A litigation hold is a directive from an organization’s legal team ordering the preservation of any information that could be relevant to a current or anticipated lawsuit. It overrides normal company policies for deleting emails, recycling files, or shredding paper, and it stays in place until the legal matter is fully resolved. Also called a legal hold, it can last years, and ignoring it can lead to court sanctions severe enough to decide a case.
When the Duty to Preserve Begins
The obligation to preserve evidence does not start when a lawsuit is filed. It begins the moment an organization “reasonably anticipates” litigation, and that phrase catches more situations than people expect.
A formal complaint or summons is the obvious trigger. But a demand letter from an opposing attorney, a notice of a government investigation, a regulatory complaint, or a serious workplace incident where legal action is foreseeable can all start the clock. If a company’s general counsel can look at the situation and reasonably conclude that a lawsuit is coming, the preservation duty has already attached.
This is where organizations get into trouble. The duty exists whether or not anyone has issued a formal hold notice. If a company knows litigation is likely and lets routine document destruction continue, that failure alone can become the basis for sanctions. The hold notice is the mechanism for acting on the duty. It is not what creates the duty.
What a Litigation Hold Covers
The scope follows the subject matter of the anticipated case, and it is usually broad. The hold notice describes the relevant topics, time periods, and types of information you need to keep. When in doubt about whether something falls within scope, preserve it. That call is not yours to make alone.
Electronic Data
Most modern holds target electronically stored information: emails, text messages, voicemails, documents on company servers or laptops, spreadsheets, databases, and calendar entries. The reach extends to workplace collaboration platforms like Slack and Microsoft Teams. Employees often treat those messages as informal and forgettable. Courts treat them as discoverable evidence.
Ephemeral and Disappearing Messages
Apps that automatically delete messages after a set period create a particular problem. The FTC and DOJ issued updated guidance in 2024 making clear that preservation obligations apply fully to ephemeral messaging platforms, including tools like Signal that are specifically designed to make messages disappear. The agencies warned that failure to preserve these communications could result in obstruction of justice charges in the context of government investigations.1Federal Trade Commission. FTC and DOJ Update Guidance That Reinforces Parties’ Preservation Obligations for Collaboration Tools and Ephemeral Messaging If you use any auto-delete app for work conversations, a hold means you need to disable that feature immediately for anything within scope.
Personal Devices
A hold does not stop at company-issued hardware. If you use a personal phone, tablet, or laptop for work communications, the data on those devices falls within reach. Many organizations now require employees to sign BYOD policies granting the company the right to access and collect business-related data from personal devices, precisely because of this preservation risk. Whether your employer can compel you to hand over a personal device depends on your employment agreement and applicable privacy laws. At a minimum, you are expected not to delete any work-related content from it while the hold is active.
Physical Records and Third-Party Data
Paper is covered too: handwritten notes, printed reports, memos, contracts, appointment books. The format does not matter.
The hold can also extend to data held by third-party vendors or cloud providers. When an organization stores information with an outside provider, the legal team typically sends a separate preservation letter to that vendor directing it to suspend automatic destruction and retain metadata. An organization cannot shift blame for lost evidence by pointing at a vendor it failed to notify.
What To Do When You Receive a Hold Notice
If a litigation hold notice lands in your inbox, the job is simple in concept and demanding in practice: stop destroying anything that could be relevant, and do it now.
Read the notice carefully. It should identify the legal matter, describe the categories of information to preserve, and specify the time period. If your email system or any other platform automatically deletes messages after a set number of days, that auto-deletion must be suspended for your accounts. Do not wait for IT if you can turn it off yourself.
The notice will likely require you to sign an acknowledgment confirming you received it and understand your obligations. Take this seriously. A signed acknowledgment you later ignore is powerful evidence against you if a dispute arises over whether documents were properly preserved.
After the initial preservation step, you may be asked to participate in a custodian interview or fill out a questionnaire. The legal team uses these to map where relevant data actually lives. Expect questions about your email accounts, file storage habits, which devices you use for work, which collaboration tools or messaging apps you use, and whether you keep paper files. Answer thoroughly. Overlooked data sources are one of the most common causes of accidental spoliation.
If anything in the notice is unclear, ask your legal department. Do not guess at the scope and assume you got it right.
How Organizations Put a Hold in Place
From the organization’s side, issuing a hold is a multi-step process that goes well beyond sending an email.
The legal team identifies the key custodians: people most likely to possess relevant information based on their roles and involvement with the subject matter. That list often starts narrow and expands. The team then maps the data sources tied to those custodians, including email archives, shared drives, local hard drives, collaboration platforms, personal devices, and third-party systems.
Once custodians and sources are identified, the hold notice goes out, acknowledgments are collected, and reminders follow. Holds that run for years tend to fade from people’s memory, so periodic follow-up is one of the strongest defenses against a later claim of negligent preservation.
IT works alongside legal to suspend auto-deletion on relevant accounts, image or snapshot relevant systems, and ensure backup tapes or archives covering the period are not overwritten. In many organizations, having IT handle preservation directly is safer than relying on individual employees.
When a Custodian Leaves
When an employee under an active hold leaves, the hold does not leave with them. The departing employee’s data, including email, files, and anything on company-issued devices, must be preserved before accounts are deactivated or equipment is reassigned. Federal agencies treat this as a specific procedural requirement: managers must assess whether a departing employee is a custodian on any active hold and coordinate with legal and IT to preserve that person’s data before the departure is finalized.2Department of Health and Human Services. Department of Health and Human Services Policy for Litigation Holds The same principle applies in the private sector. Losing a custodian’s data because no one flagged the departure is one of the more avoidable preservation failures, and courts have little sympathy for it.
What Happens If Evidence Is Not Preserved
Destroying or losing evidence you were supposed to keep is called spoliation. Courts take it seriously because the litigation system depends on both sides having access to relevant evidence.
The Two-Tier Federal Standard
Federal Rule of Civil Procedure 37(e) creates a two-tier framework for sanctions when electronically stored information is lost. Both tiers share the same threshold: the ESI should have been preserved, a party failed to take reasonable steps to preserve it, and the information cannot be recovered through other discovery.3Legal Information Institute. Federal Rules of Civil Procedure Rule 37 – Failure to Make Disclosures or to Cooperate in Discovery; Sanctions
Under the first tier, if the loss prejudices another party, the court can order measures “no greater than necessary to cure the prejudice.” That might mean reopening discovery, allowing additional depositions, or shifting costs. The remedy must be proportional to the harm.
The second tier is reserved for bad actors. Only when a court finds a party acted with the intent to deprive the other side of the evidence can it impose the most severe sanctions: presuming the lost information was unfavorable, instructing the jury to assume the same, or dismissing the case or entering a default judgment outright.3Legal Information Institute. Federal Rules of Civil Procedure Rule 37 – Failure to Make Disclosures or to Cooperate in Discovery; Sanctions “Intent to deprive” is a high bar, but organizations that ignore a hold or selectively destroy documents after receiving one have a hard time arguing they lacked intent.
Adverse Inference Instructions
The adverse inference instruction is the most commonly imposed spoliation sanction. A Federal Judicial Center study found that when a sanction was imposed for spoliation of electronically stored information, an adverse inference instruction was granted 57% of the time.4Federal Judicial Center. Motions for Sanctions Based Upon Spoliation of Evidence in Civil Cases In practice, the judge tells the jury it can assume whatever was destroyed would have hurt the party that destroyed it. Even if the rest of your case is solid, that instruction can be devastating at trial.
Consequences for Individual Employees
Sanctions from a court fall on the organization, but individual employees who ignore a hold face their own consequences. Deleting files or emails after receiving a notice is a policy violation that can result in discipline up to and including termination. In government investigations, as the FTC and DOJ guidance makes clear, intentional destruction of evidence can escalate to criminal obstruction charges.1Federal Trade Commission. FTC and DOJ Update Guidance That Reinforces Parties’ Preservation Obligations for Collaboration Tools and Ephemeral Messaging The stakes are personal, not just something the company’s lawyers worry about.
When the Hold Ends
A litigation hold stays in effect until the legal department issues a formal release, typically after the underlying matter is fully resolved through settlement, judgment, or dismissal, and any appeal periods have expired. Do not assume the hold is over because you heard the case settled. Wait for the written release.
Once lifted, the organization reverts to its standard document retention policies. IT and compliance teams decide what should be archived under normal schedules and what can be deleted. If multiple holds overlap on the same data, releasing one does not free that data if another still covers it. Do not make independent decisions about deleting previously held material without confirmation from legal that every applicable hold has been released.