*1 Before the Court is Plaintiff, Scrap King LLC's (“Scrap King” or “Plaintiff”), Renewed Motion for Sanctions Pursuant to Rule 37(e), Federal Rules of Civil Procedure and the Inherent Authority of the Court (“Motion”) (Doc. 226)[1] and Defendant, Stericycle, Inc.’s, (“Stericycle” or “Defendant”) Response in Opposition to Plaintiff's Renewed Motion for Sanctions (“Response”) (Doc. 233). By the Motion, Plaintiff requests that “the Court make an adverse inference that the lost emails support Scrap King's claim that it was willfully sold treated regulated medical waste, not ‘used healthcare products’, by Stericycle, in disregard of its rights and the safety of Scrap King employees and the public at large, all in violation of applicable law and in breach of the terms of its contract” and that the Court award Plaintiff “all the fees and costs it has incurred in prosecuting and defending this case without the benefit of the emails and other documents either produced after the discovery cut-off date or forever lost” (Doc. 226, at 30). The Court conducted multiple hearings on the matter (Docs. 250, 266, 272). Upon due consideration and for the reasons that follow, Plaintiff's Motion is due to be denied.

I. Procedural and Factual History

On October 1, 2013, Plaintiff and Defendant “entered into a Contractor Agreement for Recyclable Material Collection Services” (“Contract”) whereby Defendant agreed to provide Plaintiff with “Recyclable Material,” which, by definition, specifically excluded “Regulated Medical Waste and Hazardous Waste” (Doc. 40, at 2; Doc. 83-10, at 12-25). On March 7, 2018, Plaintiff filed the instant case in the Circuit Court of the Thirteenth Judicial Circuit in and for Hillsborough County, Florida (see Doc. 1). Defendant then removed to this court (Doc. 1).

Plaintiff alleges that Defendant “breached the terms of the Contract by ... a. Providing ‘Regulated Medical Waste’ to [Plaintiff]; b. Providing other ‘Non-Conforming Waste’ to [Plaintiff]; c. Failing to use ‘reasonable commercial efforts’ to assure that the loads picked up by [Plaintiff] did not contain ‘Biomedical waste’ or other ‘Non-Conforming Waste’ as defined by the Contract” (Doc. 40, at 2). Plaintiff's Second Amended Complaint asserts a breach of contract claim (Count I), a fraud in the inducement claim (Count II), and a negligence claim (Count (III) (Doc. 40). “The essence of all three claims is that, in violation of Florida state law and the contract, [Defendant] sold treated biomedical waste to [Plaintiff] which [Defendant] knew could only be transported by licensed waste transporters and could only be disposed of in a Class 1 landfill or an incinerator. In other words, [Defendant] knowingly sold treated biomedical waste that could never be recycled without first obtaining a variance” (Doc. 41, at 3). Amongst other defenses, Defendant asserts that it did not sell treated biomedical waste to Plaintiff, rather that it only primarily provided Plaintiff with recyclable materials it received from a third party named Stryker (Doc. 41, at 3) (citation omitted).

*2 Plaintiff issued specific discovery requests in its First Request for Production to explore Defendant's position related to Stryker, amongst other assertions (Doc. 41, at 4). Plaintiff specifically sought all internal communications of Defendant relating to the contract (Request No. 2), all internal communications relating to the material Defendant provided or was to provide Plaintiff under the terms of the contract (Request No. 4), and all manifests relating to materials provided to Plaintiff by Defendant (Request No. 48) (Doc. 41-2, at 2-3, 24). Upon review of the production in response to the First Request for Production, Plaintiff believed that Defendant had not produced any responsive documents to Requests Numbers 2, 4, and 48, and thus, sent a “Good Faith Letter” to Defendant to address the perceived deficiencies (Doc. 41-3). Defendant responded to the “Good Faith Letter” by stating as to Request Numbers 2 and 4, Defendant “has searched and there are no non-privileged documents that are responsive to the request” and as to Request Number 48, Defendant “has provided all available information related to pick ups by Plaintiff of recyclable materials” (Doc. 41-4, at 1, 4). In a follow-up letter, Defendant also asserted as to Request Number 48 that “[a]ll available documents responsive to this request have been previously produced” (Doc. 41-6, at 2).

Plaintiff eventually filed a Motion to Compel Production of Documents, which specifically sought the production of emails responsive to Request Numbers 2 and 4, as well as manifests in response to Request Number 48 (Doc. 41). In the Motion to Compel production of Documents, Plaintiff also made its initial request for Rule 37(e) sanctions (Doc. 41). Defendant responded by essentially asserting that as to Request Numbers 2, 4, and 48, all responsive documents in the possession of Defendant have been produced (Doc. 48, at 6, 11). Significantly, Defendant also asserted, for the first time, that no other responsive emails were available because of Defendant's six-month email retention policy, which had been in place years prior to the contract between Plaintiff and Defendant (Doc. 48, at 5). The Court conducted a hearing on Plaintiff's Motion to Compel Production of Documents (Doc. 41) and during the hearing counsel responded to the undersigned's question regarding whether Defendant had any responsive manifests to produce by stating that “the information that we have is what has been produced ...” (Doc. 55, at 23). As to the emails, Defendant's attorney stated that “we conducted interviews with all of the parties that may have been involved in this, asked them if they had hard copies, asked them if they had emails saved anywhere, and what we have, Your Honor, we produced” (Doc. 55, at 26).

Upon the completion of the hearing, the undersigned stated on the record that:

(Doc. 55, at 46-49). Further, the undersigned also concluded on the record that it was appropriate to allow Plaintiff to obtain discovery on Defendant's retention policy but that any sanctions sought under Rule 37(e) were premature (Doc. 55, at 47). The undersigned's findings were memorialized in an Order which allowed Plaintiff to obtain discovery limited to Defendant's email and records (e.g., manifests) retention policies, directed Defendant to produce any responsive discovery as to the remaining discovery requested, and denied without prejudice Plaintiff's request for sanctions for spoliation of evidence (Doc. 54).

Subsequently, after some discovery was obtained by Plaintiff regarding Defendant's retention policies, Plaintiff issued a notice to take the video deposition of Amanda Metts, Defendant's Assistant General Counsel (Doc. 70-4). Soon after, Defendant filed an Emergency Motion for Protective Order requesting that Plaintiff be prohibited from deposing Ms. Metts (Doc. 70). The Court conducted a hearing on Defendant's Emergency Motion for Protective Order and concluded that Ms. Metts did not have to be produced for deposition, unless designated by Defendant as a Rule 30(b)(6) witness (Doc. 92, at 58-59). However, during the hearing, the undersigned noted that:

(Doc. 92, at 36). Essentially, the Court expressed skepticism during the hearing about whether Defendant had produced a sufficient Rule 30(b)(6) witness regarding Defendant's retention policies and whether questions about Defendant's retention policy had been appropriately answered (Doc. 92, at 31-36). Notably, during the hearing, the undersigned questioned Defendant's position about the retention of the relevant manifests and Defendant's attorney responded that Defendant did not have the manifests but Defendant's attorney was unable to provide any specifics as to the retention policy of the manifests (Doc. 92, at 43-44). It was also made clear that Defendant instituted a litigation hold on March 22, 2018 (Doc. 92, at 51). Ultimately, the Court ordered that the deposition of Ms. Metts not go forward unless further directed by the Court, but that Plaintiff could conduct an additional Rule 30(b)(6) deposition related to topics agreed upon by the parties (Doc. 88).

After additional disputes regarding the outstanding discovery (see Docs. 89, 90, 95, 99), Plaintiff filed an Expedited Motion for Sanctions Pursuant to Rule 37(b) seeking sanctions for Defendant's failure to preserve and produce relevant email communications (Doc. 117). Additionally, Plaintiff filed a Motion for Sanctions Pursuant to Federal Rule of Civil Procedure 37(e)(2) seeking sanctions for Defendant's failure to preserve and produce relevant manifests (Doc. 131). The Court conducted a telephonic status hearing on Plaintiff's sanction motions on January 3, 2020 (see Doc. 141). Significantly, it was developed during the status hearing that there were seven custodians whose email accounts Defendant preserved based upon litigation holds not related to this case (Doc. 141, at 21-26). However, the record was unclear whether Defendant searched any of the seven custodians’ email accounts in response to Plaintiff's discovery requests (Doc. 141, at 26). Equally significant, it was revealed that the requested manifests were in the possession of a non-party vendor, HOV, who maintained the manifests for Defendant (Doc. 141, at 6-11).[2] However, Defendant could not explain why the manifests should not be deemed to be in the possession, custody, and control of Defendant (Doc. 141, at 9-10). Rather, Defendant acknowledged that it did have the ability to request the manifests from HOV (Doc. 141, at 10). The Court concluded the status hearing by identifying outstanding issues for the parties to be prepared to argue and scheduled the matter for oral argument[3] (Doc. 141, at 21-22).

On January 16, 2020, the parties appeared before the Court to continue their arguments on Plaintiff's sanction motions (Docs. 117 & 131) and to address the Court's outstanding questions from the January 3, 2020 telephonic status hearing (see Doc. 158). Upon the conclusion of the January 16, 2020 hearing, the Court made the following findings related to manifests:

(Doc. 158, at 102-04). Specifically, the Court awarded monetary sanctions to Plaintiff pursuant to Rules 26(g) and 37(b) in the form of fees and costs associated with matters related to Plaintiff's pursuit of the manifests after the Court ordered that the manifests be produced. The Court took under advisement the amount of fees to be awarded (Doc. 158, at 104).

As to issues pertaining to the email communications, Defendant indicated that it had conducted further inquiry regarding the seven custodians discussed at the January 3, 2020 hearing, and it discovered additional PST files to be produced (Doc. 158, at 92). Given the additional production of email communications, Plaintiff alternatively requested that a neutral forensic examination of Defendant's email server be conducted (Doc. 158, at 97). Upon consideration of Plaintiff's request, the Court made the following findings:

(Doc. 158, at 105-07). Ultimately, the Court awarded Plaintiff monetary sanctions pursuant; took under advisement the amount of the award; and appointed an expert to conduct an independent examination of Defendant's email server (Doc. 147). Numerous disputes followed regarding the nature of the independent examination and the privilege assertions on various emails located by the expert (see Docs. 157, 167, 178, 182, 188, 195, 203, 215, 223). Upon the conclusion of the expert's independent examination, an additional 311 non-privileged, responsive emails were produced (Doc. 226, at 10).

Given the production of the additional 311 emails, Plaintiff filed the instant Motion (Doc. 226) requesting that Defendant be sanctioned pursuant to Rule 37(e) and requesting that “the Court make an adverse inference that the lost emails support Scrap King's claim that it was willfully sold treated regulated medical waste, not ‘used healthcare products’, by Stericycle, in disregard of its rights and the safety of Scrap King employees and the public at large, all in violation of applicable law and in breach of the terms of its contract” (“adverse inference instruction”) (Doc. 226, at 30). The Court conducted hearings on the Motion on November 19, 2020 and on May 24, 2022 (Docs. 250, 272).

II. Discussion

Plaintiff requests the adverse inference instruction pursuant to Rule 37(e), the Court's inherent power, Rule 26(g), and Rule 37(c)(1) (Doc. 226, at 1). Specifically, Plaintiff argues that the adverse inference instruction is warranted under Rule 37(e) due to the spoliation of email communications (Doc. 226, at 22-26). Alternatively, Plaintiff asserts that pursuant to the Court's inherent power and Rules 26(g) and 37(c)(1), the adverse inference instruction is warranted given the alleged spoliation in conjunction with Defendant's abusive tactics during the discovery of the case (Doc. 226, at 29). As discussed below, Plaintiff's requested adverse inference instruction is an unwarranted sanction under Rule 37(e), the Court's inherent authority or under Rules 26(g) and 37(c)(1).

A. Rule 37(e)

*6 “Spoliation is the destruction or significant alteration of evidence, or the failure to preserve property for another's use as evidence in pending or reasonably foreseeable litigation.” Graff v. Baja Marine Corp., 310 F. App'x 298, 301 (11th Cir. 2009) (quoting West v. Goodyear Tire & Rubber Co., 167 F.3d 776, 779 (2d Cir. 1999)). “A district court possesses broad discretion in deciding whether to impose sanctions for the spoliation of evidence.” Romero v. Regions Fin. Corp./Regions Bank, 2019 WL 2866498, at *3 (S.D. Fla. July 3, 2019) (citing Flury v. Daimler Chrysler Corp., 427 F.3d 939, 944 (11th Cir. 2005)).

Rule 37(e), as amended in 2015, is the primary source to address the spoliation of relevant electronically stored information (“ESI”) that a party was required to preserve but lost due to its failure to take reasonable steps to preserve the ESI, resulting in prejudice to the opposing party. The case law on the application of the 2015 amendment is still developing and the Eleventh Circuit has not yet provided clear guidance as to the standards applicable under the Rule. See ML Healthcare Servs., LLC v. Publix Super Markets, Inc., 881 F.3d 1293, 1308 (11th Cir. 2018) (declining to establish factors courts must consider when parties seek sanctions under amended Rule 37(e) based on the spoliation of ESI and declining to determine whether bad faith is synonymous or distinguishable from acting with an intent to deprive). Notably, prior to the 2015 amendment of Rule 37, the Eleventh Circuit made clear that the severe sanction of an adverse inference are only proper when the absence of the evidence is due to bad faith on the part of the alleged spoliator. See id. at 1308 (citing S.E.C. v. Goble, 682 F.3d 934, 947 (11th Cir. 2012) (holding adverse inference instruction only proper “when the absence of [the] evidence is predicated on bad faith.” (citations omitted))).

Rule 37(e) specifically provides that:

Fed. R. Civ. P. 37(e).

Rule 37(e) has five threshold requirements: (1) the information at issue must be ESI; (2) there must have been anticipated or actual litigation that triggered a duty to preserve ESI; (3) relevant ESI was lost or destroyed; (4) the relevant ESI was lost or destroyed because a party failed to take reasonable steps to preserve it; and (5) the ESI cannot be restored or recovered through additional discovery. See id.; see also Sosa v. Carnival Corp., 2018 WL 6335178, at *10 (S.D. Fla. Dec. 4, 2018) (citation omitted), reconsideration denied, 2019 WL 330865 (S.D. Fla. Jan. 25, 2019). If all of these requirements are not met, “a motion for spoliation sanctions or curative measures must be denied.” Sosa, 2018 WL 6335178, at *10 (quotation and citation omitted). Even if all of the threshold requirements are satisfied, a court may only award sanctions under subsection (e)(1) if it finds “prejudice” to another party, or under subsection (e)(2) if it finds that the party acted with the “intent to deprive” the opposing party of the ESI. Fed. R. Civ. P. 37(e); see also, Title Capital Mgmt., LLC v. Progress Residential, LLC, 2017 WL 5953428, at *3 (S.D. Fla. Sept. 29, 2017) (citation omitted).

*7 Here, Plaintiff is seeking only an (e)(2) sanction in the form of the requested adverse inference instruction. Plaintiff argues that Defendant should be sanctioned because it “failed to timely impose a litigation hold” and because it “engaged in a pattern of discovery abuses, committed in bad faith” (Doc. 226, at 1). The essence of Plaintiff's argument is that the adverse inference instruction is warranted because Defendant failed to cease its routine six-month email retention policy on at least eight occasions before Defendant implemented the litigation hold on March 22, 2018, and that Defendant's bad faith/intent is evinced by its abusive discovery practices during the pendency of this matter. In turn, Defendant argues that the timing of Defendant's litigation hold does not give rise to sanctions and that regardless of the timing, Plaintiff's purported earlier trigger dates for the litigation hold would not have captured any relevant ESI from relevant custodians (Doc. 233, at 14-17). Defendant further argues that “[r]ather than meeting its burden of proving intentional destruction of evidence in bad faith by [Defendant] and resulting prejudice, [Plaintiff] strings together a list of red herrings” as a “transparent attempt at avoiding its burden of proving its weak case on the merits” (Doc. 233, at 4).

Given the issues as framed by the parties, the Court must first address the question of when Defendants owed a duty to preserve relevant email communications. In other words, as Plaintiff contends, was Defendant's obligation to preserve triggered prior to March 22, 2018? “Determining if a duty to preserve has been triggered is fact-specific and not amenable to a one-size-fits-all or checklist approach. Instead, a number of factors should be considered, including the level of knowledge within the organization about the claim and the risk to the organization posed by the claim.” The Sedona Conference, The Sedona Conference Commentary on Legal Holds, Second Edition: The Trigger & the Process A Project of the Sedona Conference Working Group on Electronic Document Retention and Production (WG1), 20 Sedona Conf. J. 341, 354–55 (2019) (citations omitted) (“Sedona WG1 Paper”).

Significantly, the advisory committee's notes to the 2015 amendments clarify that Rule 37(e) “applies only if the lost information should have been preserved in the anticipation or conduct of litigation and the party failed to take reasonable steps to preserve it.” Fed. R. Civ. P. 37(e) advisory committee's note to 2015 amendment. “[A] court may need to decide whether and when a duty to preserve arose. Courts should consider the extent to which a party was on notice that litigation was likely and that the information would be relevant.” Id. (emphasis added). In the Eleventh Circuit, the test is whether litigation was “pending or reasonably foreseeable” when the spoliation occurred. Graff, 310 Fed. Appx. at 301 (citation omitted). “Rule 37(e) does not apply, therefore, when information or evidence is lost before a duty to preserve attaches.” Living Color Enterprises, Inc. v. New Era Aquaculture, Ltd., No. 14-CV-62216, 2016 WL 1105297, at *4 (S.D. Fla. Mar. 22, 2016). Notably, “Rule 37(e) is based on th[e] common-law duty; it does not attempt to create a new duty to preserve.” Fed. R. Civ. P. 37(e) advisory committee's note to 2015 amendment. Therefore, case law related to the duty to preserve prior to the 2015 Amendment to Rule 37(e) is still applicable.

Identifying the boundaries of the duty to preserve often involves two related inquiries: (1) the timing of when the duty to preserve arises, and (2) what evidence must be preserved. See Zubulake v. UBS Warburg LLC, 220 F.R.D. 212, 216 (S.D.N.Y. 2003). With respect to timing, the principles developed by The Sedona Conference illuminate the issue, providing that a “reasonable anticipation of litigation arises when an organization is on notice of a credible probability that it will become involved in litigation, seriously contemplates litigation, or when it takes specific actions to commence litigation.” Sedona WG1 Paper at 370. “Generally, an organization is considered to ‘know’ what its employees know—at least, what employees know on subjects within the scope of their duties.” Id. at 374. Notably, the “routine, good faith operation of an electronic information system [is] a relevant factor for the court to consider in evaluating whether a party failed to take reasonable steps to preserve lost information, although the prospect of litigation may call for reasonable steps to preserve information by intervening in that routine operation.” Fed. R. Civ. P. 37(e) advisory committee's note to 2015 amendment.

*8 Here, as the Court has previously concluded, Defendant implemented a neutral, detached six-month email retention policy that had been implemented years in advance of this matter[4] (Doc. 158, at 105-07). Plaintiff has presented no new evidence or argument to disturb that finding. As such, the triggering date of Defendant's duty to preserve is clearly significant given that absent a litigation hold or other exemptions, Defendant's emails were typically preserved for only 6 months.

It is undisputed that Defendant implemented a litigation hold on March 22, 2018 upon the inception of this case (Doc. 226, at 2; Doc. 233, at 6). Plaintiff asserts that at least seven prior dates should have triggered for Defendant an earlier anticipation of litigation (Doc. 226, at 2-4). Plaintiff first asserts that the duty to preserve should have been triggered on July 7, 2015 when “Stericycle received an email from Alex Gregory identifying that the Department of Environmental Protection had shut down his ability to recycle the treated regulated medical waste and demanded that the treated regulated medical waste be removed from the property” (Doc. 83-19; Doc. 226, at 2-3). However, it is clear to the Court that the July 7, 2015 email cannot be construed to have put Defendant on notice to anticipate litigation. The July 7, 2015 email in no way raises the possibility of any litigation and the true context of the email reveals that Mr. Gregory was seeking Defendant's aide in providing financing to purchase equipment necessary to recycle certain waste (Doc. 83-19) (stating “I would love to fly wherever needed as soon as possible to meet and discuss if there is an opportunity for Stericycle to help me finance this new endeavor”).

Plaintiff also contends that “a litigation hold should have been placed on January 8, 2016 upon receipt of a demand letter from Barry Cohen, Esq., counsel for Scrap King” (Doc. 226, at 3).[5] Significantly, the letter does not reference Scrap King, as a client or a potential litigant. Rather, the letter unquestionably stated that Mr. Cohen represented A&M Metals and its principals, Alex Gregory and Max Zalkin, which were collectively referenced as “A&M” (hereinafter “A&M”) (Doc. 83-10). Although the letter attached the Contract (see Doc. 83-10, at 12) between Plaintiff and Defendant, it is abundantly clear that all demands in the letter are made on behalf of A&M (Doc. 83-10, at 9) (stating under a section entitled “Demand” that “[m]y client [A&M] has refrained from filing any State or Federal action in the hopes that Stericycle and its Board of Directors, in enlightened self-interest will see the benefit of resolving this matter fully and fairly with my Client and before your shareholders and the public are exposed to the facts set forth herein and more”).

Plaintiff further asserts that a “litigation hold should have been placed on March 16, 2016 upon the receipt of a Warning Notice from the Environmental Protection Commission,” which referenced the unauthorized acceptance and accumulation of treated biomedical waste that had been transported and deposited by Stericycle in violation of Florida statutes and the Florida Administrative Code (Doc. 226, at 3). However, like Mr. Cohen's January 8 demand letter, the March 16, 2016 notice makes clear that any potential dispute is between A&M Metals and Defendant (Doc. 83-12) (stating that “[t]he disposition of treated biomedical waste by Stericycle, Inc., at the A&M Metals Processing facility has also been indicated by A&M Metal's legal counsel”).

*9 Additionally, Plaintiff contends that a “litigation hold should have been placed on April 8, 2016 upon receipt of a demand letter from Barry Cohen” (Doc. 226, at 3). However, like Mr. Cohen's prior communication, the April 8 letter makes clear that Mr. Cohen is representing A&M and all demands are made on behalf of A&M (Doc. 83-14, at 5) (stating that A&M has been irreparably damaged “for which no sum of money is sufficient to recompense”).

Next, Plaintiff argues that a “litigation hold should have been placed on August 26, 2016 when Barry Cohen demanded all relevant records be preserved” or “on September 26, 2016 when Defendant's legal counsel stated they would preserve all relevant documents in a letter [in response] to Barry Cohen” (Doc. 226, at 4). Again, like with the other communications raised by Plaintiff, it is obvious that the context of the August 26, 2016 demand letter, and the September 26, 2016 response letter are in contemplation of a dispute between A&M and Defendant (Docs. 83-15 & 83-16). The August 26, 2016 demand letter demands the preservation of records, but it specifically states that “[t]hese conditions are necessary to preserve evidence that will be needed to preserve and prosecute A&M's claims against Stericycle” (Doc. 83-16, at 1). Further, the September 26, 2016 response letter is entitled as “A&M Metals – FOR SETTLEMENT PURPOSES ONLY” and specifically notes that in contemplation of a settlement, “Stericycle will agree to collect, transport, and dispose of the materials that [A&M] collected from Stericycle in consideration for a complete and mutual release” (Doc. 83-15) (noting that Stericycle cannot agree that “Stericycle's removal of the recyclable materials” ... “does not prejudice A&M Metal's purported claims against Stericycle”).

Significantly, none of the communications identified by Plaintiff could be reasonably construed to indicate that they were made on behalf of Scrap King. At no point in any of the communications is Scrap King referenced as having a potential claim against Defendant. Rather, all of the communications make clear that the claims that were being asserted by Mr. Cohen were on behalf of his clients, A&M Metals, Mr. Gregory, and Mr. Zalkin, collectively identified as A&M.

Last, Plaintiff asserts that a “litigation hold should have been placed on January 9, 2017 upon the filing of the lawsuit by A&M against Stericycle” (Doc. 226, at 4). The Complaint relied upon by Plaintiff plainly identifies that the lawsuit was filed by A&M Metals Processing, LLC, as the sole plaintiff against Stericycle, as the sole Defendant (Doc. 83-17). Although the Contract between Plaintiff and Defendant was attached as an exhibit to the Complaint (Doc. 83-17, at 7), Scrap King was not identified in the allegations of the Complaint as a party to the lawsuit (Doc. 83-17). Thus, like with the communications asserted by Plaintiff, the underlying lawsuit focused solely on A&M's claims.

Contrary to Plaintiff's arguments, none of the prior communications ever indicated that Scrap King may assert claims against Stericycle. Rather, the communications made by counsel were abundantly clear that all claims were being asserted by A&M. Mr. Cohen's demand letters’ state unequivocally that he was asserting the rights of A&M and that if Defendant did not capitulate to A&M's demands, then he would pursue appropriate steps to protect A&M's interest (Doc. 83-10, at 10) (demanding that Defendant “[p]ublish an apology to A&M Metals ... in the New York Times” and “[p]ay the sum of $15,000,000 to [A&M] within twenty (20) days ...”). The design and intent of counsel's demand letters was definitively confirmed when counsel filed suit on behalf of A&M Metals Processing, LLC against Stericycle on January 9, 2017 (Doc. 83-17).

*10 Given this record, it is difficult to make a clear finding about whether Defendant's duty to preserve ESI in connection with the instant litigation with Scrap King was triggered on some date prior to March 22, 2018, given that all the prior communications and the initial lawsuit focused solely on A&M. The failure of A&M's counsel to properly identify Scrap King, as a party in interest or as a related entity to A&M, clouds whether Defendant was privy to sufficient information that would have put it on notice of an anticipation of litigation with Scrap King during any of the other relevant time periods: July 7, 2015, January 8, 2015, January 8, 2015, March 16, 2016, April 8, 2016, August 26, 2016, September 26, 2016, and January 9, 2017.

As stated above, reasonable anticipation of litigation arises when an organization is on notice of a credible probability that it will become involved in litigation, and an organization is considered to know what its employees know within the scope of their duties. In that regard, Plaintiff makes a tepid argument asserting that because Defendant “filed a Motion to Dismiss the complaint, successfully arguing that Scrap King, not A&M, was the proper party in [the originally filed] suit,” then Defendant should have known that Scrap King and A&M were related entities, and as such, any duty to preserve triggered by A&M's communications should have also triggered a duty to preserve as to Scrap King (Doc. 226, at n. 1).[6] However, Plaintiff's argument is lacking because Plaintiff failed to produce sufficient evidence to demonstrate that during any of the alleged relevant time periods Defendant had ample knowledge of facts connecting A&M and Scrap King as related entities. Whether Defendant had sufficient notice to anticipate litigation with Scrap King is a fact intensive inquiry, and the relevant inquiry is whether Defendant had sufficient knowledge to know a connection between Scrap King and A&M, such that the threat of litigation by A&M could also equate the threat of litigation by Scrap King. Just because Defendant may have had a duty to preserve as to A&M does not necessarily equate a duty to preserve as to Scrap King. See e.g., Oracle Am., Inc. v. Hewlett Packard Enter. Co., 328 F.R.D. 543, 551 (N.D. Cal. 2018) (finding that there was no duty to preserve based upon a duty to preserve in separate litigation). Thus, the inadvertent misidentification of A&M instead of Scrap King to Defendant alone casts doubt upon Plaintiff's request for an adverse inference instruction.

*11 Regardless of whether Plaintiff could establish that Defendant should have known that A&M and Scrap King were related entities, thus potentially triggering a duty to preserve as to Scrap King, Defendant's six-month email retention policy also casts doubt about the merit of Plaintiff's requested adverse inference instruction because the policy calls into question whether there would have been any relevant evidence available to preserve. As noted above, Plaintiff asserts three claims: breach of contract (Count I), fraud in the inducement (Count II), and negligence (Count (III) (Doc. 40).[7] The specific discovery requests at the core of the issues currently before the Court are Plaintiff's request for all internal communications of Defendant relating to the contract (Request No. 2), and all internal communications relating to the material Defendant provided or was to provide Plaintiff under the terms of the Contract (Request No. 4). Given that the Contract was executed on October 1, 2013, it is reasonable to expect that the vast majority of communications relevant to the formation of the Contract and responsive to Plaintiff's discovery requests would have occurred sometime in 2013 and 2014. Thus, even if the Court were to liberally construe July 7, 2015[8] as a trigger for Defendant's duty to preserve relevant ESI, given Defendant's six-month email retention policy, it is highly unlikely that there would have been a trove of communications of significant evidentiary value left to preserve going back six months earlier to January 2015. Notably, Plaintiff failed to articulate the nature of any irreplaceable relevant communications that would have been lost upon its alleged timely preservation trigger, post January 2015. See Oracle Am., Inc., 328 F.R.D. at 553 (noting that the moving party failed to show that specific documents were missing because of the difficulties caused by their deletion). In other words, Plaintiff failed to even generally identify the type of email communications that should have been preserved post January 2015 and that would have been relevant to the alleged breach of contract, fraud in the inducement or negligence.

Based upon the emails recovered during the forensic evaluation, it appears that almost all email communications prior to January 2015 would have been lost by Defendant's six-month email retention policy, and that any communications after January 2015 would likely have been of de minimis evidentiary value. As noted above, an additional 311 emails were produced from the forensic evaluation (Doc. 226, at ¶ 37). A portion of the additional emails produced were emails that were generated after January 2015 (see Docs. 234 & 242).[9] Significantly, the majority of those post-January 2015 emails were either privileged emails or emails that focused predominately upon a clean-up of the A&M site and had little relevancy to the formation of the Contract between Scrap King and Stericycle (see Docs. 234 & 242). Thus, Plaintiff's request for an adverse inference instruction appears heavy-handed given that it is difficult to glean any actual prejudice from Defendant's perceived failure to initiate a preservation of all relevant email communications dating back to January 2015.

Ultimately, however, Plaintiff's request for an adverse inference instruction must fail because there is insufficient evidence to establish that Defendant acted with bad faith or intent to deprive Plaintiff of any relevant ESI. As noted above, it is unclear whether the Eleventh Circuit considers bad faith synonymous with an intent to deprive. See ML Healthcare Servs., LLC, 881 F.3d at 1308. Regardless, on this record, the Court finds that Defendant neither acted in bad faith nor with an intent to deprive. Rather, it is undisputed that Defendant had in place a neutral-detached six-month email retention policy dating back to 2010. Significantly, numerous pre-January 2015 emails were discovered and produced after the forensic evaluation of Defendant's email servers (see e.g., Docs. 234 & 242). The record is silent as to why these emails were preserved by Defendant. However, regardless of why these emails were preserved, the existence of the emails is significant to the Court's findings. The fact that these emails were preserved is contrary to Plaintiff's assertion that Defendant acted nefariously with an intent to seek out and destroy any relevant email communications in this case.

*12 Rather than present evidence that Defendant took affirmative steps to deprive Plaintiff of relevant ESI, Plaintiff focuses primarily on the acts of Defendant during the course of discovery. The essence of Plaintiff's argument is that Defendant acted in bad faith as demonstrated by Defendant's conduct in the course of discovery in this case, i.e., Defendant's failure to timely produce the manifests and emails (Doc. 226, at 18-26). Without question, Defendant woefully failed to meet its discovery obligations by failing to timely produce the manifests and email communications. Although such bad conduct during the course of discovery is sanctionable, the Court is unpersuaded to find that such conduct alone should equate a bad faith or intent to deprive finding. Rather, this Court has already ordered Defendant's conduct sanctionable under Rules 26(g) and 37(b) (see Doc. 158) and will award Plaintiff a monetary award as an appropriate sanction for such conduct.[10]

Despite Defendant's discovery failures, the Court finds on this record that there is no evidence to demonstrate that Defendant or any individuals within Defendant's organization undertook any efforts to identify relevant email communications so that they could be deprived from Plaintiff. To the contrary, the Court is satisfied that Defendant acted in concert with its six-month email retention policy, and that if any possible relevant communications may have been destroyed, they were done so by a negligent act, and certainly not with bad faith or an intent to deprive. As such, Plaintiff's request for an adverse inference instruction is unwarranted.

Thus, upon this record, the Court questions whether Plaintiff's requested adverse inference instruction would be appropriate given A&M's counsel's inadvertent failure to properly identify Scrap King for preservation purposes or given that even if such preservation would have been initiated by Defendant earlier, such preservation would have resulted in no more than de minimis email communication of evidentiary value to Plaintiff's claims. Ultimately, however, the Court finds that Plaintiff's requested adverse inference instruction is misplaced because the Court is satisfied that Defendant did not act in bad faith or with an intent to deprive.[11] Notably, Plaintiff seeks relief not only pursuant to Rule 37(e), but also pursuant to the Court's inherent authority, as well as Rules 26(g) and 37(c)(1).[12] Regardless of the applicability of the Court's inherent authority, or Rules 26(g) and 37(c)(1), the Court's finding remains intact, in that Plaintiff's requested adverse inference instruction is unfounded given that Defendant did not act in bad faith or with an intent to deprive.

*13 Accordingly, Plaintiff's Renewed Motion for Sanctions Pursuant to Rule 37(e), Federal Rules of Civil Procedure and the Inherent Authority of the Court (Doc. 226) is DENIED.

DONE AND ORDERED in Tampa, Florida, on this 20th day of December, 2022.

The Motion was referred by United States District Judge Mary S. Scriven to the undersigned “for entry of an Order or Report and Recommendation, as appropriate” (Doc. 243).

Defendant first informed Plaintiff that HOV was a vendor that maintained manifests for Defendant on June 10, 2019, in an answer to an interrogatory (Doc. 134, at 4).

Plaintiff only requested oral argument and did not request an evidentiary hearing (Doc. 141, at 4-5).

Defendant's Record Retention Policy regarding emails goes back to as early as December 2010 (Doc. 83-9).

The date of Mr. Cohen's initial demand letter is unclear to the Court. Plaintiff's Motion lists and argues the date as January 8, 2016 (Doc. 226, at 3). However, the date listed on Mr. Cohen's demand letter submitted as Doc. 83-10 is January 8, 2015. Regardless, the correct date of Mr. Cohen's initial demand letter has no bearing on the Court's ultimate finding that the requested adverse inference instruction is unwarranted because Defendant did not act in bad faith or with an intent to deprive.

Plaintiff also appears to argue that because Defendant owed a duty to preserve ESI to the government for its potential investigation, then such a duty should have inured to the benefit of Plaintiff. However, Plaintiff fails to cite to any binding or persuasive authority to support this argument. To the contrary, numerous courts in the Eleventh Circuit have addressed a similar “shifting duty” argument, and all have uniformly rejected such an argument. See In re Disposable Contact Lens Antitrust, 329 F.R.D. 336, 432 (M.D. Fla. 2018) (citing In re Delta/AirTran Baggage Fee Antitrust Litig., 770 F. Supp. 2d 1299, 1308 (N.D. Ga. 2011) (rejecting the shifting duty argument and stating that “Plaintiffs have not cited any authority that would support such a sweeping and novel theory of spoliation”)); In re Abilify (Aripiprazole) Prod. Liab. Litig., No. 3:16-MD-2734, 2018 WL 4856767, at *5 (N.D. Fla. Oct. 5, 2018) (concluding that Plaintiffs’ argument is without merit “given that other courts addressing the same shifting duty argument have rejected it”); Stanfill v. Talton, 851 F. Supp. 2d 1346, 1366 (M.D. Ga. 2012) (stating that “[t]he Court is not aware of any decision by a court in this circuit adopting the ‘shifting duty’ argument urged by the Plaintiff, and on the facts here, this Court declines the opportunity to be the first” (citations omitted)); Point Blank Sols., Inc. v. Toyobo Am., Inc., No. 09-61166-CIV, 2011 WL 1456029, at *24 (S.D. Fla. Apr. 5, 2011) (stating that “[t]he shifting duty theory is incompatible with the basic rule that a duty is owed to a specific party”).

It should be noted that during a May 24, 2022 hearing, the undersigned questioned the viability of Plaintiff's tort claims in Counts II and III based upon the independent tort doctrine as discussed in Lookout Mountain Wild Animal Park, Inc. v. Stearns Zoological Rescue & Rehab Ctr., Inc., 553 F. App'x 864, 865 (11th Cir. 2014); Kaye v. Ingenio, Filiale De Loto-Quebec, Inc., No. 13-61687-CIV, 2014 WL 2215770, at *4 (S.D.Fla. May 29, 2014); Freeman v. Sharpe Res. Corp., No. 6:12-CV-1584-ORL-22T, 2013 WL 2151723, at *8 (M.D.Fla. May 16, 2013)). However, the undersigned agrees with Plaintiff in that the Court should not consider the viability of Counts II and III to determine the instant Motion, since Counts II and III are still claims of record and Defendant has not moved to challenge those claims.

As noted above, Plaintiff's alleged date of July 7, 2015 could not plausibly be considered a trigger for Defendant's duty to preserve given that the essence of the email communication was to seek funding from Defendant and not to assert the possibility of litigation.

The most significant emails produced were those pre-dating July 2015, as demonstrated by Plaintiff's arguments focused upon the prejudice resulting from the late production of an August 23, 2013 email (see Doc. 226, at ¶ 45).

The Court will set a hearing by separate notice to address the outstanding issues briefed by the parties related to Plaintiff's requested fee award (see e.g., Docs. 276 & 279).

The Court recognizes that the record could have potentially been further developed to establish that Defendant knew Scrap King and A&M were related entities, as well as to establish that Plaintiff was actually prejudiced by the deprivation of post-January 2015 emails, but such endeavors would have been futile given the Court's ultimate finding that Defendant did not act in bad faith or with an intent to deprive.

It is unclear whether the Court could exercise its inherent authority under these circumstances given that Rule 37(e) “authorizes and specifies measures a court may employ if information that should have been preserved is lost, and specifies the findings necessary to justify these measures. It therefore forecloses reliance on inherent authority or state law to determine when certain measures should be used.” Fed. R. Civ. P. 37(e), advisory committee notes to 2015 amendment. “[M]any courts have held that Rule 37(e) ... provide[s] the exclusive mechanism by which [the court] must analyze spoliation allegations involving ESI.” Romero, 2019 WL 2866498 at *4 (collecting cases). However, despite the expressed statements in the advisory committee notes to 2015 amendment of Rule 37(e) debate still exists as to whether courts should foreclose reliance upon inherent authority to address ESI spoliation issues. See Thomas Y. Allman, Dealing with Prejudice: How Amended Rule 37(e) Has Refocused ESI Spoliation Measures, 26 Rich. J.L. & Tech. 1, 19 (2020) (stating that the “Amended Rule does not bar use of inherent authority in those situations where a party is not clearly subject to Rule 37(e)”); see also, DR Distributors, LLC, v. 21 Century Smoking, Inc., 513 F. Supp. 3d 839, 948-961 (N.D.Ill. 2021) (detailing the various sanctions under the Rules and the applicable standards).