We use cookies to improve security, personalize the user experience,
enhance our marketing activities (including cooperating with our marketing partners) and for other
business use.
Click "here" to read our Cookie Policy.
By clicking "Accept" you agree to the use of cookies. Read less
What is a Litigation Hold and Why Is It Crucial for Legal Compliance?
Definition & Meaning
A litigation hold, also referred to as a preservation order, is a legal directive that temporarily halts a company's usual document destruction policies. This order is essential when a company anticipates litigation or is involved in a legal dispute. It requires the preservation of all documents and data that may be relevant to the case, ensuring that these materials are available for the discovery phase of the litigation process.
Table of content
Legal Use & context
Litigation holds are commonly used in various legal contexts, including civil, criminal, and family law cases. When a company becomes aware of pending or potential legal action, it must implement a litigation hold to comply with legal obligations. This process often involves notifying employees about the importance of preserving relevant documents and may require the use of legal templates or forms to formalize the hold.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: A company receives a complaint regarding a breach of contract. Upon receiving this complaint, the company issues a litigation hold to ensure all related documents, emails, and communications are preserved.
Example 2: A business learns that a former employee is planning to file a lawsuit for wrongful termination. The company immediately implements a litigation hold to safeguard all records related to the employee's tenure and termination (hypothetical example).
State-by-state differences
Examples of state differences (not exhaustive):
State
Litigation Hold Requirements
California
Requires immediate implementation upon notice of potential litigation.
New York
Mandates that all relevant documents be preserved once litigation is anticipated.
Texas
Similar to other states, but emphasizes the need for clear communication to employees.
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
Comparison with related terms
Term
Definition
Key Differences
Litigation Hold
A directive to preserve documents relevant to anticipated litigation.
Specific to preserving evidence for legal cases.
Document Retention Policy
A policy outlining how long documents should be kept.
Focuses on routine management of documents, not on preservation for litigation.
Preservation Order
A court order requiring the preservation of evidence.
Can be issued by a court, while a litigation hold is typically self-imposed by a company.
Common misunderstandings
What to do if this term applies to you
If you find yourself in a situation where a litigation hold applies, take the following steps:
Notify relevant employees immediately about the hold and the importance of preserving documents.
Review and suspend your document retention policy to ensure compliance.
Consider using US Legal Forms to access ready-to-use legal templates for issuing a litigation hold.
If the situation is complex, consult with a legal professional for tailored advice.
Find the legal form that fits your case
Browse our library of 85,000+ state-specific legal templates.