Hearing - How to lose an unloseable employment law case

By: Gregory A. Hearing, Esq.

Thompson, Sizemore, Gonzalez & Hearing, [email protected]

(813) 273-0050

How to Lose An Unloseable Employment Law Case

One plaintiff’s attorney lists the following in his Top Ten ways to win an employment law case:

“4. Choose a case with defective/inept human resource department. Look for a case with a bad human resource administrator or defective discrimination/retaliation policy that is not actually implemented, (a "paper HR policy"). Such improper handling of known acts of discrimination in the work place combined with acts of retaliation against employees who complain of discrimination make for good damage awards. I call these inept HR administrators ‘dinosaurs’. . . .”

Source: McGovern, Glenn C., My Top 10 Ways to Win An Employment Case, Law Office of Glenn C. McGovern Metairie, La, http://www.glennmcgovern.com/CM/Custom/My-Top-10-Ways-To-Win-An-Employment-Case.asp.

H.R. From A Plaintiff’s Perspective

Don’t Be A Dinosaur!!

Most Human Resources administrators work diligently to avoid employee lawsuits. Among their efforts, H.R. administrators :

•Follow company handbooks and policies•Strictly adhere to Performance Improvement Plans•Seek advice from attorneys when making decisions•Create a paper trail for actions taken relating to employees

“But I did everything I could . . . .”

These actions may help put a company in a position for victory, however, despite H.R. managers’ efforts to create an “unloseable” case, specific H.R. administrative/employee decisions may transform an employment law case from a “winner” to a “loser.”

This presentation focuses on decisions and actions by H.R. administrators or company employees that may cause an employer to lose an otherwise winnable case:

I) Surefire ways to lose a winnable employment law case.

II)Dangers and pitfalls surrounding electronic discovery in the employment law context.

Presentation Overview

Surefire Ways to Lose An Employment Law Case

1. Naturally Reactive/Knee-Jerk E-mails

Surefire Ways To LoseNaturally Reactive E-mails

E-mails are so easily fired off in the workplace that administrators, supervisors, or managers may send out an e-mail without thinking or reflecting on the e-mail, especially after a confrontation with an employee.

The employer may have a legitimate basis for terminating an employee, however, a single e-mail can become the smoking gun in a case.

Managers/Supervisors need to be reminded to carefully consider all e-mails before hitting “send.”

Illustration:An employee has a disability. The employer, aware of the disability, provides reasonable accommodations to the employee. One day, the employee gets into a disagreement with her supervisor. The supervisor, in a heated state, blasts off an e-mail stating, “I’m sick of dealing with that crippled woman.” Months later, the supervisor transfers the employee to a different position due to budget cuts. As a result, the employee brings a suit alleging that she has been discriminated against in violation of the ADA. The e-mail is found through discovery.

That one e-mail will be the first thing the jury sees.

The e-mail may be enough to create a question of factand preclude summary judgment.

Surefire Ways To LoseNaturally Reactive E-mails


1. Naturally Reactive/Knee-Jerk E-mails2. Unmonitored Post-Termination Employee Actions

Surefire Ways to Lose Unmonitored Post-Termination Employee Actions

Employers must monitor employees after they are terminated.

Terminated employees may access, alter, or delete documents that may be critical for proving an employer’s defense to claims by a former employee.

Surefire Ways to Lose Unmonitored Post-Termination Employee Actions

Illustration:

An employee is terminated from his managerial position after violating the company’s anti-solicitation policy. After termination, the employer does not cut off the employee’s access to relevant documents pertaining to solicitation activities. The employee deletes/destroys significant documents, including e-mails, and .pdf’s, pertaining to the solicitation issue. The employer does not have copies of pertinent files used in the decision to terminate the employee.

Surefire Ways to LoseUnmonitored Post-Termination Employee Actions

Practice Tips:

1.Escort the employee off the premisesafter termination;

2. Cut off the employee’s ability to access e-mail, servers, and company databases immediately after termination;

3.Conduct a proper exit interview (see next slide).

Surefire Ways to LoseUnmonitored Post-Termination Employee Actions

Make use of an exit interview checklist, which may include the following items:

I) COLLECT applicable items from employee:

Employee ID badge, company keys

Company materials (i.e., manuals, files, etc.)

Company phone/data device/remote access card

Company computer/modem/laptop

II) ADDITIONAL Supervisor Responsibilities:

Complete separation of employment paperwork; Notify H.R.

Ensure that e-mails and voicemails are re-directed

Delete the employee’s log-ins/passwords


1. Naturally Reactive/Knee-Jerk E-mails2. Unmonitored Post-Termination Employee Actions3. Unemployment Hearing Testimony

Surefire Ways to LoseUnemployment Hearing Testimony

Unemployment hearings, if taken lightly, may come back to haunt employers in a later lawsuit filed by an employee who previously sought unemployment compensation.

Witness testimony during unemployment hearings is sworn testimony that may be used in a subsequent case.

Employers can lose a case through one sentence in an unemployment hearing transcript.

Employers must adequately prepare witnesses. Do not take the unemployment hearing lightly.


1. Naturally Reactive/Knee-Jerk E-mails2. Unmonitored Post-Termination Employee Actions3. Unemployment Hearing Testimony4. Not Taking Employee Complaints Seriously

Surefire Ways to LoseNot Taking Employee Complaints Seriously

• Supervisors/Managers who fail to investigate employee complaints, even when they may not necessarily perceive an employee’s statements as a complaint, risk turning a very defensible case into a potential loser.

• Remember, just because an employee complains about workplace behavior does not mean that the employer will be liable.

Surefire Ways to Lose Not Taking Employee Complaints Seriously

Illustration:

A supervisor disciplines an employee for mistreating a customer in violation of company policy. After issuing the employee a written warning, the employee says “I’ll deal with this one, but you have no idea what kind of harassment I deal with every day in the office.” The employer, thinking the employee is just upset about discipline, ignores the complaint.

Surefire Ways to LoseNot Taking Employee Complaints Seriously

Good Practice:

1) Do not assume that a comment was “just made in anger” and is not an actual complaint;

2) When in doubt, construe an unclear comment as a complaint;

3) Clarify whether the employee is actually making a complaint;

4) Investigate the complaint thoroughly and in a manner consistent with any applicable procedures.


1. Naturally Reactive/Knee-Jerk E-mails2. Unmonitored Post-Termination Employee Actions3. Unemployment Hearing Testimony4. Not Taking Employee Complaints Seriously5. Failure to Document Actions

• Employers may act appropriately in response to workplace incidents (employee complaints, violations of company policy, etc.), but failure to document such actions will be fatal to defending an employment law case.

• Always ensure that investigations, terminations, and/or other disciplinary action are well documented and easily retrievable.

• Provide copies of applicable documents to the employee and H.R. department.

Surefire Ways to LoseFailure to Document Actions

• Employers must ask: “Do I have the documents to back up my version of the story?”


1. Naturally Reactive/Knee-Jerk E-mails2. Unmonitored Post-Termination Employee Actions3. Unemployment Hearing Testimony4. Not Taking Employee Complaints Seriously5. Failure to Document Actions6. Inaccurate Performance Evaluations

Surefire Ways to LoseInaccurate Performance Evaluations

Employers/supervisors are often reluctant to give an employee a negative employee performance evaluation.

WHY?

1)The supervisor doesn’t want to issue a negative evaluation to a senior employee who has been at the company for many years;2)The supervisor has a close friendship with the employee;3)The supervisor recently issued a negative evaluation and doesn’t want to issue back-to-back negative evaluations.

Failing to issue performance evaluations that truly reflect an employee’s performance may come back to haunt the employer.

Surefire Ways to LoseInaccurate Performance Evaluations

Illustration:

An employee is not performing her daily assigned tasks. The employee’s supervisor discusses the problem with the employee and places the employee on a Performance Improvement Plan (“PIP”). The employee shows very little progress on the PIP. Instead of issuing a negative performance evaluation, the supervisor gives the employee a positive evaluation as a “motivating” strategy. The employee’s performance continues to decline and the supervisor terminates the employee. The employee later brings an age discrimination claim, and points to the positive evaluation to show she was performing satisfactorily and to prove discriminatory animus.

The POINT: complete performance evaluations accurately!


1. Naturally Reactive/Knee-Jerk E-mails2. Unmonitored Post-Termination Employee Actions3. Unemployment Hearing Testimony4. Not Taking Employee Complaints Seriously5. Failure to Document Actions6. Inaccurate Performance Evaluations7. Information Does Not Reach Appropriate Individuals

Surefire Ways to LoseInformation Does Not Reach Appropriate Individuals

An H.R. department must stress to all managers and supervisors the importance of reporting employee requests/complaints/issues to appropriate individuals in the H.R. department.

Without funneling such information to H.R., the employer cannot address an employee’s request/complaint/issue. Thus, an issue that could have been addressed easily flies under the radar until it later surfaces as a lawsuit.

Surefire Ways to LoseInformation Does Not Reach Appropriate Individuals

Illustration:

An employee mentions to his supervisor that he believes he has a disability and needs an accommodation. The employee fills out an accommodation request form and provides it to the supervisor. The supervisor, who is constantly busy, forgets to forward the request to H.R. The accommodation would have been relatively simple to provide, but the employee does not receive it. The employee later brings an ADA suit against the employer based on its failure to accommodate.


1. Naturally Reactive/Knee-Jerk E-mails2. Unmonitored Post-Termination Employee Actions3. Unemployment Hearing Testimony4. Not Taking Employee Complaints Seriously5. Failure to Document Actions6. Inaccurate Performance Evaluations7. Information Does Not Reach Appropriate Individuals8. Mishandling the EEOC

Surefire Ways to LoseMishandling the EEOC

An employer’s decision not to respond to a charge of discrimination filed with the EEOC or other state agency may prevent an employer from easily disposing of a case.

Providing a sound position statement often results in no action by the state agency or EEOC, causing the would-be-plaintiff to “go away.”

Surefire Ways To LoseMishandling the EEOC

Employers must verify that the statements and facts set forth in a position statement are accurate and supported by evidence.

Where the statements in a position statement are later recanted/changed by an employer, or are eventually disproven through discovery, a plaintiff will often rely on these inaccuracies to show pretext in a discrimination suit.

Don’t let an employee argue: “You said I was fired for tardiness in your position statement, now you’re saying it was because I was drinking on the job. Clearly, your change of position shows that you did not have a legitimate non-discriminatory basis for firing me.”


1. Naturally Reactive/Knee-Jerk E-mails2. Unmonitored Post-Termination Employee Actions3. Unemployment Hearing Testimony4. Not Taking Employee Complaints Seriously5. Failure to Document Actions6. Inaccurate Performance Evaluations7. Information Does Not Reach Appropriate Individuals8. Mishandling the EEOC9. Failure to Discipline Employees

Other Surefire Ways to Lose . . .Failure to Discipline Employees

Poor performers cause more than just productivity problems.

As mentioned previously, inexperienced or untrained managers often dread the difficult task of confronting poor performers and explaining their shortcomings as employees.

Failing to discipline an employee can create unanticipated consequences for employers.

Surefire Ways to Lose Failure to Discipline Employees

Don’t give an employee a basis to challenge an adverse employment action by saying:

“I have been doing it that way for 20 years and no one said it was wrong. What changed?”

“I had no idea I wasn’t doing a good job.”

Trying to be a “nice boss” or “letting the small stuff slide” may turn an otherwise defensible case sour. Remember the saying, “No Good Deed Goes Unpunished.”

Other Sure Fire Ways to Lose An Employment Law Case

1. Naturally Reactive/Knee-Jerk E-mails2. Unmonitored Post-Termination Employee Actions3. Unemployment Hearing Testimony4. Not Taking Employee Complaints Seriously5. Failure to Document Actions6. Inaccurate Performance Evaluations7. Information Does Not Reach Appropriate Individuals8. Mishandling the EEOC9. Failure to Discipline Employees10. E-Discovery/Spoliation

Electronic Discovery*

With the rapid introduction of technological advancements over the last two decades, the practice of law has changed substantially.

Electronically Stored Information (“ESI”) and electronic discovery are quickly becoming normal and routine issues in civil cases.

Think about it: Almost everyone uses a computer at work and most documents/information now originate as electronic documents.

*For an in-depth review of the e-discovery issues discussedin this presentation, see Jeffrey J. Fowler & William H. Dance, Preserving Electronically Stored Information: A Practical Approach, BNA’s E-Discovery Portfolio Series, No. 3 (2007).

Electronic Discovery

Employers no longer operate in a paper world; a vast amount of electronically stored information now exists in:

e-mails, spreadsheets, .pdf’s, “cloud storage,” servers, data centers, and other electronic documents.

ESI presents specific challenges:

ESI may be easily altered and contains information that does not exist in paper documents, such as meta-data, history, and formulas.

ESI is usually more voluminous than paper documents because it is stored in multiple versions and locations.

Electronic DiscoveryRules of the Game

Federal

In an effort to respond to the increased electronic nature of documents, the Federal Rules of Civil Procedure were amended in 2006, codifying developing e-discovery case law:

• The 2006 amendments introduced concepts of ESI into the federal procedural rules:

• Rule 26 Disclosures (parties are to discuss ESI in the Case Management Conference)

• Rule 33 Interrogatories (parties may use interrogatories to seek information regarding ESI)

• Rule 34 Request to Produce (parties may request ESI through requests for production).


Federal

In the federal court system, parties are typically sanctioned for e-discovery violations pursuant to Rule 37 or the court’s inherent power to control judicial proceedings.

• Although F.R.C.P. 37(e) provides a safe-harbor provision (“A court may not impose sanctions under theses 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”), parties have not had much success relying upon this provision as a defense.

• Moreover, some courts have held that a party may not rely on Rule 37(e) unless it has implemented a litigation hold (discussed in more detail below). See Doe v. Norwalk Cmty. Coll., 248 F.R.D. 372, 378 (D. Conn. 2007).


FloridaThe Federal Rules of Civil Procedure and federal

case law has shaped the e-discovery universe and has provided guidance for state courts.

• Florida is one of a few states that has not revised its rules of civil procedure to specifically address ESI. Florida courts therefore generally rely on common law decisions to resolve e-discovery matters (although there is not a great deal of Florida case law addressing e-discovery).

•The Florida Rules of Civil Procedure do not incorporate language addressing ESI, however, proposed amendments to conform Florida’s procedural rules to the Federal Rules of Civil Procedure were submitted to the Florida Supreme Court in January, 2011, for review and approval.

E-DiscoverySpoli what?

E-Discovery and the applicable procedural rules/case law regarding e-Discovery have changed the way litigation is conducted and the obligations imposed on litigants regarding preservation of ESI.

Litigants who fail to “follow the rules” or take the necessary actions to preserve ESI can be sanctioned for “spoliating evidence.”

Spoliation: 1) The intentional destruction, mutilation, alteration, or concealment of evidence, usually a document; 2) The taking of a benefit properly belonging to another (Black’s Law Dictionary, 9th ed. 2009).

Spoliation is a serious matter.

Electronic DiscoverySanctions

Sanctions for e-discovery violations/spoliation are generally only available upon a party’s ability to show:

1)The alleged spoliating party had control over ESI and had an obligation to preserve it at the time of destruction or loss; 2) acted with a culpable state of mind upon destroying or losing the ESI; and 3) the missing evidence is relevant to the innocent party’s claim or defense. Pension Committee Of the University of Montreal v. Bank of America Securities, 685 F.Supp.2d 456 (S.D.N.Y. 2010).

Likewise in Florida, the elements for a cause of action for spoliation are:

1)Existence of a potential civil action; 2) a legal or contractual duty to preserve evidence which is relevant to the potential civil action; 3) destruction of that evidence; 4) significant impairment in the ability to prove the lawsuit; 5) a causal relationship between the evidence destruction and the ability to prove the lawsuit; and 6) damages. Golden Yachts, Inc. v. Hall, 920 So. 2d 777, 781 (Fla. 4th DCA 2006); Hagopian v. Publix Supermarkets, Inc., 788 So. 2d 1088, 1091 (Fla. 4th DCA 2001).

Electronic DiscoveryWhy is this important?

A recent study concluded that:

• Over the past six years, sanctions relating to e-discovery requests had increased substantially.

• An analysis of pre-2010 case law shows that there were more e-discovery sanction cases (ninety-seven) and e-discovery sanction awards (forty-six) in 2009 than in any prior year.

• Defendants are three times as likely to receive sanction for e-discovery than plaintiffs.

• The most common reasons for sanctions are failure to preserve electronic data and failure to produce electronic data.

•Source: Dan H. Willoughby, Jr., Rose Hunter Jones, & Gregory R. Antine, Sanctions for E-Discovery Violations: By the Numbers, 60 Duke L.J. 789 (2010).

Electronic Discovery Case Illustrations

Cases highlight the variety of sanctions that courts have issued for mishandling e-discovery:

1.Adverse Inference Spoliation Jury Instructions

Pension Committee of the University of Montreal v. Bank of America Securities, 685 F.Supp.2d 456 (S.D.N.Y. 2010) (plaintiff investors brought suit against hedge fund administrator. After concluding that several plaintiffs failed to institute litigation holds and actively deleted potentially relevant e-mails, amounting to gross negligence, the court sanctioned plaintiffs by ordering adverse inference jury instructions to be read at trial and awarded defendant attorney’s fees and costs).

Easton Sports, Inc. v. Warrior LaCrosse, Inc., 2006 WL 2811261 (E.D. Mich. Sept. 28, 2006) (concluding that a marketing director who worked for the plaintiff had inappropriately accessed numerous confidential electronic documents on the defendant’s computer record system, transferring a portion of those records to a personal Yahoo account, and finding that the director later terminated his Yahoo account in an effort to destroy any data compiled through that service. As a sanction, the court ordered that the jury would receive special instruction advising them of the destroyed evidence).


Strasser v. Yalamanchi, 783 So. 2d 1087 (Fla. 4th DCA 2001) (an appropriate remedy for destruction of a hard drive containing relevant ESI includes instructing the jury of the pre-trial discovery conduct of the offending party).

2. Entry of default/dismissal

Gillett v. Michigan Farm Bureau, 2009 WL 4981193 (Mich. Ct. App. Dec. 22, 2009) (plaintiff in a sexual harassment case admitted he deleted potentially relevant e-mails prior to filing the case. As a sanction for spoliation, the court dismissed the plaintiff’s case).

Krumwiede v. Brighton Associates, L.L.C., 2006 WL 1308629 (N.D. Ill. May 8, 2006) (plaintiff’s destruction of data amounted to spoliation. Computer experts analyzed the plaintiff’s computer and found that the plaintiff performed maintenance, including defragmentation, on the computer after the court issued a preservation order. The court held that the actions constituted a willful attempt to frustrate discovery, entered a default judgment against the plaintiff, and awarded the defendant attorney’s fees and costs).


3. Shifting Evidentiary Burdens

Coleman Holdings, Inc. v. Morgan Stanley & Co., Inc., 2005 WL 679071 (Fla. 15th Cir. Mar. 1, 2005) (holding that defendant spoliated evidence by overwriting e-mails when it had knowledge of litigation. As a sanction, the court shifted the burden of proof on the issue of fraud to the defendant).

4. Denying Prevailing Party Attorney’s Fees

Broccoli v. Echostar Communications Corp., 229 F.R.D. 506 (D. Md. 2005) (Involving breach of contract claims and sexual harassment claim. Jury found for the plaintiff on the contract claim, but not on the sexual harassment claim. Post-trial, the judge refused to award defendant attorney’s fees on the sexual harassment claim, reasoning that the defendant’s spoliation of evidence led to the plaintiff’s loss of the sexual harassment claim).

Electronic DiscoveryDuty to Preserve

• To avoid sanctions, an employer must ensure that it does not breach its duty to preserve ESI.

•The question, then, becomes when does the duty to preserve arise?

• The duty to preserve generally arises when a party knows of or reasonably anticipates litigation involving identifiable parties and identifiable facts.


Clearly, a filed lawsuit or request to produce would create a preservation duty on behalf of the litigants.

However, when does a party “anticipate litigation?”

Precisely when, or if, a duty to preserve arises prior to litigation requires a fact-intensive analysis.


A variety of factors/factual scenarios will help determine when, or if, a duty to preserve arises. A duty may exist when:

1) An employee sends pre-litigation correspondence to an employer.

• Examples:An employee’s attorney threatens litigation;An employee sends a letter stating that the employer is infringing upon his or her rights.

2) An employee files a complaint with the EEOC.

3) A government entity investigates an employer’s actions.


4) An internal investigation reveals that an employee may bring a lawsuit against the company.

5) Other similarly situated employees have brought lawsuits against the employer.

6) An employer learns that an employee has retained counsel.

7) Supervisors/decision makers have a reasonable anticipation that an employee will bring suit.

• Case example: In Broccoli v. Echostar Communications Corp., 229 F.R.D. 506 (D. Md. 2005), the court held that the employer should have anticipated litigation where the plaintiff had complained of sexual harassment for a year prior to termination.


If an employer has a duty to preserve, how far does an employer have to go in preserving ESI?

Courts suggest that there are limits: “While a litigant is under no duty to keep or retain every document in its possession . . . It is under a duty to preserve what it knows, or reasonably should know, is relevant in the action . . . .” Telectron, Inc. v. Overhead Door Corp., 116 F.R.D. 107, 127 (S.D. Fla. 1987).

Thus, the law does not expect perfection, but rather expects parties to act reasonably and in a timely manner to ensure that relevant ESI is protected. See Concord Boat Corp. v. Brunswick Corp., 1997 WL 33352759, at *4 (E.D. Ark. Aug. 29, 1997) (“[T]o hold that a corporation is under a duty to preserve all e-mail potentially relevant to any future litigation would be tantamount to holding that the corporation must preserve all e-mail . . . . Such a proposition is not justified.”).

Electronic DiscoverySatisfying the Duty to Preserve

Once a duty to preserve is established, courts provide guidance on what employers must do to meet the duty:

I) First, the party (and the party’s counsel) must “become fully familiar with the client’s document retention policies” and “speak with ‘key players’ in the litigation” to understand how ESI is stored.” Zubulake v. UBS Warburg, 229 F.R.D. 422 (S.D.N.Y. July 20, 2004).


In fulfilling this obligation, employers should consider, and have anunderstanding of, whether relevant ESI exists on/in:

• Local hard drives (personal computers, laptops, desktops)• Deleted files• Temporary files and cache data• E-mail accounts (work accounts and personal)• Portable media (external hard drives, CD’s, thumb drives)• Cell phones• Employees’ home computers (where employees bring work

home or work from home)• Network servers• Company databases• Off-site storage facilities (including data centers)• A back-up tape system for computer files


Employers must be able to answer many, if not all, of thefollowing questions:

1) What ESI is collected?

• E-mail?• Word Processing Documents?• Spreadsheets?• Presentations? • Graphics?• Digital Images?• Audio or Video Records?• Instant Messages?• Meta-data?• Voicemail?• Text Messages?• Bookmarks/Internet History/Cookies?


2) Is data routinely or automatically destroyed?

• How difficult is it to stop the process?• What is the cost of stopping the process?• How much data will accumulate if the process is stopped?• Can automatic or routine purging be stopped for specific users?

3) Where are electronic files stored?

• Why are files stored where they are stored?• Can files be stored on individual computers, personal

computers, removal media (disks, CDs, thumb drives, etc.)?• Is there a company policy prohibiting storage outside of the

network?• Is the system configured so files may only be stored on the

network?• What third parties store the client’s data files?


4) Has the system been upgraded during the relevant discovery period?

• Did all/some/none of the data from the old system migrate to the new system?• Is there proof that all/some of the old data migrated?• Are old systems or computers available for inspection?

5) What backup procedures are used?

•Is the data for the relevant discovery period only on backup tapes?•How are backup tapes compiled?•Are backup tapes cumulative?•What is the cost of restoring a backup tape?


6) Has any information, favorable or unfavorable, to the company been deleted?

7) Which employees run which parts of the system?

• Which employees can implement and monitor a litigation hold?• Which employees have the ability to modify ESI that needs to be

preserved?• What is the best method to communicate the requirements of the

litigation hold to the relevant employees?

8) Is meta-data routinely “scrubbed” or are documents saved in a uniform image format (.pdf or .tiff)

Electronic DiscoveryLitigation Hold

II) After understanding potential ESI issues, an employer “must suspend its routine document retention/destruction policy and put in place a ‘litigation hold’ to ensure the preservation of relevant documents.” Pension Committee of the University of Montreal v. Bank of America Securities, 685 F.Supp.2d 456 (S.D.N.Y. 2010).

Note: Many employers purge e-mails after 30, 60, or 90 days. Such auto-delete policies need to be turned off.

Employers should also disable an individual e-mail user’s ability to control auto-purge settings.


Issuing a litigation hold:

•Litigation holds should be specifically tailored to case issues and key players in a dispute.

•Think of a litigation hold as an insurance policy to protect yourself against the possibility of sanctions for spoliation of evidence.

•A litigation hold should balance a company’s needs to continue with its operations with its duties to preserve relevant ESI.


Sample Portion of a Litigation Hold:

MANDATORY DOCUMENT RETENTION NOTICE

This notice suspends the Company’s general Document Retention Policy & Procedures concerning all documents described below, which must be retained in connection with the matter John Doe v. The Company. The Company is implementing a mandatory document retention requirement to preserve documents that may be relevant or related to this matter. Please review this memorandum carefully and adhere to the mandatory document retention policy outlined herein. This notice supersedes any other Document Retention Notice received regarding this matter.


A litigation hold should contain provisions that:

1) Require the recipient to distribute the hold to all individuals who have potentially relevant documents;2) Clearly explain that the litigation hold supersedes all other document retention or destruction policies;3) Describe the documents that the litigation hold extends to, indicating that “documents” includes all records stored electronically; and4) Explain that employees should, when in doubt, preserve ESI.

A litigation hold should also:

1. Be periodically reissued, to ensure employees are aware of it;2. Use plain language, for easy understanding; and3. Describe specific ESI to which it applies, taking into consideration any company specific programs or jargon used by the company.


Employers may also:

•Hold a meeting with its employees to discuss the litigation hold;

•Issue the litigation hold notice to third parties (i.e., IT companies);

•Warn employees that trying to “help” the company by deleting “bad” evidence will not assist the company;

•Emphasize that violations of the litigation hold will result in termination;

•Remind employees that any deletion efforts on their part are futile and will create an electronic trail that can be unveiled; and

•Discuss the continuing obligation to adhereto the litigation hold with departing employees during exit interviews.

Electronic DiscoveryWhat Happens Next?

Even where an employer violates the duty to preserve, sanctions will still hinge upon the plaintiff’s ability to show:

1)A culpable state of mind by defendant:

•Destruction may equate to negligence or bad faith. Many jurisdictions require a showing of bad faith to award sanctions.

2)That he/she has been prejudiced by the defendant’s actions/inactions:

•Courts typically presume prejudice in the absence of documents.•When documents are later recovered, courts often will find that the plaintiff is not prejudiced.

Electronic DiscoveryWhat Happens Next?

Establishing the culpable state of mind of the defendant and

prejudice is heavily fact-intensive, which will vary depending on the circumstances of each case.

Ultimately, more severe sanctions are awarded when a plaintiff can show that a defendant, in bad faith, knowingly destroyed documents.

Negligent behavior (e.g., not issuing a litigation hold) will more often result in less severe sanctions, such as adverse inference jury instructions.

Electronic DiscoveryWinding Down

When does an employer end the litigation hold?Obviously, the end of the litigation marks the end of the preservation, but when is the end of litigation? At the end of discovery? Trial? All appeals?

As the answer is often unclear, it is advisable for the parties only to end a litigation hold upon mutual agreement that their respective preservation duties have ceased. When in doubt, employers should maintain the hold.

Once a litigation hold is over, an employer should notify all individuals subject to the hold that their preservation obligations are over. The employer should then instruct its IT department to reinstitute its normal retention policy.

Gregory A. Hearing, Esq.

Thompson, Sizemore, Gonzalez & Hearing, P.A.201 N. Franklin Street, Suite 1600

Tampa, FL 33602

[email protected](813) 273-0050

Hearing - How to lose an unloseable employment law case

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