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Court Cannot Find ESI Spoliation Where Documents May or May Not Have Existed

Posted on May 22nd, 2017

find esi spoliationIn Aronstein et. al. v. Thompson Creek Metals Company Inc., et. al., Case No. 15-00204 (D. Colo., Apr. 27, 2017), Plaintiffs, former investors of Defendant Thompson Creek, sued Defendants in federal court in Connecticut for allegedly distributing “false and misleading” information about Thompson’s financial condition, causing them significant losses. Defendants removed the case to federal court in Colorado.

Plaintiffs allege that Defendants estimated costs of $915 million for a project termed the Mt. Milligan Project when Defendants knew that the project would cost substantially more than that. In a July 2010 board meeting, Terry Owen, a former Thompson employee, projected that the cost would increase by $250 million. The agenda for a November 2010 board meeting stated that Owen would provide a presentation about the project.

During discovery, Defendants produced the board meeting agenda but did not produce the Owen presentation. Defendants’ counsel represented that Owen could not recall whether he made a physical document. However, Owen’s deposition testimony indicated that he had created a presentation “in no uncertain terms.” He also testified that, as of the November 2010 board meeting, his opinion on the cost increase had not changed. Board meeting materials for the February 2011 meeting showed a total cost of over $1.25 billion. Defendants alleged that no documents created or modified from October 2010 to May 2011 existed on Owen’s computer hard drive. When Owen left Thompson, the local files on his computer were transferred to the company’s shared drive, which had not been altered or deleted and which contained 36 gigs of non-email files. Plaintiffs filed a Motion for Sanctions and also a Motion to Amend the Complaint based upon the missing files.

Plaintiffs asserted that there must have been “a vast amount” of important documents on Owen’s computer and that these documents were “missing.” Plaintiffs sought a ruling from the court that failure to preserve these documents meant that Defendants knew that the expected cost of the project was over $1.25 billion. The court refused, saying it was “unwilling to make either unfounded assumption.” The court also found that Plaintiffs could not state with certainty what the possibly missing documents contained. An assumption could not be made that the missing documents would show what Defendants knew about the cost of the project without knowing the content. Ultimately, the court held that it could not find ESI spoliation when the court could not “even get a grasp on precisely what information is alleged to have gone missing.” Further, there was no evidence that any documents were actually missing, as there was no real evidence that the presentation existed or that Owen or anyone else had deleted it.

Accordingly, the court denied Plaintiffs’ motions.

ILS – Plaintiff eDiscovery Experts

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