“How Corporate Lawyers Made It Harder to Punish Companies That Destroy Electronic Evidence”

How Corporate Lawyers Made It Harder to Punish Companies That Destroy Electronic Evidence” —

  • “In the early 2000s, a series of civil lawsuits against giant corporations illustrated the disastrous consequences that could ensue if a defendant failed to provide electronic evidence such as company emails or records.”
  • “Big corporations rallied for changes and got them. In 2006, the rules that govern federal litigation were changed to create a ‘safe harbor’ that would protect companies from consequences for failing to save electronic evidence as long as they followed a consistent policy and, when put on notice of imminent litigation, preserved all relevant materials.”
  • “They successfully advocated for a rewritten rule, which took effect in December 2015, that sharply limited judges’ latitude to punish those who destroy electronic evidence. The rule requires that a litigant who claims that the other side destroyed or didn’t keep evidence prove that it would have been unfavorable to the evidence-destroyer, and that they didn’t preserve it purposefully to cover up illicit activity.”
  • “The change to the provision — its official designation is Rule 37(e) of the Federal Rules of Civil Procedure — came after a five-year lobbying campaign by a coalition of corporate defense attorneys and the U.S. Chamber of Commerce.”
  • “The review showed that in 2014, the year before the new rule took effect, federal judges approved 51% of motions to penalize one side by instructing a jury to hold the absence of the evidence against it or even direct a judgment in favor of the victimized side. In 2019, that figure dropped to 19%.”
  • “Corporate advocates argued that they were being penalized too much for inadvertently losing materials, that it was too costly to preserve vast quantities of electronic evidence and that federal judges had too much discretion in determining the penalties. The latter resulted in different standards in different parts of the country. ‘The burden of over-preservation grows heavier by the day,’ contended a letter written by Microsoft’s in-house attorneys in 2011 that was viewed as a rallying cry by corporate lawyers. ‘Explicit standards and limitations will address the problem.'”