August 30, 2016 Articles

Discovery Sanctions under Amended Rule 37(e): A Safe(r) Harbor

Early decisions applying the new Rule 37(e) should give comfort to potential litigants who have worked in good faith to preserve potentially relevant ESI.

By Michael J. Miles and Jeffrey E. Jakob

On December 1, 2015, the latest amendments to the Federal Rules of Civil Procedure went into effect, including a totally revamped Rule 37(e):


(e) Failure to Preserve Electronically Stored Information. Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system. If electronically stored information that should have been preserved in the anticipation or conduct of litigation is lost because a party failed to take reasonable steps to preserve it, and it cannot be restored or replaced through additional discovery, the court:

(1) upon finding prejudice to another party from loss of the information, may order measures no greater than necessary to cure the prejudice; or

(2) only upon finding that the party acted with the intent to deprive another party of the information’s use in the litigation may:


(A) presume that the lost information was unfavorable to the party;

(B) instruct the jury that it may or must presume the information was unfavorable to the party; or


(C) dismiss the action or enter a default judgment.

The original purpose of Rule 37(e) was to provide a safe harbor for litigants who lost electronically stored information (ESI) in the “routine, good-faith operation of an electronic information system.” See Fed. R. Civ. P. 37 advisory committee’s note to 2006 amendment (. However, the rule’s broad language allowed for the development of standards that varied significantly among the circuit courts. Preservation efforts (or lack thereof) resulting in relatively minor sanctions in one circuit could lead to the most Draconian measures in another circuit, and it was not uncommon for courts to rely on their inherent authority in determining sanctions. As noted by the Advisory Committee, such uncertainty bred an overly cautious mentality among potential litigants, which caused them to “expend excessive effort and money on preservation in order to avoid the risk of severe sanctions if a court finds they did not do enough.” Fed. R. Civ. P. 37 advisory committee’s note to 2015 amendment. Thus, an important goal of the latest revisions to Rule 37(e) was to address the problem of the overpreservation of ESI with its attendant costs and burdens by providing uniformity and predictability to the world of e-discovery sanctions.

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