IN RE NTL, INC. SECURITIES LITIGATION; GORDON PARTNERS, et al., Plaintiffs, -against- GEORGE S. BLUMENTHAL, et al., Defendants., 244 F.R.D. 179

Summary

The original complaint was filed against a debtor corporation before it filed for bankruptcy. As a result of the bankruptcy, the securities lawsuits were permitted to go forward against defendant corporation as the successor to the debtor corporation, and the non-party corporation retained the debtor corporation's operating telecommunications assets. Defendant corporation denied plaintiffs' document requests on the ground that all corporate documents relating to the pre-bankruptcy period were in the non-party corporation's possession. Agreements in which the non-party corporation stipulated that it would provide defendant corporation with access to records and information were not revealed to the court until late in the discovery process. Defendant corporation conceded that its duty to preserve evidence relevant to the litigation attached one month before the complaint was filed. The court held that spoliation sanctions were warranted because defendant corporation had the practical ...