Why It is Crucial to Have a Litigation Response Plan

When does the destruction of email messages of a named plaintiff by the defendant’s IT department lead to sanctions? Apparently not in the matter of Auffarth v. Herald Natl. Bank (Supreme Court of New York, New York County), where the court found that actions undertaken by the defendant that led to the destruction of Auffarth’s emails were not willful and did not meet the definition of gross negligence.

Auffarth v. Herald National Bank

Henry Auffarth and 28 other employees were terminated by Herald National Bank on February 12, 2010. The bank claimed that the employees were terminated for cause, which was based on their alleged failure to perform.

Properly preserving of data is crucial to avoid spoliation potential sanctions – watch this on-demand webinar to learn how to make it a reasonable business practice at a reasonable cost.

Plaintiffs filed claim on March 29, 2010, for alleged breach of their employment contracts. This opinion dealt specifically with Henry Auffarth, whose employment with the bank began on March 2, 2009. 

Proactively Preserving Evidence in Anticipation of Litigation

On the same day of the mass termination, the bank’s Chief Information Officer, emailed an employee of Rackspace, the company who was hosting the bank’s emails. The email requested that Rackspace preserve “to DVD or CD the e-mails of a number of individuals who had been terminated that day.” The list of email boxes to preserve was listed in the message and was in alphabetical order by last name and started with Jerry Barber. The list did not include Mr. Auffarth. Two weeks later the CIO requested that that Rackspace remove the email boxes from the bank’s account. As a result, Mr. Auffarth’s emails were not preserved.

At his deposition, the CIO stated that he received the list of terminated employees by email from the Human Resources department. He then testified he cut and pasted the names and forwarded that email to Rackspace. However, he made the mistake of leaving Mr. Auffarth’s name off the list.

Attempts to Recover the Deleted Emails

Ok, so the email was deleted from the server, but how about getting the messages from Mr. Auffarth?

To complicate matters further, Mr. Auffarth passed away on August 22, 2011. After his passing, Mr. Auffarth’s administrative assistant stated that he had a laptop that was used to send and receive emails during his time at the bank. The messages contained on the laptop may have been duplicative of the ones destroyed by the bank.

Auffarth also had a Blackberry that was used during his time at the bank and also contained messages.

“The estate retained a Blackberry issued by the bank to Mr. Auffarth. The password for the device is not known to the parties. While the spoliation motion was sub judice the Court directed defendant to retain a forensic expert to recover the password. Defendant’s experts were unsuccessful in their attempts to retrieve the e-mails stored on the Blackberry.” 

It was not mentioned in the opinion whether or not Defendant’s computer forensics expert was able to recover messages from the laptop. Was this attempted? I think this is a significant point as it may have resolved the issue. 

Findings of the Court

So what did the court decide? The court found that “[t]he destruction of Mr. Auffarth’s e-mails does not support a finding of gross negligence.” Gross negligence is “conduct that evinces a reckless disregard of the rights of others or smacks of intentional wrongdoing”.

It is lesson to all parties involved in discovery; having a plan, following it, documenting it and taking proactive measures goes a long way if a mistake happens to occur.

The court clearly outlined the reason for its decision:

“First, there is no evidence that the e-mails were intentionally or willfully destroyed. Second, the bank attempted to preserve the e-mails of all terminated employees, including Mr. Auffarth. His name was left off the list based on an error made by Mr. Schiralli (CIO) in failing to copy and paste all of the names properly. Mr. Schiralli’s mistake was inadvertent and establishes that he was negligent by failing to take reasonable care after being instructed to preserve the e-mails of all employees terminated on February 12, 2010.”

In my opinion, the court’s decision was heavily influenced by the proactive measures taken by the bank after the mass termination. Their litigation readiness plan included the HR department taking immediate action to have the emails preserved and communications between the bank and its counsel shortly after the event. 

Proving Relevancy of Deleted Emails is Important

It is not just about the deletion. The plaintiff also needed to show that the deleted messages may have assisted with proving their case. The plaintiff was not able to show how the emails may have been relevant or assist with “establishing that the bank acted in bad faith or engaged in fraud or arbitrary action in terminating Mr. Auffarth for his alleged failure to perform.”

Additionally, the court noted that the plaintiff “received all e-mails from custodians at the bank that were sent by Plaintiff or mentioned Mr. Auffarth by name. The estate has not drawn to the Court’s attention evidence from this category of e-mails that is relevant to whether or not the termination was for cause.”

The court went on to state that granting the plaintiff’s motion by an order of preclusion or adverse inference based solely on the fact that the bank failed to preserve emails was “tantamount to finding that Mr. Auffarth was discharged for cause. The bank’s conduct in destroying the e-mails does not call for such a drastic remedy, especially where there is no showing that the e-mails are crucial to the estate’s case.”


I think this decision was the right one given the facts and circumstances surrounding the destruction of email. It is lesson to all parties involved in discovery; having a plan, following it, documenting it and taking proactive measures goes a long way if a mistake happens to occur. Perfection is not the standard and the court here has found just that. 

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