Puerto Rico Telephone Company, Inc. v. San Juan Cable LLC

Filing 196

ORDER denying without prejudice 126 Motion for Sanctions. Signed by US Magistrate Judge Bruce J. McGiverin on October 7, 2013. (McGiverin, Bruce)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
PUERTO RICO TELEPHONE
COMPANY, INC, et al.,
Plaintiffs,
Civil No. 11-2135 (GAG/BJM)

v.
SAN JUAN CABLE LLC,
Defendants.
ORDER

Before the court is plaintiff Puerto Rico Telephone Company, Inc.’s (“PRTC”)
renewed motion for sanctions due to spoliation of evidence. Docket Nos. 124, 126
(“Mot.”). Defendant San Juan Cable LLC, d/b/a OneLink Communications (“OneLink),
opposed. Docket No. 140. Plaintiff replied (Docket Nos. 167, 169), and defendant filed
a sur-reply (Docket No. 185). The motion was referred to me for disposition. Docket
No. 128.

For the reasons set forth below, the motion is DENIED WITHOUT

PREJUDICE.
PRTC contends that OneLink engaged in sanctionable spoliation of evidence by
failing to preserve relevant emails from the personal email accounts of three former
OneLink officers (CEO Ron Dorchester, General Manager Bill Chain, and Senior Vice
President Sandra Perry).

Based on this failure, PRTC seeks an adverse inference

instruction at the summary judgment stage and at trial.
Parties have a general duty to preserve relevant evidence once it has notice of, or
reasonably foresees, litigation. Perez-Garcia v. P.R. Ports Auth., 871 F. Supp. 2d 66, 69
(D.P.R. 2012) (citing Zubulake v. UBS Warburg LLC, 220 F.R.D. 212, 216 (S.D.N.Y.
2003)). A party’s failure to preserve evidence relevant to pending litigation constitutes
spoliation. Velez v. Marriott PR Mgmt., Inc., 590 F. Supp. 2d 235, 258 (D.P.R. 2008).
The party urging that spoliation has occurred has the burden of showing that evidence

Puerto Rico Telephone Co. v. San Juan Cable LLC, Civil No. 11-2135 (GAG/BJM)

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was in fact destroyed or not preserved. Gomez v. Stop & Shop Supermarket Co., 670 F.3d
395, 399 (1st Cir. 2012).
Upon a finding of spoliation, the court has considerable discretion in determining
whether and which sanctions are warranted. See Booker v. Mass. Dep't of Pub. Health,
612 F.3d 34, 46 (1st Cir. 2010). To do so, the court takes into account any prejudice to
the non-offending party, and whether bad faith motivated the spoliator’s conduct.
Sacramona v. Bridgestone/Firestone, Inc., 106 F.3d 444, 447 (1st Cir. 1997). An adverse
inference instruction is one possible sanction. But when seeking an adverse inference
instruction, the proponent of the inference must provide sufficient evidence to “show that
the party who destroyed the document ‘knew of (a) the claim (that is, the litigation or the
potential for litigation), and (b) the document's potential relevance to that claim.’”
Booker, 612 F.3d at 46 (quoting Testa v. Wal-Mart Stores, Inc., 144 F.3d 173, 177 (1st
Cir.1998)). Such an instruction usually is appropriate “only where the evidence permits a
finding of bad faith destruction,” United States v. Laurent, 607 F.3d 895, 902 (1st Cir.
2010), but bad faith is not required where circumstances indicate an adverse inference
instruction is otherwise warranted, Nation-Wide Check Corp. v. Forest Hills Distrib., Inc.,
692 F.2d 214, 219 (1st Cir. 1982). And above all, an adverse inference instruction must
“make sense in the context of the evidence.” Laurent, 607 F.3d at 903.
Here, plaintiff has proffered sufficient evidence to establish that OneLink failed to
preserve relevant emails within its control. While the emails at issue come from the
personal email accounts of OneLink’s former officers, these officers had used their
personal email accounts to manage the company for as long as seven years. Mot. 12.
OneLink presumably knew its managing officers used their personal email accounts to
engage in company business, and thus its duty to preserve extended to those personal
email accounts. See E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 803 F. Supp.
2d 469, 501 (E.D. Va. 2011) (finding spoliation in part based on deletion of relevant
emails from employees’ personal email accounts). In response, OneLink maintains that

Puerto Rico Telephone Co. v. San Juan Cable LLC, Civil No. 11-2135 (GAG/BJM)

3

out of the 61 unique email chains that PRTC has obtained from other sources, almost all
of them are either non-responsive, privileged, or have been produced.

Ultimately,

however, OneLink admits to being unable to account for three responsive email chains
from former CEO Ron Dorchester’s personal email account. OneLink’s failure to locate
these emails in its files is a breach of its duty to preserve and constitutes spoliation.
However, I find plaintiff’s request for sanctions problematic on multiple fronts.
While OneLink and Dorchester presumably knew of PRTC’s claims and the potential
relevance of Dorchester’s emails to those claims, the absence of bad faith on OneLink’s
part and PRTC’s failure to demonstrate prejudice at this time counsels against imposing a
sanction as harsh as an adverse inference instruction. Within a month of plaintiff filing
the complaint, OneLink issued a litigation hold notice to its employees, including the
former officers at issue in this dispute. The hold notice informed the officers of their duty
to preserve all relevant evidence, including electronic data. Approximately a year later,
PRTC served its first set of discovery requests on November 14, 2012, right around the
time the three officers in question left OneLink. The parties engaged in discovery for
most of 2013 and at the end of the day, it appears that only three email chains were in fact
“lost” and could not be accounted for in OneLink’s or the former officers’ files. Docket
Nos. 140-1, ¶ 9.h; 140-4. PRTC has proffered no evidence that OneLink or Dorchester
intentionally deleted those three email chains in bad faith. And the fact that the three
email chains have been recovered through other sources lessens any prejudice to PRTC.
Moreover, upon review of the three email chains, it cannot be said that their
relevance is potentially damaging to OneLink. Like the situation in Booker, “this is not a
case in which a document’s potential relevance to the plaintiff’s claim is apparent from
the nature of the missing document itself.” 612 F.3d 347. At this time, PRTC cannot
articulate a clear theory of how it has suffered prejudice, because the extent of spoliation
is unknown. Any prejudice suffered by PRTC is currently speculative; PRTC has not
proffered evidence that tends to show the allegedly “lost” emails would actually support

Puerto Rico Telephone Co. v. San Juan Cable LLC, Civil No. 11-2135 (GAG/BJM)

PRTC’s claims or weaken OneLink’s defenses.

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Therefore, under the circumstances

before me, there is insufficient foundation for an adverse inference instruction.
Upon further discovery, more information regarding the extent of spoliation may
come to light.

Forensic analysis of these three former employees’ personal email

accounts and computers may be appropriate to determine whether critical emails have
been deleted. Nacco Materials Handling Grp., Inc. v. Lilly Co., 278 F.R.D. 395, 406
(W.D. Tenn. 2011) (“The only way to determine if relevant evidence currently exists or
previously existed and was lost destroyed is to conduct a forensic examination to see if
such evidence exists.”). At that time, plaintiff may renew its motion for sanctions if
circumstances so warrant.
CONCLUSION
For the foregoing reasons, plaintiffs’ motion for sanctions is DENIED
WITHOUT PREJUDICE.
IT IS SO ORDERED.
In San Juan, Puerto Rico, this 7th day of October, 2013.
S/Bruce J. McGiverin
BRUCE J. MCGIVERIN
United States Magistrate Judge