An amendment to the Federal Rules of Civil Procedure does not move North Carolina to change

An amendment to rule 37(e) of the Federal Rules of Civil Procedure (FRCP) in 2015 has had a significant impact on litigation as of late. There has been a 35% decrease in sanctions resulting from E-discovery spoliation of electronically stored information (ESI) post the amendment. FRCP 37(e) applies to the “failure to preserve stored information.” The rule guides the court on dealing with issues of spoliation. Spoliation is defined as “destruction or significant alteration of evidence, or the failure to preserve property for another’s use as evidence in pending or reasonably foreseeable litigation.” The 2006 rule was considered to leave issues regarding e-discovery unresolved.

To avoid sanctions some courts have required the information to be missing information to be a result of a routine process or automated system. Also, while the “good-faith” provision provided some protection to litigants, it placed the responsibility on parties to affirmatively protect the information it anticipated would be relevant to litigation. Fearing the possibility of sanctions, companies found processes and programs to comply with this rule to be costly and confusing.  The amendment provided clarification and guidance to the court when ruling on spoliation issues. It allowed the court to analyze intent, and sanction accordingly. The new version specified measures a court can take if ESI that should have been preserved is purposefully irretrievable. It is not only a lot clearer, but more forgiving. Furthermore, it allows litigants to operate without the increased fear of liability and risk of sanctions from circuit courts with differing approaches to the rule.

Although the FRCP 37 has been amended, some states have yet to make any changes that add any additional clarity to their state rules of civil procedure. North Carolina has not amended its version of rule 37 since 2011, before the FCRP’s latest amendment of rule 37. The North Carolina Rules of Civil Procedure 37(b1) deals with the failure to provide “electronically stored information”. It closely resembles the FCRP 2006 version of the rule, it states “[a]bsent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of routine, good-faith operation of an electronic information system.” The ambiguity and lack of guidance from this rule are why the federal rules were amended. North Carolina has not changed it but the state’s and the same needs to be done with North Carolina’s rule.

The Chief Justice’s guidelines that accompanies the General Assembly’s rules goes further than the face of the rule, laying out when the court should issue sanctions. It instructs that a court should impose sanctions in violation of rule if there was a legal obligation to preserve the information when it was destroyed, the destruction of the material was not the result of the routine, good-faith operation of a system, and the destroyed information was subject to production under the applicable state standard for discovery. Although North Carolina did not follow the FRCP in amending the state’s version of the rule, these guidelines fill the gaps created by the rule. Litigants in North Carolina can rely on the guidelines of the Chief Justice and prior state court sanction rulings to provide the clarity received by the FRCP 2015 amendment.

Donte Jones

October 9, 2019