DOJ and FTC Update Preservation Specifications for Second Requests



What’s changing

On January 26, 2024, the Department of Justice (DOJ)’s Antitrust Division and the Federal Trade Commission (FTC) announced updated language within their standard antitrust preservation specifications that reinforces a company’s duty to preserve data from collaboration and ephemeral messaging platforms during the pendency of antitrust investigations.

The updated language now specifically includes ephemeral messaging and other methods of group and individual communication—including Microsoft Teams, Slack, and Google Chat messages—within the definition of “messaging application.” The language applies to messaging application data preservation requirements in Second Requests, voluntary access letters, and compulsory legal processes—including grand jury subpoenas.

Deputy Assistant Attorney General Manish Kumar of the Justice Department’s Antitrust Division warned:

“The Antitrust Division and the Federal Trade Commission expect that opposing counsel will preserve and produce any and all responsive documents, including data from ephemeral messaging applications designed to hide evidence. Failure to produce such documents may result in obstruction of justice charges.”

Director Henry Liu of the FTC Bureau of Competition reiterated the obligation, stating:

“Today’s update reinforces that this preservation responsibility applies to new methods of collaboration and information sharing tools, even including tools that allow for messages to disappear via ephemeral messaging capabilities.”

What this means for law firms representing companies in M&A legal actions

January’s update for antitrust actions is part of a broader pattern of heavy scrutiny by government regulatory agencies around how corporations preserve, handle, and use data from third-party messaging applications. This scrutiny is unlikely to change as messaging applications become more widely used for company communication and collaboration platforms become more complex.

Thus, law firms should be counseling companies to:

1. Review policies and procedures around data retention, legal hold, and acceptable use of communications platforms. They should consider whether they comport with this updated language, recent case law admonishing certain corporations for failing to adequately preserve short-term communications, and emerging industry standards.

2. Evaluate current compliance posture, including whether the company has a program in place to monitor compliance with these policies and ensure there are adequate controls to support the retention and preservation of data.

3. Consider implementing a quarterly training program to remind employees of their obligations under these policies and procedures and potential consequences, if not followed.  

When representing companies in M&A matters, law firms should inquire about the specific retention and deletion policies in place, as well as confirm that steps have been taken to preserve data residing in the company’s messaging applications for relevant users. This potentially includes data that might reside on a mobile phone (personal or company-issued device), such as a third-party application that might not be stored on the company network (e.g., Telegram, WhatsApp, or even SMS/iMessage)—which will add some complexity to preservation.

[View source.]

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