Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-04401/USCOURTS-cand-3_05-cv-04401-19/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1331 Fed. Question

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United States District Court

For the Northern District of California

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

RITCHIE PHILLIPS, dba R&D COMPUTERS

Plaintiff,

v.

NETBLUE, INC., formerly known as

YFDIRECT, INC., et al., 

 Defendants. 

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No. C-05-4401 SC

ORDER DENYING

DEFENDANTS' MOTION TO

DISMISS THE COMPLAINT

FOR PLAINTIFF'S

FAILURE TO 

PRESERVE EVIDENCE

I. INTRODUCTION

Plaintiff Ritchie Phillps, dba R&D Computers, ("Plaintiff")

brings this suit against Netblue, Inc., formerly known as

YFdirect, et al. ("Defendants") alleging violations of the

Controlling the Assault of Non-Solicited Pornographic and

Marketing ("CAN-SPAM") Act of 2003, 15 U.S.C. §§ 7701 et seq. and

California Business and Professions Code §§ 17529 et seq. See

Complaint. Presently before the Court is Defendants' Motion to

Dismiss the Complaint for Plaintiff's Failure to Preserve

Evidence. See Motion. 

II. BACKGROUND

This Order assumes familiarity with the background of the

case, discussed in the Court's December 12, 2006 Order Denying

Defendants' Motion for Leave to Amend the Answer. See Docket No.

146.

All or most of the emails which form the basis of this action

are not traditional text-based messages. Rather, they consist, in

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significant part, of hyperlinks. See Declaration of Steve Atkins

in Support of Defendants' Motion ("Atkins Decl."), at 2;

Opposition at 5. When the recipient opens the email, the

recipient's email program reads some of these hyperlinks and

displays images which reside on a remote web-server; the images

themselves are not contained in the email, rather the email

contains instructions which tells the recipient's email program to

display the images contained on the server. See Atkins Decl. at

2; Opposition at 5. 

Other hyperlinks contained in the email, when clicked by the

recipient, direct the recipient's web browser to an advertisement. 

Id. at 3. However, frequently the recipient's web browser is not

directly taken to an advertisement, but is first taken to an

intermediary website, namely that of the advertiser's "affiliate"

which sent the email. This site then automatically redirects the

recipient's web browser to advertisement located on the

advertiser's server. Id. at 5. 

Defendants do not claim that Plaintiff destroyed any of the

emails containing these hyperlinks. See Motion. Rather,

Defendants fault Plaintiff, first, for not preserving the images

which these hyperlinks should display when the email is open, see

Motion at 3, and claim that the hyperlinks contained on these

emails can no longer be used to gather these images because

"[m]any of the image files no longer exist on the remote webservers." Atkins Decl. at 3. Defendants do not allege that

Plaintiff has ever had possession or control of these remote webservers. See id.; Motion. 

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Defendants also fault Plaintiff for not preserving the URLs

from the series of websites to which a recipient's web browser

would be directed upon clicking an advertisement link in the

email. See Reply at 7. Defendants state that the advertisement

links contained in the emails are no longer active, but make no

claim that Plaintiff had any role in their deactivation. See

Motion at 5. 

 

III. LEGAL STANDARD

A district has the authority to impose sanctions based on its

inherent power "to manage [its] own affairs so as to achieve the

orderly and expeditious disposition of cases." Chambers v. NASCO,

Inc., 501 U.S. 32, 43 (1991)(internal quotations omitted). This

authority extends to the imposition of sanctions for discovery

misconduct. Unigard Sec. Ins. Co. v. Lakewood Engineering & Mfg.

Corp.,982 F.2d 363, 368 (9th Cir. 1992). 

Upon finding that a party has spoiled or destroyed evidence,

a court may sanction it in one of three ways: by giving an adverse

inference instruction to the jury; by excluding certain testimony

which is based on the spoiled or destroyed evidence; or, in

extreme or "outrageous" cases, dismissing the claim of the

responsible party . In re Napster Copyright Litigation, MDL-00-

1369, --- F. Supp. 2d ---, 2006 WL 3050864, *4 (N.D. Cal. Oct. 25,

2006) (collecting cases).

Fundamentally, a court’s decision whether to sanction a party

for allegedly spoiling or destroying evidence depends on a finding

that the party had a duty to preserve the evidence in question,

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which it breached. See id. at *3. Only after answering this

question in the affirmative, need the court determine what, if

any, sanctions are appropriate. See id. at *8.

IV. DISCUSSION

Determining whether a party breached its duty of preservation

requires a court to determine: 1) the scope of the accused

party’s duty of preservation, 2) whether the evidence in question

falls within this scope, and 3) whether the actions taken by the

accused party violated this duty. See id. at 5-8 (following these

steps).

As noted above, Defendants have not alleged that Plaintiff

destroyed or spoiled the actual emails which they received, i.e.

the email messages containing a combination of text and

hyperlinks. See Background supra. Rather, Defendants argue that

Plaintiff had the obligation to memorialize the emails as they

would have appeared if opened in an email program soon after their

receipt, i.e. with the images which the email program would have

displayed upon automatically accessing the remote web-server where

those images resided. See Motion at 3-4. Defendants further

argue that Plaintiff had the affirmative obligation "to record the

series of URLs . . . to get to the final website," to which a

recipient would be directed upon clicking the advertisement

hyperlink in the email. Reply at 7. 

In other words, Defendants maintain that Plaintiff should

have: 1) opened the emails they received; 2) then captured or

recorded the images which Plaintiff's email program would have

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displayed upon opening the email and automatically following the

hyperlinks it contained; 3) clicked on any advertisement hyperlink

contained in the email; and 4) recorded the URLs of the websites

to which Plaintiff's web browser would have been directed upon

clicking the advertising link, including the URLs of websites

which did not display any information to Plaintiff, but rather

just directed Plaintiff's web browser to another website. 

The absurdity of this argument is patent. In WM. T. Thompson

Co. v. General Nutrition Corp., the court stated the following

rule defining the scope of a party's duty of preservation in a

civil matter, which has been accepted by district courts

throughout the Ninth Circuit:

While a litigant is under no duty to keep or retain

every document in its possession once a complaint is

filed, it is under a duty to preserve what it knows, or

reasonably should know, is relevant in the action, is

reasonably calculated to lead to the discovery of

admissible evidence, is reasonably likely to be

requested during discovery, and/or is the subject of a

pending discovery request.

593 F. Supp. 1443, 1445 (C.D. Cal 1984). The fundamental factor

is that the document, or other potential objects of evidence, must

be in the party's possession, custody, or control for any duty to

preserve to attach. See MacSteel, Inc. v. Eramet North America,

No. 05-74566, 2006 WL 3334011, *1 (E.D. Mich. Nov. 16, 2006);

Towsend v. American Insulated Panel Co., 174 F.R.D. 1, *5 (D.

Mass. 1997) ("[T]he duty [to preserve evidence] does not extend to

evidence which is not in the litigant's possession or custody and

over which the litigant has no control."). Indeed, to preserve

means "to keep safe from injury, harm, or destruction." Webster's

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Third New International Dictionary (Unabridged), at 1794 (1976). 

One cannot keep what one does not have. 

Defendants do not complain that Plaintiff failed to keep safe

from harm or destruction what Plaintiff had; they admit that

Plaintiff retained the emails as they were sent to him. See

Motion and Reply. Rather, they complain that Plaintiff did not

memorialize other evidence to which the emails could have lead

Plaintiff. This is not a complaint regarding Plaintiff's alleged

failure to preserve evidence, but rather Plaintiff's alleged

failure to gather evidence. See id. at 940. The law imposes no

obligation upon a party to gather evidence other than the

requirement that a party have sufficient evidence to support their

claim. The question whether either party in this action has met

that requirement is one which will be decided by the jury.

V. CONCLUSION

For the foregoing reasons, Defendants' Motion to Dismiss the

Complaint for Plaintiff's Failure to Preserve Evidence is DENIED. 

The issue of any sanctions, which Plaintiff raises in its

Opposition, will be resolved following trial.

IT IS SO ORDERED.

Dated: January 22, 2007

 

UNITED STATES DISTRICT JUDGE

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