Enforcing Litigation Holds to Avoid Sanctions | Practical Law

Enforcing Litigation Holds to Avoid Sanctions | Practical Law

The way a company implements and enforces a litigation hold is an important factor courts look to when assessing whether document preservation efforts complied with legal requirements designed to prevent the destruction of relevant evidence. Proper hold enforcement includes notifying all possible custodians of the legal hold's scope and escalating the hold notice to managers of non-compliant employees. An effective legal hold process incorporates well-timed and regular reminders as well as lift notices.

Enforcing Litigation Holds to Avoid Sanctions

Practical Law Legal Update 8-547-3245 (Approx. 3 pages)

Enforcing Litigation Holds to Avoid Sanctions

by Practical Law Litigation
Law stated as of 30 Oct 2013 • USA (National/Federal)
The way a company implements and enforces a litigation hold is an important factor courts look to when assessing whether document preservation efforts complied with legal requirements designed to prevent the destruction of relevant evidence. Proper hold enforcement includes notifying all possible custodians of the legal hold's scope and escalating the hold notice to managers of non-compliant employees. An effective legal hold process incorporates well-timed and regular reminders as well as lift notices.
The way a company implements and enforces a litigation hold is a significant factor courts look to when assessing whether document preservation efforts complied with legal requirements designed to prevent the destruction of relevant evidence. Proper hold enforcement includes notifying all possible custodians of the legal hold's scope and escalating the hold notice to managers of non-compliant employees. An effective legal hold process incorporates regular reminders as well as a well-timed lift notice.
Due to the many recent examples of companies sanctioned for failing to properly conduct their litigation hold procedures, legal departments are auditing their hold methodologies to see how they can improve them and make them more likely to withstand court scrutiny. This type of holistic process auditing usually involves several departments and numerous steps, including:
  • Defining the various scenarios the legal department should consider as triggers for issuing a legal hold.
  • Analyzing how legal holds are typically distributed among employees and former employees.
  • Assessing how frequently reminders are sent out.
  • Comparing the response rate for custodians versus non-custodians.
  • Establishing escalation procedures for managers of employees who have not complied with any part of a hold.
  • Determining which parts of the hold lifecycle can be automated with software that streamlines the process.
Corporate counsel and law firm attorneys with sizable litigation portfolios can use the metrics collected from analyzing recent hold results to implement future holds more quickly and cost-effectively. The use of templates that can be easily customized according to each new trigger also helps counsel issue a hold more efficiently, avoiding the possibility of distributing a late hold.
For resources that help counsel develop and improve a company's legal hold process, including standard language for a preservation demand letter and an escalation notice, see the Litigation Hold Toolkit.