As part of preparing for potential discovery obligations, many companies have implemented processes, policies, and technology to preserve potentially relevant information. Companies adopt these measures in order to demonstrate that “reasonable steps” were taken to preserve such information and to avoid the threat of sanctions under Federal Rule of Civil Procedure 37(e) should something go wrong and information is lost. What happens, though, if information is lost because of a rogue executive subverting the company’s preservation efforts? Can the company still face sanctions under recently amended Rule 37(e)? In a recent decision from Delaware, the answer to this question was a resounding “yes,” as, due to a rogue executive’s misconduct and some questionable follow-up efforts by the company itself, a district court imposed what are arguably the most severe sanctions seen in a decision since the enactment of the amended rule.
‘GN Netcom v. Plantronics’
In GN Netcom v. Plantronics,1 defendant Plantronics, accused of monopolizing the headset market, instituted a legal hold in response to a demand letter from plaintiff GN. Plantronics issued the hold to impacted employees, hosted training sessions to ensure compliance, and distributed quarterly hold reminders. Nevertheless, a senior executive, allegedly a key participant in the activities giving rise to the underlying antitrust claims, repeatedly responded to email messages he found inappropriate and potentially damaging by instructing everyone to delete the messages. The executive and some of the other employees did indeed delete email messages; the executive went so far as to “double delete” potentially relevant messages—first from his mailbox and then from his deleted files folder—to ensure their destruction.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]
