When Does Your Business Have to Preserve Electronic Evidence?
You may know that it is your duty to preserve electronically stored information (ESI), such as videos, emails, or other electronic information, when it is reasonable to believe that the information will be or could be relevant to a lawsuit.
That requirement applies whether you anticipate being a party to the lawsuit, or whether you aren’t a party, but you know the information you have may be relevant to or related to another lawsuit.
But when does that duty arise? Are you “aware” of a lawsuit when you get actual notice, such as a letter from one of the parties? What if there’s an event, like an accident, that you know usually leads to a lawsuit, but you don’t know that any lawsuit will actually ever be filed?
When You Should Know to Preserve ESI
Obviously, when you know an actual lawsuit has been filed (whether you’re a party to the lawsuit or not), it’s obvious that ESI needs to be preserved. But there doesn’t have to be a formal lawsuit. One case held that in an injury case, the minute the injury occurs, a business is on notice that it must preserve ESI. So the question isn’t whether there’s a lawsuit—the question is whether litigation is reasonably anticipated.
Informal notices of potential conflicts can lead to the duty to preserve evidence. For example, an email from a party that says that they feel a contract has been breached, could give rise to the duty to preserve ESI. A letter from a government agency saying there has been some breach, or some violation, can lead to the duty to preserve evidence as well.
But then the question becomes how specific does the notice have to be, in order to trigger the obligation to preserve evidence?
In many cases, courts have held that notice to a party has to specifically state the nature of the dispute, in order for the duty to preserve comes into effect. In other words, a general letter complaining, or even threatening litigation, without specifying the nature of the potential litigation (for example, “please be advised that litigation may be commenced”) may not be enough notice. A more specific allegation (“we think you have breached paragraph 12 of XYZ contract”) may be needed.
As you can see, there is no hard and fast rule that tells businesses when they have to keep, and when they can delete ESI. The best bet is to play it conservatively, and in the event there is any indication that a lawsuit could be forthcoming, to preserve ESI to the extent possible.
That means that your business should have some kind of override or policy or procedure, to prevent automatic overwrite or deletion of emails, surveillance videos, or notes made on or in internal management software.
Call the West Palm Beach business litigation lawyers at Pike & Lustig to help you make sure your corporate policies can keep you and your business safe from lawsuits and liability.