Representatives of Prince’s Estate filed suit against George Ian Boxill, a sound engineer who took tracks of certain songs and released them with the assistance of Rogue Music Alliance (RMA), an LLC whose principals are David Staley and Gabriel Solomon Wilson. Despite acknowledging the risk of litigation, defendants failed to preserve, and indeed destroyed, text messages to and from Staley and Wilson.  Before releasing the music, Staley had sent an e-mail indicating that Boxill had indemnified RMA in the event the Prince Estate chose to challenge the release of the songs.  On motion for sanctions, the District Court found that the duty to preserve existed at that time, if not before.

“There is no doubt that Staley and Wilson are the types of persons likely to have relevant information, given their status as principals of RMA and owners of Deliverance. Nor can there be any reasonable dispute as to the fact that their text messages were likely to contain information relevant to this litigation. In fact, Boxill and other third parties produced text messages that they sent to or received from Staley and Wilson. Neither party disputes that those text messages were relevant to this litigation. Thus, the RMA Defendants were required to take reasonable steps to preserve Staley and Wilson’s text messages. The RMA Defendants did not do so. First, Staley and Wilson did not suspend the auto-erase function on their phones. Nor did they put in place a litigation hold to ensure that they preserved text messages. The principles of the standard reasonableness framework require a party to suspend its routine document retention/destruction policy and put in place a ‘litigation hold’ to ensure the preservation of relevant documents. It takes, at most, only a few minutes to disengage the auto-delete function on a cell phone. It is apparent, based on Staley’s affidavit, that he and Wilson could have taken advantage of relatively simple options to ensure that their text messages were backed up to cloud storage. These processes would have cost the RMA Defendants little, particularly in comparison to the importance of the issues at stake and the amount in controversy here. Failure to follow the simple steps detailed above alone is sufficient to show that Defendants acted unreasonably. But that is not all the RMA Defendants did and did not do. Most troubling of all, they wiped and destroyed their phones after Deliverance and RMA had been sued, and, in the second instance for Wilson, after the Court ordered the parties to preserve all relevant electronic information, after the parties had entered into an agreement regarding the preservation and production of ESI, and after Plaintiffs had sent Defendants a letter alerting them to the fact they needed to produce their text messages. As Plaintiffs note, had Staley and Wilson not destroyed their phones, it is possible that Plaintiffs might have been able to recover the missing text messages by use of the ‘cloud’ function or through consultation with a software expert. But the content will never be known because of Staley and Wilson’s intentional acts. The RMA Defendants’ failure to even consider whether Staley and Wilson’s phones might have discoverable information before destroying them was completely unreasonable. This is even more egregious because litigation had already commenced.”

The Court found that, “given the facts of this case, the conduct of the RMA Defendants is egregious – they willfully and intentionally destroyed discoverable information. Thus, monetary sanctions are available.”  The Court then ordered the RMA Defendants to pay reasonable expenses, including attorney’s fees and costs, that Plaintiffs incurred as a result of the RMA Defendants’ misconduct. “In addition, pursuant to Rule 37(e)(2) and the Court’s pretrial scheduling order, the Court will also order the RMA Defendants to pay into the Court a fine of $10,000.”

 

Paisley Park Enterprises v. Boxill, 330 F.R.D. 226 (D.Minn. 2019).