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District Court Ups the Monetary Sanctions for Defense Production Spoliation in Multifeeder

Posted on October 19th, 2012

In reviewing the recommendations of the magistrate judge in Multifeeder Technology, Inc. v. British Confectionery Company Limited (2012 WL 4135848 (D. Minn.)), the district court noted that sanctions for spoliation require a finding of an intentional destruction of evidence indicating a desire to suppress the truth. Id. at 4, citing Greyhound Lines, Inc. v. Wade, 485 F.3d 1032, 1035 (8th Cir. 2007).

Defendant David Connolly claimed none of the evidence destroyed was related to the lawsuit.  However, the only evidence he offered was viewed as self-serving testimony, and the court noted the timing of the computer wiping software (right before the computer forensics expert began) was particularly damning. The court also found defendant Blair Connolly’s actions constituted spoliation when he refused to inform anyone of an encrypted volume of data and deleted email chains less than two weeks after the ESI Protocol Order was in effect.  While the court noted it was “possible” that the emails were irrelevant to the litigation, the timing of the complete deletion was suspect and evidenced spoliation.

Plaintiff also objected to the magistrate’s recommendation, claiming the payment was inadequate given the prejudice against them as a result of the defendants’ action. It was discovered after the magistrate’s recommendation that the system had, in fact, been destroyed and would greatly prejudice plaintiff’s case. Plaintiff also argued that the  availability of depositions by defendants was not a true mitigating factor.

Plaintiff sought an increase to $692,534, including $490,542 incurred by the computer forensics expert and $176,607 for their attorney fees and costs in enforcing the ESI Protocol Order (plus the $25,000 fine to the court). The district court agreed that in light of the defendant’s “abusive discovery” behavior, appropriate monetary sanctions payable to plaintiff should be $600,000.

With the increasing prevalance of cases surrounding spoliation of electronic data discovery and the trend of courts around the country taking a harsher view on such conduct,  to learn more about how our plaintiff eDiscovery services can assist in uncovering evidence spoliation, please contact us directly at 888-313-4457.

ILS – Plaintiff Electronic Discovery Experts

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