By Memorandum Opinion entered by The Honorable Leonard P. Stark in GN Netcom, Inc. v. Plantronics, Inc., Civil Action No. 12-1318-LPS (D.Del., July 12, 2016) (redacted), the Court granted in part Plaintiff's Motion for Sanctions arising from the deletion of emails by a senior executive of Defendant who was responsible for all domestic sales functions and ultimately responsible for the execution and implementation of the Plantronics Only Distributor ("POD") program and agreements which are the focus of the claims asserted in the antitrust action. The record contained evidence that, after the filing of the lawsuit and despite Defendant promptly issuing a litigation hold to relevant employees upon receiving Plaintiff's demand letter, updating the litigation hold after the lawsuit was filed, providing training sessions and sending quarterly reminders to ensure compliance, the senior executive of Defendant deleted certain emails that should have been preserved in the anticipation or conduct of litigation, instructed others in the company to delete certain emails, and Defendant otherwise engaged in spoliation of electronically stored information ("ESI"). Id. at * 1-18. The Court found that (1) Defendant, due to its senior executive's deletion of emails and his instructing others to delete certain emails, failed to take reasonable steps to preserve ESI which cannot be restored or replaced; (2) Defendant did so in bad faith with the intent to deprive Plaintiff from using the information contained in the emails; and (3) Plaintiff is prejudiced by the loss of the emails. Id. at *18-26.
The Court next evaluated the appropriate sanctions to impose and decided to impose against Defendant the following: (1) monetary sanctions in the form of the reasonable fees and costs incurred by Plaintiff in connection with the spoliation disputes; (2) punitive sanctions in the amount of $3 million dollars; (3) possible evidentiary sanctions during trial, if requested in the future by Plaintiff and found by the Court to be warranted; and (4) sanction instructions to the jury that it "may" – as opposed to that it "must" – draw an adverse inference that emails destroyed by Defendant would have been favorable to Plaintiff's case and/or unfavorable to Defendant's defense. Id. at *26-30.
A copy of the redacted public version of the Opinion is attached.
Of particular note is the fact that, in rendering its ruling in the Opinion, the Court applied Federal Rule of Civil Procedure 37(e) as revised by the December 1, 2015 amendment.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
