How Corporations Can Prevent Spoliation of Electronic Evidence With A Proper Legal Hold Notice

Our previous blog on electronic discovery provided 10 tips for creating an electronic discovery plan to help potential litigants understand the process of electronic discovery and how to work with their lawyers to reduce the associated time and costs. This blog will focus on creating a proper legal hold notice to prevent spoliation of electronically stored information, or ESI.

Before any lawsuit is filed, a party’s duty to preserve and hold ESI generally arises when the party “reasonably foresees” that a dispute could lead to future litigation. If ESI is not preserved or is somehow destroyed, it can lead to claims of spoliation by the other side during litigation, which can have significant consequences. This is where a legal hold notice comes in, particularly for corporations with multiple employees who may have relevant evidence that needs to be preserved.

A legal hold notice is a notice that a corporation circulates internally within the organization to those who may have relevant ESI, telling them to preserve certain evidence. The corporation should work with its lawyers to draft the legal hold notice. Proper drafting and diligent implementation of a legal hold can go a long way in preventing any claims of spoliation.

Generally, an effective legal hold notice would include the following:

• A brief description of the potential dispute and the potential issues;
• The identities of individuals or groups to whom the hold applies;
• Instructions on how to change settings of any electronic devices or software that automatically delete records;
• Directions not to destroy any records relevant to the issues specified in the notice;
• Describe the scope of the ESI or other materials that must be preserved;
• Names and contact information of key players in the corporation who were involved in or are familiar with the dispute at issue;
• The date range of ESI and other materials to preserve;
• Examples of electronic devices likely to have relevant ESI, e.g., computers, work phones, personal phones, etc.;
• Examples of sources likely to contain relevant ESI, e.g., email, text messages, Slack, Microsoft Teams, WhatsApp, social media, etc.;
• Inform recipients of their legal obligations and the potential penalties for noncompliance; and
• Provide instructions for communicating about the legal hold to others in the corporation.

After a litigation hold notice has been issued, corporations should obtain from the recipients a signed acknowledgement of the legal hold notice and confirmation that automatic deletion of relevant data has been halted. Corporations should also issue reminders of the legal hold notice on an ongoing basis to remind individuals of their duty to preserve.

It should also be noted that, if a lawsuit is brought after a litigation hold notice has been issued, the party that issued the litigation hold notice might be compelled to produce the notice to the other side if there is a preliminary showing that relevant ESI was somehow destroyed or not preserved, i.e., spoliated evidence. If the corporation properly issued and implemented the litigation hold, however, the corporation likely will be able to defeat any claim of spoliation of evidence.