Is Review Software Not Reasonably Accessible Because of Cost?

W Holding Co. v. Chartis Ins. Co., is a case involving competing proposed discovery protocols. The parties include the FDIC as the receiver of a bank and the former bank directors & officers in a $176 million suit with claims of negligence in making loans. W Holding Co. v. Chartis Ins. Co., 2013 U.S. Dist. LEXIS 52313, 4-9 (D.P.R. Apr. 3, 2013).

The universe of ESI began as approximately 6.8 terabytes of ESI and 921,000 paper documents. W Holding Co., at *6. $2.1 million was spent scanning paper into a searchable digital format. Id.

The FDIC planned to migrate data from one hosted review application to another to give access to party opponents of specific data. The projected cost for the hosting included:

Data migration of $450 per gigabyte

$0.185 per page for scanning paper documents and generating searchable text;

$0.025 per page for Bates and confidentiality stamping;

$325 per gigabyte for imaging native-format ESI into TIFF files; and

$35 to $300 per labor-hour for technicians, quality control, and management staff.

W Holding Co., at *6-7.

…and where there is lots of money being spent, there are disputes.

What is Not Reasonably Accessible?

The FDIC claimed the bank’s ESI in a review database was not reasonably accessible under Rule 26(b)(2)(B), thus requiring cost shifting. W Holding Co., at *13-14.

The party claiming ESI is not reasonably accessible must demonstrate the undue burden. The claim cannot simply be the ESI is expensive to produce because of volume, but that the cost must be “associated with some technological feature that inhibits accessibility.” W Holding Co., at *14, citing Chen-Oster v. Goldman, Sachs & Co., 285 F.R.D. 294, 301 (S.D.N.Y. 2012).

In the words of the Court, the FDIC had not “hinted” at any technical problem that hinder searching the ESI. Moreover, the ESI was already in a database for search. W Holding Co., at *14.

Even though the FDIC argued that high production costs could make ESI not reasonably access under FRCP 26(b)(2)(B), the Court made an important distinction between accessibility and proportionality. As the Court explained:

In short, I reject the contention that Rule 26(b)(2)(B)—and its shifting burden to justify production requests—kicks in any time that discovery implicates both (1) electronically stored information and (2) large volumes of data, even where the volume renders review costly.

Because FDIC -R has not shown that access to the Westernbank data is hindered by any unique technological hurdles, it has failed to trigger Rule 26(b)(2)(B). It is therefore not entitled to categorically label the DMS databases “not reasonably accessible.”

W Holding Co., at *16.

Proportionality

The Court attempted to analyze the proportionality factors under Federal Rule of Civil Procedure Rule 26(b)(2)(C). However, as the Court stated, “But frankly, the parties’ broad claims about their respective discovery proposals are too speculative to merit a ruling at this time.” W Holding Co., at *18.

The Court noted that the FDIC’s affidavits explained the “bulk costs” of the work, but did not “shed any light on the effort in this case” or provide what it would take to build responsive searches. W Holding Co., at *18-19. The Court stated:

In sum, this is less a situation where the scales are evenly balanced, and more one where the court has been given nothing to place on either side. Until the parties take affirmative steps to conduct discovery—perhaps after test runs, for instance—there is no ground for the court to dramatically alter the defaults under the Federal Rules of Civil Procedure.

W Holding Co., at *19-20.

After a lengthy opinion, the Court’s order can be summarized as follows:

FDIC will neither be categorically required to organize and label its productions, nor permitted to produce documents without adequate organization. 

No cost-shifting is justified at this time, though trial runs showing disproportionate costs, or abusive discovery tactics, could warrant reconsideration. 

The requesting party was to propose search terms first—however, since FDIC oversaw the loading of ESI into a database, it was expected to provide active assistance, and should anticipate consulting its technically-skilled staff or contractors as necessary.

Parties are to meet and confer over privilege issues, opposed to going to the Court initially.

W Holding Co., at *21-23.

Bow Tie Thoughts

Judges want to know the relevant details and reasons for any request for relief. Moreover, the Court is coming into the dispute cold. The Judge does not know the benefits of one review application over another, what is required to build search terms or likely the different search technologies that can be used.

There is a significant difference between accessibility under 26(b)(2)(B) vs proportionality under 26(b)(2)(C).  One way to look at the differences is accessibility is the cost of how you get the data; proportionality involves the benefit of the discovery vs cost. The commonality between the two is both require expert testimony to explain the technical issues to the Court, whether it is retrieving data from legacy systems or using a specific search software to review the data.

We are in a new world where attorneys must explain with expert affidavits why certain technology should be used, what costs are being incurred, why a search is (or is not) reasonable and the age old question of “why” a party is asking the Court for relief. A Judge does not want abstract hypotheticals on cost or searches; a Judge wants to know how the ESI in a lawsuit is being searched, what kind of data is being search and how the technology will make the searches more effective. This requires educating the Judge, which means detailed expert affidavits.

Drop-by-Drop Water Torture Productions

There are judges who have a way with words when they want to make a point. One example of such judicial prose was by Magistrate Judge Gregory G. Hollows in Botell v. United States:

At this juncture, the United States has purportedly been looking for documents for months, yet the undersigned, to the date of the hearing, does not have confidence that an organized, thorough search has been performed. Rather, defendant’s document production performance in these proceedings has been akin to a drop-by-drop water torture. At some point, plaintiff must be protected from the United States’ further belated production of pertinent documents. The court now enters a preclusion order prohibiting the United States from presenting evidence in its case that had been requested by plaintiffs in the Requests for Production, but which has not been produced by the date of compliance with this order.

Botell v. United States, 2012 U.S. Dist. LEXIS 134265, 15-16 (E.D. Cal. Sept. 18, 2012).

Botell v. United States is a wrongful death and personal injury case involving a minor injured and another killed at a National Park. The Government produced over 7,000 pages of documents, but there was a “a glaring lack of production of emails from defendant’s agents and employees.” Botell, at *11-13. Moreover, the total number of custodians produced by the Defendant totaled one.

The Plaintiffs argued five other relevant custodians’ emails needed to be produced, because the custodians were referenced in the already produced ESI. Botell, at *11.

The Defendants produced one declaration by the Chief Ranger at the park, which explained his efforts to find responsive email.

These efforts included “searching” the office and network drives, and the Ranger’s coordination with officials and IT personnel at another National Park to search another custodian’s computer. The declaration was silent on any search for emails by the other custodians. Botell, at *11-12.

Another declaration curtly explained the back-up policy for Lotus Notes emails as follows: “[B]ack-up emails are retained for 30 days only, unless they are subject to a litigation hold notice or pertain to the BP Gulf Oil spill.” Botell, at *12.

The Court ordered the Defendants to provide a declaration explaining the searches conducted to locate physical and electronic copies of responsive emails by the five custodians. The Court specifically required the following:

The declaration shall state the steps taken to locate these emails, whether any such emails exist, and if not, a definitive statement that they no longer exist. If further responsive documents are located, they shall be produced at the time declarations are filed.

Botell, at *12-13.

Bow Tie Thoughts

Nothing goes for the jugular like a preclusion order for failing to produce discovery. Botell is a powerful example of the dangers of what appeared to be “do it yourself” collection. While it was not outright stated the Defendant did not have an eDiscovery collection expert, it sure sounds that way from the context of the declarations.

One would hope when a large organization has a triggering event for a lawsuit, an effective litigation hold is enacted. Many of today’s records information management systems have the ability to electronically sequester a specific custodian’s email and ESI with a keystroke. Additionally, much of this technology has Early Case Assessment and data reduction features that can identify the relevant information for attorneys to review.

An organization should either have professionals trained in the search and preservation of ESI or retain outside professionals to competently preserve ESI. The steps taken to search and identify responsive ESI must be documented and should, at a minimum, explain the search methodology; technology used; data sources searched; search results; possible exclusions or exotic files; and anything else relevant to explain to a judge how ESI was searched.

A requesting party should not have to blink “torture” in Morse Code for a judge to stop a party neglecting their discovery obligations. An attorney’s duty of competency should compel their preservation obligations are met with those trained to effectively find and produce responsive discovery.

eDiscovery Review Strategies

Tips on reviewing electronic discovery, including issue tagging for causes of action or defenses and eDiscovery project management.

Forensically Examining A Lawyer’s Computer

In a dispute over a will and deed transfer, a New York State Court ordered the examination of a lawyer’s computer.

The idea of an attorney’s computer being searched by third parties should scare lawyers to death.

The attorney objected on the grounds the examination would violate the attorney-client privilege and work-product doctrine for all of the attorney’s other clients.

The Court was also concerned about privilege issues and ordered the following examination:

The computer forensic examiner was directed to review the computer only for documents that refer to Rose Tilimbo and it must not examine files which would not likely lead to the discovery of evidence related to Rose Tilimbo.

In the event the forensic examiner inadvertently examined any information that was not related to Rose it is directed to immediately cease the examination of that file.

In the event that forensic examiner located documents that refer directly to Rose Tilimbo or appear to be related to the purported will or the alleged deed transfer, those documents shall be mailed to the parties’ attorneys.

The attorneys would have 14 days from the receipt of documents to object to disclosure to the movants by notifying counsel for the movants that he is objecting and sending the documents to the court for an in camera inspection together with the reasons for the objection.

In the event that no objections are made to the production of the documents or the court rules that the documents are to be disclosed the computer forensic examiner may thereafter submit the documents to movants’ counsel.

Matter of Tilimbo v. Posimato, 2012 N.Y. Misc. LEXIS 4027, at *13-14 (N.Y. Sur. Ct. Aug. 22, 2012) (Emphases added).

Bow Tie Thoughts

It is very good to see a state court judge address the privilege issues of how to examine a lawyer’s computer.

If you ask three different computer forensic examiners how they would comply with the Court Order, you would probably have three different answers. The right approach will depend on how data is stored and multiple other factors best left to the experts.

One option is to make a “mirror image” of the computer and then search for responsive data. This is likely the least desirable for the attorney, because the entire contents of his computer have now been copied and are in the hands of a third-party. Short of a protective order and the computer experts acting as court-appointed neutral examiners who return or destroy the mirror image at the end of the examination, this is least desirable from an attorney’s perspective.

There is software available where the attorney could effectively self-collect his client files. While this might provide the most piece of mind to the attorney, it likely causes the most stress for the requesting party. It also raises issues of how searches were conducted and can easily cast doubt on the adequacy of the collection.

Another option is for a targeted collection of the attorney’s hard drive. This might take more time then doing a mirror image of the hard drive, but provides more piece of mind to the attorney. The collection is based on search terms devised by the computer forensic expert and attorneys to specifically identify the relevant information. This conceptually is a good middle ground approach to both preserve the parties’ interests and the confidentiality of the attorney’s clients.

Instead of the computer forensic examiner “mailing” documents to the attorneys, a hosted repository is an option the parties and court should consider. The producing party could first review the responsive information for any privileged ESI, creating all the necessary information for a privilege log right in the database. The requesting party could then perform its own review and note any challenges to any asserted privileges. The Court itself could then review the information “in camera” and rule on any privilege issues without protracted motion practice.

Too Many Cooks in eDiscovery

Also Posted on frank! The Nextpoint Blog

There are phrases a lawyer never wants to hear a judge say. One is your law firm “acted negligently in failing to comply with its discovery obligations.” Another is your client “acted willfully in failing to comply with its discovery obligations and assist its outside counsel to properly litigate this case in accordance with the Federal Rules of Civil Procedure and the Federal Rules of Evidence.”

Both phrases were stated in Coquina Invs. v. Rothstein. The facts have a Qualcomm-esq theme and highlight the need for project management like a fireball in the night. At a fundamental level, attorneys should not be afraid to ask their client questions about how they maintain their records. Moreover, trial counsel should never assume documents are only maintained as paper.

A lot of things went wrong in this case. The Court described that discovery was conducted in an “Inspector Clouseau-like fashion,” except there was nothing funny about it. Coquina Invs. v. Rothstein, 2012 U.S. Dist. LEXIS 108712, 4-5 (S.D. Fla. Aug. 3, 2012).

The Court stated the law firm (Law Firm 1) had over 200 attorneys working on the case, which included different attorneys handling the banking issues, document production, pretrial and trial practice. Id. 

The Court described the number of lawyers on the case as “too many cooks spoiling the broth.” Id.

The client also retained a second law firm (Law Firm 2). Law Firm 2 hired a consultant to perform work related to the case handled by Law Firm 1, which was not related to Law Firm 1. Id.

Not Now Cato!

The Plaintiff argued in their Fourth Motion for Sanctions that the Defendant altered a Due Diligence form to mislead the jury. Coquina Invs., at *5. While that is an excellent lineal attack, the facts were a lot more complicated.

A month after the Plaintiff’s filed their motion, the Defendant produce a document that the attorneys initially denied existed. Furthermore, Law Firm 1 filed a motion to withdraw certain statements and for the substitution of counsel (enter Law Firm 3). Coquina Invs., at *5.

Swine Form of Production

The major issues of the case focus on the form of production.

The Defendants produced ESI from a Lotus Notes database as a black and white static image. However, the native file had a red banner across the top of the file with the words “High Risk.” As a static image, “High Risk” appeared in black with a grey banner. Coquina Invs., at *12-13. At the evidentiary hearing, testing showed that printing the black and white TIFF’s made the header entirely black. Coquina Invs., at *14.  In short, a color TIFF was needed for the banner to remain visible.

The issue did not end with color TIFF’s. Even though the review database had the native files, one of the attorneys asked the client for a hard copy of the document at issue. The client directed her assistant to print the document and “identify any attachments in pen.” Coquina Invs., at *15.

The printed copies had several issues, such as “High Risk” being faint, but the formatting was altered so that the writing that ran horizontally across the top of the top of the document was compressed into a column running vertically down the page. Coquina Invs., at *15-16.

The “printed” file also lacked the embedded information that included the file’s archive and editing history. Coquina Invs., at *15-16. The Court described the difference between the printed file and the native file as “glaring.”  Coquina Invs. at *16.

The Court explained Law Firm 1 produced discovery directly to Plaintiff without the service provider’s assistance. Coquina Invs., at *17. With the document at issue, Law Firm 1 scanned the printed document and produced a PDF to the Plaintiff, instead of producing in native file format or as a color TIFF. Coquina Invs., at *18.

At a hearing opposing the Plaintiff’s motion to compel production of ESI as native files, in-house attorneys represented it was their practice to produce documents as they are kept in the normal course of business. Id. The in-house attorney assured the Magistrate Judge that a third-party vendor was conducting the production and that discovery would be produced as TIFF, searchable with 34 columns of metadata. Id.

Law Firm 1 thought the documents were maintained as hard copy documents in the ordinary course of business, thus why the firm produced the documents as PDF’s. Coquina Invs., at *18-19. One attorney testified that a senior associate confirmed to them that the documents were kept as hardcopies. Id.

As the court coldly stated: Obviously that information was incorrect. Coquina Invs.,  at *19.

Furthermore, the Court noted that Law Firm 1 did not have anyone contact their client on how the subject documents were ordinarily maintained (in Lotus Notes) or run any searches in their review software. Id.

The Curse of the Native Files

The Court held Law Firm 1 “acted negligently in failing to produce the CDD form in a manner that preserved the document’s qualities. It is clear that, to preserve all its original qualities, the CDD form should have been produced in native format or color tiff.”  Coquina Invs., at *19.

The Court’s stated the following on the production mistakes:

Evans testified that [Law Firm 1] produced this document in a separate pdf production without [Service Provider’s] involvement because she believed TD Bank kept the document in hardcopy in its ordinary course of business. This explanation is hard to believe. Upon review of the printout, [Law Firm 1] or in-house counsel should have immediately realized, at a minimum, that some information was lost due to the formatting errors, which are clearly visible on the face of the document. From looking at the formatting errors on the face of the document it is clear that it existed originally in some sort of electronic format. That should have prompted questions about how [Defendant] kept the documents. Further, it is reasonable to infer that at least one [Law Firm 1] attorney saw the original, html color document during discovery on the [Service Provider] document review platform. That placed the attorneys on notice that the document existed on Lotus Notes in native format and was originally in color. Finally, it is clear from a review of the initial printout—which contained a faint and barely legible banner—that further printing or copying of the document would result in degradation of the document’s clarity or quality.

Coquina Invs., at *40-41.

The Court stated the following on the Defendant:

[Defendant] acted willfully in failing to rectify [Law Firm’s] error or allowing it to endure. [Defendant] hides behind [Law Firm’s] mistakes and points to Pinkus’s deposition testimony to wash its hands clean of any involvement in this production of documents. [Defendant] would have this Court believe that, except for Pinkus, none of its approximately fifteen in-house lawyers or its representatives who sat through trial had any idea what the critical documents in this case were supposed to look like, and therefore cannot be held responsible for not noticing that the CDD form contained blacked out headers and lacked archive and editing information during pretrial or trial proceedings. That explanation defies credulity. Having reviewed the evidence and made the appropriate credibility determinations, I do not accept that this was the case.

Coquina Invs., at *41-42.

Revenge of the Native Files

The Court held Law Firm 1 and the Defendant were to pay the Plaintiff’s attorney’s fees and costs associated with bringing and litigating the various motions. Coquina Invs., at *49.

Son of Sanctions

The Court did not issue any sanctions against the individual attorneys, because there was no evidence any of them acted in bad faith or willfully. Coquina Invs., at *50-51.

However, the following statement by the Court is damning:

The individual [Law Firm 1] attorneys’ handling of this case left much to be desired. The document review and production appears to have been conducted in an almost ad hoc manner. The attorneys failed to adequately conduct document searches in response to Coquina’s counsel’s requests and this Court’s inquiries. The attorneys produced key documents on the eve of trial, and in the midst of trial, because of failures in their document search and production procedures. Although I recognize that the attorneys were dealing with a high volume of documents, the amount of production errors that occurred throughout these proceedings were simply incredible, especially coming from lawyers in a well regarded firm like [Law Firm 1], which in many ways earns its reputation from being able to litigate large, complex actions.

Coquina Invs., at *50.

Bow Tie Thoughts

Winston Churchill stated “Why, you may take the most gallant sailor, the most intrepid airman or the most audacious soldier, put them at a table together – what do you get? The sum of their fears.”

The same description applies to Coquina Invs. v. Rothstein. This case should terrify attorneys, eDiscovery service providers and corporate clients highlighting everything that can go wrong in the search and production of eDiscovery in a complex case.

There has been a fear since the first Qualcomm opinion of clients controlling what information trial counsel can review. This can negatively impact a lawyer’s ethical duty to be truthful to a Court if a client does not inform their attorneys about relevant information. Moreover, if there is information the client knows to be wrong, that needs to be communicated immediately to their attorneys.

eDiscovery requires project management in order for attorneys to completely practice law. Attorneys, their clients and any service providers must have clearly defined responsibilities, open communications, and a workflow that everyone involved follows consistently. Without effective project management, the risk of an eDiscovery Chernobyl grows exponentially.

The “form of production” still haunts many attorneys, with some outright expressing fear of producing ESI in native file format. While there are valid reasons to produce ESI as static images for redactions, I have been an advocate of native file productions for years.

Attorneys must understand the data they are reviewing, issues with production formats and know the risks associated with producing as static images. Many of the issues in this case could have been avoided with producing in native files or at least color static images. Moreover, it is highly unlikely a company would only maintain ESI as paper, given the cost of printing, storage or simply how people work in the 21^st Century. However, those are excellent questions to ask a client at the beginning of representation.

You Do Have to Look for Discovery in Your Possession

A Producing Party (the Defendant) argued against searching for responsive electronically stored information, claiming “that the mere fact an employee might have discoverable information or relevant knowledge does not necessarily mean she possesses relevant documents.” McNearney v. Wash. Dep’t of Corr., 2012 U.S. Dist. LEXIS 108386, 14-16 (W.D. Wash. Aug. 1, 2012).

Negative inductive reasoning aside, Federal Rule of Civil Procedure Rule 34 requires a party “to produce requested documents if they are within his ‘possession, custody, or control.’” McNearney, at *14, citing Kissinger v. Reporters Committee for Freedom of the Press, 445 U.S. 136, 165 n.6 (1980) (Stevens, J., concurring in part and dissenting in part).

The Producing Party did not challenge that it failed to search for responsive electronically stored information from “numerous employees identified as likely having discoverable [information],” but took the position that just because it was possible the custodians had relevant information, did not mean they actually had the relevant information.  McNearney, at *14.

The Court agreed with the logic, but that did not give the Producing Party a free pass on its duty to make a reasonable inquiry, especially considering the fact the Producing Party identified the employee as likely having relevant information. Id.

Further causing problems for the production, was a difference in email messages produced by the Defendant and two other Defense custodians, suggesting that there had not been a reasonable search for email by one of the Defense custodians. McNearney, at *14-15.

The Producing Party also conceded that it did not produce email attachments and that its search scope was narrower than the Plaintiff’s discovery requests. McNearney, at *15.

The Court held the following on the Defendant’s search:

Defendant’s production of some documents in response to RFP No. 5 does not satisfy its duty to make a reasonable search for and produce all responsive documents in its possession, custody, or control. Despite its original objection that RFP No. 5 was unduly burdensome because it was “a trap for Defendants,” DOC has not demonstrated that conducting a thorough search for responsive ESI would pose an undue burden or cost, as required in responding to a motion to compel. Fed. R. Civ. P. 26(b)(2)(B).

McNearney, at *15-16 (Emphasis added).

Bow Tie Thoughts

A party must demonstrate undue burden to limit discovery. This does not include an argument “that just because there might be something relevant, does not mean there is something relevant.”  While that is true in a logical discussion during a philosophy class, the Federal Rules of Civil Procedure are not an exercise in metaphysical nihilism to circumvent a party’s duty to conduct a reasonable search for responsive ESI to a discovery request.

The Federal Rules of Civil Procedure require ESI to be produced as it is ordinarily maintained or in a reasonably useable form. By the plain language of “ordinarily maintained,” a producing party cannot break the parent-child relationship between email messages and their attachments (or Tweets and Hyperlinks or text messages with photos).  Additionally, a production that breaks the parent-child relationship is not in a “reasonably useable form,” since searching for an attachment to its corresponding message is like re-unitizing a document that has had its staples removed and the pages shuffled with 1,000 other pages.

The technology to collect, search and produce electronically stored information are well established now after a decade of being available. These products are common services offered by eDiscovery service providers and many law firms have brought these technologies in house. While electronic discovery has many challenges, there are solutions available to these challenges that are affordable.

Discovery from 3rd Party Vendors

A company outsourcing payroll, human resources and other business services to third parties is standard operating procedure today.  However, what happens when there are discovery requests for a party’s business information hosted by a third-party?

Such discovery requests caused a court to play butcher to carve out the discovery obligations of the parties and third-party vendors in Bush v. Ruth’s Chris Steak House, Inc.

Bush v. Ruth’s Chris Steak House, Inc., is an employment dispute. The first dispute with third-party discovery involved the Defendant’s applicant tracking database. The Defendant did not produce the information, because their third-party vendor maintained it. Bush v. Ruth’s Chris Steak House, Inc., 2012 U.S. Dist. LEXIS 86351, at *10 (D.D.C. June 18, 2012).

The Plaintiffs argued that the Defendants needed to produce and bear the costs of production, because the information was under the Defendant’s custody and control. Id.

The Defendant countered that they did not have “possession” of the applications and that they did “not have control because they have neither possession of the documents nor an employment relationship with the third party vendors, such that Defendants would have a legal right to obtain the documents at issue ‘on demand.’” Id.

As such, the Defendant took the position the Plaintiffs needed to either 1) pay for the production or 2) do a Rule 45 request to the third-party. Bush, at *10-11.

The key issue was whether the Defendant had “control” of the requested discovery.

Case law states the following on “control”:

Control does not require that the party have legal ownership or actual physical possession of the documents at issue, but rather “the right, authority or practical ability to obtain the documents from a non-party to the action.”

Bush, at *11.

The Court did not spend a much time carving up the issue of control, finding it would require a large investment of judicial resources to determine if the Defendant actually controlled its vendor. As such, the cost of $500 for producing the information was to be divided between the parties. Bush, at *12-13.

The other discovery at issue were the employee tests that allegedly were the barriers for advancement for the female employees. Bush, at *13.

A third-party maintained the tests and scores. The third-party stated retrieving the test data would take 40 or more hours. The cost was $150 an hour for the work (so at least $6,000). Id.

The Defendant also maintained the tests in the personnel files, but refused to compile the records, arguing that a prior Court Order stated they were not required to “compile results from review of employee records.”  Id.

The Court was blunt: “The test data sought is in Defendants’ possession, and therefore must be disclosed under Rule 34.”  Id.

The Court explained the prior Order applied to human resource data, not test records. Moreover, the issue of test data was discussed in another area of the Court Order and was not excluded from production. Bush, at *13-14.

Bow Tie Thoughts

Companies use third-party vendors extensively in modern business. Courts will not likely tolerate producing parties using those relationships as a shield from production. Courts will either focus on whether the producing party had “control” of their data; order the producing party to bear the production costs; split the costs between the parties; or require a third-party request in some situations.

My instincts tell me it will likely be the producing party who has to take the laboring oar in ordering the production of data hosted by a third-party vendor. It is very easy for information hosted by a third-party to fall under the Stored Communication Act or other privacy laws regulating hosted data. Moreover, a Rule 34 request can force the producing party to consent to disclosure under the Store Communication Act in order to respond to the request, opposed to requiring the third-party to seek consent from the actual party. As such, focusing on the party and their control over their data is likely the direct approach in requesting such information, opposed to Rule 45 requests on the third parties.

No Request, No Motion to Compel

The Plaintiff in ADT Sec. Servs. v. Pinancle Sec., LLC, objected to a Magistrate Judge’s denial to a motion to compel to redo the Defendant’s search for responsive ESI.

The Plaintiff’s argued the Defendants failed to search individual employee computers and back-up tapes.

Additionally, the Plaintiff’s highlighted a considerable disparity between the volume of ESI produced by the Plaintiff verse the Defendant. ADT Sec. Servs. v. Pinancle Sec., LLC, 2012 U.S. Dist. LEXIS 98948 (N.D. Ill. July 11, 2012).

As such (in the Plaintiff’s argument), the disparity demonstrated the Defendant did not produce enough ESI, thus requiring additional searches.

Discovery Order to Conduct Additional Searches

The Magistrate Judge did not find any “legitimate basis for requiring Pinnacle to re-do its extensive ESI search” based on only a general assertion that documents must be missing. ADT Sec. Servs. at *6.

A motion to compel discovery should identify the responses that are inadequate and what information is necessary to make them adequate.  ADT Sec. Servs. at *5-6. The Plaintiff only made a general assertion that the searches were inadequate and thus the motion failed in a broad court order. Id.

However, the Magistrate Judge did issue a limited order to re-search seven employee computers, because there was evidence the computers might have contained ESI missing from the original production.  ADT Sec. Servs. at *6.

The District Court found the Magistrate Judge’s order was reasonable and not clearly erroneous or contrary to law, because the seven computers ordered to be searched were used by individuals whose correspondence had been specifically requested by the Plaintiff with specific search terms. ADT Sec. Servs. at *6.

Moreover, the Plaintiff’s motion to compel the search of 10 additional custodians with new search terms violated the principle that “…[t]o further the application of the proportionality standard in discovery, requests for production of ESI and related responses should be reasonably targeted, clear, and as specific as practicable.” ADT Sec. Servs. at *7, citing Seventh Circuit Electronic Discovery Committee, Principles Relating to the Discovery of Electronically Stored Information, Principle 1.03 (2010).

Based on the above, the Court found the Magistrate Judge’s order was not clearly erroneous or contrary to law. ADT Sec. Servs. at *7-8.

Bow Tie Thoughts

There are procedural horror stories of attorneys bringing motions to compel discovery without an underlining discovery request. Such motions should be denied, because you cannot have a motion to compel without first requesting specific discovery.

Discovery is not supposed to be a monkey throwing darts wildly, hoping one hits the target. However, there can be challenges in determining the relevant custodians, what to specifically request, and the sources of electronically stored information. These challenges can make the brightest lawyer feel like the dart throwing monkey.

There are situations when it comes to eDiscovery where motion practice can be justified. If a production is reviewed in software that shows relationships between email messages, additional custodians may be identified who were not included in the original production. This can easily result in supplemental discovery or possibly motion practice. Hopefully, there is a meet and confer and ESI that is responsive is produced without spending money on motion practice.

Striking Undisclosed Audio Recordings

In a summary judgment battle, the Plaintiff referenced audio recordings in opposition to the Defendants’ summary judgment motion.

The Defendant brought a motion to strike the audio recordings, because the audio was neither disclosed nor produced in discovery. Rector v. Town of Fishers, 2012 U.S. Dist. LEXIS 81771 (S.D. Ind. June 13, 2012).

The Court tossed out the audio recordings like they were 8 track cassettes.

Turning Up the Discovery Gain

The discovery dispute involved audio recordings the Plaintiff made of conversations with one of the Defendant’s employees. These recordings were never produced in discovery, despite a request for any statements, including recorded, that referenced the events in the lawsuit. Rector, at *1-2.

The Discovery Amplifier

The Court explained the Federal Rules of Civil Procedure were enacted to make trial practice fair and not a “game of blind man’s bluff.”  Rector, at *2.

Federal Rule of Civil Procedure Rule 26(a)(1)(A)(ii) imposes affirmative disclosure obligations on parties to disclose “all documents, electronically stored information, and tangible things that the disclosing party has in its possession, custody, or control and may use to support its claims or defenses, unless the use would be solely for impeachment.” Rector, at *2, citing Fed. R. Civ. Pro. 26(a)(1)(A)(ii).

Grazing Effect on the Court

The Court found the audio recordings should have been produced under Rule 26(a), noting that the Plaintiff included the recordings in their opposition to the Defendant’s summary judgment motion.  Rector, at *3. Moreover, the Plaintiff was also obligated to produce the recordings pursuant to the Defendant’s Rule 34 request. Id.

One does not need noise canceling headphones to hear the Court’s message that the audio recordings should have been produced:

Indeed, so clear is the discoverability of the audiotape that the Court notes that Plaintiff’s counsel has been unable to explain why the audiotape was not produced during discovery.

Rector, at *3.

Discovery Zenith 

The Court explained that pursuant to Rule 37(c)(1), when a party withholds information that should have been included in its initial disclosures, “[t]he exclusion of non-disclosed evidence is automatic and mandatory under Rule 37(c)(1) unless non-disclosure was justified or harmless.” Rector, at *3, citing Musser v. Gentiva Health Servs., 356 F.3d 751, 758 (7th Cir. 2004).

The Court’s stated the following in its order to excluded the audio recordings:

Given the Plaintiff’s inability to explain its non-production, the Court cannot find that the non-disclosure was justified. As for harmlessness, the Plaintiff does not argue it. Even if the Plaintiff had, the Court would reject here. The Defendant prepared its motion for summary judgment based upon what it believed to be the evidentiary record. Had it known about the audiotape, it might have structured its argument differently—or perhaps even avoided filing a motion altogether. Accordingly, consistent with Rule 37(c)(1), the Court will exclude the undisclosed evidence for the purposes of summary judgment.

Rector, at *3-4.

Bow Tie Thoughts

Highly skilled and competent lawyers have to think very broadly when discussing discovery with their clients. Virtually every smartphone has a recording feature. It certainly does not hurt to ask a client if the client recorded anything about the lawsuit, either on their phone or a digital recording device. While no one is expecting Garage Band to be in discovery, none of the drummers from Spinal Tap were expecting to spontaneously combust.

After determining whether any audio discovery exists, the next issue is reviewing it for whether it is relevant to the case or responsive to a discovery request. Many of the litigation support review platforms today can support audio discovery. Additionally, many litigation support service providers can also transcribe the audio, so the text is searchable in the review database.

Audio discovery should be included in client interviews to determine if any exists. If it does, verify with a service provider they can transcribe the audio and whether their hosted review platform supports audio files.

Cowboys & Lawyers: Spaghetti Western eDiscovery

Judge Facciola stands as one of the single most prolific Federal Magistrate Judges in the United States.

Once again, the bow tie wearing jurist eloquently laid down the law in Tadayon v. Greyhound Lines, Inc. The discovery order concluded with the following passage:

III. High Noon

As explained at the discovery status hearing held on April 30, 2012, there is a new sheriff in town—not Gary Cooper, but me. The filing of forty-page discovery motions accompanied by thousands of pages of exhibits will cease and will now be replaced by a new regimen in which the parties, without surrendering any of their rights, must make genuine efforts to engage in the cooperative discovery regimen contemplated by the Sedona Conference Cooperation Proclamation. First, the parties will meet and confer in person in a genuine, good faith effort to plan the rest of discovery. They shall discuss and agree, if they can, on issues such as the format of any additional productions, the timing and staging of all depositions, the submission to each other of discovery reports, and the scope and timing of any Federal Rule of Civil Procedure 30(b)(6) depositions. The parties will then jointly submit their discovery plan for my approval. I commit myself to work with them in resolving any disagreements, whether they arise initially or during discovery. To that end, I will schedule a telephonic status conference every two weeks in which I will ask the parties about their progress (or lack thereof) and try to resolve any disagreements they have.

Tadayon v. Greyhound Lines, Inc., 2012 U.S. Dist. LEXIS 78288, 15-17 (D.D.C. June 6, 2012).

What procedural history did the parties ride through for the Court to order a telephonic status conference every two weeks?

The Wild Bunch

There is an old cowboy quote that applies to lawyers and eDiscovery: Generally, you ain’t learnin’ nothing when your mouth’s a-jawin’.

The case involved patent infringement claims of wireless technology wrongfully being used on the Defendants’ busses. Both sides had dueling discovery motions.

The pro se Plaintiffs brought a motion to compel discovery responses after the Defendants at first produced paper and then ESI.  The Court quickly held the motion to compel moot. Tadayon, at *2.

Unforgiven: Clawing Back Inadvertent Productions

The Defendants inadvertently produced privileged discovery that they “clawed back” pursuant to agreement. The Plaintiffs argued that any privilege was waived because of the Defendants’ “hurried negligence.” Tadayon, at *4.

The Plaintiffs’ argument failed, because the clawback agreement was not in any way conditioned.  Id.  As the court stated, “Since the right to clawback was not so conditioned, the agreement stands as written and defendant may recall the privileged documents, irrespective of whether or not its initial production was negligent.”

My Darling Clementine, Plaintiffs’ Sanctions Are Denied

When you’re throwin’ your weight around, be ready to have it thrown around by somebody else.

Unknown Cowboy Quote

The Plaintiffs sought sanctions and attorneys’ fees against the Defendant, which the Court denied. The Plaintiffs claimed that the Defendants did not timely respond to discovery requests. Moreover, the Plaintiffs alleged that the Defendants purposely delayed their production until they filed a motion to stay. Tadayon, at *4-5.

The Plaintiffs based their sanctions motion on the timing of communications with the Defendant, production history and the District Court’s original minute orders regarding the Plaintiffs’ discovery requests. Tadayon, at *4-5.

Judge Facciola’s analysis focused on the minute orders to determine if Rule 37 sanctions (attorneys’ fees) were warranted. The Court held sanctions were not warranted, because the minute orders applied to the Defendants’ obligations mandated by Rule 26 of the Federal Rules of Civil Procedure, not the obligations imposed by a prior court order, as required by Rule 37. Tadayon, at *7-8.

Even if sanctions had been warranted, an award of attorneys’ fees was not available to the Plaintiffs, because they were pro se litigants.  Pursuant to the Rule 37 and case law, pro se plaintiffs’ time does not constitute “expenses incurred” for attorneys’ fees. Tadayon, at *9-11 (Please see the opinion for the detailed analysis of this issue).

Blazing Saddles

The Court held that the Plaintiffs’ motion to compel was not “substantially justified” under Rule 37, because of the timing of the Defendants’ production and the filing of the motion. Tadayon, at *12.

Judge Facciola included a timeline of the Defendants production and the filing of the motion to compel.  Tadayon, at *14. The Court outlined that the Defendants produced 45,417 pages of responsive discovery 10 days after the District Court’s minute order.  Tadayon, at *15. The Defendants continued to supplement their production three times. On the date of the last production, the Plaintiffs filed their motion to compel.  Id. As the Court explained:

[Pl]aintiffs filed their motion compel, even though by the time the document was filed, most of the discovery disputes had been rendered moot by the production of the electronic version of the documents as well as by plaintiffs’ development of their own database. Furthermore, at no point in time after the filing of plaintiffs’ motion to compel did they consider withdrawing it or modifying it even though they knew that most of the issues had been rendered moot. 

Tadayon, at *15.

The Courted ordered the Plaintiffs to show cause why they should not be sanctioned with attorneys’ fees for the time the Defendants spent opposing the motion to compel. Tadayon, at *15.

Bow Tie Thoughts: Dances with ESI

eDiscovery should not be the gunfight at the O.K. Corral. Parties can reduce motion practice and move their cases forward by cooperating effectively during their Rule 26(f) meetings. I stress multiple meetings, because it is unlikely one conference will settle issues such as collection, search terms and production dates.

Cooperating at a meet and confer does not mean surrender. There are technical issues that must be addressed when discussing electronically stored information. According to Michael Arkfeld, some of these issues include:

Understanding Each Party’s IT System

Preservation of ESI

Agreed upon Computer Terminology (how do you define metadata, forms of production, etc)

ESI Types and Storage Media, Devices & Locations

Production Protocols 

Protecting Privileged ESI

Arkfeld’s Best Practices Guide for Electronic Discovery and Evidence (2010-2011), Appendix B, “Meet and Confer” Planning Guide.

There of course are many more issues that can go into great detail at a Rule 26(f) conference. However, these issues are better addressed with attorneys cooperating and not playing Billy the Kid.