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What’s a litigation hold?

On Behalf of | Aug 11, 2022 | Litigation Defense

Despite all the precautions you may have taken, it’s hard to avoid the specter of litigation when you own a business. Eventually, something is bound to happen that could open the door to a lawsuit.

That’s why you need to understand what a litigation hold is and how to use it to protect your company’s future.

Once there’s a triggering event, you have a duty to preserve evidence

The law requires plaintiffs and defendants in a case to handle any evidence (good or bad for their case) with care.

Whenever there’s a “triggering” event – whether that’s a data breach, a claim that you’ve broken a contract with another company or a customer complaint about a defective product – your company has an obligation to keep any relevant evidence from being altered or destroyed.

If you don’t act quickly, you could be at a serious disadvantage

If you fail to preserve things properly and the case does move to litigation, your mistake can be construed as deliberate spoliation of the evidence that’s needed. In situations like that, you can be sanctioned or fined – and the judge or jury may be permitted to assume that the evidence (had it been preserved) would have been detrimental to your side.

A litigation hold is a proactive measure that helps protect you

Also called a “preservation order” or a “hold order,” a litigation hold should be issued from the top down. Start by identifying what evidence (including electronic data) may need to be preserved and make sure that everybody who has control of that evidence is notified.

In addition, take additional steps to preserve evidence as needed. That may include:

  • Isolating physical evidence and digital devices
  • Copying the original data for examination
  • Keeping a record whenever any evidence changes hands

Whatever your situation, the threat of a business lawsuit can loom large in your mind. When that happens, make sure that you obtain experienced legal guidance right away.