What is a “litigation hold” letter?

 

A litigation hold letter is a letter that instructs a recipient to preserve relevant documents and data in anticipation of litigation. The purpose of such a letter is to prevent spoliation, otherwise known as the destruction of evidence. The scope of a litigation hold letter can require preservation of e-mails, photographs, letters, text messages, and even voicemails.

 

What are signs that a litigation hold letter might be forthcoming?

 

Although litigation hold letters may arrive after litigation has commenced, they often precede litigation. If your business or organization is aware of an event that could reasonably lead to a lawsuit, has received a demand letter or cease-and-desist letter, or has been served a subpoena to produce documents, a litigation hold letter may soon follow.

 

What steps should I take upon receipt of a litigation hold letter?

 

If you receive a litigation hold letter, you have an obligation to take swift steps to preserve evidence. Such action might include the following: 

• Immediately alert record custodians, management, IT staff, other key personnel, and counsel (if applicable) to the litigation hold

• Identify which personnel have access to materials sought to be preserved

• Circulate notice regarding the types of documents and data for preservation

• Suspend deletion policies, including automatic email deletion, for those personnel or that content

• Identify and set aside relevant documents to ensure compliance, particularly if the letter identifies specific materials

• Respond to the litigation hold letter to confirm compliance or raise objections to the preservation request if overbroad

• Document all steps taken to comply with the litigation hold letter

• Continue to monitor internal compliance and circulate reminders as necessary

• Consider engaging an e-discovery platform to provide litigation hold software and streamline compliance

• Inform new employees of the litigation hold to ensure compliance continues through staffing changes

• Inform record custodians, management, IT staff, and other key personnel when the litigation hold is no longer in effect

 

If you have not received a litigation hold letter but see signs that a litigation hold letter may be on its way, you should consider implementing certain of these steps to ensure relevant evidence is preserved. As an aside, spoliation of evidence is something you should not be doing even if no one sends you a litigation hold letter. So long as litigation is pending or reasonably foreseeable, you may be sanctioned for destroying or altering potentially relevant evidence—even if that destruction was unintentional. If, for example, you reasonably anticipate litigation but do nothing to adjust your document retention/deletion policy, a court could sanction this negligent or reckless conduct if it resulted in destruction of potentially relevant documents. And note that an obligation to preserve documents is ongoing, until the litigation hold is removed or rendered moot.

 

What are possible consequences of non-compliance?

 

Failure to comply with a litigation hold letter can have severe consequences. Courts have broad discretion to issue sanctions if they determine that documents, emails, or other materials were deleted after receipt of a litigation hold letter. Possible consequences of ignoring a litigation hold letter can include, but are not limited to:

• Monetary sanctions

• A court finding your business or organization in contempt

• Preclusion of evidence and testimony

• Striking or dismissal of claims and defenses

• An adverse inference by the court or an adverse jury instruction regarding missing documents or materials

• Default judgment against your business or organization

• Dismissal of action

 

Remember, a litigation hold does not require that you produce records—only that you preserve them. Given the above consequences, the recipient of a litigation hold letter should seriously consider seeking advice of counsel.

 

Contact Buckley, Brion, McGuire & Morris LLP

 

If your business or organization receives a litigation hold letter and needs advice on how to proceed, contact the attorneys at Buckley, Brion, McGuire & Morris LLP to schedule a consultation.

 

This information does not create an attorney-client relationship between the firm and the reader, nor does this information constitute legal advice.

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