U.S. Legal Holds Across Borders: A Legal Conundrum?

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Volume 13, Issue 1 (Jun 2012)

U.S. legal holds present a conundrum that confronts the bar and bench with increasing frequency. It is the result of a clash between broad U.S. preservation obligations mandated by existing case law and stringent privacy and data protection laws in other jurisdictions, including European Union (“E.U.”) member states.  The challenge requires a multinational litigant to decide in which country she would prefer to have sanctions imposed and for what reason: failing to prevent the deletion of data when litigation is “reasonably anticipated,” or illegally preserving it under these same circumstances. Retention of “personal data,” which includes electronic mail, constitutes “processing” in the E.U. and elsewhere, and may only be performed for a purpose permitted by regional directives and local laws. However, U.S. litigation may not be a valid reason to preserve personal data under these provisions. In addition, many nations within and beyond the E.U. prohibit the retention of personal data after the reason for its initial collection has been accomplished. A U.S. legal hold may, therefore, violate these laws and expose the multinational litigant to significant civil penalties in jurisdictions where the data may be located.

This article analyzes and discusses these conflicts in the context of the acceleration of global commerce and resulting litigation. It highlights key issues in the dispute between U.S. discovery and non-U.S. legal systems that pose data preservation obstacles for litigants and courts and suggests means to reduce the risks of implementing legal holds beyond the United States.

Kenneth N. Rashbaum, Matthew Knouff & Melinda C. Albert, U.S. Legal Holds Across Borders: A Legal Conundrum?, 13 N.C. J.L. & Tech. 69 (2011), available at http://ncjolt.org/wp-content/uploads/2016/09/06_13NCJLTech692011-2012.pdf.

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