The landmark sanctions order in Phillip M. Adams & Associates v. Dell, 621 F.Supp.2d 1173 (D. Utah 2009) has been adopted by U.S. District Judge Ted Stewart.  Finally made available to the public last week after a nine-month delay (http://1.usa.gov/lz5Ekj), Judge Stewart’s order (http://bit.ly/iT5ciG- PACER, sign-up req’d) fully embraced the magistrate’s holding that organizations have an obligation to preserve relevant evidence after the duty to preserve attaches.  The court thus imposed a negative inference jury instruction against defendants Asustek Computer and Asus Computer Intl. for their evidence spoliation.  It should come as no surprise that the jury then returned a verdict against those defendants.

With the Adams sanction order finally in the books, it is worth reviewing why that decision was so noteworthy.

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Is your organization adequately prepared for a lawsuit?  Or are you still trying to develop an internal process for addressing document productions in litigation?

Preparing a litigation response effort is an essential aspect of a company’s information governance plan.  Failing to take the initiative in this regard often leads to higher legal costs and increased risks during litigation.  The Vieste, LLC v. Hill Redwood Development (N.D. Ca. June 6, 2011) case from last week is particularly instructive on this issue.

In Vieste, the court sanctioned several real estate developers for submitting inadequate declarations regarding their document preservation efforts.  Those declarations reveal an overall failure to prepare for litigation.  Among other things, the defendant developers did not issue a litigation hold; did not suspend the overwrite function of one of their computer systems; and waited several months to contact...

The eDiscovery frenzy that has gripped the American legal system over the past decade has become increasingly expensive.  Particularly costly are inquiries into an organization’s data management practices and production efforts.  These investigations are lengthy and often disruptive to business operations.  Just as troubling, they increase the expense and duration of litigation.  Given these cost and delay issues, it is no wonder that jurists are looking for alternative methods to rein in “promiscuous discovery.”  The latest approach is found in Federal Rule of Civil Procedure 1.

Federal Rule 1 establishes a compelling directive that is tailor made for eDiscovery.  More than just a vestigial preamble to the Federal Rules, Rule 1 requires the “just, speedy, and inexpensive determination of every action and proceeding.”

To understand just how courts are recognizing the value of Rule 1’s decree to address...

Several recent court cases have imposed sanctions on companies that unwittingly turn over the duty to manage, archive and discard data to their rank and file employees.  One of the latest examples – Suntrust Mortgage, Inc. v. AIG United Guaranty Corp. (E.D. Va. Mar. 29, 2011) – demonstrates how expensive that approach to information governance can be.

In Suntrust Mortgage, a Virginia federal court issued sanctions against plaintiff Suntrust for falsifying evidence.  Several key emails between the parties that supported the defendant’s arguments were altered by a Suntrust employee to bolster the plaintiff’s claims.  When the truth eventually came out, Suntrust’s credibility – and pocketbook – took a hit.  Indeed, a motion for attorney fees is now pending to recoup the nearly $4 million the defendant incurred to address that malfeasance.

While evidence falsification is an uncommon occurrence...