Court Order Requiring the Seizure of Documents Defeats Party’s Request for Adverse Inference

Perez v. Metro Dairy Corp., No. 13 CV 2109(RML), 2015 WL 1535296 (E.D.N.Y. Apr. 6, 2015)

In this wage and hour class action filed under the Fair Labor Standards Act (FLSA), the court found that a party’s loss of control over its documents rendered the plaintiffs’ claim of spoliation moot.

The plaintiffs sought spoliation sanctions after the defendants failed to produce copies of the plaintiffs’ payroll records, including W-2s, paycheck stubs, and cashier sheets. As a remedy for the loss of evidence, the plaintiffs asked the court to strike the defendants’ answer, affirmative defenses, and counterclaim; to accept as fact that all of the plaintiffs worked overtime, were underpaid, and were entitled to damages; to preclude the defendants from offering any evidence regarding the plaintiffs’ employment; to instruct the jury that it must draw an adverse inference against the defendants as a result of the loss of evidence; to instruct the jury that it must presume the lost evidence was relevant and favorable to the plaintiffs; and to grant attorneys’ fees to the plaintiff.

The defendants argued that no sanctions were proper because the Superior Court of New Jersey had seized their books, records, and computers on behalf of a party in another case, and that party retained control of them. During discovery, the defendants’ lawyers asked the party for documents, which returned a flash drive containing 300 pages of payroll records. Meanwhile, the plaintiffs subpoenaed records from the party and inspected the records in the party’s possession.

The court analyzed the plaintiffs’ request for the “extreme sanction” of an adverse inference under a four-part test: “(1) that the party having control over the evidence had an obligation to preserve it at the time it was destroyed; (2) that the records were destroyed `with a culpable state of mind’; and (3) that the destroyed evidence was `relevant’ to the party’s claim or defense such that a reasonable trier of fact could find that it would support that claim or defense.” (citation omitted).

Here, the court presumed that at least some of the lost evidence might be relevant, but under the specific circumstances of this case,” the plaintiffs could not satisfy either of the first two prongs. The court found that the defendants lost control over their evidence when the party to the other case seized their records within 24 hours of the court order. Although the defendants had a duty to preserve the records, they had neither the time nor the obligation to copy or back up their files in the few hours between the entry of the order and the seizure. Thus, they did not act with the required culpable state of mind. Accordingly, sanctions were not appropriate, and the court refused to grant the plaintiffs’ motion.

Read the full case:

Perez v. Metro Dairy Corp., No. 13 CV 2109(RML), 2015 WL 1535296 (E.D.N.Y. Apr. 6, 2015)


To deserve sanctions, parties must act with the requisite culpability. In this case, the defendants had a clear obligation to preserve evidence, but they had no control of their evidence once it landed in the hands of a party to another case pursuant to court order. The defendants simply obeyed a court in turning over the records; their intent was not to make the records unavailable to the plaintiffs.