Failure to Preserve Marketing Videos

Failure to Preserve Marketing Videos Leads to Adverse Inference Sanctions: eDiscovery Case Law

In Sony Music Entm’t v. Vital Pharm., Inc., No. 1:21-cv-22825-WPD/Becerra (S.D. Fla. Sept. 13, 2022), Florida Magistrate Judge Jacqueline Becerra granted plaintiffs’ motion for sanctions in part, ordering adverse inference sanctions for failure to preserve marketing videos and marketing engagement data for other videos, as well as attorneys’ fees and costs associated with the motion.

Case Discussion

In this case involving copyright infringement claims over defendants’ marketing videos that plaintiffs claimed included their copyrighted music, Judge Becerra stated: “There is no dispute that some of the videos at issue were not preserved at all, and there is no dispute that many of the videos that were produced were not preserved with the engagement data (i.e., how many views, how many ‘likes’) that defendants should have preserved.”

The discovery cutoff in this case was May 12, 2022. After each of three hearings on May 3, May 10 and May 12, the Court ordered defendants to produce the responsive videos, but the defendants failed to produce them each time. Following another discovery hearing, this Court issued an order on May 26, 2022, permitting plaintiffs to file a motion for sanctions regarding defendants’ repeated failure to preserve marketing videos. Due to the Court’s Discovery Procedures, plaintiffs were not permitted to file a written motion on the issue without leave of court.

In the motion filed, plaintiffs asserted that the spoliation was in bad faith, that Plaintiffs were severely prejudiced by the failure to preserve marketing videos, and that sanctions are warranted. They proposed the following sanctions: (1) the imposition of “an adverse inference that for each video identified by Plaintiffs that cannot now be located because that video was not properly preserved, the video is deemed to have embodied the copyrighted sound recording as alleged”; (2) the imposition of an adverse inference that “the videos that were not preserved were viewed as many times and had as much social media engagement and reach as the most popular videos posted by Defendants or their influencers on social media”; and (3) an award of attorneys’ fees.

In response, defendants produced screenshots of some of the missing videos and claimed that production negated most if not all prejudice caused by the failure to produce videos. They also asserted that there was no bad faith conduct in the spoliation of evidence because the failure to preserve was inadvertent and proposed lesser sanctions if the Court deemed sanctions were appropriate.

On August 16, 2022, plaintiffs filed a Notice of Supplemental Authority, which alerted the Court to an order entered on August 11, 2022, by Magistrate Judge Patrick Hunt in UMG Recordings, Inc. v. Vital Pharmaceuticals, Inc. d/b/a Bang Energy, a case brought against the same defendants that posed virtually the exact issues here (“Universal Matter”). There, the Court awarded sanctions against defendants for their failure to preserve marketing videos, the same kind of videos at issue here. There were two sets of videos at issue: 1) 22 unproduced videos and 2) 171 videos that were eventually produced, but without engagement data (“data-free videos”).

Judge’s Ruling

Regarding the unproduced videos, Judge Becerra stated: “the undersigned finds that Defendants’ conduct here was in bad faith, as defined. Defendants were well-aware of their duty to retain the videos, having been asked to do so as early as April 13, 2021…It is unclear why Defendants were unable to produce these twenty-two videos prior to the discovery cutoff, yet somehow were able to produce videos and/or corresponding screenshots of them afterwards…Defendants’ subsequent production occurred so late as to eventually deprive Plaintiffs of a meaningful opportunity to include the videos in this case. Such actions deprived Plaintiffs of crucial evidence to which they were entitled and caused them prejudice, as they cannot adequately address them in this case—which they are clearly entitled to do.” She also found the failure to produce the engagement data for the 171 videos was in bad faith, finding the plaintiffs were prejudiced in the same manner.

Finding the circumstances essentially identical to the Universal Matter referenced above, Judge Becerra granted plaintiffs’ motion for sanctions in part, stating: “For each of the Unproduced Videos, Plaintiffs shall receive a rebuttable presumption that, should song ownership be proven, Plaintiffs have also established the second element of a copyright infringement claim, copying (both legal and factual) of constituent elements of the work that are original. For each of the Data-Free Videos, Plaintiffs shall receive a rebuttable presumption that the videos had the same reach as a comparable post by the account on which the video was posted. Finally, Plaintiffs are awarded attorneys’ fees and costs associated with the instant Motion.”

So, what do you think? Was that an appropriate sanction for failure to preserve marketing videos that were at the heart of the case? Please share any comments you might have or if you’d like to know more about a particular topic.

Case opinion link courtesy of eDiscovery Assistant, an Affinity partner of eDiscovery Today.

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