Case3:07-cv SI Document78 Filed08/01/11 Page1 of 29

Transcription

1 Case:0-cv-00-SI Document Filed0/0/ Page of 0 RICHARD A. JONES (Bar No. ) rjones@cov.com COVINGTON & BURLING LLP Front Street San Francisco, CA Telephone: () -000 Facsimile: () -0 THOMAS S. WILLIAMSON, JR. (Pro hac vice) twilliamson@cov.com SHIMICA D. GASKINS (Pro hac vice) sgaskins@cov.com COVINGTON & BURLING LLP Pennsylvania Ave., N.W. Washington, DC 00 Telephone: () -000 Facsimile: () - Attorneys for Defendant GILEAD SCIENCES, INC. DAVID MOORE, UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION Plaintiff, v. GILEAD SCIENCES, INC., Defendant. DEFENDANT'S NOTICE OF MOTION AND MOTION FOR SANCTIONS; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT Judge: Honorable Susan Y. Illston Date: September, Time: :00 a.m.

2 Case:0-cv-00-SI Document Filed0/0/ Page of 0 TABLE OF CONTENTS Page(s) NOTICE OF MOTION AND STATEMENT OF RELIEF SOUGHT... MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT S MOTION FOR SANCTIONS BASED ON PLAINTIFF S SPOLIATION OF EVIDENCE... INTRODUCTION AND STATEMENT OF ISSUES TO BE DECIDED... FACTUAL BACKGROUND... A. Moore Wiped His Gilead Computer at Least Six Times in 0 Despite Contemplating Litigation and Taking Steps to File a Qui Tam Complaint Against Gilead... B. Moore Performed a Complete Wipe of His Gilead Computer in 0... C. Forensic Analysis Documented Specific Instances of Moore s Destruction of Evidence... D. Moore Provided Materially Incomplete Interrogatory Responses Regarding His Wiped Hard Drives and Attempted to Give False Testimony at His Deposition... LEGAL ARGUMENT... 0 I. Moore Repeatedly Engaged in Willful Destruction of Evidence... 0 A. Moore destroyed relevant documents even though he had a duty to preserve those documents... B. Moore destroyed evidence with a culpable state of mind... II. Dismissal Is the Appropriate Sanction for Moore s Egregious Spoliation... III. A. Moore willfully destroyed relevant evidence resulting in prejudice to Gilead... B. There Is No Less Drastic Sanction Available Here... Monetary Sanctions Are Warranted Because Moore Has Wrongfully Destroyed Evidence... CONCLUSION... i

3 Case:0-cv-00-SI Document Filed0/0/ Page of 0 TABLE OF AUTHORITIES Cases Akiona v. United States, F.d, (th Cir. )... Alexander v. Nat l Farmers Org., F.d, (th Cir. )... Anheuser-Busch, Inc. v. Natural Beverage Distribs., F.d, (th Cir. )... Byrnie v. Town of Cromwell Bd. of Educ., F.d, 0- (d Cir. 0)..., Carlucci v. Piper Aircraft Corp., 0 F.R.D., (S.D. Fla. )... Cf. Harkabi v. Sandisk Corp., 0 U.S. Dist. LEXIS (S.D.N.Y. 0)... Chambers v. NASCO, Inc., 0 U.S., ()... Glover v. BIC Corp., F.d, (th Cir. )... Hernandez v. Garcetti, Cal. App. th, 0 ())... 0 Holmes v. Petrovich Development Co., Cal. App. th 0 ()... In re Napster, Inc. Copyright Litig., F. Supp. d 00, 0, 0 (N.D. Cal. 0)..., Kearney v. Foley & Lardner, LLP, 0 F.d, (th Cir. 0)... 0 Leon v. IDX Sys. Corp., F.d,, - (th Cir. 0)... 0,,,,,,,, Micron Tech., Inc. v. Rambus Inc., U.S. App. LEXIS 0 (Fed. Cir. May, )..., Miller v. Time-Warner Communs., Inc., U.S. Dist. LEXIS (S.D.N.Y. )..., Nat l Ass n of Radiation Survivors v. Turnage, F.R.D., - (N.D. Cal. )... Nursing Home Pension Fund v. Oracle Corp., F.R.D.,, (N.D. Cal. 0)..., Pension Comm. of the Univ. of Montreal Pension Plan v. Banc of Am. Secs, LLC, 0 U.S. Dist. LEXIS (S.D.N.Y. 0)... Realnetworks, Inc. v. DVD Copy Control Ass n, F.R.D., (N.D. Cal 0)... Residential Funding Corp. v. DeGeorge Fin. Corp., 0 F.d, 0-0 (d Cir. 0)... Scott v. Beth Israel Med. Ctr., Inc., N.Y.S.d, (Sup. Ct. 0)... Unigard Sec. Ins. Co. v. Lakewood Engineering & Mfg. Corp., F.d,, (th Cir. )...,, United States use of Wiltec Guam, Inc. v. Kahaluu Constr. Co., F.d 00, 0 (th Cir. )... United States v. Kitsap Physicians Serv., F.d, 00 (th Cir. 0)... 0 West v. Goodyear Tire & Rubber Co., F.d, (d Cir. )... Zubulake v. UBS Warburg LLC, F.R.D., (S.D.N.Y. 0)..., ii

4 Case:0-cv-00-SI Document Filed0/0/ Page of Statutes U.S.C. 0..., U.S.C. 0(h)... New York Labor Law 0... New York State Finance Law... 0 iii

5 Case:0-cv-00-SI Document Filed0/0/ Page of 0 NOTICE OF MOTION AND STATEMENT OF RELIEF SOUGHT PLEASE TAKE NOTICE that on September, at :00 a.m. in Courtroom 0, th Floor of the above-entitled Court, located at 0 Golden Gate Avenue, San Francisco, California, Defendant Gilead Sciences, Inc. ( Gilead or Defendant ) will move this Court for an Order dismissing the Complaint of David Moore ( Plaintiff or Moore ) pursuant to the Court s inherent power as a sanction for spoliation of evidence. This motion is based upon this Notice of Motion and Motion, the accompanying Memorandum of Points and Authorities, the accompanying supporting declarations, all pleadings and papers on file in this litigation, and upon such other matters as may be presented to the Court at or before the time of the hearing. Defendant respectfully requests that this Court enter an Order dismissing Plaintiff s Complaint with prejudice. By: /S/ Richard A. Jones RICHARD A. JONES (BAR NO. ) COVINGTON & BURLING LLP FRONT STREET SAN FRANCISCO, CA () -000 RJONES@COV.COM THOMAS S. WILLIAMSON, JR. (PRO HAC VICE) SHIMICA D. GASKINS (PRO HAC VICE) COVINGTON & BURLING LLP PENNSYLVANIA AVE., N.W. WASHINGTON, DC 00 () -000 TWILLIAMSON@COV.COM SGASKINS@COV.COM Attorneys for Defendant Gilead Sciences, Inc.

6 Case:0-cv-00-SI Document Filed0/0/ Page of 0 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT S MOTION FOR SANCTIONS BASED ON PLAINTIFF S SPOLIATION OF EVIDENCE Pursuant to the Court s inherent power, Defendant Gilead Sciences, Inc. ( Defendant ) hereby moves the Court for the entry of an Order dismissing this action with prejudice as a sanction upon David Moore ( Plaintiff ) for the spoliation of evidence. His demonstrably egregious conduct undoubtedly constitutes spoliation and is precisely the exceptional conduct for which dismissal is appropriate. INTRODUCTION AND STATEMENT OF ISSUES TO BE DECIDED Defendant asks this Court to decide whether: () Plaintiff engaged in spoliation by deliberately and intentionally destroying thousands of potentially relevant documents and completely wiping his computer hard drive; and () the appropriate sanction for such spoliation is dismissal of the Complaint, with prejudice. Plaintiff, David Moore ( Moore or Plaintiff ), previously worked as a therapeutic specialist at Gilead Sciences, Inc. ( Gilead ) between 0 and 0. In November of 0, Moore filed a qui tam Complaint against Gilead alleging violations of the False Claims Act, as codified at U.S.C. 0. Despite knowing that he intended to pursue a qui tam action against Gilead as early as the spring of 0, Moore repeatedly and intentionally destroyed relevant documents, correspondence, electronic mail, and other evidence critical to the defense of this case; he did so by wiping data from the hard drive of his company-issued laptop computer. Moore continued his spoliation activities over a two-year period (0-0) and thereby caused the destruction of more than 0,000 potentially relevant electronic files. Moore s deposition testimony and Gilead s forensic examination of his work-laptop hard drives show the following:

7 Case:0-cv-00-SI Document Filed0/0/ Page of 0. Moore wiped his work computer frequently in 0, as often as once a month, after retaining counsel and deciding to pursue litigation against Gilead.. Moore wiped his hard drive at least six times between September and November 0; notably, the last of those wipings occurred just one week before Moore filed his qui tam action against Gilead on November, 0.. In August 0, well after he was engaged in litigation against Gilead and well after he had received a December 0 legal hold memorandum instructing him not to destroy any documents specifically relating to a subpoena issued by the Department of Justice in furtherance of his own qui tam complaint, Moore completely wiped his hard drive destroying innumerable documents likely relevant to this litigation.. Moore has admitted that his wiping was a deliberate, intentional act meant to ensure that Gilead did not have access to information on his work computer because he was expecting that Gilead would be his enemy in litigation. In addition, both in his interrogatory responses and his deposition testimony, Plaintiff Moore has attempted to compromise the integrity of the discovery process in order to conceal the extent of his spoliation activities. Moore s frequent and intentional destruction of evidence constitutes egregious misconduct that has seriously prejudiced Gilead s ability to defend this case adequately. Accordingly, this Court should dismiss Moore s claims. FACTUAL BACKGROUND Moore was employed by Gilead from March, 0 until October, 0 as a therapeutic specialist (sales representative) of HIV drugs covering the sales territory encompassing South Brooklyn in New York City. See Pl. s Third Am. Compl.. In the spring of 0, Moore began contemplating qui tam litigation against Gilead and consulting with counsel. See Ex. B, Dep. of David Moore, Vol. II at. During that time, he intentionally engaged in activities on behalf of Gilead that he claims were illegal, at least in part, All referenced exhibits are attached to the accompanying Declaration of Shimica Gaskins. All exhibits are hereafter cited as Ex. A-Ex. H.

8 Case:0-cv-00-SI Document Filed0/0/ Page of 0 with the intent of creating evidence in furtherance of his qui tam case and to try to qualify for a multimillion dollar financial reward. See id. at -0. Also during that time, he secretly taped his co-workers on sixteen occasions to further his qui tam ambitions. See Ex. A, Dep. of David Moore, Vol. I at. He later continued those activities in 0 and 0 in cooperation with the FBI. See id. On November, 0, Moore filed a qui tam complaint under seal against Gilead. See Pl. s Third Am. Compl.. The gravamen of his Complaint was that Gilead pressured its sales staff to arrange speaker programs to facilitate payments to physicians who were potential prescribers of Gilead s products in order to increase the physicians volume of prescriptions. See id; see also Ex. A at,. Because the qui tam case was filed under seal in 0, Gilead was unaware of Moore s identity until mid-august 0. In March 0, after receiving a less-than-satisfactory annual performance review in the prior month, Moore requested to take a medical leave of absence from Gilead. He now claims that he suffered from anxiety and other ailments because he was allegedly pressured to engage in illegal marketing activities. See Ex. A at,,, and. He began his medical leave on March, 0. He was originally scheduled to return to work on May, 0. See id. at,. However, Moore requested several extensions of his leave, which Gilead granted, see, e.g., id. at -, although Gilead also informed Moore on repeated occasions that he would lose his right to reinstatement if he stayed on medical leave beyond June, 0, see id. at -. Following the third leave extension and after more than four months of leave had elapsed, Gilead informed Moore on August, 0 that, due to business necessity, Gilead was in the process of filling Moore s position. See id. at. Moore acknowledges that Gilead was unaware that he had been acting as a qui tam relator at the time the company sent this letter. See

9 Case:0-cv-00-SI Document Filed0/0/ Page of 0 Ex. B at -00; Ex. A at One week later (August, 0), Moore responded stating that he could return to his therapeutic sales position immediately with no medical restrictions. See id. Even though he had an unsatisfactory job performance record, Moore was allowed to apply to fill his former position. See id. at 0-. Gilead interviewed Moore for his former position as well as several other candidates, but he was not selected. See id. at ; Ex. B at. Gilead eventually terminated Moore at the end of October 0. See Ex. B at. The Department of Justice ( DOJ ) investigated Moore s claims. See Ex. B at. However, in March 0, DOJ declined to intervene in Moore s qui tam suit. See id. at -. Subsequently, Moore voluntarily dismissed his underlying qui tam allegations against Gilead. See id. At 0; see also Pl. s Mot. to Dismiss [Dkt. No. ]. On October, 0, Moore filed a Third Amended Complaint alleging, inter alia, that Gilead had terminated his employment in violation of the anti-retaliation provisions of the False Claims Act, as codified at U.S.C. 0(h); the New York Whistleblower Law, as codified at New York Labor Law 0; the New York False Claims Act, as codified at New York State Finance Law ; and public policy. See generally Pl. s Third Am. Compl. Specifically, Moore alleges that when Gilead declined to rehire him as a therapeutic specialist for the Brooklyn sales territory, the company acted in retaliation for his filing a qui tam action. See id.. Moreover, he continues to assert that the alleged pressure by Gilead to conduct speaker programs was the cause of his medical condition as well as the basis for his underlying qui tam claim. See id. ; see also Ex. A at,. Moore has now admitted to erasing numerous files deliberately and repeatedly from the computer that Gilead provided him as an employee. See Ex. B at -. As discussed in greater detail below, his unlawful actions both while contemplating litigation and subsequent to his filing suit destroyed the files and made them unrecoverable.

10 Case:0-cv-00-SI Document Filed0/0/ Page0 of 0 A. Moore Wiped His Gilead Computer at Least Six Times in 0 Despite Contemplating Litigation and Taking Steps to File a Qui Tam Complaint Against Gilead While employed at Gilead, Moore received two hard drives for his work laptop a Seagate External USB Hard Disk Drive (the Seagate hard drive ) and a Toshiba 0GB Hard Disk Drive (the Toshiba hard drive and, collectively, the hard drives ). See Ex. C, Forensic Report, at ; id., CR at. He used his company laptop and the hard drives installed in them to carry out his daily work as a therapeutic specialist for Gilead. See Ex. B at 0-0. In the spring of 0, Moore began contemplating litigation against Gilead and contacted counsel for assistance. See id. at -. By September of 0, Moore had retained [his] attorneys and [he] was already communicating with [his] attorneys regarding... filing the qui tam. See id. at. Around this same time, Moore, on his own initiative, installed software called Secure Clean on his Gilead laptop, which he used to wipe the computer s hard drive frequently. See id. at,. SecureClean is manufactured by White Canyon Software. White Canyon Software specializes in the manufacture and selling of applications designed to permanently destroy electronically stored information (ESI). Ex. C, CR at ; see also Ex. B at -. The Secure Clean software provides several options, including a quick clean and deep clean option. See Ex. C, CR at,. Moore performed both quick clean and deep clean wipes on his computer in 0. See Ex. B at -. He estimated that he did this as often as once a month. See id. at. Specifically, he performed four quick clean wipes in 0 three on October and one on A quick clean deletes internet files, deleted files, s, and temporary files within a couple of minutes. A deep clean is more time consuming and intensive. The deep clean option overwrites and permanently deletes files from a hard drive. See id.

11 Case:0-cv-00-SI Document Filed0/0/ Page of 0 October. See Ex. C, CR at. He also performed two deep clean wipes in 0 one on September and one on November. See id. He admits that the quick cleans and deep cleans permanently erased any files from the hard drive that he had specifically designated for deletion, including temporary internet files, files in the Recycle bin, and deleted files. See Ex. B at,,. Further, Moore acknowledges that there is no way to verify exactly the types or content of the documents that were wiped. See id. at. In his deposition, Moore explained that he wiped the computer regularly from the time [he] installed [the program]. See id. at. That is essentially when [his] communications with the government began and that is when... [he] wanted to keep all those communications separate [He] wanted to prevent Gilead from learning of those communications because then they would know about the qui tam. See id. Moore filed his qui tam complaint on November, 0. See Pl. s Third Am. Compl.. Just one week before filing his qui tam complaint, on November, Moore performed a deep clean wipe. See Ex. C, CR at. Moore also received a legal hold memorandum in December 0 instructing him not to destroy any documents relating to a DOJ subpoena that had been issued for Moore s qui tam complaint. See Ex. D, Legal Hold Memo; Ex. B at -. B. Moore Performed a Complete Wipe of His Gilead Computer in 0 After He Had Commenced Litigation Against Gilead In 0, Moore intentionally and completely wiped his hard drive, almost two years after he had sued Gilead, destroying numerous documents potentially relevant to this litigation. The software used was called Wipe Drive by White Canyon. See Ex. B at. Moore found this software by doing an internet search. See id. at. He purchased the software in 0 and ran the software many times to make sure everything was wiped. See id. at,. Moore chose to delete everything when the White Canyon application advised him that the wiped information and documents would be permanently irretrievable. See id. at. He

12 Case:0-cv-00-SI Document Filed0/0/ Page of 0 deleted sales data, personal documents, action plans, communications regarding his search for employment outside Gilead, and s regarding assistance to the government s investigation. See id. at,. He admitted that these were deliberate and intentional acts on his part because he felt the documents on his computer were a matter of personal privacy, and he did not want Gilead, described by him as his enemy, to go through his personal s. See id. at,. In addition, he claimed that he had been communicating with his lawyers via his work computer for a two- or three-year period at that time, and he did not want Gilead to have access to information that he regarded as privileged. See id. at. C. Forensic Analysis Documented Specific Instances of Moore s Destruction of Evidence Gilead retained Guidance Software, Inc. to perform a forensic analysis of the Seagate and Toshiba hard drives that Moore possessed while employed by Gilead. Guidance Software s Senior Director of Risk Management, Andreas T. Spruill, conducted the forensic analysis and provided examination reports of each hard drive. See Ex. C at. Mr. Spruill s analysis of the Seagate hard drive revealed that on September, 0, Moore installed SecureClean onto his work laptop. See id., CR at. Following the installation, Moore initiated the application s deep clean function. See id. This action permanently destroyed all deleted , temporary internet files, and temporary Windows files, as well as the contents of the devices [sic] unallocated space, file slack and MFT entries of deleted items. See id. On October, 0 and October, 0, Moore initiated the quick clean function. See id. at. This action permanently destroyed all deleted , temporary internet files and temporary Windows files. See id. And, on November, 0, Moore initiated a deep clean. See id. The use of these applications resulted in the erasure of 0,00... deleted items. See id. at. (Emphasis added.)

13 Case:0-cv-00-SI Document Filed0/0/ Page of 0 The forensic analysis of the Toshiba hard drive commissioned by Gilead confirmed that no content could be recovered from the wiping in 0 and that the hard drive s data storage areas was completely overwritten [in 0] with a repetitive pattern consisting of the FF hexadecimal value. See Ex. C at. The report concluded that an unknown drive wiping utility [was used] to overwrite the data storage area. See id. at. D. Moore Provided Materially Incomplete Interrogatory Responses Regarding His Wiped Hard Drives and Attempted to Give False Testimony at His Deposition Moore admitted to the 0 wiping of the Toshiba hard drive in his Response and Objections to Gilead s First Set of Interrogatories dated February,, which inquired about wiping activities by Moore between January 0 and the present. See Ex. E, Pl. s Interrog. Resp., No.. Moore stated that, [he] carried out the erasing of the laptop used for Gilead in approximately August or September 0. See id. However, he failed to include in this answer any information regarding the wiping that occurred with the Seagate hard drive in 0. During his deposition, Moore again admitted to deploying the wiping program in August 0. See Ex. B at 0-0. He stated that his Interrogatory answer was to the best of [his] recollection accurate and truthful. See id. at 0. When confronted with the possibility that his Interrogatory answer was inaccurate, Moore flatly denied that the answer was not fully accurate. See id. In response to more pointed questioning about his activities in 0, Moore s recollection was abruptly stirred; and only then did he provide testimony that he frequently Moore asserted his denial at deposition even though Gilead s outside counsel had informed Moore s attorney several months earlier that we have reason to believe that your client [Moore] is not being forthcoming about how often he has engaged in spoliation of evidence since January, 0. Ex. F, Letter to Rob Hennig from Thomas S. Williamson, Jr. (Feb., ). (Gilead does not believe, and does not intend to suggest, that Moore s counsel was aware that Moore had provided a materially incomplete interrogatory response prior to Moore s deposition testimony.)

14 Case:0-cv-00-SI Document Filed0/0/ Page of 0 used the wiping software to destroy data over a period of several months in 0. See Ex. B at -. LEGAL ARGUMENT The first section of the legal argument describes the manner in which Moore s misconduct meets the established definition of spoliation as willful destruction of evidence. This conclusion is warranted both because Moore had a duty to preserve the evidence he destroyed and because he acted with a culpable state of mind. The second section of the argument focuses on why dismissal is the appropriate sanction for Moore s egregious misconduct. The two key considerations are the prejudice to Gilead resulting from Moore s misconduct and the inadequacy of a lesser sanction such as an adverse inference instruction to the jury or the exclusion of a particular witness testimony. The third and final section of the argument explains why granting monetary sanctions against Moore is appropriate in this case. I. Moore Repeatedly Engaged in Willful Destruction of Evidence Spoliation is the destruction or significant alteration of evidence, or the failure to preserve property for another s use as evidence, in pending or future litigation. Kearney v. Foley & Lardner, LLP, 0 F.d, (th Cir. 0) (quoting Hernandez v. Garcetti, 0 Cal. Rptr. d, (Ct. App. )). The facts in this case demonstrate Plaintiff s blatant and repeated resort to spoliation as a deliberate litigation tactic. A party s destruction of evidence qualifies as willful spoliation if the party has some notice that the documents were potentially relevant to the litigation before they were destroyed. Leon v. IDX Sys. Corp., F.d, (th Cir. 0) (quoting United States v. Kitsap Physicians Serv., F.d, 00 (th Cir. 0) (internal quotation marks and citation omitted)). Moore willfully destroyed evidence in bad faith because he destroyed documents that he knew were relevant to his litigation with the intention to prejudice Gilead. 0

15 Case:0-cv-00-SI Document Filed0/0/ Page of 0 A. Moore destroyed relevant documents even though he had a duty to preserve those documents. When Moore wiped his hard drives in 0 and 0, he had a duty to preserve those files on his computer. As soon as a potential claim is identified, a litigant is under a duty to preserve evidence that the party knows or reasonably should know is relevant to the action. See Nat l Ass n of Radiation Survivors v. Turnage, F.R.D., - (N.D. Cal. ). The obligation to preserve also attaches when a party should have known that the evidence may be relevant to future litigation. In re Napster, Inc. Copyright Litig., F. Supp. d 00, 0 (N.D. Cal. 0) (quoting Zubulake v. UBS Warburg LLC, F.R.D., (S.D.N.Y. 0)) (emphasis added). The litigation does not need to be underway or immediately pending. See Unigard Sec. Ins. Co. v. Lakewood Engineering & Mfg. Corp., F.d, (th Cir. ) (upholding the district court s exclusion of testimony based on evidence the plaintiff destroyed two years before filing suit). As long as litigation is reasonably foreseeable, a party has a duty to preserve evidence. Micron Tech., Inc. v. Rambus Inc., U.S. App. LEXIS 0, at *- (Fed.Cir. May, ). The Federal Circuit, in Micron Technology, recently held that litigation was reasonably foreseeable for the party that had destroyed and failed to preserve evidence for reasons that included: () the party was on notice of the actions that would give rise to the litigation; () that the party had taken steps in furtherance of the litigation; and () that because the party was the plaintiff, whether litigation was commenced in fact depended upon that party s decision to bring suit. Id. Further, the court noted that the important inquiry is not whether a particular document made litigation reasonably foreseeable, but whether the totality of circumstances as of the date of the document destruction made litigation reasonably foreseeable. Id. at *. The facts of Moore s case easily demonstrate that litigation was reasonably foreseeable; thus, Moore had a duty to not permanently delete documents from his work laptop.

16 Case:0-cv-00-SI Document Filed0/0/ Page of 0 Notably, Moore admitted that he was contemplating litigation as early as the spring of 0. See Ex. B at -. He consulted with attorneys to assist him with his qui tam action in the spring of 0. See Ex. A at. As in Micron Technology, by this time Moore was planning to file suit against Gilead. Moore was also aware of any alleged actions by Gilead that would give rise to litigation. Moreover, Moore had taken steps in furtherance of the litigation namely, secretly taping his colleagues and hiring attorneys for the purpose of litigation, see id. at ; Ex. B at, and intentionally increasing the number of speaker programs that he considered to be illegal. Ex. B at -. Simultaneously, while seeking to create this evidence in support of his case, Moore engaged in a deliberate effort to destroy files of his own choosing from his computer. Namely, Moore performed four quick clean wipes in 0. See Ex. C, CR at. He also performed two deep clean wipes, including one on November, see id. at -, just a week before he filed his qui tam complaint, see Pl. s Third Am. Compl.. Thus, the totality of the circumstances as of the fall of 0 demonstrates that Moore destroyed documents when litigation was reasonably foreseeable and, in fact, was being initiated. Likewise, Moore renewed his preoccupation with destroying evidence on an even grander scale in the late summer of 0. At that time, Moore s qui tam action was well underway. In addition, he had received a legal hold notice on December, 0 instructing him not to destroy any documents that could be related to the DOJ s then pending investigation of Gilead. See Ex. D. Nevertheless, Moore knowingly and deliberately wiped all information from his laptop in August of 0 before returning the laptop to Gilead. See Ex. B at 0-0. Given that it was Moore s qui tam complaint that launched the DOJ s He also received reminder notices on October, 0 and October, 0. See Ex. H, Legal Hold Memos.

17 Case:0-cv-00-SI Document Filed0/0/ Page of 0 investigation of Gilead and that he had previously received a legal hold notice relating to that very investigation, Moore surely knew that he had a duty to preserve information related to his own qui tam complaint. Moore has claimed that he [did] nothing wrong, and his wiping is not a big issue because the s erased were simply communications with his counsel. See id. at -. These claims wholly lack merit. The forensic analysis was able to uncover the names of some files that were deleted in 0, and those names appear to relate to issues of relevance to his claims. For example, the deleted file names refer to the very physicians in Moore s sales territory namely, Dr. Brutus and Dr. Exilhomme for whom Moore claims he was pressured to conduct the allegedly illegal speaker programs, see Ex. A at,. Although the forensic analysis recovered the names of these files, the content of the files was permanently deleted. See Ex. C, CR at -. Moore admittedly destroyed documents relating to sales data, personal files, action plans, communications regarding his search for employment, and s regarding assistance to government investigators, see Ex. B at,, which would have been discoverable, or could have led to the discoverability of admissible evidence, in the present litigation. Moreover, Moore has also admitted to engaging in instances of on-thejob misconduct himself, see id. at -, though he purportedly does not recall deleting any documents that would evidence this, see id. at. To the extent that Moore deleted communications with his attorneys, his deletions nonetheless constitute spoliation. See Ex. E, No.. During Moore s employment, Gilead maintained a computer-usage policy that expressly informed employees that they had no right of Other notable file names included: () The HIV Drugs Mentioned in the tapes via eye witness accounts and supporting documentation.doc ; () Clean My Computer ; () Archive.pst ; () archive.pst ; () Outdated mail 0--0.pst. See Ex. C at GS_00000, GS_0000, GS_0000, and GS_0000.

18 Case:0-cv-00-SI Document Filed0/0/ Page of 0 privacy with regard to information on their work computers. See Ex. G, Employee Handbook. Courts have held that employees who are told that their activities on company-provided computers are subject to being monitored and should not be used for personal activities do not have an expectation of privacy and, thus, cannot claim privilege for communications that were conducted through those same computers. See, e.g., Holmes v. Petrovich Development Co., LLC, Cal. Rptr. d, - (Ct. App. ); Scott v. Beth Israel Med. Ctr., Inc., N.Y.S.d, (Sup. Ct. 0). At bottom, Moore had an obligation to preserve this evidence, which he blatantly disregarded. In any event, Moore s destruction of files was so extensive including over 0,000 files in 0 and a complete erasure of his hard drive in 0 that his spoliation could not possibly have been limited to communications with his attorneys, nor does he claim this to be the case. Accordingly, Moore should have known that the information he wiped from his hard drive from 0 to 0 was potentially relevant to his lawsuit against Gilead; indeed, his contemplation of litigation was the very reason that he destroyed this evidence. B. Moore destroyed evidence with a culpable state of mind. Given that Moore erased s and other documents from his computer in 0 and wiped his hard drive of all documents and programs in 0, it is clear that Moore engaged in these activities in bad faith and with a culpable state of mind. The Second Circuit has held that a culpable state of mind is satisfied by a showing that the evidence was destroyed knowingly, even if without intent to [breach the obligation to preserve it]. Byrnie v. Town of Cromwell Bd. of Educ., F.d, 0 (d Cir. 0) (the intentional destruction of relevant records, either paper or electronic, after the duty to preserve Plaintiff acknowledged that he would abide by the rules, policies, and standards set forth by the Employee Handbook, which contained the Computer Usage Policies. See id.

19 Case:0-cv-00-SI Document Filed0/0/ Page of 0 has attached, is willful). Moore s deposition testimony confirmed without question that his actions were done knowingly and in bad faith. Moore has admitted to seeking out software specifically designed to erase his laptop computer files and wipe his hard drive. See Ex. B at,. He acknowledged utilizing the wiping software frequently in 0 and 0. See id. at,. He confirmed that these were deliberate and intentional acts, see id. at, committed because he did not want Gilead to have access to these documents, see id. at. More specifically, Moore testified that he deleted the information from the hard drive because [he] didn t want Gilead who was out to do [him] harm going through [his] personal s. It was a... a matter of personal privacy. See id. He acknowledged that he understood how the SecureClean software worked and that the program would permanently delete information. See id. at -. Indeed, Moore volunteered at deposition that he had more recently purchased the latest version of the wiping software presumably to continue fulfilling his erasure needs. See id. at. He even testified that he does not feel he did anything wrong because he was attempting to keep information from his enemy, Gilead, and that his behavior should not be a big issue. See id. at,. In addition, Moore attempted to use the discovery process in this case to conceal the full extent of his egregious behavior. In Leon v. IDX Systems Corp., a factually similar case, the Ninth Circuit held that the employee s destruction of data on his employer-owned laptop amounted to willful spoliation of evidence warranting dismissal as a sanction. F.d, (th Cir. 0). Like Moore, Leon destroyed evidence by deleting,0 files from his IDX-issued laptop computer during the pendency of his litigation, which, among other things, alleged violations of the antiretaliation provisions of the False Claims Act and Washington state law. The district court concluded that Leon s behavior amounted to willful spoliation because he knew he was under a

20 Case:0-cv-00-SI Document Filed0/0/ Page of 0 duty to preserve all data on the laptop, but intentionally deleted many files and then wrote a program to write over the deleted documents. Id. Much like here, Leon admitted that he intended to destroy information but contended that his intent was merely to protect his privacy. See id. The district court rejected this argument, and the Ninth Circuit agreed. See id. The Ninth Circuit noted that Leon used the wiping software well after IDX had filed a declaratory judgment action seeking to establish whether the company could legally terminate Leon. See id. The Court reasoned, therefore, that Leon was on notice that the files created on his employer-issued computer were relevant to a lawsuit centering on the existence of legitimate grounds for firing Leon. See id. Because Leon s wiping of,0 files was indisputably intentional, the Ninth Circuit held that the district court s finding of willful spoliation and dismissal was not clearly erroneous. See id. Moore, even more egregiously, intentionally destroyed over 0,000 files; in addition, he carried out his most extensive wiping after he had instituted qui tam litigation against Gilead and after he had received a litigation hold notice. Moore s conduct during discovery further corroborates the reality that he destroyed evidence with a culpable state of mind. Moore provided a materially incomplete answer to Gilead s interrogatories when he omitted any reference to his wiping activities in late 0 in the weeks shortly before he filed his qui tam action. At deposition, he first denied any wiping activities in 0, but then when directly challenged that he was not answering accurately he changed his story and definitively affirmed that he had frequently engaged in electronic spoliation in 0. This sort of tactical lack of candor violates the core principles of civil discovery, which rely on adversaries to disclose potentially damaging facts when properly questioned. Accordingly, this Court should find that Moore s acts amount to willful spoliation with an undeniably culpable state of mind.

21 Case:0-cv-00-SI Document Filed0/0/ Page of 0 II. Dismissal Is the Appropriate Sanction for Moore s Egregious Spoliation When a party has destroyed evidence relating to his own lawsuit, the Court may order dismissal under its own inherent powers. See Chambers v. NASCO, Inc., 0 U.S., (); see also Leon v. IDX Sys. Corp., F.d, (th Cir. 0) (quoting Anheuser- Busch, Inc. v. Natural Beverage Distribs., F.d, (th Cir. ) ( Dismissal is an available sanction when a party has engaged deliberately in deceptive practices that undermine the integrity of judicial proceedings because courts have inherent power to dismiss an action when a party has willfully deceived the court and engaged in conduct utterly inconsistent with the orderly administration of justice. )); Unigard Sec. Ins. Co. v. Lakewood Engineering & Mfg. Corp., F.d, (th Cir. ); Zubulake v. UBS Warburg LLC, F.R.D., (S.D.N.Y. 0). The Ninth Circuit has held that a district court should consider the following factors in determining whether dismissal is appropriate: () the public s interest in expeditious resolution of the litigation; () the court s need to manage its dockets; () the risk of prejudice; () the public policy favoring disposition of cases on their merits; and () the availability of less drastic sanctions. Leon v. IDX Sys. Corp., F.d at. While the Court must also consider less severe alternatives than outright dismissal, this Court need not make explicit findings regarding each of these factors. Id. A finding of willfulness, fault, or bad faith is required for dismissal to be proper. Id. Other courts have similarly found that dismissal is warranted when a party behaves egregiously in destroying evidence. See, e.g., West v. Goodyear Tire & Rubber Co., F.d, (d Cir. ) ( Dismissal is appropriate [as a sanction for spoliation] if there is a showing of willfulness, bad faith, or fault on the part of the sanctioned party. ); Miller v. Time- Warner Communs., Inc., U.S. Dist. LEXIS, at *- (S.D.N.Y. Sept., ) (granting dismissal where plaintiff deliberately destroyed evidence and lied about it, noting that [n]o lesser sanction would be adequate to penalize plaintiff for her misconduct and to deter others from engaging in similar conduct in the future ).

22 Case:0-cv-00-SI Document Filed0/0/ Page of 0 It is self-evident that the first and second Leon factors expeditious resolution and docket management weigh totally in favor of dismissal of Moore s action. In addition, although the fourth factor, the policy favoring disposition on the merits, normally weighs in favor of Plaintiff, that assumption is questionable here where there has been so much relevant evidence destroyed that the Court s ability to resolve the litigation on the merits has been significantly impaired. In this regard, one court has emphasized that: Deliberate, willful and contumacious disregard of the judicial process and the rights of opposing parties justifies the most severe sanction. The policy of resolving lawsuits on their merits must yield when a party has intentionally prevented the fair adjudication of the case. By deliberately destroying documents, the defendant has eliminated the plaintiffs right to have their case decided on the merits. Accordingly, the entry of a default is the only means of effectively sanctioning the defendant and remedying the wrong. Carlucci v. Piper Aircraft Corp., 0 F.R.D., (S.D. Fla. ) (citation omitted). Here, the offending party is the plaintiff rather than the defendant, but it is self-evident that the fairness principle and the appropriateness of the sanction do not vary because the defendant is the moving party. As will be shown, application of the third and fifth factors prejudice to Gilead and the availability of a less drastic sanction also argues strongly in favor of dismissal in these circumstances. A. Moore willfully destroyed relevant evidence resulting in prejudice to Gilead. Although the Court need not consider prejudice to the party moving for sanctions when acting under its inherent authority, see Nursing Home Pension Fund v. Oracle Corp., F.R.D., (N.D. Cal. 0), Moore s destruction of relevant evidence has clearly prejudiced Gilead. To establish prejudice, the destroyed evidence must be relevant to the moving party s claim or defense such that a reasonable trier of fact could find that it would support the claim or defense. See Pension Comm. of the Univ. of Montreal Pension Plan v.

23 Case:0-cv-00-SI Document Filed0/0/ Page of 0 Banc of Am. Secs, LLC, 0 U.S. Dist. LEXIS, at *- (S.D.N.Y. Jan., 0); Residential Funding Corp. v. DeGeorge Fin. Corp., 0 F.d, 0 (d Cir. 0) (citing Byrnie v. Town of Cromwell Bd. of Educ., F.d, 0- (d Cir. 0)). [B]ecause the relevance of... [destroyed] documents cannot be clearly ascertained because the documents no longer exist, a party can hardly assert any presumption of irrelevance as to the destroyed documents. Leon v. IDX Sys. Corp., F.d, (th Cir. 0) (quoting Alexander v. Nat l Farmers Org., F.d, (th Cir. )). A court, thus, may assume that destroyed evidence was relevant if it was destroyed through bad faith or gross negligence. See Residential Funding Corp. v. DeGeorge Fin. Corp., 0 F.d, 0-0 (d Cir. 0) ( [T]he intentional or grossly negligent destruction of evidence in bad faith can support an inference that the destroyed evidence was harmful to the destroying party. (emphasis in original)). Here, Moore concedes that he intentionally permanently deleted s, documents, and other correspondence so that Gilead would not have access to information that he kept on his computer. See Ex. B at. For this reason alone, the Court should assume that the destroyed evidence was relevant to Gilead s defense. Moreover, the forensic analysis also supports a finding that Moore deleted relevant evidence. See generally Ex. C. However, there is no way for Gilead to ascertain whether Moore engaged in other instances of illegal or improper conduct, or to recreate the content of the deleted files, which may reveal further wrongful conduct. And, of course, due to the complete erasure of the Toshiba hard drive in 0, Gilead is unable to determine what other relevant files might have existed. The prejudice inquiry looks to whether the [spoiling party s] actions impaired [the non-spoiling party s] ability to go to trial or threatened to interfere with the rightful decision of

24 Case:0-cv-00-SI Document Filed0/0/ Page of 0 the case. Leon, F.d at (quoting United States use of Wiltec Guam, Inc. v. Kahaluu Constr. Co., F.d 00, 0 (th Cir. )). For example, in Leon, the Ninth Circuit held that the types of files that Leon would have deleted out of privacy concerns would likely be at the heart of the defendant s defenses if the files were available. Id. at 0. Because any number of the files Leon deleted could have been relevant to the defendant s claims or defenses, the Court upheld the district court s finding that Leon s spoliation threatened to distort the resolution of the case, and therefore prejudiced the defendant. Id. (quoting Wiltec Guam, Inc., F.d at 0). Here, there is no doubt that Moore s wiping threatens to distort the resolution of this case, id. (quoting Wiltec Guam, Inc., F.d at 0), and prejudices Gilead. It is highly likely, based on Moore s own admissions and intentionally destructive acts, that the evidence destroyed was relevant and helpful to Gilead s defense. See Ex. B at -,. When questioned at deposition, Moore repeatedly confirmed that there is now no way to verify whether the information he deleted was relevant to Gilead s defenses relating to his job performance, his violations of the Gilead Code of Conduct, the justifications for his medical leave extension, his performance at the re-employment interview Gilead offered him in 0, or the extent of his efforts to find alternative employment with other pharmaceutical companies when he was on medical leave from Gilead. See Ex. B at -. Moreover, it is telling that Moore has produced only nine s in response to Gilead s broadly framed requests for production of documents. See Decl. of Celina Holmes-Murphy. The magnitude of Moore s wiping activity is partly evident from Gilead s having located approximately,00 s where Moore was the sender or recipient in the archives of other Gilead employees that did not engage in wiping activities. In addition, although Moore was instructed, and was legally obligated, to retain all of his s potentially relevant to litigation, Moore only archived unique messages. See Decl. of Vicki Clewes.

25 Case:0-cv-00-SI Document Filed0/0/ Page of 0 Moore may contend, in opposition, that Gilead has not been prejudiced because Gilead has backup systems that preserved all the evidence Moore destroyed. Gilead, however, did not back up the hard drives of field sales personnel such as Moore and therefore has no such backup. Although Gilead conceivably backed up certain of Moore s through its regular backups of the Microsoft Exchange data stores, such backup systems generally are not a feasible means of recovering specific documents because they are designed to cope with catastrophic or disaster-recovery situations that damage or destroy a company s entire computer system. See Decl. of Vickie Clewes. In addition, although Gilead instituted the capability to archive certain employee s sent or received on company-issued laptops by field staff beginning in June 0, that capability did not exist in 0 when Moore was frequently wiping his computer in anticipation of litigation. Id. As a consequence, Gilead does not have copies of, or reasonable access to, Moore s s erased prior to June 0, and has no potential access whatsoever to his non- files that were wiped from his laptop s hard drive. In any event, because Moore has deprived Gilead of the opportunity to review the totality of what was wiped and because Moore s wiping of his hard drive on multiple occasions is so egregious, the prejudice cannot be cured; and dismissal is justified. Cf. Harkabi v. Sandisk Corp., 0 U.S. Dist. LEXIS, at * (S.D.N.Y. Aug., 0) (noting that dismissal is justified in only the most egregious cases, such as where a party has... intentionally destroyed evidence by burning, shredding, or wiping out computer hard drives ) (internal citations omitted) (emphasis added). B. There Is No Less Drastic Sanction Available Here As noted by the Court in Nursing Home Pension Fund v. Oracle Corp., F.R.D., (N.D. Cal. 0), courts have developed three types of sanctions for destruction of evidence. First, a court can instruct the jury that evidence made unavailable by a party was

26 Case:0-cv-00-SI Document Filed0/0/ Page of 0 unfavorable to that party. See Realnetworks, Inc. v. DVD Copy Control Ass n, F.R.D., (N.D. Cal. 0) (citing Glover v. BIC Corp., F.d, (th Cir. )); Akiona v. United States, F.d, (th Cir. )). Second, a court can exclude witness testimony based on the spoliated evidence. See id. (citing Glover, F.d at ; Unigard Sec. Ins. Co. v. Lakewood Engineering & Mfg. Corp., F.d, - (th Cir. )). And third, the court can dismiss the claim of the party responsible for the spoliation. See id. (internal citations omitted). Here, the first two lesser sanctions are manifestly inadequate as a remedy for Moore s spoliation. As has been discussed above, Moore s spoliation reflects a campaign of deliberate destruction of evidence which extended over two years for the express purpose of blocking Gilead s access to information that might be useful for Gilead s defense. See Ex. B at,,. As a consequence, Gilead would largely be defenseless in response to any material that Moore might use to overcome the presumption. See Leon v. IDX Sys. Corp., F.d, 0 (th Cir. 0). Moreover, the exceptionally wide swath of Moore s spoliation activities tends to render the adverse inference unmanageably broad and diffuse because Moore s extensive wiping has foreclosed the ability to associate an adverse inference with any specific category of documents. Also, the scale of Moore s spoliation activities is clearly in line with precedents that have found dismissal to be the appropriate sanction. See, e.g., id. at (dismissal was proper Additional considerations in determining whether dismissal is appropriate are whether the district court implemented alternative sanctions before ordering dismissal and whether the district court warned the [spoliating] party of the possibility of dismissal before ordering dismissal. See Leon v. IDX Sys. Corp., F.d, 0 (th Cir. 0). However, as was the case in Leon, these options are not applicable here because the plaintiff erased the files and ran the wiping program before the district court had an opportunity to compel discovery or otherwise order lesser sanctions. Id.

27 Case:0-cv-00-SI Document Filed0/0/ Page of 0 where plaintiff deliberately, and without remorse, deleted and wiped files that might have been relevant to plaintiff s claims); Miller v. Time-Warner Communs., Inc., U.S. Dist. LEXIS, at *- (S.D.N.Y. Sept., ) (dismissal was proper where plaintiff deliberately destroyed evidence and repeatedly committed perjury regarding same). As has been noted, Gilead s forensic report indicates that Moore wiped more than 0,000 files in 0, see Ex. C, CR at ; and Moore himself openly acknowledges that he wiped his entire hard drive in 0, see Ex. B at,, so that no party can assess the volume of files destroyed by Moore at the very time he contends that Gilead was subjecting him to retaliation. It is also notable how often at deposition Moore conceded that his allegations against Gilead were not supported by any documentation or by any corroborating witness. See, e.g., id. at -,. In other words, Moore s spoliation strategy is a calculated gamble on his part to deprive Gilead of corroborating documentation for summary judgment and potential defenses at trial based on damaging admissions. An adverse inference instruction would effectively reward Moore s tactic, at least in part, by weakening the prospects for summary judgment in favor of Gilead and by requiring Gilead to have to endure the substantial burden and expense of further discovery and a jury trial. The exclusion of witness testimony is similarly not feasible in this case because of the exceptional thoroughness and extensiveness of Moore s wiping activities over a two-year period. This lesser sanction would be extremely difficult to tailor to the circumstances of this case where the Plaintiff has worked so assiduously to create such a large evidentiary void. Lastly, the adverse inference alternative is not an adequate sanction because it allows Moore to continue imposing substantial costs on Gilead that will necessarily have to be incurred prior to trial. Those costs include, for example, expenses for expert-witness discovery; the substantial costs of preparing and arguing a summary judgment motion; and, of course, time-