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Pillay v. Millard Refrigerated Services, Inc.

United States District Court, Seventh Circuit

May 22, 2013

A. SAMSON PILLAY, Plaintiff,



A. Samson Pillay alleges that Millard Refrigerated Services ("Millard") is liable for retaliation under the Americans with Disabilities Act ("ADA"), 42 U.S.C. §§ 12102 et seq., for terminating Pillay's employment after Pillay opposed Millard's decision to terminate another employee, Anthony Ramirez, because of a perceived disability. Presently before the court is Pillay's motion for an adverse inference jury instruction based on Millard's failure to preserve evidence used to substantiate Ramirez's termination.[1] For the reasons stated below, Pillay's motion is granted.


Millard employed a labor management system ("LMS") to track its warehouse employees' productivity and performance. On July 28, 2008, Millard hired Ramirez as a regular employee and assigned him to a position operating a forklift. Millard initially told Ramirez that his LMS numbers were great and that he was performing satisfactorily. Shortly thereafter, the general manager of the Millard plant where Ramirez worked emailed Millard's senior vice president of human resources regarding a prior work injury that Ramirez suffered rendering him with a disability rating of 17.5 percent by the Illinois Industrial Commission. The senior vice president responded, writing, "We have this all documented right?... Let's get him out asap." Pillay's Mot. at 2. Millard terminated Ramirez's employment shortly thereafter on August 21, 2008. Millard contends that Ramirez's termination resulted from his unacceptable LMS performance rating of 59 percent.

Pillay argues that Millard terminated Ramirez because Millard believed that Ramirez was disabled, and its reliance on the LMS performance rating is pretext. Pillay contends that the underlying LMS data could have been manipulated to skew an overall performance rating. For example, Millard's 30(b)(6) witness, Allen Benjamin, testified that supervisors could lower an LMS performance rating by deleting the underlying data showing that an employee worked a certain number of jobs for a given period of time. A supervisor failing to input that an employee performed a task that took a given period of time could result in the employee's having a lower LMS performance rating. Pillay notes that Ramirez's underlying LMS numbers appear to have been manipulated, relying on the fact that Ramirez's LMS numbers for one week indicate that he only worked 104 hours when he would have been expected to work 160 hours.

In August 2009, the raw data used to create Ramirez's LMS numbers were deleted because the LMS software automatically deleted the underlying data after a year. Before the information was deleted, Pillay notes that he and Ramirez sent numerous pieces of correspondence alerting Millard of the need to preserve this evidence. Specifically, Pillay sent Millard a demand letter in September 2008 and both Pillay and Ramirez sent preservation notices in December of 2008 reminding Millard of its obligations to preserve evidence. Specifically, on December 10, 2008, John Ireland, Ramirez's and Pillay's counsel, sent Steven L. Offner, Millard's general counsel, a letter informing him, inter alia, that Millard was "to preserve evidence and documents" including electronic communications or data related to his clients' employment, specifically citing "[a]ll communications, documents, emails, or anything relating to Mr. Ramirez's productivity and work evaluations." Pillay's Mot., Ex. H. Pillay and Ramirez also filed charges with the United States Equal Employment Opportunity Commission ("EEOC") in January 2009 alleging discrimination and retaliation and, in response to the EEOC charges, Millard relied on Ramirez's deficient LMS rating to explain his termination. In July 2010, Millard notified Pillay that the data used to calculate Ramirez's LMS numbers had been deleted. Millard explained that "the discrete data [that formulates LMS numbers] is automatically deleted after one year" to keep its system operating at an optimal level. Pillay's Mot., Ex. F. Millard also attached a declaration from Sean Kimble, another senior vice president of human resources, who stated that Millard did not use the underlying data in making personnel decisions. Millard's Resp., Ex. A at §§ 3-4.


A party that knows or should know that litigation is imminent has a duty to preserve evidence in its control. See Trask-Morton v. Motel 6 Operating, L.P., 534 F.3d 672, 681 (7th Cir. 2008); Bryant v. Gardner, 587 F.Supp.2d 951, 967-68 (N.D. Ill. 2008). The judge may instruct the jury to infer that destroyed evidence was unfavorable when a party intentionally destroys that evidence in bad faith. See Faas v. Sears, Roebuck & Co., 532 F.3d 633, 644 (7th Cir. 2008). The proper focus is the reason for the destruction not that the evidence was destroyed. Id.


Pillay argues that Millard had a duty to preserve the underlying LMS data and its failure to do so evidenced bad faith, which warrants an adverse inference instruction. Millard argues that an adverse jury instruction for failure to preserve the overwritten data is unwarranted because Millard had no obligation to preserve the overwritten data and there is no evidence that it acted in bad faith by allowing the data to be deleted.[2]

I. Whether Millard Had a Duty to Preserve the Underlying LMS Data

Pillay first must demonstrate that Millard had a duty to preserve the underlying LMS data. A party has a duty to preserve evidence that is discoverable under Federal Rule of Civil Procedure 26. See YCB Int'l, Inc. v. UCF Trading Co., No. 09 C 7221, 2012 WL 3069683, at *6 (N.D. Ill. June 12, 2012). Rule 26's broad duty of disclosure provides that "[r]elevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence." Fed.R.Civ.P. 26(b)(1).

Here, Pillay notified Millard of his intention to file the present lawsuit well before the LMS data were automatically overwritten in August 2009. In September 2008 shortly after his termination, Pillay sent demand a letter placing Millard on notice of an impending lawsuit. Pillay and Ramirez also filed charges with the EEOC giving Millard another reason to believe that litigation was imminent. Indeed, Pillay and Ramirez sent Millard preservation notices in December 2008 approximately eight months before the deletion of the LMS data. Although Millard deleted the LMS numbers before Pillay and Ramirez filed this lawsuit, Pillay and Ramirez's pre-filing correspondence with Millard in addition to their filing EEOC charges gave the requisite notice of a possibility of litigation invoking Millard's preservation duty. See Buonauro v. City of Berwyn, No. 08 C 6687, 2011 WL 3754820, at *6 (N.D. Ill. Aug. 25, 2011) (duty to preserve arises not when a lawsuit is filed but when a party should anticipate litigation).

Although Millard contends that this information is not relevant, the inquiry is whether this information is the type that would have been discoverable under Rule 26. See Larson v. Bank One Corp., No. 00 C 2100, 2005 WL 4652509, at *11 (N.D. Ill. Aug. 18, 2005) ("[A] party cannot destroy documents based solely on its own version of the proper scope of its document retention responsibilities.") (internal quotation marks omitted). Millard used the underlying LMS data to calculate the overall percentage rating for an employee and argued that Ramirez's poor rating precipitated his termination. Indeed, Millard relied on this information when responding to the EEOC charges, which occurred before the deletion of the underlying LMS data. Information regarding the underlying LMS data would have been discoverable to challenge Millard's explanation for Ramirez's termination. See YCB Int'l, 2012 WL ...

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