Party Is Sanctioned for Destruction of Electronic Documents After Receiving a Claim

November 25, 2013

U.S. Law Presumes Prejudice Even If Data Are Protected by Law of a Party’s Country


Destroying electronic records relevant to a pending claim or lawsuit is never a good idea, even when emails are destroyed or deleted without malevolent intentions. A federal court in New York has ruled that, “When evidence is destroyed willfully or through any gross negligence, prejudice to the innocent party may be presumed,” as a matter of law.

The reason, according to the court, is that when electronic documents requested for production cannot be produced because the evidence was deleted or destroyed intentionally, the judge can reasonably assume the deleted evidence would have been helpful to the other side. Moreover, the court may impose sanctioned for failure to produce the destroyed evidence. The complaining party does not have to show malevolence. It is enough to prove that a hold was not placed on the file until long after the claim was filed and that the emails or other relevant data were intentionally deleted. (Sekisui Medical America v. Hart).

After a claim is filed, no documents in the relevant file should be destroyed. Not even duplicates, for explaining that the destroyed emails or data were duplications only raises an issue of credibility which will be overcome by the presumption. When a claim is received, the hold should be placed promptly on relevant files of any department or of any outside investigators.

In a parallel case involving a Brazilian plaintiff, an apology and cultural explanation for failure to produce requested documents in the same court got nowhere when months went by and the plaintiff failed    to produce documents that are requested by a defendant on discovery.

The Brazilian plaintiff claimed he did not understand English. His lawyers went to Brazil to discuss discovery requirements with him, but after a seven-month delay. They found plaintiffs had not produced several documents because they were considered private and protected from revelation under Brazilian law, which provide that “the secrecy of correspondence and of telegraphic data and telephone communications is unviable.”

But the judge found the plaintiff and his trust “had a culpable state of mind as they and their counsel were at least negligent” in failing to comply with U.S. court rules for months. The judge added that having availed themselves of a United States court system, plaintiffs “have no credible excuse for their blatant disregard of the discovery process.” The judge imposed sanctions on the plaintiff and his trust. (Valentini v. Citigroup).

This article is from Montgomery McCracken’s Fall/Winter 2013 Maritime and Transportation Newsletter.