When will deletion of e-mails after a hold order result in a mandatory adverse-inference instruction?

Want to Delete Those Important E-mails? Appeal to the Notion of Cleaning Out Junk.

To receive a mandatory adverse-inference instruction for spoliation, three requirements must be met: 1) The targeted litigant destroyed evidence at a time when he had a duty to preserve the evidence, 2) the targeted litigant acted with intent or gross negligence, and 3) the destroyed evidence was relevant to the movant’s claims. The finding of relevance turns on whether a reasonable trier of fact could infer that the destroyed or unavailable evidence would have been of the nature alleged by the party affected by its destruction. If the three requirements are met, the trier of fact may receive a mandatory adverse-inference instruction, meaning they must infer that the evidence was unfavorable to the discovered party. Courts are usually reluctant to grant a dispositive motion based solely on spoliation unless the discovered party acted with bad faith and willfulness, and there is no other effective remedy.

Enter the former Chairman of the Board of Celestica Inc. (“Chairman”). In 2007, a written document-preservation instruction was sent from corporate counsel to all employees at the outset of the litigation in In re Celestica Inc. Securities Litigation. In 2012, when the Chairman retired from the Celestica Board, he deleted all of his e-mails on his personal computer. The Chairman described the practice as “routine,” because he “[didn’t] want to fill up [his] hard drive with a bunch of junk.” Hard to disagree with him, right? Cleaning out our computers and inboxes has come to be a regular and necessary burden. Based on the Judge’s findings of simple negligence, he agreed.

The court found that in the instant case, defendants were not grossly negligent, and noted that the Chairman himself was not a defendant in the litigation. Defendants did their due diligence in issuing a written hold instruction to both corporate employees and to the Board of Directors. There is nothing to indicate that defendants were responsible for the Chairman’s disregard of that instruction five years after its issuance. The court reasoned that at most it could infer that defendants may have failed to collect documents saved on the Chairman’s hard drive during the years the case was pending prior to his retirement, but that this is merely simple negligence.

As for relevance and prejudice, the court noted that although the deletion of the Chairman’s e-mails makes it difficult to assess the relevance of the e-mails, the fact that e-mail communications have both an addressor and an addressee casts doubt on the likelihood of irremediable prejudice to plaintiffs. The court addressed plaintiffs’ concerns about the unavailability of e-mails between the Chairman and another Executive Committee member, whose computer was unavailable because of a hard-drive failure. The court pointed out that both executives had been deposed and had testified about the emails, and that there was no evidence that the lost e-mails even addressed the issues at play in plaintiffs’ case.

Finally, the court focused on the fact that plaintiffs made no effort to show that they did not have ample documentation of the corporation conditions they claim were misrepresented or concealed by defendants. Ultimately, the court denies plaintiffs’ application for a mandatory adverse-inference instruction, but grants them a permissive adverse-inference instruction.

Renée received her B.A. in Criminal Justice from Villanova University in 2013. She will receive her J.D. from Seton Hall University School of Law in 2016. After graduation, Renée will serve as law clerk to a criminal judge of the Superior Court of New Jersey in Hunterdon County.

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