*1 The present controversy originated as defendants' motion to compel discovery from plaintiff, filed on February 5, 2014. (Dkt. 68). District Judge Denise Page Hood referred this matter to the undersigned for hearing and determination. (Dkt. 70). After the motion was fully briefed, a hearing was held on February 26, 2014, pursuant to notice. (Dkt. 71). At the hearing, the Court decided that the motion would be held in abeyance pending the completion of plaintiff's deposition, after which the parties would file supplemental briefs. See Minute Entry dated 2/26/14. After some prodding by Court staff and a status conference on June 27, 2014, the parties finally filed their supplemental briefs on July 8, 2014 (Dkt. 131) and August 19, 2014 (Dkt. 144). The motion to compel has now evolved into a motion for sanctions based on plaintiff's alleged spoliation of evidence. This is so because plaintiff cannot produce the requested documents as they have been destroyed for a variety of reasons, which will be discussed in depth below.

According to defendants (collectively, SCI), the relationship between SCI and plaintiff began to disintegrate in early 2010 or 2011. In January 2011, plaintiff began sending and receiving work-related email NOT from his SCI e-mail account, but from an account he established with Gmail, gwb.rvg@Gmail.com. The “gwb” is a reference to his name, G. Wesley Blankenship, and the “rvg” a reference to RedViking Group, part of SCI. In 2011, plaintiff also established and used the email address gwb.research.group@Gmail.com. No later than January 2012, plaintiff retained his current attorneys to advise him in connection with his relationship with SCI. (Dkt. 131, Ex. C, January 25, 2012 e-mail between Mark High of Dickinson Wright and Anthony Rusciano of Plunkett Cooney).

On January 13, 2012, plaintiff resigned as Chairman and CEO of SCI, which resignation became effective as of February 10, 2012. (Dkt. 131, Ex. D). On February 15, 2012, SCI paid plaintiff $3 million. Around this time, plaintiff claims to have left certain electronic items with SCI, though this is disputed by SCI's Information Technology personnel. (Dkt. 131, Ex. A, No. 14). In February or March 2012, plaintiff had a bonfire where he threw his paper files related to SCI and electronic items. (Dkt. 131, Ex. E, pp. 77-79). In 2012, plaintiff also had an iPhone on which he accessed email, but “it was subsequently broken by dropping ... sometime in 2012.” (Dkt. 131, Ex. B, p. 14). On March 22, 2012, SCI requested in writing that plaintiff return all SCI files and records and SCI's laptop computer that plaintiff had been utilizing. (Dkt. 131, Ex. F). On June 15, 2012, plaintiff sent SCI a letter requesting the Corporation's books and records. (Dkt. 23-4).

On May 31, 2013, plaintiff filed this lawsuit against SCI. (Dkt. 1). In the fall of 2013, plaintiff alleges that he performed an “operating system upgrade” on his computer that resulted in the loss of e-mail from his Gmail email accounts. (Dkt. 131, Ex. B; Ex. H, Letter from D. Quick to M. McKnight on January 4, 2014). On October 2013, SCI sent its first discovery requests to plaintiff. When plaintiff responded on November 13, 2013, his production was 304 total pages—223 of which are comprised of tax returns and a real estate of appraisals, resulting in a net production of 84 pages. Plaintiff also alleged that he maintained a practice of keeping “clean” Gmail email boxes. (Dkt. 131, Ex. B, Ex. H). SCI then filed this motion to compel. According to SCI, plaintiff's response can be neatly summed up as follows: “Plaintiff cannot produce what it does not have.”

*2 While SCI contends that plaintiff should have preserved his documents as early as 2010 or 2011 because the relationship between SCI and plaintiff began to deteriorate, plaintiff contends that “dissent among officers in a corporate setting occurs in all businesses and does not necessarily mean litigation is imminent.” During this time, plaintiff had been successfully operating RedViking, an SCI subsidiary, for the direct benefit of SCI. Furthermore, plaintiff contends that he was under the impression that the parties had settled the terms of plaintiff's departure after SCI representatives had met with plaintiff and CCAD representatives in February 2012, and plaintiff and SCI executed the February 2012 agreements. Plaintiff contends that the only issue that remained was the purchase of plaintiff's shares, which was subject to the redemption process outlined in the shareholder agreement. According to plaintiff, following the execution of these agreements, plaintiff intended to move on with his career and put his SCI work behind him. He did so symbolically by having a bonfire and burning his SCI laptop, files, some personal files, and even his SCI golf balls in a bonfire. According to plaintiff, the first inkling he had of any litigation was on June 21, 2012, when SCI sent him a letter indicating for the first time that they intended to pursue claims against him. (Dkt. 131, Ex. G). Plaintiff maintains that from this point forward, he attempted to preserve the few documents that he had in his possession and never intentionally destroyed or deleted documents.

Later, in the fall of 2013, plaintiff also maintains that he unintentionally lost the great majority of his emails that he had been preserving as a result of an operating system upgrade. Plaintiff argues that there is no evidence that the loss of email due to this upgrade was intentional. Plaintiff also points out that SCI never bothered to subpoena Google or any other third parties to obtain these emails.

As explained in In re Black Diamond Mining Company, 514 B.R. 230, 237 (E.D. Ky. 2014), the court must conduct a two-step inquiry before assessing spoliation sanctions. First, the court must determine whether the party moving for sanctions demonstrated that sanctions are warranted at all. Id.This requires an affirmative answer to three questions: (1) whether there was a duty to preserve documents at the time the party with control over the documents destroyed them; (2) whether the party destroyed the documents with a culpable state of mind; and (3) whether a reasonable trier of fact would have found that the lost documents were relevant to a claim or defense in the litigation. Id., citing Beaven v. U.S. Dep't of Justice, 622 F.3d 540, 553 (6th Cir. 2010). “The party seeking the sanction bears the burden of proof in establishing these facts.” Byrd v. Alpha Alliance Ins. Corp., 518 Fed. Appx. 380, 384 (6th Cir. 2013) (internal citations omitted). Second, if the court finds that sanctions are warranted, it may then use its discretion to fashion an appropriate penalty. Black Diamond, 514 B.R. at 237, citing Adkins v. Wolever, 554 F.3d 650 (6th Cir. 2009) (en banc). The Court is only limited by the goals of fairness and punishing wrongdoers. Adkins, 554 F.3d at 652 (explaining that a proper sanction will “ ‘level[ ] the evidentiary playing field and ... sanction[ ] the improper conduct.’ ”) (quoting Vodusek v. Bayliner Marine Corp., 71 F.3d 148, 156 (4th Cir. 1995)).

The first question to be answered is whether plaintiff had a duty to preserve documents and evidence. An obligation to preserve evidence arises “when a party should have known that the evidence may be relevant to future litigation.” Beaven, 622 F.3d at 553, quoting Kronisch v. United States, 150 F.3d 112, 126 (2d Cir. 1998). This can, and often does, happen earlier than when the actual lawsuit is filed. Black Diamond, 514 B.R. at 237, citing O'Brien v. Ed Donnelly Enters., Inc., 575 F.3d 567 (6th Cir. 2009) (finding that the duty to preserve evidence arises when a party merely “should have known that the evidence may be relevant to future litigation,” quoting John B. v. Goetz, 531 F.3d 448, 459 (6th Cir. 2008)). Plaintiff claims that such a duty only arises when a party is formally notified of the claims, citing Ross v. American Red Cross, 567 Fed. Appx. 296 (6th Cir. 2014). However, the Court in that case held that mere knowledge of the plaintiff's personal injury, which occurred during a blood donation, was not sufficient knowledge by the defendant that litigation was likely to occur. Rather, under those circumstances, the Court concluded that the trial court properly determined that the plaintiff provided no evidence to suggest that the defendant was aware of potential litigation until it received a letter from the plaintiff's attorney. Id. at 303. As discussed below, the factual circumstances here are vastly different from those presented in Ross and, in any event, the Sixth Circuit did not adopt a “formal notice” bright line rule as suggested by plaintiff.

*3 Here, plaintiff claims, essentially, that all of the parties' issues were “resolved” after negotiations led to his resignation in early 2012 and that he had no reason to anticipate any potential litigation; thus there was no need to preserve documents. However, according to the counter-complaint filed by SCI, plaintiff is accused of a variety of actions throughout 2011, including various breaches of fiduciary duty. Plaintiff does not claim that he was unaware of these allegations prior to the destruction of his laptop and other documents in March 2012. According to SCI, as part of his scheme, plaintiff sought in December 2011 to force SCI to sell Red Viking Group (a subsidiary of SCI) to him at an unconscionably low price or to force SCI to buy his SCI stock in at an unconscionably high price. (Dkt. 26). SCI says that plaintiff's attempts failed and in January 2012, Blankenship continued with an additional step in his illegal scheme by advising SCI that he would terminate his employment with the Company effective February 10, 2012 and that at the time of his termination he would cause, both directly and indirectly, substantial financial distress and possible economic ruin to the Company by virtue of representations he would make to existing customers and existing prospects of the Company. (Dkt. 26). According to SCI, ultimately, Blankenship threatened that if he was not paid $3 million by February 15, 2012, and provided certain relief from the terms of his employment agreement, he would cause the threatened financial harm to SCI to occur. SCI concluded that plaintiff's threats placed at risk substantial existing and pending contracts that would materially cripple the financial well-being SCI and require termination of well over half of its employees. SCI contends that, based on the extreme duress caused by plaintiff's unlawful threats, in violation of his fiduciary duties owed to SCI, it ceded to his demands and made payment on February 15, 2012 of $3 million as evidenced by the Fee Agreement of the same date and the First Amendment to Employment, Noncompetition and Confidentiality Agreement. (Dkt. 26).

In reviewing the agreements reached on February 12, 2012, along with the history of the parties' extensive disputes as documented throughout the record, including the complaint, the counter-complaint, and the briefing of the motion for preliminary injunctive relief, it seems quite clear that the parties' disputes did not “resolve” on February 12, 2012. Plaintiff does not claim in his supplemental response that those agreements released any of the claims that are at issue in this lawsuit and certainly not all of the claims arise from the agreements reached that day.[1] While plaintiff contends that he had never heard anything about SCI's concerns relating to the noncompetition agreement or any breaches of fiduciary duty before June 2012, no evidence or affidavit is cited in support of this claim. (Dkt. 144, Pg ID 4632). To accept plaintiff's version of the facts, the Court would have believe that the extensive disputes[2] between the parties simply disappeared on February 12, 2012 and then, out of the blue, re-appeared only weeks after plaintiff destroyed his laptop and all of his SCI documents in a fire. In the view of the undersigned, this scenario is entirely implausible. Thus, the Court concludes that plaintiff did, in fact, have a duty to preserve documents and evidence at the time he burned his laptop and other documents in a fire.

The “ ‘culpable state of mind’ factor is satisfied by a showing that the evidence was destroyed ‘knowingly, even if without intent to [breach a duty to preserve it], or negligently.’ ” Beaven, 622 F.3d at 554, quoting Residential Funding Corp. v. DeGeorge Fin. Corp., 306 F.3d 99, 108 (2d Cir. 2002). “Assessing the defendant's state of mind is important because the Court can impose different spoliation sanctions, calibrating the severity of the remedy on the party's degree of fault under the circumstances.” Black Diamond, 514 B.R. at 239, citing Adkins, 692 F.3d at 504; Beaven, 622 F.3d at 554. The veracity of a defendant's stated reasons for destroyed evidence “is an issue of credibility.” Beaven, 622 F.3d at 554. In Pollard v. City of Columbus, 2013 WL 5334028, *4 (S.D. Ohio 2013) (internal quotations and citations omitted), the Court observed:

*4 As to the laptop and documents destroyed in the fire, it is easy for the Court to conclude that plaintiff had a sufficiently culpable state of mind, given the conclusion that he knew or should have known that he had a duty to preserve documents and evidence and the fact that he is a highly sophisticated businessman, represented by counsel, at the time of the fire. The Court also finds it highly suspicious that the destroyed laptop was not mentioned in plaintiff's discovery responses dated November 13, 2013, even though he was specifically asked to identify all computers that he used from January 1, 2009 forward, their current location, and whether he still had them in his custody and whether any information was erased, deleted or otherwise removed from the computer. (Dkt. 131-3, Pg ID 3606). The burned and destroyed laptop is not specifically mentioned in his response. Id.[3] Only after the completeness of these discovery responses were questioned by counsel for SCI, did plaintiff's counsel draft a lengthy letter, which included a brief statement that the laptop was destroyed in early 2012. (Dkt. 131-9). Plaintiff's failure to promptly disclose the destruction of the laptop is certainly indicative of his culpable state of mind.

As to plaintiff's “system upgrade,” there is no question that a litigation hold was in place at the time plaintiff lost most of his emails. Plaintiff claims that the loss was entirely unintentional. That may be true, however, the undersigned finds his conduct to be negligent, given that he well-understood at the point in time of the upgrade the importance of preserving documents and evidence. While plaintiff is not an “IT guy” as he stated at his deposition, he is a sophisticated businessman with access to sophisticated legal counsel to advise and assist on preservation of evidence. Plaintiff has presented no evidence regarding any efforts whatsoever to support any affirmative acts of preservation, other than generic claims that he “tried” to preserve documents. Plaintiff's description of his preservation efforts reads more like he tried not to delete anything he thought was relevant, at least some of the time. This does not show a sufficient effort to preserve documents and evidence. Moreover, plaintiff's written discovery response describing that “[s]ome data was lost in a data migration during an operating system upgrade” hardly reveals the extent of the emails that were deleted during this upgrade. (Dkt. 131-3, Pg ID 3608). As plaintiff explained at his deposition, he “lost most all of my g-mails” and that he “lost all but a few very old emails between Mark I [sic] and myself and anything up until that time.” (Dkt. 131-6, Pg ID 2619). In the view of the undersigned, plaintiff's deceptively incomplete discovery response, at a minimum, also supports a finding of negligence in the system upgrade.

To assess sanctions, the Court must find that a reasonable trier of fact could conclude that the destroyed documents were relevant to the non-spoliating party's claim or defense. Black Diamond, 514 B.R. at 241, citing Beaven, 622 F.3d at 555. A party seeking sanctions may rely on circumstantial evidence to suggest the contents of the destroyed evidence. Automated Solutions Corp. v. Paragon Data Sys., 756 F.3d 504, 513-14; 2014 WL 2869286, at *6 (6th Cir. 2014), citing Beaven, 622 F.3d at 555. The moving party need not show that the lost evidence would have necessarily supported its claim; rather it must only show that it could have. Clemons v. Corrs. Corp. of America, 2014 WL 3507299, *4 n. 2 (E.D. Tenn. 2014), citing Jones v. Staubli Motor Sports Div. of Staubli Am. Corp., 897 F.Supp.2d 599, 609 (S.D. Ohio 2012) (“[T]he Sixth Circuit in Beaven has since described the third prong differently, requiring only that a party show that a reasonable trier of fact could find that the missing evidence would support that party's claim.”) (emphasis in original) (citing Beaven, 622 F.3d at 553).

*5 According to SCI, there are many e-mails that are both responsive to the discovery requests and relevant to the lawsuit, that were sent to or from plaintiff, but that were not produced by plaintiff. SCI asserts in the amended complaint that plaintiff attempted to induce SCI then-affiliate, Wilbur Dyer, to divert his efforts from SCI and siphon business and potential business away from SCI and to plaintiff. Mr. Dyer preserved much of his email and SCI asserts that these emails provide examples of what plaintiff failed to preserve and produce.

For example, SCI first points to Exhibit I, which includes excerpts of plaintiff's May 9, 2012 e-mail sent to Mr. Dyer, attaching a PowerPoint presentation to Corpus Christi Army Depot (“CCAD”), one of SCI's major customers. According to SCI, this email, sent from plaintiff's “gwbrvg @Gmail.com” address, shows plaintiff using SCI's proprietary marketing and financial data for the purpose of making a presentation to CCAD. The CCAD presentation shows that plaintiff is using the SCI's business and financial information to differentiate SCI from plaintiff's newly-formed competing business “Systems Transformation, Inc.” (STI).

Next, SCI points to Exhibit J, produced by plaintiff, who received email from the “gwbrvg@Gmail.com” account dated January 30, 2012. This email was part of a “string” of emails that reflect correspondence between plaintiff and Mr. Ronald Howe, the then “deputy program manager” for CCAD, one of the major customers of SCI. The email string refers to the letter sent by Mr. Howe on January 27, 2012 to Randy Brodzik, then president of SCI. The letter states in no certain terms that without the plaintiff's continued presence, the relationship between SCI and CCAD would be in jeopardy. At the time this email was sent, plaintiff was seeking to coerce SCI to pay him a $3 million fee to preserve the relationship between CCAD and SCI, and on February 15, 2012, SCI did in fact pay the plaintiff the sum of $3 million. The actual letter sent by Mr. Howe to SCI on January 27, 2012 is attached as Exhibit K. However, Exhibit L is the January 26, 2012 email sent by plaintiff from “gwbrvg@Gmail.com” to Mr. Dyer. Attached to the email is plaintiff's effort at a “ghost” written letter to be utilized by Mr. Howe and sent to SCI. In fact, that letter was transmitted only hours later. See Ex. K. Thus, SCI contends that plaintiff was “choreographing” a scenario wherein his importance to the SCI/CCAD relationship was promoted by a letter that plaintiff himself wrote and induced a representative of CCAD to send under his (Mr. Howe's) signature.

Next, SCI points to plaintiff's failure to produce email related to SCI's prospective target, Boeing. According to SCI, this email exposes plaintiff's manipulation and coercion that induced SCI to pay the demanded $3 million fee based on plaintiff's fraudulently represented importance to CCAD. Plaintiff produced a January 29, 2012 email from Michael D. Knight to plaintiff. Ex. M. That email presents the concern of Boeing, a substantial targeted customer of SCI, and the fact that plaintiff was leaving the Defendant SCI. However, Exhibit N, is plaintiff's January 29, 2012 email sent from the “gwbrvg @Gmail.com” account. It is evident, according to SCI, that plaintiff has “ghost” written the very letter that was sent by Mr. Knight only a few hours later. Plaintiff did not produce Exhibit P—this too was produced by non-party Mr. Dyer, instead. In addition, SCI says that there are other email exchanges between Mr. Dyer and plaintiff that were produced only by Mr. Dyer and not by plaintiff.

*6 According to SCI, several emails damaging to plaintiff and favorable to defendants were both sent and received from plaintiff's “gwbrvg@Gmail.com” address and were excluded from his production—yet, related emails were included in the production. Based on the review of the emails, it appears that the emails were sent to plaintiff's attorney and that the attorney produced them. However, SCI contends that the result is the same—that which was included in the production was favorable to plaintiff's case and that which was excluded from the production was damaging to plaintiff's case.

Plaintiff contends that SCI has failed to establish that the lost and destroyed documents are relevant. According to plaintiff, this is so because SCI claims all fail as set forth in the briefing for its motion for partial summary judgment. Plaintiff also argues that “[b]eyond relevant e-mails that have been identified by SCI and that were accidentally lost by Plaintiff, it has not identified any potential relevant materials, even just by subject matter, which may have been destroyed in the bon-fire.” (Dkt. 144, Pg ID 4636).

Plaintiff also contends that SCI cannot establish relevance because it has not established prejudice, citing, Barrette Outdoor Living, Inc. v. Mich. Resin Representatives, LLC, No. 11-CV-13335, 2013 U.S. Dist. LEXIS 108902 at *41 (E.D. Mich. Apr. 26, 2013). Specifically, plaintiff contends that SCI has failed to demonstrate how plaintiff caused SCI any prejudice to its ability to prove its counterclaims. Plaintiff points out that SCI has had the opportunity to thoroughly depose plaintiff regarding all other contacts with “SCI's clients or prospects,” has had access to all of plaintiff's SCI and RedViking e-mail accounts, and has received all e-mail transmissions between plaintiff and Dyer from Dyer. Thus, according to plaintiff, SCI had not been prejudiced in any way by the loss of plaintiff's e-mails. Plaintiff also contends that:

(Dkt. 144, Pg ID 4636-4637), citing In re Ethicon, Inc. Pelvic Repair Sys. Prod. Liab. Litig., MDL No. 2327, 2014 U.S. Dist. LEXIS 14076 at *2444 (S.D. W. Va. Feb. 4, 2014) (“prejudice is less acute when there are sources from which at least some of the allegedly spoliated evidence can be obtained ...”). While plaintiff admits to inadvertently losing e-mails during an operating system upgrade, he contends that he should not be punished for SCI's failure to mitigate against any alleged prejudice.

*7 In the view of the Court, plaintiff has not even attempted to rebut SCI's detailed claims of relevance. SCI has found and described several examples of emails that were quite likely intentionally destroyed by plaintiff and which are in fact relevant to SCI's claims. Simply because plaintiff asserts that those claims are without merit does not change the status of the documents as relevant to those claims. Notably, plaintiff has not specifically responded to the content of any of the emails identified by SCI and his claim that SCI cannot show the relevance of what is still missing truly misses the point. SCI has effectively used the examples of emails obtained from other sources to show what plaintiff failed to produce because those documents were lost or destroyed. In the Court's view, this evidence satisfies Beaven's requirement that a party establish a reasonable trier of fact could find that the missing evidence would support its claims.

The Court is also not impressed with plaintiff's claims that SCI has not established relevance because SCI has not established sufficient prejudice, that SCI received sufficient discovery from other sources, and that SCI failed to subpoena Google. Certainly SCI can and should do what it reasonably can to obtain discovery from other sources. In the Court's view, they did so. Notably, plaintiff offers no evidence that Google has retained his deleted emails, and if any party should be trying to obtain such evidence from Google, it is the party who intentionally and negligently destroyed the evidence in the first place. Moreover, whether and to what extent SCI was able to obtain discovery from other sources does not bear on this inquiry. See e.g., Pollard v. City of Columbus, Ohio, 2013 WL 5334028, at* 5 (S.D. Ohio 2013) (“Although Defendants have exhaustively listed alternative sources of evidence that the Plaintiff might employ in its case, that is not the proper inquiry. Rather, Circuit precedent requires only that the evidence be ‘relevant’ to a claim or defense.”) (citing Beaven, 622 F.3d at 553).

And, as the court explained in Barrette, the consideration of prejudice is related to the assessment and severity of the sanction imposed. Barrette Outdoor Living, 2013 U.S. Dist. LEXIS 108902 at *41 (“But, and critical in this case, a court must also consider the prejudice to the party that must proceed without the spoliated evidence.”), citing Pension Comm. of Univ. of Montreal Pension Plan v. Banc of Am. Sec., 685 F.Supp.2d 456, 467 (S.D.N.Y. 2010) (“[F]or more severe sanctions—such as dismissal, preclusion, or the imposition of an adverse inference—the court must consider, in addition to the conduct of the spoliating party, whether any missing evidence was relevant and whether the innocent party has suffered prejudice as a result of the loss of evidence.”) abrogated in part by Chin v. Port Auth. of New York & New Jersey, 685 F.3d 135 (2d Cir. 2012); Jain v. Memphis Shelby Cnty. Airport Auth., 2010 WL 711328, at *3 (W.D. Tenn. 2010) (“The severity of the sanction should correspond to the actual prejudice suffered by the party who has been denied discovery.”). The consideration of prejudice comes in the second part of the Court's spoliation analysis, not in the assessment of relevance, which is the third prong of the first step of this analysis. See Black Diamond, supra.[5]

*8 A court's “inherent powers” include “broad discretion to craft proper sanctions for spoliated evidence.” Black Diamond, 514 B.R. at 242, quoting Adkins, 554 F.3d at 651. However, sanctions must be commensurate with the level of culpability associated with each defendant. See id. at 652-53(finding that because failures to produce relevant evidence fall “along a continuum of fault—ranging from innocence through the degrees of negligence to intentionality,” the severity of a sanction should also vary), quoting Welsh v. United States, 844 F.2d 1239, 1246 (6th Cir. 1988). Moreover, the sanctions should be limited to what is necessary to punish the defendant and restore the plaintiff to the position it would have been in but for the spoliation. Adkins, 554 F.3d at 652.

Governing law generally prefers adverse inference instructions as sanctions for spoliation. Black Diamond, 514 B.R. at 242. An adverse inference instruction tells the jury to assume that the wrongdoing party “fears [producing the evidence]; and this fear is some evidence that the ... document ... would have exposed facts unfavorable to the party.” Flagg v. City of Detroit, 715 F.3d 165, 177 (6th Cir. 2013) (alteration in original), quoting Vodusek v. Bayliner Marine Corp., 71 F.3d 148, 156 (4th Cir. 1995). Generally, a permissive or rebuttable adverse inference instruction is adequate punishment for negligent spoliation. See Arch Ins. Co. v. Broan-NuTone LLC, 509 Fed.Appx. 453, 457 (6th Cir. 2012); One Beacon Ins. Co. v. Broadcast Dev. Grp., Inc., 147 Fed.Appx. 535, 541 (6th Cir. 2005) (finding a jury instruction allowing jurors to infer that missing evidence would favor the non-spoliating party was appropriate when a party destroyed evidence negligently). A non-rebuttable, mandatory adverse inference jury instruction is considered proper if the court finds that a party's destruction of evidence was intentional. Black Diamond, 242 B.R. at 242, citing Beaven, 622 F.3d at 554.

As observed in Black Diamond, these are not, however, fixed rules: “Whether an adverse inference should be permissive or mandatory must be determined on a case-by-case basis, corresponding in part to the sanctioned party's degree of fault.” Automated Solutions Corp., 756 F.3d at 513, 2014 WL 2869286, at *6, quoting Flagg, 715 F.3d at 178 (finding permissive adverse instructions appropriate even where the spoliating party acted intentionally). Indeed, as observed in Clemons, supra, non-mandatory inference instructions are a very mild sanction. The Sixth Circuit explained that a permissive instruction is “simply a formalization of what the jurors would be entitled to do even in the absence of a specific instruction.” West v. Tyson Foods, Inc., 374 Fed.Appx. 624, 635 (6th Cir. 2010). The Court thus concluded that “even if the district court had not given the instruction ..., the jury's discretion would not have been affected in any way, and thus no relief is warranted.” Clemons, at *5, quoting West, 274 Fed.Appx. at 635; see also Jain v. Memphis Shelby Cnty. Airport Auth., 2010 WL 711328, at *5 (W.D. Tenn. 2010) (explaining that such a “sanction is one of the mildest sanctions for spoliation available to the Court” and that “[t]he permissible inference is far less drastic than dismissal or even the exclusion of other evidence. In fact, a permissible inference is less punitive than a rebuttable inference that the evidence would have been favorable to Plaintiff.”); Nejo v. Tamaroff Buick Honda Isuzu Nissan, 88 Fed.Appx. 881, 888 (6th Cir. 2004)(treating jury instruction permitting, but not requiring the jury to draw an inference, as a mild sanction for spoliation). In Clemons, the District Court agreed with the Magistrate Judge's recommendation of a mandatory inference instruction where there was a finding of gross negligence in the spoliation of evidence. Clemons observed that Beaven acknowledged that a party's culpability may “rang[e] from innocence through the degrees of negligence to intentionality,” Beaven, 622 F.3d at 554, and the court recognized that the particular degree of negligence may be germane to a sanctions analysis, as all negligence does not implicate the same level of culpability. The Clemons court also pointed out, just as in Barrette, that the prejudice to the non-spoliating party is critical to this analysis. Clemons, at *6.

*9 Here, plaintiff intentionally destroyed evidence in a fire, a finding that ranks plaintiff's behavior as far more culpable than that in Clemons. Bad faith can be shown where the party destroys evidence while knowing of its value to the litigation at the time of the destruction. Black Diamond, at *240-241, citing Fharmacy Records v. Nassar, 379 Fed.Appx. 522, 524 (6th Cir. 2010) (discussing bad faith warranting dismissal as distinct from “gamesmanship or garden variety discovery abuses” and involving a “campaign of fraud”); One Beacon Ins. Co. v. Broad. Dev. Grp., Inc., 147 Fed.Appx. 535, 541 n. 3 (6th Cir. 2005) (characterizing spoliation in bad faith as “the failure to preserve evidence one knows ... to be relevant to potential litigation”); Byrd, 518 Fed.Appx. at 384-85 (finding bad faith when a party should have known that the evidence was important). In the view of the undersigned, plaintiff acted in bad faith when he burned his laptop and SCI documents in a fire, when he should have known, as discussed in detail above, that litigation was potentially likely and that such evidence was likely to be relevant to such potential litigation. For these reasons, the Court concludes that a mandatory inference instruction is appropriate. However, the Court rejects the instructions proposed by SCI as they are akin to dismissal or default sanctions, which are disfavored in the Sixth Circuit. SeeBlack Diamond, at 242-43, citing, Byrd, 518 Fed.Appx. at 385. Rather, in the view of the undersigned, the mandatory adverse inference jury instruction, at a minimum, should include the instruction that the evidence destroyed by plaintiff was favorable to SCI, but the specific language should be crafted by the trial judge if and when this matter goes to trial.

For these reasons, defendants' motion to compel, now a motion for sanctions, is GRANTED in part.

IT IS SO ORDERED.

The parties to this action may object to and seek review of this Order, but are required to file any objections within 14 days of service as provided for in Federal Rule of Civil Procedure 72(b)(2) and Local Rule 72.1(d). A party may not assign as error any defect in this Order to which timely objection was not made. Fed.R.Civ.P. 72(a). Any objections are required to specify the part of the Order to which the party objects and state the basis of the objection. Pursuant to Local Rule 72.1(d)(2), any objection must be served on this Magistrate.

In his answer and affirmative defenses to the counter-complaint, plaintiff raises the defense of release but does not explore in his supplemental brief how SCI's claims are so barred. (Dkt. 29, 119). Notably, this defense was not raised in plaintiff's motion for partial summary judgment. (Dkt. 124).

Such disputes were described by plaintiff as “intractable” in his pleadings (Dkt. 23, Pg ID 139), involving “many months of discord” prior to his resignation in January 2012 (Dkt. 23-12, Pg ID 212, ¶ 18), and continuing with SCI's refusal to produce documents necessary to calculate the value of his shares since “early 2012.” (Dkt. 23-12, Pg ID 215-16, ¶ 37).

In his response, plaintiff says that he “also had a computer at his previous home but which was not used for work; Plaintiff no longer has that computer and does not know its whereabouts.” (Dkt. 131-3, Pg ID 3606). Even assuming that plaintiff is referring to the burned and destroyed laptop, this response is, at best, deceptively incomplete.

The Court finds this argument to be not fully reflective of the record events in this case. This motion was first brought in February 2014, shortly after counsel's January 2014 letter explaining (some of) the details regarding plaintiff's missing, destroyed, and lost documents and computer. Both parties dilly-dallied with supplemental briefing on this motion and others in this case, causing significant delays in resolving this matter and others.

It is true, however, that many speak cases in terms of “relevance and prejudice” because bad faith conduct allows the court to presume both relevance and prejudice. See e.g., Barrette, supra, citing Victor Stanley, Inc. v. Creative Pipe, Inc., 269 F.R.D. 497, 533 (D. Md. 2010) (“Defendants' willful, bad faith conduct allows this Court to presume relevance and prejudice”). As discussed below in the section on the sanctions to be imposed, the Court concludes that plaintiff acted in bad faith. Thus, this finding provides an alternate ground for concluding that the destroyed evidence was relevant.