When a legal dispute begins to take shape, most people focus on strategy, exposure, and outcomes. Far fewer realize that how documents and data are handled in the earliest moments of a dispute can determine the result of the case itself.
That is where a litigation hold—also called a document hold—comes in.
What Is a Litigation Hold?
A litigation hold is a formal instruction to preserve documents and information that may be relevant to a legal dispute.
It applies to paper documents, emails, text messages, electronic files, and other electronically stored information. The purpose is simple: once a dispute is reasonably anticipated, potentially relevant information must be preserved, not deleted, altered, or overwritten.
A litigation hold is not a technicality. It is the mechanism courts expect parties to use to comply with their preservation obligations.
When Does the Obligation to Preserve Begin?
A common misconception is that preservation duties begin only after a lawsuit is filed. That is incorrect. The obligation to preserve documents arises when litigation is reasonably anticipated. This may occur when:
- A demand letter or breach letter is received
- A dispute escalates to the point where legal action is threatened
- A termination, separation, or ownership dispute is foreseeable
- A trust or estate conflict becomes likely
At that point, routine document deletion policies must be suspended and a litigation hold put in place. Waiting until a complaint is filed can be too late.
Who Has Preservation Obligations?
Preservation obligations apply broadly and can affect:
Businesses
Companies must preserve documents and data held by:
- Executives and decision-makers
- Employees involved in the dispute
- IT systems, shared drives, and backups
Deletion policies, auto-delete email settings, and routine data cleanup must be suspended for relevant information.
Executives and Professionals
Senior executives, partners, and fiduciaries often control critical communications and records. Their emails, texts, drafts, and personal devices used for business may all be subject to preservation.
Individuals
Individuals involved in employment, matrimonial, trust, or estate disputes have the same obligation as in business disputes to preserve relevant information—whether stored on a work computer, personal phone, cloud account, or home device. Preservation duties are not limited to corporate environments.
What Must Be Preserved?
A litigation hold must be broad, but specifically tailored.
That means preserving:
- Emails and attachments
- Text messages and messaging app communications
- Electronic documents and drafts
- Financial records
- Records stored on laptops, phones, tablets, USB drives, and cloud services
At the same time, the hold must identify specific categories of information relevant to the dispute. Courts have made clear that vague instructions to “preserve everything” are not enough if important data sources are not identified.
Why Written Litigation Holds Matter
Courts expect litigation holds to be written, not informal or verbal.
A written hold:
- Creates a clear record of what must be preserved
- Identifies who is responsible for compliance
- Serves as evidence that reasonable preservation steps were taken
Well-drafted litigation holds are typically concise, written in plain language, and require recipients to acknowledge receipt and compliance.
The Consequences of Getting It Wrong
Failure to properly implement a litigation hold can have serious consequences, including:
- Court-ordered sanctions
- Adverse inferences at trial
- Loss of credibility
- Compelled disclosure of litigation-related communications
Even deleting documents under a normal retention policy can be problematic once litigation is reasonably anticipated.
Preserving paper copies of electronic documents may also be insufficient if the underlying electronic data is destroyed.
How Long Does the Duty to Preserve Last?
Another misconception is that preservation duties end when a case settles or is dismissed.
In reality, preservation obligations may continue beyond the conclusion of a case if related litigation is reasonably foreseeable. Courts have recognized that disputes can “come back to life” in different forms, involving different parties, or arising from the same underlying facts. A litigation hold remains in place until it is formally released.
Why Early Legal Guidance Is Critical
Litigation holds sit at the intersection of legal strategy, technology, and risk management. They are easy to underestimate—and costly to mishandle.
Whether you are a business owner facing a contract dispute, an executive navigating an employment separation, or an individual involved in a matrimonial or trust-and-estate conflict, early legal guidance on preservation obligations can protect both your case and your reputation. Handled properly, a litigation hold is a shield. Handled poorly, it can become the centerpiece of the dispute itself.
With offices in Albany, Buffalo, Rochester, New York City, we can help clients across New York State.
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This blog post is for informational purposes only and does not constitute legal advice. For specific legal counsel, please contact our office directly.