Fire and Forget?: Federal Court Imposes Sanctions For Failure To Follow-Up After Issuing Legal Holds
The federal district court for the Northern District of Illinois has imposed monetary sanctions on Sinclair Broadcast Group Inc. for its employees’ failure to preserve text messages in an ongoing multidistrict antitrust litigation.
Judge Virginia M. Kendall, on November 19, 2025, ruled Sinclair “acted carelessly” when the company issued a litigation hold requiring employees to preserve relevant text messages, but failed to take additional steps to independently identify relevant data and ensure its employees’ compliance with the hold. Judge Kendall’s opinion raises questions about the reasonable actions a company must take to avoid sanctions when custodians or others fail to preserve potentially relevant electronically stored information (ESI) in litigation.
The Court’s Spoliation Decision:
Since 2018, Sinclair and other media companies have been defending a multidistrict antitrust litigation alleging a conspiracy to fix the price levels of broadcast television advertisements. The case, pending in federal court in the Northern District of Illinois,1 followed a U.S. Department of Justice price-fixing investigation in 2018 that led to settlements with Sinclair and other media companies. In December 2020, plaintiffs requested, among other things, that Sinclair produce relevant text messages on company-issued cell phones. While plaintiffs did not initially pursue the issue over Sinclair’s objections, in the spring of 2023, plaintiffs renewed their request for the text messages, which led to Sinclair disclosing (after its extensive investigation) that it had failed to preserve data from 55 of the 81 relevant company-issued cell phones.
In opposing plaintiffs’ subsequent motion for spoliation sanctions, Sinclair argued that it had promptly issued legal holds covering the subject matter of the MDL beginning in February 2018, when the DOJ first informed Sinclair that it was considering an investigation. In particular, Sinclair issued an initial legal hold on February 5, 2018, which was amended and updated on April 2, 2018—instructing recipients to preserve all relevant information, notify the company’s Director of Technical Operations prior to replacing or disposing of any mobile device, and certify the recipient had reviewed and would comply with the hold. The company also sent a reminder hold notice to the recipients on November 20, 2018, following the filing of the class action complaints in the MDL; and updated and reissued the hold in April 2021, following the MDL parties’ initial meet-and-confer process. In addition, Sinclair inquired of its 160 custodians whether their text messages were likely to contain relevant information, and none had volunteered information suggesting text messages were responsive.
The court rejected as inadequate Sinclair’s efforts to rely on these legal holds to preserve relevant information. The court noted that under the Federal Rules of Civil Procedure, sanctions for spoliation may issue where a party “fail[s] to take reasonable steps” to preserve information court held Sinclair had “failed to take reasonable steps” to preserve relevant ESI. The court found several facts relevant to this determination, including:
- Sinclair apparently had no standard system for tracking its employees’ company-issued mobile devices for much of the relevant time period, preventing the company from understanding whether custodians complied with the legal hold.
- The company did not use automatic data back-up options for its employees’ company-issued devices, which could have preserved text messages lost from physical damage to individual mobile devices.
- Sinclair did not independently assess its custodians’ compliance with the legal hold—such as by “identifying which custodians had potentially relevant data independently of the custodian’s own assessments” and “ensuring that these custodians (and the IT department upon the departure of these custodians) fully understood and fulfilled the obligation to preserve data.”
The court, while finding Sinclair’s preservation practices “disorganized, careless, and inadequate,” declined to impose severe sanctions, recognizing that Sinclair had worked with plaintiffs to attempt to remediate the issue, attempted (at significant cost) to recover data where possible, and kept plaintiffs informed and updated during the company’s investigation. Nonetheless, the court held that monetary sanctions were appropriate and ordered Sinclair “to make Plaintiffs whole for the costs of [Plaintiffs’ 19-month inquiry] into the text message issue.”
Implications For Legal Hold Processes:
The court’s sanctions order reinforces several important lessons for companies facing ESI preservation obligations. In particular:
- A Legal Hold, By Itself, May Not Insulate Against Spoliation: As the court’s opinion reiterates, issuing a legal hold “does not end counsel’s duty in preserving ESI.” Companies facing ESI preservation obligations need a multi-faceted, defensible approach, which may include interviews with key custodians, investigation of non-custodial data sources, and continued monitoring of custodians’ compliance with hold obligations.
- Off-Loading Preservation Duties to Employees Is a Significant Risk: Here, the court was especially concerned with Sinclair’s reliance on its employees to both (1) notify the company regarding the existence of potentially responsive ESI and (2) ensure their own compliance with preservation obligations. Companies should thus consider processes that include independent investigations of potentially relevant sources of information and independent confirmation of custodial compliance.
- Reasonable Preservation Includes Consideration of “Layered” Protection: The court found it unreasonable that Sinclair had failed to initiate a simple automatic back-up process for its company-issued mobile devices, a solution the court noted “would have preserved the ESI at little to no cost.” Companies are advised to consider the feasibility of technical alternatives to custodian self-preservation where those alternatives are reasonable and align with business purposes.
- Defensible ESI Preservation Includes Monitoring Measures: The court found it notable that Sinclair had no system in place to track which employees had company-issued mobile devices—meaning that when an employee handed in a device for upgrade or replacement, the company had to rely on the employee to notify the IT Department that information on the device should be preserved under legal hold. Companies are advised to consider processes to monitor employee device usage and ensure that data is not lost when an employee exchanges, upgrades, or relinquishes a device.
As ESI continues to proliferate, it may be tempting for a company to rely entirely on its own custodians to preserve and collect relevant information in litigation. The Northern District’s recent opinion, however, underscores that a defensible preservation process requires more than a “fire and forget” legal hold process.
For additional information on this topic, please reach out to Robert Keeling (rkeeling@redgravellp.com), Jonathan Redgrave (jredgrave@redgravellp.com), or Erica Zolner (ezolner@redgravellp.com).