AMD v. Intel Part Three: Costly Remediation In Restoring Lost Email And Other ESI

Posted by Gregg Mayer on Friday, March 28th, 2008   

Read Part One in this three-part series about the ongoing AMD v. Intel litigation. 

Read Part Two here.   

In this third part, we look at the ways Intel proposed to restore the missing ESI, including the multimillion dollar remediation plan.

By the time Intel filed it Remediation Plan to recover lost email, it estimated it had already spent approximately $3.3 million in outside vendor costs in its efforts to restore back-up tapes. Intel estimated it would spend “millions more” to complete all of the remediation.

According to Intel’s Remediation Plan:

Intel is cataloging, indexing and, to the extent appropriate, restoring thousands of backup tapes. Intel is willing to undertake this massive effort because it regrets the lapse in its retention practices, wants to set them right, and wishes to get the case back on the path to being resolved on the merits.

Intel is relying on “complaint freeze tapes” and “weekly backup tapes” in its efforts to restore as much of the data as possible. Intel concedes, however, that not all of the information lost due to the problems with the litigation hold will be retrieved.

In its efforts to avoid sanctions, Intel proposed the following remediation:

It re-issued its litigation hold notice, and will send out reminders every six months

Intel is also calling by telephone all 1,023 custodians to verbally remind them of the litigation hold

The legal department will have the say-so over whether any laptops in the future can be scrubbed

Intel will harvest and re-harvest all ESI from custodians working for Intel

Intel utilized an email archive company to capture all of the email from the custodians as a way to retain all relevant email

AMD has argued that Intel has not been forthright about the amount of data lost; however, AMD supported Intel’s decision to move ahead with its remediation plan.

No final cost is determined, but it will likely be in the tens of millions. Intel describes it as a “perhaps unprecedented” amount of resources to implement the Remediation Plan. AMD argues no matter how much Intel spends, that’s not an indicator of how much was lost because some data will be irretrievably gone.

AMD has said:  

Any honest assessment of this fiasco requires Intel to acknowledge that it cannot remediate the irremediable.

The court approved Intel’s plan on October 22, 2007.

Potential sanctions from the court – including a spoliation finding – still loom, despite Intel’s efforts to restore the data. In the court’s order approving the Remediation Plan, the court states:

(A)lthough [plaintiffs] acknowledge that Intel’s Proposed Remediation Plan contains all elements that should reasonably be required of Intel under the circumstances to remediate its documents preservation lapses, Plaintiffs do not acknowledge or concede that Intel’s Proposed Remediation Plan, even if fully executed, will effectively or substantially remediate Intel’s lapses, and for which lapses Plaintiffs specifically reserve the right to seek sanction.

In short, after discovery ends, AMD may – likely will – move for sanctions against Intel, including asking for an adverse inference instruction to be given to the jury. As has been forewarned by the Zubulake case, an adverse jury instruction could result in a multimillion dollar verdict. That remains to be seen for AMD v. Intel.

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