In Safelite Grp., Inc. v. Lockridge, No. 2:21-cv-4558 (S.D. Ohio Sept. 30, 2024), Ohio District Judge Sarah D. Morrison found negligence in failing to preserve text messages by the defendant, ruling that “a sanction under Rule 37(e)(1) is appropriate” and that “A permissive adverse-inference instruction is no greater than necessary to cure the prejudice.”

Case Discussion and Judge’s Ruling

In this case involving claims that the defendant used proprietary information to recruit employees and customers to his new employer once he left the plaintiff’s employment, the defendant sent an email to the recruiter at his new employer (Caliber Collision Centers) ten days after he started working there, identifying “techs that I have worked with and all would make a great addition to the team”. The plaintiff caught wind of the defendant’s activities and believed that his new employment and recruiting activities violated the defendant’s contractual obligations to the plaintiff.

The day after the defendant’s email to the recruiter (August 27, 2021), the plaintiff sent the defendant a cease-and-desist letter, which the defendant forwarded to Caliber within days. Less than a month later (September 13, 2021), the plaintiff filed suit. He notified Caliber, who referred him to counsel. Counsel “advised [the defendant] orally of [his] obligation to retain and not destroy, delete, or throw away any documents, records or communications that dealt with the allegations in the lawsuit.” The defendant received his first written litigation hold from Caliber in November 2021. Then, during a February 3, 2022 conference with his counsel to review discovery responses, the defendant “learned [that his] personal phone was set to auto-delete text messages after 30 days.”

As a result, despite the plaintiff’s request for the defendant to produce all communications between him and “any person or entity that evidence, refer, or in any way related to [his] employment with Caliber”, the defendant admitted that he made no effort to preserve his text messages until February 3, 2022, and that his cell phone was set to delete any text messages older than 30 days. As a result, he did not preserve any text messages sent or received before January 4, 2022. The plaintiff asked the Court to find that Lockridge spoliated evidence, impose an adverse-inference sanction, and award costs and expenses.

In discussing the circumstances, Judge Morrison stated: “Lockridge was put on notice of potential litigation when he received the August 27 Letter…The August 27 letter was detailed and specific, describing Safelite’s concern that Lockridge was, among other things, soliciting employees in violation of his contract…Safelite also demanded that Lockridge cease and desist from any further violations, and closed with explicit reference to ‘a lawsuit seeking monetary damages and injunctive relief.’ Where ‘a letter openly threatens litigation, then the recipient is on notice that litigation is reasonably foreseeable and the duty to preserve evidence relevant to that dispute is triggered.’” Judge Morrison also rejected the defendant’s argument that the letter should not impose a duty on him to preserve evidence “because he is a lay person”, stating that “the proposition runs counter to the objective approach described above.”

Judge Morrison also found that “the lost text messages are relevant to Safelite’s claims…Safelite has proffered evidence that Lockridge was soliciting Safelite employees around the time he received the August 27 Letter. For example, on August 26, Lockridge sent Caliber recruiter Chris Abal a list of five Safelite technicians, saying he had ‘talked to all of them and they know you [the recruiter] will be reaching out to them.’ Texts from August 27 show that Lockridge encouraged Gracia to apply to Caliber through its website. Safelite has also submitted declarations from other technicians who say Lockridge approached them about working for Caliber around this time…Safelite’s evidence casts a pall over Lockridge’s lost texts”.

Judge Morrison also rejected the defendant’s contention that “he did not know his phone automatically deleted text messages after 30 days, and the loss was an honest mistake”, stating: “Lockridge is an experienced businessman—he is now the General Manager for Caliber in Phoenix and he previously served as an operations manager and store manager for Safelite. His plea of ignorance strains credulity. It is not plausible that a modern, professional smartphone user like Lockridge could carry on for four years without realizing that his text messages disappeared after 30 days.” She also called out defendant’s counsel for their oral advise to retain evidence, stating: “That advisement was inadequate. First, ‘an oral litigation hold is insufficient to reasonably protect against the spoliation of evidence.’…Further, ‘[a] litigation hold—whether verbal or written—that fails to instruct a party to disable auto-deletion functions is not much of a litigation hold.’”

Finding that “Lockridge was negligent in failing to preserve the text messages” and that “Safelite was prejudiced by Lockridge’s failure to preserve the text messages”, Judge Morrison stated: “Because the Court finds that Lockridge’s negligent failure to preserve the text messages prejudices Safelite, a sanction under Rule 37(e)(1) is appropriate.” So, she stated: “Pursuant to Rule 37(e)(1), the parties will be permitted to present admissible evidence of Lockridge’s duty to preserve his text messages, and negligent failure to do so, and argument on whatever inference the jury should take from that evidence.” She also awarded attorneys’ fees and costs.

So, what do you think? Do you agree that defendant’s negligence in failing to preserve text messages warranted an adverse inference instruction? Please share any comments you might have or if you’d like to know more about a particular topic.

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