“What’s Going On?” (Introduction)
Electronic discovery jurisprudence continued its rapid evolution in 2013. Courts have increasingly accepted advanced technologies, including predictive coding/technology assisted review. Parties and counsel cannot assert lack of sophistication and understanding to justify e-discovery failures. And counsel cannot shift its own responsibility to the client or an e-discovery vendor. When working with others, follow-up is key. Ignorance is no excuse, as to case law, existing technologies, or client documents and data.
Courts have focused extensively upon procedural issues, including privilege, cooperation, search protocol, and diligence. Parties seeking to compel additional discovery or to pursue sanctions must meet their burden and avoid presumption. A party’s failure to utilize available means to reduce costs can result in significant consequences. In addition, cost-shifting and taxing of costs remain key issues. Social media continues to trigger discovery disputes as courts differ on the appropriate breadth of discovery (and the showing required to access private content), and parties learn that online activity can have significant ramifications. Courts have bound counsel to their promises, even when apparent that counsel did not understand the terminology at issue.
From the courtroom to the boardroom, no one is immune. Sanctions vary broadly – monetary sanctions, adverse inferences, document and witness exclusion, dismissal of claims or defenses, and more – but the fact remains that parties and their counsel each stand accountable for e-discovery compliance. Litigation holds are expected, counsel must “show their work” at all stages of e-discovery, and litigants should proactively address matters before the court. In the end, courts continue to encourage (or admonish, in certain instances) parties to plan ahead, to meet and confer in a meaningful way, and to cooperate whenever possible.
This article will focus on a few key issues worthy of continued attention into 2014.
“Anticipation” (When to Institute a Litigation Hold)
Although the word “anticipation” might bring to mind a hit song or Heinz Ketchup commercial for those old enough to remember them, the phrase “anticipation of litigation” once again played a significant role in e-discovery case law this year, especially in the context of determining when a party is required to institute a litigation hold. It is well settled that companies that delete e-mail and other electronic data are best served by doing so pursuant to written (and consistently followed) document retention and deletion policies. However, the question remains as to exactly when to override such policies with a litigation hold.
In In re Pradaxa Prods. Liab. Litig., 2013 U.S. Dist. Lexis 137235 (S.D. Ill. Sept. 25, 2013), the court followed the Seventh Circuit standard in stating that such duty to preserve arises when a party knew or should have known that litigation was imminent, as opposed to the “reasonably foreseeable” standard utilized in some other jurisdictions. The court further noted that even if improper deletion occurs, a lack of bad faith still factors significantly into a sanctions determination. When in doubt, parties are best served to implement a litigation hold. In SJS Distrib. Sys. v. Sam’s East, Inc., 2013 U.S. Dist. Lexis 147549 (E.D.N.Y. Oct. 11, 2013), the court was unconvinced that a party did not anticipate litigation at the time it failed to preserve e-mails after discovering a packaging discrepancy in a product shipment. In that instance, the court granted an adverse inference instruction against the party, and awarded opposing counsel its fees associated with the sanctions motion.
“You Can’t Always Get What You Want” (Proportionality)
Although a rolling stone might gather no moss, ongoing litigation has a way of accumulating significant e-discovery expenses. In some instances, e-discovery costs alone can exceed the amount in controversy in the underlying lawsuit. Thus, although certain information may fall within the scope of that “reasonably calculated to lead to the discovery of admissible evidence,” courts have tried to balance relevance and probative value with cost consideration in the context of proportionality. Even in a case involving large corporate parties. (Apple Inc. v. Samsung Elecs. Co. Ltd., 2013 U.S. Dist. Lexis 116493 (N.D. Cal. Aug. 14, 2013).) In this case, the court noted that it was generally skeptical of generalized claims of burden, but ultimately limited production upon a showing that the ESI was not reasonably assessable due to undue burden or cost.
In PTSI, Inc. v. Haley, 2013 PA Super. 130, 71 A.3d 304, 2013 P.A. Super. Lexis 751, 35 L.E.R. Case (BNA) 1380 (Pa. Super. Ct. May 24, 2013), the court rejected sanctions despite the deletion of critical electronic records after a preservation order was issued. The court reasoned that while the obligation to preserve electronic data requires reasonable and good faith efforts, it is unreasonable to expect parties to take every conceivable step to preserve all potentially relevant data. The court’s reasoning, of course, further underscores the need to “show your work” at every step in the e-discovery process. Proportionality also played a key role in a predictive coding context in In re Biomet, 2013 U.S. Dist. Lexis 84440 (N.D. Ind. Apr. 18, 2013), in which the court found that it would cost a million dollars or more to test the theory that predictive coding alone would produce a significantly greater number of relevant documents and refused to place such a burden on the producing party. In other words, if you try real hard, you’ll get what you need.
“Why Can’t We Be Friends” (Collaboration)
Although some view litigation as a war, courts are growing increasingly intolerant of counsel’s refusal to collaborate on e-discovery matters. Counsel are repeatedly admonished to proactively prepare for "meet and confer" sessions in order to have a substantive discussion. In AMC Technology, LLC, v. Cisco Systems, Inc., 2013 U.S. Dist. Lexis 101372 (N.D. Cal. July 15, 2013), the court refused to intervene in an e-discovery dispute until the parties could show that they had met and conferred in a meaningful way. Similarly, in ProconGPS, Inc. v. Skypatrol, LLC, No. C 11-3975, 2013 U.S. Dist. Lexis 47133 (N.D. Cal. Apr. 1, 2013), each party sought an order compelling the other side to comply with discovery obligations, while claiming to have fully complied with its own obligations. The court refused to intervene on the basis that the parties had not conferred in good faith regarding their outstanding production issues.
Of course, failing to cooperate can be costly. In Ruiz-Bueno, III v. Scott, 2013 U.S. Dist. Lexis 162953 (S.D. Ohio Nov. 15, 2013), the court so despised a party’s refusal to collaborate or share information about their search processes, that it allowed the opposing party to conduct “discovery about discovery.” The court warned that further noncooperation would lead to further sanctions. In the context of working together, courts have broadly upheld agreements amongst counsel, while showing little sympathy for counsel who refused to enter into a clawback agreement, only to need one following its own inadvertent production.
“Lean on Me” (Working with E-Discovery Vendors)
Given the constantly evolving nature of the electronic discovery technology and case law, most, if not all, counsel need a hand at some point in the process. Courts have previously noted a role that e-discovery vendors can play in helping counsel fulfill their ethical requirement of competence in this area. In Logtale Ltd. v. IKOR, Inc., 2013 U.S. Dist. Lexis 107727 (N.D. Cal. July 31, 2013), the court became so impatient with e-discovery failures that it threatened to appoint an e-discovery vendor to oversee production at the party’s expense. However, the court in Peerless Indus., Inc. v. Crimson AV, LLC, 2013 U.S. Dist. Lexis 2985 (N.D. Ill. Jan. 8, 2013), warned that counsel can go too far in its reliance upon e-discovery vendors. In response to counsel that responded to complaints by deferring to the vendor’s recommended process, the court found that counsel’s “backseat,” “hands-off approach” was “insufficient.” The court thus noted that while vendors often play a crucial role in electronic discovery, parties and counsel must remain engaged in the process and must take responsibility for complying with the rules.
“Right Place, Wrong Time” (Access to Private Social Media Content)
Courts have previously made clear that “what happens in Vegas” does not necessarily stay there. Social media postings have proven case determinative in countless situations especially (but not exclusively) in the personal injury context. Quite recently, when the daughter of an age discrimination plaintiff bragged about her father’s settlement on Facebook, telling his former employer to “SUCK IT,” the court tossed out the monetary settlement because her post violated the confidentiality provision in the settlement agreement. However, in many other instances, the social media posting occurs in the “private content” area of the website issue. Although courts initially seemed inclined to consider such content fair game, recent decisions have required a requisite showing prior to allowing further discovery on such “private” online content. In Potts v. Dollar Tree Stores, Inc., 2013 U.S. Dist. Lexis 38795, 117 Fair Empl. Prac. Cas. (BNA) 1352 (M.D. Tenn. March 20, 2013), the court held that parties do not have a generalized right to rummage at will through information a party has limited from public view. The court held that in order to obtain access to such information, a party must make a threshold showing that the requested information is reasonably calculated to lead to the discovery of admissible evidence. Finding a failure to do so, the court denied access to the private social media account at issue. Similarly, in Keller v. National Farmers Union Property & Cas. Co., 2013 U.S. Dist. Lexis 452 (D. Mont. Jan. 2, 2013), the court noted that such a threshold showing protects against the “proverbial fishing expedition,” and that a party that failed to satisfy this requisite threshold was not entitled to “delve carte blanche” into the opposing party’s social networking accounts. It is worth noting, however, that those who delete social media content do so at their own peril. In Gatto v. United Air Lines, Inc., 2013 U.S. Dist. Lexis 41909 (D.N.J. Mar. 25, 2013), the court granted an adverse inference instruction against a party who had deactivated his Facebook account despite a court order requiring him to allow access to it. Social media thus remains an increasingly fertile ground for discovery, albeit one subject to some limits and privacy protection.