Olson v. Sax, 2010 WL 2639853 (E.D. Wis. June 25, 2010)
Citing a lack of evidence that defendants “engaged in the ‘bad faith’ destruction of evidence for the purpose of hiding adverse evidence” and Fed. R. Civ. P. 37(e), the court denied plaintiff’s motion for sanctions for defendants’ destruction of relevant videotape, despite the existence of a duty to preserve.
On July 31, 2008, defendants terminated plaintiff’s employment alleging that she had “filed [sic] out false credit slips”. In her subsequent lawsuit, plaintiff alleged she was terminated for discriminatory reasons. The alleged theft was apparently recorded on videotape on July 22, 2008. Plaintiff asked to see the tape upon her termination. It is unclear if her request was granted at that time. The tape was also requested in the normal course of discovery, although the date of that request is also unclear. Regardless, defendants were unable to produce the tape because it had been erased. Plaintiff sought sanctions precluding defendants from producing evidence of the alleged theft and an award of expenses for bringing the motion.
Defendants argued that they were protected from sanctions pursuant to Rule 37(e), which precludes the imposition of sanctions where electronically stored information is lost as the result of “routine, good faith operation[s] of an electronic information system.” Specifically, the defendants asserted that the lost recording was created using a digital video recorder that saved surveillance footage for approximately 29 days before automatically recording over it. Defendants further asserted that they were unaware of the possibility of litigation until receipt of a letter from plaintiff’s counsel on February 24, 2009 – approximately seven months after the alleged theft occurred (and long after the tape had been erased).
Based on the dates of correspondence between the parties (and their counsel), the court determined that the defendants were aware of the possibility of litigation by August 11, 2008 and thus had a duty to preserve the evidence. The court further determined that as of that date, the video recording had not been overwritten.
Citing Rule 37(e), the court nonetheless declined to impose sanctions absent evidence that the destruction was in “‘bad faith’ for the purpose of hiding evidence” – a “prerequisite to imposing sanctions for the destruction of evidence.”