Henry C. Yuen, the former chief executive officer of

Gemstar-TV Guide International, was under investigation by the Securities and

Exchange Commission (SEC) for committing an accounting fraud that resulted in

billions of dollars of lost market value for investors. The SEC's case was being

developed with the use of e-mails and other electronic documents. During the

continuing investigation, Mr. Yuen installed a software tool called Eraser on his

company PC and proceeded to wipe the entire contents of his hard drive, including

unallocated space, so that no electronic courtroom evidence could be recovered. The

hard drive contained e-mails, corporate documents, and other electronic documents

that had been subpoenaed by the SEC.

Yuen's action destroyed needed electronic evidence for the fraud case. Consequently,

Mr. Yuen, unlike the top officers at Enron, could not be effectively prosecuted for a

complex securities fraud that included recognizing millions of dollars in phantom and

kickback revenues on Gemstar's audited annual report. Instead of charging Yuen with

securities fraud, he was charged in a civil case and with obstruction of justice.

What should have been done to prevent the destruction of electronic evidence

contained on a company's computers?