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Spoliation "schocks the conscience": blistering sanctions in  wage and hour class action

Jeffrey Wolff
Oct 21, 2014 11:16:51 AM

The spoliation of evidence is the intentional or negligent withholding, hiding, altering, or destroying of evidence relevant to a legal proceeding. The goal of spoliating or tampering with evidence is usually to cover up evidence that would be unfavorable to the perpetrator in some way. However, in the case of UMC’s class action suit for unpaid compensation, it is unclear whether its evidence handling is due to incompetence or an effort to destroy and cover up evidence.

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Malice or incompetence? 

Special Master Daniel B. Garrie thinks it’s the latter. According to Garrie, in his 78-page report to U.S. District Judge Andrew Gordon in Las Vegas, "The level of intentional destruction of evidence by UMC shocks the conscience. UMC's actions and willful failure to comply with the court's orders has ... made a mockery of the orderly administration of justice."

According to Garrie’s report, very basic electronically stored information (ESI) was not discussed, disclosed, preserved or produced. This included some custodian email, shared drives and home drives.

More complex ESI included:

  • company issued smart phones
  • personal smart phones used in a BYOD way
  • time keeping systems for electronically punching in and out of work
  • the Blackberry server and
  • database systems.

Preservation of information was a whisper in passing in the hallways. Legal hold notices were not issued in writing, there was no data map and the intranet holding the policies and procedures was not preserved.

The 78-page report recounted in painful detail the incomplete collections and productions by eDiscovery consultants and attorneys using a variety of tools.


Possible sanctions

Special Master Garrie recommended that the sanction for destroying evidence be class certification and rebuttable presumptions for a set of facts that will become case dispositive. Garrie’s recommendations use the current spoliation rules to justify the harsh sanction, and did not require the requesting party to prove “prejudice” and “intent to deprive” as proposed amendment to the FRCP 37(e) requires.

Most perniciously UMC’s actions make it impossible to know the degree of prejudice Plaintiffs have suffered.

Unsurprisingly, UMC’s counsel, Lewis Brisbois (brought in to clean up the mess), countered with a strong rejection of Garrie’s report, and requesting a de novo review of the record. With stakes described as “defendant dispositive” and not merely case ending, UMC rejects Garrie’s report:

To summarize in rough categories, an examination of the record shows many instances where Special Master Garrie was blatantly wrong; made dubious inferences, many premised on mistaken information; and elevated opinion and speculation into so-called factual findings without the ballast of analysis to support them. Based on these shaky foundations, UMC submits that Special Master Garrie proceeded to simply castigate UMC for supposed wrongs that Special Master Garrie was actually hired to investigate and work though with the parties.

Where Garrie castigated UMC with reports summarizing the text messages, the number of files lost and procedural errors, UMC counters by indicating that Garrie documented incorrect citations, disputed facts and law and an allegation of loss of neutrality. Instead of getting help sorting out the issue, UMC argues, the hospital "was sent straight to its room with no supper for supposed wrongs committed…. This egregious result needs to be corrected."

It will be up to Magistrate Judge Peggy A. Lee to consider who is right and depending on her findings, the Hon. Andrew P. Gordon presiding over the case, may need to rule.

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