Epic Systems Corp. v. Tata Consultancy Services

What happened

Epic Systems brought a trade-secret misappropriation claim against Tata Consultancy Services (TCS), alleging TCS's employees had downloaded hundreds of thousands of Epic's proprietary documents. Once litigation commenced, Epic obtained a preservation injunction requiring TCS to maintain all potentially relevant records. TCS nevertheless continued operating a 90-day automatic email deletion programme. The deletion of emails subject to a court-ordered preservation hold was treated by the district court as wilful spoliation of evidence, and an adverse-inference instruction was issued directing the jury to assume the deleted emails would have supported Epic's case. The jury returned a verdict of $940 million, later reduced to $140 million by the Seventh Circuit on a damages-methodology basis, with the adverse-inference instruction affirmed. The case is a stark illustration that centralised corporate email systems with automated deletion policies can silently destroy evidence that is subject to a legal hold, with severe consequences.