Your business document retention practices may come into unwanted scrutiny in a lawsuit, with consequences that shift the odds against you.
Among your emails to and from your company email address, your wastepaper baskets, the files in your desk, the files in the metal cabinets down the hall, the texts on your company iPhone, the archive of that pdf scanner attached to your copy machine, the archive of your fax machine and the emails that you have forwarded from your company email address to your home email address so you can work on them at home – there is much information for an adversary to discover should you one day find yourself facing an adversary who, in accordance with litigation principles, serves you with requests for production of documents.
Even before any lawsuit looms, it is important to have adequate document retention protocols in place. Should a document or email or text, or what have you, not be produced during discovery, but its existence is made known through the discovery of other documents, you run the risk of a spoliation charge.
Spoliation, as described in a Maryland Court of Special Appeals in a 1985 case, is the “the destruction, mutilation or alteration of evidence by a party to an action.” The duty to preserve material evidence arises not only during litigation, but to the period of time before litigation when a party reasonably should know that the evidence may be relevant to anticipated litigation. The consequences of spoliation of evidence outlined in that case, and followed since by Maryland courts states:
The destruction or alteration of evidence by a party gives rise to inferences or presumptions unfavorable to the spoliator, the nature of the inference being dependent upon the intent and motivation of the party. Unexplained and intentional destruction of evidence by a litigant gives rise to an inference that the evidence would have been unfavorable to his cause, but would not in itself amount to substantive proof of a fact essential to prove his opponent’s case.
For a court to impose spoliation sanctions, four elements must be shown by the non-spoliating party: 1) an act of destruction; 2) discoverability of the evidence; 3) an intent to destroy the evidence; and 4) occurrence of the act at a time after suit has been filed, or, if before, at a time when the filing is fairly perceived as imminent. For the third element – intent – no showing of fraudulent intent is needed.
Maryland case law is makes clear that the adverse presumption will rise against the spoliator so long at intent to destroy evidence is present, for whatever reason. Intent need not indicate bad faith or knowing destruction but includes gross or ordinary negligence. In other words, carelessness about storing and producing your information may be sufficient to prove spoliation intent and invite sanctions.
Should you have any questions regarding the sufficiency of your document and information retention policies and protocols in the ever-shifting landscape of information (remember that glossy rolled fax machine paper?), please give us a call.
For more information please contact Gary Almeter at 410-583-2400 or firstname.lastname@example.org.