An unreported decision of the intermediate appellate court provides an interesting contrast to Steamfitters Local Union No. 602 v. Erie Insurance Exchange, 469 Md. 704 (2020), which is discussed in a prior blog.
In Benson v. ALDI, Inc., 2019 WL 5704532 (Md. Ct. Spl. Apls. Nov. 5, 2019), summary judgment was affirmed against a customer injured in a grocery store. After the injury, the store manager and customer filled out an incident report. The report was sent to the district manager and insurer. The store manager then called the district manager with an oral report. The district manger then reviewed the video.
The video footage was not preserved. Instead, it was overwritten during the ordinary rotation process.
In Steamfitters, sanctions were affirmed because video evidence was destroyed after a preservation letter had been sent regarding a large fire incident. The Court rejected defendants’ argument that the spoliated video was exculpatory or irrelevant because it allegedly did not focus on the precise area at issue.
While the Steamfitters defendant was put on notice by the preservation letter before the deletion, in ALDI, the store received plaintiff’s preservation letter approximately a week after destruction of the video. The Court accepted defendant’s affidavit that the spoliated video was irrelevant because it did not capture the incident at issue.
In ALDI, the plaintiff unsuccessfully asserted spoliation because the store had video footage of the scene; however, it was not preserved.
ALDI’s responded that its employee had inspected the area shortly before the occurrence causing the injury and found no hazardous condition. It submitted an affidavit of a district manager who had reviewed the video following the incident. The ALDI’s employee stated that the video was taken from “an angle that did not capture the incident.”1
The store made two arguments to justify the failure to preserve the video. First, it asserted that it had simply followed company policy. Second, it argued that plaintiff had failed to notify the store to preserve the evidence.
The Court agreed with ALDI’s, holding that the defendant had no duty to preserve the video. The injury occurred on February 8, 2017. ALDI’s had a six-week rotation to overwrite video. Thus, the video would be routinely overwritten, at the latest, on March 22, 2017. Plaintiff’s lawyer sent a preservation letter roughly a week later, on March 30, 2017.
ALDI is unreported: “An unreported opinion of the … Court of Special Appeals is neither precedent within the rule of stare decisis nor persuasive authority.” Md. Rule 1-104(a). The Rule “may not be circumvented merely because a commercial publisher decides to publish the opinion. If we file the Opinion as unreported and, as a result, it does not appear in the official Maryland Appellate Reports, it is subject to the Rule.” Nicholson v. Yamaha Motor Co., 80 Md. App. 695, 718 (1989), cert denied, 318 Md. 683 (1990).
I submit that both of ALDI’s arguments against sanctions were flawed.
Maryland retains the antiquated “safe harbor” rule. Md. Rule 2-433(b) (“Absent exceptional circumstances, a court may not impose sanctions under these Rules on a party for failing to provide electronically stored information that is no longer available as a result of the routine, good-faith operations of an electronic information system.”).
Fed.R.Civ.P. 37(e) has abandoned this provision as unsatisfactory. And, it was not cited by the ALDI Court.
Even if it had been cited, it is well-accepted that, after the duty to preserve has been triggered, destruction is no longer a “routine, good faith” operation. For example, the Advisory Committee Notes to the abrogated federal “safe harbor rule,” what was then Fed.R.Civ.P. 37(f), and later re-numbered as Rule 37(e), state:
Good faith in the routine operation of an information system may involve a party’s intervention to modify or suspend certain features of that routine operation to prevent the loss of information, if that information is subject to a preservation obligation. A preservation obligation may arise from many sources, including common law, statutes, regulations, or a court order in the case. The good faith requirement of Rule 37(f) means that a party is not permitted to exploit the routine operation of an information system to thwart discovery obligations by allowing that operation to continue in order to destroy specific stored information that it is required to preserve. When a party is under a duty to preserve information because of pending or reasonably anticipated litigation, intervention in the routine operation of an information system is one aspect of what is often called a “litigation hold.” Among the factors that bear on a party’s good faith in the routine operation of an information system are the steps the party took to comply with a court order in the case or party agreement requiring preservation of specific electronically stored information. [emphasis added].
I would submit that destruction is no longer “routine, good faith” operation where: (1) plaintiff was a business invitee at the time; (2) an injury occurred; (3) an incident report was prepared, sent to the district manager and also sent to the insurer; (4) the store manager followed up with an oral report; and, (5) the district manager reviewed the video following the incident. The facts that an insurer was contacted and the district manager viewed the video provide evidence that litigation was anticipated. ALDI’s following “company policy” should not be a sufficient response on these facts.
I suggest that the Court’s reliance on the fact that a preservation demand was not made until a week after expiration of the rotation policy is equally flawed.
It is well accepted that the duty to preserve arises when litigation is reasonably anticipated. See M. Berman, et al., eds., “Electronically Stored Information in Maryland Courts” (Md. State Bar Ass’n. 2020), 149, 155-56 n. 8 (discussing ALDI).
It is also settled that a preservation letter from an opponent is not necessary to trigger the duty to preserve potentially responsive information. As I pointed out in the Steamfitters blog,
While a litigant certainly may request that an adversary agree to preserve electronic records during the pendency of a case, … it is not required, and a failure to do so does not vitiate the independent obligation of an adverse party to preserve such information.
Thompson v. U.S. Dep’t of Hous. & Urban Dev., 219 F.R.D. 93, 100 (D. Md. 2003) (emphasis added); accord ESI Principle 2.01(c) of the United States District Court for the District of Maryland.
If litigation was reasonably anticipated or imminent, the duty was triggered even without a preservation letter from the plaintiff. ALDI’s argument was a red herring. While one may argue whether the common-law duty was triggered, on the facts set out above, I suggest that it was.
While not necessary, preservation letters are most often valuable: “Of course, a well- drafted preservation letter may help delineate the issues and assist in defining the scope of that preservation duty.” M. Berman, et al., “Electronically Stored Information in Maryland Courts” at 156.
The ALDI Court made no proportionality analysis. The plaintiff sustained a torn quadriceps. It may be assumed that the cost to preserve the video would have been minimal.
The ALDI Court wrote that it might have reached a different result if plaintiff “submitted evidence of intentional destruction or of negligence on ALDI’s part as to preservation.”
1It is not clear how the district manager defined “the incident.” The opinion did not discuss whether the ALDI employee’s inspection was or was not on missing video. The manner and duration of that inspection was at least arguably relevant. Further, if it was not visible, it may have impeached ALDI’s evidence.