As new technologies emerge and difficulties in the discovery process of electronically stored information rise, the Federal Rules of Civil Procedure fails to provide an effective solution. This blog series discusses the proposed amendments to the rules of discovery and analyzes whether these amendments will be effective.
Proposed Amendment to Rule 37(e)
Rule 37 deals with failures to make disclosures during discovery, failures to cooperate during discovery, and subsequent sanctions.21 Rule 37(e) currently states that “[a]bsent exceptional circumstances, a court may not impose sanctions . . . on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system.” The proposed amendments to Rule 37(e) will limit adverse inferences and sanctions for the spoliation of evidence to circumstances in which the moving party can show that the responding party’s acts to destroy evidence “(i) caused substantial prejudice in the litigation and were willful or in bad faith; or (ii) irreparably deprived a party of any meaningful opportunity to present or defend against the claims in the litigation.”
These proposed amendments raises the question: how can the moving party prove the benefit or necessity of missing information? As Judge Scheindlin of the United States District Court for the Southern District of New York so eloquently expressed in her opinion in Sekisui American Corp. v. Hart,
[t]o shift the burden to the innocent party to describe or produce what has been lost as a result of the opposing party’s willful or grossly negligent conduct is inappropriate because it incentivizes bad behavior on the part of would-be spoliators. That is, it “would allow parties who have destroyed evidence to profit from that destruction.”
In Sekisui, the plaintiff corporation destroyed the ESI of at least two custodians, one of whom was the defendant-former-employee in the action. In Sekisui, “[i]t [was] impossible to say how many emails were permanently deleted and remain unrecoverable.” Through the plaintiff corporation argued that “the missing emails would be of only marginal relevance in th[e] action,” there is no way for the defendant-former-employee to counter such argument without knowing the contents of the deleted ESI. As the court noted, so long as relevant evidence was destroyed with a culpable state of mind, which requires only that the “evidence was destroyed knowingly, even if without intent to [breach a duty to preserve it], or negligently,” the burden to prove prejudice of that destruction should rest with the culpable party.
Importantly, counsel must now advise their clients that destroying evidence is risky, as the burden is on the destroying party to prove good faith. As it stands now, “each party [bears] the risk of its own negligence.” If the burden shifts to the innocent party to show prejudice or harm, some potential spoliators may be less fearful of deleting evidence as the burden would be on the innocent party to prove its contents. Imagine the party who stumbles upon very harmful evidence, but destroys it knowing that the opposing party could never prove the value of its contents. The amended Rule inadvertently protects this bad actor.
In sum, amending Rule 37(e) to shift the burden of proof to the innocent party is problematic. The Committee has yet to explain or proffer a reason why these amendments are beneficial or necessary.
Overall, these amendments do not seem to be of significance in their present form. With additional comments and explanation, they could be useful to the bench and bar in refining the understanding of the above Federal Rules.