ESI preservation was front and center in PharmacyChecker.com LLC v. National Association of Boards of Pharmacy (S.D.N.Y. Sept. 25, 2025), where the Court addressed sanctions for failure to preserve electronically stored information (ESI) in an antitrust case. PharmacyChecker, which compares prescription drug prices online, alleged that NABP’s “Not Recommended Sites” list unlawfully reduced its search visibility in search engines. During discovery, the Court found that PharmacyChecker failed to preserve detailed website traffic data from Google’s Universal Analytics platform after Google announced its retirement. Although some reports were saved, the company lost 19 months of key “granular” data showing search engine traffic from Google and Bing. Interestingly, Plaintiff PharmacyChecker did successfully download the requisite granular data for other months during the relevant time period. However, the court found that the IT professional employee tasked with downloading the data was not supervised by an attorney and did not do enough to preserve the data to support its claims, despite the knowledge that the Google platform was being retired.
NABP moved for sanctions under Rule 37(e), arguing that the plaintiff negligently allowed relevant ESI to be destroyed. The Court agreed, finding that PharmacyChecker knew the data’s importance and had adequate notice to preserve it but failed to take reasonable ESI preservation steps. The Court stressed that counsel must actively oversee ESI preservation and cannot delegate the responsibility to technical staff without supervision. In siding with the Plaintiffs and awarding sanctions, the Court was also careful to highlight that sanctions under Rule 37(e) are “heavily dependent on the facts, circumstances, and context of the litigation” and “subject to interpretation in the context of specific litigation.”
While the Court found the loss prejudicial, it ruled that the conduct did not amount to bad faith and limited the sanctions accordingly. NABP was allowed to present evidence of the missing data at trial, request a jury instruction explaining the loss, and recover reasonable fees related to the sanctions motion.
The decision highlights the duty to preserve relevant ESI once litigation is foreseeable. Even negligent failures can result in sanctions when critical data is lost, reinforcing that parties must act promptly and carefully to safeguard electronic evidence throughout discovery and prioritize ESI preservation.
Reach out to Caitlin Oyler, Counsel at CODISCOVR. Caitlin has over a decade of experience providing high-level advice to clients regarding all phases of the eDiscovery life cycle and managing high-profile document collections, reviews, and productions.
