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Court Denies Spoliation Sanctions in Delaware Bay Oil Spill Litigation

Posted on August 12th, 2016

In re Frescati Shipping Company Ltd., Case Nos. 05-305, 08-2898 (E.D. Pa., July 25, 2016), the Eastern District of Pennsylvania considered spoliation sanctions in a litigation involving which party should bear the costs of the multi-million dollar oil spill cleanup that followed a collision between oil tanker M/T Athos I and a ship anchor on the bottom of the Delaware Bay.

During the litigation, the oil company that chartered the ship, CARCO, alleged that the owner of the ship, Frescati, spoliated evidence in that Frescati lost, destroyed or altered the ship’s original voyage plan, the rough deck log, the cargo control room log, the pump room patrol logs, the wheelhouse poster, and the loadicator data. CARCO also asserted that Frescati failed to produce certain discovery, including emails, related to the accident.

The court noted that a court can award spoliation sanctions in the Third Circuit when a party suppresses or withholds relevant evidence provided that the party had a reasonably foreseeable duty to preserve. Sanctions are appropriate depending on the fault of the spoliating party, the degree of prejudice to the aggrieved party, and whether there is a lesser sanction available. The court also noted that adverse inference instructions are only appropriate with a showing of bad faith or intent.

Here, Frescati had produced over 100,000 documents to CARCO and had searched for and collected documents from the ship for preservation and retention; thereafter, the ship was taken from Frescati’s control. Frescati produced the final voyage plan as it was kept in the ordinary course of business and produced photocopies of the log books as well. No evidence existed that anyone had removed any pages or altered any content in bad faith. While Frescati could not locate several documents requested by CARCO, the court found Frescati’s explanations reasonable and denied the motion for spoliation sanctions, finding no evidence of bad faith or intentional destruction.

ILS – Plaintiff eDiscovery Experts

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