## Facts

- Musician Ryan Leslie’s laptop computer, external hard drive, and other property were stolen while he was on tour in Germany; the devices reportedly contained music and video materials, including an unreleased album.
- Leslie posted a YouTube video offering a $20,000 reward to anyone who returned the stolen items, and later posted another video increasing the reward to $1 million.
- The $1 million reward was publicized beyond YouTube, including by news outlets and on Leslie’s Facebook and Twitter accounts, and Leslie discussed it in a televised interview.
- Armin Augstein obtained the laptop and hard drive and delivered them to German police in Cologne, which resulted in the items being returned to Leslie in New York.
- Augstein sought the promised reward. Leslie refused to pay, contending that the digital materials he cared about were no longer present on (or accessible from) the hard drive when it was returned.
- Leslie and members of his team attempted to access the hard drive’s contents without success and then sent the drive to the manufacturer, Avastor; Avastor deleted the drive’s information and sent Leslie a replacement.
- Augstein sued Leslie (and related entity NextSelection, Inc.) in the Southern District of New York, asserting that Leslie’s public reward statements created a unilateral contract that Augstein accepted by returning the property, and seeking sanctions based on spoliation of the hard drive’s contents.
- Augstein moved for summary judgment on whether the reward was a valid offer and whether he accepted and performed, and separately moved for spoliation sanctions under Rule 37.

## Issues

1. Whether Leslie’s widely publicized reward statements (including the $1 million figure) were sufficiently definite to constitute an enforceable offer of a unilateral contract, rather than nonbinding advertising.
2. Whether Augstein’s return of the laptop and hard drive through German police constituted acceptance and completion of the requested performance so as to entitle him to the reward.
3. Whether Leslie had a duty to preserve the hard drive’s data once litigation was reasonably anticipated and, if so, whether the deletion of that data warranted spoliation sanctions, including an adverse inference.

## Decision

- The court granted Augstein’s motion for summary judgment only to the extent of declaring that Leslie’s reward statements constituted an offer.
- The court otherwise denied summary judgment, leaving for trial remaining questions tied to contract liability and damages (including disputes about the terms and whether Augstein’s actions satisfied any conditions of the reward).
- The court found that Leslie had a duty to preserve the hard drive’s data once a dispute over the reward made litigation reasonably anticipated.
- The court concluded the hard drive data was destroyed due to negligent conduct in the handling and transmission of the drive to Avastor without adequate preservation steps.
- As a remedy for spoliation, the court imposed an adverse-inference sanction permitting the jury to infer that the deleted data would have been unfavorable to Leslie’s position—i.e., that the relevant digital materials were on the hard drive when it was returned.
- The case proceeded toward trial on the remaining issues.

## Legal Principles

- A reward announcement can be a unilateral contract offer when, viewed objectively, it is clear and definite and is intended to induce performance (return of specified property) in exchange for a stated payment.
- Widespread publication through online video, social media, and press coverage does not prevent formation of an offer; the question is whether a reasonable person would understand the statement as a commitment upon completion of the requested act.
- A unilateral offer is accepted by performing the act requested in the offer; whether performance satisfies the offer’s terms may present fact questions where conditions or scope are disputed.
- A duty to preserve evidence arises when litigation is reasonably anticipated; that duty includes taking reasonable steps to preserve electronically stored information central to disputed issues.
- Spoliation sanctions may be imposed where (1) the party had a preservation duty, (2) the party acted with a culpable state of mind (including negligence), and (3) the lost evidence was relevant such that its loss may prejudice the opponent.
- An adverse-inference instruction is an available sanction to address prejudice from loss of relevant electronic evidence, even where the destruction is negligent rather than intentional.

## Conclusion

In *Augstein v. Leslie*, the court held that Leslie’s public $1 million reward promise was a definite unilateral-contract offer, but it left other contract and damages questions for trial; it also sanctioned Leslie for negligent spoliation after hard-drive data was erased, allowing the jury to infer the missing data would have favored Augstein’s claim.


Augstein v. Leslie, 2012 WL 4928914 (2012)