Commission on Law & Technology
|Working Group||View From the Bench|
|Topic||Spoliation of Evidence|
|Date of Publication||January 1, 2014|
|Summary||This is the first in a series of short articles that will discuss technology and ethical considerations arising in litigation, presented chronologically from commencement to appeal. Each article will be presented by one or more of the members of the View From the Bench, a working group of the Delaware Commission on Law & Technology. The information to be provided is not exhaustive; rather, the series is intended to provide Delaware lawyers with guidance regarding technology and the practice of law, from the Delaware Judiciary's perspective, to promote competency and compliance with the Delaware Lawyers' Rules of Professional Conduct.|
|Applicable DLRPC (Rules)||Preamble, 1.1, 1.6, 3.3, 3.4
Disclaimer: The purpose of this leading practice is to provide the Delaware Bench & Bar with an understanding of an appropriate manner in which this technology may be used. There may be more appropriate uses; and the leading practice discussed might not be appropriate for a specific purpose. It is up to the individual to use well-reasoned judgment in making that decision. The Commission is not responsible for the consequences of the decision-making process.
Article No. 1: Spoliation of Evidence
This article focuses on spoliation of evidence in the context of advances in technology. As an initial matter, all Delaware attorneys should be familiar with the common law duty to preserve potentially relevant evidence under a party's custody or control. 1 Compliance with this duty is particularly important because of the increasing use of electronically stored information ("ESI"). ESI takes many forms (e.g., e-mail, word-processing documents, and audio and text messages) and can be stored on myriad platforms (e.g., laptop or desktop computers, commercial storage devices such as servers, portable storage devices such as USB drives, and cell phones and tablet devices). In addition, even cases with relatively few or straightforward legal issues can involve voluminous quantities of ESI. Absent reasonable, affirmative steps to preserve relevant ESI, it easily may be altered, destroyed, or otherwise lost. Failing to take such steps to preserve relevant ESI once litigation is commenced or is reasonably anticipated can result in serious consequences for parties and attorneys. Two examples are helpful.
In Beard Research, Inc. v. Kates, 2 the Court of Chancery drew an adverse inference against the defendant because he recklessly destroyed and lost his laptop computer's hard drive after he was on notice (and even instructed by counsel) that ESI on that hard drive could be relevant to the suit filed against him. In that case, the defendant repeatedly deleted documents, "emptied the recycle bin," and reformatted the hard drive. In addition, he arranged for the hard drive to be replaced, and then he lost the old drive that contained the potentially relevant information. Because of the defendant's actions, the Court not only drew an adverse inference against the defendant, but also awarded plaintiffs the attorneys' fees and expenses they incurred in discovering defendant's actions (including forensically analyzing relevant hardware) and in litigating the relevant motions.
In TR Investors, LLC v. Genger, 3 because the defendant arranged for a server to be "wiped" even though he knew it stored relevant ESI, the Court of Chancery granted plaintiffs' motions for contempt and spoliation, awarded monetary sanctions (at least preliminarily in the amount of $750,000), and elevated by one level the defendant's burden of persuasion (i.e., from a preponderance of the evidence burden to the clear and convincing standard).
The Beard Research and TR Investors cases illustrate the growing need to develop and oversee a preservation process and the consequences of failing to do so. To fulfill the duty to preserve relevant evidence, parties and attorneys must familiarize themselves with the types of evidence that parties possess that could be relevant to litigation and how that evidence can and should be preserved.
The Delaware Bar has several resources available to attorneys explaining the evolving nature of the duty to preserve potentially relevant ESI and describing best practices to comply with it.
Resources related to spoliation of evidence and the duty to preserve:
Delaware Lawyers'Rules of Professional Conduct, Preamble, 1.1, 1.6, 3.3, 3.4
Sears Roebuck & Co. v. Midcap, 893 A.2d 542 (Del. 2006).
Lesh v. ev3, Inc., 2013 WL 3155761 (Del. Super. Apr. 16, 2013).
TR Investors, LLC v. Genger, 2009 WL 4696062 (Del. Ch. Dec. 9, 2009), aff'd in part, rev'd in part,
Genger v. TR Investors, LLC, 26 A.3d 180 (Del. 2011).
M.C. v. Dep't of Servs. for Children, Youth, & Their Families, 2011 WL 1707250 (Del. Fam. Mar. 24, 2011).
Cruz v. G-Town P'rs, L.P., 2010 WL 5297161 (Del. Super. Dec. 3, 2010).
Beard Research, Inc. v. Kates, 981 A.2d 1175 (Del. Ch. 2009).
Triton Constr. Co. v. E. Shore Elec. Servs., 2009 WL 1387115 (Del. Ch. May 18, 2009).
Administrative Directive of the President Judge of the Superior Court of the State of Delaware,
No. 2010-3, App. B (eff. May 1, 2010)
Guidelines to Help Lawyers Practicing in the Court of Chancery § II.7.a-7.b.
Court of Chancery Guidelines for the Collection and Review of Documents in Discovery
Court of Chancery Guidelines for Preservation of Electronically Stored Information
The Sedona Guidelines: Best Practices & Commentary for Managing Electronic Information in the Electronic Age