Complex Litigation

Appellate Division Clarifies Spoliation Standards

By Michael Hoenig - New York Law Journal - October 21, 2013

Assume a New York Police Department (NYPD) vehicle collides with another car, mounts a curb and strikes five pedestrians who sue New York City for their injuries. Assume further that the city defends by interposing the defense of the "emergency doctrine," claiming that the NYPD vehicle was an authorized emergency vehicle engaged in an emergency operation at the time of the accident. Such a defense would render the city liable only if the NYPD driver acted with "reckless disregard for the safety of others." Later, however, the plaintiffs find out that audiotapes and "radio run audio recordings" containing relevant information related to the alleged police emergency were not retained because such tapes are routinely maintained only for 180 days and then deleted.

Can the plaintiffs invoke "spoliation" sanctions for the automatic destruction of a recorded radio run that could have either confirmed or called into question the city's "emergency operation" defense under Vehicle and Traffic Law §114-b, 1103 and 1104? If the answer is "yes," what legal standard of spoliation should the court apply to a destroyed audiotape of a radio communication?

Should the traditional common law spoliation standard apply or should the so-called Zubulake standard regarding spoliation of discoverable electronically stored information (ESI) govern? Further, where the destruction of the evidentiary material is not caused by a willful failure to disclose, what should the appropriate sanction be? Should the city's pleading of an emergency operation defense be struck? Or, should a limited preclusion be imposed, say perhaps, merely preventing the city from introducing testimony as to the contents of the audio recording? How about an "adverse inference" charge to the jury at trial?

The foregoing are questions asked and answered by New York's Appellate Division, First Department, in its "hot off the press" ruling in Strong v. City of N.Y.1 Issued on Oct. 15, the decision declines to apply the federal Zubulake spoliation standard applicable to ESI when the evidentiary material destroyed is a non-ESI audio recording. New York's common law rule regarding spoliation of evidence is sufficient and "reliance on the federal standard is unnecessary in this context."2 The Zubulake IV decision by U.S. Southern District of New York Judge Shira A. Scheindlin ruled that "[o]nce a party reasonably anticipates litigation, it must suspend its routine document retention/destruction policy and put in place a litigation hold" to preserve evidence.3 Our Sept. 9 column reported on Scheindlin's Aug. 15 Sekisui ruling imposing sanctions for deletion of e-mail files.4

As to cases involving ESI discovery, the First Department had adopted the Zubulake IV spoliation rule in a number of relatively recent decisions of which, perhaps, the VOOM ruling is the most memorable because of its name.5 The First Department's application of the federal Zubulake standard to e-discovery is based on its "usefulness" in that it "provides litigants with sufficient certainty as to the nature of their obligations in the electronic discovery context and when those obligations are triggered."6 Also, as the court in VOOM observed, Zubulake "is harmonious with New York precedent in the traditional discovery context," an area that "did not need greater certainty or clarification."7

The First Department did comment on the fact that a few recent First Department decisions quote the Zubulake or VOOM formulation in cases not involving ESI evidence, thus seeming to employ the federal standard for spoliation of non-electronic evidence as well. Two of those cases involved surveillance videos that were destroyed or automatically recorded over while a third case involved disposal of an entire computer.8 Nevertheless, in Strong the First Department now clarifies and "conclude[s] that reliance on the federal standard is unnecessary in this context. Zubulake interpreted federal rules and earlier federal case law to adapt those rules to the context of ESI discovery." When the spoliation involves "the erasure of, and the obligation to preserve, relevant audiotapes and videotapes," however, such conduct "can be, and has been, fully addressed without reference to the federal rules and standards."9

Standards Clarified

And what are those state common law standards regarding non-ESI spoliation? When the destruction of evidence does not involve refusal to comply with a discovery order or a willful failure to disclose (the latter scenarios would instead be governed by CPLR 3126), then common law spoliation sanctions can be imposed not only for willful destruction of evidence but also for negligent spoliation. The First Department clarifies that merely negligent destruction may be penalized despite language in some New York cases that only willful, deliberate or contumacious destruction warrants spoliation sanctions.10 Indeed, said the First Department in Strong, "This Court has, on many occasions, authorized the imposition of sanctions where the destruction of evidence was negligent rather than willful."

The court recalled that its "earliest" New York cases involving negligent spoliation concerned destruction of allegedly defective equipment. Thus, in Squitieri v. City of N.Y.,11 the city was sued by a sanitation worker injured by carbon monoxide poisoning caused by a defective street sweeping vehicle. The city disposed of the vehicle while the case was ongoing. Years later, the city impleaded the vehicle manufacturer but the third-party claim was dismissed because "the absence of the sweeper would prevent [the manufacturer] from countering the design defect claim with evidence that the city's misuse, alteration, or poor maintenance of this particular sweeper was a proximate cause of Squitieri's injuries." The court held that dismissal and preclusion sanctions are not limited to willful or bad faith destruction "since a party's negligent loss of evidence can be just as fatal to the other party's ability to present a defense."12

Having established that negligent erasure of audiotapes can "certainly" give rise to sanctions, the question then becomes whether the spoliator was "on notice that the [audiotapes] might be needed for future litigation."13 In Strong, the city was placed on notice of plaintiffs' claim and its own claimed affirmative defense of emergency within the 180 days after the recording was made. The city, therefore, "had the obligation to take steps to prevent the automatic erasure of any audio recording from that incident, and its failure to do so constituted spoliation." The court proceeded to focus on what the sanction should be. Plaintiffs urged that the emergency defense be stricken. But the court concluded that a lesser sanction would be appropriate.

The striking of a pleading is a severe punishment. So is outright preclusion of offering any evidence in support of the defense. Preclusion would be appropriate where "defendants destroyed essential physical evidence leaving the plaintiff without appropriate means to confront a claim with incisive evidence." Here, however, the radio run audio recording is "not key" to the proof of plaintiff's case in chief, although, depending on its contents, "it could have been relevant either to prove or help disprove defendant's emergency operation defense." Yet, plaintiffs can still challenge the city's emergency defense through examination of the police officers involved and their commanding officer. Thus full preclusion of any evidence that establishes the defense "would be excessive." What would be appropriate, however, is "preventing the City from introducing testimony as to the contents of the audio recording." Further, if warranted, an "adverse inference charge at trial may be an appropriate additional sanction."14

Conclusion

In "bullet" form, the new Strong decision teaches or confirms that: (1) The Zubulake IV federal spoliation standard applies to discoverable ESI materials; (2) Once a party reasonably anticipates litigation, it must issue a litigation hold and suspend its routine document destruction (ESI) policy; (3) Non-ESI evidence destruction is governed by state common law spoliation rules—unless the destruction is caused by refusal to comply with a discovery order or a willful failure to disclose, in which case CPLR 3126 would govern; (4) Spoliation sanctions can be awarded for merely negligent destruction; (5) Non-retention of evidentiary materials such as videos and audio recordings when the spoliator is on notice that they might be needed for future litigation can be penalized; (6) Merely negligent non-retention or destruction of evidence, when one is on notice it might be needed in future litigation, can result in a range of sanctions, such as the striking of the spoliator's pleading, preclusion of evidence and/or the giving of an adverse inference jury instruction (among other potential sanctions).

Michael Hoenig is a member of Herzfeld & Rubin.

Endnotes:

1. 2013 NY Slip Op 06655 (1st Dept., Oct. 15, 2013). See B. Pierson, "City Sanctioned for Destruction of Police Radio Call Recordings," New York Law Journal, Oct. 16, 2013, p. 1.

2. Id., Slip Op at p. 9.

3. Zubulake v. UBS Warburg, 220 F.R.D. 212, 218 (S.D.N.Y. 2003) (Zubulake IV). See M. Hoenig, "Appellate Division Embraces Federal ESI Standards," NYLJ, March 12, 2012, p. 3 (discussing the Zubulake factors and New York decisions adopting them).

4. M. Hoenig, "Penalties Awarded for Wrongful Deletion of Emails," NYLJ, Sept. 9, 2013, p. 3.

5. U.S. Bank v. GreenPoint Mtge. Funding, 94 AD3d 58 (1st Dept. 2012); VOOM HD Holdings v. EchoStar Satellite, 93 AD3d 33 (1st Dept. 2012); Tener v. Cremer, 89 AD3d 75 (1st Dept. 2011); Ahroner v. Israel Discount Bank of N.Y., 79 AD 3d 481 (1st Dept. 2010).

6. Strong v. City of N.Y., NY Slip Op 06655, at p. 8 (citing and quoting from VOOM, 93 AD 3d at 36).

7. Id., Slip Op at p. 8.

8. Id., Slip Op at p. 8 (citing N.Y. City Housing Auth. v. Pro Quest Sec., 108 AD3d 471 (1st Dept. 2013) (part of surveillance video destroyed); Suazo v. Linden Plaza Assoc., 102 AD 3d 570, 571 (1st Dept. 2013) (surveillance of video automatically recorded over); Harry Weiss v. Moskowitz, 106 AD 3d 668, 669 (1st Dept. 2013) (entire computer disposed of)).

9. Id., Slip Op at p. 9.

10. The court cites as an example Kerman v. Martin Friedman, C.P.A., 21 AD 3d 997, 999 (2d Dept. 2005).

11. 248 AD 2d 201 (1st Dep't 1998).

12 .Squitieri, Id., at 203.

13. Strong, NY Slip Op 06655, at p. 7 (citing case law).

14. Id., Slip Op at p. 9.

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