Presentation on theme: "1 E-Discovery in Arbitration Presented by Terry F. Moritz 312.201.3903"— Presentation transcript:
1 E-Discovery in Arbitration Presented by Terry F. Moritz
2 Section 1 ADR Systems: Commercial Arbitration Rules Section 2 CPR Protocol on Disclosure of Documents and Presentation of Witnesses in Commercial Arbitration Section 3 JAMS Discovery Protocols Section 4 AAA Commercial Rules
3 ADR SYSTEMS: Commercial Arbitration Rules
4 Electronically Stored Information Basic Definitions Rule 8.4 Electronically Stored Information (“ESI”) – , web pages, word processing files, computer databases, or anything that can be stored on a computer. Active Data –Active Data is the information residing on the direct access storage media of computer systems, which is readily visible to the operating systems and application software with which it was created and immediately accessible to users without restoration or reconstruction. Backup Data –Backup data is an exact copy of the system data that serves as the source for recovery in the event of a systems problem or disaster. Backup data is generally stored separately from active data on portable media, for example, magnetic backup tapes or disks.
5 Data Filtering –Data Filtering is the process of identifying for extraction specific data based on specified parameters (e.g., by key word, file type, such as a name in the “to” field in an ). Legacy Data –Legacy data is information that was created or stored by the use of software and/or hardware that has become obsolete or replaced (such as a particular computer operating system that is no longer used). While the data itself may be important, Legacy Data may be costly to restore or reconstruct when required for investigation, or litigation analysis or discovery.
6 Metadata –Metadata is information about a particular data set or document that describes how, when, and by whom it was collected, created, accessed, and modified and how it is formatted (such as the Properties features in Windows that describes when a document was created or modified). Metadata is generally not reproduced in full form when a document is printed. It can be altered intentionally or inadvertently. It also may be extracted when native files are converted to image. Some metadata such as file dates and sizes can be seen easily by users; other metadata can be hidden or embedded and unavailable to computer users who are not technically adept.
7 Native Format –Native Format is the associated file structure of an electronic document defined by the original creating application. (For example, a document may have been created in WordPerfect but later converted to another program such as Word). PDF (Portable Document Format) –A PDF captures formatting information from a variety of applications in such a way that it can be viewed and printed as intended in its original application by practically any computer, on multiple platforms, regardless of the specific application in which the original was created. PDF files may be text-searchable or image-only.
8 Sampling –Sampling refers to the process of testing a database for the existence or frequency of relevant information. It can be a useful technique in addressing a number of issues relating to litigation, including decisions about what repositories of data are appropriate to search in a particular litigation and determinations of the validity and effectiveness of searches or other data extraction procedures. Slack Data –When a file name is deleted, the underlying ESI is not automatically erased from the hard drive. A partial overwrite of the file with new material leaves part of the original file intact, and forensically retrievable, as slack data. For more information, see generally the Sedona Principles 2nd Edition.
9 Electronic Document Production Mode A –Disclosure by each party limited to copies of electronic information to be presented in support of that party’s case, in print-out or another reasonably usable form. Mode B –Disclosure as provided for in Mode A together with ESI requested by another party which is shown to be significant to a matter of import in the proceeding and for which a party has demonstrated a substantial need. Such disclosure shall be in Native Format or PDF or in a manner reasonably accessible to the requesting party. Such disclosure is limited as follows: 1) The ESI is in reasonably usable form (in that it would not cause undue burden and expense to retrieve) and can be retrieved using basic Sampling and Data Filtering;
10 Mode B (continued) 2) The ESI was created between the date of the signing of the agreement that is the subject of the dispute and the date of the filing of the request for arbitration. 3) The ESI was created by or prepared for key players; 4) The ESI is Active Data, is information purposely stored in a manner that anticipates future business use, and permits efficient searching and retrieval. 5) Unless the arbitrator directs otherwise, no disclosure of Backup Data, Legacy Data, Slack Data or information from back up servers or backup tapes, information from cell phones, PDAs, voic s, text messages, etc. 6) No disclosure of Metadata.
11 Mode C –Same as Mode B, but covering a wider time period [to be specified]. Upon a showing of special need and relevance, disclosure of Backup Data, Legacy Data, Slack Data, Metadata, information from cell phones, PDAs, voic s, text messages, deleted or fragmented data or other information difficult to obtain other than through forensic means. If such data is to be produced, then, absent special circumstances, the costs of retrieving and reviewing such ESI shall be shifted to the requesting party. Mode D –Same as Mode C but covering all non-privileged ESI relevant to any party’s claim or defense. –Parties selecting Modes B, C, or D agree to meet and confer, prior to an initial scheduling conference with the arbitrator, concerning the specific modalities and timetable for electronic information disclosure.
12 CPR Protocol on Disclosure of Documents and Presentation of Witnesses in Commercial Arbitration
13 Philosophy Underlying Document Disclosure Whether or not the parties adopt any of the modes of disclosure as provided herein, parties whose arbitrations are conducted under the CPR Rules should understand that CPR arbitrators are expected to conduct proceedings before them in accordance with the general principle that arbitration be expeditious and cost-effective as well as fundamentally fair. Consistent with this philosophy, it is expected that the parties will ensure that their counsel appreciate that arbitration is not the place for an approach of "leave no stone unturned," and that zealous advocacy in arbitration must be tempered by an appreciation for the need for speed and efficiency. Since requests for information based on possible relevance are generally incompatible with these goals, disclosure should be granted only as to items that are relevant and material and for which a party has a substantial, demonstrable need in order to present its position. CPR arbitrators should supervise any disclosure process actively to ensure that these goals are met.
14 Party-Agreed Disclosure The parties to an arbitration may provide, in their agreement to arbitrate, or separately thereafter, for certain modes of disclosure they they and the tribunal will follow. Suggested modes are set forth in Schedule 1 hereto and may be agreed to by the parties in such language as the following: "The parties agree that disclosure of documents shall be implemented by the tribunal consistently with Mode I ] in Schedule 1 to the CPR Protocol on Disclosure of Documents and Presentation of Witnesses in Commercial Arbitration.“ If the parties have agreed on the applicability of any one of such modes, the tribunal shall issue orders for disclosure of documents pursuant to a time schedule and other reasonable conditions that are consistent with the parties' agreement.
15 General Principles – E-Disclosure In making rulings on disclosure, the tribunal should bear in mind the high cost and burdens associated with compliance with requests for the disclosure of electronic information. It is frequently recognized that and other electronically created documents found in the active or archived files of key witnesses or in shared drives used in connection with the matter at issue are more readily accessible and less burdensome to produce when sought pursuant to reasonably specific requests. Production of electronic materials from a wide range of users or custodians tends to be costly and burdensome and should be granted only upon a showing of extraordinary need. Requests for back-up tapes, or fragmented or deleted files should only be granted if the requesting party can demonstrate a reasonable likelihood that files were deliberately destroyed or altered by a party in anticipation of litigation or arbitration and outside of that party's document- retention policies operated in good faith.
16 Preservation of Electronic Information In view of the high cost and burden of preserving documents, particularly in the form of electronic information, issues regarding the scope of the parties' obligation to preserve documents for potential disclosure in the arbitration should be dealt with at an early scheduling conference, or as soon as possible thereafter. The parties' preservation obligations should comport with the Schedule 2 mode of disclosure of electronic information selected.
17 Tribunal Orders for the Disclosure of Documents and Information The arbitrators should ensure that they are sufficiently informed as to the issues to be determined, the burden and costs of preserving and producing requested documents and other information, and the relative value of the requested information to the issues to be determined, so as to enable the arbitrators to make a fair decision as to the requested disclosure.
18 Modes of Disclosure of Electronic Information Mode A –Disclosure by each party limited to copies of electronic information to be presented in support of that party's case, in print-out or another reasonably usable form. Mode B –1) Disclosure, in reasonably usable form, by each party of electronic information maintained by no more than [specify number] of designated custodians. –2) Provision only of information created between the date of the signing of the agreement that is the subject of the dispute and the date of the filing of the request for arbitration. –3) Disclosure of information from primary storage facilities only; no information required to be disclosed from back up servers or backup tapes; no disclosure of information from cell phones, PDAs, voic s, etc. –4) No disclosure of information other than reasonably accessible active data.
19 Modes of Disclosure of Electronic Information Mode C –Same as Mode B, but covering a larger number of custodians [specify number] and a wider time period [to be specified]. The parties may also agree to permit upon a showing of special need and relevance disclosure of deleted, fragmented or other information difficult to obtain other than through forensic means. Mode D –Disclosure of electronic information regarding non-privileged matters that are relevant to any party’s claim or defense, subject to limitations of reasonableness, duplicativeness and undue burden. Parties selecting Modes B, C, or D agree to meet and confer, prior to an initial scheduling conference with the tribunal, concerning the specific modalities and timetable for electronic information disclosure.
20 JAMS Discovery Protocols
21 E-Discovery JAMS understands the importance of establishing the ground rules governing an arbitration in the period immediately following the initiation of the arbitration. Therefore, following appointment, JAMS arbitrators promptly study the facts and the issues and become prepared to preside effectively over the early stages of the case in a way that will ultimately lead to an expeditious, cost-effective and fair process. JAMS arbitrators strive to enhance the chances for limited, efficient discovery by acting at the first pre-hearing conference to set hearing dates and interim deadlines which, the parties are told, will be strictly enforced, and which, in fact, are thereafter strictly enforced.
22 E-Discovery Where appropriate, JAMS arbitrators explain at the first pre-hearing conference that document requests: –should be limited to documents which are directly relevant to significant issues in the case or to the case’s outcome. –should be restricted in terms of time frame, subject matter and persons or entities to which the requests pertain, and –should not include broad phraseology such as “all documents directly or indirectly related to.” In any event, where all participants truly desire unlimited discovery, JAMS arbitrators will respect that decision, since arbitration is governed by the agreement of the parties.
23 E-Discovery The use of electronic media for the creation, storage and transmission of information has substantially increased the volume of available document discovery. It has also substantially increased the cost of the discovery process. There shall be production of electronic documents only from sources used in the ordinary course of business. Absent a showing of compelling need, no such documents are required to be produced from back-up servers, capes or other media.
24 E-Discovery Absent a showing of compelling need, the production of electronic documents shall normally be made on the basis of generally available technology in a searchable format which is usable by the party receiving the e-documents and convenient and economical for the producing party. Absent a showing of compelling need, the parties need not produce metadata with the exception of header fields for correspondence. Where the costs and burdens of e-discovery are disproportionate to the nature and gravity of the dispute or to the amount in controversy, or to the relevance of the materials requested, the arbitrator will either deny such requests or order disclosure on condition that the requesting party advance the reasonable cost of production to the other side, subject to the allocation of costs in the final award.
25 Rules Rule 17 Exchange of Information –a) The Parties shall cooperate in good faith in the voluntary and informal exchange of all non-privileged documents and other information (including electronically stored information (“ESI”)) relevant to the dispute or claim immediately after commencement of the Arbitration. They shall complete an initial exchange of all relevant, non-privileged documents, including, without limitation, copies of all documents in their possession or control on which they rely in support of their positions, and names of individuals whom they may call as witnesses at the Arbitration Hearing, within twenty-one (21) calendar days after all pleadings or notice of claims have been received. The Arbitrator may modify these obligations at the Preliminary Conference.
26 Rules Rule 17 Exchange of Information –c) As they become aware of new documents or information, including experts who may be called upon to testify, all Parties continue to be obligated to provide relevant, non-privileged documents to supplement their identification of witnesses and experts and to honor any informal agreements or understandings between the Parties regarding documents or information to be exchanged. Documents that were not previously exchanged, or witnesses and experts that were not previously identified, may not be considered by the Arbitrator at the Hearing, unless agreed by the Parties or upon a showing of good cause.
27 Rules Rule 17 Exchange of Information –d) The Parties shall promptly notify JAMS when a dispute exists regarding discovery issues. A conference shall be arranged with the Arbitrator, either by telephone or in person, and the Arbitrator shall decide the dispute. With the written consent of all Parties, and in accordance with an agreed written procedure, the Arbitrator may appoint a special master to assist in resolving a discovery dispute.
28 Rules Rule 29 Sanctions The Arbitrator may order appropriate sanctions for failure of a Party to comply with its obligations under any of these Rules. These sanctions may include, but are not limited to, assessment of Arbitration fees and Arbitrator compensation and expenses; assessment of any other costs occasioned by the actionable conduct, including reasonable attorneys’ fees; exclusion of certain evidence; drawing adverse inferences; or, in extreme cases, determining an issue or issues submitted to Arbitration adversely to the Party that has failed to comply.
29 AAA Commercial Rules
30 American Arbitration Association Commercial Rules 9.1 Subject to these Rules, the Tribunal may conduct the arbitration in such manner as it shall deem appropriate. The chair shall be responsible for the organization of arbitral conferences and hearings and arrangements with respect to the functioning of the Tribunal. 9.2 The proceedings shall be conducted in an expeditious manner. The Tribunal is empowered to impose time limits it considers reasonable on each phase of the proceeding, including without limitation the time allotted to each party for presentation of its case and for rebuttal. In setting time limits, the Tribunal should bear in mind its obligation to manage the proceeding firmly in order to complete proceedings as economically and expeditiously as possible.
31 American Arbitration Association Commercial Rules 9.3 b. The early identification and narrowing of the issues in the arbitration; c. The possibility of stipulations of fact and admissions by the parties solely for purposes of the arbitration, as well as simplification of document authentication; d. The possibility of appointment of a neutral expert by the Tribunal; and e. The possibility of the parties engaging in settlement negotiations, with or without the assistance of a mediator. After the initial conference, further pre- hearing or other conferences may be held as the Tribunal deems appropriate.
32 American Arbitration Association Commercial Rules Rule 11: Discovery The Tribunal may require and facilitate such discovery as it shall determine is appropriate in the circumstances, taking into account the needs of the parties and the desirability of making discovery expeditious and cost- effective. The Tribunal may issue orders to protect the confidentiality of proprietary information, trade secrets and other sensitive information disclosed in discovery.
33 Procedures for Large, Complex Commercial Disputes Preliminary Hearing –As promptly as practicable after the selection of the arbitrator(s), a preliminary hearing shall be held among the parties and/or their attorneys or other representatives and the arbitrator(s). Unless the parties agree otherwise, the preliminary hearing will be conducted by telephone conference call rather than in person. At the preliminary hearing the matters to be considered shall include, without limitation: the extent to which discovery shall be conducted; exchange and premarking of those documents which each party believes may be offered at the hearing; whether, and the extent to which, any sworn statements and/or depositions may be introduced; the procedure for the issuance of subpoenas.
34 Procedures for Large, Complex Commercial Disputes Management of Proceedings –The parties may conduct such discovery as may be agreed to by all the parties provided, however, that the arbitrator(s) may place such limitations on the conduct of such discovery as the arbitrator(s) shall deem appropriate. If the parties cannot agree on production of documents and other information, the arbitrator(s), consistent with the expedited nature of arbitration, may establish the extent of the discovery. –At the discretion of the arbitrator(s), upon good cause shown and consistent with the expedited nature of arbitration, the arbitrator(s) may order depositions of, or the propounding of interrogatories to, such persons who may possess information determined by the arbitrator(s) to be necessary to determination of the matter.
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