Spoliation Sanction: Fix First, Sue Later = Non-Starter

Today, the Minnesota Court of Appeals, in a published decision (authored by Judge Stauber), held that, “[I]n order to provide a meaningful opportunity to correct defects, prepare for negotiation or litigation, and safeguard against stale claims…we conclude that a party must provide actual notice of the nature and timing of any action that could lead to destruction of evidence and afford a reasonable amount of time from the date of the notice to inspect and preserve evidence. Such notice was especially critical in this case because the cause of the damage was in dispute, multiple parties were alleged to be responsible, and much of the mold and moisture was concealed within the exterior walls and, therefore, could not be examined without significant damage to the structure.”

In a strong dissent, Judge Klaphake wrote, “The threat of a spoliation sanction encourages an injured party to inform an alleged tortfeasor of a possible claim in order to enable the tortfeasor to defend against such a claim. Respondents were given that opportunity here, and the district court abused its discretion by imposing a spoliation sanction that extinguished appellant’s claim.” (The case might be a candidate for Supreme Court review?)

How long will it take before a party will seek to use this decision in the context of alleged spoliation of electronic data (i.e., emails, word-processing documents, and so on)? Hopefully any such attempted expansion would be looked at with considerable scrutiny because of the critical difference between the destruction of physical evidence at the core of a legal dispute and discarding documentary evidence (which is done in the ordinary course, by all people and businesses, every day).