Motion for Sanctions Denied for Automatic Deletion of Browsing History

18 Aug 2017

deleted automatically

In Eshelman v. Puma Biotechnology, No. 7:16-CV-18-D (ED NC June 7, 2017), Plaintiff sued Defendants Puma Biotechnology (“Puma”) and its CEO for libel per se and libel per quod based upon allegedly defamatory statements regarding a clinical trial scandal in February of 2016.

Defendant Puma is a bio-pharmaceutical company focused on acquiring, developing, and commercializing innovative cancer-care products. Plaintiff founded Pharmaceutical Product Development (“PPD”), a North Carolina-based global contract pharmaceutical research organization. Plaintiff’s company was involved in clinical trials for a new drug, when one of PPD’s clinical investigators falsified documents. Puma’s CEO allegedly made false statements that Plaintiff had been involved in the clinical trial scandal at PPD and lost his job as a result. Defendant also shared these allegedly defamatory statements with the company’s stockholders and published it on the company’s website.

After Plaintiff filed suit, Defendant implemented an internal litigation hold. The hold notice defined documents to include electronically-stored information and advised employees to err on the side of preservation if there was a question as to whether material qualified as documents, but did not explicitly reference internet browser histories, internet search histories, or internet sites visited. In May of 2016, Plaintiff’s counsel sent a letter to Defendants’ counsel “requesting that Defendants preserve, among other things, the “web browser histories” of individuals involved in drafting the allegedly defamatory investor presentation. In June, Plaintiff served Defendants with document requests including browser histories and all documents and websites used in preparing the allegedly defamatory investor presentation.

Defendants’ counsel informed Plaintiff’s counsel that Defendants used Google Chrome as an internet browser, which deleted automatically web browser history after 90 days. Accordingly, the web browser history sought in the discovery requests no longer existed and did not exist at the time of the May 2016 letter. Plaintiff argued that Defendants failed to preserve the web browser and search histories. Plaintiff moved for sanctions and asked for a jury instruction to help mitigate the harm caused by Defendants’ failure to comply with discovery obligations.

The court reviewed FRCP 37(e) governance of the Court’s power to sanction a party for failing to preserve ESI. FRCP 37(e)(2) provides for relief in the form of an adverse jury instruction, but the court may also impose some form of a jury instruction under FRCP 37(e)(1) to the extent necessary to cure prejudice caused by the loss of the ESI. The Court went on to determine whether the following four threshold requirements existed: (1) The ESI should have been preserved in the first place; (2) The ESI was lost; (3) The loss was due to a party’s failure to take reasonable steps to preserve the ESI; and (4) The ESI cannot be restored or replaced through additional discovery. The Court determined that Plaintiff failed to meet the final fourth category, finding that while the Internet browser search information was automatically deleted and could not be restored, other avenues of discovery would likely reveal information about the searches performed. In addition, to impose a sanction under FRCP 37(e)(1), the court must have some evidence regarding the nature of the missing ESI in order to evaluate the prejudice it is being requested to mitigate. Plaintiff failed to do that. Defendant was therefore, at most, negligent in the failure to preserve ESI. Finding that such conduct did not rise to the threshold for sanctions under FRCP 37(e)(2), the Court ruled that Plaintiff was not entitled to the requested adverse jury instruction.


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