At the risk of stating the obvious, losing or mishandling evidence is a very bad thing. Particularly if it is an important component to a defective productsc case.
In the past, some parties had argued that even if they lost the evidence, no sanction against them should lie unless they did so deliberately, or with recklessness.
But that is not the law in New York, and hasn't been for quite some time.
To the contrary, New York's courts have held as follows:
For a spoliation sanction to be applicable, there need only be the "reasonable anticipation of litigation" (VOOM HD Holdings LLC v EchoStar Satellite L.L.C., 93 AD3d 33, 43 [1st Dept 2012] [internal quotation marks omitted]; see also Samaroo v Bogopa Serv. Corp., __AD3d__, 964 NYS2d 255 [2d Dept 2013]) ...
"For the purposes of a spoliation sanction, "[a] culpable state of mind . . . includes ordinary negligence" (VOOM HD Holdings LLC, 93 AD3d at 45 [internal quotation marks omitted]; see Squitieri v City of New York, 248 AD2d 201, 203 [1st Dept 1998]).
In layperson's terms, this means that if you have reason to suspect that a lawsuit may be brought over what occurred, you have an affirmative obligation to try and secure the evidence, and make sure it remains intact. Anything less, you risk having the court preclude what remains of that evidence, a court order allowing the trier of fact to infer that the evidence, had it been properly preserved, would have harmed your case, or worse, dismissal of your claims (or defenses, as the case may be).