For many years the sanctions available for the spoliation of electronically stored information (ESI) were largely similar in both the New York federal and state courts. New York state court decisions frequently tracked the federal common law spoliation analysis, most notably set out in the Southern District of New York’s Zubulake v. UBS Warburg and Pension Comm. of Univ. of Montreal Pension Plan v. Banc of Am. Secs. line of cases.1 This analysis allowed for severe—and sometimes case-terminating—sanctions, such as adverse inference instructions, dismissal of claims or counterclaims, or outright dismissal of actions, for both grossly negligent or intentional spoliation. However, in the past year, with the passage of the December 2015 amendments to the Federal Rules of Civil Procedure (the Rules), the measure for spoliation and accompanying sanctions in New York state and federal courts has diverged.
Under the Federal Rules
Among the December 2015 amendments to the Rules was a significant rewrite of Rule 37(e), which addresses sanctions available for the failure to preserve ESI. Under the revised rule, sanctions are only available if ESI “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 amendment’s most notable departure from certain jurisprudence developed within the Second Circuit concerns remedies available for negligent spoliation, in contrast to the remedies available only for intentional spoliation. Neither set of remedies can be reached now unless the ESI is actually lost—entirely irretrievable from another source or party.
