In Episode 135, our CEO and Founder, Kelly Twigger discusses a decision from the 9th Circuit affirming dismissal of a case for intentional deletion of text messages as a sanction for failure to preserve under Rule 37(e) and the increased importance of early preservation of data on mobile devices in Jones v. Riot Hosp. Group, LLC, 2024 WL 927669 (9th Cir. 2024).
Introduction
Welcome to this week’s Case of the Week series brought to you by eDiscovery Assistant in partnership with ACEDS. My name is Kelly Twigger. I am the CEO and founder at eDiscovery Assistant, your GPS for ediscovery knowledge and education. Thanks so much for joining me today.
Each week on the Case of the Week I choose a recent decision in ediscovery and talk to you about the practical implications. This week’s decision raises yet another issue on the failure to preserve text messages and the resulting sanctions, this time from the 9th Circuit Court of Appeals.
Before we get started, if you haven’t yet had a chance to grab our 2023 eDiscovery Case Law Report that discusses the key trends and cases from last year, you can download that today.
All right, let’s dive into this week’s decision from the 9th Circuit Court of Appeals. If you saw my LinkedIn post earlier this week, you know that this is the second federal appellate decision we’ve seen in the last twelve months on spoliation sanctions for failure to preserve text messages.
This week’s decision comes to us from the Jones v. Riot Hosp. Group, LLC case. This is a decision dated March 5, 2024 and the opinion is written by United States Circuit Judge Andrew Hurwitz for the panel. This is the latest of several decisions on this matter that are in our database, so it has been a hotly contested discovery issue. This particular decision has the following issues attached to it: mobile device, form of production, text messages, bad faith, dismissal, spoliation, sanctions, forensic examination, search terms, proportionality, privacy, and failure to preserve. It also very briefly touches on Special Master and third party subpoena, although those issue tags are not applied.
Facts
We’re before the 9th Circuit on appeal of the dismissal of the case by the District Court finding that the plaintiff intentionally spoliated text messages.
The plaintiff here, Alyssa Jones, was a waitress in a bar in Scottsdale, Arizona. She sued the bar owner and his company, Riot Hospitality Group, alleging violations of Title VII and various tort claims. During discovery, Jones produced text messages between herself and her friends, as well as work colleagues, between December 2015 and October 2018. Upon receiving those text messages in discovery, defense counsel noted gaps in regular patterns of communication where Jones had been communicating with friends and colleagues daily, and she would suddenly stop.
In response to a subpoena following up on the review of that data, Jones’ third-party imaging vendor produced a spreadsheet showing that messages between Jones and her coworkers had been deleted from Jones’ mobile phone. Then, in depositions, two of the co-workers, both of whom Jones had identified as prospective trial witnesses, testified that they had exchanged messages with Jones about the case since October 2018.
Jones then failed to comply with the District Court’s order to produce those messages, and the District Court ordered the parties to jointly retain a third-party forensic search specialist to review the phones of Jones and three prospective witnesses. The District Court allowed Riot to subpoena the three witnesses to produce their most recent communications regarding plaintiff’s claims and ordered Jones to provide her phone to the agreed upon forensic specialist. The expert was to extract messages containing stipulated search terms and send them to Jones’ counsel, who would then send all discoverable messages to Riot and produce a privilege log of those that were not produced.
Per the Court, the plan is for the the third-party agreed upon expert to review the text messages, gather them, and send them to plaintiff’s counsel. Plaintiff’s counsel is then supposed to send them to defense counsel after reviewing them for privilege. Jones and two of the witnesses ultimately delivered the phones to the expert after much hoo-hah, the expert extracted messages and sent them to counsel, but counsel failed to forward them to Riot despite multiple District Court orders that he do so and several deadline extensions. The District Court finally ordered the expert to send all the non-privileged messages directly to Riot and later assessed almost $70,000 in fees and costs against Jones and her counsel for failure to comply with the Court’s orders.
After finally receiving the text messages, Riot moved for terminating sanctions under Federal Rule of Civil Procedure 37(e)(2), submitting an expert report that identified “an orchestrated effort to delete and/or hide evidence subject to the Court’s order.” The District Court dismissed the case with prejudice under Federal Rule of Civil Procedure 37(e)(2), finding that Jones deleted text messages and cooperated in the deletion of messages by her witnesses intending to deprive Riot of their use in litigation. Plaintiff then appealed, arguing that she did not violate Rule 37(e) and the spoliation report from the expert should have been excluded.
Analysis
The 9th Circuit begins with the standard of review on appeal, which is the high bar of abuse of discretion by the District Court. That standard requires the 9th Circuit to determine whether or not the District Court made any clear errors in the facts underlying the ruling. Appeal of the admission of the expert report is based on the abuse of discretion standard as well. The District Court found that Jones intentionally spoliated relevant text messages with her co-workers from 2017 and 2018 and coordinated with her witnesses to delete messages from 2019 and 2020.
The Appellate Court found that the District Court drew reasonable inferences from the circumstances, and then found that Jones deleted teh messages with the intent to deprive Riot of using the messages in this suit. The District Court also found that the deleted messages could not be restored or replaced through additional discovery and warranted dismissal.
On appeal, Jones did not contest that she had a duty to preserve, that the texts were deleted, or that the text messages could be restored or replaced — only that her conduct was not willful or prejudicial to Riot. So we’re strictly talking about intent on appeal, and I think we should pause for a moment there and contemplate the idea that Jones’ conduct here was not willful, where she clearly engaged in a pattern of not only deleting messages from her own phone, but coordinating the deletion of messages from the same time from those of her friends. I have to wonder what the value is of making this argument on appeal.
The 9th Circuit disagreed with the plaintiff’s argument. Citing to the 11th Circuit in the Skanska v. Bagelheads case that we covered on Episode 107 on the Case of the Week, as well as the Committee Notes to Rule 37, the Court found that intent is most “naturally understood as involving the willful destruction of evidence with the purpose of avoiding its discovery by an adverse party.” That’s evidence that we clearly have here — willful intent. The Panel also agreed that a district court may consider circumstantial evidence in determining whether a party acted with the intent required for Rule 37(e)(2) sanctions, including the timing of destruction, affirmative steps taken to delete evidence, and selective preservation.
The Court rejected plaintiff’s argument that the expert could not confirm that every deletion of a text message was intentional and instead found that there was circumstantial evidence that Jones “intentionally destroyed a significant number of text messages and collaborated with others to do so.” Essentially, Jones is arguing, hey, you can’t prove that I intentionally deleted these text messages, only that they’re gone. And what the Appellate Court is saying is the District Court has the right to look at a set of circumstantial facts, and those here supported the District Court’s inference that the deletions were intentional. The Circuit Court found that other facts that supported the District Court’s findings:
- Jones could not explain why messages to other employees at the bar were selectively deleted in 2017 and 2018,
- With respect to the 2019 and 2020 messages, the Court pointed out that “’while much of the content of the deleted messages is unknowable,’ a screenshot of a message sent by a witness to Jones but missing from Jones’ phone in its original form ‘shows that Plaintiff deleted at least one message that had a direct bearing on her case'”,
- Jones and one of the witnesses also obtained new phones shortly after they were ordered to hand their devices over for imaging. Neither Jones nor the witnesses produced the earlier phones for imaging, effectively preventing discovery of messages deleted from those phones.
Jones also argued that her production of thousands of other text messages negated the intent and the prejudice requirements of Rule 37(e)(2), essentially saying, we produced thousands of other messages, we shouldn’t be required to produce more, and that should negate the prejudice here. The Court rejected that argument as well, finding that production of some evidence does not excuse destruction of other relevant evidence, and that the report from plaintiff’s own vendor suggested that she deleted texts from the same time periods covered by her productions, meaning that plaintiff engaged in a huge pattern of producing information, knowing that she had destroyed information from those same relevant time periods.
The Court here on appeal makes an interesting point — that Rule 37(e)(2) does not mention prejudice as a prerequisite to sanctions, including dismissal. According to the Court, the Advisory Committee Notes explain that a finding of prejudice was not included as a requirement because:
the finding of intent required by [Rule 37(e)(2)] can support not only an inference that the lost information was unfavorable to the party that intentionally destroyed it, but also an inference that the opposing party was prejudiced by the loss of information that would have favored its position.
That’s an interesting note from the Court here, because we’ve seen an awful lot of analysis as to prejudice on sanctions motions under Rule 37(e)(2). So we’re going to have to compare and contrast the ruling here in Riot to some of the other decisions that we’ve seen previously. The 9th Circuit found that the District Court did rely on that inference as to prejudice here and that reliance was acceptable.
The Court also rejected plaintiff’s arguments that less drastic sanctions could have been imposed to cure the prejudice, finding that the district court expressly considered less drastic sanctions and concluded that none were likely to be effective.
The 9th Circuit stated that “[c]onsidering the nature of the spoliated ESI and Jones and Nathanson’s repeated violations of court orders even after monetary sanctions had been imposed, the District Court’s conclusion was not an abuse of discretion.” Nathanson was Jones’ counsel.
Jones also argued that the District Court’s order requiring her and others to turn over their phones was improperly issued. The 9th Circuit rejected that argument, citing to the case management order and to Arizona rules.
The Court also rejected a challenge to the District Court orders based on privacy issues, noting that while there is a strong privacy issue in the contents of mobile phones, that those privacy issues are either addressed by a protective order or on proportionality grounds under the federal rules. Here, the District Court granted the only protective order that the plaintiff sought on privacy grounds, and that the text messages were clearly proportional to the needs of the case. The Court also found that the facts of this case fit squarely within the decision in Lewis v. Archer Daniels Midland Co., in which the district court noted that courts have allowed neutral experts to examine electronic devices:
when the moving party has sufficiently demonstrated need and inability to obtain relevant information by more conventional means and measures adequate to protect the privacy or commercial concerns of the party who owns the device are imposed.
In essence, the Court says here, look, we gave you every opportunity to turn the information over yourself, but you’ve obviated it in multiple ways, so we’re going to order a third-party neutral.
Finally, the Court also rejected any abuse of discretion as to the District Court’s awarding of costs to the defendant on the motion for sanctions. We didn’t cover it specifically here, but the Court also did allow the admission of the expert report. That was the basis of finding the intentional destruction of the text messages.
Takeaways
What are our takeaways from this decision?
What’s really important here is looking at what the defendant did for the underlying basis of this motion for sanctions. And the reason that defendant was able to make this motion for sanctions and get the case dismissed was by paying very close attention to and comparing the discovery of text messages that they received. Note that the whole issue arose here because the defendant identified gaps in the timing of text messages sent that were consistent between the plaintiff and the other witnesses. You need to make sure that you’ve got tools that can allow you to do this analysis and spend the time early in the case to see what the data tells you. It’s a fundamental principle of ediscovery that to do it effectively, you have to get into the data. That’s what the defendants did here that allowed them to make this motion.
Next, be prepared to ask questions about the data practices of your witnesses at depositions after you have reviewed the data. Here, the witnesses testified that they exchanged messages with the plaintiff during a time when those messages were missing. When you know your data, you can use it and the patterns that you see to help build a case, whether it’s on the merits for a motion to compel or for sanctions, like in this case. If you get in the data, use it to instruct you how to talk to the witnesses, how to follow up, and ask what else should be there?
This decision is another in a series finding intent and dismissing cases for failure to preserve under Rule 37(e)(2). It’s become more important than ever to ensure that you are recognizing the need to preserve data from mobile devices and to work with your clients early on to get that done. There are multiple tools at all cost points to allow you to do that effectively. Plaintiff’s conduct here was clearly intentional, but we are also seeing case law where a pattern of behavior evidencing a failure to preserve can also lead to dismissal even without that intent. Courts are finding that bad faith in failing to preserve equals intent. You can read through those decisions in our 2023 Case Law Report and see the pattern that is emerging. That pattern suggests that text messages and other communication tools used on mobile devices are growing in importance exponentially. Don’t wait until the case is upon you that requires preservation. Instead, actively seek out solutions that will allow you to preserve data from devices proactively to preclude potential sanctions.
Conclusion
That’s our Case of the Week for this week. Thanks so much for joining me. We’ll be back again next week with another decision from our eDiscovery Assistant database.
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