DON’T GET

SANCTIONED
Like These Parties!
INTERPRETING RECENT CASE
LAW TO ENSURE E-DISCOVERY
DEFENSIBILITY
 TABLE OF CONTENTS

Table of Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

The Basics of E-Discovery Sanctions. . . . . . . . . . . . . . . 4

Rule 37 (e) Flowchart . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Case Law Alerts: Sanctions Motions Granted . . . . . . . 6

Case Law Alerts: Sanctions Motions Denied . . . . . . . . 11

Key Takeaways. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

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 LEGAL HOLDS MATTER!

With e-discovery practices maturing, and more than six years removed from the
last changes to the Federal Rules of Civil Procedure (FRCP), it seems some of us
are ready for a refresher in the fundamentals. A few years ago, we were hearing
about seeing fewer e-discovery sanctions from the bench. Fast forward to 2022,
and it seems not everyone got the memo.

E-Discovery sanctions are still an important tool for judges, as ten recent cases
demonstrate. This white paper from Exterro’s E-Discovery Case Law Project
covers five cases where judges granted e-discovery sanction motions and five
cases where one of the parties narrowly escaped sanctions. To help ensure you
stay on the right side of e-discovery sanctions, we’ve also included an FRCP Rule
37 (e) Flowchart and some advice in the form of actionable key takeaways.

The bedrock underlying all these cases, of course, is the concept that parties
to a potential lawsuit have an obligation to preserve relevant documents and
electronically stored information (ESI) as soon as they have “a reasonable
anticipation of litigation.” That means organizations must have defensible legal
hold and preservation processes in place. Without the ability to ensure you’re
preserving responsive data, you’re running the risk of e-discovery sanctions.

3 Case Law Spoliation Sanctions © 2022 Exterro, Inc. // exterro.com

 THE BASICS OF E-DISCOVERY SANCTIONS

FRCP 37 (e) explains what happens when parties allow the spoliation of ESI.

“If [ESI] that should have been preserved in the anticipation

or conduct of litigation is lost because a party failed to
take reasonable steps to preserve it, and it cannot be
restored or replaced through additional discovery, the
court: (1) upon finding prejudice to another party from loss
of the information, may order measures no greater than
necessary to cure the prejudice; or (2) only upon finding
that the party acted with the intent to deprive another
party of the information’s use in the litigation may: (A)
presume that the lost information was unfavorable to the
party; (B) instruct the jury that it may or must presume the
information was unfavorable to the party; or (C) dismiss the
action or enter a default judgment.”
A determination of the intent to deprive is the baseline of behavior that most
judges require before issuing sanctions—although courts do have the option of
levying sanctions based on their inherent authority.

Trends in sanctions include:

• Plaintiffs file more motions for sanctions than defendants.

• Most motions for sanctions are denied.

• Technology trends like ephemeral communication apps require attorneys to

stay up to date!

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 DO ESI SPOLIATION SANCTIONS UNDER FRCP 37 (E) APPLY?

Use this handy flowchart to determine what actions the court may take regarding
the spoliation of ESI?

RULE 37(e)(1)
THE COURT MAY…
Order measures no greater than necessary
to cure the prejudice.

Has ESI been “lost”? NO

YES
YES
NO Was a party prejudiced by the loss?

Should the “lost” ESI

been preserved?
NO
NO
YES
Was there specific intent to deprive?

Did the party fail to take YES

reasonable steps? NO

YES

Can the “lost” ESI be
restored or replaced? NO
YES
Restore or replace
the “lost” ESI and produce
RULE 37(e)(2)
THE COURT MAY…
A) Presume the information loss was unfavorable;
B) Issue mandatory or permissive adverse
inference instruction; or
C) Enter dismissal or default

SANCTIONS
DO NOT
APPLY!

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CASE LAW ALERTS:
Sanctions Motions Granted
Don’t Destroy Evidence!
WHY THIS CASE IS IMPORTANT
Destroying evidence can have tremendous and devastating consequences for the party at
fault. As this case shows, given the severity of the spoliation of data, courts will award harsh
judgments like permanent injunctions and terminating sanctions.
Overview
In this copyright infringement case, the U.S. 4th Circuit
Court of Appeals was asked to review a district court
judgement which sanctioned the defendants with a
permanent injunction for data spoliation.
The plaintiffs contended that the defendants stole
source code from the plaintiffs. After the plaintiffs sent
a cease and desist letter, the defendants destroyed
his computer that retained relevant information about
the case. When the plaintiffs requested information
regarding the source code, the defendants initially
contended that they had no relevant information.
Subsequently the defendants admitted during a
deposition that his computer had been destroyed.
By the end of discovery, the plaintiffs had found
that they deleted “thousands” of potentially relevant
files just before the plaintiffs forensically imaged
defendant’s data sources.
The court sanctioned the defendants for spoliation
and imposed a permanent injunction. The defendants
appealed the ruling.
Ruling
• Court Affirms Ruling.
The 4th Circuit Court of Appeals affirmed the
District Court ruling and found that a permanent
injunction was the correct ruling.
6 Case Law Spoliation Sanctions
APPEALS COURT AFFIRMS
PERMANENT INJUNCTION
FOR ESI SPOLIATION
CASE ENTRY
QueTel Corp v. Hisham Abbas
(4th Cir. July 16, 2020)
DOWNLOAD THIS CASE
• Notice.
The defendants had notice, via the cease
and desist letter that there was a reasonably
anticipated likelihood of litigation. This action
should’ve triggered the defendants’ duty to
preserve all potentially relevant information,
which they didn’t.
• Severity of the Ruling.
To justify the severe punishment of a permanent
injunction the court stated, “No less drastic
sanction would adequately address the prejudice
suffered by QueTel (plaintiffs) or adequately deter
the type of spoliation that occurred in the case.
EXPERT ANALYSIS
By Hon. Andrew Peck (Ret.), Sr. Counsel, DLA Piper
It is interesting that the Court of
Appeals did not cite Rule 37(e)
at all, because this clearly was a
case where there was intent to
deprive under 37(e)(2). Destroying
the computer (and hence the ESI
contained in it), not disclosing that
in response to an interrogatory, and also deleting
defendant’s source code control system and lying
about that—easy. Ask for case ending sanctions.
When the spoliator is the plaintiff, dismissing the
case is appropriate; here, where the defendant was
the intentional spoliator, a permanent injunction was
the correct remedy.
**Cite for expert perspective: 2020 US Dist. Lexis 22124
© 2022 Exterro, Inc. // exterro.com
CASE LAW ALERTS:
Sanctions Motions Granted SPOLIATION SANCTIONS
Don’t Destroy Encryption Keys Either! ISSUED IN INTERNATIONAL
BRIBERY CASE
CASE ENTRY
Doubleline Capital, LLP v.
Odebrecht Finance
(S.D.N.Y. March 30, 2021)

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WHY THIS CASE IS IMPORTANT

As more information is stored digitally in locations undisclosed to the public and used for
nefarious means, legal teams must grapple with how to ensure information stored in these
areas is preserved. This case is a prime example of how leveraging encryption technology can
add an additional layer of complexity to the e-discovery process.

Overview • Timing of Spoliation Motion.

The court was confused as to why the plaintiffs
brought this sanctions motion so early in
In this securities fraud lawsuit, the plaintiffs sought a
discovery without a full record of what evidence
mandatory adverse inference based on the claim that
was available to them.
the defendants destroyed encryption keys needed to
access “an internal, ‘shadow’ accounting system used to • No Intent to Deprive.
track illicit bribe payments.” To warrant a mandatory adverse inference the
court must find that the spoliating party acted
The defendants admitted to destroying the encryption
with an intent to deprive. Here, the court said,
keys. The plaintiffs argues that the encryption keys
“Plaintiffs have not shown, and cannot show, that
held access to “crucial evidence regarding the scope
defendants destroyed the physical encryption
and nature” of the lawsuit.
keys with the intent of depriving plaintiffs in this
In response to the motion, the defendants thought it litigation of that evidence.”
was too early in discovery for the court to determine if
sanctions were necessary. The defendants argue that
spoliation sanctions would be “inappropriate because
plaintiffs have not (and cannot) demonstrate that the EXPERT ANALYSIS
lost information cannot be replaced By Mike Hamilton, J.D.
in discovery.”
Director of Marketing, Exterro

Ruling As more cases deal with

encrypted data and a variety of
security mechanisms to access
• Spoliation Sanction Granted in Part.
data, the court must grapple
The court ruled that the plaintiffs could present
with how to deter spoliation
evidence around the intentional destruction of
even if more severe spoliation
the encryption keys and the jury may consider
sanctions like case dismissals
that evidence when making its decision. But the
and mandatory adverse inference jury instructions
court would not require the jury to an adverse
aren’t warranted under FRCP 37(e). Courts may look
inference based on the spoliation.
to leverage their inherent authority when FRCP
37(e) may not apply.

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CASE LAW ALERTS:
Sanctions Motions Granted
Don’t Delete ESI after
a Legal Hold Is Issued!
WHY THIS CASE IS IMPORTANT
With the large amount of data stored throughout an organization, it’s imperative that legal
teams effectively communicate what and who needs to preserve data and ensure document
retention policies are updated accordingly to ensure relevant data is kept. In this case, the
defendant didn’t have these communication plans created and it led to spoliation.
Overview
In this class-action employment case, the plaintiffs
motioned for spoliation sanctions and default
judgement based on the defendant’s alleged intentional
destruction of relevant information.
After the complaint was filed in April 2017, the
defendant sent a legal hold notice to preserve emails
and other documents relating to the case. Five days
after this, the defendant deleted backup tapes created
July 2015 through February 2016, which contained
data that was relevant to this case.
According to the district judge: “Defendant’s
unwillingness or inability to describe its efforts to
preserve, search for, and produce electronically-stored
information gave rise to a concern that defendant had
deleted the email and calendar accounts of putative
class members long after it was put on notice of a
potential wage and hour claim.”
As a result, the plaintiff motioned for sanctions.
Ruling
• Spoliation Occurred.
The court ruled that “discoverable ESI existed
at the time the duties to preserve the evidence
arose, that defendant’s efforts to preserve the
ESI were deficient, that defendant took
affirmative and intentional steps to destroy
relevant evidence that it knew or should have
known had not been preserved, and that the
evidence is now irretrievably lost. Thus, plaintiffs
have shown that spoliation occurred.”
8 Case Law Spoliation Sanctions
MISCOMMUNICATION
ABOUT DOCUMENT
RETENTION POLICIES
LEADS TO SPOLIATION
CASE ENTRY
Bolding v. Banner Bank
(W.D. Wash. May 22, 2020)
DOWNLOAD THIS CASE
• Duty to Preserve.
The defendant argued that the duty to preserve
hadn’t triggered when the defendant destroyed
“email accounts and work-related calendars”
because the duty to preserve “arose over time.”
The court found this argument “extraordinary”
and unfounded.
• No Default Judgment.
Based on a large amount of data available to the
plaintiffs’ to make their case (e.g. “seven to eleven
months of pre-filing emails and calendars”), the
ability for the court to mitigate damages caused
by the spoliation weighed heavily in the court not
granting the plaintiffs’ default judgment motion.
EXPERT ANALYSIS
By Hon. Andrew Peck (Ret.), Sr. Counsel, DLA Piper
This case is another example of
the problems that can arise when
counsel and the IT department are
not sufficiently coordinated. It also
demonstrates the importance of
contemporaneous notes as to what
was done to preserve and why
those decisions were made. Finally, it is curious that
the Court nowhere mentions Rule 37(e). The court
reached the correct conclusion not to enter a default,
but Rule 37(e)(2) reserves default judgments or serious
sanctions for when there is an “intent to deprive”
which was absent here.
© 2022 Exterro, Inc. // exterro.com
CASE LAW ALERTS:
Sanctions Motions Granted
Don’t Try to Avoid the
Obligation to Preserve!
WHY THIS CASE IS IMPORTANT
As bad actors become more savvy regarding how they hide their communications,
it’s imperative that legal teams thoroughly investigate whether relevant communications
existed and then prove its existence to successfully win a spoliation claim. In this case,
the moving party used corroborating testimony.
Overview
In this antitrust case around anti-competitive agreements
with companies in the pharmaceutical market, the
plaintiffs sought spoliation sanctions based the defendant
deleted relevant text messages on two mobile phones.
The defendant received notice of litigation in the fall of
2015. The two mobile phones at issue: (1) Company issued
phone, (2) Contraband phone.
1. Company Issued Phone: After a key custodian
from the defendant left the company he took his
company issued phone with him. Subsequently
the key custodian was incarcerated and the key
custodian’s family took possession of the phone.
When the phone was forensically imaged, the
phone showed that it was wiped of all data around
2016 to 2017. No messages were produced in
discovery from the phone.
2. Contraband Phone: While incarcerated an
executive from the defendant, testified that he
talked to the key custodian about business dealings
via What’sApp in 2018. The key custodian invoked
his Fifth Amendment right when asked if he had a
cell phone in prison.
Based on these events, the plaintiffs filed for spoliation
sanctions, specifically an adverse inference about the
key custodian’s role in the case.
Ruling
• Motion for Spoliation Sanctions Granted.
The court ordered that the proposed sanction
precluding the defendant “from introducing any
9 Case Law Spoliation Sanctions
DELETED TEXT MESSAGES
LEAD TO SPOLIATION
SANCTIONS
CASE ENTRY
Federal Trade Commission v. Vyera
Pharmaceuticals, LLC
(S.D.N.Y. June 1, 2021)
DOWNLOAD THIS CASE
argument or evidence contrary to the presumption
that he communicated” with the defendant’s
executives regarding business matters.
• Spoliation Sanction Applies Only to
Contraband Phone.
Through testimony the plaintiffs proved that the
key custodian discussed business affairs on the
contraband phone and knew that communications
would not be preserved in What’sApp. Based on this
the key custodian’s use of this phone “constitutes
intentional spoliation and warrants sanctions.”
• No Proof of Spoliation on Company
Issued Phone.
Plaintiffs never presented evidence that the
defendant failed to preserve relevant messages
from the company issued phone. To the contrary
the defendant presented evidence that the key
custodian didn’t use the phone for company
business and there was no standard operating
procedure for backing up a company phone.
EXPERT ANALYSIS
By Hon. Andrew Peck (Ret.), Sr. Counsel, DLA Piper
An important take away is that
no sanctions were imposed for
the company issued phone which
automatically backs up to the
company’s survey. “No party has
suggested that the back up would
not include text messages.” I am not
sure that that would be true for all device management
systems, but to the extent that can be done, it will make
preservation and production in discovery so much easier.
© 2022 Exterro, Inc. // exterro.com
CASE LAW ALERTS:
Sanctions Motions Granted
Don’t Perjure Yourself!
WHY THIS CASE IS IMPORTANT
If the court finds a party took intentional steps to spoliate data and lied to the court numerous
times about how the spoliation occurred, then the court won’t be afraid to issue case dispositive
sanctions.
Overview
In this racial discrimination case, the defendant, ACE,
the plaintiff’s former employer, motioned for spoliation
sanctions against the plaintiff for intentionally
destroying potentially relevant data.
The defendant contends that the plaintiff installed a
“new operating system” on his employer’s issued laptop
with the intent to destroy responsive data. As a result,
the defendant no longer could recover potentially
responsive data from the plaintiff’s laptop.
On the other side, the plaintiff denies the defendant’s
assertion because “he (the plaintiff) kept a second
ACE-issued laptop at ACE’s Indianapolis office, and
theorizing that ACE used that laptop—or a combination
of his two laptops—to fabricate evidence of the alleged
spoliation.”
Ruling
• Case Dismissed.
The court ruled that the plaintiff destroyed files
on his company issued laptop by “installing a
new operating system and committed perjury
in denying that he had done so, and therefore
grants ACE’s sanctions motion,” and dismisses the
plaintiff’s claims.
• Perjury by the Plaintiff.
The court noted that the defendant committed
perjury and generated “a smokescreen of
conspiracy theories to distract from the truth.”
The truth the court ruled was that the plaintiff
intentionally destroyed relevant data because
10 Case Law Spoliation Sanctions
INTENTIONAL SPOLIATION
+ PERJURY = CASE
DISMISSAL
CASE ENTRY
Williams v. American College
of Education
(E.D. Ill. September 16, 2019)
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“nothing in the record suggests that reinstalling
the operating system…would have served any
purpose other than destroying evidence.”
• Continued Deception Led to Case Dismissal.
Because of the plaintiff’s deceptive behavior,
the defendant took on extensive resources to
dispute the plaintiff’s claims. In totality, the court
ruled that case dismissal was warranted because
it empowered the court to “remedy prejudice” to
the defendant and “reprimand” the plaintiff, while
“deter[ing] future parties from trampling upon the
integrity of the court.”
EXPERT ANALYSIS
By Hon. Andrew Peck (Ret.), Sr. Counsel, DLA Piper
The Court correctly sanctioned the
plaintiff, under the belt and suspenders
approach that dismissal was warranted
under Rule 37(e)(2) because plaintiff
reinstalled the laptop’s operating
system (deleting all the information
on the laptop) with the intent to
deprive defendant of the information,
and separately under the Court’s inherent power as
punishment for lying to the court. While the Advisory
Committee notes to Rule 37(e) instruct that the court
should not use inherent power for conduct covered by
the rule itself, here, it was the subsequent perjury that
justified use of the Court’s inherent power. It is never a
good idea to lie to the court.
© 2022 Exterro, Inc. // exterro.com
CASE LAW ALERTS:
Sanctions Motions Denied
Alternative Data Source Found
WHY THIS CASE IS IMPORTANT
This case reiterates the fact that the burden to succeed on spoliation sanctions under FRCP 37(e) is very high. Courts
will refer to the business judgment rule if the party accused of spoliating evidence did not act with any bad intent and
if the requesting party was not prejudiced. Here the court found that sanctions were not warranted because the data
deletion resulted from ordinary and reasonable business processes, any deletion of responsive data was inadvertent,
and the deleted data was replaced with other data providing similar information.
Overview
In this patent infringement case, the plaintiffs moved
for spoliation sanctions, arguing that the defendant
engaged in “intentionally and continuously” destroying
evidence related to their case “for at least six years
after this case was filed.”
The data in question was contained in the defendant’s
“seeder and tracker logs,” which were routinely deleted
in accordance with the defendant’s retention policies.
This information, the plaintiff contended, documented
the amount of revenue the defendant generated from
the alleged patent infringement.
The defendant did not contest that (1) this data should
have been preserved, (2) the data was lost and (3)
the data was lost because the defendant did not take
reasonable steps to preserve it. But the defendant
argued that it produced other evidence to the plaintiff,
which replaced the lost evidence.
Ruling
• Motion for Spoliation Sanctions Denied.
The court ruled that the defendant replaced the
deleted information and therefore sanctions
under Rule 37(e) were not warranted.
11 Case Law Spoliation Sanctions
AMAZON AVOIDS
E-DISCOVERY SPOLIATION
SANCTIONS BY PRODUCING
ALTERNATIVE DATA
CASE ENTRY
Via Vadis, LLC v. Amazon, Inc.
(W.D. Tex. July 23, 2021)
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• The court also went onto state, “Because Amazon
has established that it has replaced the relevant
information, and that the server logs were lost
without Amazon’s “intent to deprive [Plaintiffs] of
the information’s use in the litigation” under Rule
37(e), Plaintiffs’ motion for spoliation sanctions is
denied.”
• The defendant did not contest that (1) this data
should have been preserved, (2) the data was lost
and (3) the data was lost because the defendant
did not take reasonable steps to preserve it. But
the defendant argued that it produced other
evidence to the plaintiff, which replaced the lost
evidence.
EXPERT ANALYSIS
By David Cohen, Esq. Partner and Chair of Records
and E-Discovery Group, Reed Smith LLP
This opinion highlights the
significance of the 2015
amendments to FRCP 37(e),
particularly what has since been
referred to as the “no harm-no foul”
revision: if electronic evidence is
lost inadvertently, and that loss
causes no prejudice to the requesting party, sanctions
will not be granted. This revision to Rule 37(e) limits
the use of sanctions motions for tactical purposes,
but the defendant here was fortunate to find another
source for the inadvertently deleted information.
© 2022 Exterro, Inc. // exterro.com
CASE LAW ALERTS:
Sanctions Motions Denied “BLANKET ACCUSATIONS”
Blanket Accusation DON’T WARRANT
Aren’t Enough SPOLIATION SANCTIONS
CASE ENTRY
Novit v. Metropolitan School District of
Warren Township
(S.D. Ind. August 24, 2021)

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WHY THIS CASE IS IMPORTANT

To win your case you must have evidence to sway a jury. The same principle applies to winning
spoliation motions. You MUST have evidence to prove that a party acted intentionally to delete
relevant data. Without it, the judge will not rule in your favor.

Overview • “Blanket Accusation.”

There must be evidence to prove that data
was spoliated intentionally. In this case, the
In this tort case involving a child who suffered injuries
judge saw “no evidence to support Plaintiffs’
on a school bus, the plaintiff motioned for spoliation
blanket accusation of spoliation. Such a blanket,
sanctions, specifically a default judgment, because the
unsupported accusation falls way short of the
defendant deleted video footage of the accident.
requirement for a spoliation sanction to be
At the beginning of discovery, the plaintiff requested considered under [FRCP] 37(e).”
video of the accident, which the defendant produced.
• Interesting Last Word.
A year and a half later the plaintiff wanted additional
The judge wanted to make clear that spoliation
footage from the accident beyond that which they
is denied without prejudice, noting that “without
initially requested. “Defendant informed Plaintiffs that
prejudice” does not equate to “an invitation to
it did not have any additional video from the date of
renew their motion.”
the incident and that the bus hard drive had since been
either looped over, wiped clean, or destroyed and used
for parts.”
EXPERT ANALYSIS
The plaintiff argued that the hard drive was By Hon. Andrew Peck (Ret.), Sr. Counsel, DLA Piper
intentionally or negligently deleted, leading the plaintiff
to request the court order a default judgment or an To prove “intent to deprive” under
adverse jury instruction. FRCP 37(e)(2), one needs evidence
(even circumstantial). The mere
failure to have preserved ESI does
Ruling not prove intent to deprive, as it
would be circular. Several recent
• Sanctions Denied.
decisions where a party moves
The court ruled that the defendant acted
to compel on the grounds that there must be more
reasonably during discovery, preserving the
ESI, but has no evidence to support that claim, have
requested video footage and then placing the
resulted in the motion’s denial. Finally, I love the
hard drive back into operation. Therefore,
Court’s last line here that the without prejudice denial
the court dismissed the plaintiff’s motion for
is “not an invitation to renew the motion.”
spoliation sanctions.

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CASE LAW ALERTS:
Sanctions Motions Denied
Late Is Better than Never
WHY THIS CASE IS IMPORTANT
Because of the COVID-19 pandemic, more employees are working remotely, which can make the
discovery of physical files more complex. It’s imperative that legal teams have new procedures for
identifying physical documents whether they are located remotely or at a company’s place of work.
Overview
In this civil rights case involving a recently fired
employee, the plaintiff moved for attorney’s fee and
spoliation sanctions based on the defendant’s “alleged
spoliation of a physical file containing ‘documents
relating to Mr. Sanz (plaintiff).”
The plaintiff requested a file containing the plaintiff’s
supervisor’s notes regarding plaintiff’s employment.
The notes were not immediately produced. After the
plaintiff first filed a motion for spoliation sanctions, the
defendant discovered the file and a copy of the file was
produced.
The plaintiff still wanted to move forward with his
motion for spoliation sanctions. The plaintiff alleged
that, because of the circumstances surrounding the
file’s production, he “ha[d] no way of determining
whether the file presented is the original file or
whether documents have been removed—by anyone.”
The plaintiff requested an adverse inference instruction
or the ability to present testimony about the discovery
of this document.
Ruling
• Motion for Adverse Inference
Instruction Denied.
Since the physical file was produced to the
plaintiff, there was no spoliation and the plaintiff
did not prove that the defendant acted in bad
faith in not immediately producing the requested
file. However, the court did grant attorney’s fees
based on the defendant’s delayed production of
the physical file, which was only produced after
the motion for spoliation sanctions was made.
13 Case Law Spoliation Sanctions
SPOLIATION CLOSE
CALL INVOLVING PAPER
DOCUMENTS & WORK-
FROM-HOME
CASE ENTRY
Ricardo Sanz v. Wells Fargo Bank
(S.D. Fla. June 21, 2021)
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• Bad Faith.
To prove bad faith, the moving party must offer
direct or circumstantial evidence that proves
relevant information existed, the spoliating party
intentionally caused the evidence to be lost, a
duty to preserve the evidence was established,
and the spoliating party does not have a credible
basis to contradict the bad faith claim.
• No Proof of Bad Faith.
The court found here that there was no bad faith
attempt to conceal the requested documents.
The defendant explained that the supervisor
was working remotely because of the pandemic
and didn’t look for the file until after returning to
her office. The court noted that mere negligence
would not warrant an adverse inference sanction
and then went on to state that “the Court is not
willing to make the leap and opine there is some
nefarious intent behind Defendant’s actions.”
EXPERT ANALYSIS
By David Cohen, Esq. Partner and Chair of Records
and E-Discovery Group, Reed Smith LLP
As Magistrate Judge Goodman notes,
there can be no successful spoliation
claim absent evidence that relevant
documents were actually lost—a
mere delay in production does not
consititute spoliation of evidence,
whether proceeding under FRCP
37(e)(covering electronic evidence) or common law
(covering hard copy documents).
© 2022 Exterro, Inc. // exterro.com
CASE LAW ALERTS:
Sanctions Motions Denied
Deactivation Isn’t Deletion
WHY THIS CASE IS IMPORTANT
As more information is stored on social media accounts, it’s imperative that legal teams ensure
proper preservation of social media data. As this case shows, social media information has become
a very common source for relevant data, which legal teams must have a plan for preserving.
Overview
In this personal injury case involving the plaintiff, an
employee of the defendant, a truck driver, getting
into a car crash. The plaintiff subsequently asserted
tort claims against the defendant based on a theory
of respondeat superior. The defendant moved for
sanctions against the plaintiff for his “alleged spoliation
of electronically stored evidence, specifically his social
media accounts.”
From the outset of this case, the two sides
were “frustrated with each other.” The plaintiff
misrepresented multiple times whether he had a
Facebook account, how many Facebook accounts
he had and if those accounts were activated pre-and
post-accident. Based on this behavior the defendant
wanted the plaintiff to be sanctioned for spoliation of
the Facebook account data.
The plaintiff objects to the spoliation sanction and
offered an alternative remedy of an information
resolution before defendant files it’s motion. The
plaintiff contended that the Facebook data may be
retrievable. The defendant refused and motioned the
court for spoliation sanctions.
Ruling
• Court Denies Spoliation Motion.
The court ruled against the defendant because
there was no proof that the Facebook had been
“irretrievably lost,” which is required under FRCP
37(e) to warrant spoliation sanctions.
14 Case Law Spoliation Sanctions
DOES DEACTIVATING
A FACEBOOK ACCOUNT
CONSTITUTE SPOLIATION?
CASE ENTRY
Brown v. SSA Atlantic
(S.D. Ga. March 16, 2021)
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• No Clear Evidence of Spoliated Facebook Data.
According to the court, it was “not clear that
any evidence has been spoliated, as opposed
to withheld.” The plaintiff only deactivated it’s
Facebook accounts, not deleted.
• Plaintiff Ordered to Produce
Facebook Account Data.
The court gave the plaintiff a deadline to
produce the requested data and if the defendant
concludes “that substantive information
was, in fact, lost or destroyed because of the
“deactivation,” it is free to renew its motion for
spoliation sanctions.
EXPERT ANALYSIS
By Hon. Andrew Peck (Ret.), Sr. Counsel, DLA Piper
Several lessons from this case: first,
courts do not appreciate lawyers
sniping at each other. Second, it is
clear by now that relevant Facebook
posts are discoverable, especially in
Personal injury cases. Third, there is
a difference between deactivating a
Facebook account (which thus can be reinstated with
no loss of data) and deleting the account. Finally, this
is another example of courts relying on the Rule 26(g)
certification as another source to remedy discovery
violations.
© 2022 Exterro, Inc. // exterro.com
CASE LAW ALERTS:
Sanctions Motions Denied PARTIES ESCAPE
“Woeful Lack of Proactivity” SPOLIATION SANCTIONS
Insufficient EVEN WITH A “WOEFUL
LACK OF PROACTIVITY”
CASE ENTRY
Wolff v. United Airlines, Inc.
(D. Colo. September 17, 2019)

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WHY THIS CASE IS IMPORTANT

Despite being reactive rather than proactive regarding their preservation obligations, the
two parties in this case escaped spoliation sanctions—even though both parties showed a
“woeful lack of proactivity, thoughtfulness or reasonableness in attempting to meet their
preservation obligations.”

Overview • Defendant’s motion for spoliation

In this employee termination/discrimination case, the
plaintiff and the defendant both moved for spoliation
sanctions against each other.
The plaintiff alleges that the defendant failed to
preserve his company cell phone, company computer,
and handwritten notebooks, all of which contained
relevant evidence to the case. Based on this spoliation,
the plaintiff sought a default judgement. The defendant
argued that the plaintiff’s cell phone was never
received from the plaintiff when he left and that his
computer was “repurposed.”
On the other side, the defendant “likewise cries
‘spoliation’ because Plaintiff failed to preserve his
personal cell phone,” moving for an adverse inference
instruction. The plaintiff justified not having his cell
phone based on it either falling “into a lake when he
was fishing, or he turned it in when he upgraded
his phone.”
Ruling
• Plaintiff’s motion for spoliation sanctions denied.
For the cell phone, the court ruled that the
plaintiff never offered any evidence that the
plaintiff’s company cell phone was in their
possession. For the company computer, the
plaintiff’s counsel admitted that they weren’t
aware of any relevant evidence being stored on
the plaintiff’s company computer.
sanctions denied. The court rejected the
plaintiff’s motion because there was “a lack of
evidence of an intent to deprive Defendant of the
evidence allegedly contained on the personal cell
phone.”
• Fault on both sides regarding
e-discovery practices.
Even though no spoliation sanctions were issued,
the court was “troubled” by the e-discovery
conduct of both the plaintiff and the defendant.
Specifically the court took issue with the
defendant’s “failure to suspend its automatic
deletion of emails” and the plaintiff’s loss of
his personal cell phone. Both were held to be
unreasonable acts after the duty to preserve
was triggered.
EXPERT ANALYSIS
By Mike Hamilton, J.D.
Director of Marketing, Exterro
The court’s ruling is a perfect
example of how FRCP 37(e)
will not sanction parties
where there was no proof of
prejudice and/or relevancy of
the spoliated data. However,
parties still must be careful
that the court possess its inherent authority
to issue sanctions outside of 37(e) for conduct
such as this.

15 Case Law Spoliation Sanctions © 2022 Exterro, Inc. // exterro.com

 KEY TAKEAWAYS
These recent cases show how courts are interpreting FRCP 37 (e). To avoid
sanctions, parties to litigation must avoid displaying an intent to deprive.

DON’T:

• Destroy evidence—or its equivalent.

• Use technology to hide the truth.

• Commit perjury. (We probably shouldn’t have to say this.)

Delays in production, recoverable data, and even a lack of initiative or

competence won’t earn a sanction—but they may just lose you the case.

The simplest means for an organization to protect itself is to

implement good faith legal hold and preservation processes.
In today’s technology environment, that requires a reliable,
effective legal hold solution. Of course, you should also stay up
to date on the latest e-discovery case law as well!

16 Case Law Spoliation Sanctions © 2022 Exterro, Inc. // exterro.com

 DON’T GET SANCTIONED!
Make sure you’re complying with your e-discovery obligations with the
industry’s leading legal hold technology: Exterro Legal Hold.

һ Optimized Workflows
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