The amended version of Rule 37(e) of the Federal Rules for Civil Procedure was intended to narrow the latitude that courts have when imposing sanctions on a company for failing to preserve electronically stored information required for discovery in a lawsuit. In light of that, some observers find it surprising that on July 12 the U.S. district court in Wilmington, Delaware slapped Plantronics with as harsh a penalty as it did—a $3 million fine—based on an estimated thousands of deleted e-mails that were likely relevant to the plaintiff’s antitrust allegations against Plantronics.
The impetus for the Advisory Committee appointed by the U.S. Supreme Court to update the Federal Rules of Civil Procedure was “concern that the burden and expense of discovery were making it difficult for cases to be heard on the merits,” says Christopher Boehning, a partner at Paul Weiss Rifkind Wharton & Garrison, who has written extensively on e-Discovery and Rule 37(e) in the New York Law Journal. Regarding Rule 37(e), the inconsistency [or disparity] in penalties imposed in different federal circuits “made it very difficult for multinationals or even just companies that operate in many jurisdictions in the United States to set an appropriate [data] preservation policy with some confidence that they wouldn’t be subject to sanctions.” In the second circuit (covering New York, Connecticut, and Vermont), for example, “simple negligence was sufficient for even the most serious sanctions like an adverse inference [case-terminating sanctions], whereas in other circuits a showing of bad faith or an intent to deprive your adversary of the documents was required before the most severe sanctions could be imposed,” he says.
