New Forensic Technology Assists Courts in Sniffing Out Foul Play

Can a Former Employee Get Away with Evidence Spoliation?

We often hear about the use of forensic evidence in murder mysteries pertaining to DNA testing or finding fingerprints at the murder scene.  As technology continues to advance, however, forensic evidence has made its way into civil cases.  In the technological world, even if you delete an email or a text message, the information can easily be restored.  Furthermore, evidence that you blatantly tried to delete a particular document or text can be used to draw a negative inference regarding your culpability.  Before considering “hiding” or “deleting” information on a computer or smartphone device, always remember that forensic evidence will come back and bite you.

In a May 2015 case, HMS Holdings Corp. v. Arendt, two former HMS employees learned the hard way that human beings cannot outsmart technology.  To assist their new employer, Public Consulting Group, Inc. (PCG), compete against their former employer, Health Management Systems (HMS), defendants Sean Curtin and Danielle Lange violated their post-employment covenants and used confidential HMS documents to the benefit of PCG.  In response to the litigation, PCG circulated a Litigation Hold Notice to particular employees, including Curtin and Lange, which advised the employees of their obligation to preserve all electronically stored information (ESI) “on computers, removable or portable storage media, office computers, cellphones and personal computers.”

About a month later, the parties to this case entered into a Stipulation Regarding Expedited Discovery.  Under the Stipulation, the defendants needed to forensically image their personal computers, phones, zip drives, and other electronic devices to be searched.  Although defendants handed over certain devices, not all devices were handed over and in some cases the defendants were not honest about what information these devices really contained or, more accurately, what they no longer contained.

This case mentions four devices in particular: (1) Curtin’s Macbook Pro; (2) Curtin’s external Toshiba hard drive; (3) Lange’s PCG laptop; and (4) Lange’s iPhone.  Ultimately, the court found spoliation of evidence on all four devices and sanctioned the defendants accordingly.

In order to prove spoliation of evidence, the party seeking sanctions, here HMS, must show that: (1) the party with control over the evidence was under an obligation to preserve it at the time of alleged destruction, which begins when a party reasonably anticipates litigation; (2) the party destroyed the records with a culpable state of mind; and (3) the destroyed evidence was relevant to the party’s claim or defense.  Relevancy of the third element is presumed upon intentional, willful or grossly negligent destruction of evidence.

First the court analyzes Curtin’s Macbook Pro, which forensic evidence revealed had run a “Secure Erase Free Space” function six times after the Litigation Hold Notice.   Forensic evidence also showed that Curtin did not use this function prior to these six times.  Curtin alleged that he ran this program to help increase his laptop’s operating speed.  Despite his explanation, Curtin failed to provide evidence as to why he failed to use a different version of the software that would increase operating speed without permanently deleting files.  With a showing of willful destruction, a presumption of relevance attaches.

Unlike his Macbook, Curtin was unable to provide any forensic imaging of his Toshiba external hard drive, despite the fact that considerable evidence showed that had copied volumes of confidential HMS materials to it the day before he left.  Upon review, the court finds that Curtin intentionally and willfully failed to produce the hard drive despite his legal obligation to do so.  Again, a presumption of relevance attaches to the hard drive ESI.

Lange has the same fate as Curtin before the court.  Shadow Copies, partial snapshots in time of a computer’s content made by the Microsoft Windows system, revealed that her PCG laptop contained HMS files before the pending litigation that no longer existed after the filing of the suit.  Evidence shows that not a couple, but rather 5,300 files, were deleted from her laptop during a month-long period of time.  Lange, also an attorney, claimed that these were pertinent files but were deleted to protect client confidences.  Despite her explanation, the court found spoliation and a presumption of relevance attached.

Finally, Lange’s text messages caused her some problems as well.  Lange claimed to have replaced her iPhone 4 for a new iPhone 5, something many could relate to in 2014 when the new and improved Apple device hit the market.  However, unlike many other customers, Lange’s old iPhone 4 had important text messages pertaining to the case and was replaced after the issuance of a Litigation Hold Notice.  Lange claims that she had dropped her iPhone 4 so badly that even those at the AT&T store could not restore her messages.  Despite this explanation, forensic evidence revealed that messages were actually uploaded to her laptop computer one week after her upgrade.  In light of this evidence, the court again found spoliation of evidence and a negative presumption of relevance.

With all four electronic devices being used to destroy evidence, the court now is tasked with determining the proper sanctions.  The court has wide discretion in determining appropriate sanctions.  Due to the egregious misconduct of both Curtin and Lange, the court allows the jury to draw a mandatory adverse inference regarding the destroyed evidence.  Since there is no way to determine the contents of the evidence destroyed, the court finds this to be the most fair to HMS.

In addition to the mandatory inference, the court also requires defendants to pay HMS’s reasonable attorney’s fees, costs, and expenses incurred as a result of their misconduct, with no reimbursement or indemnification from PCG.  Also, since Lange is an attorney, the court will forward this information to the appropriate ethics board regarding her fitness to practice law.  Hopefully the defendants in this case learned that forensic evidence does not lie and as technology increases, it is increasingly more difficult for us to cover our own tracks by simply clicking a “Delete” button.

Laura Cicirelli, a Seton Hall University School of Law student (Class of 2016), has served as an Associate Editor and is currently serving as the Editor-in-Chief of the Seton Hall Law Review. Following graduation, Laura will be joining the firm of Debevoise & Plimpton as a corporate associate in its New York City office.  Prior to law school, Laura attended the University of Scranton (Class of 2013) where she majored in marketing and double minored in operation and information management and philosophy.

Comments (1):

  1. Authority and determination making ought to be unfold throyghout thee business structure as well.

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