In Pinstripe, Inc. v. Manpower, Inc., et. al., 2009 U.S. Dist. LEXIS 66422 (N.D. Okla. July 28, 2009), U.S. Magistrate Judge Paul J. Cleary sanctioned defendants for failure to preserve relevant e-mails but declined to "punish" defendant's law firm for defendant's spoliation.

Plaintiff filed this action on October 25, 2007 seeking, in part, an injunction barring actions by defendants International Business Machines Corporation and Manpower, Inc. to transition plaintiff's employees to Manpower.  Manpower's law firm drafted a litigation hold and forwarded it to Manpower on October 27, 2007.  However, Manpower failed to issue the litigation hold.  In discovery, the parties realized that Manpower's document production was incomplete.  When plaintiff requested information regarding Manpower's preservation of documents, Manpower conceded that not all e-mails had been produced.  Nearly one year after the commencement of discovery, Manpower issues its first litigation hold.  Subsequently, Manpower learned that its employees may have deleted discoverable e-mails.

The court held that Manpower failed to: (1) meet its obligations to preserve potentially relevant documents; (2) issue the litigation hold drafted by its outside counsel; and (3) monitor compliance with the oral instructions given to some of its managers. Plaintiff sought an adverse inference instruction.  In the 10^th Circuit, a party must demonstrate the destruction was predicated on bad faith.  The court found that Manpower's conduct was not intentional and does not reflect that documents were deliberately destroyed because the company believed its defense was weak or otherwise vulnerable. However, Manpower allowed one employee to destroy documents.  Thereafter, Manpower recovered and produced some e-mails using in-house IT staff and an outside third-party vendor.

The court took Manpower's efforts into consideration and determined that it should, as a spoliation sanction, pay for any depositions necessary to address the late-produced e-mails, including depositions of Manpower's IT representative or vendor.  In addition, the court ordered Manpower to contribute $2,500 to the Tulsa County Bar Association for a seminar on litigation hold orders and preservation of electronic information.  The court declined to sanction outside counsel ruling that counsel under FRCP 26(g) appropriately relied on the representations of its clients.