Implementing U.S.-Style Legal Holds in Foreign Jurisdictions

The following article is a summary of the full practice note, available to Practical Guidance subscribers by following this link. Not yet a Practical Guidance subscriber? Sign up for a free trial here.

The complete practice note is written by Laurel F. Grass of Leech Tishman.

This practice note explains how legal teams can implement cross-border legal holds when potentially relevant data and custodians are located in multiple jurisdictions. It addresses the U.S. duty to preserve relevant evidence once litigation is reasonably anticipated and explains how that duty may conflict with foreign privacy, employment, data-transfer, data-localization, and confidentiality laws.

U.S. Preservation Duties and Electronically Stored Information (ESI)

The practice note identifies Zubulake v. UBS Warburg LLC as the foundation of the modern litigation hold and explains that once litigation is reasonably anticipated, a party must suspend routine document retention and destruction practices and preserve relevant information. This duty is enforceable under the Federal Rules of Civil Procedure, including Rule 37(e).

The note next addresses ESI, including email, instant messages, documents, databases, mobile devices, cloud systems, and similar sources. Because ordinary retention policies are insufficient once preservation duties arise, legal teams must identify key custodians and likely sources of relevant ESI and tailor the legal hold accordingly. This process is particularly challenging for multinational organizations, where data may be dispersed across systems, countries, and custodians.

Cross-Border Conflicts and Local Law Constraints

The practice note explains that U.S. preservation obligations are broad when compared with practices in many other jurisdictions. The note identifies common conflict areas, including privacy laws, data-localization requirements, blocking statutes, sector-specific confidentiality laws, and labor or works-council requirements. Particular attention is given to the EU GDPR and UK GDPR.

Executing and Scoping a Defensible Cross-Border Legal Hold

The practice note outlines practical steps for executing a defensible cross-border legal hold. A legal hold is triggered when litigation, including regulatory inquiries or threatened claims, is reasonably anticipated. The scope of preservation is governed by possession, custody, or control, relevance, and proportionality. To implement a proportionate hold, legal teams must identify relevant custodians and data sources, including employees, former employees, vendors, local servers, cloud systems, mobile devices, collaboration platforms, and messaging tools.

For jurisdictions with strict data-localization laws, such as China and Russia, the note recommends considering localized review, anonymization or pseudonymization before export, approved transfer mechanisms, or localized ESI processing with remote attorney access. The note stresses the importance of maintaining a defensible audit trail.

Notice, Communication, Monitoring, and Release

Hold notices should clearly explain custodians’ preservation obligations and should be concise, understandable, and tailored to local employment and privacy laws. In multinational matters, notices may need translated or localized versions and should avoid over-collection by defining a proportional scope.

The note also recommends ongoing communication and follow-up with custodians. Coordination with HR and IT is also emphasized. HR can assist with identifying key custodians and monitoring labor-law compliance, while IT can identify systems, applications, backup tapes, and other sources of relevant ESI.

Finally, the practice note emphasizes the importance of maintaining, monitoring, and documenting the hold throughout its lifecycle. Cross-border holds require continuous oversight because mistakes may result in U.S. spoliation sanctions or foreign regulatory penalties. Legal teams should maintain a defensible audit trail of preservation actions, analyses, transfer decisions, and custodian communications. When the duty to preserve ends, organizations should formally release the hold and resume ordinary retention and destruction practices in compliance with applicable local privacy and data-retention laws.

The above article is a summary of the full practice note, Implementing U.S.-Style Legal Holds in Foreign Jurisdictions, which is available to Practical Guidance subscribers by following this link.

Practical Guidance subscribers may access the full practice note here. Not yet a Practical Guidance subscriber? Sign up for a free trial here.