One of the fastest developing and most troubling areas of litigation is “spoliation,” the failure to preserve necessary evidence.

While state laws on the topic vary, they all generally require that, once litigation is anticipated, evidence that is reasonably relevant to the matter must be preserved and unaltered.

Depending on the nature and location of the court action, the failure to properly preserve such evidence can result in unexpected and even severe penalties.

The types of evidence subject to preservation requirements are as varied as the possibilities for lawsuits. The party in possession of evidence must consider not only what might prove a case or disprove an opponent’s case, but also what might assist the opponent.

Missing evidence could have impact

It is usually evidence in this latter category that leads to spoliation litigation.

For example, an employee who alleges harassment by a supervisor may claim that missing emails would have supported his allegation.

Or, a company that alleges a departing employee took customer lists and trade secrets to a competitor may allege that missing day planners, calendars and similar records would have backed up its allegations.

Generally, the duty to preserve evidence is created when the existence or potential of a lawsuit is known or reasonably should be known.

Sometimes that is obvious, such as when a disgruntled user of a product tells the manufacturer or retailer, “I’m going to sue you.”

Most times, however, the occurrence is more subtle.

Proactive approach to saving evidence

Many companies are now taking a proactive approach to preserve evidence. Some issue retention policies that address the nature of evidence, including electronic records, that must be maintained.

Such policies often include a statement as to what must be retained, who is in control of the maintained items and how long they must be preserved. While many companies react as new threats of litigation occur, more companies now are establishing litigation-hold policies.

Within those, a company can map out a generic plan to preserve evidence and then apply it to each instance of potential litigation based on the specific circumstances.

Potential for dire consequences

 In most jurisdictions, decisions as to whether evidence should have been preserved and what penalty could be imposed for its spoliation belong to the judge. If the judge believes it is likely that evidence has been spoliated, he or she may instruct the jury to presume that the lost evidence supports the opponent’s case.

If the judge believes that the failure to preserve evidence was intentional, he or she may preclude that party from presenting evidence in support of its defense or may even go as far as granting judgment to the other side.

Additionally, the court can award damages, monetary sanctions and attorney fees.

In some states, including Ohio, the failure to properly preserve evidence may, in and of itself, be the basis for a separate lawsuit.

That is, even if a plaintiff may not be able to prove an alleged product defect, employment discrimination or unfair competition, he or she may still be able to obtain a judgment simply upon the implication that evidence that likely could have proven one of those claims was improperly spoliated.

In good and bad economic times, it is difficult to spend time and money on matters that do not directly help the bottom line. However, proper planning for preservation of evidence is a modern example of the age-old adage that “an ounce of prevention is worth a pound of cure.”

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John T. Dellick is a litigation lawyer with Harrington, Hoppe & Mitchell, Ltd. He can be reached at jdellick@hhmlaw.com or at (330) 744-1111.