Government Sanctioned for Destroying Evidence In False Claims Act Lawsuit

A recent district court ruling confirms that the federal government has a duty to preserve material evidence just like everyone else. From Eric Sitarchuk and Meredith Auten at law firm Morgan Lewis:

“In United States ex rel. Baker v. Community Health Systems, Inc., the U.S. District Court for the District of New Mexico upheld Magistrate Judge Alan Torgerson’s recommendation of sanctions against the federal government for failing to issue a timely and adequate litigation hold. The court held that sanctions were appropriate because the government’s actions resulted in the destruction of electronically stored information (ESI) that could have been helpful to Community Health Systems’ defense… 

Magistrate Judge Torgerson applied the general spoliation rule that the duty to preserve documents arises once a party ‘reasonably anticipates litigation.’ Under this standard, he rejected the government’s argument that it could not have reasonably anticipated litigation until it received permission from the Department of Justice to intervene in the case. Instead, Magistrate Judge Torgerson found that the ‘Government’s intervention was reasonably foreseeable after receipt of defense counsel’s letter rejecting the Government’s offer of settlement on September 5, 2008.’ … The court agreed with Magistrate Judge Torgerson’s findings regarding the timing and adequacy of the government’s litigation hold.”

Read the full update, Government Sanctioned for Destruction of Documents - Morgan Lewis»