Spoliation on the High Seas: Call for Uniform Treatment in Spoliation of Evidence Claims

The BP oil spill is the gift that keeps on giving.[1] Since the blowout on the Deepwater Horizon drilling rig in 2010—nearly five years ago—there are legal proceedings stemming from the incident that are still pending.[2] Of these, there are allegations of evidentiary spoliation against many involved in the spill.[3] These claims have illustrated that there is little guidance on the treatment of evidentiary spoliation; thus, the proposed amendment to Federal Rule of Civil Procedure 37(e) should be adopted to provide uniform guidelines for federal courts handling these claims.

I. Spoliation Generally

“When evidence relevant to litigation is lost, the consequences on the party that the evidence favored can be grave. In certain instances, the loss of a single piece of critical evidence can result in a complete inability to prove a valid claim or defense.”[4]

Under the doctrine of spoliation of evidence, generally defined as “the destruction of relevant evidence by a party or his agent,” the court may “generally impose[] some sanction on the party responsible for the destruction of the evidence.”[5] However, spoliation can be either negligent or intentional and warrant both civil and criminal sanctions, depending on the jurisdiction. Federal courts have adopted a variety of inconsistent “remedies for spoliation of evidence, ranging from discovery sanctions and presumptions to default,” in addition to criminal fines and imprisonment.[6] In a spoliation of evidence claim where someone “intentionally destroys, mutilates, or alters evidence, and thereby interferes with a person’s prospective or actual civil action against either the spoliator or a third person,” the spoliator may be liable for his or her intentional act.[7]

II. Sentencing the Spoliator

Most recently in the BP litigation, Anthony Badalamenti, former Halliburton manager, was sentenced to one year of probation for destruction of evidence in the aftermath of the BP oil spill.[8] The charge stemmed from allegations that Badalamenti “instructed two Halliburton employees to delete data during a post-spill review of the cement job on BP’s blown-out Macondo well.”[9] In response, he pleaded guilty to one misdemeanor count of destruction of evidence.[10]

Prosecutors involved in the case calculated sentencing guidelines calling for “a sentence ranging from probation to six months in prison.”[11] And even though Badalamenti’s sentence could have been a maximum of one year in prison and a $100,000 fine,[12] U.S. District Judge Jay Zainey only sentenced him to probation, consisting of 100 hours of community service and a $1,000 fine, because he felt Badalamenti was an “honorable man” and had “no doubt” that he “learned from this mistake.”[13]

Although Badalamenti received a “reasonable” sentence, some of his colleagues did not fare as well.[14] Of those charged with related crimes, a BP drilling engineer was found guilty of “trying to obstruct a federal probe of the spill” because he deleted text messages between him and a BP supervisor and “faces a maximum sentence of 20 years in prison and a $250,000 fine.”[15] A former BP executive “was charged with concealing information from Congress about the amount of oil” released into the Gulf.[16] Despite the fact that all of these criminal proceedings stem from the BP litigation, courts’ approaches to the spoliation charges vary wildly.

III. Call for Uniform Treatment in Spoliation of Evidence Claims

Because there has been a push for heightened industry regulation following the BP oil spill, it would be well supported to include spoliation of evidence in these discussions. Spoliation of evidence is a relatively new, consistently evolving area of the law—broadly ranging from civil to criminal treatment, even in cases arising from a single incident. To further complicate the matter, many jurisdictions differ in their handling of such claims, making it difficult to educate litigants and upper-level employees with access to documents on how to maintain potentially discoverable material. As such, a more streamlined treatment of spoliation claims would help employers better train their employees on how to handle disaster response, where they must use the utmost care in preserving evidence in preparation for litigation.

In fact, the Discovery Subcommittee of the Civil Rules Advisory Committee has proposed an amendment to the Federal Rules of Civil Procedure to better address spoliation claims.[17] In its current form, Rule 37(e) governs failure to preserve discoverable information and reads as follows:

Rule 37. Failure to Make Disclosures or to Cooperate in Discovery; Sanctions

*****

(e) Failure to Provide 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.[18]

This version is largely viewed by practitioners as a “safe haven,” discouraging courts from imposing sanctions “[a]bsent exceptional circumstances.”[19] In the fall of 2012, “the advisory committee voted to recommend approval of [the following] revisions of Rule 37(e)”:[20]

Rule 37. Failure to Make Disclosures or to Cooperate in Discovery; Sanctions 

*****

(e) Failure to Preserve Discoverable Information.

(1) Curative measures; sanctions. If a party failed to preserve discoverable information that should have been preserved in the anticipation or conduct of litigation, the court may:

(A) permit additional discovery, order curative measures, or order the party to pay the reasonable expenses, including attorney’s fees, caused by the failure; and

(B) impose any sanction listed in Rule 37(b)(2)(A) or give an adverse-inference jury instruction, but only if the court finds that the party’s actions:

(i) caused substantial prejudice in the litigation and were willful or in bad faith; or

(ii) irreparably deprived a party of any meaningful opportunity to present or defend against the claims in the litigation.

(2) Factors to be considered in assessing a party’s conduct. The court should consider all relevant factors in determining whether a party failed to preserve discoverable information that should have been preserved in the anticipation or conduct of litigation, and whether the failure was willful or in bad faith. The factors include:

(A) the extent to which the party was on notice that litigation was likely and that the information would be discoverable;

(B) the reasonableness of the party’s efforts to preserve the information;

(C) whether the party received a request to preserve information, whether the request was clear and reasonable, and whether the person who made it and the party consulted in good faith about the scope of preservation;

(D) the proportionality of the preservation efforts to any anticipated or ongoing litigation; and

(E) whether the party timely sought the court’s guidance on any unresolved disputes about preserving discoverable information.[21]

The aim of this amendment was to “provide both remedies and sanctions for failure to preserve discoverable information that should have been preserved. In addition, [it] describe[d] factors to be considered both in determining whether information should have been preserved and also in determining whether a failure was willful or in bad faith.”[22]

This proposal was viewed as a step in the right direction; however, the Subcommittee has made additional changes after receiving public comment.[23] Concern over the breadth of proposed Rule 37(e) extending past electronically stored information (ESI), the fear of over-preservation, and a lack of clarity in creating a truly uniform standard yielded the following revision:[24]

Rule 37. Failure to Make Disclosures or to Cooperate in Discovery; Sanctions

*****

(e) Failure to Preserve Provide Electronically Stored Information. If a party failed to preserve electronically stored information that should have been preserved in the anticipation or conduct of litigation, the court may:

(1) Order measures no greater than necessary to cure the loss of information, including permitting additional discovery; requiring the party to produce information that would otherwise not be reasonably accessible; and ordering the party to pay the reasonable expenses caused by the loss, including attorney’s fees.

(2) Upon a finding of prejudice to another party from loss of the information, order measures no greater than necessary to cure the prejudice.

(3) Only upon a finding that the party acted with the intent to deprive another party of the information’s use in the litigation:

(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.

(4) In applying Rule 37(e), the court should consider all relevant factors, including:

(A) the extent to which the party was on notice that litigation was likely and that the information would be relevant;

(B) the reasonableness of the party’s efforts to preserve the information;

(C) the proportionality of the preservation efforts to any anticipated or ongoing litigation; and

(D) whether, after commencement of the action, the party timely sought the court’s guidance on any unresolved disputes about preserving discoverable information.[25]

 

This total rewrite of Rule 37(e) narrows the scope of its application to ESI.[26] Throughout the drafting process, “it became apparent that the range of cases in federal court is too broad and too diverse” to create “specific rule provisions on when the duty to preserve arises, its scope and duration in advance of litigation, and the sanctions or other measures a court can take when information is lost.”[27] Instead, this version authorizes the court to act in three situations: 1) when failure to preserve has occurred without a showing of prejudice, 2) when failure to preserve has occurred with a showing of prejudice, and 3) when a party acted with the intent to deprive the other party of information to be used in litigation.[28] The amendment also provides illustrative factors for the court to consider in analyzing a claim for spoliation of ESI, which “may help potential litigants make reasonable preservation decisions.”[29]

The current proposal provides far more guidance to courts faced with spoliation of evidence claims.[30] In fact, “[a] central objective of the proposed new Rule 37(e) is to replace the disparate treatment of preservation/sanctions issues in different circuits by adopting a single standard.”[31] It has been recognized that “the preservation of ESI is a major issue confronting parties and courts; and the loss of ESI has produced a bewildering array of court cases,” in addition to “a significant split in the circuits.”[32] Thus, by considering these revisions to Rule 37(e), the current circuit split on evidentiary spoliation could be resolved in favor of a uniform standard.[33]

IV. Conclusion

In consideration of the disparate treatment of spoliation charges such as those spurred by the BP oil spill, proposed Rule 37(e) should be adopted because it aims to “provide general guidance for parties contemplating their preservation obligations,” which is exactly what the parties in the BP litigation were lacking.[34] If adopted, these streamlined considerations would enable employers to effectively educate their employees and prevent unnecessary litigation that could easily be avoided.

 

Preferred citation: Brooksie Bonvillain, Spoliation on the High Seas: Call for Uniform Treatment in Spoliation of Evidence Claims, LSU J. Energy L. & Res. Currents (March 26, 2014), https://jelr.law.lsu.edu/?p=906.


[1] See BP Oil spill timeline. The Guardian (July 22, 2010, 5:25 PM), http://www.theguardian.com/environment/2010/jun/29/bp-oil-spill-timeline-deepwater-horizon, for a general timeline of events transpiring from the BP oil spill.

[2] See In re Oil Spill by Oil Rig Deepwater Horizon in Gulf of Mexico, on April 20, 2010, 910 F. Supp.2d 891 (E.D. La. Dec. 21, 2012), for more on non-governmental claims, which resulted in a class-action settlement for economic loss and property damage after consolidation with multidistrict litigation. See also In re DEEPWATER HORIZON—Appeals of the Economic and Property Damage Class Action Settlement (No. 13-300095) 739 F.3d 790 (5th Cir. 2014) for final approval of proposed class-action settlement. In addition to the various private party claimants, the Obama administration filed suit against BP and other parties alleging violations of safety regulations, seeking fines and penalties under the Clean Water Act and Oil Pollution Act, and claiming recovery of cleanup related costs. United States of America v. BP Exploration & Production Inc. et al, Civ. Action No. 2:10-cv-04536; Suzanne Goldenberg, United States sues BP over Gulf oil disaster, The Guardian (Dec. 15, 2010) (amended Dec. 16, 2010, http://www.theguardian.com/business/2010/dec/16/united-states-sues-bp-gulf-oil?INTCMP=SRCH&guni=Article:in%20body%20link. BP also agreed to plead guilty to criminal charges and pay $4 billion in fines. Clifford Krauss, Judge Accepts BP’s $4 Billion Criminal Settlement Over Gulf Oil Spill, NY Times (Jan. 29, 2013), http://www.nytimes.com/2013/01/30/business/judge-approves-bp-criminal-settlement.html?_r=0.

[3] Michael Kunzelman, Anthony Badalamenti, Former Halliburton Manager, Gets Probation For Destroying Gulf Spill Evidence, The Huffington Post (Jan. 21, 2014), http://www.huffingtonpost.com/2014/01/21/anthony-badalamenti-halliburton-probation_n_4638121.html. In addition to the legal proceedings against Badalamenti, which is the focus of this Article, “[f]our current or former BP employees also have been charged in federal court with spill-related crimes.” See id.

[4] 101 A.L.R. 5th 61. Negligent Spoliation of Evidence, Interfering with Prospective Civil Action, as Actionable.

[5] Robert L. Tucker, The Flexible Doctrine Of Spoliation Of Evidence; Cause Of Action, DefenseEvidentiary Presumption And Discovery Sanction, From the Selected Works of Robert L. Tucker, University of Akron School of Law (1995). Available at: http://works.bepress.com/robert_1_tucker/2.

[6] 101 A.L.R. 5th 61. Negligent Spoliation of Evidence, Interfering with Prospective Civil Action, as Actionable.

[7] American Law Reports ALR 4th, Intentional spoliation of evidence, interfering with prospective civil action, as actionable (emphasis added).

[8] Michael Kunzelman, Anthony Badalamenti, Former Halliburton Manager, Gets Probation For Destroying Gulf Spill Evidence, The Huffington Post (Jan. 21, 2014), http://www.huffingtonpost.com/2014/01/21/anthony-badalamenti-halliburton-probation_n_4638121.html. USA v. Badalamenti, 2:13-CR-00204-JCZ-SS (E.D. La. 2014).

[9] Judge to sentence Halliburton manager in oil spill, Daily Report AM (Jan. 21, 2014), http://businessreport.com/apps/pbcs.dll/section?category=daily-reportAM&date=20140121&utm_source=Louisiana+Business+Inc.&utm_campaign=a0ddb8acfe-Daily_Report_AM&utm_medium=email&utm_term=0_6575324e37-a0ddb8acfe-325234853#How_Americas_fracking. “The data could have supported BP’s decision to use six centralizers instead of 21 on the Macondo project, but prosecutors said the number of centralizers had little effect on the outcome of the simulations.” Michael Kunzelman, Anthony Badalamenti, Former Halliburton Manager, Gets Probation For Destroying Gulf Spill Evidence, The Huffington Post (Jan. 21, 2014), http://www.huffingtonpost.com/2014/01/21/anthony-badalamenti-halliburton-probation_n_4638121.html.

[10] Judge to sentence Halliburton manager in oil spill, Daily Report AM (Jan. 21, 2014), http://businessreport.com/apps/pbcs.dll/section?category=daily-reportAM&date=20140121&utm_source=Louisiana+Business+Inc.&utm_campaign=a0ddb8acfe-Daily_Report_AM&utm_medium=email&utm_term=0_6575324e37-a0ddb8acfe-325234853#How_Americas_fracking. USA v. Badalamenti, 2:13-CR-00204-JCZ-SS (E.D. La. 2014). The United States brought misdemeanor charges for destruction of evidence connected to computers under 18 U.S.C. 18:1030(a)(5)(A), (c)(4)(G)(i) against Badalamenti. Id.

[11] Michael Kunzelman, Anthony Badalamenti, Former Halliburton Manager, Gets Probation For Destroying Gulf Spill Evidence, The Huffington Post (Jan. 21, 2014), http://www.huffingtonpost.com/2014/01/21/anthony-badalamenti-halliburton-probation_n_4638121.html.

[12] Judge to sentence Halliburton manager in oil spill, Daily Report AM (Jan. 21, 2014), http://businessreport.com/apps/pbcs.dll/section?category=daily-reportAM&date=20140121&utm_source=Louisiana+Business+Inc.&utm_campaign=a0ddb8acfe-Daily_Report_AM&utm_medium=email&utm_term=0_6575324e37-a0ddb8acfe-325234853#How_Americas_fracking.. See 18 U.S.C. 18:1030(a)(5)(A), (c)(4)(G)(i) for relevant sentencing guidelines. 18 U.S.C. 18:1030(a)(5)(A), (c)(4)(G)(i).

[13] Michael Kunzelman, Anthony Badalamenti, Former Halliburton Manager, Gets Probation For Destroying Gulf Spill Evidence, The Huffington Post (Jan. 21, 2014), http://www.huffingtonpost.com/2014/01/21/anthony-badalamenti-halliburton-probation_n_4638121.html. Relatedly, Halliburton “pleaded guilty . . . to a misdemeanor charge related to Badalamenti’s conduct,” which cost the company a $200,000 fine and a $55 million contribution to the National Fish and Wildlife Foundation.” Id.

[14] Id.

[15] Id. BP drilling engineer Kurt Mix’s sentencing is set for March 26. Id.

[16] Id.

[17] Summary of the Report of the Judicial Conference Committee on Rules of Practice and Procedure at 10–11, http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Reports/ST03-2013.pdf. This proposal emerged from the Advisory Committee’s May 2010 Conference on Civil Litigation, just a month after the BP oil spill. Id. at 10. “[A] subcommittee formed after the 2010 Duke Conference is continuing to implement and oversee further work on ideas resulting from that conference,” known as the “Duke Rules” Package. Id. at 10; Preliminary Draft of Proposed Amendments to the Federal Rules of Bankruptcy and Civil Procedure, Request for Comment, Committee on Rules of Practice and Procedure of the Judicial Conference of the United States (Aug. 2013) at 260, http://www.uscourts.gov/uscourts/rules/preliminary-draft-proposed-amendments.pdf.

[18] Fed. R. Civ. Pro. 37(e). “Present Rule 37(e) was adopted in 2006.” Advisory Committee on Civil Rules Agenda (Apr. 10-11, 2014) at 383–384, http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Agenda%20Books/Civil/CV2014-04.pdf.

[19] Tom Allman & Mary Mack, Changes to the FRCP at Final Stages Webinar, (Mar. 25, 2014); Fed. R. Civ. Pro. 37(e).

[20] Summary of the Report of the Judicial Conference Committee on Rules of Practice and Procedure at 10–11,  http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Reports/ST03-2013.pdf.

[21] Preliminary Draft of Proposed Amendments to the Federal Rules of Bankruptcy and Civil Procedure, Request for Comment, Committee on Rules of Practice and Procedure of the Judicial Conference of the United States (Aug. 2013) at 314–317, http://www.uscourts.gov/uscourts/rules/preliminary-draft-proposed-amendments.pdf.

[22] Id. at 260.

[23] Tom Allman & Mary Mack, Changes to the FRCP at Final Stages Webinar, (Mar. 25, 2014).

[24] Id. (“Two goals have inspired this work. One has been to establish greater uniformity in the ways in which federal courts respond to a loss of ESI. . . . The other goal has been to relieve the pressures that have led many potential litigants to engage in what they describe as massive and costly over-preservation . . . in anticipation of litigation, including litigation that is never brought.” Advisory Committee on Civil Rules Agenda (Apr. 10-11, 2014) at 369–370, http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Agenda%20Books/Civil/CV2014-04.pdf.)

[25] Advisory Committee on Civil Rules Agenda (Apr. 10-11, 2014) at 383–384, http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Agenda%20Books/Civil/CV2014-04.pdf.

 

[26] Advisory Committee on Civil Rules Agenda (Apr. 10-11, 2014) at 372, http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Agenda%20Books/Civil/CV2014-04.pdf. The scope of the rewrite is consistent with current Rule 37(e). Id.

[27] Id. at 370.

[28] Tom Allman & Mary Mack, Changes to the FRCP at Final Stages Webinar, (Mar. 25, 2014). See proposed Rule 37(e)(1)-(3) at Advisory Committee on Civil Rules Agenda (Apr. 10-11, 2014) at 383–384, http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Agenda%20Books/Civil/CV2014-04.pdf.

[29] Advisory Committee on Civil Rules Agenda (Apr. 10-11, 2014) at 373, http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Agenda%20Books/Civil/CV2014-04.pdfSee proposed Rule 37(e)(4) at Advisory Committee on Civil Rules Agenda (Apr. 10-11, 2014) at 383–384, http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Agenda%20Books/Civil/CV2014-04.pdf.

[30] Tom Allman & Mary Mack, Changes to the FRCP at Final Stages Webinar, (Mar. 25, 2014).  There are still issues, such as the interplay between the factors to be considered when sanctioning a party and the role of prejudice, within the revised draft to be addressed before any version of Rule 37(e) would be formally adopted. Id. From here, the Rule 37(e) proposal will go to Standing Committee in May 2014, Judicial Conference, then Congress under its powers granted in the Rules Enabling Act. Id. The earliest date this proposal would be effective is December 2015. Id.

[31] Preliminary Draft of Proposed Amendments to the Federal Rules of Bankruptcy and Civil Procedure, Request for Comment, Committee on Rules of Practice and Procedure of the Judicial Conference of the United States (Aug. 2013) at 272, http://www.uscourts.gov/uscourts/rules/preliminary-draft-proposed-amendments.pdf.

[32] Advisory Committee on Civil Rules Agenda (Apr. 10-11, 2014) at 371, http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Agenda%20Books/Civil/CV2014-04.pdf.

[33] Preliminary Draft of Proposed Amendments to the Federal Rules of Bankruptcy and Civil Procedure, Request for Comment, Committee on Rules of Practice and Procedure of the Judicial Conference of the United States (Aug. 2013) at 273, http://www.uscourts.gov/uscourts/rules/preliminary-draft-proposed-amendments.pdf.

[34] Id. at 275. The public comment period for Rule 37(e) closed in February 2014. Proposed Amendments Published for Public Comment,  http://www.uscourts.gov/RulesAndPolicies/rules/proposed-amendments.aspx.

Categories: Uncategorized

amorg44

Law Student




Provide Website Feedback / Accessibility Statement / Privacy Statement