MOVE, INC., REALSELECT, INC., a Delaware corporation, TOP PRODUCER SYSTEMS COMPANY, a British Columbia unlimited liability company, NATIONAL ASSOCIATION OF REALTORS®, an Illinois non-profit corporation, and REALTORS® INFORMATION NETWORK, INC., an Illinois corporation, v. ZILLOW, INC., a Washington corporation, ERROL SAMUELSON, an individual, and CURT BEARDSLEY, an individual, DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY 1425 Fourth Avenu HEARING BRIEF FILED 16 APR 07 PM 4:28 The Honorable Sean Qi papell ‘SUPERIOR COURT CLERK FILED CASE NUMBER: 14-2-07669-0 SEA SUPERIOR COURT FOR THE STATE OF WASHINGTON IN AND FOR THE COUNTY OF KING a Delaware corporation, NO. 14-2-07669-0 SEA DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY HEARING BRIEF Plaintiffs, Defendants. SAVITT BRUCE & WILLEV 11 Suite 800 Seattle, Washington 98101-2272 (206) 749.050018 19 A. Introduction, Plaintiffs request not just extreme but unprecedented sanctions for spoliation of evidence—either a default judgment or an unusual and draconian adverse inference jury instruction. ‘They support their request with shrill rhetoric, characterizations of the facts which the actual evidence does not support, and a misreading of the controlling Washington law Plaintiffs attempt to establish motive and bad faith by relying on their own unproven allegations of a scheme to misappropriate trade secrets; and they perplexingly assert that a standard requiring proof of bad faith intent to destroy important evidence—the plainly applicable standard—somehow sets an impossible bar. Plaintiffs’ overheated argument betrays the absence of merit to what lies beneath: both the evidence and the law demonstrate that Plaintiffs cannot prove what they assert, and the case for spoliation fails. Beardsley’s Opposition to Plaintiffs’ Motion for Evidence Spoliation Sanctions, submitted January 25, 2016, contains a detailed review of the evidence and applicable law. We refer the Court to that opposition for that detail, and here focus on summarizing the evidence that will be presented at the upcoming hearing. In brief: the evidence shows that Beardsley did not have bad faith intent to destroy evidence, as required under Washington law to find spoliation, It will also show that we have significant information about what was deleted: much of it has been recovered, and shows that the deletions weren't of important information; and the forensic analysis of the substantial volume of available information and data shows that much of what hasn’t yet been recovered is immaterial Finally, and in any event, even if there were spoliation here—and there wasn’t—the extreme sanctions requested by Plaintiffs would not be supported under Washington law. B. Plaintiffs’ Motion Assumes the Wrongdoing They Must Prove. Plaintiffs’ spoliation motion is premised on Plaintiffs’ allegations of a concerted plan and scheme to misappropriate trade secrets—on the assumption that, in fact, there was such a scheme, They argue Curt Beardsley is not credible because, they allege, he participated in the alleged scheme. They argue that the Court should disregard and disbelieve Beardsley’s SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF | Seattle, Washington 98101-2272 (206) 749.050018 19 ations of what he did and why he did it because, they say, he was trying to cover up expla wrongdoing as a participant in the scheme to steal secrets. In short, Plaintiffs assume an (—was there a scheme to answer in their favor to the very question posed by the lawsui misappropriate trade secrets—and then argue that the existence of this scheme demonstrates the required elements on their spoliation motion of both bad faith and the importance of any data that was destroyed or lost But, if there was no evil plan to misappropriate trade secrets, then Beurdsley’s explanations both make sense and are credible. Take away the assumption that there was scheme to misappropriate, and Plaintiffs’ motion teeters and collapses. Setting allegations and assumptions aside, and looking at the very documents Plaintiffs rely upon as their proof, there is no evidence of the alleged scheme. The key documents and evidence on which Plaintiffs rely for their conspiracy theory actually establish the contrary. 1, The November 17 emai Plaintiffs point to a November 17, 2013 email from Beardsley to Samuelson entitled “Some Thoughts on Zillow” (Gallegos Ex. B), and latch onto Beardsley’s reference to the “Vichy French” as proof of a sinister plan. But the email itself—including the “Vichy French” reference—does not evidence conspiracy or wrongful intent. A review of the full two-page email makes clear that the considerations on Beardsley’ mind had nothing to do with trade secrets and nothing to do with anything wrongful; rather, itis personal and private reflection on a possible career move. Beardsley reflected on Move’s inability to change in an industry in the throes of technological upheaval. Having been Move’s spokesperson to the real estate industry who, in that role, had often vilified Zillow, Beardsley too recognized that some might view a move to Zillow as a betrayal; he wanted to avoid this perception, and he wanted to make sure he didn’t view himself as a traitor. Hence the reference to the Vichy French, in which Beardsley asked how one leaves a company for its arch rival without feeling or appearing to be a traitor. It’s a thoughtful question and a fair one, Nothing SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF - 2 Seattle, Washington 98101-2272 (206) 749.050018 19 in this email comes close to suggesting a plan or intent to misappropriate trade secrets. Instead it is entirely inconsistent with the existence of such a plan. See Gallegos Ex. B; Opp. at 3-4. 2. “How Z might challenge M.” Plaintiffs likewise point to a document they call “Attack ListHub”, which is actually entitled “How Z might challenge M”. See Gallegos Ex. A. But the document itself and evidence adduced about it disprove the allegation that the document establishes a scheme to misappropriate trade secrets. See Opp. at 4-5. First, nothing in “How Z might challenge M” states or is based on a trade secret. Rather, the document contains Beardsley’s thoughts on how he might succeed if he were to move to Zillow and how Zillow might be more accepted in the industry. Stephen Ex. E at 49- 51. Second, these are Beardsley’s private thoughts; he wrote them down for himself and never shared the document with anyone; there is no evidence that he did. Third, private thinking about how to compete is not wrongful, even if done while working for an employer with whom one plans to compete. E.g., Restatement (Second) of Agency §393, emt. E; Instrument Repair Serv., Inc. v. Gunby, 518 S.E.2d 161, 163-63 (Ga. Ct. App. 1999). In short, Beardsley is entitled to think about leaving and competing, just like anyone else. 3. Beardsley was surprised by Samuelson’s departure. Plaintiffs allege that Beardsley lied when he told Move that he was surprised by Samuelson’s departure. But Plaintiffs’ allegation is not evidence. And the evidence statement and es corroborates Beardsley’s iblishes that he was, in fact, shocked upon learning Samuelson had left. Stephen Ex. E at 117-123; Opp. at 3. It is undisputed that Samuelson “went dark” on Beardsley in February 2014, after telling Beardsley that negotiations with Zillow had regressed; Samuelson began to refer to working out a new role within Move; and Beardsley, by early March, was well into work on behalf of Move for the new industry year. Stephen Ex. E at 117-123; Opp. at 2-3. Beardsley contemporaneously told people within and outside Move that he had been blindsided by ‘Samuelson’s decision to leave, Moreover, upon learning of Samuelson’s exit, Beardsley SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF-3 Seattle, Washington 98101-2272 (206) 749.050018 19 expressed his shock to Samuelson himself in a private text (which is among those Plaintiffs accuse Beardsley of wrongfully deleting); in reply, Samuelson expressed apologies. See Opp. at 3. In short, the contemporaneous evidence corroborates Beardsley’s statement to Move that he had been caught by surprise. 4. ‘There was no scheme to “harvest” Move information. Plaintiffs allege that Beardsley remained at Move after Samuelson’s departure to “harvest more trade secrets”. But there is no evidence to support this allegation: there are no alleged trade secrets in Plaintiffs’ list of allegedly misappropriated secrets that they even contend were conveyed to Beardsley during the time he remained at Move following Samuelson’s departure. Contrary to Plaintiffs’ claims, Beardsley resigned prior to two days of Move strategy meetings. Stephen Ex. L. Rather, the evidence establishes that Samuelson’ resignation precipitated a whirlwind of events in which Beardsley explored his own career choice while both Move and Zillow jockeyed for his services. Beardsley told Move's CEO that he was also talking to Zillow, and the evidence shows that Move knew that Beardsley was in play during this time. On March 12, Beardsley met with Move’s CEO and board chairman to clarify and understand the details of his future position at Move, and he accepted Move’s offer. On March 13 Beardsley turned down Zillow flat, without requesting any counter or further discussions. Stephen Ex. E at 124-25, 130; Opp. at 3 In short, not only has the scheme that Plaintiffs allege not been proven: the contemporaneous evidence shows there was no secret plan. Despite a massive volume of documents and emails produced by Defendants, recovered through forensics, and in Move's possession, as well as depositions of dozens of witnesses, the evidence does not come close to establishing a scheme to misappropriate trade secrets C. ‘There Was No Bad Faith Intent and No Loss of Important Evidence. Confronted by the absence of evidence to support their overheated rhetoric, Plaintifis tum to spotiation as their effort to save their claims without having to prove them, To prove spoliation and obtain consideration of any sanction, Plaintiffs must (1) prove bad faith intent to SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF 4 Seattle, Washington 98101-2272 (2) 749.0500)18 19 destroy relevant evidence and (2) show that the missing material is important, ie., would produce evidence favorable to the moving party's cause. Cook v. Tarbert Logging, Inc., 190 Wn.App. 448, 867 (2015) (bad faith intent required), review denied, No. 92482-1 (Wash. Supreme Court Mar. 30, 2016); Tavai v. Walmart, Inc., 176 Wn.App. 122, 135 (2013) (importance required); see Opp. at 12-15. That is, before the Court may consider a spoliation sanction, it must find that Beardsley acted with the intent to deprive Plaintiffs of information that would benefit their case. 1d, This is not, as Plaintifis would have it, an impossible standard, It is, rather, the law of Washington. Again: Plaintiffs’ spoliation claim is premised on an assumption, that there was a scheme to misappropriate, Plaintiffs argue that Beardsley and Samuelson’s private communications and thoughts prove a sinister plan and further prove that what Samuelson and Beardsley did was a cover up. But take away that assumption, and the lens changes. Beardsley and Samuelson’s secrecy was a product of not wanting their employer to know that either was considering going to work for Move’s arch competitor. This concern is unsurprising, perfectly natural and perfectly legal. Put aside the assumption of a scheme, and Beardsley’s testimony about what he did and why he did it is not only plausible but fully credible. 1. Beardsley’s Actions upon Departure from Move. Plaintiff's point to Beardsley’s deletion of emails and other information from his Move laptop when he left Move. But this activity did not constitute spoliation > Beardsley did eliminate personal information from his Move laptop and ensured that connections to his personal banking and other accounts were disabled. But that is commonplace: many employees do that when they leave a job. Such activity does not suggest bad faith intent to destroy evidence. Beardsley did delete a large volume of old emails that he was supposed to have already deleted under Move’s company policy, in which personal emails were interspersed. That too is commonplace. Further, Beardsley believed he was not deleting unique data, because he understood the Move emails he deleted existed on Move's servers. This is not bad faith intent to destroy evidence. And, as noted below, Move has now admitted that in fact it has backup copies of all 2013 @move.com emails. Peterson Decl. 2. So, in fact, no such emails have been lost. SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF -5 Seattle, Washington 98101-2272 (206) 749.0500> Beardsley did delete his web browser history to rid the computer of remnants of his visits to hard core pornographic web sites. But the intent was to eliminate evidence of, in his view, shameful conduct, not to destroy evidence in this case." See Opp. at 5-6. Plaintiffs also point to Beardsley’ deletion of emails and text messages from his personal accounts and devices when he left Move, This, too, was not spoliation: Beardsley did attempt to delete Move information from his personal accounts and from USB drives. These actions were not wrongful, Beardsley told Move he had done so, and Move did not say he should not have done it. See Opp. at 6, On this issue, Plaintiffs seek to condemn Beardsley no matter what he did: where he eliminated Move information, as he thought he should, Plaintiffs claim he was deleting evidence; where he missed it, Plaintiffs claim he misappropriated Move information, But deletion of information believed to be property of a former employer is not spoliation, N3 Oceanic, Inc, v, Shields, 2006 WL 2433731 (E.D. Pa. 2006); see also Select Med. Corp. v. Hardaway, 2006 WL 859741, at *9 (E.D. Pa, Mar. 24, 2006) (finding of fault requires evidence that party accused of spoliation “intended to impair” moving party's ability to uncover evidence). 2. Beardsley’s Actions while a Non-Party. Plaintiffs point to four matters occurring after Beardsley’s departure from Move but well before they sued him a year later: the reformatting of a 32-GB SanDisk Cruzer USB device; the disposal of a Wester Digital (“WD”) external hard drive; missing USB or “thumb” drives; and the use of cleanup programs in fall 2014, None of this constitutes spoliation. Plaintiffs’ allegation that Beardsley erased data stored on the 32-GB SanDisk thumb drive before turning it over to the neutral expert in October 2015 is a misrepresentation. Plaintiffs were advised in September 2014, in response to the subpoena, that the 32-GB thumb drive had been reformatted in April 2014, shortly after Beardsley left Move and long before " Furthermore, any loss of this evidence was caused in large part by the fact that Beardsley’s Move (and his Zillow) laptop was running a pre-installed program called TRIM that promptly and automatically wiped deleted data as part of the laptops” normal operations. Crain Decl. §f 32, 34. And, contrary to Plaintiffs’ claim and as explained further below, the Cipher program did not eliminate all evidence regarding visits to cloud accounts; evidence of cloud account activity exists in the accounts themselves. SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF 6 Seattle, Washington 98101-2272 (206) 749.0500there was any talk of forensic examinations, Stephen Ex. X at 2. The forensic analysis confirms this. Declaration of David J. Burman, submitted April 1, 2016, Ex. B at {| 116. Asto the WD external hard drive and the “missing” USB devices, preliminarily, Plaintiffs waived their spoliation claim regarding data on these devices. Plaintiffs took possession of Beardsley’s Move laptop—and leamed of the very external devices about which they now complain—in March 2014. But Plaintiffs did not identify or express interest in these devices until 15 months later, in June 2015. See Opp. at 7, 9. Plaintiffs slept on their alleged need for these devices, and Beardsley should not be responsible for any loss of evidence in the interim, Henderson v, Tyrell, 80 Wn. App. 592, 609-11 (1996) (denying spoliation sanctions in part because complaining party waited a year before seeking inspection), Regarding the WD external hard drive: Beardsley, peeved that it wouldn’t work and ‘was no longer functional, threw it against a wall and then threw its remains in the trash. See Opp. at 9. When Beardsley disposed of the WD, he was not a party to the case, and it did not occur to him that he had an obligation to keep it. As for the thumb drives: one was identified in September 2015 and provided to the neutral, Of the two that are missing: Beardsley gave one to his college-age son long before any subpoena or any claims against him, The other has simply never been located. In the course of his work, Beardsley used countless USB devices. There is nothing sinister about losing them. Given that Beardsley did not know he would be sued, and that he had no reason to think these particular USB drives had relevant evidence, the reasonable and best explanation is that these USB drives are simply lost.’ There is no evidence of bad faith intent, and none that the documents on these thumb drives were important, See Opp. at 9. ? Plaintiffs” assertion that Beardsley threw away a device he was obligated to produce pursuant to a CR 45 subpoena is incorrect, and ignores the record regarding Beardsley’ timely response to the subpoena. See Opp. at 7. The forensic analysis shows that one of these, the USB device with serial number beginning ISAA, was connected to the Beardsley family computer in June 2015, before he had any knowledge that Plaintiffs contended this was a device of interest, Plaintiffs allege this proves he intentionally discarded it when they requested it. But Plaintiffs had refused to produce the Move laptop for inspection atthe time they identified these devices, and Beardsley had no reason to think these devices may have had relevant information or to know their serial numbers, ‘When Plaintiffs identified the additional devices they wanted, diligent searches were made to find them, and all thumb drives located ~ 13 of them - were provided to the neutral expert. SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF -7 Seattle, Washington 98101-2272 (206) 749.050018 19 Finally, Plaintiffs point to Beardsley’s use of cleanup programs (cleanup. bat and Disk Cleanup) on his home office and Zillow computers in the fall of 2014. ‘This is not spoliation, er. Beardsley did not launch the programs with an intent to destroy evidence, but rather to remove the record of his visits to pornographic websites. See Opp. at 9-10, 19-20. At the time, Beardsley was not a party and had satisfied his obligations under the subpoena. See Opp. at 7. But, Beardsley understood these computers were likely to be turned over for searching and collection and/or forensic imaging in connection with this lawsuit. He did not want anyone to discover that he had frequented pom sites. He was mortified to think that others, including work colleagues and industry folks, would find out, Simply put, in running cleanup bat, he intended to eliminate traces of what he considered shameful internet activity. But this is not bad faith intent to destroy evidence. And he did not believe he had saved and then deleted any Move information from these computers, which he obtained only after he had left Move. He did not think cleanup.bat eliminated anything possibly relevant, because it only operates on already-deleted data.* These facts undermine any assertion that important evidence was lost as a result of running these programs. D. Any Loss of Evidence Has Not Prejudiced Plaintiffs. Plaintiffs’ motion depicts a sort of spoli ion apocalypse. Plaintiffs claim this is an “extreme case” and allege “unprecedented premeditated evidence destruction”. Plaintiffs allege, with no evidence, that “[t]he most important emails and text messages in the case are gone and cannot be recovered.” Reply at 2. And Plaintiffs claim that we can never know anything about the contents of missing devices or data without the data and devices themselves. * Disk Cleanup is distinguishable from cleanup.bat/Cipher because it does not wipe or permanently delete data. And, in fact, forensic analysis to date has not revealed evidence indicating data related to this litigation was deleted or otherwise affected by the launching of the Disk Cleanup program. * Plaintiffs recently have clamored about cleanup.bat being run on the home office computer in the summer of 2013. But, as they know but declined to disclose, this is immaterial. That device and every shred of data and ‘metadata and information on it was fully and entirely preserved through forensic imaging months earlier, on March 9, 2015 (before Beardsley was even added a a party to this lawsuit), and again on May 6, 2015 pursuant to the Special Master's May 11 order which set April 30 as the cut-off date for document collection. SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF - 8 Seattle, Washington 98101-2272 (206) 749.050018 19 ‘The rea . The actual evidence shows that there is no apocalypse y is far more pross and that we actually know quite a lot: the volume of what's missing is not so much and, also formation important, we know that much of what’s missing is not significant, Much of th that Plaintiffs claim was deleted is available—because, for example, someone else produced it or it has been forensically recovered. In short, more than enough exists to show that any loss of | information that did occur is not prejudicial to Plaintiffs: # Move has, in its archives, all emails to and from Beardsley’s Move email account from 2013 to the present. Peterson Decl. { 2. The Move emails Beardsley deleted from his Move laptop upon departure are not lost. © More than 98% of the 694 Dropbox documents that Beardsley deleted from his, Move laptop upon departure have been located by Defendants’ forensic expert. Burman Decl. Ex. B at 119. Plaintiffs claim an “unknown amount of additional data” that had been deleted was Jost because Beardsley ran Cipher on the Move laptop before departing. Plaintiffs’ forensic expert has identified this as material deleted in February 2014 and thereafter, totaling over 85,000 files and folders. Analysis of these deletions reveals ‘98% were non-user-generated type files (such as folders, system files and internet history) and only .16% was user-generated data (e.g., documents and pictures) that has not yet been located on other data sources (although it could be located on other Move computers in Plaintiffs’ exclusive possession). In sum, Plaintiffs’ vague assertions about the quantity and quality of deleted data are wildly overstated. (And, in any event, forensic analysis indicates that most of the data was overwritten, by the computer's TRIM program, which Move did not disable when it provided Beardsley with the computer, and not by anything Beardsley did.) © More than 700 texts that Beardsley deleted from his Move iPhone have been recovered. The recovered texts provide substantial insight into Beardsley’s texting history across the relevant timeframe and the likely content and flavor of any texts that are missing. © The SanDisk 32-GB thumb drive isn’t lost and never was. Beardsley reformatted it in April 2014, but substantial information from it has been recovered. Forensic evidence indicates that the device was never connected to the Zillow laptop or the family computer; only one file from it was opened on Beardsley’s home office computer; that file was not opened again after April 9, 2014. Crain Decl. 29. In other words, regardless of what was on this device before it was reformatted, forensics enable us to know what was opened and what was copied from it.” Importantly, the forensic evidence that provides the history of USB device connection appears complete on Beardsley's computers; that i, it extends back to when he first began using them, Plaintiffs nonetheless allege that Beardsley used a program called USBDeview to delete some USB device connection history from the family computer sometime between August 4 and 24, 2015. The forensic analysis, however, shows these allegations to eset Marve hey ere a hy Srna aes ged sa as ey DEFENDANT CURT BEARDSLEY'S PRE EVIDENTIARY faye Hace hems HEARING BRIED “9, Seattle, Washington 98101-2272 (206) 749.050018 19 © Regarding the Western Digital (°WD”) external hard drive that Beardsley discarded in 2014: Forensic evidence establishes that it was never connected to Beardsley’s Zillow laptop or the family computer; that after leaving Move the WD was connected to his home office computer only in late August and early September 2014; that the handful of documents opened at that time were personal (e.g., church related). Crain Decl. $7 25, 26. In other words, the forensic evidence establishes when and how the WD was used after he left Move, corroborates Beardsley’s testimony, and thus the loss of the WD is not prejudicial to Plaintiffs’ case. ‘© Forensic analysis indicates that the thumb drive Beardsley gave to his son was never connected to Beardsley’s Zillow laptop or any other of his computers after he left Move. Crain Decl. 30. So whatever was on that thumb drive is unimportant, because Beardsley never looked at it or copied it to a computer he used at Zillow. © Similarly, forensic analysis provides no evidence that files from the other missing thumb drive (5A device) were opened or copied from this device after Beardsley left Move. So nothing on that missing thumb drive is relevant. © Regarding the cleanup programs Beardsley launched on his home office computer: The forensic deletion analysis to date has not identified any evidence that Move- related documents were deleted from this computer, indicating that cleanup.bat did not eliminate traces of such documents. © Regarding cleanup.bat run on the Zillow laptop: forensic analysis indicates that most of the wiping resulted from the TRIM command, not Cipher / cleanup bat. Further, forensic analysis identified only one deleted document related to Beardsley’s Move employment — a generic presentation template. © Substantial internet history not subject to Cipher remains on the computers. It includes examples of visits to cloud storage accounts on both the home office and Zillow computers. Moreover, browser history on the computers provides only limited visibility into certain user activity; e.g., copying or deleting documents vi: DropBox.com and Google Drive does not create unique URLs that would be in the computer's browser history. Thus, internet history regarding visits to cloud storage accounts either remains or, if it was lost, mote probative evidence exists in the cloud storage service in many instances. ‘Forensic analysis confirms that the MLS spreadsheet was never opened on Beardsley’s Zillow computer. Crain Decl. { 29. Forensic evidence thus disproves the speculative testimony of Plaintifis’ marquee witness, the “whistleblower” Chris Crocker, and disproves Plaintiffs’ central misappropriation allegation against Beardsley. Compare Stephen Ex FF at 57, 77 with Crain Decl. 29. In short: contrary to Plaintiffs’ claim, we can and in fact do know a lot about “the most critical evidence in this case,” what was done (and not done) with it, and if it was deleted, reed (cing ioc ammo very Asp 42015, Acc ea Wy Belay ons Bin eva alos DEFENDANT CURT BEARDSLEY'S PRE EVIDENTIARY faye Hace hems HEARING BRIEF - 10 Seattle, Washington 98101-2272 (og wea18 19 whether that matters. And what we know shows that the spoliation claim lacks a real basis. Plaintiffs argue that Beardsley asks for a presumption that whatever is missing is not important. ‘That is incorrect. Rather, Beardsley relies on evidence that shows that what is mis ng is not important, Itis Plaintiffs who ask this Court to make a presumption rather than meeting their burden of proof, See Reply at 9-10, Plaintiffs must put forward “concrete evidence rather than fertile imagination” to establish that the access to missing information would produce evidence favorable to their case. Gates Rubber Co. v. Bando Chem. Indus., Ltd., 167 F.R.D. 90, 110 (D. Colo, 1996). Plaintiffs assume, for example, that data on the WD drive, or on the two missing thumb drives, would have helped their case. But the one and only reason they advance for asserting this is that these were at one time connected to the Move laptop—well short of what is requited to make the inference they request, especially when the actual evidence that is available (e.g., device connection histories, and what documents were opened and copied from these devices) indicates that the missing data was immaterial. Absent evidence that mis ing data would support Plaintiffs on a particular issue, spoliation sanctions should be denied. Automated Solutions Corp. v. Paragon Data Sys., Inc., 756 F.3d 504, 513-14 (6" Cir. 2014) (denying sanctions; plaintiff did not prove nexus between allegedly missing hard drives and development of software at issue in the case). FE. _ Spoliation Sanctions Are Not Warranted. As discussed above, Plaintiffs’ request for sanctions rests on the unproven and faulty assumptions that there was a scheme to steal trade secrets, that there was bad faith intent to is ma ive. destroy material helpful to Plaintiffs’ case, and that the volume of evidence los It rests, too, on the false premise that Beardsley violated a clear obligation to preserve evidence. See Opp. at 7. In Plaintiffs’ Reply, they asserted (for the first time, by releasing a document on which they'd claimed privilege for more than a year) that Beardsley was bound by what they describe as a “litigation hold notice” dated March 6, 2014, But the document does not reference any litigation of reason for its request to keep information about Samuelson, Reply at 4 (citing Kontonickas Decl. Ex A). When Beardsley deleted archived Move emails SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF I Seattle, Washington 98101-2272 (206) 749.050018 19 from his Move laptop on March 15, 2014, he (a) did not know that there would be litigation, much less what would be relevant (o it, (b) had not received a request from Move’s HR Director, Carol Brummer not to erase Move data from his Move-issued devices, and (c) believed all his Move emails were preserved on Move’s servers Finally, Plaintiffs’ request for sanctions rests on the false premise that Defendants misled this Court. Beardsley has timely produced documents; he voluntarily disclosed the disposal of the WD and the launching of the cleanup programs. He only opposed Plaintiffs’ request for unfettered access to electronic data containing possible privileged information, but consented to (indeed advocated for) both the discovery of electronic information and the appointment of the neutral. Opp. at 10-11 Plaintiffs’ request for extreme sanctions relies on extreme federal cases applying different standards than Washington. See Opp. at 22-24 (distinguishing Plaintiffs’ authorities and standards), But Washington law is clear that, to merit sanctions, Plaintiffs must yet prove bad faith intent and must establish that any missing evidence would have helped them on, particular issues in the case. See id, at 12-14 (Washington standards, citing Cook, 190 Wn, App. 448; Henderson, 80 Wn. App. 592). Further, the extreme sanctions Plaintiffs seek are not warranted under Washington law. See Opp. at 22-24.” As Plaintiffs’ counsel recently stated to this Court: “[I}t doesn’t really matter what the federal judges are saying about matters of Washington law when the Washington courts themselves have spoken to those issues.” Declaration of L. Castello, submitted herewith, Ex. A at 61:5-8. 7 Extreme sanctions are not warranted under federal law, either. Nucor Corp. v. Bell, 251 F.R.D. 191, 201-04 (D. S.C. 208 (ted by Pana dectnng to anerd-ekreme sanction of teal jut” on et ar more prego lat se Har tsa rkapsi pvtig rye deans whet Wafer ban 2 er eves sevataenenavarnas cena DEFENDANT CURT BEARDSLEY'S PRE EVIDENTIARY faye Hace hems HEARING BRIEF - 12 Seattle, Washington 98101-2272 (og wea18 19 25 26 7 DATED: April 1, 2016. SAVITT BRUCE & WILLEY LLP By__A/ James P. Savitt James P. Savitt, WSBA #16847 Michele L. Stephen, WSBA #39458 Dufly Graham, WSBA #33103 1425 Fourth Avenue, Suite 800 Seattle, WA 98101-2272 Email: jsavitt@sbwilp.com imstephen@sbwllp.com dgtaham@ sbwllp.com Attomeys for Defendant Curt Beardsley SAVITT BRUCE & WILLEV 11 DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY Te Poe di ceca ah HEARING BRIEF- 13, Seattle, Washington 98101-2272 (206) 749.05001 CERTIFICATE OF SERVICE 2 Thereby certify that on April 1, 2016, I served the documents described below: © DEFENDANT CURT BEARDSLEY’S PRE-EVIDENTIARY HEARING BRIEF * DECLARATION OF LESLIE CASTELLO. via e-filing and by email transmission at the email addresses provided to the following 7 || Jack M. Lovejoy, WSBA #36962 Lawrence R. Cock, WSBA #20326 8 || Cable, Langenbach, Kinerk & Bauer, LLP Suite 3500, 1000 Second Avenue Building '}] Seattle, WA 98104-1048 Telephone: (206) 292-8800 Facsimile: (206) 292-0494 11 ]] iloveioy @cabletang.com Ire@cablelang.com 12 }] kalbritton@cablelang.com |jpetersen@cablelang.com Attorneys for Plaintiffs 15 || Jeffrey I. Tilden, WSBA #12219 Jeffrey M. Thomas, WSBA #21175 16 || Michael Rosenberger, WSBA #17730 Mark Wilner, WSBA #31550. 1001 Fourth Avenue, Suite 4000 Seattle, WA 98154 Telephone: (206) 467-6477 19 |] Facsimile: (206) 467-6292 jtilden@ gordontilden.com 20 || jthomas@ gordontilden.com mrosenberger@ gordontilden.com mwwilner@ gordontilden.com 22 |] chudson@gordontilden.com 18 23 || Attorneys for Plaintiffs 24 }] Brent Caslin, WSBA #36145 Richard Lee Stone , (Pro Hac Vice) Nick G. Saros, (Pro Hac Vice) 96 | Jennifer Wagman Njathi, (Pro Hac Vice) Ethan A. Glickstein, (Pro Hac Vice) 27 || Jeffrey A. Atteberry, (Pro Hac Vice) SAVITT BRUCE & WHLLEY 11P 1425 Fourth Avenue Suite 800 Seattle, Washington 98101-2272 (206) 749.0500 CERTIFICATE OF SERVICE - 11 || AnnaMarie Van Hoesen (Pro Hac Vice) Amy M. Gallegos (Pro Hac Vice) 2}! John S. Lee (Pro Hac Vice) Christopher 8. Lindsay (Pro Hac Vice) Andrew J. Thomas (Pro Hac Vice) 4 |] Daniel A. Rozansky (Pro Hac Vice) David R. Singer (Pro Hac Vice) Jenner & Block LLP 633 West Sth Street, Suite 3600 ©] Los Angeles, CA 90071 7 || Telephone: (213) 239-5150 Facsimile: (213) 539-5199 8 |] beastin@jenner.com stone @jenner.com 9 || nsaros@jenner.com njathi@jenner.com eglickstein@jenner.com 11 || datteberry @jenner.com avanhoesen@ jenner.com 12 || agallegos@jenner.com jslee@jenner.com 13 || lindsay @jenner.com ajthomas@ jenner.com drozansky @ jenner.com 15 || dsinger@jenner.com eward@jenner.com 16 Attorneys for Plainti 7 1g |] Mary P. Gaston, WSBA #27258 Susan E. Foster, WSBA #18030 19 || Kathleen M. O'Sullivan, WSBA #27850 Judith B. Jennison, WSBA #36463 20 |] David J. Burman, WSBA #10611 Katherine G. Galipeau, WSBA # 40812 21! Ulrike B. Connelly, WSBA #42478 Joseph M. McMillan, WSBA #26527 David A. Perez, WSBA #43959 2 |] Perkins Coie LLP 1201 Third Avenue, Suite 4900 24 || Seattle, WA 98101-3099 ‘Telephone: (206) 359-8000 251! Facsimile: (206) 359-9000 96 || Measton@ perkinscoie.com sfoster@perkinscoie.com 27 || kosullivan@perkinscoie.com > SAVITT BRUCE & WILEY 11r CERTIRICATROF SERYICE-2, 1425 Fourth Avenue Suite 800 Seatde, Washingeon 98101-2272 (206) 749.05001 | jiennison@ perkinscoie.com dburman@perkinscoie.com 2 || kgalipeau@perkinscoie.com 4 |] uconnelly @perkinscoie.com memillan@ perkinscoie.com 4|| dperez@ perkinscoie.com ejbrown@ perkinscoie.com swyatt@ perkinscoie.com bearranza@perkinscoie.com 7 || Attorneys for Defendant Zillow, Inc. 8 || Clemens H. Barnes, Esq., WSBA #4905 Estera Gordon, WSBA #12655 9 || Brian W. Esler, WSBA #22168 K. Michael Fandel, WSBA #16281 Miller Nash Graham & Dunn LLP 11 || Pier 70, 2801 Alaskan Way, Suite 300 Seattle, WA 98121-1128 12 || Telephone: (206) 624-8300 Facsimile: (206) 340-9599 13 || clemens.barnes@millernash.com estera.gordon@millermash.com brian.esler@millernash.com 15 || michael fandel@millemash.com robert.mittenthal @ millernash.com 16 |] kelly.hamilton@millernash.com connie.hays@millernash.com 17 || gill fadaie@millernash.com 181! Attormeys for Defendant Errol Samuelson » 20 I declare under penalty of perjury under the laws of the State of Washington that the 21 |] foregoing is true and correct. 2 DATED on April 1, 2016 at Seattle, WA. 2B 4 25 ‘eslie M. Castello 26 27 Ch SAVITT BRUCE & WILEY 117 CERTIFICATE OF SERVICE -3 1425 Fourth Avenue Suite 800 Seattle, Washington 98101-2272 (206) 749.0500