Electronic Discovery Law
No Sanctions For Failure to Preserve Where Deleted Call Recordings "would not have been supportive of Plaintiff's claim"
Cottle-Banks v. Cox Commc'ns, Inc., No. 10cv2133-GPC (WVG), 2013 WL 2244333 (S.D. Cal. May 21, 2013)
In this putative class action, Plaintiff sought sanctions for Defendant’s failure to preserve potentially relevant customer call recordings. Although the court found that Defendant was negligent in its failure to preserve (and thus had the requisite “culpable state of mind”), no sanctions were ordered because the court concluded that the call recordings would not have supported Plaintiff’s case.
In September 2010, Plaintiff filed her initial complaint alleging Defendant’s violation of the federal Cable Act by charging rental fees for cable converter boxes and/or remote controls that class members “did not affirmatively request by name.” In July 2011, Plaintiff filed an amended complaint, after her initial complaint was dismissed.
Defendant’s customers ordered cable either over the telephone, in person at a retail location, or online. Some calls were recorded and used for quality control and training purposes, including calls related to cable, telephone, wireless and internet sales. Cable sales calls could not be separated without listening to the recordings themselves. Because of limited storage capacity and because Defendant did not have “a business need for calls older than 45 days,” the call recordings were automatically overwritten after that time. Every night Defendant created backup tapes of its “production servers” for disaster recovery purposes. The tapes were typically maintained for 30 days.
In June 2011, Plaintiff sought production of customer call recordings and, through counsel, asserted that Defendant had failed to preserve those recordings and instead continued to “routinely” tape over them. Defendant’s counsel responded that the call recordings were “on a constant 45 day cycle” and that Plaintiff’s call recording was “long gone” before the case was filed. At that time, Defendant began preserving backup tapes containing call recordings which reached back as far as April 2011. Eventually, Defendant was ordered to produce a random selection of calls and ultimately produced 280 of them - only a small number of which were relevant to Plaintiff's claims. Of those, Plaintiff identified two that supported her claims.
Plaintiff sought sanctions for Defendant’s failure to preserve. Addressing the motion, the court first identified the three-part test adopted by California district courts when considering an adverse inference instruction which requires that the party with control of the evidence had an obligation to preserve it at the time it was destroyed, that the records were destroyed with a "culpable state of mind," and that "the evidence was 'relevant' to the party's claim or defense such that a reasonable trier of fact could find that it would support that claim or defense."
The court found that Defendant’s obligation to preserve arose upon Plaintiff’s filing of her initial complaint and rejected the argument that it failed to provide notice that the calls could be relevant.
Turning to Defendant’s state of mind, Plaintiff argued that bad faith was not needed to establish a culpable state of mind and that “blatantly failing to preserve and erasing the backup tapes” was enough. Alternatively, if bad faith was required, Plaintiff argued that Defendant was willful and acted in bad faith by failing to place a litigation hold. Defendant argued there was no bad faith and that “the calls were overwritten pursuant to a routine business policy” and because of a lack of storage space. Reasoning that “Plaintiff ha[d] not shown that Defendant engaged in bad faith” and that “Defendant d[id] not argue that it was not negligent in failing to preserve the back up tapes,” the court concluded that Defendant was negligent and thus, had a “culpable state of mind.” Had bad faith been established, that would have been “sufficient” on its own to demonstrate relevance. Because Defendant was merely negligent, Plaintiff was obligated to establish that the recordings would have been relevant and supportive of her claims.
The court concluded the calls would not have supported Plaintiff’s claims. In making this finding, the court relied in large part upon the fact that only 2 of the 280 calls already produced were supportive of her position and upon Defendant’s showing that its training practices were unchanged since 2008 (a response to Plaintiff’s claim that the calls were relevant, in part, because they dated back to a time before Defendant could change its practices in response to this lawsuit).
Thus, Plaintiff’s motion for an adverse inference was denied. The court also concluded that Plaintiff had not been prejudiced and therefore declined to preclude Defendant from introducing evidence of its compliance with the relevant statute. Notably, the court indicated that the motion was alternatively denied as untimely where Plaintiff had learned of the ongoing overwriting of call recordings as early as May 2011 but failed to seek sanctions until February 2012 and instead filed two motions to compel, one of which was ultimately withdrawn.
A copy of the court’s order is available here.
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