"Reckless Disregard" May Suffice for Spoliation Sanction

By Sean T. Carnathan, Litigation News Associate Editor – March 26, 2013

Accusations of spoliation are commonplace in modern litigation. You can count on discovery requests to probe the extent of your client's efforts to gather and preserve evidence in nearly every case. When evidence gets destroyed, there will be trouble.

The level of scienter or bad intent generally determines the sanction, if any. Most courts outside the Second Circuit require something more than negligence before imposing significant sanctions on the culpable party. Where to draw the sanctions line in the absence of actual malice is tricky business. Courts do not like motions for spoliation sanctions, but they like parties who destroy evidence even less.

Reckless Disregard Held Sufficient
In a recent decision, Bozic v. City of Washington, the United States District Court for the Western District of Pennsylvania tackled this question of where the line should be drawn for spoliation sanctions. The court ultimately ordered an adverse inference instruction to the jury, finding “reckless disregard” by the culpable party was sufficient for an award of spoliation sanctions.

Plaintiff Bozic was a firefighter. The city terminated her employment, alleging she had falsely reported her residence and that she had other performance issues. Bozic asserted the termination was in retaliation for a prior complaint she had filed against the city with the Equal Employment Opportunity Commission (EEOC).

Shortly before her termination, Bozic met with the city solicitor, who allegedly told her the city's claimed bases for termination. Bozic hotly contested what was actually said at the meeting. The solicitor taped the meeting on a handheld dictation recorder, which would have established the truth of each side's account of the meeting.

Unfortunately, after an unemployment compensation hearing at which the city prevailed, but well within the time for Bozic to file further charges with the EEOC, the solicitor taped over the audiotape. The court found difficult to accept the solicitor’s assertion that he believed the threat of litigation had passed after the unemployment hearing.

During the litigation on her retaliation complaint, Bozic argued that the solicitor inappropriately destroyed the audiotape, and such destruction warranted spoliation sanctions. The district court agreed. Even though the court concluded that the attorney did not act with “the specific malicious intent of keeping the record of the meeting from [the plaintiff] or the court,” it found when the attorney destroyed the tape, it was reasonably foreseeable that litigation might still ensue.

Under these circumstances, the court concluded the attorney acted with sufficiently bad intent to warrant sanctions. Specifically, the court found that the attorney acted with “reckless disregard for the consequences of intentional and conscious destruction of evidence, previously specially preserved for the purposes of subsequent litigation, at a time when litigation [was] necessarily foreseeable.” It held this reckless disregard constituted bad faith sufficient to warrant the sanction of an adverse inference instruction to the jury.

Serious Business
In a lengthy footnote, the court recognized that “[s]anctions motions addressing claimed spoliation of evidence are serious business,” not only because they are expensive to litigate, but because they involve the reputations of the people involved. The court "enter[ed] the spoliations/sanctions thicket out of necessity, but with great caution."

Adverse Inference Standards Vary Among the Circuits
This case is one of the first cases to decide that a “reckless disregard” standard, which some feel is akin to a “negligence standard,” will apply to a decision as to whether spoliation sanctions should be awarded. A survey of the circuits shows that most courts require more than negligence before they will find bad faith sufficient to warrant an adverse inference sanction for spoliation. In fact, they often require a showing of malice.

On the other hand, even though courts have not used the words “reckless disregard” in their opinions, it seems clear that when parties have proven there was destruction of evidence that appears intended to deny that evidence to the other side, courts will generally award an adverse inference sanction. The difficulty, of course, is that the waters of intent are murky, and parties rarely admit to intentional wrongdoing.

The Bozic case is different from other cases because it analyzes the level of intent based on an objective assessment of the facts as opposed to simply analyzing whether “intent” was present and its legal ramifications. Arguably, even an assertion that the party who destroyed the evidence believed that the threat of litigation has passed may have the court deem the defending party to have "recklessly disregarded" its obligations, so that the court finds sufficient bad faith to warrant an adverse inference instruction.

"I do not think Bozic goes so far as to hold that a reckless disregard in general is a sufficient showing to obtain an adverse inference instruction sanction," says Michael A. Wilder, Chicago, cochair of the ABA Section of Litigation’s Ethics and Professionalism Committee Hot Topics Subcommittee. Rather, Bozic demonstrates the greyness of the area between 'intentional and conscious destruction of evidence' and a 'reckless disregard' for the importance of preserving evidence. I read this case to state that a reckless disregard for evidence could lead to sanctions, but sanctions are much more likely if the behavior appears to be reckless and somewhat intentional in nature," says Wilder.

Sanction Warranted Here
“Courts are careful, in my experience, to recognize that assessing blame (and sanctions) can be difficult. Many situations are more complicated than they seem on their face. Sanctions are serious business and should only, in my view, occur in the most egregious of cases,” says Joan Archer, cochair of the Section of Litigation’s Pretrial Practice and Discovery Committee.

Here, the city solicitor admitted he knowingly taped over the meeting tape at a time when the statute of limitations had not yet run on the plaintiff's discrimination claim. Given that she had filed such a claim before, it was objectively unreasonable to destroy the tape. Under the circumstances, Archer agrees that “the fact that the tape was saved because [the solicitor] knew it could be relevant and then was later destroyed warranted the adverse inference sanction.”

Keywords: spoliation, scienter, bad faith, discovery sanctions