Stevenson v. Union Pacific Railroad Co.
PUBLISHED (2004)
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Rule of Law:
An adverse inference instruction for the pre-litigation destruction of evidence pursuant to a routine document retention policy is only appropriate when there is a finding of bad faith, meaning the evidence was intentionally destroyed for the purpose of suppressing the truth, not merely through negligence.
Facts:
- On November 6, 1998, a Union Pacific Railroad Company train struck a vehicle occupied by Frank and Mary Stevenson at a crossing in Vanndale, Arkansas.
- Mary Stevenson was killed in the collision, and Frank Stevenson sustained severe injuries, leaving him with no memory of the accident.
- Union Pacific had a routine 90-day retention policy for voice tapes of conversations between train crews and dispatchers, after which the tapes were reused.
- Pursuant to this policy, Union Pacific destroyed the voice tape from the day of the accident before any lawsuit was filed.
- A Union Pacific claims representative began an investigation shortly after the accident, preserving other documents like train orders, but did not request preservation of the voice tape.
- Union Pacific also had a routine policy to destroy track maintenance records after one year.
- Following this policy, Union Pacific destroyed track maintenance records relevant to the time of the accident both before and after litigation commenced.
Procedural Posture:
- Frank Stevenson and the administratrix of Mary Stevenson’s estate filed a diversity lawsuit against Union Pacific Railroad Company in the U.S. District Court for the Eastern District of Arkansas.
- The district court granted partial summary judgment in favor of Union Pacific, dismissing several negligence claims.
- The district court also dismissed defendant Operation Lifesaver, Inc. for failure to state a claim.
- The plaintiffs moved for sanctions against Union Pacific for destroying a voice tape and track maintenance records.
- The district court granted the sanctions motion, imposing an adverse inference jury instruction and an award of attorneys' fees.
- The district court granted the plaintiffs' motion in limine, precluding Union Pacific from presenting evidence to the jury to rebut the adverse inference.
- After a trial on the remaining negligence claims, the jury returned a verdict in favor of the plaintiffs.
- The district court entered judgment on the verdict and the sanctions award.
- Union Pacific appealed the judgment and sanctions order to the U.S. Court of Appeals for the Eighth Circuit, and Stevenson filed a cross-appeal.
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Issue:
Is an adverse inference instruction for pre-litigation destruction of evidence under a routine document retention policy appropriate without a finding of intent to destroy the evidence to suppress the truth?
Opinions:
Majority - Hansen, J.
No. An adverse inference instruction based on the pre-litigation destruction of evidence pursuant to a routine document retention policy requires a finding that the party acted in bad faith by intentionally destroying evidence to suppress the truth; a finding of mere negligence is insufficient. The court upheld the sanction for the destruction of the voice tape, finding the circumstances supported an inference of bad faith, but found it was an abuse of discretion to sanction the pre-litigation destruction of track maintenance records where no bad faith was shown. The court reasoned that for pre-litigation destruction under a routine policy, there must be an indication of intent to obstruct or suppress truth, not just that a party 'knew or should have known' the evidence might become relevant. For the voice tape, bad faith could be inferred because Union Pacific knew litigation was likely after a fatal accident, the tape was unique contemporaneous evidence, and the railroad preserved other evidence but not the tape. For the pre-litigation destruction of track records, these factors were not present, making the sanction an abuse of discretion. However, destruction of track records after litigation began was properly sanctioned. Finally, the court held it was an abuse of discretion to prohibit Union Pacific from presenting rebuttal evidence to explain its retention policy to the jury, as this turned a permissive inference into an irrebuttable presumption.
Analysis:
This case clarifies the standard for imposing the severe sanction of an adverse inference instruction for spoliation of evidence within the common context of corporate document retention policies. By rejecting a mere negligence standard for pre-litigation destruction, the court provides a degree of protection to corporations that follow reasonable and routine policies. However, the ruling also serves as a warning that such policies are not a shield when circumstances—such as a fatal accident and the unique nature of the evidence—strongly suggest that litigation is foreseeable and that specific evidence should be preserved. The decision emphasizes a fact-intensive inquiry into the party's intent, creating a higher bar for plaintiffs seeking such instructions but maintaining judicial power to sanction conduct that indicates a desire to suppress the truth.
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