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By Michael Berman, Esq.

Fowler v. Tenth Planet, Inc., 2023 WL 2691576 (D. Md. Mar. 29, 2023)(Coulson, J.), is an important and thoughtful decision demonstrating the peril of preservation in place.

In Fowler, the plaintiff left his cell phone in an unlocked car.  It was stolen after the duty to preserve had been triggered.  It contained relevant text messages, but it had not been backed up.  The defendant sought sanctions.

The Court analyzed Fed.R.Civ.P. 37(e) in detail and set out guidelines explaining when preservation in place may or may not be permissible.  Because defendant sought game-ending sanctions, and because the Court found only negligence, the Rule 37(e)(2) motion was denied.  The Court left the door open for lesser sanctions at trial under Rule 37(e)(1).

Two takeaways are clear –

  • the Court said that preservation in place may be acceptable in some instances; and,
  • preservation in place is risky.

“Self-preservation” is the ESI equivalent of “do-it-yourself” home repair.  See  Self-Identification and Self-Preservation: A Fool for a Client?    There is nothing new about it, and its dangers have long been documented.  For example, in Zubulake v. UBS Warburg, LLC, 216 F.R.D. 280, 287 (S.D.N.Y.  2003), “all UBS employees were instructed to save documents relevant to [the] case.” Mr. Matthew Chapin, “Zubulake’s immediate supervisor and the alleged primary discriminator,” however, failed to save a “potentially useful email. . . .” See also Green v. Blitz U.S.A., Inc., 2011 WL 806011 (E.D. Tex. Mar. 1, 2011).

It is tempting, therefore, to conclude that self-preservation is impermissible. However, it is important to recall that all ESI decisions should be governed by concepts of proportionality.[1]

There is ample authority that supports a proportionality analysis in the context of the duty to preserve.  P. Grimm, M. Berman, et al., “Proportionality in the Post-Hoc Analysis of Pre-Litigation Preservation Decisions,”   37 U.Balt.L.Rev. 381, 403 (2008).  Therefore,  primary factors in deciding whether self-preservation is permissible should be the size, value, and needs of the case, and resources of the litigant. See Mancia v. Mayflower Textile Servs. Co., 253 F.R.D. 354, 364 (D. Md. 2008)(discussing a “discovery budget”).

That is what the Court wrote in Fowler.  In Fowler, Plaintiff asserted claims for unpaid overtime wages.  Plaintiff left his cell phone in his car, and it was stolen.  It was not backed up and his text messages were lost.  Defendant asserted that it was bad faith to “fail[ ] to preserve the text messages in a more robust way than simply storing them on his phone….”  In other words, it asserted that preservation-in-place was unreasonable on the facts presented.

It is worth noting that inexpensive preservation methods were available.  See, e.g., Craig Ball, Preserving Android Evidence: Return of the Clones? | Ball in your Court (craigball.net)(Sep. 17, 2019),   iphone | Search Results | Ball in your Court (craigball.net)(Aug. 30,2019), and  Custodian-Directed Preservation of iPhone Content: Simple. Scalable. Proportional. | Ball in your Court (craigball.net)(Jul. 26, 2017).

Nor is it “news” that data on cell phones is within the scope of the duty to preserve: “Today [April 2017], if you fail to advise clients to preserve relevant and unique mobile data when under a preservation duty, you’re committing malpractice. Yes, I used the ‘M’ word, and not lightly.”  Craig Ball, A New Paradigm in Mobile Device Preservation | Ball in your Court (craigball.net)(Apr. 18, 2017).  “[I]t’s quick, easy and free for a user to generate a full, unencrypted backup of a phone without surrendering possession.”  Id.

In Fowler, the plaintiff argued that the missing texts were not important or relevant.

Plaintiff acknowledges that he and Zegna exchanged text messages throughout his employment, but his recollection is that there were no more than ten text messages exchanged; furthermore, Plaintiff contends that any substantive text messages (1) post-dated the May 2019–October 2019 period prior to his promotion to kitchen manager, (2) concerned routine matters like “on-boarding,” (3) did not include other kitchen managers, and (4) were therefore inconsequential to the case.

Additionally, the other party to messages – – Zegna – – had copies of many of the texts, except for a six-month gap.  That gap period was significant.

Plaintiff claimed that he had worked as a “line cook” and was entitled to overtime until he was promoted to “kitchen manager,” an exempt position.  The Court wrote that the “gap period includes the time during which Plaintiff was allegedly employed as a line cook.”

Additionally, plaintiff’s status during the gap period was disputed: “Defendants contend that the missing text messages were the only documentary evidence from the relevant time period and likely would corroborate, in Plaintiff’s own words, Defendants’ assertion that Plaintiff was a kitchen manager—and thus exempt from overtime—during his entire employment.”

The Court explained in detail the purposes of the December 2015 amendment to Fed.R.Civ.P. 37(e).  It then applied the Rule.  Because defendant sought game-ending sanctions, the Court wrote that Rule 37(e)(2) significantly limited its discretion.  It stated that “in the absence of a finding of intent to deprive, [Rule 37(e)(2)] forecloses imposing the sanctions Defendants urge here: dismissal or, at least, an adverse inference instruction coupled with precluding Plaintiff from disputing Defendants’ evidence regarding the content of the missing text messages.”

The Court’s discussion of “preservation in place” is important:

  • “There will be cases where text messages are not central to the dispute such that the reasonable steps to preserve them might be no greater than to refrain from permanently deleting them from one’s phone, as Plaintiff says he did here.”
  • “However, where Plaintiff was on notice that text messages, as the primary form of ‘written’ communication between him and his employer, would be important evidence of the nature and extent of Plaintiff’s job duties at various points during his employment (a central issue in the case), it was not reasonable to simply maintain those text messages only on his phone without at least verifying that they were being backed up to a cloud service or otherwise taking affirmative steps to create a copy given the not uncommon occurrence of a phone getting damaged, lost, or stolen. This is especially so when the data loss occurs well into the litigation, when a party has been represented by counsel, and where, as here, a party is not a stranger to the litigation process and the duties that surround it.”

The Court added: “Ironically, Plaintiff’s counsel himself emphasized the importance of text messages during the time period at issue when criticizing Defendants’ production before Plaintiff’s phone was stolen, yet no steps were taken by Plaintiff to preserve then-existing text messages in his possession from this same time period beyond simply refraining from deleting them from his phone, their sole remaining depository.” [emphasis added].

Fowler v. Tenth Planet, Inc., 2023 WL 2691576 (D. Md. Mar. 29, 2023).

The fact that some of the messages were available from a secondary source was insufficient to preclude sanctions and the Court then turned to the request for game-ending sanctions.

First, it looked at prejudice.  Defendant asserted that the missing texts would firmly establish that plaintiff was a kitchen manager who was exempt from overtime.  It argued that the secondary source messages all supported that position and it was therefore reasonable to assume that the gap messages would have been consistent if they had been preserved.

Plaintiff disagreed. He replied that there were no more than ten missing messages and they did not include kitchen manager duties.  He said that they were about “scheduling, basic onboarding information and otherwise just exchanging general pleasantries.”  He also pointed to available texts that indicated he was promoted later in his employment.

The Court wrote:

The Court has no trouble finding that the missing text messages are relevant to the dispute, since they would have some tendency to prove whether Plaintiff was initially hired as a line cook or kitchen manager. However, the Court cannot conclude that Defendants have carried their burden of showing prejudice of a type sufficient to warrant any discovery sanction. On the record before the Court, the evidence as to which position Plaintiff was initially hired for is mixed. More importantly, the evidence as to whether the missing text messages would have supported Defendants or Plaintiff is mixed. As both sides also concede, the missing text messages are not the only potential evidence on this issue. Accordingly, the Court cannot conclude that they are “essential to [a party’s] underlying claim.’ ”

There is no presumption of prejudice under Rule 37(e)(1).  However, if intent is demonstrated, Rule 37(e)(2) creates a presumption.  Next, Court held that defendant had not shown “intent to deprive” by clear and convincing evidence.

Plaintiff should have taken additional steps to preserve the missing text messages considering the circumstances and timeline of this case, rather than rely on their continuing availability from their sole repository—Plaintiff’s phone. Such a failure under such circumstances may amount to negligence, but negligence is insufficient to establish an intent to deprive, especially when not coupled with any affirmative conduct on Plaintiff’s part to occasion the loss, other than being the victim of a theft. While forgetting to lock one’s vehicle after a long workday may have made such a theft more likely, none of the surrounding circumstances suggest that this lapse was intentional.

The opinion concludes: “[T]he undersigned recommends that no sanctions are appropriate. Rather, the issue of the missing text messages should be dealt with according to the usual rules of evidence, with Judge Rubin being in the best position to decide the extent to which the parties can introduce evidence and testimony regarding the missing text messages and the circumstances of their unavailability.”

In sum, while it may be defensible, preservation in place is perilous and can often be avoided. As Craig Ball wrote:

I grant that a full unencrypted backup of an iPhone isn’t going to encompass all the data that might be gleaned by a pull-out-all-stops forensic preservation of the phone.  But so what?  As my corporate colleagues love to say, “the standard for ESI preservation isn’t perfect.”  I always agree adding, “but it isn’t lousy either.”  Preserving by backup isn’t perfect; but, it isn’t lousy.  I’ve come to regard it as sufficient and proportionate.  It’s good enough, and in most cases, darn good.

A New Paradigm in Mobile Device Preservation.

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[1] See e.g., Self-Identification and Self-Preservation: A Fool for a Client?

 

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Michael Berman, Esq., is the owner of E-Discovery LLC and Of Counsel to Rifkin Weiner Livingston. He has published extensively, including as the editor-in-chief and a contributing author in “Electronically Stored Information in Maryland Courts” (Maryland State Bar Ass’n. 2020). The opinions expressed are solely those of the author.