1. Supreme Court
1. Torts
2. Court of Appeals
1. Civil Procedure
2. Contracts
3. Damages
4. Defamation
5. Insurance
6. Torts
3. Federal Court
1. Employment
2. Torts

4. Minnesota Workers' Compensation-Supreme Court
1. Contribution
2. Medical
5. Minnesota Workers' Compensation-Court of Appeals
1. MMI
6. Wisconsin Workers' Compensation
1. There were no updated cases for review as of the printing of this Newsletter.
7. Michigan Workers' Compensation
1. There were no updated cases for review as of the printing of this Newsletter.

8. U.S. District Court

9. Minnesota Court of Appeals

In this breach of confidence, breach of fiduciary duty, invasion of privacy, and civil conspiracy case, the Minnesota Supreme Court examined the absolute privilege rule with regard to statements made prior to a judicial proceeding, that are relevant to the subject matter of the litigation. Here, when a legal secretary provided an affidavit describing certain practices of her former employer, the law firm Mahoney & Hagberg, the Court ruled that because the secretary's statements had reference and relation to the subject matter of the underlying lawsuit, the statements were relevant and subject to absolute privilege. The Court further ruled that absolute privilege with regard to the secretary's statements was not overcome by the fact that her statements sounded in defamation, as absolute privilege from liability for statements made during judicial proceedings bars claims sounding in defamation; that is, claims where the injury stemmed and grew out of the defamation.

The Court of Appeals affirmed the District Court's suppression of evidence and expert testimony on the basis that it had not been timely disclosed to respondent during pretrial discovery. Appellant's counsel argued that he was unable to secure and disclose the identity of expert witnesses until shortly before trial due to the fact of an attorney change that occurred shortly before the discovery deadlines. The Court held that appellant had well over two years to obtain the necessary evidence and expert testimony for trial and while the handling attorney left the law firm during the discovery process, the hardship rendered could have been mitigated by a request for continuance.

The Court of Appeals affirmed the district court's ruling which struck the affirmative defense of insufficiency of service of process from the pleadings as a discovery sanction. Appellant failed to timely disclose the basis of said defense in its answers to interrogatories. Prior to the expiration of the statute of limitations on her claim, respondent requested on several occasions the status of appellant's improper service defense and responses to respondent's interrogatories. After the statute of limitations had run on respondent's claim, appellant disclosed the basis for its defense. The Court of Appeals found the district court's decision was not an abuse of discretion since appellant's failure to provide answers significantly prejudiced respondent even though appellant's failure to supplement its answers was not intentional or in bad faith.

In this case regarding the development and disposition of a 40-acre parcel of real estate in Bullhead City, Arizona, even though the parties negotiated a settlement with the assistance of the District Court, the parties later disagreed on settlement terms. When a motion was filed to enforce the settlement agreement, the District Court relied on its recollection of the settlement negotiations and determined that although the settlement agreement entered into did not specifically describe the type of rezoning which was applied for, the parties intended and agreed that the property would be rezoned as single family residential. On appeal, the Appellate Court determined that the District Court inappropriately asserted inherent judicial power to construe a term of the settlement agreement based on its recollection of the settlement negotiations, rather than on evidence submitted by the parties.

In this case, where a written agreement between two attorneys mixed elements of a loan agreement and a retainer agreement, the District Court granted summary judgment to enforce the terms of the written agreement. The Appellate Court, however, found that genuine issues of material fact remained unresolved. If the Appellate Court were to find that this agreement was merely a loan agreement, it would ignore language that acknowledged one attorney's legal assistance to the other; and if the Court were to view this as a retainer agreement, it must ignore the reference to repayment of a loan. As such, the Appellate Court concluded that the agreement was reasonably susceptible of more than one interpretation; and thus, it was ambiguous.

In this wet house case, the homeowners sued the general contractor after discovering water intrusion damage, and the general contractor initiated third-party actions against several subcontractors. The general contractor subsequently settled with the homeowners, and in exchange the homeowners assigned any claims they had or might have had against the subcontractors and suppliers to the general contractor. After the settlement agreement was signed by the homeowners, but not by the general contractor, a subcontractor requested a copy of the settlement agreement and discovered that it made reference to a Pierringer Release. As a Pierringer Release between the homeowner and the general contractor would extinguish any cause of action that the general contractor had against the subcontractors, the subcontractors filed for summary judgment. In response to the summary judgment motion, the general contractor revised the language in the settlement agreement to clarify that its intent was to retain its third-party claims against the subcontractors. The District Court granted summary judgment for the subcontractors and suppliers and described the revised agreement as appellant's attempt to "recreate a cause of action that was previously extinguished by a Release." The Appellate Court upheld the District Court's ruling that the first settlement agreement controlled but also found that if the revised settlement agreement was the appropriate one to consider, the result would be the same because both agreements were modified Pierringer Releases and dismissed the general contractor's remaining third-party claims against the subcontractors and suppliers. Also, pursuant to Weston, the Court found that where the home was substantially completed in 1993 and the general contractor settled with the owners in 2005, the general contractor's claims for contribution and indemnity were barred because they were not brought within ten years of the completion of the home's construction.

Here, a pro se plaintiff entered into a rental agreement for a storage cubicle. The agreement provided for late fees in the event of a late rental payment. When late fees were assessed against the plaintiff, the plaintiff filed suit in District Court alleging that the storage company's late fees were unreasonable and excessive. The plaintiff sought damages in the amount of $55,000 for the value of the property stored at the self-storage facility as well as an additional $110,000 in damages, attorney's fees, costs, disbursements and statutory fees. The storage facility submitted an Answer and Counterclaim seeking dismissal of the appellant's claim for failure to state a claim upon which relief could be granted and failure to comply with Minn. Stat. § 549.211. Later, after the plaintiff paid his past due rent and the storage company waived the late fees due and terminated the rental agreement, the District Court granted the storage company's motion for summary judgment stating that the plaintiff did not incur any damage and that no controversy continued to exist. The Appellate Court upheld this decision concluding that all of the plaintiff's claims were based upon late fees charged by the respondent and the threatened sale of appellant's property. After the late fees were waived and the plaintiff collected his property, the plaintiff's claims were moot and he had not suffered any injury.

Regardless what form a release may take, as long as it does not constitute an accord and satisfaction or an unqualified or absolute release and there is no manifestation of any intention to the contrary in the agreement, the injured party should be allowed to pursue the remaining wrongdoers until full satisfaction is obtained. For instance, when a settlement agreement does not contain a Pierringer release, the release of one alleged tortfeasor will release the others only if the settlement agreement manifests such an intent or if plaintiff receives full compensation in law or in fact for damages sought against the remaining tortfeasors.

In this case, Market America brought suit against Reinert and Edina Realty seeking joint and several damages totaling $491,726. Under a Settlement Agreement between Market American and Reinert only, Reinert would pay Market America $20,000 for "mutual complete releases and stipulations of dismissal with prejudice and without costs to any party" with no exceptions. The Agreement contained no language reserving Market America's claims against Edina Realty or any agreement by Market America to indemnify Reinert against future claims for contribution from Edina Realty.

The Appellate Court held that the Agreement lacked the essential elements of a Pierringer release; but because neither party to the Agreement intended to release Edina Realty and the $20,000 did not fully compensate Market America, the District Court did not err by allowing Market America to proceed to trial against Edina Realty.

The Court of Appeals affirmed the District Court's finding that RPC Properties was not entitled to consequential damages. In 2000, the parties contracted to allow VoiceStream to place antenna equipment on the roof of one of RPC's buildings. Subsequently, RPC alleged that the equipment damaged the roof and caused a leak. After suit was initiated, the parties reached a mediated settlement that required VoiceStream to remove its equipment to allow repairs to be made to the roof. The agreement did not specify a time when this was to be completed. VoiceStream failed to remove the equipment for four months after the settlement. RPC brought a motion seeking to enforce the settlement agreement as well as attorneys fees and consequential damages. The District Court granted RPC's motion for attorney fees but denied the claim for consequential damages. The Court of Appeals found that the District Court did not abuse its discretion by denying consequential damages because the landlord did not submit evidence proving that its damages flowed from VoiceStream's unreasonable delay in removing the equipment.

In this defamation suit, the Court of Appeals affirmed in part, reversed in part, and remanded after concluding that (1) calling a police officer "Pat the Pedophile" was defamatory per se; (2) the officer was not entitled to special or punitive damages; (3) the evidence was sufficient to establish a causal relationship between the defamatory statement and general damages; and (4) the evidence did not support the amount of the jury's award for general damages. The District Court had directed entry of judgment for the name-caller despite the jury's award to the officer of $573,000 for harm to reputation, mental distress, humiliation, embarrassment, health-care expenses, wage loss, and punitive damages.

Longbehn was a 34-year-old police officer who started a romantic relationship with an 18-year-old woman. One evening, Longbehn's acquaintance, Wilson, was driving home from a party with Schoenrock's daughter. Wilson became engaged in a cell-phone conversation with Schoenrock, who stated that if Wilson did not bring his daughter home, he would call "Pat the Pedophile." The City of Moose Lake terminated Longbehn, in part because members of the community referred to him as "Pat the Pedophile."

The Minnesota Court of Appeals affirmed the District Court's ruling that when an individual, who owns and is operating a vehicle that is insured by his employer, is injured in a motor-vehicle accident with an uninsured driver, the Minnesota No-Fault Act does not bar the individual from recovering excess uninsured-motorist benefits from an insurer that provides coverage on a different family vehicle. Plaintiff was driving in the course and scope of his employment as a courier and was injured in a car accident. Plaintiff owned the vehicle involved in the accident, but it was insured under his employer's policy which had UIM coverage. The at-fault driver was determined to be uninsured. Plaintiff then filed a claim against Illinois Farmers seeking excess uninsured benefits from a vehicle owned by his wife that was not involved in the accident. The Court also ruled that the family vehicle exclusion language of the insurance policy covering the wife's vehicle was unenforceable.

Here, the Court determined that a special relationship between plaintiff Bjerke and respondent Johnson existed under Restatement (Second) of Torts, § 324A(b) and that the special relationship was sufficient to trigger a duty to protect Bjerke from reasonably foreseeable third-party criminal acts. When Bjerke's parents entrusted her care as a minor child to Johnson while Bjerke lived on Johnson's horse farm, by accepting that entrustment, Johnson undertook the parents' duty to protect Bjerke from Johnson's boyfriend, Bohlman, who subsequently physically and sexually abused Bjerke. Having found that Bjerke and Johnson had a special relationship under Restatement (Second) of Torts, § 324A (1965) and also that genuine issues of material fact remained as to whether Bohlman's sexual abuse of Bjerke was foreseeable, the Appellate Court ruled that the District Court had erred by granting summary judgment to dismiss Bjerke's negligence claim against Johnson.

The violation of a traffic statute does not constitute negligence per se but is prima facie evidence of negligence. Therefore, a party who violates a traffic statute is presumed negligent but can present rebuttable evidence that the violation was not negligent under the circumstances. The Appellate Court reversed and remanded a District Court's judgment because it misapplied a non-rebuttable negligence-per-se standard instead of applying a rebuttable prima-facie evidence standard.

In this case, Berg was riding her bicycle across a pedestrian crosswalk when she was hit by Roth's car. Although Roth failed to yield to a pedestrian having the right-of-way, the Appellate Court found that her actions were justified under the circumstances. The Appellate Court concluded that the District Court erred in entering judgment as a matter of law because reasonable minds could determine that Berg was also negligent.

In this case, the Court reviewed whether "after-acquired" evidence can be considered on the question of whether the plaintiff was capable of performing the essential functions of her job to determine whether the plaintiff was entitled to intermittent leave under the Family and Medical Leave Act ("FMLA). The Court also reviewed whether such after-acquired evidence could be considered as to the disability discrimination and Minnesota Human Rights Act ("MHRA") claim of the plaintiff. Here, after being fired for excessive absenteeism, the plaintiff brought action against her employer asserting claims of interference under FMLA and the MHRA. The Court granted summary judgment to her employer on the FMLA claim on the basis that (1) the plaintiff suffered from factitious disorder, borderline personality disorder, and drug dependence; (2) plaintiff suffered from these conditions while she was employed by defendant; and (3) plaintiff was therefore not qualified to perform the essential functions of her position as a physician's assistant. The Court noted that plaintiff offered virtually nothing to contradict these conclusions and noted that "an employee who [cannot] otherwise perform the essential functions of her job, apart from the inability to work a full-time schedule, is not entitled to intermittent or reduced scheduled leave."

The Court also granted summary judgment to the employer on the MHRA claims of disability discrimination and failure to accommodate noting that the after-acquired evidence of plaintiff's health problems properly barred her discrimination claim because in order to prevail under the MHRA, plaintiff must present evidence from which a reasonable jury could include (1) that she was disabled within the meaning of the MHRA; (2) that she was qualified to perform the essential functions of the job with or without reasonable accommodation; and (3) that she suffered an adverse employment action because of her disability. The employer's uncontradicted evidence demonstrated that plaintiff was mentally ill, dependent on drugs and, therefore, unqualified for her position as a physician assistant, which barred her from recovering under the MHRA.

The U.S. District Court granted summary judgment against the plaintiff holding that the plaintiff could not prevail on his Minnesota Human Rights Act ("MHRA") claim for failure to make reasonable accommodation because he conceded that he did not have a physical impairment that materially limited a major life activity. In holding thus, the Court interpreted the MHRA definition of a disability by the logic used in Weber v. Strippit, Inc., 186 F.3d 907 (8th Cir. 1999), which did not require reasonable accommodation of employees who are only "regarded as" disabled, rather than having "a physical or mental impairment that substantially limits one or more major life activities." The Court reasoned that perverse results would occur if "regarded as" employees could maintain a reasonable accommodation claim under the MHRA, and therefore Andersen was entitled to summary judgment on McLain's failure to accommodate claim.

In this personal injury case, the Court determined that it had personal jurisdiction over a manufacturer based in England. Although (1) the manufacturer had no offices, employees, or agents in Minnesota; (2) had assigned all rights to distribute, market, and label the machines to another entity; (3) American customer requests were handled through a separate company; (4) the manufacturer did not direct any advertising toward Minnesota; and (5) only one machine was ever sold into Minnesota; the Court found that the manufacturer had a long-lasting distribution network to service the United States, knew the machine at issue was being manufactured for use in Minnesota, and associated its logo with the machine sold into Minnesota. Finally, the Court held that while travel from England presented a hardship for the manufacturer's sole employee, the witnesses and injury were located in Minnesota, and the plaintiff did not have the funds to travel to England.

This case explores the issues of constructive notice and actual notice as applied to a slip and fall situation in a Costco store. In granting summary judgment to Costco, the Court ruled that plaintiff had offered no evidence that Costco or its employees had negligently caused a rug in the store's entryway to bunch up. The Court ruled that Costco had no constructive notice of the condition because, as there was testimony that Costco checked the rugs every hour, the rug corner that the plaintiff allegedly fell over could not have been turned up for more than 20 to 30 minutes. The Court finally ruled that Costco did not have actual notice that its practice of using the rugs constituted a continuing danger to the store's customers because there was no evidence that any Costco employee knew that the rug in question was bunched up before the plaintiff fell. Simply because a property owner is aware that a type of hazard may occur does not mean that the owner has actual knowledge at the particular time that the hazard occurs.

In this suit involving numerous patents owned by the plaintiff and defendants for automatic external defibrillators, the District Court partially granted the defendants' motion to enforce a prior order and strike an expert witness report. In the previous order, the Court allowed the plaintiff to substitute one expert for another but required that the new expert's testimony be consistent with the original expert's opening report and conclusions. The Court enforced its previous order, striking the new expert's contradictory and new opinions. But the Court allowed the new expert to duplicate opinions that were part of the original expert's rebuttal report. The Court reasoned that there was no prejudice to the plaintiff, which had an opportunity to submit a reply to the rebuttal report, depose the original expert, and depose the new expert at the defendants' expense.

The employee in this case filed a workers' compensation claim against two former employers and their insurers, Met Con Companies/State Fund Mutual Companies and Gresser Companies/Zurich Insurance Company. Gresser filed a Petition for Contribution against Met Con. Gresser then commenced payment of benefits pursuant to a Temporary Order. Thereafter, Gresser and the employee reached a lump sum settlement of all claims, except future medical expenses at a mediation. Met Con was invited to join the mediation, but declined. A Stipulation for Settlement between the employee and Gresser stated, among other things, that (1) employee accepted the lump sum payment as a full, final and complete settlement of all past, present, or future claims that he might have against Gresser and Met Con, except claims for future medical expenses; (2) Gresser preserved its claim for contribution and reimbursement against Met Con; (3) the settlement did not limit any defense that Met Con may have against the Employee; (4) Gresser would pay the employee a lump sum; and (5) the employee would assign to Gresser all rights he had against Met Con. At the hearing on this matter, the compensation judge found Met Con was liable to the employee for benefits and that Gresser's settlement with the employee was reasonable. The compensation judge awarded Gresser contribution for paid benefits, including the attainment of the lump sum settlement. The Workers' Compensation Court of Appeals affirmed the finding that Met Con was liable to the employee, but reversed on Met Con's liability for contribution concluding that the settlement could not be enforced against Met Con because Met Con was not a party to this settlement and Met Con could not be required to contribute for benefits that Gresser had paid but that had not yet accrued.

The WCCA also affirmed the rejection of Met Con's statute of limitation defense. The compensation judge had previously found Met Con's statute of limitations defense failed because the payments Met Con had made to the employee, before Met Con denied liability, tolled the statute of limitations.

The Minnesota Supreme Court affirmed the WCCA's ruling regarding the statute of limitations. Met Con's payment of benefits to and on behalf of the employee are considered "proceedings" under Minn. Stat. . 176.151, and are significant to toll the statute of limitations, even though Met Con filed a second Notice of Insurer's Primary Liability denying the claim within the required time period.

The Supreme Court reversed the WCCA's opinion regarding the contribution claim. The Court noted that under the common law of contribution the fact that one of the liable persons was not a party to a settlement is not an obstacle to contribution. Second, the Court agreed that basic fairness requires the parties in a workers' compensation proceeding be afforded reasonable notice and an opportunity to be heard before decisions concerning entitlement to benefits can be made, however, the Court also noted the Gresser settlement did not purport to establish Met Con's liability to the employee. Instead, Met Con had a full opportunity to defend against liability to the employee during the evidentiary hearing on Gresser's contribution claim. Lastly, the Court faced the issue of whether a non-settling employer/insurer can be required to contribute to a lump sum settlement that includes payment for benefits that have not yet accrued. The Court held the compensation judge does have jurisdiction to award contribution based on a settlement which includes future benefits. That jurisdiction is reinforced by the statutory authorization of a compensation judge to approve settlements that include future benefits and to compute an employer's liability for future benefits into a lump sum amount.

The employee in this case filed a Claim Petition seeking payment of outstanding medical and chiropractic treatment expenses for Gillette injuries. The employee underwent an independent medical examination with a neurologist on October 26, 2004, at the request of the School District. The doctor concluded the employee had not sustained any type of repetitive trauma or Gillette-type injury and had no permanent injuries as a result of her job as a sign language interpreter. In February 2005, the parties held a settlement conference where no settlement was reached. On March 29, 2005, the School District filed a motion for an examination by a neutral physician pursuant to Minn. Stat. § 176.155, subd. 2. In its request, the School District said that a dispute exists as to whether the employee sustained a work injury and, if so, the nature and extent of such injury. Because "of the disputes herein," the School District argued that Minn. Stat. § 176.155, subd. 2, required the appointment of a neutral physician. On April 7, 2005, a Notice of Hearing was filed scheduling the matter for a hearing on August 5, 2005. In a letter dated June 13, 2005, the School District requested an Order on its motion for a neutral-physician examination, or, in the alternative, a continuance. The employee then objected to the designation of a neutral physician asserting that "in view of the upcoming hearing, it would be untimely to try to secure this opinion." A compensation judge denied the School District's motion. The hearing was held as scheduled. The compensation judge found the employee sustained Gillette-type injuries and awarded compensation for permanent partial disability. By panel majority, the WCCA also affirmed the compensation judge's denial of the School District's request for a neutral-physician examination. The School District challenged only the denial of the neutral-physician examination.

On appeal to the Minnesota Supreme Court, the School District argued its request fell within the provision of Minn. Stat. § 176.155, subd. 2, which states that "when an interested party requests, not later than 30 days prior to a scheduled prehearing conference, that a neutral physician be designated, the compensation judge shall make such a designation." The Court held the plain language of the statute does not make a prehearing conference such a condition or a condition to a neutral examination. The Court held subdivision 2 is not ambiguous and must be read so as to give effect to all of its provisions. The first provision gives the compensation judge the discretion to appoint a neutral physician when she believes it is necessary, even if there has not been a request by the parties. This provision also gives the compensation judge discretion to appoint a neutral physician when a party has made a request but the request is not timely because the request is made less than 30 days before the prehearing conference. The second provision removes this discretion when a party has made a request and the request falls within the time deadline provided - not later than 30 days before a scheduled prehearing conference. Thus the compensation judge had no discretion to deny the School District's request for a neutral examination.

The employee appealed from the compensation judge's finding that she had reached maximum medical improvement ("MMI") and the resultant discontinuance of her temporary total disability benefits. On August 23, 2005, the appellant injured her low back while attempting to catch a box of hinges as it fell. She sought medical attention and was diagnosed with a lumbar strain. She was treated with medication and provided restrictions. On September 8, 2005, she began chiropractic treatment and shortly thereafter underwent an MRI of the lumbar spine. The MRI was read to show a subligamentous disc herniation at the L5-S1 level with corresponding impingement on the S1 nerve root. She continued with chiropractic treatment and was released to work on a part-time basis on November 22, 2005. Upon return to work, she noted an exacerbation of pain and was again taken off work. The appellant has not returned to work since that time.

On December 7, 2005, the appellant underwent an independent medical examination. The examiner found her low back condition to be causally related to the August 23, 2005, incident. The examiner further found that the chiropractic care was not appropriate and recommended a lumbar epidural steroid injection. He opined, that if the injection was not successful, a microdiscectomy should then be performed.

On January 18, 2006, the appellant was referred to a neurosurgeon complaining of continuous low back pain, bilateral weakness of her lower extremities, and pain and numbness in her left leg. The surgeon noted the appellant's hesitancy over undergoing surgery and that her current conservative treatment has not resulted in any significant improvement of her condition. He concluded that in the long run she is probably going to need surgery.

The appellant was subsequently referred to the Midway Pain Center. The Center recommended medication, physical therapy at MAPS, and an epidural steroid injection. In accordance with the recommendations she underwent an injection at the L5-S1 level on March 7, 2006, and commenced physical therapy. The records demonstrate that neither the injection or therapy produced a significant or long lasting change in her pain symptoms.

On June 7, 2006, the appellant was re-evaluated by the independent medical examiner. The examiner now opined that she had reached maximum medical improvement provided that she does not elect to have surgery. He further released the appellant to work with permanent restrictions. The appellant sought a second opinion from Dr. Alfonso Morales. Dr. Morales reviewed her medical records and issued a report stating that the appellant had not reached maximum medical improvement "due to the fact the patient has not undergone surgery." He further recommended physical therapy, epidural steroid injections, myofascial trigger point injections, and pool therapy.

On June 19, 2006, the employer and insurer filed an NOID seeking to discontinue temporary total disability benefits on the grounds that appellant had reached maximum medical improvement based upon the IME report and the expiration of the 90-day period set forth in Minn. Stat. § 176.101, subd. 1(j). The appellant objected and an administrative conference was held on September 19, 2006. In her Findings and Order filed October 4, 2006, the compensation judge found that "the employee's continuation of prescribed non-surgical medical treatment does not support a reasonable expectation of future improvement." The compensation judge adopted the opinion of the neurosurgeon and further found that the employee had attained maximum medical improvement since she had chosen not to have surgery. As a result, the employee's temporary total disability benefits were discontinued as of September 11, 2006.

The WCCA concluded that there was substantial evidence in the record which supports a finding of MMI as of June 7, 2006 and thus affirmed the findings of the compensation judge. The WCCA reasoned that the real issue is a question of what is the appropriate medical care for the appellant and not an issue of whether appellant refused surgery. The WCCA held there is no current recommendation for surgery and that the evidence demonstrated that the conservative care provided to appellant from the date of injury did not result in any significant improvement of her condition. In addition, the WCCA found there is no evidence which would suggest a substantial improvement in the employee's condition could reasonably be anticipated. As a result, the date of MMI found by the compensation judge was affirmed.

There were no updated cases for review as of the printing of this Newsletter.

There were no updated cases for review as of the printing of this Newsletter.

IIn this breach of contract case, the Court ruled that no sanction less than default judgment and reasonable attorney fees and costs would sufficiently punish and deter the defendant's abusive conduct. Among other things, the Court found that defendant had lied under oath and failed to produce "smoking-gun" e-mail evidence of the breach.

In this sexual harassment suit involving the Orlando Police Department's undercover drug unit, the Court refused to impose sanctions on the defendant city for failing to preserve e-mail and hard-drive data when litigation became foreseeable. The defendant had replaced its employees' computers and had overwritten backup tapes pursuant to city policy by the time the plaintiff served discovery requests. The Court found that the defendant's failure to preserve electronic evidence was harmless because hard copies of the same information existed. It further found that the existing procedures for overwriting data precluded finding bad faith destruction of evidence. Notably, in response to a request for the production of sexually explicit documents, the city's internet security administrator spent approximately 300 hours auditing backup tapes and e-mail accounts concerning five officers.

In this action involving federal securities laws violations, the Court imposed adverse inference instruction sanctions because the defendant failed to preserve documents and electronically stored information.

NTL, Inc. ("Old NTL") circulated document-hold memoranda to its employees concerning possible litigation prior to filing bankruptcy. After the bankruptcy, Old NTL emerged as NTL Europe and NTL, Inc. ("NTL"). Lawsuits proceeded against NTL Europe, while NTL became the operational company. NTL's counsel told plaintiffs' counsel that responsive e-mails did not exist because the computer servers had been "upgraded." NTL Europe argued that it could not produce Old NTL documents because NTL had possession of them.

The Court found that NTL Europe had a duty to preserve evidence, determining that (a) the duty to preserve attached when Old NTL could reasonably anticipate litigation; (b) Old NTL knew to preserve the documents listed in its document-hold memoranda; and (c) NTL Europe either had "control" of the documents pursuant to a demerger agreement, or allowed spoliation by failing to make copies before turning documents over to NTL or by failing to have a sufficient litigation hold in place following Old NTL's duty to preserve evidence.

The Court also found that NTL Europe's failure to preserve documents and electronically stored information was grossly negligent and that NTL Europe had a sufficiently culpable state of mind to warrant spoliation sanctions, because many employees never received the Old NTL document-hold memoranda, neither NTL Europe nor NTL ever reminded employees about the hold, NTL's IT system was outsourced to IBM, which was not instructed to have a hold in place, and no steps were taken to continue the hold after the bankruptcy.

This case provides an example of what a Court's document production instructions may look like under the new federal rules. All responsive hard copy and electronic documents were to be produced in single-page Tagged Image File Format ("TIFF") with an accompanying load file, an extracted text file of unredacted electronic documents, and an Optical Character Recognition ("OCR") text file of redacted documents. To the extent possible, court-selected metadata fields were to be provided for each document. Each party was to bear the expense of processing and reviewing its electronically stored information ("ESI"). The parties were to determine who would pay the costs to process and review inaccessible or legacy ESI.

The Court also ordered the preservation of "documents, data, and tangible things," such as records, files, calendars, diaries, electronic messages, voice mail, e-mail, telephone message records or logs, computer and network activity logs, hard drives, backup data, removable computer storage media, document image files, web pages, databases, spreadsheets, software, and digital recordings among other things. The Court reiterated the attorneys' obligation to "exercise all reasonable efforts to identify and notify parties and nonparties," including their employees, to preserve all potentially relevant documents, data, and tangible things.

The Court in this class action granted plaintiffs' application for a protective order exempting them from producing native-format electronic data but refused to allow such relief prospectively. The Court found that plaintiffs ran afoul of Rule 34 because they removed metadata through a laborious process of printing electronic documents, creating TIFF images from the printouts, and then converting the images back into electronic text that could be searched with OCR software. Because plaintiffs had provided a significant amount of discovery and heard no objections for several months, the Court held that it would be overly burdensome to force the plaintiffs to re-produce data in native format.

In this train derailment accident case, the Court allowed the plaintiffs to depose a computer forensics expert retained by the defendants in order to "insure that any 'tradition' of destroying derailment-related documents be discovered and brought to an end." After a Soo Line manager destroyed e-mails regarding the derailment, the defendants hired a forensics expert to determine if the data could be recovered. The plaintiffs sought to discover the results of that investigation. The defendants resisted, arguing that because the Court lacked jurisdiction and the suit was preempted by federal law, there was no risk to the plaintiffs and the information was irrelevant. The Court invoked its inherent authority to determine whether its processes had been suborned and denied the defendants' "no harm, no foul" arguments.

In this patent infringement case, the Court upheld sanctions against the defendant for, among other things, (1) failing to reasonably inquire whether its employees had potentially relevant e-mail and files, (2) failing to instigate a company-wide litigation hold by instructing employees to retain documents relevant to the pending litigation, and (3) giving conflicting testimony regarding whether e-mail had been deleted. Sanctions included adverse inference instructions and an award of attorney fees and costs.

The Appellate Court reversed sanctions that precluded an attorney from (1) appearing before the Court, (2) submitting affidavits, and (3) representing any facts to the Court. The attorney's client had been ordered to turn his computer over to a court-appointed receiver, after which the attorney would be allowed to determine if information on the computer was privileged. The receiver hired an expert, who determined that e-mails had been deleted or moved from the computer. The District Court found that the attorney had instructed his client to turn on the computer and look at information on the computer before turning it over. The Court also found that the attorney or his client were responsible for deleting hundreds of e-mails; and that the attorney had been untruthful to the Court, had impeded discovery, had violated the Court's Order, and had engaged in spoliation of evidence that would not have been discovered without expert services. The Court of Appeals reversed the sanctions because the District Court failed to give proper notice of a proceeding involving sanctions against an attorney.