What does Litigation Hold mean? Read on to discover the definition & meaning of the term Litigation Hold - to help you better understand the language used in insurance policies.
May be issued to preserve all documentation related to a lawsuit or potential lawsuit in an effort to avoid spoliation of evidence. This includes electronic records and product complaints, whether they are paper-based documents or electronically stored information (ESI). A litigation hold may be issued by the manufacturing/service company's attorney or by the manufacturing/service company internally and requires the data in question is to be protected so that it is accessible for the discovery process during litigation. If the company loses or destroys key documents tangible or electronic courts may rule that there is an automatic inference that the materials would have been unfavorable to the defendant. Furthermore, a company may have to pay penalties, including monetary fines and reimbursement of the opposing party's litigation costs, if it does not comply with a litigation hold. Also called "preservation order" or "hold order."
We hope the you have a better understanding of the meaning of Litigation Hold.