PersonalWeb Technologies, LLC ("PersonalWeb") filed a patent infringement action against Google for infringement of its "Truenames" patents. Google filed a motion for sanctions based on a contention that PersonalWeb systematically deleted relevant emails when it reasonably anticipated litigation. PersonalWeb opposed the motion arguing that it had an email retention policy and timely implemented a litigation hold shortly after the filing of the lawsuit against Google.
In working on its analysis of the motion, the court stated that PersonalWeb's duty to preserve evidence arose when litigation became reasonably foreseeable. Google asserted that PersonalWeb anticipated litigation no later than June 2011, before it even acquired the patents-in-suit because there were discussions regarding future litigation against major technology companies during weekly lunch meetings. The court agreed that "PersonalWeb probably acquired the patents with an eye toward litigation. However, it is difficult to say that litigation was reasonably foreseeable before PersonalWeb even acquired the thing which would give it standing to sue."
Based on this analysis, the court concluded that PersonalWeb could not reasonably anticipate litigation before it acquired the patents, but it did reasonably anticipate litigation once it acquired the patents. "Accordingly, because PersonalWeb was analyzing Google technology as early as April and openly discussing litigation as early as May, the Court finds that litigation was reasonably foreseeable so as to trigger a duty to preserve evidence when PersonalWeb first acquired Truenames patents in July 2011. See Micron, 645 F.3d at 1323 ("Once the patent issued, the gun was loaded; when the targets were acquired, it was cocked; all that was left was to pull the trigger by filing the complaint.")"
Google asserted that PersonalWeb engaged in a systematic mass deletion of emails in October 2011 after its duty to preserve evidence arose. PersonalWeb countered that it had a legitimate email retention policy in place at the time that it never ordered a mass purging of email and instead consistently emphasized the importance of retention.
The court was not convinced that PersonalWeb engaged in as willful and malicious an act of destruction as Google suggests. "Nevertheless, the Court still finds that PersonalWeb spoliated evidence as a result of its failure to timely implement a litigation hold. See Napster, 462 F. Supp. 2d at 1071. Litigation was reasonably foreseeable in July 2011, yet rather than put a litigation hold in place, PersonalWeb waited a month to implement its first email retention policy, which despite the name, mandates the destruction of some emails without a backup. An additional four months lapsed before PersonalWeb finally ensured the preservation of evidence by implementing the litigation hold."
The court then found that there was not significant prejudice to Google because there was no evidence that the emails that were destroyed would have had a significant bearing on the outcome of the case. The court, therefore, concluded that severe sanctions were not warranted. Nonetheless, the court concluded that some sanctions should be awarded to deter future misconduct. "Because Google has suffered little or no substantive prejudice, and because it appears that PersonalWeb's conscious disregard of its duty to preserve evidence was motivated by cost-saving, the Court thinks that monetary sanctions are sufficient and appropriate in order to punish PersonalWeb's misconduct, deter future bad behavior, and make Google whole for its resulting additional discovery costs. . . . Accordingly, Google shall be awarded monetary sanctions sufficient to reimburse it for reasonable attorney's fees and costs associated with its spoliation-related discovery and motions practice."
PersonalWeb Technologies, LLC v. Google Inc., Case No. C13-01317-EJD (HRL) (N.D. Cal. Feb. 13, 2014)
The authors of www.PatentLawyerBlog.com are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. We represent inventors, patent owners and technology companies in patent licensing and litigation. Whether pursuing patent violations or defending infringement claims, we are aggressive and effective advocates for our clients. For more information contact Stan Gibson at 310.201.3548 or SGibson@jmbm.com.