Presentation on theme: "National Business Institute Seminar"— Presentation transcript:
1 National Business Institute Seminar Operate in Compliance with FRCP Rules Changes and Eliminate the Fear FactorCharles SkamserVice President of Business DevelopmentTrial SolutionsCell:
2 Standard DisclosureWe are not giving legal advice
3 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeAgendaWhat’s the Big DealRule 16 and 26: Preliminary ConferencesRule 26: Changes for Reasonably Accessible DataRule 26: Post Production Privilege AssertionRule 33 and 34: Specification of FormRule 45: SubpoenaSummaryQuestions and Answers
4 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeWhat’s the Big Deal?First Real Change to FRCP in 38 YearsPurpose was to account for increase in ESI without adding undo burden and/or associated costsForce Corporations to Do More eDiscoveryExample of $1B CorporationAverage of 556 Cases per Year50% or 278 Required eDiscovery of Some TypeThat all changed on December 1, 2006, when Rules 16 and 26 were amended to provide the court early notice of e-discovery issues.Under Rule 16(b), parties must “meet and confer” at least 21 days before the scheduling conference which, in turn, must occur within 120 days of filing a lawsuit.Rule 16(b) further states that the scheduling order must include “provisions for disclosure or discovery of electronically stored information”, while Rule 26(f) requires that parties “discuss any issues relating to preserving discoverable information and to develop a proposed discovery plan.”
5 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeWhat’s the Big Deal?Corporations can no longer leave e-discovery for later in the process.Thanks to the FRCP rule changes, they must now define and share their e-discovery plans at the “meet and confer” which occurs within the first 99 days of a case.Corporations are now obligated to do e-discovery on all 556 Cases.
6 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeLexisNexis Survey Results: The Association of Corporate Counsel 2007 Annual Meeting in late OctoberOne year later – 44%of corporate counsel report companies being unprepared for onset of revised federal rules for e-discovery20% of corporate counsel were unaware of whether or not their company was prepared for the amendments to the federal rules prior to implementation.Top ChallengesCommunicating with IT departments (27% )Finding budget to put systems and tools into place (25%)Getting buy-in from upper management on the importance of litigation preparedness (21%)Finding e-discovery staff with a good mix of IT and legal expertise (9 %)
7 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeLexisNexis Survey Results: The Association of Corporate Counsel 2007 Annual Meeting in late OctoberMisperceptions of the RulesThe survey also suggests that confusion still exists regarding certain elements of the new rules. For example, 70% of corporate counsel attorneys believe that the rules require them to produce documents in their “native file” format.This is an incorrect assumption, and it is up sharply (up 27 %) from last year’s response to the same question.Impact on Workload and CostWhile provisions of the new federal rules require early engagement by parties – particularly to discuss, agree upon and execute e-discovery, 76% of corporate counsel attorneys report that the new rules have not helped trim costs nor reduce the scope of discovery work for their companies.In fact, survey findings show that the new FRCP have created an increase in discovery workload for corporate America in most cases.For example, 73 % of survey respondents said that their company has seen an increase of up to 20 %in discovery workload as a result of the new rules since their implementation last year.
8 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeLexisNexis Survey Results: The Association of Corporate Counsel 2007 Annual Meeting in late OctoberPositive Steps TakenDespite challenges and misconceptions, many corporations appear to be taking the fundamental steps necessary to ensure their companies are compliant with the new rules. For example, 82%of respondents said their company has a document retention policy, two-thirds said they have implemented a formal legal holds process and more than 40 % said they have conducted employee training for compliance this year. Further, a quarter said they have hired an e-discovery counsel or ESI coordinator.Additionally, just over half of respondents said they have taken more elements of the discovery process “in-house” as a way to control costs and management of the discovery process.
9 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeThus far, approximately 105 e-discovery opinions were reported since December 1, The major issues involved in these cases break down as follows:25% of cases addressed discovery requests and motions to compel24% of cases addressed spoliation/sanction23% of cases addressed issues involving the form of production9% of cases addressed preservation/litigation holds7% of cases addressed attorney-client privilege and waiver6% of cases addressed production fees6% of cases addressed admissibility of electronic evidence
10 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeThe Significant CasesCourt Orders Defendant to Preserve and Produce Server Log Data Stored in RAMColumbia Pictures Industries v. Justin Bunnell , No FMC (JCx) (C.D.Cal. May 29, 2007), aff’d WL (C.D.Cal. Aug. 24, 2007).In a suit alleging copyright infringement, the plaintiff sought preservation and production of user IP addresses along with dates and times of user requests. The defendant argued that this data was temporarily stored in random access memory (RAM) and did not constitute electronically stored information (ESI.) The court held RAM data constituted ESI and was discoverable.Magistrate Finds Exhibits Inadmissible and Outlines Standards for Electronic Evidence AdmissibilityLorraine v. Markel Am. Ins. Co. , 2007 WL (D. Md. May 4, 2007).Plaintiffs brought suit to enforce an arbitrator’s award. The judge dismissed both parties’ dispositive motions without prejudice to allow resubmission with evidentiary support. The court held there is a five-point test in determining the admissibility of electronic evidence. ESI must be 1) relevant, 2) authentic, 3) not hearsay or admissible hearsay, 4) the “best evidence”, and 5) not unduly prejudicial. The court stated, “it can be expected that electronic evidence will constitute much, if not most, of the evidence used in future motions practice or at trial, [and] counsel should know how to get it right on the first try.”
11 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeThe Significant CasesCourt Orders Search and Production at Producing Party’s Own CostPeskoff v. Faber, 2007 WL , (D.D.C. Feb. 28, 2007).In a suit alleging fraud, breach of fiduciary duty, breach of contract, and conversion inter alia, the plaintiff argued that a previous electronic document production contained unexplained time gaps, suggesting problems with the original production. As a result, the plaintiff moved to compel discovery of additional . The court found in favor of the plaintiff, holding that accessible data must be produced at the cost of the producing party, unless the producing party can prove the documents are inaccessible.Court Considers Sanctioning Attorneys for Discovery AbusesQualcomm, Inc. v. Broadcom Corp., 2007 WL (S.D.Cal Sept. 28, 2007).During one of the last days of a patent infringement trial, cross-examination of the plaintiff's witness revealed the existence of relevant s that the court later held were "the tip of the iceberg" in an attempt to conceal over 200,000 pages of relevant s. The judge characterized the discovery abuses as, "an organized program of litigation misconduct" and ordered the plaintiff's attorneys to demonstrate why they should not be sanctioned, without use of documents protected by the attorney-client privilege.
12 NEW E-DISCOVERY FRCP RULES Best Practices are Now Potential MalpracticeThe Significant CasesCourt Denies Motion to Compel Deleted Stored on Backup TapesOxford House, Inc. v. City of Topeka , 2007 WL (D. Kan. Apr. 27, 2007).The plaintiff brought suit alleging that the defendant improperly denied several conditional housing permits. In responding to the plaintiff’s motion to compel, the court determined there was no obligation to preserve overwritten s before the likelihood of litigation. Moreover, the court used a cost-benefit balancing test to find that the production of the requested ESI would be unduly burdensome given the cost and likelihood of retrieval
13 Rule 16 and 26: Preliminary Conferences Changes in FRCP RulesRule 16 and 26: Pretrial ConferencesIn any action, the court may in its discretion direct the attorneys for the parties and any unrepresented parties to appear before it for a conference or conferences before trial for such purposes asexpediting the disposition of the action;establishing early and continuing control so that the case will not be protracted because of lack of management;discouraging wasteful pretrial activities;improving the quality of the trial through more thorough preparation, and;facilitating the settlement of the case.
14 PRELIMINARY CONFERNCESS Changes in the FRFCPRule 26(f)The new Rule 26(f) requires parties to meet early in the litigation process and confer about discoverable ESI and issues related to it.During this initial meeting, parties will discuss the discovery plan, which includes the following:What ESI will be relied on by the litigantsHow each party stores its ESIIn what form the information will be producedThe accessibility of the informationIssues related to privileged ESI
15 PRELIMINARY CONFERNCESS Changes in the FRFCPRule 26(f) CommentaryThe necessity for proficient ESI management becomes evident at this initial meeting. Attorneys for the litigants are responsible for knowing the details of their clients' information systems and retention policies.They will also need to know the ESI that their clients will rely on for claims or defenses and whether that ESI is accessible or potentially contains privileged information.Classifying information as "litigation sensitive" or "privileged" and indexing it for search and retrieval are information management steps that will help in this phase of litigation.Knowing where information is stored and processed not only will assist in keeping costs down but also will offer an advantage by providing some certainty when responding to the initial questions posed pursuant to Rule 26(f).The agreement made by the parties under Rule 26(f) will be adopted in a court order following a Rule 16(b) pretrial conference. Therefore, it is important to be able to answer these preliminary questions with some certainty.
16 Rule 16 and 26: Preliminary Conferences Changes in FRCP RulesRule 16 and 26: Scheduling and PlanningExcept in categories of actions exempted by district court rule as inappropriate, the district judge, or a magistrate judge when authorized by district court rule, shall, after receiving the report from the parties under Rule 26(f) or after consulting with the attorneys for the parties and any unrepresented parties by a scheduling conference, telephone, mail, or other suitable means, enter a scheduling order that limits the timeto join other parties and to amend the pleadings;to file motions; andto complete discovery.
17 Rule 16 and 26: Preliminary Conferences Changes in FRCP RulesRule 16 and 26: Scheduling and PlanningThe scheduling order may also includemodifications of the times for disclosures under Rules 26(a) and 26(e)(1) and of the extent of discovery to be permitted;provisions for disclosure or discovery of electronically stored information;any agreements the parties reach for asserting claims of privilege or of protection as trial-preparation material after production;the date or dates for conferences before trial, a final pretrial conference, and trial; andAny other matters appropriate in the circumstances of the case.The order shall issue as soon as practicable but in any event within 90 days after the appearance of a defendant and within 120 days after the complaint has been served on a defendant. A schedule shall not be modified except upon a showing of good cause and by leave of the district judge or, when authorized by local rule, by a magistrate judge.
18 Rule 16 and 26: Preliminary Conferences Changes in FRCP RulesRule 16: Subjects for ConsiderationAt any conference under this rule consideration may be given, and the court may take appropriate action, with respect to(1) the formulation and simplification of the issues, including the elimination of frivolous claims or defenses;(2) the necessity or desirability of amendments to the pleadings;(3) the possibility of obtaining admissions of fact and of documents which will avoid unnecessary proof, stipulations regarding the authenticity of documents, and advance rulings from the court on the admissibility of evidence;(4) the avoidance of unnecessary proof and of cumulative evidence, and limitations or restrictions on the use of testimony under Rule 702 of the Federal Rules of Evidence;
19 Rule 16 and 26: Preliminary Conferences Changes in FRCP RulesRule 16 and 26: Subjects for ConsiderationAt any conference under this rule consideration may be given, and the court may take appropriate action, with respect to(5) the appropriateness and timing of summary adjudication under Rule 56;(6) the control and scheduling of discovery, including orders affecting disclosures and discovery pursuant to Rule 26 and Rules 29 through 37;(7) the identification of witnesses and documents, the need and schedule for filing and exchanging pretrial briefs, and the date or dates for further conferences and for trial;(8) the advisability of referring matters to a magistrate judge or master;
20 Rule 16 and 26: Preliminary Conferences Changes in FRCP RulesRule 16: Subjects for ConsiderationAt any conference under this rule consideration may be given, and the court may take appropriate action, with respect to(9) settlement and the use of special procedures to assist in resolving the dispute when authorized by statute or local rule;(10) the form and substance of the pretrial order;(11) the disposition of pending motions;(12) the need for adopting special procedures for managing potentially difficult or protracted actions that may involve complex issues, multiple parties, difficult legal questions, or unusual proof problems;(13) an order for a separate trial pursuant to Rule 42(b) with respect to a claim, counterclaim, cross-claim, or third-party claim, or with respect to any particular issue in the case;
21 Rule 16 and 26: Preliminary Conferences Changes in FRCP RulesRule 16: Subjects for ConsiderationAt any conference under this rule consideration may be given, and the court may take appropriate action, with respect to(14) an order directing a party or parties to present evidence early in the trial with respect to a manageable issue that could, on the evidence, be the basis for a judgment as a matter of law under Rule 50(a) or a judgment on partial findings under Rule 52(c);(15) an order establishing a reasonable limit on the time allowed for presenting evidence; and(16) such other matters as may facilitate the just, speedy, and inexpensive disposition of the action.At least one of the attorneys for each party participating in any conference before trial shall have authority to enter into stipulations and to make admissions regarding all matters that the participants may reasonably anticipate may be discussed. If appropriate, the court may require that a party or its representatives be present or reasonably available by telephone in order to consider possible settlement of the dispute.
22 Rule 16 and 26: Preliminary Conferences Changes in FRCP RulesRule 16: Final Pre-Trial ConferenceAny final pretrial conference shall be held as close to the time of trial as reasonable under the circumstances. The participants at any such conference shall formulate a plan for trial, including a program for facilitating the admission of evidence. The conference shall be attended by at least one of the attorneys who will conduct the trial for each of the parties and by any unrepresented parties.Rule 16: Pre-Trial OrdersAfter any conference held pursuant to this rule, an order shall be entered reciting the action taken. This order shall control the subsequent course of the action unless modified by a subsequent order. The order following a final pretrial conference shall be modified only to prevent manifest injustice.
23 Rule 16 and 26: Preliminary Conferences Changes in FRCP RulesRule 16: SanctionsIf a party or party's attorney fails to obey a scheduling or pretrial order, or if no appearance is made on behalf of a party at a scheduling or pretrial conference, or if a party or party's attorney is substantially unprepared to participate in the conference, or if a party or party's attorney fails to participate in good faith, the judge, upon motion or the judge's own initiative, may make such orders with regard thereto as are just, and among others any of the orders provided in Rule 37(b)(2)(B), (C), (D). In lieu of or in addition to any other sanction, the judge shall require the party or the attorney representing the party or both to pay the reasonable expenses incurred because of any noncompliance with this rule, including attorney's fees, unless the judge finds that the noncompliance was substantially justified or that other circumstances make an award of expenses unjust.
24 Rule 26: Reasonably Accessible Data Changes in FRCP RulesRule 26(a): Provisions Governing Discovery; Duty of DisclosureParty Must Provide Description by Category and Location of All Documents, ESI, and Tangible Things In Their Control and Which They May Use to Support Their CaseRule 26(b)(2)(B): Discovery Scope and LimitsParty Need Not Provide ESI From Sources That Party Identifies as “Not Reasonably Accessible” Because of Undue Burden & Cost (Good Cause Exception)Rule 26(b)(2)(C): Limitations on DiscoveryIf Discovery Sought is Unreasonably Duplicative or Cumulative or Obtainable From More Convenient, Less Burdensome SourceIf Party Seeking Discovery Has Had Ample Opportunity to Obtain Information SoughtIf Burden or Expense of Proposed Discovery Outweighs The Likely Benefit, Taking Into Account Needs of Case, Amount in Controversy, Parties Resources, Importance of the Issues at Stake and Importance of Proposed Discovery In Resolving Issues
25 Rule 26: Reasonably Accessible Data Changes in FRCP RulesRules 26: Information Technology PerspectivePeriodic reassessment / reevaluation of requirements & selection criteria used (Criteria needs to be well defined- include both & IM).Senior Executive understanding and buy in is critical.Procedures to address changes in criteria, test & implement.Effort needs to be coordinated between Legal, IT, Audit.Backups –retention guidelines need to be explicitly spelled out in writing; Storage and space issues need to be addressed.Include requirements in new employee awareness training & notification to all employeesPeriodic testingAuto back up without employee intervention – key word scan.Centralization – Do you want to utilize technology to centrally archive, index, and make the searchable, accessed easily, and integrate with existing backup system?
26 Rule 26: Reasonably Accessible Data Changes in FRCP RulesRules 26: Subjects for ConsiderationWhat is Hard to Access Today May be Easy TomorrowWhat is Easy to Access Today May be Hard TomorrowCourts May Require NRA Log Similar to Privilege Log: Problem Is You Know Content of Privileged Data; You Do Not Know Content of NRA, Only Source or Type of DataDistinguish Between “Reasonably Foreseeable as Relevant” and “Reasonably Foreseeable as Discoverable”Courts Have Ability to Shift Costs for NRARequesting Party May Offer to Share or Pay Costs: This is Not Deciding Factor – Also Have to Consider Responding Party’s Costs and Burden in Reviewing Info for Relevance & Privilege
27 Rule 26: Post Production Privilege Changes in FRCP RulesRule 26(b)(5): Post Production PrivilegeNew Amendments define a procedure for resolving claims of privilege a party makes to a communication that, during discovery, it has inadvertently disclosed to another party.Prior to the December 2006 Amendments to the FRCP, the previous sole guideline for lawyers receiving inadvertently disclosed communications in a federal case was the requirement of Model Rule 4 (As amended from Formal Opinions and ) to notify the sender of the disclosure. With no restriction on the information's use, lawyers were free to use the contents of the communication, even if privilege had not been waived. The resulting loophole in privilege rules opened the door for bizarre results.
28 Rule 26: Post Production Privilege Changes in FRCP RulesRule 26(b)(5): Post Production PrivilegeIf information is produced in discovery that is subject to a claim of privilege or of protection as trial-preparation material, the party making the claim may notify any party that received the information of the claim and the basis for it. After being notified, a party must promptly return, sequester, or destroy the specified information and any copies it has and may not use or disclose the information until the claim is resolved.Under this rule, a receiving party must stop all use of inadvertently disclosed information subject to a claim of privilege once the producing party provides notice of such a claim.Rule 26(b)(5)(B) thus, on its face, represents a middle ground between the strict protections of Formal Opinions and and the freedom of use condoned by Model Rule 4.
29 Rule 26: Post Production Privilege Changes in FRCP RulesRule 26(b)(5): Post Production PrivilegeEthics aside, the plain language of the rule places the initial burden on the producing party, not the receiving party. Therefore, the recipient has no obligation to act until informed of the producing party's claim to privilege.Once the producing party has made its claim, however, the burden on the receiving party is much like those of the withdrawn Formal Opinions. The receiving party must immediately stop all examination of the documents, then must return them, destroy them, or submit them to the court under seal. Here the rule anticipates, perhaps for purposes of saving time, what the instructions of the sending lawyer might have been under the Formal Opinions.Finally, as suggested in Formal Opinion , the receiving party may request a determination of the privilege claim from the court.
30 Rule 33 and 34: Specification of Form Changes in FRCP RulesRule 33(d): Interrogatories to PartiesRule 33(d) is amended to specify that electronically stored information may qualify as appropriate business records from which an answer to an interrogatory may be derived or ascertained.Rule 34(b): FormRule 34 (b) is amended to permit the requesting party to designate the form or forms in which it wants electronically stored information (ESI) produced.The rule recognizes that different forms of production may be appropriate for different types of electronically stored information (ESI).Using current technology, for example, a party might be called upon to produce:Word processing documents (MS Word, Word Perfect)messages (Outlook, Lotus, Hotmail, Gmail)Electronic spreadsheets (Excel)Different image or sound files (i.e. very long list)Material from databases (Oracle, SQLServer, MSAccess, Lotus)
31 Rule 33 and 34: Specification of Form Changes in FRCP RulesRule 34(b): FormIf Requesting Party Does Not Identify “Form,” Party Must Produce ESI In Form In Which It Is Ordinarily Maintained Or Form That Is Reasonably Usable, But May Not Produce ESI In Form Less Useful Or Searchable Than Form In Which It Is Normally Maintained.Subjects for ConsiderationHow Will Paper Documents Be Produced?In spite of the fact that electronic documents have taken the front seat in discovery, paper documents still exist and must be considered during the production process. Ultimately paper and electronic documents will be used in the same manner throughout the post-production discovery process and they should be produced and integrated in a way that will facilitate their use. Some questions to be answered might include:Will you want hard copies or images produced to you? Images can be loaded directly into a database without the issue of receiving, storing and imaging large amounts of paper.Will the producing parties be scanning and OCRing (Optical Character Recognition) the paper document productions? If so, reaching an agreement that each party will produce images and OCR text for their production and that the parties will share in the costs may be an option that will save all parties time and money.
32 Rule 33 and 34: Specification of Form Changes in FRCP RulesSubjects for ConsiderationWhat Types Of Electronic Documents Make Up The Data Set?There may be word processing files, spreadsheets, , databases, drawings, photographs, data from proprietary applications, website data, voice mail, and much more. To understand what data should be produced in light of the issues specific to the subject case, it is necessary to understand what information is available in the different software applications (or types of documents).Such preparation mitigates the risk of discovering too late that the agreed upon production format is inadequate to provide the discovery needed to address and understand the issues in the lawsuit.
33 Rule 33 and 34: Specification of Form Changes in FRCP RulesSubjects for ConsiderationWhat Formats For The Production Documents Provide Access To The Data Necessary To Best Address Issues In The Case?To be sure the necessary data and information is produced in order to allow thorough analysis of the discovery documents, it is critical to understand how different types of documents are impacted by different processing and production format optionFor example, formulas are not viewable when spreadsheets are converted to image; blind copyees and the date read are not available when s are converted to image.The determination of whether or not that type of information is necessary should be made early in the discovery process. Considering in advance what options are available and determining the most useful production format for each data type is essential for negotiating production options.
34 Rule 33 and 34: Specification of Form Changes in FRCP RulesSubjects for ConsiderationWhat Types of Media Should Be Used To Produce And Receive Production Documents?There is a wide variety of media on which data can be stored and delivered. These might include CDs, DVDs, portable (external) hard drives, or flash drives. The choice of media can significantly impact the amount of time and expense that will be involved in analyzing and processing the data.It is possible that a particular type of hardware will be necessary in order to access and process the data. For example, a hard drive can hold a significant amount of data but will require a certain level of expertise and specific hardware to handle properly.On the other hand, CDs are universally accessible but do not hold much data. If a large amount of data is being produced, it may be better to receive the data on a hard drive and invest in the expertise and hardware necessary to handle that medium than to spend the time handling tens or hundreds of CDs individually.
35 Rule 45: Subpoena Rule 45 (d): Subpoena Changes in FRCP RulesRule 45 (d): Subpoena(1)(A) A person responding to a subpoena to produce documents shall produce them as they are kept in the usual course of business or shall organize and label them to correspond with the categories in the demand.(1)(B) If a subpoena does not specify the form or forms for producing electronically stored information, a person responding to a subpoena must produce the information in a form or forms in which the person ordinarily maintains it or in a form or forms that are reasonably usable.(1)(C) A person responding to a subpoena need not produce the same electronically stored information in more than one form.(1)(D) A person responding to a subpoena need not provide discovery of electronically stored information from sources that the person identifies as not reasonably accessible because of undue burden or cost. On motion to compel discovery or to quash, the person from whom discovery is sought must show that the information sought is not reasonably accessible because of undue burden or cost. If that showing is made, the court may nonetheless order discovery from such sources if the requesting party shows good cause, considering the limitations of Rule 26(b)(2)(C). The court may specify conditions for the discovery.
36 Summary Rule 16 and 26: Preliminary Conferences Changes to FRCPRule 16 and 26: Preliminary ConferencesEstablishes Guidelines to Meet and Discuss How to Handle ESIRule 26: Changes for Reasonably Accessible DataEstablishes Guidelines to What Data Has to be Accessible / ProducedRule 26: Post Production Privilege AssertionEstablishes Guidelines for What is Considered PrivilegedRule 33 and 34: Specification of FormEstablishes Guidelines for the Form in which ESI has to be producedRule 45: SubpoenaEstablishes Guidelines for Subpoena of ESI
39 RECENT DECISIONS IN E-DISCOVERY Required Form of ProductionWhat Is Easily Accessible Data Versus Inaccessible DataPrivilege IssuesImposition of Sanctions
40 PRESERVING DATA Backup Tapes Collection Chain of Custody Desktops and LaptopsServersPortable Phones and Digital AssistantsOther Media
41 ENSURING E-DISCOVERY COMPLIANCE AgendaPreservation NoticesMeet and ConferHow to and What to Ask for in Production RequestsProtective OrdersHow to Structure ProtocolsUsing Experts, Neutrals and Special MastersSummaryQuestions and Answers
42 ENSURING E-DISCOVERY COMPLIANCE Nothing in the December 2006 amendments to the FRCP changed the familiar common-law and statutory duties to preserve data. What the amendments did do is highlight the challenges faced in meeting those obligations when it comes to electronically stored information (“ESI”).During the next hour, we will present and discuss the relationship between data preservation and data collection and how to avoid doing the right things the wrong way or perhaps failing to do them altogether.
44 THE FIRST 99 DAYS Ensuring e-Discovery Compliance Review Document Retention PolicyNotify Data CustodiansCollect data from all sourcesDetermine case strategyIssue Litigation Hold NoticesCull – move irrelevant dataFinalize – custodians, searchterms, datesInterview CustodiansAnalyze – custodians, searchterms, datesDetermine final timeline and costsDetermine scope and cost toIdentify and PreserveAdvanced AnalysisDefine redactions andrefine duplication proceduresDetermine scope and cost tocollectDetermine scope and cost toprocess and/or reviewDocument proceduresDocument proceduresDocument Discovery Plan – Form 35Day 1Day 99Phase 1 - NotificationPhase 2 –Early Case AnalysisPhase 3 – Prep for Meet & Confer
45 PRESERVATION NOTICES The Preservation Letter / Notice Ensuring E-Discovery ComplianceThe Preservation Letter / NoticeIt is becoming commonplace for a party who seeks information in a dispute to issue a preservation letter to the adverse party that it will eventually be seeking information from.Many larger entities receive letters such as these on a regular basis. It is the position of this body that these letters should be viewed as an opening offer in a negotiation process that will ideally lead to a mutually agreed upon case management order that a judge or other authority will endorse.Both sides can benefit from early, upfront discussions regarding the scope of preservation.
46 PRESERVATION NOTICES The Importance of a Realistic Preservation Notice Ensuring E-Discovery ComplianceThe Importance of a Realistic Preservation NoticeWhen requesting that the other side preserve certain electronic data, it is vitally important that the request be tailored to cover only the documents that are important or relevant to one's case. If an extremely overbroad preservation letter is sent, it is possible that the judge or other authority presiding over the case will see this as a bad faith litigation tactic and not as a good faith offer to negotiate. In this case, it is possible to forfeit a favorable negotiation position.When responding to a preservation letter, it is important to avoid some common mistakes. For example, ignoring a preservation letter is not a particularly good idea, nor is sending off a retaliatory letter meant to inflame the situation. Consider sending back a "counter offer" outlining what preservation steps will be taken, and detailing the costs involved with full compliance as well, perhaps suggesting an in person "meet and confer." Most importantly, this should be viewed as a negotiation process.
47 PRESERVATION NOTICES Challenging a Preservation Notice Ensuring E-Discovery ComplianceChallenging a Preservation NoticeBecause the duty to preserve is rather amorphous and perhaps meant to be over-inclusive as a matter of public policy, it is important to carefully weigh the decision to contest a preservation letter if an agreement cannot be reached.There are many costs, some apparent and some not, in a long and drawn out mini-trial regarding the specifics of preservation.However, it has been suggested by some authorities in the e-discovery arena that a genuine dispute over the scope of preservation prior to the filing of a complaint might be an appropriate subject for a declaratory judgment action.
48 PRESERVATION NOTICES The Litigation Hold Notice Ensuring E-Discovery ComplianceThe Litigation Hold NoticeIn a typical scenario, receipt of a complaint is followed by the issuance of a litigation hold notice to employees and relevant third parties.A monitoring protocol is put in place a la′ Zubulake V. (See Zubulake v. UBS Warburg LLC , 229 F.R.D. 422 (S.D.N.Y. July 20, 2004)Consequently, data custodians will be alerted to the need to retain potentially relevant ESI and ensure it is not destroyed, deleted or altered. Corporate IT is hopefully reviewing routine computer operations to determine whether any settings need to be changed or policies altered to prevent the loss of data. (See FRCP 37).Counsel is busy preparing initial disclosures and making decisions regarding data accessibility. (See FRCP 26(a)(1)(B) and 26(b)(2)(B)).A team is dispatched to interview key custodians to determine where to find the ESI that is relevant to the litigation.Custodians are reminded to preserve potentially relevant ESI, wherever it resides; workstation, laptop or on the thumb drive casually lying on their desk.They are provided with a contact name in the event they recall an additional data source later. Depending on the scope of the litigation, all or some of these steps were taken in a short time frame in preparation for the FRCP 26(f) meet and confer during which counsel will be obliged to discuss the electronic discovery issues that impact the litigation. What next?
49 MEET AND CONFEREnsuring E-Discovery ComplianceWith the new Federal Rules of Civil Procedure (FRCP) now in place, the meet and confer conference is more critical than ever.The changes to Rule 26(f) confirm that when ESI is involved in civil litigation, parties cannot over-plan or over-communicate. This article will explain the various information gathering questions and issues that counsel should discuss during the pre-trial stages of a case in order to ensure a textbook handling of e-discovery matters.
50 MEET AND CONFER What do you need to discuss with your opponent? Ensuring E-Discovery ComplianceWhat do you need to discuss with your opponent?As the Committee Notes to Rule 26(f) succinctly state, the purpose of the amendment to Rule 26(f) is to "direct the parties to discuss discovery of electronically stored information during their discovery-planning conference."This "early case assessment" rule establishes a timeframe for discussing electronically stored information (ESI) issues early on in the case. However, the specific provisions of Rule 26(f) do not dictate a precise formula for electronic discovery planning. Rather, the Rule directs the parties to meet as soon as practicable (but no later than 21 days before a scheduling conference) to develop a plan that addresses essentially any and all foreseeable discovery issues.When you sit down face to face with your counterpart on the other side, what topics will you discuss? To what level of detail will you delve? How long will the discussion last? The FRCP provisions are silent when it comes to the specifics, so it is up to the litigation teams to collaboratively design their own discovery framework.
51 MEET AND CONFER What do you need to discuss with your opponent? Ensuring E-Discovery ComplianceWhat do you need to discuss with your opponent?At a minimum, attorneys should use the Rule 26 conference as an opportunity to:Clarify expectations regarding document preservation, search strategies, collection, keyword lists, processing, and cost-allocation.Establish which sources of data they expect to receive from their opponent, and the format in which they expect to receive it.Discuss how both sides will handle privileged documents.Raise issues pertaining to volume, cost, time, and other factors affecting the accessibility and burden of producing the data in their client's possession or control.Besides seeking to develop a discovery plan, proficient litigators will take a strategic approach to these seemingly innocuous meetings. Counsel should take this time to learn the opponent's perspective on e-discovery and exactly how savvy they are when it comes to the issues surrounding electronically stored information.
52 MEET AND CONFER Attorney Check List for Meet and Confer Ensuring E-Discovery ComplianceAttorney Check List for Meet and ConferPreservation PracticesWhat is being done to preserve ESI? Is a protective order necessary?Scope of DiscoveryWill there be any deviations from the default initial disclosures specified in Rule 26(a)?What file types and time range is the opposing party seeking?Who are the main data custodians the opposing party is interested in?What will be the timing for exchanging discoverable ESI?AccessibilityWhat type of data is the opposing party interested in? Backup tapes? Hard drives? Servers? Removable media?Deleted data?How easy will it be to access this data?Will the use of an e-evidence expert be necessary?Production of MetadataWhat fields will be exchanged for the various file formats?Costs & BurdensWho will bear the costs associated with gathering, restoring, and producing the ESI?
53 MEET AND CONFER Attorney Check List for Meet and Confer Ensuring E-Discovery ComplianceAttorney Check List for Meet and ConferForms of ProductionIn what format or formats will parties produce the ESI be?Privilege Issues & WaiverHow will parties handle inadvertently produced privileged documents?Variations from FRCP rulesAre there any local rules that apply in the jurisdiction?Inventory of opponent's IT infrastructureWhich operating systems and software packages were used to develop key data? Are those systems still in use?What are the opponent's document retention policies? Are they being enforced?OtherIs there any other information that may be important to the e-discovery activity in the case?
54 MEET AND CONFER What is the judge's role? Ensuring E-Discovery ComplianceWhat is the judge's role?Just as Rule 26(f) was amended to require the parties to discuss early electronic discovery issues at the outset of litigation, Rule 16(b) was amended to call for the results of such discussions to be reported to the judge. Specifically, the rule states that:"...the district judge, or a magistrate judge when authorized by district court rule, shall, after receiving the report from the parties under Rule 26(f) or after consulting with the attorneys for the parties and any unrepresented parties by a scheduling conference, telephone, mail, or other suitable means, enter a scheduling order that limits the time ... (5) provisions for disclosure or discovery of electronically stored information...“Practitioners should use the Rule 16(b) scheduling conference as an opportunity to ensure the court understands the potential technological issues involved in collecting, reviewing, processing and producing any electronic data requested by the opposing party. The purpose of this rule, according to the Committee Note, is "to alert the court to the possible need to address the handling of discovery of electronically stored information early in the litigation if such discovery is expected to occur."
55 MEET AND CONFER Use Meet and Confer to Your Advantage Ensuring E-Discovery ComplianceUse Meet and Confer to Your AdvantageBy directing counsel and the court to address electronic discovery matters early on, parties have the opportunity to advocate through education, thereby gaining credibility with the court and providing an opportunity for counsel to begin steering electronic discovery decisions in their clients' favor.To that end, counsel may use the Rule 16(b) scheduling conference to, at least preliminarily, flag concerns regarding any unresolved issues including accessibility, production format, production of specific metadata fields and handling of inadvertently produced privilege and trial-preparation protected information.Moreover, the conference gives counsel an opportunity to raise concerns about their opponent's preservation protocols. Lastly, counsel should come prepared with a potential timeline for discovery, including realistic timeframes for completing the collection, review, and production of the electronic data.As with the Rule 26(f) conference, counsel should not hesitate to enlist the help of an e-evidence expert with the background and training to effectively articulate the issues.
56 PRODUCTION REQUESTS Ensuring E-Discovery Compliance Rule 34. Producing Documents, Electronically Stored Information, and Tangible Things, or Entering onto Land, for Inspection and Other PurposesIn GeneralA party may serve on any other party a request within the scope of Rule 26(b):(1) to produce and permit the requesting party or its representative to inspect, copy, test, or sample the following items in the responding party's possession, custody, or control:(A) any designated documents or electronically stored information — including writings, drawings, graphs, charts, photographs, sound recordings, images, and other data or data compilations — stored in any medium from which information can be obtained either directly or, if necessary, after translation by the responding party into a reasonably usable form; or(B) any designated tangible things; or(2) to permit entry onto designated land or other property possessed or controlled by the responding party, so that the requesting party may inspect, measure, survey, photograph, test, or sample the property or any designated object or operation on it.
57 PRODUCTION REQUESTSEnsuring E-Discovery ComplianceRule 34. Producing Documents, Electronically Stored Information, and Tangible Things, or Entering onto Land, for Inspection and Other PurposesProcedure(1) Contents of the Request.The request:(A) must describe with reasonable particularity each item or category of items to be inspected;(B) must specify a reasonable time, place, and manner for the inspection and for performing the related acts; and(C) may specify the form or forms in which electronically stored information is to be produced.
58 PRODUCTION REQUESTSEnsuring E-Discovery ComplianceRule 34. Producing Documents, Electronically Stored Information, and Tangible Things, or Entering onto Land, for Inspection and Other PurposesProcedure(2) Responses and Objections.(A) Time to Respond. The party to whom the request is directed must respond in writing within 30 days after being served. A shorter or longer time may be stipulated to under Rule 29 or be ordered by the court.(B) Responding to Each Item. For each item or category, the response must either state that inspection and related activities will be permitted as requested or state an objection to the request, including the reasons.(C) Objections. An objection to part of a request must specify the part and permit inspection of the rest.(D) Responding to a Request for Production of Electronically Stored Information. The response may state an objection to a requested form for producing electronically stored information. If the responding party objects to a requested form — or if no form was specified in the request — the party must state the form or forms it intends to use.
59 PRODUCTION REQUESTSEnsuring E-Discovery ComplianceRule 34. Producing Documents, Electronically Stored Information, and Tangible Things, or Entering onto Land, for Inspection and Other PurposesProcedure(2) Responses and Objections.(E) Producing the Documents or Electronically Stored Information. Unless otherwise stipulated or ordered by the court, these procedures apply to producing documents or electronically stored information:(i) A party must produce documents as they are kept in the usual course of business or must organize and label them to correspond to the categories in the request;(ii) If a request does not specify a form for producing electronically stored information, a party must produce it in a form or forms in which it is ordinarily maintained or in a reasonably usable form or forms; and(iii) A party need not produce the same electronically stored information in more than one form.Non PartiesAs provided in Rule 45, a nonparty may be compelled to produce documents and tangible things or to permit an inspection.
60 PRODUCTION REQUESTS Checklist of Action Items Ensuring E-Discovery ComplianceChecklist of Action ItemsMap your Information TechnologyInfrastructureDevelop a Data InventoryPrepare a Litigation Response PlanModify Retention PoliciesConsider Technology OptionsInventory your Litigation PortfolioEnforce your Retention PolicyTrain your workforce
61 PROTECTIVE ORDERSEnsuring E-Discovery ComplianceA protective order may be sought by any person against whom discovery is sought, party or nonparty.Burden is on person seeking protective order to show that it is necessary "to protect a party or person from annoyance, embarrassment, oppression or undue burden or expense.Types of protective orders available:"That discovery not be had." (Rule 26(c)(1).)"That the discovery may be had only on specified terms & conditions, including a designation of the time or place." (Rule 26(c)(2).)"That certain matters not be inquired into, or that the scope of the discovery be limited to certain matters." (Rule 26(c)(4).)"That a trade secret or other confidential research, development, or commercial information not be disclosed or be disclosed only in a designated way." (Rule 26(c)(7).)
62 PROTECTIVE ORDERSEnsuring E-Discovery ComplianceThe Zyprexa Injunction FSupp2d, No. 07-CV-0504, 2007 WL (EDNY Feb. 13, 2007) demonstrates that a protective order does not guarantee that sensitive documents will not be disclosed improperly.And once documents are disclosed, there may be enforcement and free speech implications that prevent an injunction from being issued to enjoin any further dissemination.Corporate litigants therefore should:Be warned that sensitive documents may not be fully protected from disclosure by a protective order.Be advised that the process of producing documents in a litigation is anything but routine. Document productions should be accorded heightened attention and litigants must determine at an early stage how sensitive the documents are and what the consequences of their disclosure would be.Be vigilant from the outset and have a plan to protect documents from improper disclosure.Provide the court with concrete ideas to prevent dissemination of documents while simultaneously affording the adversary reasonable access to the documents.
63 PROTECTIVE ORDERS Corporate litigants therefore should: Ensuring E-Discovery ComplianceCorporate litigants therefore should:Insist on as much protection as possible from the court to protect the confidentiality of documents.Size-up their adversaries, including opposing counsel, experts and consultants to determine if there is a greater risk of disclosure. This requires an added level of due diligence as litigants must closely examine the background of everyone who will have access to the documents. Ask the pertinent questions: Does plaintiffs counsel have a track record for trying his case in the press? Has opposing counsel or any of their consultants or experts ever been sanctioned for violating protective orders? Does the expert or consultant have a track record of communicating with the media? Ask around. This type of due diligence may provide the litigant with a basis for seeking added protection from the court.Critically assess the level of interest in the community, and among public interest groups and reporters. This will provide a sense of the environment surrounding the issues in the case and help to assess the risk of improper disclosure.Explore methods to electronically protect documents from improper disclosure. This includes consulting with an electronic discovery vendor to determine the most secure way to produce documents. The vendor may be able to use software to withhold certain privileges, such as the ability to print, copy, or forward a given document. In the end, however, no technology can guarantee that documents will not be improperly disclosed.Where there's a will, there's a way, and one determined to distribute documents will likely find a way to do so
64 PROTECTIVE ORDERS Courts should: Ensuring E-Discovery Compliance Give serious thought to the content of protective orders and spell out the consequences of violating the order.Be willing to impose rigorous requirements to protect documents. Courts should be creative in this regard and consider suggestions from both sides of the case.Admonish litigants at the outset that there will be severe consequences for any deliberate violation of a protective order.Limit access to documents to as few individuals as is absolutely necessary and require that each party explicitly identify who will have access to the documents.Hold attorneys accountable for the actions of their experts and consultants through discovery sanctions. Such accountability would deter attorneys from turning a blind eye to experts or consultants who they suspect may disclose confidential documents. It would also discourage lawyers from using experts or consultants to disseminate documents to the media or on the internet to garner publicity for the case and to put pressure on the opposing litigants to settle -- a phenomenon that has been known to occur in large commercial litigation.Impose harsh sanctions on persons that deliberately violate protective orders.
65 HOW TO STRUCTURE ORDERS Ensuring E-Discovery Compliance
66 EXPERTS, NEUTRALS AND SPECIAL MASTERS Ensuring E-Discovery ComplianceExpertsWhen an expert is an eyewitness to material events in a case, or a party to an action, as opposed to being hired in anticipation of litigation, no work-product protection exists. E.g., a doctor who provides emergency treatment to an accident victim may be deposed as to the condition of the patient.Experts hired to assist in preparation for trial are treated differently depending on whether they will be called to testify at trial.(1) A party may learn by interrogatories the names of the experts his opponent expects to call, the subject matter on which the expert is expected to testify, and the substance of the facts and opinions to which the expert will testify.(2) Facts or opinions may be obtained from an expert who has been retained in anticipation of litigation but who is not expected to testify only "upon a showing of exceptional circumstances under which it is impracticable for the party seeking discovery to obtain facts or opinions on the same subject by other means." (Friedenthal § 7.6; Wright § 81)In addition to testifying and non testifying experts, courts have also identified a third category, informally consulted but not retained. Neither the opinions or identity of an informally consulted but unretained expert are discoverable without a showing of special circumstances.This is akin to a work-product type privilege.
67 EXPERTS, NEUTRALS AND SPECIAL MASTERS Ensuring E-Discovery ComplianceExpert ChecklistGet them the pleadingsDefine the scope of their effort ASAP to limit costsInvolve them in drafting pleadings, sitting in on relevant depositionsGive them adequate notice of deadlines and court datesDon’t write their opinionsAccept “the truth” as they report itRespond promptly to their messages/queriesDo not discuss substantive matters viaDon’t write a “draft” report until discussed by phone
68 EXPERTS, NEUTRALS AND SPECIAL MASTERS Ensuring E-Discovery ComplianceWhen you Hold the Smoking GunDon’t forget to designate your expertDon’t forget to lay a foundation for TestimonyEstablish chain of custodyGet your expert’s credentials in somehow, even if other side stipulates to expertiseUse familiar analogies and imagesWhen the Smoking Gun is Pointed at YouMuddy the waters (only ethically!)Challenge the expert’s credentials?Challenge the acquisition or analysis?Remember that analysis is interpretedWho else had access?Could evidence have been altered?Did the other side “stomp on the evidence?”
69 EXPERTS, NEUTRALS AND SPECIAL MASTERS Ensuring E-Discovery ComplianceWhen the Smoking Gun is Pointed at YouWere you properly noticed about the testimony?Ask no questions that you do not know the answer toPrepare your cross-exam with YOUR expertIdentify any weaknesses, even if you can’t disprove evidenceBe careful going beyond your knowledgeGeneral ProtocolKeep expert testimony short as possibleKeep it clearFollow a script – don’t ad libDon’t confuse your own expertPREPARE your expert
70 Summary Preservation Notices Meet and Confer Ensuring E-Discovery CompliancePreservation NoticesMeet and ConferHow to and What to Ask for in Production RequestsProtective OrdersHow to Structure ProtocolsUsing Experts, Neutrals and Special Masters
71 Questions and AnswersEnsuring E-Discovery Compliance
72 PRODUCING ELECTRONIC DATA Production FormatDe-duplicationSignature AnalysisHash AnalysisData CarvingFile FragmentsMeta DataPrivilege Issues
73 CONDUCTING FORENSIC ANALYSIS How to Assess Compliance with Discovery Requests and Completeness of Produced DataRegistry AnalysisEvent LogsLink FilesWiping ProgramsDetecting Data Hiding TechniquesAssessment of Preserving and Production TechniquesMetadata Analysis: Finding, Interpreting and EvaluatingFile SystemsHost File Metadata
74 COMPLIANT DATA RETENTION AgendaRetention IssuesDestruction IssuesSystemsData Structures and OrganizationSummaryQuestions and Answers
76 RETENTION ISSUES Business Requirements IT Requirements / Capabilities Compliant Data RetentionBusiness RequirementsWhat do you need to run the businessIT Requirements / CapabilitiesCompliance with the Changes to the FRCPIgnorance is no longer a justification for not retaining dataRetain or Destroy ConundrumIf you keep it, it is discoverableIf you Destroy it in an unreasonable manner (i.e. too short of a timeframe for your industry), the court may apply sanctions.
77 Retention Issues Recommended Approach to Retention Policy Compliant RetentionRecommended Approach to Retention PolicyGet the Support of your Executive Management (i.e. the Board of Directors)Hire an Expert to Guide the ProcessCreate a Task Force in every Pertinent DepartmentBusinessITLegalHRSet ExpectationsInvolve Everyone in the Company though Seminars and TrainingHave a Tracking SystemMeet every Month / Quarter to Review Compliance
78 DESTURCTION ISSUESCompliant Data RetentionRule 37(f) provides a statutory framework upon which organizations can now begin to model their policies of destroying electronic information in the ordinary course of business with less fear of fines and sanctions.Organizations wishing to implement a policy of data destruction through the routine operation of electronic information systems should first establish a well-defined destruction policy and clearly identify the legitimate business reasons that support the policy.This policy should be implemented on a consistent basis, across all sources of electronically stored information. Failure to do so could undermine the stated legitimate business reasons for the policy.Applying the policy on a consistent basis requires knowing what electronic information you have, and where you keep it. To that end, organizations should maintain an updated database showing all sources of electronically stored information, the type of information stored, and details, such as filenames and date ranges.Organizations must also establish the means by which they can quickly and adequately implement "litigation holds" on any electronic information that might be relevant to actual or reasonably likely litigation.
79 DESTURCTION ISSUESCompliant Data RetentionRule 37(f) provides a statutory framework upon which organizations can now begin to model their policies of destroying electronic information in the ordinary course of business with less fear of fines and sanctions.Organizations must also establish the means by which they can quickly and adequately implement "litigation holds" on any electronic information that might be relevant to actual or reasonably likely litigation.I recommend establishing and communicating a company-wide litigation hold policy that includes employees alerting corporate legal counsel of facts that are "reasonably likely" to lead to litigation, and, ideally, utilizing a document retention system that allows for the "tagging" of electronic records that are deemed subject to the litigation hold so as to prevent the inadvertent destruction of discoverable records.Organizations should also designate a single management-level employee to serve as the company's representative on the issue of the organization's destruction policy -- both the business reasons that support such policy as well as the measures undertaken in order to meet litigation hold requirements. This person will then serve as the organization's spokesperson on the facts that demonstrate "good faith" in connection with the organization's destruction policy.
80 SYSTEMS Firewall Compliant Data Retention EDD Systems Online Review SystemsCase ManagementRecords Retention SystemeDiscovery SystemsFirewall
83 DATA STRUCTURES AND ORGANIZATIONS Compliant Data Retention
84 DATA STRUCTURES AND ORGANIZATIONS Compliant Data RetentionAdditional Issues for ConsiderationNative vs. Other File FormatExample: Actual vs. a TIFF CopyNative File Format is the Recommended FormatMetadataIn some cases the “Smoking Gun” may be in MetadataWorst Cast is Metadata has to be retrieved and reviewedEmbedded FilesAnything attached to another FileExample: An Excel Spreadsheet attached to anEmbedded files are probably where all the “good stuff” is located
85 SUMMARY Retention Issues Destruction Issues Systems Compliant Data RetentionRetention IssuesDestruction IssuesSystemsData Structures and Organization