Scanning Paper Makes the Production ESI And Not a Document

Anderson Living Trust v. WPX Energy Prod., LLC, 2014 U.S. Dist. LEXIS 31025, 3-4 (D.N.M. Mar. 6, 2014), is a detailed review of production requirements under Federal Rule of Civil Procedure Rule 34(b)(2)(E). The crux of the case centered on whether scanning paper documents to PDF’s made the discovery “electronically stored information.” Moreover, if the paper discovery was now ESI under the Rules, did the producing party have to organize the production under the 34(b)(2)(E)(i)?

The Court found that the parties agreement to produce paper as PDF’s made the discovery ESI. As such, the organization requirement under 34(b)(2)(E)(i) did NOT apply to the former paper production. Rule 34(b)(2)(E)(ii) controlled instead, which requires ESI productions be in the form it is ordinarily maintained or in a reasonable useable form.

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This case highlights the train wreck that can happen from fighting over the form of production. Moreover, the fact the Court found the paper was transmuted to ESI by scanning might be technically correct, but is problematic. Moreover, the case even included a discussion of whether reviewing ESI in a review platform for privileged eliminated the ability to produce ESI as in “the usual course of business,” because it had been in a review platform.

Scanned paper does not OCR 100%. It runs the risk of not being fully searchable. This will depend on the age of the paper, quality of the text on the pages, and the effectiveness of the OCR technology. Luckily, much of the OCR technology today is very good with high accuracy rates. However, OCR in litigation does yet scan handwriting. As such, one would expect scans of non-text paper to require some form of production labeling.

It costs an eDiscovery service provider the same amount to scan a piece of paper for being a PDF or TIFF as it does for printing. However, the printing costs can add more to the total cost than simply OCR-ing a scanned file (I have seen as much as 10 cents a page cost increase).

If the requesting party wants to be difficult, they can request both paper be produced as paper to drive up the production cost for the producing party AND demand the production be organized under 34(b)(2)(E)(i). This would fly in the face of Federal Rule of Civil Procedure Rule 1 to conduct cases in a “just, speedy, and inexpensive determination” of every action when scanned paper can be produced as an image with searchable tect. Furthermore, the requesting party would now have boxes of paper to review, driving up their own billable hours.

Review technology allows anyone conducting document review to “tag” files for production that correspond to discovery requests. Unfortunately, many attorneys do not do this, either based on time constraints, the lack of interest in organizing a production for the opposing party, or they do not know how to.

Personally, I prefer conducting document review to organize what files are responsive to specific requests. Moreover, the time it takes to tag “produce” could be done just as easily as clicking “RFP1” or “RFP4” as tagging options. This makes it easier to perform quality assurance testing and the basic need to look up what files are being produced to a specific request.

 

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Understanding the Scope of the Duty to Preserve

The important litigation hold cases are not the ones that issue monstrous sanction awards; The important cases are the ones that demonstrate the analytical framework to understand how the law works. These are the opinions that help us represent our clients in knowing what to do when litigation is reasonably anticipated.

Magistrate Judge Paul Grewal’s opinion in AMC Tech., LLC v. Cisco Sys., is such a case that breaks down the duty to preserve, triggering events and the timeline of facts. I think it is extremely helpful in understanding the scope of the duty to preserve.

Judge Grewal opened his opinion with the following:

Ten years after Judge Scheindlin woke up the legal world from its electronic discovery slumber in the Zubulake series, plenty of other courts now have weighed in on when the duty to preserve electronic evidence attaches. With varying degrees of sophistication, most parties have gotten the basic message: the duty begins at least no later than the day they are sued and told about it. Less understood is exactly what a party must then do and by when. For example, while a suit against a particular CEO for sexual harassment would pretty clearly require that his relevant data be locked down at least by the time the company gets wind of the complaint, what must counsel do about less obvious players in a more abstract dispute? The motion before the court presents just such a question.

AMC Tech., LLC v. Cisco Sys., 2013 U.S. Dist. LEXIS 101372, 1-2 (N.D. Cal. July 15, 2013) [Emphasis added].

Here is the basic factual scenario of the case:

Defendant had a team negotiating a contract and royalty payments;

Employee not on the team contributed sales data for lead negotiator’s royalty payment schedule;

Employee kept his sales data on his computer and email;

Employee communicated by phone and email to negotiator;

Employee retired four days before Plaintiff files lawsuit;

Employee’s computer was wiped within the 30-day policy after someone leaves the company;

Neither party listed Employee as a custodian;

Defendant sought information from Employee slightly over one year from the filing of the lawsuit.

AMC Tech., LLC at *3-4.

The Plaintiff sought adverse inference instruction against the Defendant for what it called “reckless destruction of documents created by a key decisionmaker.” AMC Tech., LLC at *5.

The Court summarized its inherent authority over spoiliation as follows:

The court has “inherent discretionary power to make appropriate evidence rulings in response to the destruction or spoiliation of relevant evidence,” which arises out of its inherent power to direct “orderly and expeditious disposition of cases.” The range of appropriate sanctions is broad, and may take form in relatively minor sanctions, such as the award of attorney’s fees, to more serious sanctions, such as dismissal of claims or instructing the jury that it may draw an adverse inference. The court’s discretion is not, however, unbounded — it must weigh a number of factors to determine whether to grant sanctions, and if so, tailor the remedy according to the conduct that triggered the sanction. To determine whether to award spoiliation sanctions, the court considers whether the moving party has established: “(1) that the party having control over the evidence had an obligation to preserve it at the time it was destroyed; (2) that the records were destroyed with a culpable state of mind; and (3) that the evidence was ‘relevant’ to the party’s claim or defense such that a reasonable trier of fact could find that it would support that claim or defense.”

AMC Tech., at *6-7.

The Court had to answer the following question: Did the Defendant have an obligation to preserve the Employee’s computer/email at the time the ESI was destroyed?

The Court explained that there was “no question” that the ESI had to be preserved when the Plaintiff requested the ESI. This was not possible, since the ESI had been destroyed approximately 11 months earlier as part of the Defendant’s routine policy when an employee left the company. AMC Tech., at *7.

Had the duty to preserve already attached to the ESI prior to its deletion?

The Court explained the scope of the duty to preserve as follows:

A general duty to preserve evidence relevant to the litigation arises from the moment that litigation is reasonably anticipated. Because Cisco received notice of the complaint before McKeon’s documents were destroyed, and concedes that it had notice of the suit even before AMC filed the complaint on July 11, 2011, Cisco had a general duty to preserve evidence when it destroyed McKeon’s documents.

But the scope of this duty is not limitless. A litigant has an obligation to preserve only evidence “which it knows or reasonably should know is relevant to the action.” This duty requires a party to “identify, locate, and maintain, information that is relevant to specific, predictable, and identifiable litigation,” which includes identifying “key players” who may have relevant information and taking steps to ensure that they preserve their relevant documents. It is critical to underscore that the scope of this duty is confined to what is reasonably foreseeable to be relevant to the action. Requiring a litigant to preserve all documents, regardless of their relevance, would cripple parties who are often involved in litigation or are under the threat of litigation.

AMC Tech., at *7-9 [Emphasis added].

What did this mean for the Defendant and retired Employee? The Court explained the following:

AMC’s complaint plainly put Cisco on notice to identify and preserve documents that generally might reasonably be relevant to the AMC-Cisco Agreement, the Siebel Adapter, and the UCCX Connector. But should Cisco have known specifically that McKeon was a “key player,” such that his documents, just days before their demise, were relevant to the case? McKeon was an unlikely candidate to have documents relevant to the Agreement because he did not engage in negotiations of the Agreement in any way. Nor did he work on any internal committees deciding whether to commence the UCCX Connector project. He was merely the product manager for the underlying Cisco UCCX product. Although McKeon’s input might have informed Nijenhuis’ computation of the royalty schedule in the Agreement, which might be relevant to the issue of damages, these documents are only tangentially related to even that question because AMC does not allege that the royalty payment schedule was incorrect. Nothing in the complaint suggests that AMC would be making such a claim. Because Cisco could not reasonably have known that McKeon’s documents would be at all relevant to the litigation when those documents were destroyed, there was no duty to preserve them at that time.

AMC Tech., at *9-10.

The Court rejected the Plaintiff’s argument that the retired Employee was a “key player” that justified harsh sanctions. The Court zeroed in on the fact the Employee was just a project manager who had no role in the contract negotiations. Moreover, his data was not unique, because the Defendant produced its internal financial spreadsheets pertaining to the sales of the subject devices. Those files likely were created by the Employee. AMC Tech., at *12-13.

The Court held there was no prejudice to the Plaintiff and that the sanctions sought establishing full liability for the breach of the agreement to be “wholly inappropriate.” As such, the Court denied the Plaintiff’s motion.

Bow Tie Thoughts

Many litigation hold cases often have a theme where a party seeks to have the opposing party drawn and quartered for missing a tangential custodian. While Courts are supposed to get to the truth of a matter, they are not supposed to be a medieval battleground whenever a custodian is missed, but the relevant data still appears to have been produced. This is not the time to release the dragon to rain fire.

Litigation hold cases are fact intensive. They require asking the age old questions, “What did the President know and when did he know it?” This can require not just custodian interviews, but using ECA technology to see communication patterns to identify the key players involved in the dispute.

Judge Grewal conducted very detailed analysis on the timeline on this case and applying those facts to the law. This case is an excellent way to teach the scope of the duty to preserve. I encourage attorneys to read the full opinion.

Please Don’t Bates Stamp eDiscovery

This case is my eDiscovery nightmare.

Worse than a clown with snakes.

Let’s review what happened.

The case involved numerous allegations of discovery wrongdoing against the Plaintiff.

The Defendants brought a motion for “discovery abuses intended to harass defendants, cause unnecessary delay, and needlessly increase the cost of litigation.”

The Defendants claimed they had spent $51,122 in legal fees and expenses related to the Plaintiffs’ “document dump.”

The motion was granted and denied in part. Branhaven, LLC v. Beeftek, Inc., 2013 U.S. Dist. LEXIS 13364, 13-14, 22 (D. Md. Jan. 4, 2013).

It Started Like Any Other eDiscovery Dispute…

The litigation had the “traditional” eDiscovery dispute with the Plaintiffs not producing email ESI, because they had not accessed the information, and other significant production delays. As the rather hot bench explained:

Plaintiff’s delay in addressing the lack of access to these email servers is inexcusable. There is no more obvious and critical source of information in the 21st century than a company’s email accounts.  Plaintiff’s counsel’s failure to identify and produce this discovery in a timely fashion and in an acceptable form and manner while suggesting — if not misleading defendants — that it had identified responsive documents is sanctionable.

Branhaven, at *13-14.

Things continued to be problematic for the Plaintiffs, who claimed ESI from laptops would be produced in what the Court described as “blithely” assertions that discovery would be produced “at a mutually convenient time.” In reality, the subject laptops had not been sent to the client (presumedly to for review, raising the issue why hadn’t the hard drives been imaged), until a new associate attorney found them. Branhaven, at *14. Their conduct ultimately resulted in sanctions in the form of fees and costs.

…and then Came the PDFs and Whether the ESI Should Have Been Produced as TIFFs with Bates Numbers to be in a Reasonably Useable Form

The Plaintiffs produced their ESI as PDF’s. The Defendants challenged the production, because the production was untimely and not in TIFF format with Bates Numbers on every page. Branhaven, at *14-15.

The nightmare of a TIFF over a PDF production with Bates Stamps included the Plaintiffs arguing that the discovery request did not request Bates Stamps; nor is it an express requirement in the Federal Rules of Civil Procedure, case law or the local discovery guidelines. Branhaven, at *16.

Moreover, the Protocol for Discovery of Electronically Stored Information (Local Rules of District of Maryland) which states that TIFF is the preferred format is only advisory. The Court called this a “weak defense.” Id.

The Court stated the following on the production:

Moreover, as defendants point out, Fed. R. Civ. P. 34(b)(2)(E)(ii) provides two options regarding the form in which a party may produce documents and plaintiff did not satisfy either. The July 20 production was not in a form “in which it is ordinarily maintained” or in “a reasonably usable form” — as Mr. McNeil showed (especially considering the lateness of the production with depositions looming in a few days). The Advisory Committee Notes to Rule 34 warn that: “[a] party that responds to a discovery request by simply producing electronically stored information in a form of its choice, without identifying that form in advance of the production in the response required by Rule 34(b) runs the risk that the requesting party can show that the produced form is not reasonably usable . . .” (emphasis added). That is precisely what happened here. Branhaven did not advise of the intended form of its production in its March response. Defendant was blindsided by the volume of the documents (since the prior productions consisted of 388 pages). Moreover, defendants had every reason to think that the documents would be completely Bates-stamped, as prior productions were and further defendants had no reason to think that this production would be so incredibly voluminous, as to require special arrangements and explicit agreement.

Branhaven, at *16-17.

The crux of production issue was whether or not the PDF’s were in a reasonably useable form. The Court held they were not, because of the lack of Bates Numbers and the fact they were not in TIFF format. Branhaven, at *17. Additionally, because of the production, the Court awarded the Defendants “the reasonable litigation support costs involved in receiving and processing” the document production. Branhaven, at *19.

Bow Tie Thoughts

Why is this a case a nightmare for me? Because it applies a paper model of discovery to electronically stored information, requiring a conversion of ESI into a TIFF with Bates Stamps (a conversion which can triple processing costs with some service providers). What is even stranger about it is the form of production battle centered on PDFs vs TIFF, both of which are static images. One difference is a PDF can be either non-searchable (thus like a TIFF) or searchable (thus more like a native file).

Demanding electronically stored information be converted to a static image with Bates Numbers is right up there with demanding MP3s be reversed burned to 8 Track. A party should have a good reason to take a native file, that is fully searchable and strip its searchable features. This truly makes it like a piece of paper, rendering the review tools that can do everything from sorting data in chronological order to technology assisted review be useless. It is like trying to fuel a hybrid car with coal.

Removing ESI’s searchable features also violate the Federal Rules of Civil Procedure and a substantial body of case law.

Moreover, claiming there is a functional difference between PDF vs TIFF as static images is like fighting over VHS vs Beta. The problem with such fights is we are in the 21^st Century and not the 1970s. It is almost like arguing Beta is better than Video on Demand, because the issue is not the form, but whether you can analyze the content.

What drives these all too frequent fights? It is attorneys who want pieces of paper to have Bates Stamps. This worked up until the 1990s, but we now live in a world where the content on a smartphone can fill the first floor of a library. Data needs to be reviewed as data for there to be any chance to meaningfully understand its content. Moreover, as to the Bates Numbering to organize the ESI issue, native files can have a “control number” that is the functional equivalent of a Bates Number for management in a review platform. If there is still a concern about whether a file has been changed, parties can use MD5 hash values instead, to ensure the ESI has not been modified.

Finally, I believe forward thinking local rules are extremely helpful for litigants. However, as technology changes, these rules need to be updated to incorporate how computer-assisted review can cut costs, advances in processing or even the cost-effectiveness of remote depositions. What was forward thinking in 2006 can be outdated in 2013.

In the end, converting standard ESI like email to TIFFs to brand Bates Numbers should give lawyers nightmares of high processing costs, slow manual review and unhappy clients. It should only be done when the native file itself is not in a reasonably useable form, thus the static image is the only reasonably useable form.

No Expert Testimony, No Motion to Compel

A court should be hesitant to resolve issues that demand technical expertise.

Magistrate Judge James C Francis IV

In a case with dueling motions to compel, the parties disputed the adequacy of search terms. Magistrate Judge James C Francis IV wrote a profoundly important warning to attorneys and judges on search terms: A court should be hesitant to resolve issues that demand technical expertise. Assured Guar. Mun. Corp. v. UBS Real Estate Sec. Inc., 2012 U.S. Dist. LEXIS 167981, at *11 (S.D.N.Y. Nov. 21, 2012).

Neither of the parties submitted to the Court expert affidavits on the adequacy of the search terms. Judge Francis stated that expert testimony was “necessary for [him] to offer an opinion as to the most efficient, search protocol.” Assured Guar. Mun. Corp., at *12.

The Court noted that search term adequacy “is a complicated question involving the interplay, at least, of the sciences of computer technology, statistics and linguistics. Assured Guar. Mun. Corp., at *11-12, citing George L. Paul & Jason R. Baron, “Information Inflation: Can the Legal System Adapt?”, 13 Rich. J.L. & Tech. 10 (2007).

The Court also cited to the archangel of search term cases to highlight the difficulty in analyzing search term efficiency:

…for lawyers and judges to dare opine that a certain search term or terms would be more likely to produce information than the terms that were used is truly to go where angels fear to tread.

Assured Guar. Mun. Corp., at *12, citing United States v. O’Keefe, 537 F. Supp. 2d 14, 24 (D.D.C. 2008).

The Court stated the parties had three options:

They can cooperate (along with their technical consultants) and attempt to agree on an appropriate set of search criteria;

They can refile a motion to compel, supported by expert testimony; Or,

They can request the appointment of a neutral consultant who will design a search strategy.

Assured Guar. Mun. Corp., at *12.

Bow Tie Thoughts

eDiscovery requires expert knowledge. It is extremely dangerous for courts and parties to engage in determining search terms without having at least one expert who understands what technology to apply to a case to help attorneys make the legal determination what is relevant; identify what is responsive to discovery requests; and determine what ESI is privileged.

There have been too many eDiscovery opinions this year that most likely did not have an eDiscovery consultant assisting either party. I am greatly concerned the recent case management orders that limited parties to five search terms per custodian was purely an arbitrary number and lacked any expert involvement in analyzing the data before any such motion practice.

This is as dangerous as an accountant telling a doctor what procedures they can use to treat an emergency room patient before any triage takes place. The accountant is in no position to know what is best for patient care.

If determining search terms efficiency is the work of angels, limiting search terms without consulting an expert is embracing the dark ages at best and malpractice at worse. Why risk limiting your ability to find what is relevant to your case? Why risk driving up discovery costs by making searching for ESI harder?

Conversely, would any attorney agree to limiting their legal research to the arbitrary number of 3 terms and prohibiting the consultation of a research attorney to “lower costs”? Most likely no.

The answer to controlling eDiscovery costs is not limiting the tools to find what is responsive, but the education of attorneys and judges in understanding how to conduct eDiscovery. Highlighting the need for eDiscovery education, one recent opinion had a judge hold that TIFF’s are a form of production “that is easily searchable for specific terms.” Johnson v. Allstate Ins. Co., 2012 U.S. Dist. LEXIS 148282 (S.D. Ill. Oct. 16, 2012).

Tagged Image File Format is not searchable. Parties convert ESI to TIFF’s (usually at any additional processing cost) to make the native files not searchable. A production with TIFF’s would require extracted text, substantive and/or embedded metadata, or the TIFF’s to have optical character recognition (OCR) to be in a reasonably useable form without searchable features denigrated. Saying TIFF’s are searchable is simply wrong.

Judge Francis was profoundly correct when he stated, “A court should be hesitant to resolve issues that demand technical expertise.” eDiscovery requires attorneys being competent to understand their client’s ESI, which should involve having enough education on eDiscovery to know when to bring in an expert for help; determining whether or not search terms are effective requires such expert assistance.

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.

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.