Rule 37(f) Safe Harbor Provision Requires a Routine System in Place and Some Affirmative Action by Party to Prevent System from Destroying or Altering Information

Doe v. Norwalk Community College, 2007 WL 2066497 (D. Conn. July 16, 2007)

In this case, plaintiff Jane Doe sued Norwalk Community College ("NCC") and Ronald Masi claiming she was sexually assaulted by Masi, a former professor at the college.  Doe filed her complaint in November 2004, and in March 2006, Doe moved to compel the inspection of certain electronic records possessed by NCC.  The court granted the motion in July 2006, and permitted plaintiff’s expert to inspect certain NCC computers.  Based upon her expert’s findings, Doe moved for sanctions, seeking an adverse inference with regard to electronic files which she claimed the defendants destroyed.

Specifically, Doe claimed that the hard drives of key witnesses had been scrubbed or completely wiped of data.  Further, her expert found inconsistencies in the mailboxes of four individuals that suggested to him that data had been altered, destroyed or filtered.  For example, one witness’s PST file contained no Deleted Items and only one Sent Item and the Inbox and Sent Items contained data starting August 2004, even though other activity was present starting in 2002.  In addition, Doe presented evidence that the retention policy issued by the State Library, which provided for a two-year retention with respect to electronic correspondence, governed NCC, and that this policy was not followed with respect to the hard drives of the computers of faculty members who left the college.

In response, defendants argued that there was confusion over which hard drives plaintiff’s expert had examined.  Further, they argued that NCC did not follow the State Librarian’s document retention policy because it did not apply to “normal computer usage” and because transitory email messages did not need to be maintained.  However, the defendants could not point to any written policy which supported this view.

In addition, defendants argued that “evidence discussing Defendant Masi contained in various backup servers as well as computers from NCC faculty and staff were turned over to the plaintiff,” thus presenting “powerful evidence” that the defendants did not destroy all emails or documents regarding Masi.  Defendants claimed that they provided Doe with “approximately six emails” referencing Masi, one of which was written by someone who claimed Masi “was always touching me.”  The court noted that, although the email was written more than three months prior to the filing of Doe’s lawsuit, the email postdated her incident with Masi by six months and did not respond to Doe’s argument that certain evidence was destroyed “that would support the plaintiff’s claim that NCC had actual notice of Masi’s conduct” prior to the incident of which she complained.

Citing Residential Funding Corp. v. DeGeorge Fin. Corp., 306 F.3d 99, 107 (2d Cir. 2002), the court observed that a party seeking an adverse inference based on spoliation must establish: "(1) that the party having control over the evidence had an obligation to preserve it at the time it was destroyed; (2) that the records were destroyed ‘with a culpable state of mind’; and (3) that the destroyed 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 plaintiff had established the first element, “strongly disagree[ing]” with defendants’ argument that the duty to preserve did not arise until well after Doe filed her lawsuit in November 2004, perhaps when Doe had indicated her need for the electronic discovery in her Rule 26(f) Report, dated February 18, 2005.  The court found that the duty to preserve "certainly" arose no later than September 2004, when Doe’s counsel sent the defendants a demand letter indicating Doe’s intention to sue NCC.  In fact, the court believed the duty to preserve had arisen by February 13, 2004, when a meeting was held between NCC’s dean and two professors regarding the Doe incident, which indicated to the court that, as of that date, NCC was aware of Doe’s allegations of sexual assault by Masi.

The court found that NCC had failed to suspend its routine document retention/destruction policy or to put a litigation hold in place to ensure the preservation of relevant documents.  It noted that defendants had admitted that they “scrubbed” Masi’s hard drive “pursuant to normal NCC practice” after he resigned and left the college.  Further, other defense witnesses had testified that they had never been asked to do a records search regarding the case, had never heard of the term “litigation hold,” or had never been told to refrain from destroying documents during the pendency of the litigation.

The court firmly rejected the defendants’ attempt to invoke the “safe harbor” provision of Fed. R. Civ. P. 37(f):

With respect to the destruction of electronic data, the defendants cite to newly-promulgated Rule 37(f) of the Federal Rules of Civil Procedure, which states:  “Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system.”  Fed. R. Civ. P. 37(f).  However, the Commentary to that Rule indicates that, “[w]hen a party is under a duty to preserve information because of pending or reasonably anticipated litigation, intervention in the routine operation of an information system is one aspect of what is often called a ‘litigation hold.’ “  Id. at Advisory Committee Notes to 2006 Amendment.  Thus, in order to take advantage of the good faith exception, a party needs to act affirmatively to prevent the system from destroying or altering information, even if such destruction would occur in the regular course of business.  Because the defendants failed to suspend it at any time . . . the court finds that the defendants cannot take advantage of Rule 37(f)’s good faith exception.

In addition, as the Commentary to Rule 37(f) indicates, the Rule only applies to information lost “due to the ‘routine operation of an electronic information system’ — the ways in which such systems are generally designed, programmed, and implemented to meet the party’s technical and business needs.”  See Fed. R. Civ. P. 37(f) at Advisory Committee Notes to 2006 Amendment.  This Rule therefore appears to require a routine system in order to take advantage of the good faith exception, and the court cannot find that the defendants had such a system in place.  Indeed, testimony at the Hearings revealed that, after NCC shifted over to the Hartford server in August 2004, emails were backed up for one year; however, emails pre-dating this transfer were only retained for six months or less.  Thus, the defendants did not appear to have one consistent, “routine” system in place, and Bissell admitted at Hearing II that the State Librarian’s policy was not followed.  Counsel for the defendants also indicated at Oral Argument that he was not aware that the defendants did anything to stop the destruction of the backup tapes after NCC’s obligation to preserve arose.

(Footnote omitted).

The court ruled that Doe had also established the requisite culpability, finding the defendants’ failure to place a litigation hold and to preserve emails and hard drives relevant to Doe’s allegations in this case to be “at least grossly negligent, if not reckless.”  The court noted that there was no evidence that the defendants did anything to stop the routine destruction of the backup tapes after NCC’s obligation to preserve arose.  Further, it found that other evidence of selective destruction of emails demonstrated intentional behavior and “evidence tampering.”

As to the third element, the court stated that no proof of relevance was necessary, since Doe had demonstrated that the defendants’ failure to preserve hard drives and emails of certain key players in Doe’s lawsuit was at a minimum grossly negligent.  However, even if such a showing were necessary, the court found that Doe had satisfied it by offering evidence regarding one deleted email and a missing computer file the title of which referenced Masi.

Accordingly, the court found that plaintiff was entitled to an adverse inference jury instruction with respect to the destroyed evidence.  In addition, the court awarded Doe her reasonable attorneys’ fees and costs incurred in connection with the motion, as well as the expert fees incurred with respect to the forensic investigation of NCC’s computers.

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