Attendees at our firm’s seminars will have heard the term “spoliation,” referring to the destruction of evidence. The issue typically comes up in the context of documents or evidence that is transitory, such as data from a Truck’s ECM, or an outdoor accident scene. Essentially, a party warns another party by letter to preserve evidence. If the evidence is not preserved, a court may sanction the party failing to preserve evidence with either an “inference” or a “conclusive presumption” that the evidence would have favored the other side. In some cases the effect is to substantially reduce a burden, either of proof or of persuasion.
The gamesmanship of spoliation comes into play when a request is made incredibly broad, in some cases seeking preservation of hundreds of itemized documents or evidentiary sources. Since it is not necessarily true that there is a case pending, there may be no way to seek judicial narrowing or a protective order, and in some cases the spoliation letter may come years (in the case of a child plaintiff, possibly decades) before any case is filed. By claiming, often with wild, unsubstantiated claims of pivotal importance that some innocuous information was spoliated, or destroyed, one party can force another on the defensive because of some act taken in the distant past. As a result a spoliation or “litigation hold” letter may become an offensive tool, rather than an evidentiary one, to effectively flip a burden of proof onto another party (usually a defendant). Courts were generally mindful of this issue, if not always sympathetic to a party that destroyed evidence.
Perhaps as a result, the Virginia Supreme Court may be argued to have almost eliminated spoliation as an issue in its opinion in Emerald Point, LLC v. Hawkins, 294 Va. 544, 558-559, 808 S.E.2d 384, 392-393 (2017):
… the evidence must support a finding of intentional loss or destruction of evidence in order to prevent its use in litigation before the court may permit the spoliation inference. In short, we agree that “[t]o allow such a severe sanction as a matter of course when a party has only negligently destroyed evidence is neither just nor proportionate.”
(Emphasis added). My suspicion is that “intentional” is going to undergo some substantial redefinition in the future because 1) proving intent to prevent the use of something in litigation is going to be nearly impossible, and 2) it is very easy to consider circumstances where evidence may be recklessly destroyed, rather than merely negligently or with deliberate intent, but where that recklessness is in the face of a clear need to preserve evidence and the prejudice to another party is catastrophic. Recent cases involving the destruction or salvage of a vehicle involved in an accident without notifying the other party come to mind.
For instance, in Ward v. Tex. Steak Ltd., Civil No. 7:03cv00596, 2004 U.S. Dist. LEXIS 10575 (May 27, 2004), the Plaintiff sat in a chair, which collapsed, and told the Defendant he might file a claim if his pain continued. The Defendant discarded the chair anyway. The Court applied a spoliation inference:
In light of these principles, the court finds that an adverse inference against the defendants is appropriate for the purposes of this summary judgment motion. Ward told Mitchell that he would probably file a claim unless the pain stopped, and Mitchell’s knowledge may be imputed to the defendants. … Consequently, the defendants knew a potential dispute existed. Furthermore, the chair was clearly relevant evidence to the dispute. However, despite knowing of the potential dispute and that the chair would be relevant evidence in a dispute, the defendants made no effort to preserve the chair. Thus, for the purposes of this motion, the court finds that defendants acted negligently by not attempting to preserve the chair and that Ward is entitled to an inference that, had the chair been preserved, it would have provided some evidence unfavorable to the defendants.
The facts of Kettler Int’l, Inc. v. Starbucks Corp., 96 F. Supp. 3d 563, 2015 U.S. Dist. LEXIS 45465 (2015) are nearly identical (albeit with more potential plaintiffs), except there the Court stuck it to Starbucks for getting rid of chairs that allegedly injured people after finding that Starbucks’ legal department may have been involved in the decision to do so.
Similarly, the trial court in the divorce case of Bannon v. Bannon, 89 Va. Cir. 274, 2014 Va. Cir. LEXIS 127 (Hanover Nov. 5 2014) applied a spoliation inference where a cell phone, portable drive, and native accounting software files were not produced, permitting the court to infer that “1. Had the requested electronic devices been produced and not reformatted, the devices would have provided evidence of the Defendant’s adultery; [and] 2. Had the requested electronic devices been produced and not reformatted, the devices would have provided evidence of the Defendant’s secretion and waste of marital assets.”
Still, every company should have in place procedures to immediately preserve certain obviously important documents, items, or information when litigation seems a significant possibility. Things such as communications with or regarding an opposing party, the reasons behind a particular policy or course of action, physical evidence, video or audio recordings, etc. should be maintained as a matter of course. Involving counsel early may allow them to help identify what to preserve and how, as well as helping to argue that efforts to obtain some information are privileged or work-product prepared specifically in anticipation of litigation.
If you have any questions about this article, please contact Dov Szego at 804.377.1263 or firstname.lastname@example.org, or Steve Setliff at 804.377.1261 or email@example.com.