In Experience Hendrix, LLC et al. v. Pitsicalis et al. (S.D.N.Y. Nov. 27, 2018), the court ruling demonstrates the (rather obvious) lesson: if you don’t produce and then take multiple steps to hide relevant data, in most instances the court will issue significant e-discovery sanctions against you.
Overview
In this copyright infringement case, the plaintiffs motioned for e-discovery sanctions against the defendant for a variety of misconduct including spoliation and hiding evidence.
The defendants, including Jimi’s brother, started a marijuana business and were attempting to use Jimi Hendrix’s image to sell their products. The estate of Jimi Hendrix, the plaintiffs, challenged the use of Jimi’s image, and within e-discovery, there were numerous incidents of “non-compliance with basic discovery obligations” by the defendants, which included:
- Failure to produce forensics images as ordered
- Deletion of relevant text messages
- Using anti-forensic software to delete relevant files
After three court orders and continuing failure of the defendant to produce all relevant data, the plaintiffs motioned for case dismissal or an adverse inference jury instruction.
Ruling
- Sanctions Granted in Part. The court ruled against the defendant by issuing an adverse inference instruction and ordered them to pay fees and costs to plaintiffs in bringing the motion. However, the court declined to terminate the case or issue an injunction against the defendants.
- Repeated Misconduct by Defendants. The court ruled that defendants “overwhelmingly” breached their duty to preserve data by using anti-forensic software, failing to produce relevant evidence and deleting text messages,
- Intent Found. The use of anti-forensic software was evidence to the court that the defendants acted with an intent to deprive, opening up the door for an adverse inference instruction.
Expert Analysis from David Cohen, Chair of the E-Discovery Group, ReedSmith LLP
A litigation party’s use of specialized anti-forensic or deletion software on files likely to contain relevant information will almost always provide courts with a sufficient basis to find an “intent to deprive another party,” opening the door to imposing on the offending party the severe sanctions permitted under FRCP 37(e)(2).
Case Law Tip
Find out all about the top 10 e-discovery case rulings from 2018 in Exterro’s recent white paper.
