Commercial Litigation and Arbitration

Spoliation — Destruction of Laptop Leads to Dismissal of Plaintiff’s Complaint and Adverse Inference on Counterclaims

From Kvitka v. Puffin Co., 2009 U.S. Dist. LEXIS 11214 (M.D. Pa. Feb. 13, 2009):

Plaintiff Nancy Kvitka ("Kvitka") and Plaintiff Nikel Enterprises, Inc. ("Nikel") (collectively "Plaintiffs") purchase and sell antique French and German bisque-headed dolls made during the late Nineteenth and early Twentieth Century…. Antique Doll Collector 2 specializes in antique bisque dolls, the only such magazine in the United States…. Kvitka began placing advertisements in Antique Doll Collector in 1998, when the magazine debuted…. According to Plaintiffs, shortly after the United Federation of Doll Clubs annual national convention, Defendants launched a campaign of character assassination "with the goal of harming Plaintiffs' business and forcing Plaintiffs out of Antique Doll Collector." … The alleged campaign, culminated in the termination of "Plaintiffs' right to advertise" in Antique Doll Collector….

Unable to resolve the conflict, Plaintiffs threatened suit, and Defendants responded to the threat with a letter dated August 30, 2005 that informed Plaintiffs' counsel that Puffin Company, LLC ("Puffin"), publisher of Antique Doll Collector, maintained a file with several written complaints from "dealer-advertisers" and "collector-readers" of the magazine as well as fifteen pages of emails written by Kvitka that disparaged other dealers…. Shortly thereafter, Defendants' counsel sent a letter to Plaintiffs' counsel, which reminded Plaintiffs:

In turn, I trust that you will dutifully inform your client, whether or not her previous attorneys at Stark & Stark have already done so, that her computer(s), particularly her computer hard drive(s), and all her accumulated email account message files going back several years must be safeguarded and preserved as potential material evidence. As you know, emails can be deleted, but they cannot be erased.


Sometime later in March 2006 [two months after filing suit in state court], Kvitka threw her old laptop into the trash. On March 16, 2006, during a conference regarding Plaintiffs' request for emails in Defendants possession, the commonwealth trial court judge inquired about the status of the original emails…. Plaintiffs failed to inform the judge that the old laptop had been discarded at the conference or in subsequent written correspondence, and instead opted to discontinue the pending state court litigation…. Plaintiffs, then, filed the instant federal suit on April 25, 2006, yet failed to inform Defendants that Kvitka had disposed of her old laptop and its hard drive until October 27, 2007….

The court must, therefore, determine the appropriate sanctions to impose against Plaintiffs for the intentional destruction of a laptop that contained emails and other electronic data essential to the resolution of the case. "There is no rigid rule mandating a particular sanction upon a finding of improper destruction or loss of evidence." Baliotis, 870 F. Supp. at 1289. Rather, courts may consider a wide range of potential sanctions for spoliation, including (1) dismissal of a claim or granting judgment in favor of a prejudiced party, (2) suppression of evidence, (3) an adverse inference, called the spoliation inference, (4) fines, and (5) attorney's fees and costs. Mosaid Techs., Inc. v. Samsung Elecs. Co., 348 F. Supp. 2d 332, 335 (D.N.J. 2004). Nonetheless, the Court of Appeals has instructed that courts should exercise discretion in imposing sanctions with a view toward choosing "the least onerous sanction corresponding to the willfulness of the destructive act and the prejudice suffered by the victim." Schmid, 13 F.3d at 79. "A sanction that has the drastic result of judgment being entered against the party who has lost or destroyed evidence must be regarded as a last resort, to be imposed only if no alternative remedy by way of a lesser, but equally efficient sanction is available." Baliotis, 870 F. Supp. at 1289 (citation and internal quotation marks omitted).

Defendants seek dismissal of Plaintiffs' claims as well as summary judgment in their favor on their cross-claims or an adverse inference instruction…. [T]he court will dismiss Plaintiffs' claims and permit an adverse inference instruction on Defendants' cross-claims.

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