By John Alan Doran

An employer may be held responsible for failure to preserve e-mails and other electronic documents relevant to anticipated litigation. That’s the message from a federal judge in Arizona, in Kenneth Day v. LSI Corporation, No. CIV 11-186-TUC-CKJ(2013). Day alleged that LSI lured him to work for it using various false promises about job title, stock options, and much more, only to harass and constructively discharge him. During the lawsuit, Day asked for a substantial amount of electronic discovery from LSI. However, after receiving Day’s demand letter, LSI’s in-house lawyer did not take steps to fully preserve data related to some of the claims. As a result, much of that electronic data, including emails from and to Day’s supervisor, was destroyed under LSI’s standard data retention/destruction policies. LSI also failed to preserve internal instant messages.

Day asked the court to impose draconian sanctions against LSI. The court agreed and imposed three sanctions: (1) the court entered judgment in favor of Day and against LSI on Day’s stock option claim; (2) while Day’s remaining claims would still go to a jury, the court would instruct the jury that LSI deliberately destroyed evidence; and, (3) the court ordered LSI to pay $10,000 in attorneys’ fees to Day. The court also took pains to note that employers who use instant messaging to carry out personnel policies or decisions must preserve their instant messaging database, although LSI was not sanctioned for failing to do so in this case.

Electronic discovery is serious, time-consuming, and costly business. Someone in house, often in-house counsel, will be the first person responsible for collecting and preserving this data. Failure to stop routine destruction of ephemeral data, like instant messages, can result in sanctions and lose the case. For want of a nail, . . . the battle was lost.