Hynix Semiconductor, Inc. v. Rambus, Inc., No. C-00-20905 RMW (N.D.Cal. Jan. 4, 2006).
In a patent infringement suit, the plaintiffs argued the defendant's claims should be dismissed based on the defendant's adoption of a document retention policy that resulted in the destruction of potentially relevant electronic and paper documents. Prior to filing the litigation at issue, the defendant developed a document retention policy requiring the destruction of e-mail contained on backup tapes after three months. In addition, the defendant held several "Shred Days" during which employees were instructed to follow the retention policy guidelines to determine what to keep and what to throw away. In assessing the plaintiffs' argument, the court noted the evidence failed to show the defendant targeted any specific document or category of relevant documents with the intent to prevent production in the upcoming lawsuit. The court further found the defendant's adoption of the policy was not designed to prevent the plaintiffs from obtaining evidence that would be helpful to the plaintiffs' defense. For these reasons, the court declined to accept the plaintiffs' argument and declared, "[The defendant's] adoption and implementation of its content neutral Document Retention Policy in mid-1998 was a permissible business decision... [and] did not constitute unlawful spoliation."

Sony Computer Entertainment Am., Inc. v. Filipiak, 2005 WL 3556676 (N.D.Cal. Dec. 27, 2005).
The plaintiff sought injunctive relief and damages claiming the defendant sold products that allowed users to play illegal copies of the plaintiff's PlayStation video games. After receiving a cease-and-desist letter from the plaintiff's attorneys, the defendant signed the letter and agreed to an injunction prohibiting the marketing, sale, and distribution of the products. Although the defendant removed the products from his Web site, he continued to sell them. After confronting the defendant about his violation of the previous agreement, the parties executed a Consent Judgment against the defendant for an undetermined amount, which was to be based on further discovery. As a part of the discovery provisions, the defendant agreed he would not destroy any documents or computer files reflecting sales of his products. During discovery, the defendant's hard drive was examined by a computer forensic expert, who determined thousands of files had been deleted from the hard drive just days before production of the hard drive. The deleted files included numerous documents with titles indicating they were sales records. Finding a "significant" statutory damage award was warranted under the circumstances, the court awarded more than $6 million in damages. The court stated, "[the defendant] intentionally and in bad faith violated the terms of the Consent Judgment as well as his discovery obligations under Rule 26 of the Federal Rules of Civil Procedure."

Electronic Funds Solutions v. Murphy, 36 Cal.Rptr.3d 663 (Cal. Ct. App. 2005).
In a lawsuit involving various business tort claims, the defendants appealed a default judgment and argued the trial court abused its discretion. During discovery, the plaintiffs' computer forensic expert discovered four of the defendants' hard drives had been "wiped" after the date the court ordered their production. The expert further concluded data had been copied from the hard drives before the wiping and selected data was reinstalled after the wiping. On one of the computers, the defendants appeared to have aborted the data wiping program minutes before they were required to turn it over to the plaintiffs' expert. Based on the defendants' intentional data destruction, the court entered a terminating sanction and awarded a default judgment of $24 million in punitive and compensatory damages in favor of the plaintiffs. On appeal, the court upheld the terminating sanctions in light of the "defendants' brazen violation of a discovery order in the face of an express warning." The court stated, the "Plaintiffs recovered e-mails from the computer only because defendants had not run the program properly...defendants' actions have made it virtually impossible to determine what items defendants destroyed." The court remanded the case, finding the damage award inconsistent with the amount sought in the complaint.

Communications Ctr., Inc. v. Hewitt, No. S-03-1968 WBS KJM (E.D. Cal. Apr. 5, 2005).
In a case arising from misappropriation of trade secrets, unfair competition, and other allegations, the plaintiff brought a motion for terminating sanctions against the defendant for violating a magistrate's discovery order. The order required the defendant to produce a compact disc containing mirror images of any responsive hard drives in the defendant's possession. The production was to be designated for "Attorney's Eyes Only" and no documents were to be withheld from production. Although the defendant produced three CDs, the CDs were not mirror images of the defendant's hard drives. The defendant supplemented the production with ten discs, which also failed to contain mirror images. Days after the production, the defendant ran a software-wiping program called 'Evidence Eliminator' on three of the hard drives. The defendant claimed he purchased the program only after learning the true meaning of the "mirror image" as set forth in the magistrate order. He further stated he used the program to cover up evidence of an affair and to prevent disclosure of embarrassing Web sites. The defendant further admitted he re-installed an operating system on one of the drives, despite knowing that this would destroy data on the drive. The magistrate found this conduct "a stark affront to the judicial process." Noting the destroyed data was "gone forever," the magistrate awarded the plaintiff over $145,000 in costs and fees. The magistrate further recommended that a default judgment be entered for six out of the eight causes of action.