RealNetworks, Inc. v. DVD Copy Control Association: Preservation Triggers and Terminated Employees

On May 5, the U.S. District Court for the Northern District of California, in RealNetworks, Inc. v. DVD Copy Control Association, 2009 WL 1258970 (N.D. Cal. May 5, 2009), granted DVD Copy Control Association’s (DVD CCA’s) motion for sanctions for spoliation of evidence for RealNetworks’ failure to preserve notebooks containing potentially relevant information that had belonged to an employee who had been terminated right before RealNetworks’ action. This case is of interest because it discusses two key issues in discovery—when the obligation to preserve is triggered and how to preserve records created by employees who have separated from the company by the time the preservation obligation arises.

RealNetworks filed an action on September 30, 2008 seeking declaratory judgment that they had not breached a license agreement with DVD CCA. That same day in another jurisdiction, some of the DVD CCA defendants filed an action against RealNetworks alleging breach of the same licensing agreement. Later, DVD CCA filed a motion for sanctions against RealNetworks alleging spoliation of evidence.

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