When Does the Duty to Preserve Electronic Evidence Arise?

The duty to preserve electronic evidence is triggered once a party “reasonably anticipates” litigation. Silvestri v. GMC, 271 F.3d 583, 591 (4th Cir. 2001);  Pension Committee of the Univ. of Montreal Pension Plan v. Banc of Am. Securities, LLC, 685 F. Supp. 2d 456, 466 (S.D.N.Y. 2010). At that point, parties have an obligation to suspend their routine document retention and destruction policies and implement a “litigation hold” to safeguard all relevant evidence.  The United States Court of Appeals for the Federal Circuit recently reaffirmed the “reasonably foreseeable” standard in Micron Tech., Inc. v. Rambus, Inc., No. 09-1263, 2011 WL 1815975 (Fed. Cir. May 13, 2011). The Court of Appeals explained that the standard is an objective one, “asking not whether the party in fact reasonably foresaw litigation, but whether a reasonable party in the same factual circumstances would have reasonably foreseen litigation.” Id. at *6.  Significantly, the Court in Micron rejected the argument that “litigation be ‘imminent, or probable without significant contingencies’” in order to trigger the duty to preserve. Id. According to the Court, this argument is based on “an overly generous reading of several cases” and is at odds with the flexible reasonably foreseeable standard.  Id. 

The “reasonable anticipation” principle is now well-established but not easily applied as it is necessarily shaped by the factual nuances of the parties’ dispute. Thus, although it is easy to conclude that a defendant has a duty to preserve electronic evidence once it is served with a summons and complaint, the duty to preserve is often triggered in the pre-litigation stage. This is because the duty to preserve is triggered once the defendant is aware of a credible threat of litigation, which is often before a complaint is filed. Determining the date that the party knew or should have known that litigation is reasonably foreseeable is often a subject of dispute. Viramontes v. U.S. Bancorp, No. 10-761, 2011 WL 291077 (N.D. Ill. Jan. 27, 2011).


Some guiding principles, however, are clear. For large organizations, it is clear that more than one or two employees must reasonably anticipate litigation in order to trigger the duty. Zubulake v. UBS Warburg LLC, 220 F.R.D. 212, 217 (S.D.N.Y. 2003). Thus, in Toussie v. County of Suffolk, No. 01-6716, 2007 U.S. Dist. LEXIS 93988 (E.D.N.Y. Dec. 21, 2007), the Court reasoned that the duty to preserve electronic evidence did not arise until the complaint was filed. The Court reasoned that, although a “handful” of employees expected the plaintiffs’ lawsuit, “there was no evidence to suggest that a substantial number of key personnel anticipated litigation prior” to such time. In Viramontes, the fact that the plaintiff’s supervisor suspected that the plaintiff might sue, based on a pre-litigation letter written by the plaintiff complaining about the supervisor’s allegedly rude behavior, was not enough to find that the defendant-company should have reasonably anticipated future employment discrimination litigation. 2011 WL 291077 at *4. The court reasoned that the letter did not assert that the plaintiff might bring employment discrimination claims and, in fact, it suggested a “non-litigious resolution” to the plaintiff’s complaints regarding her supervisor’s behavior. Id. Furthermore, the plaintiff’s claims under the Americans with Disabilities Act and the Family and Medical Leave Act were not filed until ten months later. 


The indications that litigation may be forthcoming must be more than “vague” statements and the “mere existence of a dispute does not necessarily mean that parties should reasonably anticipate litigation[.]” Goodman v. Praxair Servs., 632 F. Supp. 2d 494, 510 (D. Md. 2009).  Thus, a demand letter may be a sufficient warning that litigation is on the horizon and a letter advising that an attorney has been retained will certainly trigger the duty to preserve. Id. at 511. Conversely, letters written in the midst of the parties’ dispute do not necessarily trigger the duty. In Cache La Pourdre Feeds, LLC v. Land O’Lakes Farmland Feed, LLC, 244 F.R.D. 614, 622 (D. Colo. 2007), a letter stating that its purpose was to put the defendant on notice of the plaintiff’s trademark rights and “determine whether this situation can be resolved without litigation” did not trigger a duty to preserve. These cases demonstrate that the determination of the trigger date on the duty to preserve is a fact-intensive inquiry.


Also of note is the inter-relationship between the timing of the duty to preserve and application of the work product privilege. In Siani v. State Univ. of New York at Farmingdale, No 09-407, 2010 WL 3170664 (E.D.N.Y. Aug. 10, 2010), for example, the plaintiff argued the defendant had a duty to preserve evidence a full year prior to the filing of the complaint because the defendant retained a law firm at that point to represent it in connection with the plaintiff’s allegations of ongoing discrimination. The defendant was hard-pressed to argue to the contrary given that it had marked documents as protected by the work-product privilege around that same time. Id. at *5. The Court reasoned that the “commonsense conclusion” dictated that if “litigation was reasonably foreseeable for one purpose in January 2008, it was reasonably foreseeable for all purposes.” Id. 


In conclusion, whether and when a party reasonably anticipates litigation, thereby, triggering the duty to preserve electronic evidence depends on many factors, including but not limited to, who within the defendant organization anticipates the litigation, the clarity of the threat, and when privileged documents are created and labeled as such. A reasoned evaluation of all factors is needed and the organization is under a duty to re-evaluate should new information present itself.

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