Document Retention and Destruction in Idaho Lessons from the CourtsPresentation Transcript
DOCUMENT RETENTION AND
DESTRUCTION IN IDAHO:
Lessons from the Courts
John N. Zarian
Stoel Rives LLP
August 21, 2007
1992: You want all the documents?
2007: You want all the documents?*
Boxes vs. Bytes
Average banker’s box holds
2,500 sheets of paper
1 page of information contains,
on average, .02 megabytes
Typical PC hard disk = 1,000 boxes
Typical server hard disk = 2,000 or
more boxes of information
What do the Lawyers Want?
New information and documents that
do not otherwise exist in hard copy
93% of documents created electronically
30% or fewer actually exist in hard copy
New sources of information
E-mails, calendars, I-Ms, voice mails
Drafts, temporary files, fragments
Note: standards of practice require
that lawyers pursue e-discovery
What are the Lawyers Looking for?
Links in the
The “Smoking Gun”
The Bad Actor
Hiding the ball
Liars and Cheaters
The Silver Bullet!
What do the Lawyers do with
Documents Obtained in Discovery?
Discovery Paradigm in Litigation
1. The Duty to Preserve
The duty to reasonably preserve evidence
from loss or destruction is triggered when
an entity knows or reasonably should know
that evidence may be relevant to pending
or anticipated litigation.
Summons, complaint, or notice
Subpoena, discovery, preservation letter
Event with high potential for litigation
But generally not “simple posturing statements”
Triggering standards may vary by company
Litigation Counsel’s Duties
[C]ounsel must become fully familiar with her client's
document retention policies, as well as the client's
data retention architecture.
This will invariably involve speaking with information
technology personnel, who can explain system-wide
backup procedures and the actual (as opposed to
theoretical) implementation of the firm's recycling
It will also involve communicating with the “key
players” in the litigation, in order to understand how
they stored information.
Zubulake v. UBS Warburg LLC, 229 F.R.D. 422, 432 (S.D.N.Y. 2004)
Should be sent as soon as organization reasonably believes a
claim may be filed by or against it, the organization has an
affirmative duty to preserve relevant records, both hard copy and
electronic. The organization should impose a “litigation hold” as
its policy of preserving potentially relevant evidence.
In re NTL, Inc. Securities Litigation, 2007 U.S. Dist. LEXIS 6198
(S.D.N.Y. Jan. 30, 2007) (spoliation sanctions for destruction of
emails of 44 key employees; obligations extended to
documents company had access to through an agreement
with a successor company following bankruptcy).
“Litigation hold” itself may not be privileged. But see Gibson v.
Ford Motor Co., 2007 U.S. Dist. LEXIS (litigation hold need not be
produced because likely attorney work product).
A party has an ongoing duty to supervise (reasonably) a
litigation hold. See Zubulake V, 299 F.R.D. at 432.
Litigation Holds - tips
Integrated with IT / infrastructure
Related to existing record retention policy
Key employee should determine “trigger.”
See Consolidated Aluminum Corp. v. Alcoa,
Inc., 2006 U.S. Dist. LEXIS 66642 (M.D.
La. Jul. 19, 2006) (party should have
begun litigation hold on email once it sent a
demand letter; however, no showing of
“bad faith” so no adverse inferences).
Litigation holds –
protocols & strategy
Template: internal preservation letter to
key custodians and key players
Template: internal preservation letter to
key IT/infrastructure personnel
Template: external preservation letter,
balance between specificity and generality
Template: response to external
preservation request, citing reasonableness
of efforts and “safe harbor” provision and
requesting assistance in narrowing focus
These may all be anti-spoliation evidence
Spoliation of Evidence – Federal
Legal standards governing sanctions for spoliation of
evidence depend on the timing of the spoliation. If the
spoliation occurs before the litigation is filed, sanctions are
governed by the inherent power of the Court to make
evidentiary rulings in response to the destruction of
relevant evidence. See
Unigard Security Insurance Co. v. Lakewood,
982 F.2d 363 (9th Cir.1992); Performance Chevrolet, Inc.
v. Market Scan Systems, Inc., 2006 WL 1042359 (D. Idaho
2006). If the spoliation occurs after the case is filed, Rule
37(b)(2) of the Federal Rules of Civil Procedure governs the
A party engages in spoliation as a matter of law only if it
had some notice that the documents were potentially
relevant to litigation before they were destroyed. See
U.S. v. Kitsap Physicians Service,
314 F.3d 995, 1001 (9th Cir.2002); Akiona v. U.S.,
938 F.2d 158 (9th Cir.1991).
However, spoliation can occur even in the absence of bad
faith. See Glover v. Bic Corp ., 6 F.3d 1318 (9th Cir.1993).
The majority of courts have held that pre-litigation destruction
can constitute spoliation when litigation was “reasonably
foreseeable” – but not where it was “merely possible.”
See Killelea, Spoliation of Evidence,
70 Brooklyn L.Rev. 1045, 1050 (2005); see, e.g., Cache La
Poudre Feeds, LLC v. Land O’Lakes, Inc., 2007 U.S. Dist. LEXIS
15277 (D. Colo. Mar. 2, 2007) (demand letter inviting
negotiations to resolve trademark dispute not explicit enough
to trigger duty).
The party alleging spoliation has the burden to produce
evidence suggesting that the destroyed evidence was relevant
to its claims and would have been used at trial if not
destroyed. See Arizona v. Youngblood, 488 U.S. 51, 58 (1988).
Sanctions could include exclusion of claims, exclusion of
evidence, or a jury instruction that the jury may presume that
the destroyed evidence, if produced, would have been adverse
to the party that destroyed it. Unigard, 982 F.2d at 368-70.
Fed. R. Civ. P. 37(b)
Failure to Make or Cooperate in Discovery; Sanctions. … [T]he court in which the
action is pending may make such orders in regard to the failure as are just, and among
others the following:
(A) An order that the matters regarding which the order was made or any other designated facts
shall be taken to be established for the purposes of the action in accordance with the claim of the
party obtaining the order;
(B) An order refusing to allow the disobedient party to support or oppose designated claims or
defenses, or prohibiting that party from introducing designated matters in evidence;
(C) An order striking out pleadings or parts thereof, or staying further proceedings until the order
is obeyed, or dismissing the action or proceeding or any part thereof, or rendering a judgment by
default against the disobedient party;
(D) In lieu of any of the foregoing orders or in addition thereto, an order treating as a contempt
of court the failure to obey any orders except an order to submit to a physical or mental
(E) Where a party has failed to comply with an order under Rule 35(a) requiring that party to
produce another for examination, such orders as are listed in paragraphs (A), (B), and (C) of this
subdivision, unless the party failing to comply shows that that party is unable to produce such
person for examination.
In lieu of any of the foregoing orders or in addition thereto, the court shall require the party
failing to obey the order or the attorney advising that party or both to pay the reasonable
expenses, including attorney's fees, caused by the failure, unless the court finds that the failure
was substantially justified or that other circumstances make an award of expenses unjust.
Spoliation of Evidence – Idaho
Evidentiary significance of a party’s conduct in losing or destroying
evidence is analyzed under the evidentiary doctrine of
“spoliation of evidence.” See Courtney v. Big O Tires, Inc., 139
Idaho 821, 824, 87 P.3d 930 (2003). Similar to federal court,
however, in the context of pending litigation, courts will look to
Rule 37(b) of the Idaho Rules of Civil Procedure to determine
whether a party’s willful, intentional, and unjustifiable destruction
of evidence, which the party knows is material to pending or
reasonably foreseeable litigation, may so prejudice an opposing
party that sanctions should be imposed. See id., at 825.
The Idaho Supreme Court has articulated the evidentiary doctrine
of spoliation of evidence as follows: “The evidentiary doctrine of
spoliation recognizes it is unlikely that a party will destroy
favorable evidence. Thus, the doctrine of spoliation provides
that when a party with a duty to preserve evidence intentionally
destroys it, an inference arises that the destroyed evidence was
unfavorable to that party. Spoliation is a rule of evidence
applicable at the discretion of the trial court.” Bromley v. Garey,
132 Idaho 807, 812, 979 P.2d 1165, 1170 (1999).
The spoliation doctrine is a general principle of civil litigation
which provides that upon a showing of intentional destruction
of evidence by an opposing party, an inference arises that the
missing evidence was adverse to the party’s position. Stuart v.
State, 127 Idaho 806, 816, 907 P.2d 783, 793 (1995), see
McCormick On Evidence, § 265, pp. 189-94 (4th ed. 1992).
The spoliation doctrine is a form of admission by
conduct. Courtney, 139 Idaho at 824, citing McCormick, at
pp. 190-91 (“By resorting to wrongful devices, the party is said
to provide a basis for believing that he or she thinks the case is
weak and not to be won by fair means.”).
As an admission, the spoliation doctrine only applies to
the party connected to the loss or destruction of the
evidence. Courtney, 139 Idaho at 824.
Furthermore, the merely negligent loss or destruction of
evidence is not sufficient to invoke the spoliation doctrine. Id.,
citing McCormick at pp. 190-91 (“[T]he circumstances of the
act must manifest bad faith.”).
Whether or not conduct constitutes an admission depends
upon the party's knowledge or intent that can be
inferred from that conduct. Courtney, 139 Idaho at 824.
For the loss or destruction of evidence to constitute an
admission, the circumstances must indicate that the
evidence was lost or destroyed because the party
responsible for such loss or destruction did not want the
evidence available for use by an adverse party in pending or
reasonably foreseeable litigation. Id.
The merely “negligent” loss of evidence will not support
that inference, nor would the intentional destruction of an
item that a party had no reason to believe had any
evidentiary significance at the time it was destroyed. Id.
There may be circumstances, however, where such
inference could be drawn from the “reckless” loss or
destruction of evidence. Id.
Idaho R. Civ. P. 37(b)
Failure to comply with discovery order - Sanctions. … “[T]he court in
which the action is pending may make such orders in regard to the failure
as are just, and among others the following:
(A) An order that the matters regarding which the order was made or any other
designated facts shall be taken to be established for the purposes of the action in
accordance with the claim of the party obtaining the order;
(B) An order refusing to allow the disobedient party to support or oppose
designated claims or defenses, or prohibiting that party from introducing
designated matters in evidence;
(C) An order striking out pleadings or parts thereof, or staying further proceedings
until the order is obeyed, or dismissing the action or proceeding or any part
thereof, or rendering a judgment by default against the disobedient party;
(D) In lieu of any of the foregoing orders or in addition thereto, an order treating
as a contempt of court the failure to obey any orders except an order to submit to
a physical or mental examination;
(E) Where a party has failed to comply with an order under Rule 35(a) requiring
the party to produce another for examination, such orders as are listed in
paragraphs (A), (B), and (C) of this subdivision, unless the party failing to comply
shows that the party is unable to produce such person for examination.
In lieu of any of the foregoing orders or in addition thereto, the court shall require
the party failing to obey the order or the attorney advising the party or both to
pay the reasonable expenses, including attorney's fees, caused by the failure,
unless the court finds that the failure was substantially justified or that other
circumstances make an award of expenses unjust.
Case Study Re: Spoliation
Performance Chevrolet, Inc. v. Market Scan Systems,
Inc., 2006 WL 1042359 (D. Idaho 2006)
Case Study (continued)
Contract dispute involving hardware and data subscription.
Market Scan filed motion for sanctions for spoliation, based
on deletion of software by employee without authorization.
Owner had previously reprimanded employee for taking and
using computers, and directed him not to do so.
Nevertheless, employee apparently took the computer at
issue and installed a new operating system so that it could
be used for training purposes. This had the effect of
deleting the files which would be relevant. Employee did
this without the knowledge of, or permission from,
company’s owner – 14 months before law suit was filed.
Litigation against Market Scan at that point was remotely
possible but certainly not “reasonably foreseeable.”
Case study (continued)
Even if Market Scan had the computer back in 2002, Court
found, the evidence indicated that it would have donated it
to a high school and wiped the hard drive clean.
Importantly, Market Scan did not request to examine the
computer and software until month before trial, weakening
case the evidence was absolutely essential to its defense.
Performance filed a cross-motion, claiming Market Scan
destroyed certain logs that would have shown update
attempts and their success rate.
Court found that Performance knew long ago logs were not
available, and yet waited until just a few days before trial to
file a motion. Performance's counsel “candidly conceded”
that he filed motion in response to Market Scan's motion.
Court found no clear evidence of intentional destruction.
Since cross-motion was really a “me-too” motion, and Court
denied original motion, Court denied cross-motion as well.
Note: Conduct of employess
Is duty placed on all employees? See Zubulake v.
UBS Warburg, LLC, 2004 U.S. Dist. LEXIS 13574
(S.D.N.Y. July 20, 2004) (sanctions for willful conduct
of certain employees in deleting emails from active
accounts, not because backup tapes were recycled)
Distinction relevant to “safe harbor”?
In other key cases, conduct involved counsel or key
executives. See, e.g., Keir v. Unum Provident, 2003
U.S. Dist. LEXIS 14522 (S.D.N.Y. Aug. 22, 2003)
(director of enterprise security architecture); Danis v.
USN Communications, 200 U.S. Dist. LEXIS 16900
(N.D. Ill. Oct. 23, 2000) (chief executive officer).
Degree of diligence still likely to vary in each case,
and for different employees, depending on the facts
Courts will require “reasonable efforts.” See Fed.
R. Civ. P. 37(f)(1); Nutrition Mgmt. v. Harborside
Healthcare Corp., 2004 WL 887401 (E.D. Pa. Mar. 19,
2004) (no sanctions despite routine deletion of
emails); McPeek v. Ashcroft, 202 F.R.D. 31 (D. D.C.
2001) (no controlling authority for proposition that
restoring all backup tapes is necessary in every case).
Still need some “culpable conduct”
Evidence must be relevant
Still must show evidence would have been used
Bottom Line: you need good facts on your side!
Fed. R. Civ. P. 37(f) provides that, absent exceptional circumstances, the
court may not impose sanctions when ESI has been lost as a result of
“routine, good faith operation of an electronic system.”
This can be established by reference to a written records retention policy
But policy may not be used to destroy relevant evidence. Compare
Samsung Electronics Co., Ltd. v. Rambus, Inc., 2006 U.S. Dist LEXIS 50007
(E.D. Va. Jul. 18, 2006 (document “retention” policy targeting discoverable
documents for destruction was spoliation) with Hynix Semiconductor, Inc. v.
Rambus, Inc., 2006 U.S. Dist. LEXIS 30690 (N.D. Cal. Jan. 5, 2006) (annual
“shred days” and pizza parties, actually no spoliation).
Duty to Preserve –
Some Best Practices
Advise employees routinely
Include material in Code of Conduct
Get confirmations on litigation holds
Consider developing key expertise
(don’t just rely on overworked employees)
Internal teams / review panels
2. The Duty to Disclose
Rule 26(a)(1)- Initial Disclosures. “[A] party must, without
awaiting a discovery request, provide to other parties … a copy of,
or a description by category and location of, all documents,
electronically stored information, and tangible things that are
in the possession, custody, or control of the party and that the
disclosing party may use to support its claims or defenses,
unless solely for impeachment.”
Rule 34(a)&(b)- Request for Production. “Any party may serve
on any other party a request  to produce and permit the party
making the request, or someone acting on the requestor’s behalf,
to inspect, copy, test, or sample any designated documents or
electronically stored information … The response shall state, with
respect to each item or category, that inspection and related
activities will be permitted as requested, unless the request is
objected to, including an objection to the requested form or
forms for producing electronically stored information,
stating the reasons for the objection.”
Rule 37- Failure to Make or Cooperate in Discovery, Sanctions.
Discovery Scope and Limits
A party need not provide discovery of electronically
stored information from sources that the party
identifies as not reasonably accessible because of
undue burden or cost.
On motion to compel discovery or for a protective order,
the party from whom discovery is sought must show
that the information is not reasonably accessible
because of undue burden or cost.
If that showing is made, the court may nonetheless
order discovery from such sources if the requesting
party shows good cause, considering the limitations
of Rule 26(b)(2)(C).
The court may specify conditions for the discovery.
Fed. R. Civ. P., Rule 26(b)(2)
Duty to Disclose vs.
Duty to Preserve
“A party’s identification of sources of
electronically stored information as
not reasonably accessible does not
relieve the party of its common-law
or statutory duties to preserve
Committee Notes, Rule 26(b)(2)
Not Reasonably Accessible
“A party need not provide discovery of
electronically stored information from
sources that the party identifies as
not reasonably accessible because
of undue burden or cost.”
Not Reasonably Accessible
“The responding party must also identify, by
category or type, the sources containing
potentially responsive information that it is
neither searching or producing.
“evaluate the burdens and costs of providing
the discovery and the likelihood of finding
Committee Notes, Rule 26(b)(2)
Not Reasonably Accessible
Disaster recovery backup tapes
“Burden and expense” data
3. Collection &
There are limits to the scope of ediscovery. See Miller v. Holzmann (Miller
III), 2007 U.S. Dist. LEXIS 4399 (D.D.C.
Jan. 23, 2007) (government subpoenas for
all documents, including electronically
stored versions, in the possession of
defendant’s experts were the “very zenith
of an oppressive burden”)
Potential for cost sharing / shifting
Address Scope of Discovery
Issues Early in the Litigation
Rule 26(f) Discovery Planning Conference
Not reasonably available
Timing of disclosures
Collection & Production
Types of records
Other persons with relevant records
collection of data
Staging ESI for Production
Use of vendors
Search term sampling
Form of production
Litigation technology software
Form of Production
Smith v. Clark, 2006 U.S. Dist. LEXIS 38804
(S.D. Ga. Jun. 12, 2006) (defendants in
construction defect case ordered to produce an
exact copy of the computer disc of the actual
Quickbooks program, plaintiffs claimed printout
did not contain all available information).
Ameriwood Industries, Inc. v. Liberman, 2006
U.S. Dist. LEXIS 93380 (E.D. Mo. Dec. 27,
2006) (defendants did not produce email later
produced by nonparty, ordered to produce
mirror images of hard drives of business and
personal computers – court weighed factors for
producing info. “not reasonably accessible”).
EEOC v. Lexus Serramonte, 2006 U.S. Dist.
LEXIS 58916 (N.D. Cal. Aug. 9, 2006)
(defendant had to produce information about
female employees for a 2-year period, but
not as a database file in Quatro Pro readable
format, unless already maintained that way).
CP Solutions PTE, Ltd. v. General Electric Co.,
2006 U.S. Dist. LEXIS 27053 (D. Conn. Feb.
6, 2006) (defendants who produced over
300,000 records in TIFF format not required
to reproduce in PST; however, ordered to
provide information and software to allow
email to be matched to attachments).
Kentucky Speedway, LLC v. NASCAR, Inc., 2006 U.S.
Dist. LEXIS 92028 (E.D. Ky. Dec. 18, 2006) (citing
emerging presumption against production of
metadata, declining to order further production of
metadata for documents previously produced).
Nova Measuring Instruments Ltd v. Nanometrics, Inc.,
2006 U.S. Dist. LEXIS 49156 (N.D. Cal. Mar. 3, 2006)
(manufacturer in patent litigation ordered to produce
documents in native file format with meta data).
Williams v. Sprint/United Mgmt. Co., 2005 U.S. Dist.
LEXIS 21966 (D. Kan. Sept. 29, 2005) (party should
not have electronically “scrubbed” meta data off
spreadsheets) (party could have timely objected).
Metadata and Ethics
Last year, the ABA Standing Committee on Ethics and
Professional Responsibility issued an ethics opinion finding
that, under Model Rule 4.4(b), a lawyer receiving privileged
or confidential materials need do nothing more than provide
prompt notice of “inadvertently sent” documents.
If the receipt is not the result of the sender’s inadvertence
(e.g., disgruntled employee), notice is not required at all.
Also, lawyers who receive electronic documents are free to
look for and use information hidden in metadata even
if the documents were provided by an opposing lawyer
Fed. R. Civ. P. 26(b)(5)(B), however, restricts a receiving
party’s ability to use or disclose information “produced in
discovery that is subject to a claim of privilege or protection
as [work product]” – regardless of whether its original
production was inadvertent – until a court resolves any
disputed privilege claims.
Experts and Witnesses*
Cenveo Corp. v. Slater, 2007 U.S. Dist. LEXIS 8281
(E.D. Pa. Jan. 31, 2007) (after weighing factors, plaintiff
granted permission to appoint expert to image and
examine drives, despite defendants’ desire to control
its own computer hard drives, because issue was alleged
misuse of confidential information and computers).
Thielen v. Buongiornio USA, Inc., 2007 U.S. Dist. LEXIS
8998 (W.D. Mich. Feb. 8, 2007) (because unrestricted
access provided by mirror image would be undue
burden, court allowed only a forensic expert to
Sony BMG Music Entertainment v. Arellanes, 2006 U.S.
Dist. LEXIS 78399 (E.D. Texas Oct. 27, 2006) (to
protect privacy, court ordered appointment of a neutral
computer forensics expert to inspect and copy of
Heartland Surgical Specialty Hospital, LLC v.
Midwest Division, Inc., 2007 U.S. Dist. LEXIS
26552 (D. Kans. Apr. 9, 2007) (CEO produced
by plaintiff was not adequately prepared
under Rule 30(b)(6) to testify about
production of data).
Rule 26(b)(5)(A)&(B) provides that if a party
produces ESI that is subject to a claim of privilege
or protection, it must notify the receiving party of
the claim and the basis for it. After the notification,
the receiving party must promptly return,
sequester, or destroy the ESI and may not disclose
it until the claim is resolved. If the receiving party
has disclosed the ESI, it must take reasonable
steps to retrieve it. The receiving party may
present the ESI to the court, under seal, for
resolution of the claim. The ESI must be preserved
by the producing party until the claim is resolved.
Inadvertent Production of
Notice to receiving party
Duty to return, sequester, or destroy
Court may review
Agreements – “Quick Peek” and “Clawback”
Committee Notes Rule 26(b)(5), Rule 26(f)
Keys to Effective e-Discovery
Preservation Disclosure Collection
Develop a compliant record retention program
Adopt/implement appropriate e-discovery protocols
Designate response team and/or key personnel