Risk, Reduce, Avoid.jpgI am presenting a Webinar titled E-discovery Tips for Winning Employment Cases, on May 31, 2012. One of the main problems the presentation addresses is reducing the difficulty employers experience when it comes to meeting their preservation obligations in response to employment litigation. However, with various regulations, record keeping requirements and creative lawyers, this is becoming easier said than done. 

A recent federal district court case, Grabenstein v Arrow Electronics, Inc. (PDF), highlights one aspect of this difficulty. In that case, the plaintiff claimed that the defendant former employer failed to accommodate her disability and that it discriminated against her because of that disability by terminating her employment. Plaintiff further argued in her motion for sanctions that the former employer’s obligation to preserve electronically stored information (emails) arose long before the employer had notice of the claim. 

More troubling for employers, the court agreed, finding essentially that the defendant’s obligation to preserve e-mails did in fact exist before the employer had notice of the eventual litigation, e.g., before Plaintiff was fired, before Plaintiff filed her Charge of Discrimination with the Equal Employment Opportunity Commission (EEOC), and before the defendant employer received notice of the Charge of Discrimination from the EEOC. 

Overview of Spoliation

Before getting into the Grabenstein, case, it is important to understand what spoliation of evidence refers to; Spoliation is generally defined as the destruction or significant alteration of evidence, or the failure to preserve property for another’s use as evidence in pending or reasonably foreseeable litigation. One requirement for a sanction order to be proper is that the party had a duty to preserve evidence because it knew, or should have known, that litigation was imminent.  

When is the Preservation Trigger Date

A central issue in a spoliation claim is when a party’s obligation to preserve evidence arose. In the Grabenstein case, as with most cases, plaintiffs seek to move back the date triggering the employer’s duty to preserve as early as possible in order to bring into play potential sanctions. Here, the plaintiff argued that the former employer was obligated to preserve the e-mails in question even before it had notice of impending litigation, pursuant to a record keeping requirement under 29 C.F.R. § 1602.14, and that failure to adhere to its obligation was grounds for a spoliation inference.

In sum, 29 C.F.R. § 1602.14 “requires an employer covered by [the ADA] to retain all personnel records for [one year] after they are created and, when a charge of discrimination has been filed against the employer, to retain all records relevant to the charge until the dispute is resolved.” 29 C.F.R. § 1602.14.

The Court agreed, noting that where a party has violated an EEOC record-retention regulation, a violation of that regulation can amount to a breach of the duty necessary to justify a spoliation inference in an employment discrimination action. Accordingly, the Court found that the Defendant violated its obligation to retain portions of Plaintiff’s “personnel or employment record(s)” pursuant to 29 C.F.R. § 1602.14 when it deleted e-mails relating to her entitlement to disability benefits.

Pulling the Trigger for Preservation – No Harm if the Plaintiff is Shooting Blanks  

The Court eventually decided that sanctions were unjustified for various reasons. The most important reason for employers, however, is that Plaintiff provided no evidence that the e-mails were destroyed in bad faith, in part, because there was no evidence to show that the e-mails were destroyed other than in the normal course of business pursuant to the defendant employer’s e-mail retention policy.

Advance Planning is Key to Meeting Preservation Obligations 

The E-discovery Tips for Winning Employment Cases webinar on May 31, 2012, will discuss in more detail steps employers should take to properly identify the trigger date for preserving employment related evidence, as well as what steps should be taken to minimize the risks if that trigger date is missed.

Briefly, however, it is absolutely critical for an employer to have in place an appropriate record retention policy, that is consistently followed, and includes a means for suspending the retention policy in response to actual or possible litigation. This is because such a policy and documented procedures for suspending that policy puts the employer in a position to demonstrate any emails or other evidence lost was not due to bad faith, which is generally required to impose an adverse inference or other sanctions.