Tuesday, October 7, 2008

A lesson in avoiding disaster

In a recent court case, Southern New England Telephone Co. v. Global NAPS, Inc., deliberate destruction of computer files, along with other discovery violations, lead to a $5.2 million judgment against the defendant. Basically, someone had used a program to delete files from company computers when they shouldn’t have and it cost them. How can you avoid this type of multi-million dollar disaster? It would appear that this defendant either did not know what type of software was installed on their computers and who could run it, or they failed to clearly document when it could not be used, or both. Your company needs to have both Retention and Legal Hold policies clearly explaining what records need to be retained to comply with retention laws and what information needs to preserved for imminent audits or litigation. Also, if your employees are using data “cleansing” software, you should control its use through policy, at a minimum. Do you have a plan to protect your computer data if you are involved in a lawsuit? Does your plan (usually called a Legal Hold) clearly prohibit an employee from deleting or altering your computer data and set forth dire consequences if they don’t follow the plan? It should!

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