On April 2, 2008, the Honorable James C. Francis IV, United States Magistrate Judge, granted the request of former Banc of America Securities analyst Jerry Treppel to compel Biovail Corporation and its former CEO, Eugene Melnyk, to produce additional electronic discovery in his pending litigation against them. In so doing, the Court held that Biovail's efforts to preserve electronic evidence were inadequate. In particular, Biovail failed to preserve backup tapes in existence at the time it received notice from Mr. Treppel's counsel to preserve all relevant electronic information. Judge Francis deemed defendants' inaction sufficient to constitute gross negligence or recklessness. To ameliorate the harm caused to Mr. Treppel as a result of these preservation failures, the Court ordered defendants to produce Mr. Melnyk's laptop to plaintiff's forensic expert, who will, at defendants' expense, conduct a thorough forensic examination in an effort to recover additional relevant e-mails that were deleted by Mr. Melnyk. Moreover, defendants are required to restore and search six additional backup tapes, and to potentially pay the costs of additional discovery warranted by any further relevant evidence uncovered. In reaching its decision, the Court frequently cited to Zubulake IV and Zubulake V -- seminal decisions addressing a firm's obligations to preserve and produce electronic evidence, which this firm handled and which played a significant role in recent revisions to the Federal Rules of Civil Procedure dealing with electronic evidence. Although the Court declined to go so far as to grant an adverse inference instruction, Judge Francis noted that "[i]t seems quite possible, and even likely, that documents were destroyed as a result of defendants' failure to preserve. As was the case in Zubulake V, additional evidence discovered on the backup tapes to be restored may well serve to satisfy plaintiff's burden of establishing that at least some of the destroyed documents would have been favorable to his claims, thereby entitling him to an adverse inference instruction at trial." Click here to read the April 2, 2008 Memorandum and Order in Treppel v. Biovail Corp., et al.; 03 Civ. 3002 (PKL) (JCF).
Lawyer(s):
Jeffrey L. Liddle
Christine A. Palmieri

On April 6, 2005, a jury of six women and two men awarded $2,241,009 in back pay, $6,863,100 in front pay, and $20,169,081 in punitive damages to Laura Zubulake, a former institutional equities saleswoman at UBS. Ms. Zubulake sued UBS for discriminating against her on the basis of her sex, and for retaliating against her by firing her after she complained. Ms. Zubulake was employed by UBS from August 1999 through October 2001. For 2000, her last full year of employment, she earned total compensation of $650,000. Among the noteworthy aspects of the verdict is the apparent recognition by the jury - through its award of almost $7 million in front pay - that UBS's mistreatment of Ms. Zubulake significantly hindered her prospects for future employment. In awarding punitive damages of over $20 million, the jury determined that UBS acted with malice or reckless disregard of Ms. Zubulake's rights.

Click here to read the closing arguments presented by Ms. Zubulake's counsel to the jury.

Click here to read the presentation Ms. Zubulake's counsel made in which he asked the jury for a punitive damages verdict.
Lawyer(s):
James R. Hubbard
Christine A. Palmieri

Judge: Shira A. Scheindlin