Google is facing a catastrophic setback in its antitrust case, with the judge sanctioning the company for deleting evidence.

Google is facing a multidistrict antitrust suit over how it manages its Android ecosystem. The plaintiffs, including states’ district attorneys, have maintained that Google intentionally destroyed chats that it had a legal obligation to preserve by setting its systems to automatically delete chats after 24 hours.

In one of the most damning pieces of evidence, the plaintiffs submitted a chat in which CEO Sundar Pichai moved a conversation from a history-on chat to a history-off chat, allegedly to ensure there would be no record of the relevant communication.

It seems the Court agrees with the plaintiffs, with U.S. District Judge James Donato sanctioning Google (via Reuters):

During discovery in this multidistrict litigation (MDL) case, plaintiffs obtained information indicating that Google did not adequately preserve communications that were exchanged internally on its Chat message system. Plaintiffs say that this shortfall was intentional and deprived them of material evidence. They have requested sanctions under Federal Rule of Civil Procedure 37(e). Dkt. No. 349.1 After substantial briefing by both sides, and an evidentiary hearing that featured witness testimony and other evidence, the Court concludes that sanctions are warranted.

Judge Donato also calls out specific instructions and training Google employees were given to protect their communication and to make it difficult for them to ever be used in a legal setting. One such strategy included using no-history Google Hangouts chats. Another strategy revolved around including a lawyer’s name in the list of addresses an email is sent to to, effectively making the email “protected by the attorney-client privilege.”

Judge Donato’s decision then asks and answers if Google did enough to preserve communications for the legal proceedings:

The record establishes that Google fell strikingly short on that score. Several aspects of Google’s conduct are troubling. As Rule 37 indicates, the duty to preserve relevant evidence is an unqualified obligation in all cases. The Court’s Standing Order for Civil Cases expressly spells out the expectation that “as soon as any party reasonably anticipates or knows of litigation, it will take the necessary, affirmative steps to preserve evidence related to the issues presented by the action, including, without limitation, interdiction of any document destruction programs and any ongoing erasures of e-mails, voice mails, and other electronically-recorded material.” Standing Order for Civil Cases Before Judge James Donato.

Google clearly had different intentions with respect to Chat, but it did not reveal those intentions with candor or directness to the Court or counsel for plaintiffs. Instead, Google falsely assured the Court in a case management statement in October 2020 that it had “taken appropriate steps to preserve all evidence relevant to the issues reasonably evident in this action,” without saying a word about Chats or its decision not to pause the 24-hour default deletion. Case No. 20-5761, Dkt. No. 45 at 11. Google did not reveal the Chat practices to plaintiffs until October 2021, many months after plaintiffs first asked about them. See Dkt. No. 429 (Google’s response to Court’s questions) at 3 (“Google informed Plaintiffs on October 21, 2021, that it had not suspended the 24-hour retention policy for history ‘off’ chats.”). The Court has since had to spend a substantial amount of resources to get to the truth of the matter, including several hearings, a two-day evidentiary proceeding, and countless hours reviewing voluminous briefs. All the while, Google has tried to downplay the problem and displayed a dismissive attitude ill tuned to the gravity of its conduct. Its initial defense was that it had no “ability to change default settings for individual custodians with respect to the chat history setting,” Dkt. No. 427-3 ¶ 25, but evidence at the hearing plainly established that this representation was not truthful.

The judge expressed concerns that he did not want the entire case to hang on some deleted chats but did say Google should pay the plaintiffs’ attorneys’ fees and costs as a monetary sanction.

As to whether Judge Donato will issue an adverse jury instruction based on the finding, he wants to wait until the end of fact discovery to see the “state of play” and better determine how much the destroyed evidence has damaged the plaintiffs’ case.