It’s common for employees to use their personal cell phones for business-related purposes, including emails, phone calls, and even text messages. However, such use calls into question whether an employer has a duty to preserve these communications in anticipation of litigation. In Miramontes v. Peraton, Inc., a Texas judge ruled yes, an employer has a duty to preserve business-related text messages on their employees’ personal devices.
Carlos Miramontes began working for Peraton after Peraton acquired Miramontes’ former company. Following the acquisition, Peraton started “Project Falcon” a dubious named series of layoffs, including the position occupied by Miramontes. Peraton justified Miramontes’ termination as part of a company-wide reduction in force, necessitated by budgetary constraints. However, Miramontes alleged the layoffs were actually discriminatory terminations based on employees’ ages and races.
Following his termination, Miramontes sent Peraton a litigation hold letter, detailing his allegations and providing notice for Peraton to preserve all documents, including “emails, texts, attachments, and any other method or means of communications, internally or externally.” Peraton instructed Miramontes’ former supervisor to preserve all relevant emails, but there was no such instruction for relevant text messages.
Peraton filed a motion for summary judgment, and Miramontes planned to admit the relevant text messages as evidence of his claims. However, Peraton employees had deleted all relevant text messages. Miramontes argued such destruction warranted sanctions for spoilation of evidence, including a court finding of liability in favor of Miramontes’ claims of discrimination.
The court based its spoilation analysis on five factors: (1) whether Peraton controlled the texts, (2) whether Peraton had a duty to preserve the texts, (3) whether Peraton intentionally destroyed the texts, (4) whether Peraton acted in bad faith, and (5) whether Peraton’s failure to preserve the texts caused Miramontes prejudice.
The court answered “yes” to all five factors. First, Peraton argued the relevant text messages were stored on employees’ personal devices, not company cell phones. However, the court noted that standard Peraton business practice was not to issue company cell phones, but rather to encourage employees to use their personal cell phones for business purposes.
Second, the court held Peraton had a duty to preserve the texts because Peraton had notice that the texts were possible evidence related to Miramontes’ upcoming litigation. Third, the court ruled that Peraton intentionally destroyed the texts. One of Peraton’s employees, who exchanged the text messages, admitted in his deposition that he intentionally destroyed the texts. The court determined the destruction occurred “within the course and scope of [the employee’s] employment” and thus “Peraton can be held vicariously liable.” Miramontes v. Peraton, Inc., No. 3:21-CV-3019-B, 2023 WL 3855603 at *6 (N.D. Tex. June 6, 2023).
Fourth, the court reasoned that Peraton acted in bad faith. Following Peraton’s receipt of Miramontes’ litigation hold letter, Peraton instructed its employees to preserve relevant emails, but Peraton failed to instruct its employees to preserve relevant text messages. Accordingly, the court found Peraton’s actions supported an inference of bad faith. The combination of these factors prejudiced Miramontes’ ability to present evidence in favor of his claims.
Miramontes v. Peraton, Inc. suggests that businesses have a duty to preserve business-related text messages or other employee communications even on personal devices. When in doubt, businesses should air on the side of preservation rather than destruction. Failure to preserve such communications can result in severe sanctions against the business during litigation.