have multiple worksheets, formulas, pivot tables and macros.  Thus it can become a very complex process as each change can trigger a number of unforeseen additional changes in different parts of the worksheet.  Moreover, redacting the native file would, by definition, cause the file data and metadata of that file to be changed.  Therefore, counsel would need to track the redacted version alongside the clean version of the native file.  Quite the undertaking! Consequently, a common compromise is to produce an .xls that requires redaction in a PDF format.

There are numerous arguments for and against native file productions.  The main benefit of a native production is that the electronic evidence can be produced without degradation.  That said, it is critical to assess the potential benefits and drawbacks of a native production on a case by case basis before committing to a production format.


Recently, two separate New York courts (the First Department and the Southern District) issued decisions imposing sanctions upon litigants who failed to comply with preservation obligations.  While a summary of those decisions and hyperlinks to the full decisions follow, attorneys should take heed that it is critical to timely and properly issue litigation hold notices when litigation is reasonably anticipated.   Irrespective of whether we are practicing in State or Federal court, our obligations to preserve potentially relevant information are not to be taken lightly.

Appellate Division, First Department Upholds (and Modifies) Sanctions Imposed by Trial Court Because of Plaintiff’s Failure to Timely Issue Litigation Hold.

This decision, issued on June 28, 2016, by the Appellate Division, First Department discusses what sanctions are appropriate when a party fails to comply with its preservation obligations.  Specifically, before the First Department was an Order of the Supreme Court, New York County (Carol R. Edmead, J.), which granted defendant’s renewed motion for spoliation sanctions, and dismissed plaintiff’s complaint.  The First Department unanimously modified the trial court’s decision to dismiss the complaint and instead awarded defendant an adverse inference charge at trial as to the spoliated evidence.

The factual underpinnings of the lawsuit involve allegations of legal malpractice against defendant Herrick, Feinstein LLP (Herrick) in connection with Herrick’s representation of plaintiff in negotiating a high rise construction loan with a developer.  The loan closed on May 8, 2007.  After a series of mishaps, including permit revocations and a crane collapse at the construction site, plaintiff retained counsel in June 2008 in connection with its potential claims against Herrick.  Thus, plaintiff’s obligation to preserve evidence arose at least as early as June 2008 (i.e., when it reasonably anticipated litigation).  In May 2010 – almost two years later –plaintiff finally issued a litigation hold.  As a result of this 23 month delay, plaintiff’s record destruction policies (including recycling of backup tapes, routine deletion of emails, and erasure of hard drives/email accounts upon an employee’s departure from the firm), went unsuspended until May 2010.  Plaintiff ultimately commenced its malpractice suit in 2011.

In or about June 2014, Herrick filed a motion seeking dismissal of plaintiff’s complaint as a sanction for plaintiff’s failure to preserve evidence. The trial court found plaintiff’s failures constituted ordinary negligence, and granted Herrick’s motion only to the extent of directing that Herrick be entitled to an adverse inference at trial.  Later that summer, plaintiff produced additional documents that identified various other custodians who likely had information relevant to the lawsuit.  Plaintiff claimed that its failure to produce these materials earlier was inadvertent.  In or about January 2015, Herrick moved to renew its spoliation motion, based on the new documents, including the identification of additional custodians, much of whose electronic records had been destroyed by plaintiff, either due to its failure to timely institute a litigation hold, or deliberately.  Plaintiff cross moved for fees.   Upon renewal, the trial court dismissed the complaint, and denied plaintiff’s cross motion for attorneys’ fees and costs.  This appeal ensued.

The First Department found that the motion court properly granted defendant’s renewal motion but held the trial court’s decision to dismiss the complaint as a spoliation sanction was an abuse of discretion.

The Court noted,“[F]ailures which support a finding of gross negligence, when the duty to preserve electronic data has been triggered, include: (1) the failure to issue a written litigation hold []; (2) the failure to identify all of the key players and to ensure that their electronic and other records are preserved; and (3) the failure to cease the deletion of e-mail” (VOOM HD Holdings LLC v EchoStar Satellite, LLC, 93 AD3d 33, 45 [1st Dept 2012]).  Thus, per prior decisional law, the trial court’s determination that plaintiff’s destruction was grossly negligent was upheld.  However, the First Department found dismissal of the complaint an improper sanction.  Specifically, the Court noted dismissal is warranted only where the spoliated evidence constitutes “the sole means” by which the defendant can establish its defense (Alleva v United Parcel Serv., Inc., 112 AD3d 543, 544 [1st Dept 2013]), or where the defense was otherwise “fatally compromised” (Jackson v Whitson’s Food Corp., 130 AD3d 461, 463 [1st Dept 2015]) or defendant is rendered “prejudicially bereft” of its ability to defend as a result of the spoliation (Suazo v Linden Plaza Assoc., L.P., 102 AD3d 570, 571 [1st Dept 2013] [internal quotation marks omitted]).  Because the record before the Appellate Division demonstrated a massive document production and many key witnesses available to testify, an adverse inference charge was appropriate.

The full decision of the First Department can be accessed here:

The Southern District of New York Imposes Severe Sanctions Upon Village Due to Village’s Failing to Issue a Litigation Hold

In a separate decision from the Southern District, Judge Karas similarly imposed severe sanctions – an adverse inference and more than $40,000 in attorneys’ fees – against the Village of Ponoma for failing to timely issue a litigation hold.  That decision, and my colleagues’ blog about that decision can be read here:

For more on this topic See Facebook Posts And Text Messages Result In Monetary And Other Sanctions Being Imposed Against A Municipality 


We all know that it can be damaging to one’s case if a party to a litigation fails to preserve relevant information.  But when, exactly, does one’s duty to preserve (potentially relevant information) arise?  And what type of sanctions are federal courts imposing under the amended federal rules for preservation failures?

When Does One’s Duty to Preserve Arise?

Different jurisdictions have different rules regarding when the duty to preserve arises but the most common standard is once that party “reasonably anticipates litigation.” This standard is well established in the federal courts and is embraced in New York (see, e.g., Voom HD Holdings LLC v EchoStar Satellite, (2010 NY Slip Op 33764(U)).

And, while it can (sometimes) be difficult to pinpoint precisely when one reasonably anticipates litigation, a recent case in the Northern District of California demonstrates one party’s blatant disregard for its obligation to preserve.  Specifically, in Mathew Enter. v. Chrysler Grp. LLC (No. 13-cv-04236-BLF, 2016 U.S. Dist. LEXIS 67561 [N.D. Cal. May 23, 2016]), the plaintiff made no effort to preserve its internal or external emails after threatening the defendant with litigation.  Not only did plaintiff affirmatively change the email system it utilized for its business and did so after threatening Chrysler Group, LLC with a lawsuit, but Mathew Enterprises also failed to notify its database vendor of the litigation it threatened to file against defendant.   As a result, potentially relevant emails continued to be deleted regularly per normal business practice.  Indeed, there was no suspension of the auto-delete functionality used by Mathew Enterprises and no efforts were taken to otherwise maintain the emails.

Resulting Sanctions?

The Chrysler Group, LLC moved for sanctions against the plaintiff for the loss of these potentially relevant emails, highlighting there was no effort made to preserve and urged the court to utilize spoliation sanctions. The judge, Magistrate Judge Paul Grewal, issued FRCP 37(e) sanctions.  Specifically, he expanded the scope of evidence the Chrysler Group, LLC was allowed to bring to trial and he awarded reasonable attorney’s fees.   Moreover, Judge Grewal stated, “[Plaintiff’s] lackadaisical attitude towards document preservation took away [defendant’s] opportunity. Not only has spoliation occurred, but it also has prejudiced [defendant].”

The Mathew Enterprise case is a good reminder that preservation obligations must be taken seriously as the ramifications for failing to preserve can be significant.  It is thus critical that our clients are properly advised of the need to begin preservation efforts as soon as litigation is reasonably anticipated.  (i.e., upon receipt or transmittal of a cease and desist letter, for example).

In the well-known saga commonly referred to as “deflategate,” (NFL Mgmt. Council v. NFL Players Ass’n., 2016 WL 1619883 [2d Cir. Apr. 25, 2016]) the Second Circuit upheld the arbitrator’s decision to suspend Patriots’ quarterback, Tom Brady.  Specifically, Brady, was suspended for four games after it surfaced that he participated in deflating the footballs used in Superbowl XLIX below the regulation pounds per square inch (“PSI”).  In reaching that decision, the arbitrator considered several factors, including that Brady was uncooperative with the National Football League’s investigation insofar as he willfully destroyed his cell phone.  Perhaps not surprisingly, the arbitrator opined that the cell phone may have housed evidence (in the form of text messages or otherwise) of Brady’s involvement in deflating the footballs. In seeking to have the decision overturned, Brady argued that he had no idea that “destruction of the cell phone would even be at issue in the arbitration proceeding.” Because, however, Brady intentionally destroyed his cell phone, the arbitrator was able to infer that the cell phone did contain evidence which would be unfavorable to Brady.

The Second Circuit upheld the arbitration decision, noting that “any reasonable litigant would understand that the destruction of evidence, revealed just days before the start of arbitration proceedings, would be an important issue.”

The plain and simple message from this case – make sure to educate your clients about the importance of preserving – and refraining from any modification/destruction of – evidence that may be relevant to a litigation.  The panoply of sanctions available to the Court when one fails to abide by their preservation obligations is vast.

In Thurmond v. Bowman, 2016 WL 1295957 (W.D.N.Y. Mar. 31, 2016), a Fair Housing Act case, defendants moved for sanctions against the plaintiff alleging plaintiff deleted Facebook posts relevant to this lawsuit. The plaintiff argued that the posts were not deleted, but instead were “hidden” from public view.  Soon thereafter, plaintiff produced a printed set of most of the “missing” Facebook posts.  Three posts, however, remained missing. In denying defendants’ motion, the court found that the “missing” Facebook posts, because of their nature (photographs of the plaintiff’s children, supplied as “screen shots” by the defendants), were not relevant to the case. Moreover, the court noted the defendants failed to request the information through discovery. The court specifically noted that one’s claim that all social media posts are relevant “sweeps far too broadly” and discovery must be tailored to relevant information.  However, because the plaintiff did change privacy settings to the Facebook account in violation of a previous court order to maintain the “status quo” of social media accounts, the plaintiff was warned that further conduct in this manner could result in sanctions.

The takeaway from this decision is that social media is here to stay and can be relevant to – and thus subject to production in – a litigation.  When advising your client about preservation obligations, be certain to remind them that social media outlets (facebook, Instagram, SnapChat, Musically,….) are all potential caches for relevant information and must be preserved when litigation is reasonably anticipated.

In an insurance law class action suit pending in the Western District of Missouri (Labrier v. State Farm Fire & Cas. Co., 2016 U.S. Dist. LEXIS 61246 [W.D. Mo. May 9, 2016]), State Farm Fire & Casualty Company (“State Farm”) requested the district court vacate a Special Master’s discovery order. The plaintiff’s allegations were that State Farm depreciated much of its labor costs when calculating a home insurance claim payment. After State Farm objected to the class’s discovery requests, stating that access to its electronic claims system would violate trade secrets, the Special Master approved interrogatories, which requested information regarding an estimated 150,000 claims.  Resort to interrogatories resulted in State Farm having to utilize two separate databases for each claim. The district court rejected State Farm’s argument that to gather information in this matter is too burdensome, stating that “even if the matching must be done claim by claim, the time and cost involved does not justify preventing [the plaintiff] access to critical information.” The court denied State Farm’s motion to vacate the Special Master’s discovery order, explaining that “[a] litigant cannot keep its own system secret then refuse to gather the information itself.”

This decision reminds of us of the balance between providing a party with information necessary to the lawsuit and the burden of collecting/producing same.  Where, as here, the requested information is “critical,” the courts are less likely to sympathize with a party’s grievance that producing the same is time consuming and/or costly.  This was especially true in the Labrier case because State Farm sought to avoid allowing access to its confidential electronic claims system.  In doing so, State Farm was forced to resort to a far more time consuming and laborious process such that plaintiff was able to receive the information needed to prosecute the suit.