Ninth Circuit – – Don’t Destroy Relevant Texts

Failure to Show “Intent to Deprive” Leads to Denial of Rule 37(e)(2) Sanctions
March 5, 2024
Another Spoliation Motion Denied as Untimely
March 14, 2024

Dismissal of plaintiff’s claims under Fed.R.Civ.P. 37(e)(2) was affirmed in Jones v. Riot Hosp. Grp. LLC, __ F. 4th__, 2024 WL 927669 (9th Cir. Mar. 5, 2024).  The case is a textbook example of a plaintiff tanking her own case by deleting relevant texts.

Ms. Jones, a former waitress, sued a bar owner-operator and his company, Riot Hospitality Group, Inc., alleging Title VII violations and common-law torts.

One goal of a good evaluation of ESI is to look for gaps, and that is what defense counsel did: “During discovery, Riot obtained text messages exchanged between Jones, her friends, and co-workers between December 2015 and October 2018. Riot identified instances where Jones appeared to have abruptly stopped communicating with people she had been messaging almost daily.”  Id. at *1.

In the words of Ms. Laura Zubulake:  “Where there was e-smoke, I suspected there would be e-fire.”  L. A. Zubulake, “Zubulake’s e-Discovery: The Untold Story of My Quest for Justice” (2012).  Here, defense counsel found plenty of e-fire.

Most litigation review platforms generate a histogram that will graphically show gaps in a timeline.

Defense counsel issued a subpoena and the court wrote: “In response to a subpoena, Jones’ third-party imaging vendor produced a spreadsheet showing that messages between Jones and her co-workers had been deleted from Jones’ mobile phone. In subsequent depositions, two of the co-workers, both of whom Jones had identified as prospective trial witnesses, testified that they had exchanged text messages with Jones about the case since October 2018.”

The District Court ordered the parties to jointly retain an expert to review all four phones – Ms. Jones and three prospective witnesses. The expert extracted messages from three of the phones. The messages were found with stipulated search terms and the expert provided them to plaintiff’s counsel for privilege review.  One witness did not comply and testimony from that witness was excluded.

Ms. Jones’ attorney failed to provide the messages to the defendants in conformity with the order and the attorney and Ms. Jones were fined $69,576.  Id. at *2.  The District Court also ordered the forensic expert to provide all of the non-privileged messages to defense counsel.  Id.  The court explained: “Jones and [attorney] Nathanson next argue that they could not meet the court’s deadlines because the extracted messages contained ‘over 70,000 pieces of evidence.’ But the district court reasonably rejected this argument based on Nathanson’s repeated failure to process the messages received from [Kelly “K.J.”] Kuchta or work with the expert to resolve technical issues, despite receiving multiple extensions to do so.”  Id. at *6.[1]

The defendant moved for terminating sanctions under Fed.R.Civ.P. 37(e)(2).

Riot submitted an expert report from Kuchta, who concluded, after comparing the volume of messages sent and received between phone pairs, that “an orchestrated effort to delete and/or hide evidence subject to the Court’s order has occurred.” In 2022, the district court dismissed the case with prejudice, finding that Jones deleted text messages and cooperated in the deletion of messages by her witnesses, intending to deprive Riot of their use in litigation.

Id.  Plaintiff appealed, arguing that she did not violate Rule 37(e) and that the spoliation report should have been excluded.

The Ninth Circuit provided a summary of Rule 37(e), and wrote: “On appeal, Jones does not contest her duty to preserve the deleted messages, that they were deleted, or that they cannot be restored or replaced through additional discovery. But, she argues that the district court abused its discretion by dismissing the case because her conduct was neither willful nor prejudicial to Riot.”

The Ninth Circuit explained: “To dismiss a case under Rule 37(e)(2), a district court need only find that the Rule 37(e) prerequisites are met, the spoliating party acted with the intent required under Rule 37(e)(2), and lesser sanctions are insufficient to address the loss of the ESI.”

The court wrote: “Rule 37(e) does not define ‘intent,’ but in context, the word is most naturally understood as involving the willful destruction of evidence with the purpose of avoiding its discovery by an adverse party….  Because intent can rarely be shown directly, a district court may consider circumstantial evidence in determining whether a party acted with the intent required for Rule 37(e)(2) sanctions…. Relevant considerations include the timing of destruction, affirmative steps taken to delete evidence, and selective preservation.”

Applying those principles to the facts, the Ninth Circuit explained:

Jones contends that the district court erred in finding intent because Kuchta could not confirm that every deletion of a text message was intentional or quantify the intentional deletions. But there was ample circumstantial evidence that Jones intentionally destroyed a significant number of text messages and collaborated with others to do so. As the district court noted, Jones could not explain why messages to other employees at the bar were selectively deleted in 2017 and 2018. With respect to the 2019 and 2020 messages, the court pointed out that “while much of the content of the deleted messages is unknowable,” a screenshot of a message sent by a witness to Jones but missing from Jones’ phone in its original form, “shows that Plaintiff deleted at least one message that had a direct bearing on her case.” Jones, 2022 WL 3682031 at *10. Moreover, Jones and one of the witnesses obtained new phones shortly after they were ordered to hand over their devices for imaging. Neither Jones nor the witnesses produced the earlier phones for imaging, effectively preventing discovery of messages deleted from those phones. The court’s conclusion “that [Jones] affirmatively selected certain text messages for deletion while otherwise preserving text messages sent around the same time” is supported by the record. Id.

Jones argues that her production of thousands of text messages “negates the intent and prejudice elements of Rule 37(e).” But production of some evidence does not excuse destruction of other relevant evidence. And evidence from Jones’ third-party imaging vendor suggests that she deleted some messages from the very periods covered by her productions.

Ms. Jones argued that there was no prejudice to the defendant because she and the witnesses were deposed and defendant moved for summary judgment.  The Ninth Circuit properly swept that aside: “Rule 37(e)(2) does not mention prejudice as a prerequisite to sanctions, including dismissal. The Advisory Committee Notes explain that a finding of prejudice was not included as a requirement because ‘the finding of intent required by [Rule 37(e)(2)] can support not only an inference that the lost information was unfavorable to the party that intentionally destroyed it, but also an inference that the opposing party was prejudiced by the loss of information that would have favored its position.’” Id. at *4.

The appellate court also rejected the argument that the sanction was disproportionate to the prejudice.  See id. at *4.

Ms. Jones made several unsuccessful challenges to Mr. Kutchta’s report.  In one, “Jones argues that because Kuchta had earlier served as a special master, he had a conflict of interest. But Kuchta was jointly retained by the parties to conduct a forensic analysis of the submitted phones, not appointed by the district court as a Rule 53 special master. Nor did Jones demonstrate any actual conflict arising from Kuchta’s subsequent role as an expert; she speculates that Riot retained and communicated ex parte with Kuchta while he served as a party-appointed specialist, but the record does not support that claim.”  Id. at *4.

Finally, the court rejected several procedural and privacy challenges to the District Court’s discovery orders. Id. at *5.

In the court’s words:  “[T]he witnesses’ deposition testimony documented that they exchanged relevant text messages about the case; production by Jones’ third-party vendor showed that Jones had deleted messages; and Jones and Nathanson repeatedly failed to produce discoverable messages in violation of court orders.”  Id. at *5.

The case was described by Patrick Dorrian in Waitress Can’t Revive Job Bias Suit Nixed Over Deletion of Texts (bloomberglaw.com)(Mar, 5, 2024).

_____

[1] Mr. Kuchta is the CEO and Founder of FCS Management.

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