*1 Pending before the Court is plaintiff Daniel Gruenstein's motion for sanctions pursuant to Federal Rule of Civil Procedure 37(e) for spoliation of electronically stored information (ESI). [192].[1] On February 8, 2022, the District Judge expanded the referral of this case to the undersigned to include the preparation of a report and recommendation respecting plaintiff's motion. [193]. Defendant Lauri Sue Browning has filed a response opposing the sanctions motion. [194]. The Court held a motion hearing on April 28, 2022 [198], after which Gruenstein submitted an affidavit in support of the motion [199] and Browning filed a supplemental response [201]. For the following reasons, the undersigned respectfully recommends that the District Judge grant Gruenstein's motion.

Gruenstein, a pediatric physician, see [28] 3, at ¶¶ 19-20, filed this suit on March 27, 2017. [1] 2. Initially proceeding under the pseudonym John Doe, Gruenstein alleged that three John Doe defendants engaged in defamation per se by making false statements about him on medical review websites. [Id.] 1-2. One review (the January Vitals Review), posted to the website vitals.com on January 1, 2017, declared that Gruenstein was a “convicted child sex predator.” [Id.] 4. Gruenstein claims that Browning–his ex-wife–posted the January Vitals Review, but Browning denies this. [28] 6; [56] 9-10.

On July 19, 2017, Gruenstein, through his former counsel, sent Browning a settlement demand letter. [134-2]. This letter informed Browning that Gruenstein had sued several unknown parties in the Northern District of Illinois, and that Gruenstein had purportedly obtained documents, via expedited discovery, that showed that Browning's personal cell phone had been used to make the January Vitals Review. [Id.] 1-2.[2] The letter also cautioned Browning that she had “a duty and obligation to preserve the existing state of any and all documents, electronic or otherwise, relevant to the matters discussed herein.” [Id.] 8. Finally, the letter mentioned “penalties for spoliation of evidence” and suggested that Browning “preserve all applicable hard drives and electronic devices.” [Id.].

Gruenstein filed an amended John Doe complaint on July 31, 2017 that named Browning as a defendant. [12]. On November 30, 2017, Gruenstein filed a second amended complaint under his own name, specifically alleging that Browning made the January Vitals Review. [28].

*2 Gruenstein's motion concerns the alleged spoliation of an iPhone 6S 64 GB Rose Gold cell phone (the iPhone) formerly owned by Browning. It is undisputed that, prior to October 2020, Gruenstein did not make a formal discovery request for the iPhone. See [194] 2. Indeed, Gruenstein did not appear to pursue the iPhone at all until his current attorney entered the case in October 2020. See [114] (appearance by attorney Kuehl on October 8, 2020); [116-1] 1 (October 9, 2020 email from Kuehl to defense counsel asking that counsel “confirm that the hard drives and Ms. Browning's phone have been and still are being preserved”). Browning asserts that, sometime between November 3, 2020, and December 10, 2020, she realized that she no longer had the iPhone. [194] 2-3. Gruenstein first learned that Browning no longer possessed the iPhone on December 10, 2020. [126] 1-2.

Browning testified at her February 2021 deposition that the iPhone was probably not password-protected on January 1, 2017. [142] 22-23, at 81:24-82:7; [id.] 38, at 144:4-13. When the iPhone stopped working properly, Browning returned the iPhone to her cell phone provider, Verizon, in exchange for $200. However, Browning did not remember when the exchange had occurred. [Id.] 5, at 11:15-12:4; [id.] 12-13, at 41:3-42:11.

After Browning's deposition, Gruenstein subpoenaed Verizon for documents that would show when Browning exchanged the iPhone, see [136], and some of these documents were submitted as an exhibit to the sanctions motion. [192-1]. But the documents do not definitively establish when Browning returned the iPhone to Verizon. One document merely reflects that Verizon made the following entries in its records respecting Browning's account on September 20, 2017: “Claim Denied For Program Abuse(WT). Claim Cancelled. Incident Type: Damaged. Shipping Email: Null.” [192-1] 3. A second document reflects that “Several Remarks Regarding Trade-In” were made respecting Browning's account on February 20, 2018: “Retail trade-in initiated” and “Trade-in Applied: $200.00 Remaining Balance Account Credit: $0.00.” [Id.] 4. In the undersigned's view, it is unclear from this latter record whether February 20, 2018 represents the date on which Browning submitted the iPhone, the date on which Verizon memorialized the trade-in, the date on which it issued Browning the $200, or some other event.

On February 2, 2022, Gruenstein filed the pending sanctions motion. [192]. Gruenstein argues that, even though the iPhone “has always been the critical device for imaging in this case” [id.] 9, Browning either intentionally spoliated it or failed to take reasonable steps to preserve it. Gruenstein contends that an imaging of the iPhone would have established whether the iPhone was password-protected at the time of the January Vitals Review. According to Gruenstein, “the only way to potentially determine whether the phone in question was password-protected, from an ESI perspective, would be to image the actual phone.” [Id.] 9.[3] Gruenstein also contends that an imaging of the iPhone could have established whether Browning used the iPhone to visit vitals.com on January 1, 2017. [Id.]. Because the iPhone has been spoliated, Gruenstein asks that the Court either enter a default judgment against Browning, issue an adverse inference instruction, or sanction Browning “in any manner that it considers just and equitable.” [Id.] 9-10.

*3 Before turning to the merits, the Court addresses a threshold issue of whether Gruenstein's motion is timely.

In the parties’ joint status report of January 24, 2022, Gruenstein stated that he had been “holding off on a FRCP 37(e) motion with respect to” the iPhone in the hopes that the parties would resume settlement talks, but that he was now prepared to file the motion given defendant's then-recent indication that she did not want to pursue settlement. [189] 2. The undersigned subsequently entered a minute order questioning whether the proposed motion would be timely, given that fact discovery closed on January 21, 2022, and whether it was outside the scope of the additional fact discovery authorized by the District Judge on April 14, 2021. See [190].

Gruenstein argues that the motion is timely because a Rule 37(e) motion “is not a fact discovery motion, but rather a dispositive one, and, even if it is arguably part of the ‘related motion practice’ mentioned in Judge Wood's April 14, 2021 Order ... there is no way it could have been filed and heard before the closure of fact discovery on January 21, 2022.” [192] 2. Gruenstein further contends that he raised the sanctions issue in his motion for leave to take additional discovery,[4] and that “the possibility of a sanctions motion, implicit or otherwise, has been on the table; otherwise, there would be no point in allowing additional discovery as to Browning's disposal of the phone[.]” [Id.] 3. Browning responds that Gruenstein's motion is a pure discovery motion that should be denied because it was filed after the close of fact discovery. [194] 5-6. She also argues that Gruenstein was not diligent in bringing the motion: even though Gruenstein learned in December 2020 that the iPhone had been exchanged, he waited until February 2022, nearly 14 months later, to bring the sanctions motion. [Id.] 6-8.

Rule 37 “does not contain any specific reference to the timing of the filing of a motion seeking spoliation sanctions.” Goodman v. Praxair Servs., Inc., 632 F. Supp. 2d 494, 506 (D. Md. 2009). However, courts have identified several “factors that can be used to assess the timeliness of spoliation motions.” Id. “These factors include how long after the close of discovery the relevant spoliation motion has been made; the temporal proximity between a spoliation motion and motions for summary judgment; whether the spoliation [motion] was made on the eve of trial; whether there was any governing deadline for filing spoliation motions in the scheduling order issued pursuant to Federal Rule 16(b) or by local rule; and the explanation of the moving party as to why the motion was not filed earlier.” GMS Indus. Supply, Inc. v. G&S Supply, LLC, No. 2:19-CV-324 (RCY), 2022 WL 853626, at *4 (E.D. Va. Mar. 22, 2022) (internal quotation marks omitted).

The Court recommends that the District Judge find that Gruenstein's motion is timely. First, the motion was filed on February 2, 2022, only thirteen days after fact discovery closed on January 21, 2022. [187]. Furthermore, granting the motion will not necessitate further discovery; the only relief that Gruenstein seeks is a sanction against Browning for the alleged spoliation of the iPhone. See GMS Indus. Supply, 2022 WL 853626, at *5 (Rule 37(e) motion filed after close of fact discovery was timely because, inter alia, “the relief sought will not entail reopening discovery”). Second, there are no pending summary judgment motions in this case, nor is there a deadline for the parties to file dispositive motions. Although the District Judge initially set a deadline of April 15, 2021 for the filing of dispositive motions [108], that deadline was entered before Gruenstein's motion for additional fact discovery was granted and the case was referred to the undersigned for discovery supervision. [123, 136]. Third, no trial date has been set in this case. Cf. GMS Indus. Supply, Inc., 2022 WL 853626, at *4 (sanctions motion filed less than 100 days before trial was timely). Fourth, none of the scheduling orders previously entered in this case set a deadline for filing sanctions motions. The undersigned's weighing of these factors suggests that Gruenstein's motion is timely.

*4 Finally, the Court must consider “the explanation of the moving party as to why the motion was not filed earlier[.]” Goodman, 632 F. Supp. 2d at 508. Gruenstein contends that it was only in December 2021 that he received documents from Verizon and Asurion[5] confirming that Browning exchanged the iPhone, and that he reasonably sought to pursue one last round of settlement talks before asking that Browning be sanctioned. [192] 2–3. The Court concludes that this is a plausible and appropriate explanation for not filing the sanctions motion sooner. As other courts have recognized, “spoliation sanctions motions often follow only where extensive ESI recovery efforts have failed, or after forensic review gives the movant a much better idea of the quantity and nature of unproduced, deleted ESI.” GMS Indus. Supply, 2022 WL 853626, at *4 (internal quotation marks omitted). Although Gruenstein knew in December 2020 that the iPhone had been disposed of, it was unclear (because Browning could not remember) when the disposal had occurred. As Gruenstein correctly recognized in his motion for leave to take additional discovery, see [134] 7-8, establishing whether the disposal occurred before or after Browning's duty to preserve the iPhone arose is a key element of a Rule 37(e) sanctions analysis. Here, Gruenstein reasonably pursued additional fact discovery–in the form of third-party subpoenas to Verizon and Asurion–to confirm that Browning had exchanged the iPhone and when the exchange had occurred, and he filed the sanctions motion shortly after receiving this evidence. Cf. GMS Indus. Supply, 2022 WL 853626, at *4 (although movant “was aware of the alleged spoliation” for over two years, “it did not have the opportunity to have an expert perform a full forensic examination of the computers or to perform any discovery to assist in determining what and how it had been affected by [non-movant]’s alleged spoliation.”).

For these reasons, the undersigned recommends that the District Judge find that Gruenstein's motion is timely.[6]

“Spoliation of evidence occurs when one party destroys evidence relevant to an issue in the case.” Smith v. United States, 293 F.3d 984, 988 (7th Cir. 2002).

Rule 37(e) of the Federal Rules of Civil Procedure “provides the sole source to address the loss of relevant ESI that was required to be preserved but was not because reasonable steps were not taken, resulting in prejudice to the opposing party.” DR Distribs., LLC v. 21 Century Smoking, Inc., 513 F. Supp. 3d 839, 956 (N.D. Ill. 2021). “Rule 37(e) sets out five prerequisites that must be met before any sanctions may be imposed: (1) the information at issue must be electronically stored information (ESI); (2) there must be anticipated or actual litigation; (3) it must be the case that because of the actual or anticipated litigation, the information should have been preserved; (4) the ESI must have been lost because a party failed to take reasonable steps to preserve it; and (5) the lost ESI must be unable to be restored or replaced through additional discovery.” CarmelCrisp, 2022 WL 1228191, at *5.

If these five prerequisites are met, “the Court evaluates whether the party seeking the ESI was prejudiced.” CarmelCrisp, 2022 WL 1228191, at *5. “When ESI has been lost because a party failed to take reasonable steps to preserve it, the court may: (1) upon finding prejudice, order measures no greater than necessary to cure the prejudice; or (2) upon finding of intent to deprive another party of information (in which case prejudice is inferred), presume the information was unfavorable, instruct the jury of this presumption, or enter dismissal or default judgment.” Id.

Gruenstein argues, in entirely conclusory fashion, that the iPhone “was the only ESI in this case.” [192] 8-9. Browning responds, see [194] 9, that Gruenstein has failed to establish that the iPhone constitutes ESI because the parties’ stipulated ESI protective order refers only to “hard drives and/or electronic storage devices,” not cell phones. See [76] 4 (parties’ stipulated ESI order).

*5 “The Federal Rules of Civil Procedure do not define ESI.” Stanbro v. Westchester Cnty. Health Care Corp., 19 Civ. 10857 (KMK)(JCM) & 20 Civ. 1591 (KMK)(JCM), 2021 WL 3863396, at *10 (S.D.N.Y. Aug. 27, 2021). “Instead, the advisory committee's notes to Rule 34 broadly discuss[ ] ESI as covering all current types of computer-based information that are not in tangible form.” Sosa v. Carnival Corp., Case No. 18-20957-CIV-Altonaga/Goodman, 2018 WL 6335178, at *10 (S.D. Fla. Dec. 4, 2018). “The classification of evidence as ‘electronically stored’ draws a distinction between ‘information that is fixed in a tangible form’ and ‘information that is stored in a medium from which it can be retrieved and examined.’ ” Stanbro, 2021 WL 3863396, at *10 (quoting Fed. R. Civ. P. 34(a), Advisory Committee Note, 2006 Amendment).

Unfortunately, the parties have presented only cursory arguments on this threshold issue. Nevertheless, the undersigned recommends that the District Judge find that the iPhone's password-protected status constitutes ESI. Whether the iPhone was password-protected is not inherent to the physical character of the phone; rather, it is a software setting that would be electronically stored on the iPhone itself.[7] It therefore appears that whether the iPhone was password-protected on the date of the January Vitals Review constitutes “information that is stored in a medium from which it can be retrieved and examined.’ ” Stanbro, 2021 WL 3863396, at *10 (internal quotation marks omitted). Likewise, whether Browning's phone accessed the vitals.com website on January 1, 2017 constitutes ESI. Cf. Feist v. Paxfire, Inc., 11-CV-5436 (LGS) (RLE), 2016 WL 4540830, at *5 (S.D.N.Y Aug. 29, 2016) (sanctioning plaintiff under Rule 37(e) for “knowingly deleting her browsing history” on her computer). Finally, the Court observes that the parties’ stipulated ESI order does not contain a case-specific definition of ESI, let alone a definition that would exclude the iPhone's password-protected status or Browning's browsing history. See [74] 2-4 (“General Definitions” section). Although Browning points out that the ESI provides only for the imaging of “hard drives or other electronic storage devices,” [id.] 4, she does not explain why the latter term would not encompass the iPhone, nor does she explain why a provision governing the imaging of hard drives and other electronic storage devices controls what does or does not constitute ESI.

For all these reasons, the undersigned recommends that the District Judge find that the iPhone's password-protected status and Browning's browsing history each constitutes ESI.

Gruenstein argues, see [192] 5, that Browning's duty to preserve was triggered when Browning received the July 19, 2017 settlement demand letter because the letter (1) alleged that Browning used a cellular phone to make the January Vitals Review; (2) claimed that Browning's conduct subjected her to claims of defamation per se, false light, and commercial disparagement; and (3) advised Browning “to preserve the existing state of any and all documents, electronic or otherwise, relevant to the matters discussed herein.” [134-2] 2-3, 8. Browning responds that, because Gruenstein never made a demand for the iPhone before it was traded-in to Verizon, she had no obligation to preserve the phone. [194] 9. Browning also seems to argue that it would violate Fed. R. Evid. 408 to consider the demand letter in deciding whether and when a duty to preserve arose. [Id.] 9, 11.

*6 “The duty to preserve under Rule 37(e) is based on the common law, and so is triggered when litigation is commenced or reasonably anticipated.” Hollis v. CEVA Logistics US, Inc., --- F. Supp. 3d ----, 2022 WL 1591731, at *4 (N.D. Ill. May 19, 2022). A duty to preserve evidence can arise before litigation starts, and Rule 37(e), which applies to ESI “that should have been preserved in the anticipation or conduct of litigation,” expressly contemplates this scenario. See Does 1-5 v. City of Chicago, No. 18 CV 3054, 2019 WL 2994532, at *2 (N.D. Ill. July 9, 2019). “The scope of the duty to preserve includes ESI that is expected to be relevant and proportional to the claims or defenses in the litigation.” Hollis, --- F. Supp. 3d ----, 2022 WL 1591731, at *4. “Whether a duty to preserve has arisen is an objective inquiry, viewed from the perspective of the defendant at the time.” Id. “Once a party reasonably anticipates litigation, it is duty-bound to take good faith steps to preserve documents and data that may be relevant to the litigation.” DR Distribs., LLC, 513 F. Supp. 3d at 929.

The undersigned recommends that the District Judge find that Browning's duty to preserve arose upon her receipt of the July 19, 2017 demand letter or, at the latest, on July 31, 2017, when Gruenstein filed his amended complaint naming Browning as a defendant. [12] 2. The undersigned further recommends that the scope of Browning's duty to preserve encompassed the iPhone.

At the outset, the Court rejects Browning's argument that Rule 408 prevents the Court from considering the demand letter in deciding whether and when a duty to preserve arose. Browning notably fails to cite any authority to support this assertion, which is not surprising because many cases have recognized that a demand letter can trigger a duty to preserve. See, e.g., In re Marquette Transp. Co. Gulf-Inland, LLC, No. 6:18-CV-01222, 2022 WL 393640, at *3 (W.D. La. Feb. 8, 2022) (“when determining whether a party's preservation duty has been triggered, courts evaluate facts such as ... receipt or rejection of a settlement offer”); Mannina v. D.C., 437 F. Supp. 3d 1, 10 (D.D.C. 2020) (duty to preserve triggered by a “Notice of Claim”); Salvatore v. Pingel, No. CIVA 08CV00312BNBKMT, 2009 WL 943713, at *7 (D. Colo. Apr. 6, 2009) (settlement demand triggered duty to preserve).

On the merits, the July 19, 2017 settlement demand clearly triggered Browning's duty to preserve the iPhone. The letter accuses Browning of using her personal cell phone to make the January Vitals Review, it explains how records obtained from Verizon link her cell phone number to the posting, and it identifies several torts that Browning allegedly committed by making the posting. See [134-2] 2-4. Any reasonable defendant in Browning's position would have understood that litigation was reasonably anticipated at this point, and that the iPhone–the phone that Gruenstein was contending that Browning used to make the posting–would be relevant evidence in such litigation. The same analysis applies to the filing of the amended complaint on July 31, 2017: by then Browning not only had the demand letter, but the amended complaint specifically alleged that Browning had made the January Vitals Review. [12] 5, at ¶¶ 38-40. That Gruenstein had not made a demand for the iPhone itself is not dispositive here: “[t]he duty to preserve does not necessarily start when a formal discovery request is made because a variety of events”–including in this case the receipt of the demand letter and the filing of the amended complaint–“may alert a party to the prospect of litigation.” Does 1-5, 2019 WL 2994532, at *2.

Gruenstein argues that the iPhone is relevant to respond to Browning's contention that her iPhone was not password-protected when the January Vitals Review was posted. [192] 9. Although Gruenstein's motion barely develops this critical point, it appears that Gruenstein's argument is that, if the iPhone had not been password-protected in January 2017, it is conceivable that someone other than Browning could have used the iPhone to make the January Vitals Review. In contrast, if the iPhone had been password-protected, it is more likely that only someone who knew the password, such as Browning herself, could have used the iPhone to make the posting. In response, Browning disputes the accuracy of Gruenstein's claim that she has maintained throughout the litigation that her phone was not password-protected. [194] 10-11. According to her supplemental opposition brief, Browning “has consistently maintained that she is unsure of whether the phone was password protected.” [201] 2.

*7 “Under general discovery principles, the party seeking to compel discovery has the burden of showing relevance.” Hollis, --- F. Supp. 3d ----, 2022 WL 1591731, at *5. “This burden is not a high standard for at least two reasons. First, relevance is determined under the standard in Federal Rule of Civil Procedure 26(b)(1), not the standard of Federal Rule of Evidence 401, which itself is not a high standard. Second, the principle that the party with access to the proofs generally bears the burden on an issue should temper, at least to some extent, the quantum necessary to meet the burden.” Id. (internal citation omitted).

The undersigned recommends that the District Judge find that the password-protected status of the iPhone is relevant to whether Browning is the author of the January Vitals Review. To prevail on his claim of defamation per se, plaintiff must show that “the defendant made a false statement about the plaintiff.” Doctor's Data, Inc. v. Barrett, 170 F. Supp. 3d 1087, 1102 (N.D. Ill. 2016) (internal quotation marks omitted). Here, Browning has denied authorship of the January Vitals Review. See [56] 10, at ¶ 48. If Browning were to testify at trial–just as she testified at her deposition[8]–that her iPhone was not password-protected, such testimony would (if credited by the fact-finder) tend to expand the universe of potential authors of the January Vitals Review to anyone who had access to the phone. See Linda Greene, Mining Metadata: The Gold Standard for Authenticating Social Media Evidence in Illinois, 68 DePaul L. Rev. 103, 104 (2018) (“The problem is that the defendant denies that she authored the statement–her account must have been hacked. Fortunately, Facebook records reveal the internet protocol (IP) address of the computer used to create the post, which is then linked to a device within the defendant's exclusive control.”) (emphasis added). But if Gruenstein had access to the iPhone and could demonstrate that it was password-protected, such evidence could narrow the universe of potential posters to Browning and anyone who knew the password. The evidence is therefore relevant to establishing at least one of the elements of Gruenstein's defamation per se claim. Likewise, whether Browning's iPhone accessed the vitals.com website on January 1, 2017 is highly probative of whether Browning authored the January Vitals Review.

Gruenstein argues that “the ESI was lost because Browning failed to take steps to preserve it,” [192] 8, while Browning simply disputes there was a duty to preserve the iPhone. [194] 9.

Although the case law is unsettled as to which party bears the burden on this issue, see DR Distribs., LLC, 513 F. Supp. 3d at 979, there is no dispute that Browning failed to take any steps to preserve the iPhone; indeed, she voluntarily disposed of the phone by submitting it to Verizon in exchange for $200. The undersigned therefore recommends that the District Judge find that Browning did not take reasonable steps to preserve the iPhone.

The closer question is when this exchange occurred. Relying on one of the Verizon documents he obtained by subpoena, Gruenstein contends that the trade-in must have occurred on September 20, 2017. He points out that this record shows that Browning's claim was denied on that date for “Program Abuse.” [192-1] 3. At the motion hearing, Browning argued that it was unclear, based on the Verizon documents, when the exchange had occurred. The undersigned concludes that it is unnecessary to answer this question to recommend a ruling on the sanctions motion. As discussed above, the Verizon documents are vague and inconclusive, and they do not clearly suggest whether the exchange occurred on or around September 20, 2017 or February 20, 2018. However, this dispute is immaterial to the outcome of the sanctions motion because Browning's duty to preserve arose on July 19, 2017, which is earlier than either date on which Browning might have exchanged her iPhone. Stated another way, Browning's duty to preserve existed before she exchanged the iPhone, and this is true regardless of whether the iPhone was exchanged in September 2017 or February 2018. For that reason, the undersigned recommends that the District Judge find that Browning's failure to take reasonable steps to preserve the iPhone caused the loss of the ESI at issue.

*8 Gruenstein argues that the ESI cannot be replaced because the iPhone was the “only device for imaging in this case,” and there is no way “to otherwise get the forensic contents” of the iPhone. [192] 2, 8. Browning responds that Gruenstein has other evidence that can be used to establish whether Browning posted the January Vitals Review. [194] 10. More specifically, Browning points to a different set of documents that Gruenstein obtained from Verizon that, according to Gruenstein's counsel, show that Browning authored the January Vitals Review. [Id.].

“[T]here is some authority that places the burden on the moving party to show that the lost ESI is incapable of being replaced or restored.” DR Distribs., 513 F. Supp. 3d at 980. In DR Distributors, the court expressed concern with allocating the burden of proof in that fashion because “burdens of proof generally fall on the party with better access to the information.” Id. The court also suggested that it would be “odd to place the burden on the movant” to show that the evidence cannot be restored or replaced when it was unquestionably destroyed by the non-movant. See id. at 979-80.

Regardless of which party bears the burden, the undersigned recommends that the District Judge find that the ESI at issue here–whether Browning's iPhone was password-protected at the time of the January Vitals Review, and whether the iPhone accessed vitals.com on January 1, 2017–cannot be restored or replaced through other evidence. In so recommending, the undersigned finds the affidavit of Ryan Ferreira, a senior forensic investigator with 4Discovery, to be persuasive. According to Ferreira, “[i]f we had the phone for imaging, it may have been possible to determine whether it was password-protected at the time of the posting.” [Id.] 2. Ferreira also stated that two other methods could have been used to determine if the iPhone was password-protected: imaging Browning's iCloud account and determining whether Browning had performed an iTunes backup. [Id.]. But “the likelihood of recovering that information” from Browning's iCloud account was “extremely low,”[9] while Ferreira opined that iTunes backups are “uncommon” because they involve “connecting a device to a computer, installing additional software, and leaving the device connected to the computer for a period of time to create the local backup.” [Id.] 2-3. Ferreira offered similar conclusions respecting whether other means existed for determining if Browning's iPhone accessed vitals.com. Ferreira stated that a forensic imaging of the phone “may” have permitted him to determine if the iPhone “was used to access the above website at the time of the posting.” [Id.] 3. He then opined that the odds of successfully retrieving that information by examining Browning's iCloud backup were “fairly low” and dependent on “several assumptions including that Browning never cleared browsing history on any of the” backed-up devices after the posting occurred. [Id.].

Ferreira's affidavit establishes that an imaging of the iPhone was the most promising method of determining whether the iPhone was password-protected or if it accessed vitals.com in January 2017. The affidavit also identifies other possible ways of retrieving this information, but concludes–without any contradiction or contrary evidence offered by Browning–that these methods were unlikely to replicate the lost ESI. Browning's main issue with Ferreira's affidavit is that Ferreira opined only that it “may” have been possible to obtain the ESI by imaging the iPhone. [201] 2. Browning thinks that Gruenstein needs to offer more conclusive proof to make out his spoliation claim. But the relevant question is whether the lost ESI can be restored or replaced through other means, and Browning has given the Court no reason to conclude that it can. In any event, Browning cites no authority that requires Gruenstein to definitively establish that imaging the iPhone would have established whether the iPhone was password-protected or whether it accessed vitals.com on January 1, 2017. After all, Browning is the party that voluntarily disposed of the iPhone, despite her duty to preserve it. Had Browning simply preserved the iPhone, as the law required her to do, then Gruenstein could have sought to image the iPhone, and the results would have spoken for themselves. In these circumstances, the undersigned does not believe it would be fair to require Gruenstein–who had nothing to do with the spoliation of the iPhone–to establish with certainty, several years after the fact, that imaging the iPhone would have established if the iPhone was password-protected and had accessed vitals.com.

*9 Gruenstein argues that he was prejudiced by Browning's disposal of the iPhone because “[t]he phone was the only ESI in the case,” and that imaging the phone is “the only way to potentially determine whether the phone in question was password-protected, from an ESI perspective[.]” [192] 8-9. Gruenstein also argues that imaging the iPhone is “more critical than ever” in light of “Browning's about-face with respect to Interrogatory # 5.” [192] 9. Although Gruenstein makes zero effort to develop this point, it appears to be a reference to Browning's having amended her answer to Gruenstein's Interrogatory No. 5. In her original response to that Interrogatory, which asked Browning to identify any website that she had used to communicate about Gruenstein after 2016, Browning listed vitals.com. [143] 6. In her amended response, however, Browning did not identify vitals.com. [144] 6. Browning responds that there is no prejudice because Gruenstein's counsel has previously represented that other evidence in the case–documents obtained from Verizon allegedly linking Browning's iPhone to the January Vitals Review–is “sufficient to show the posting came from the Phone.” [194] 10. Regarding her responses to Interrogatory No. 5, Browning contends that her original answer mistakenly listed vitals.com as a website that she used to communicate about Gruenstein, and that, as she testified at her deposition, she served an amended response once she noticed the mistake. [194] 11.

“Prejudice” under Rule 37(e) means that a party's ability to obtain the evidence necessary for its case has been thwarted.” DR Distribs., 513 F. Supp. 3d at 981 (internal quotation marks omitted). “Establishing prejudice when the ESI has been destroyed and the contents are unknown can be challenging.” Schmalz v. Vill. of N. Riverside, No. 13 C 8012, 2018 WL 1704109, at *3 (N.D. Ill. Mar. 23, 2018). “Under Rule 37(e), the ESI has been lost. It's gone. So, prejudice takes on an additional consideration. Courts must consider the harm caused not only under the general concept of prejudice in other Rule 37 contexts, but also in the context of determining the harm inflicted on account of the non-existence of relevant information.” DR Distribs., 513 F. Supp. 3d at 981. Recognizing the difficulties of proving prejudice in this context, the Advisory Committee's Note to Rule 37 states that:

Fed. R. Civ. P. 37(e), 2015 Amendment Advisory Committee Notes.

Rule 37(e) “does not explicitly place the burden of proving or disproving prejudice on either party, and the court is given great discretion in assessing prejudice.” Schmalz, 2018 WL 1704109, at *3. “To suffer substantive prejudice due to spoliation of evidence, the lost evidence must prevent the aggrieved party from using evidence essential to its underlying claim.” In re Old Banc One S'holders Secs. Litig., No. 00 C 2100, 2005 WL 3372783, at *4 (N.D. Ill. Dec. 8, 2005). “To evaluate prejudice, the court must have some evidence regarding the particular nature of the missing ESI.” Snider v. Danfoss, LLC, No. 15 CV 4748, 2017 WL 2973464, at *5 (N.D. Ill. July 12, 2017).

The undersigned recommends that the District Judge find that Browning's spoliation of the iPhone prejudiced Gruenstein. Here, the substance of the lost ESI–whether the iPhone was password-protected, and whether the iPhone was used to access vitals.com–is known. Furthermore, the Ferreira affidavit establishes that an imaging of the iPhone “would have been the primary–and best–evidence source for determining both password-protected status and whether the phone was utilized to visit the vitals.com website on January 1st, 2017.” [199] 3. Again, the Court notes that Browning offers no evidence to undermine those conclusions. Importantly, the spoliation of the iPhone has deprived Gruenstein of the ability to (1) narrow, by means of proving that the iPhone was password-protected, the universe of possible posters to Browning and those who knew the iPhone's password, and (2) prove, based on the browsing history on the iPhone, that Browning used the it to access vitals.com. These are meaningful impediments to Gruenstein's case because Browning has denied authoring the January Vitals Review and has testified that her iPhone was probably not password-protected in January 2017 (which allows for the possibility that someone who did not know the password could have made the posting from Browning's iPhone). Because the spoliation has “thwarted” Gruenstein's “ability to obtain the evidence necessary for [his] case,” DR Distribs., 513 F. Supp. 3d at 981, the undersigned recommends that the District Judge find that Gruenstein has been prejudiced.

*10 “When ESI has been lost because a party failed to take reasonable steps to preserve it, the court may: (1) upon finding prejudice, order measures no greater than necessary to cure the prejudice; or (2) upon finding of intent to deprive another party of information (in which case prejudice is inferred), presume the information was unfavorable, instruct the jury of this presumption, or enter dismissal or default judgment.” CarmelCrisp, 2022 WL 1228191, at *5 (citing Fed. R. Civ. P. 37(e)(1)-(2)). The Court is mindful that “intent is difficult for a moving party to prove and for a court to find,” and that “[t]he evidence used to establish intent is almost always circumstantial, not that there's anything wrong with that.” Hollis, --- F. Supp. 3d at ----, 2022 WL 1591731, at *7.

Gruenstein argues that “there is sufficient evidence demonstrating intent” to deprive him of the iPhone because (1) the exchange occurred after Browning's duty to preserve arose, and (2) Browning did not disclose that she had disposed of the iPhone until more than three years after she was named as a defendant. [192] 8. Gruenstein also emphasizes that Browning did not turn in other phones to Verizon, despite those phones being defective, and he asks rhetorically why only the iPhone was turned in. [Id.] 8-9. In response, Browning points to her deposition testimony that she turned in the iPhone to Verizon because “it wasn't working properly” and to receive a $200 credit. [194] 11-12; see also [142] 12-13, at 39:9-41:10. Browning also contends that she did not exchange her other phones “[b]ecause they didn't offer me money for them.” [142] 12, at 39:11-16.

The undersigned recommends that the District Judge find that there is insufficient evidence that Browning spoliated the iPhone with the intent to deprive Gruenstein of information. Browning has offered what the undersigned believes is a credible explanation for exchanging the iPhone: it was broken and trading it in would net her $200. In contrast, Browning did not trade-in other phones when there was no financial benefit to doing so. Furthermore, Browning was unrepresented by counsel at the time she received the July 2017 demand letter, and Gruenstein cites no evidence in the record that his ex-wife was a sophisticated litigant who knew, or obviously should have known, that her receipt of the demand letter triggered a duty to preserve the iPhone. Cf. Schmalz, 2018 WL 1704109, at *6 (defendants’ failure to identify and preserve text messages after receiving litigation hold letter “certainly constitute[ed] gross negligence” but did “not rise to level of bad faith” warranting Rule 37(e)(2) sanctions, even though one defendant was “a lawyer and should know the significance of a litigation hold letter”). Taken together, the evidence suggests that, at most, Browning's breach of her duty to preserve was negligent, not intentional. Consequently, sanctions under Rule 37(e)(2) are not available to Gruenstein.

Rule 37(e)(1) curative measures, however, are available. “Under Rule 37(e)(1), the Court may impose only those measures that are no greater than necessary to cure the prejudice resulting from the loss of the ESI.” Hollis, --- F. Supp. 3d at ----, 2022 WL 1591731, at *7. “A common curative measure is instructing the jury that it can consider the circumstances surrounding the loss of the ESI.” Id.

To address the prejudice resulting from Browning's spoliation of the iPhone, the undersigned recommends that the District Judge (1) permit Gruenstein “to present evidence to the jury regarding the [disposal] of the [iPhone] and the likely relevance of the lost [ESI]”; and (2) instruct the jury that “it may consider this information when making its decision.” Schmalz, 2018 WL 1704109, at *7. The undersigned further recommends, however, that “the jury shall not be given instructions on any presumption or inference based on the” lost ESI. Id. As in Schmalz, and because a decision on the appropriate means for presenting this evidence and argument to the jury is outside the scope of the referral of this case to the undersigned, the undersigned “leaves it to the district judge to determine the appropriate means for presenting the evidence and arguments at trial on this issue.” Id.

*11 In accordance with 28 U.S.C. § 636(b)(1)(B) and Fed. R. Civ. P. 72(b)(1), and for the reasons given above, the undersigned respectfully recommends that the District Judge grant Gruenstein's motion for sanctions [192], permit Gruenstein to present evidence of the spoliation to the jury, and instruct the jury that it may consider this evidence when making its decision.

The parties are advised that any objection to this Report and Recommendation must be filed in writing with the Clerk of the Court within fourteen days after service of a copy of this Report and Recommendation. 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b)(2). Failure to file a timely objection will constitute a waiver of objections on appeal. See Video Views, Inc. v. Studio 21, Ltd., 797 F.2d 538, 539 (7th Cir. 1986).

Bracketed numbers refer to entries on the district court docket. Referenced page numbers are taken from the CM/ECF header placed at the top of filings.

Although the demand letter is filed under seal, the Court has found it necessary to refer to the contents of this letter in its decision. However, the Court has attempted to do so without revealing any information that could be deemed confidential. To the extent the Court has discussed confidential information, however, the Court has done so because it is necessary to explain the path of its reasoning. See In re Specht, 622 F.3d 697, 701 (7th Cir. 2010); Union Oil Co. of Cal. v. Leavell, 220 F.3d 562, 568 (7th Cir. 2000).

This assertion was based on Gruenstein's counsel's undocumented “conversation with Will Ris, of 4Discovery, the agreed-upon neutral expert.” [192] 9. At the motion hearing, the undersigned indicated that Gruenstein needed to substantiate this contention with an affidavit from Ris or other similar proof, and Gruenstein responded by submitting an affidavit from a different 4Discovery employee, Ryan Ferreira. [199]. The undersigned discusses the Ferreira affidavit below.

In that motion, Gruenstein asserted that, “[i]f Browning did dispose of the phone, when she did so is critical, with respect to a sanctions analysis.” [134] 7-8.

Asurion is a company that sells insurance for Verizon products.

Given this conclusion, the undersigned need not address Gruenstein's further argument that the “dispositive” nature of the sanctions motion renders the motion timely. The undersigned recognizes that decisions from the Northern District of Illinois have treated a Rule 37(e) motion as a dispositive motion as to which a magistrate judge may only prepare a report and recommendation, particularly if the motion seeks a default judgment and/or an adverse-inference instruction. See CarmelCrisp LLC v. Putnam, Case No. 19 C 2699, 2022 WL 1228191, at *1 n.1 (N.D. Ill. Apr. 26, 2022) (citing 28 U.S.C. § 636(b)(1)(B)). For the sake of completeness, the undersigned does not find that the dispositive nature of Gruenstein's motion adds much weight to Gruenstein's position. Of more significance is the fact that Gruenstein filed the motion reasonably promptly after he completed the third-party discovery needed to establish whether and when Browning's iPhone had been exchanged.

See iPhone User Guide: Set a Passcode on iPhone, Apple, https://support.apple.com/guide/iphone/set-a-passcode-iph14a867ae/15.0/ios/15.0 (last visited Apr. 25, 2022) (discussing how to set a password on the iPhone).

Browning testified at her deposition that she did not believe her iPhone was password-protected in January 2017. See [142] 22–23, at 81:24–82:7 (concerning January 1, 2017, “I don't believe that [the iPhone] was password protected.”); [Id.] 38, at 144:4–11 (“Q: And prior to January 1st, 2017, were your phones password protected? A: No.”).

In addition, the District Judge previously denied Gruenstein's request to image Browning's iCloud account. [136].