In December 2014, a federal judge here in Atlanta sanctioned Wal-Mart Stores Inc.for destroying evidence in an employee discrimination case. The sanction was two fold: (1) Wal-Mart was ordered to pay $19,980.00 in attorney’s fees to the employee’s attorney; and (2) the federal judge held that if the case proceeded to a jury trial the jury would be instructed to presume that Wal-Mart terminated the employee in retaliation for the employee filing a claim of discrimination with the Equal Employment Opportunity Commission.

Yes, you read that right. The federal judge decided that Wal-Mart’s conduct was so egregious he ordered that if the case proceeded to a jury trial he would instruct the jury that Wal-Mart had engaged in illegal retaliation. The only issue, at that point, for the jury to consider would be what amount of damages should be awarded.

Not surprisingly, given this ruling by the judge, the parties have now entered into a confidential settlement.

So, what did Wal-Mart do to deserve this drastic sanction?

Here’s the chronology of events according to the employee’s Motion for Sanctions for Spoliation of Evidence he filed with the Court:

According to the documents filed with the court, Wal-Mart’s video surveillance system regularly taped over the videotapes in the cameras unless action was taken to stop that process. It is undisputed that neither the Store Manager nor anyone from the Human Resources department took the necessary steps to preserve the video tape.

In reading the court filings in this case, including the sworn deposition testimony of the Store Manager, it seems that at least one explanation for why Wal-Mart failed to take steps to preserve the video tape was that he didn’t think that there was going to be any dispute about whether or not the gate was left unlocked. If you believe his deposition testimony, he says that Abdulahi admitted he had left the Garden Center gate unlocked.

But it turns out that Abdulahi denied he left the Garden Center gate unlocked when he was questioned under oath during his deposition in the federal lawsuit.

So how could Wal-Mart have avoided this court sanction and what should other business leaders takeaway as the lessons learned from this case? I contacted James Radford, the attorney who represented the employee in this case, and he shared the following lessons for employers:

In addition to the lessons suggested by James, I would add the following:

• Train all of your employees responsible for employee discipline, including terminations, to ensure they understand the importance of preserving all of the information that they rely on to make disciplinary or termination decisions — even if they think (as this Wal-Mart manager likely did) that some of the information is redundant.
• Train all of your employees responsible for conducting investigations into allegations of workplace misconduct in how to conduct and document investigations that will withstand legal scrutiny. Workplace Investigations Group offers training programs nationwide.
• Implement a process for review of all terminations by Human Resources and/or your employer’s legal counsel.