Electronic Discovery and Evidence

2.75 Million Dollar Fine - Spoliation of E-mail

United States v. Philip Morris, USA, Inc., No. CIV.A.99-2496, 2004 WL 1627252 (D.D.C. July 21 2004). The company failed to follow the preservation order and destroyed e-mail for over two years. A number of high ranking officers who were to be called as witnesses did not retain their e-mail under a "print and retain" policy. The Court ordered that the defendant was precluded from presenting any fact witness who had failed to preserve relevant records and was ordered to pay $2.75 million in fines for its spoliation of e-mail.

Judge Imposes Sanctions for Failure to Retain E-Mail

(7-9-04) Mosaid's stock skyrockets on Samsung sanctions . "The stock of Mosaid Technologies surged as much as 44 per cent Friday morning after the market reacted to the news that it had gained some ground in its landmark patent case against South Korean electronics giant Samsung. . . . On Thursday, the judge overseeing the case in a New Jersey court, Ronald Hedges, granted Mosaid a number of sanctions against Samsung. . . . Mosaid had requested sanctions against Samsung on the grounds that it has failed to provide certain documents during the discovery phase of the case and destroyed e-mail evidence related to the case. . . "Part of Samsung's strategy seems to have been to unfairly delay and bias the case outcome by either withholding or destroying critical documents. The court obviously agreed with Mosaid in granting these significant sanctions since in Judge Hedges Order he writes, when referring to Samsung's destruction of e-mails: 'The prejudice resulting from complete and total e- mail spoliation seems particularly obvious... the fact that no technical e-mails were preserved... demonstrates, at the least, extremely reckless behaviour'."

Read the order - click here!

Comment: Once again the judiciary is taking the lead in understanding and applying electronic discovery technical and legal issues to cases.

Legal and Ethical Obligations to Preserve Electronic Data

The Duty To Preserve Electronic Data By Judge Curt B. Henderson .

Comment: Short but effective article on the duty of lawyers to preserve electronic data.

Sanctions May be Imposed for Inadvertent Erasure of E-mail Backup

Keir v. UnumProvident Corp., 2003 WL 21997747 (D. N.J. Aug. 20 2003).

The Court was highly critical of the defendant's failed efforts to retain e-mails that were not retained even though a preservation order was in place for these e-mail.

Sanctions Imposed for Subpoenaing E-mail from Internet Service Provider (ISP)

Just because e-mails are available through an Internet Service Provider does not mean that you have the right to subpoena them. In a must read decision the 9th Circuit recently imposed sanctions on defendants for an overbroad subpoena of “[a]ll copies of emails sent or received by anyone at ICA, with no limitation as to time or scope.” Theofel vs. Farey-Jones, 341 F.3d 978, 981 (9th Cir. 2003). The plaintiffs argued that the improper disclosure of e-mails resulted in the violation of the Stored Communications Act, the Wiretap Act, and the Computer Fraud and Abuse Act.

The Court of Appeals, Kozinski, Circuit Judge, held that: (1) disclosure by plaintiffs ISP of e-mail messages, pursuant to defendants invalid and overly broad subpoena, did not constitute an "authorized" disclosure under the Stored Communications Act; (2) e-mail messages which were delivered to recipient and stored by ISP were in "electronic storage," under Stored Communications Act; (3) no "interception" occurred in violation of Wiretap Act; (4) Computer Fraud and Abuse Act provided cause of action for unauthorized access to information stored on third party's computer; and (5) Noerr-Pennington immunity did not protect conduct of serving invalid subpoena.

E-mail & Sanctions

Kucala Enterprises, Ltd. v. Auto Wax Co., Inc., 56 Fed.R.Serv.3d 487 (N.D. Ill. May 27 2003)

The magistrate found that e-mails and other electronic documents were discoverable as well as deleted documents still located in a computer's hard drive. The court imposed the hartsh sanction of dismissal of the lawsuit as well as requiring competitor to pay attorneys' fees and costs for competitor's actions of using a computer program called "Evidence Eliminator" to delete documents from his computer, or in alternative, to "clean" his hard drive. Such actions were unreasonable, in addition to not preserving evidence in his control, over which he had a duty to maintain. Case affirmed in most respects by the district court. Kucala Enterprises, Ltd. v. Auto Wax Co., Inc., 2003 WL 22433095 (N.D. Ill. Oct. 27 2003).

Zubulake IV

Zubulake decision now available.http://www.arkfeld.com/resource%20material/Zubulak%20IV.pdf