A large part of running a business is dealing with records. If a business disposes of records that may serve as evidence in a legal matter they can be found responsible for spoliation. Spoliation is defined as the destruction of or failure to retain evidence. It can be hard to determine which records must be preserved and which can be disposed of. With a new ruling by the Texas Supreme Court, the task may become slightly more bearable.
In 2004, former professional football player Jerry Aldridge fell in a grocery store after slipping on grease that was on the floor. He filed a personal injury suit against the grocery store which was owned by Brookside Brothers. A surveillance camera recorded Aldridge walking into the store and falling. When his attorney asked for more footage than that showing the fall, it was discovered that Brookside Brothers had only kept the 8 minute clip and failed to retain any other surveillance video. At the end of the case, the judge issued a spoliation instruction to the jury asking them to determine if the defendants knew or could have known that the surveillance footage might be relevant to the dispute. The jury found that spoliation did occur and issued a $1 million dollar verdict in the plaintiff’s favor.
On appeal, the Texas Supreme Court came to a different conclusion. The court found that spoliation did not occur and reversed the verdict. In their decision they also explained the elements required for a finding of spoliation. They detailed that the court’s first inquiry must be whether a party failed to retain evidence and, if so, if the party had a duty to retain the evidence. If the answers to the previous inquiries are both yes, the court must then determine whether the party did so intentionally or negligently. Once the court has determined that the spoliation did occur, they can then assess a remedy. If the party committed spoliation intentionally, the jury may construe the unavailable evidence against that party. If they did so negligently, it must be determined whether the spoliation prevented the other party from making a case. The decision also instructs businesses as to how they should preserve records and electronic data although it does not give them a time-frame for retaining these records.
If you are engaged in a business dispute and are concerned that you may be liable for spoliation or need advice on any other matter, call Austin, Texas business law attorney Sanjeev Kumar at (512)323-6060.