Tagged: Case Summaries

Ignorance Isn’t Bliss: Federal Sanctions Imposed for Party’s Failure to Timely Search Its Email Server

A recent decision from the Eastern District of Pennsylvania underscores an important lesson on attorneys’ duty of competence, which requires a practical and well-rounded understanding of technology in order to execute their clients’ e-discovery obligations. Indeed, as Ondigo LLC v. intelliARMOR LLC reflects, ignorance of the various sources of e-discovery cannot shield attorneys or parties from sanctions under Federal Rules of Civil Procedure 26(g) or 37(e).

Unintentional Consequences? The District Court of Maryland Holds Evidence Failed Rule 37(e)’s “Intent to Deprive” Requirement

A recent opinion from the District Court of Maryland highlights the challenges litigants face proving intent to deprive under Rule 37(e)(2) when seeking sanctions for spoliation of electronically stored information (ESI). In Gov’t Emps. Health Ass’n v. Actelion Pharm. LTD., et al., Magistrate Judge Mark Coulson set forth the requirements to prove entitlement to remedial measures or sanctions under Rule 37(e)(1) and (2) and then applied these requirements to decide the ESI spoliation claims before the court. This blog has written extensively on what is required to trigger Rule 37(e) and resulting sanctions. In June 2017, defendant Actelion (“defendant”) was purchased by Johnson & Johnson (“J&J”). Following the acquisition, Actelion migrated its data to J&J, which managed the data of both companies. On November 19, 2018, the plaintiff filed this antitrust litigation against Actelion alleging the plaintiff was forced to pay higher prices for one of Actelion’s drugs because of the unavailability of a cheaper generic version caused by the defendant’s blocking of competition. Soon after, J&J issued a legal hold to preserve relevant information for the antitrust litigation. The defendant’s custodians included in the legal hold were determined by the defendant’s then in-house counsel (“Thompson”). Absent from the legal hold were five former defendant employees (“at-issue custodians”) with documents relevant to the antitrust litigation....

Raising the Specter of Discovery Abuse: The Importance of Developing a Discovery Record Before Filing a Motion to Compel

Two recent decisions highlight the importance of establishing a record of discovery abuse before filing a motion to compel based upon the commonly held suspicion that a responding party is withholding information and/or has failed to adequately preserve or search for information. Even in situations where a party is convinced that an adversary has failed to produce discoverable information, a litigant will face an uphill climb in pursuing a motion to compel in the absence of concrete evidence as to an adversary’s discovery shortfalls, including evidence of data deletion, untimely or absent preservation efforts, and/or the failure to produce information produced by other parties or third-parties that clearly should be in the possession of the responding party. Winn-Dixie Stores, Inc. v. Eastern Mushroom Marketing Cooperative (E.D. Pa.) In a recent decision from the Eastern District of Pennsylvania, Judge Schiller denied plaintiffs’ motion to compel in a case where plaintiffs insisted that “there simply must be responsive documents,” but plaintiffs were unable to provide any specific evidence to support their speculation. In this antitrust litigation involving allegations that defendants colluded to raise the price of fresh agarics mushrooms, plaintiffs sought all documents from defendants regarding the sale of mushrooms to plaintiffs. In particular, numerous discovery disputes ensued after the court entered an order requiring defendants to...

Disappearing Act: Northern District of California Issues Rare Terminating Sanctions for Spoliation on a Massive Scale

In WeRide Corp. v. Kun Huang, the Northern District of California addressed an egregious case of discovery abuses and spoliation by defendants in a business litigation involving the alleged theft of autonomous vehicle technology. Applying Federal Rules of Civil Procedure 37(b) and 37(e), the court issued rare terminating sanctions against several defendants who willfully and intentionally deleted various forms of ESI, including relevant emails, status reports, and source code, well after the commencement of litigation and after a preservation order issued by the court requiring the preservation of such information. Defendants compounded these abuses by adopting the use of “DingTalk,” an ephemeral communication technology, after the court had issued the preservation order. WeRide, a technology company engaged in the business of developing autonomous cars, employed defendant Jing Wang as CEO in January 2018. WeRide alleged that Wang went on to form his own company, AllRide, as a direct competitor. WeRide also alleged that former employee defendant Kun Huang was recruited by Wang to work for AllRide while still employed by WeRide. WeRide alleged that Huang downloaded various forms of data during this time period and transferred this data onto several USB devices from two WeRide-issued computers, then proceeded to delete files from the devices. WeRide further alleged that AllRide and Huang stole WeRide’s source code,...

“Private” Facebook Posts Are Discoverable and Should Be Treated as Any Other Source of Discoverable Information

The New York Court of Appeals unanimously ruled in Forman v. Henkin that “private” Facebook posts (i.e., those accessible only to your Facebook “friends,” as opposed to the general public) are discoverable if they meet the common discovery standard—that they are “material and necessary to the prosecution or defense of an action.” In Forman, plaintiff alleged she was severely injured when she fell from defendant’s horse. Plaintiff alleged her injuries impaired her ability to communicate and participate in what she described as the active lifestyle she enjoyed before the accident. Plaintiff alleged she posted on Facebook many photographs that depicted her pre-accident lifestyle, but that communicating on that social media platform had become so difficult after the accident that she deactivated the account six months later. She alleged that, after her accident, it would take hours to write a message on Facebook because she would have to re-read it several times before sending it to be sure that it made sense. Defendant requested an unlimited authorization to obtain plaintiff’s “private” Facebook account postings, arguing they would be relevant to plaintiff’s claims. The Supreme Court ordered plaintiff to produce all photographs (that were not of a romantic or sexual nature) and an authorization that would allow defendant to obtain from Facebook the frequency of plaintiff’s Facebook posts,...

Don’t Ask For Too Much: Court Strikes Balance in Addressing Dispute Over Discoverability of Social Media

In a recent case, Magistrate Judge Mark L. Carman of the United States District Court for the District of Wyoming reminds practitioners that requests for social media data still must be relevant and proportional to the dispute. In this auto accident case, the Court found a balance between the need for defendants to determine whether a plaintiff is lying or exaggerating and the possibility that allowing defendants too much leeway in seeking social media could dissuade injured plaintiffs from pursuing legitimate claims for fear of humiliation and embarrassment. Plaintiff alleged she sustained physical injuries, traumatic brain injury, posttraumatic stress disorder, anxiety, and depression. In an extraordinarily broad discovery request, defendant requested that plaintiff produce “an electronic copy of your Facebook account history.” Plaintiff downloaded and produced information from her Facebook accounts gathered by using several keyword search terms. However, plaintiff refused to produce her entire Facebook archive, and defendant moved to compel. The Court explained that “[s]ocial media presents some unique challenges to courts” in determining the proper scope of discovery. In particular, Judge Carman explained: “People have always shared thoughts and feelings, but typically not in such a permanent and easily retrievable format. No court would have allowed unlimited depositions of every friend, social acquaintance, co-employee or relative of a plaintiff to inquire as...

Signs of Life? – Judge Francis Opines that “Inherent Authority” to Sanction Spoliation Related Conduct Survives Amended Rule 37(e)

In perhaps the first published decision since the amended Federal Rules took effect on December 6, 2015, United States Magistrate Judge James C. Francis IV, a preeminent judicial e-discovery authority, relied upon amended Rule 37(e) and, somewhat controversially, his inherent authority, to sanction a litigant for evidence tampering and spoliation. The opinion is significant, not solely because it invokes the newly-minted rule, but because it interprets amended Rule 37(e) as not foreclosing the court’s inherent authority as a viable alternative to sanction spoliation-related conduct that may not strictly satisfy the new Rule’s elements.

Proportionality Carries the Day: Amended FRCP 26 Cited to Quash Overbroad Subpoenas

As practitioners are well aware, the recent amendments to the Federal Rules of Civil Procedure took effect on December 1, 2015. In one of the first applications of amended Rule 26(b)(1), Magistrate Judge James Cott in the Southern District of New York utilized it to quash several overbroad subpoenas. In Henry v. Morgan’s Hotel Group, Inc., plaintiff Phillip Henry, a gay black man, sued his former employer, defendant Morgan’s Hotel Group, for race and sexual orientation discrimination and retaliation. Henry alleged that his former supervisor routinely disparaged him with racial and homophobic remarks.

N.Y. Court Grants Spoliation Sanctions for Destruction of Documents Decades Ago

In Warren v. Amchem Products, Inc., Justice Peter Moulton sanctioned defendant J-M Manufacturing Company for destroying documents in 1990 and 1997 – 24 years and 17 years, respectively, before the Warren Estate filed suit against asbestos manufacturers in 2014. The Court granted plaintiff’s motion for spoliation sanctions and ordered that, should the case proceed to trial, the jury will be instructed that it may infer that the destroyed documents would have supported plaintiff’s claims and would not have supported J-M’s defenses.