I was busy reviewing and digesting case law today for the eDiscovery Assistant app scheduled for release later in June (cue that “applause” sound effect on your phone), when I came across a beauty of an instructive case that I simply had to talk about — Pillay v. Millard Refrigerated Servs., Inc., 2013 WL 2251727 (N.D. Ill. 2013). Those of you who read this blog regularly know that I don’t write about eDiscovery case law that regularly because 1) there’s a lot of it and I wouldn’t have time to do any work, and 2) it’s hard to make it a fun read all the time, and generally that’s my mission in life.
So, why this case? Well, because it highlights an issue that I think comes up a lot more than most lawyers would ever care to admit — and Millard got bitten by it big time here, so it’s the perfect illustration for my point.
What’s the point you ask? You need to have someone who is used to thinking about the types of ESI that could be implicated in a case at the outset of a matter so that all potential sources of ESI can be preserved. That sounds simple, I know. But are you that person? Doesn’t look like Millard had that person here.
Let’s look at the case. The plaintiff, Samson Pillay, filed suit against defendant Millard, his former employer, for retaliation after he opposed MIllard’s decision to terminate another employee, Ramirez. Pillay alleged that Millard fired Ramirez for a disability; Millard said it was for performance. When Pillay didn’t back up Millard, he was allegedly fired too. (The opinion doesn’t actually tell us what Pillay did at Millard, so it’s hard to know what his role was in the process that allegedly led to his termination. This was just an opinion on the motion for sanctions.)
After being fired, Pillay retained counsel who filed a complaint with the EEOC, and sent not one, but two separate letters to in-house counsel at Millard telling them to preserve data. (Incidentally, those were sufficient for the court to find that Millard was on notice that litigation was imminent and therefore required to preserve relevant information.) At the EEOC, Millard relied directly on data from its Labor Management System (“LMS”), a structured database that records data about each employee in the warehouse (hours worked, days, time in and out), to say that it terminated Ramirez based on performance, and not a disability. In fact, Millard specifically introduced evidence of Ramirez’s performance (hours worked in a week) taken from data in LMS.
Here’s where the lesson comes in — although they directly relied on data from the database, Millard didn’t preserve the relevant data or provide it to the other side. Instead, they let the LMS system automatically delete the underlying data as part of its routine process. Holy Crap. Can you imagine having been the lawyers on that case for Millard?
Now, we eDiscovery geeks know that you can sometimes seek “safe harbor” in Rule 37 for the good faith, routine operation of your IT systems. It’s another story again when you rely on data directly from a system and then let it routinely delete the very data that the other side needs to be able to argue its case. There’s no safe harbor for that, I’m afraid.
From experience, I know that there are a likely a number of things that happened here (but I’m not clairvoyant):
- Outside counsel or in-house counsel did work with witnesses to preserve information (just not all of it)
- Nobody thought about the fact that the database might overwrite or be deleted at any point
- Nobody thought to ask IT what the process was for the database deleting data through its routine operation or whether steps needed to be taken to preserve that info
- In-house counsel counted on outside counsel to be in charge and (to use a phrase I hear from in-house counsel all the time) “on top of these issues”
- It never occurred to anyone to provide a database of information to the other side — who does that anyway? (In truth, no one, but we do provide snapshots or the specific information that is relevant, ALL THE TIME)
Now, to add insult to injury, plaintiff also managed to find an email exchange between the Millard plant manager and the senior VP of HR discussing that Ramirez had a prior work injury that gave him a disability rating of 17.5% with the Illinois Industrial Commission. The VP responded to the exchange by saying: “We have this all documented right? … Let’s get him out asap.” Millard terminated Ramirez very shortly thereafter.
Did you just feel a metal door slam shut and lock? Me too.
So, what happened? Adverse inference instruction, baby. The court undertook a detailed review of case law related to bad faith and the required culpability to warrant an adverse inference instruction — willfulness, bad faith or fault. And, although the court never went so far to say Millard acted in bad faith, it was at fault, and as such, had the required culpability for the instruction. Because plaintiff was not able to use the deleted data to disprove Millard’s argument, he was sufficiently prejudiced and the court ordered 1) that it would give the pattern jury instruction for adverse inference and 2) instruct the jury on the standards for reckless conduct and bad faith outlined in the instruction. OUCH.
Avoid the holy crap moment. Make sure you have somebody on your litigation team at the outset that knows what they are doing when it comes to identifying sources of ESI and preserving data. Somebody that does it for a living — not somebody that you hope is “on top of those issues.” Because they aren’t and you don’t want to find out the hard way. It won’t be pretty.