Forensic Update

Reflections on information management within the legal and regulatory arena

Jail Time for eDiscovery shenanigans? Believe it…

Posted by Johnny Lee on September 22, 2010

eDiscovery Jail TimeIn a development that is sure to send a shock wave through the Electronic Discovery (“eDiscovery”) and Litigation communities, Magistrate Paul Grimm (United States District Court of Maryland) issued a court order recommending potential prison time for an especially egregious case of eDiscovery mismanagement.  Specifically, Judge Grimm’s order (q.v., Victor Stanley Inc. v. Creative Pipe, Inc. court order) issued on September 9th, found that the defendant’s mishandling of Electronically Stored Information (“ESI”) was tantamount to a “pervasive and willful violation of serial Court orders to preserve and produce ESI evidence” and that, as such, the behavior shall be treated as contempt of court.

To be clear, Judge Grimm recommended imprisonment “unless and until [the Defendant] pays to Plaintiff the attorney’s fees and costs that will be awarded to Plaintiff as the prevailing party.”  Just the same, this is a clarion call from the courts to sanction severely for evidence spoliation and for what appears to be a willful disregard of a series of discovery requests and court orders.

As with the Qualcomm Inc. v. Broadcom Corporation case from late 2007, the presiding magistrate judge found exceptionally bad mismanagement of ESI to warrant a substantial sanction.  There, the magistrate judge ordered Qualcomm to pay a portion of Broadcom’s attorney fees, and the judge referred six Qualcomm attorneys to the California State Bar for review and possible disciplinary sanctions.

We see two things in Judge Grimm’s recent court order.  First, we see further evidence of a “no nonsense” policy stance being adopted by federal courts relative to evidence spoliation and inadequate attorney oversight into the eDiscovery process.  Second, we see perhaps the case law “tipping point” that provokes organizations to elevate eDiscovery mismanagement as a serious enough enterprise risk to warrant genuine investment in their litigation readiness strategies and programs.  One thing is certain: Things just got a lot more interesting for those monitoring (and participating in) the case law in this space…stay tuned!

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2 Responses to “Jail Time for eDiscovery shenanigans? Believe it…”

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