Court Orders Mirror Imaging of Defendant Electronic Devices on Ex Parte Basis
In Neuroscience, Inc. and Pharmasan Labs, Inc. v. Forrest and Cerulean Investments, Inc., No. 12-cv-813-bbc (Dist. Court, W.D. Wisconsin Dec. 3, 2013), plaintiff Neuroscience asserts defendant Forrest withheld and destroyed evidence in discovery. Neuroscience filed an ex parte motion demanding sanctions and discovery relief. This RICO litigation stems from allegations that Forrest submitted false insurance claims in the name of Neuroscience. Neuroscience in turn sued Forrest for fraud and racketeering.
At the ex parte hearing, Neuroscience offered evidence from third-party subpoenas, explaining Forrest was intentionally destroying and withholding evidence. Forrest was deleting files and not disclosing potentially relevant electronic information.
Rather than immediately grant plaintiff Neuroscience the discovery sanctions, the court “entered one last order” to defendant Forrest, requiring production to plaintiffs of all devices containing electronic documents within defendant control. Every device within Forrest’s control must be turned over, and the court specifically forbade Forrest from deleting, encrypting or altering any electronic documents on the devices. The court order gave Forrest only three days to produce the devices, and it allows plaintiffs to copy, or mirror image, all produced electronic devices.
No Spoliation Assessment Until Last Chance to Produce is Over
Plaintiffs, presenting third-party evidence of intentional spoliation during production, documented and asked for relief from the court, but the court was not quite ready to take punitive action against the defendant. However, the strict language and very short deadline for production, as well as allowing plaintiffs to copy all electronic devices in defendant’s control indicates the court’s patience was running thin.
Plaintiff counsel working with difficult or evasive defendants may find their deadlines stretched by courts willing to provide every opportunity to slow defendants, but documentation and missing files eventually work in plaintiff’s favor. Though sanctions are yet to be levied, plaintiffs get court ordered relief when defendants do not follow direct orders from the court.