Destroy or Delete Electronic Evidence at Your Own Peril

‘‘In many jurisdictions, once a suit is commenced, or even a reasonable expectation of litigation exists, an unchecked document retention policy which recycles or overwrites back-up tapes or otherwise deletes data must be suspended or the data be copied so that it is available once discovery has begun.’’ ^[3]

As soon as you receive word that a lawsuit or investigation is underway, or even suspect that a claim may be filed down the road, you must suspend your document destruction policy or risk deleting files that may be subpoenaed as part of the discovery process.

Real-Life E-Disaster Story:
The Investment Banker’s E-Mail Triggers Obstruction of Justice Charge

Investment banker Frank Quattrone was accused of obstructing investigations by a federal grand jury and the SEC after he forwarded an email urging members of his technology-sector banking group at Credit Suisse First Boston (CSFB) to ‘‘clean up’’ their files.

At the time he sent the e-mail, the grand jury and regulators were investigating whether CSFB accepted kickbacks from hedge funds in exchange for hot IPOs. The file-cleanup e-mail was just one of several that prosecutors used as evidence in the high-profile, widely publicized case against Quattrone. ^[4]

The Quattrone case illustrates why corporate IM and e-mail users should never destroy evidence after an inquiry begins, or if you suspect a message may someday be relevant to litigation.

The Quattrone case, which ended in a mistrial, also gives individual IM and e-mail users another reason for alarm. Under the legal principle of vicarious liability, employers are typically held responsible for the wrong acts of employees. In the Quattrone obstruction of justice case, however, the individual executive, not Credit Suisse First Boston, was held responsible for ordering the deletion of files.

^[3]J. Robert Keena, ‘‘High-Tech Discovery Disputes,’’ Legal Tech Newsletter (December 2001).

^[4]Randall Smith and Kara Scannell, ‘‘E-Mail Is Sought in Quattrone Trial,’’ TheWall Street Journal (October 23, 2003), C12.