Electronic Discovery - Managing Documents and
Litigation Under the Amended Rules
By: Mark Henriques
Hypothetical
Ms. Hernandez sues Carolina Service
Company (“CSC”) for employment
discrimination. She is a 55 year old hispanic
female. CSC receives a discovery request
for all documents relating to Ms.
Hernandez’ employment.
What does CSC produce?
1965
Traditional paper documents.
1975
Traditional paper documents, PLUS data
compilations (for example, print outs
from a computer).
Today
Traditional paper documents, data
compilations, PLUS e-mails, Excel
spreadsheets, metadata and other
information that might have never been
reduced to paper.
Document Creation – 1990 versus 2008
Electronic
10%
Paper
7%
93+%
electronic
form only!
1990
Paper
90%
2008
Electronic
93%
Where do we look for guidance:
•
•
•
•
Sedona Conference
Judge Scheindlin’s Zebulake opinions
Advisory Committee Report
Recent Case Law / Reporters
Managing E-Discovery is crucial:
• Most new cases will involve e-discovery.
• Almost all newly created information is
stored electronically.
• Expensive and time consuming, but
potential source of key discovery.
Back to the hypothetical . . .
• Under the Rules, before discovery requests
are propounded:
- Lawyer consults with IT.
- Lawyer meets with opposing counsel.
IT Meeting
• Lawyer must obtain information about:
- Servers.
- Back up systems and tapes.
- Storage devices (Palm Pilots, Treos,
Thumb Drives, Laptops, etc.).
- E-mail retention.
Network Data Retention Architecture
Yahoo Email Account
AOL Email Account
PCs with Outlook
Local Server
Local Server
Local Server
IBM Compatible
J Kinsel Laptop
Exchange 5.5
M Ferrario Laptop
J Kurz Laptop
IBM Compatible
IServer C
Email Server
IBM Compatible
Workstation
Workstation
IBM AS/400
Virginia Data Center
Disk array
IBM AS/400
Disk array
Honolulu Mirror Center
Litigation Off Switch
Immediate stop
of the deletion of
email and other
electronic documents
Identify the KEY PLAYERS at CSC . . .
We’re meeting with them on Day 1!
The Litigation Holds begins with their e-mails,
documents and data.
Timeline under
FRCP Amendments
Scheduling Order may
include:
First 90-120 days after Service
modifications of
the times for disclosures
under Rules 26(a) and
26(e)(1) and of the extent of
discovery to be permitted;
Complaint Served
Rule 26(f) Meet
and Confer
(5)
provisions for
disclosure or discovery of
electronically stored
information;
Form 35 Report
(6)
any agreements the
parties reach for asserting
claims of privilege or
protection as trial-preparation
material after production;
RULE 16(b)
The order shall issue
as soon as possible
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.
Report of Planning Meeting
Rule 16(b)
Scheduling
Conference
(7)
(8)
Rule 26(a)1) Initial
Disclosures and
Discovery
Rule 26(f) – Meet and Confer
The Three “P”s
• Preservation of electronic information.
• Production of electronic information.
• Privilege issues.
Topics to Discuss
•
•
•
•
•
•
•
Topics for such discovery.
Time period for electronic discovery.
Various sources of each party’s electronic data.
Reasonable accessibility of such information.
Form of production.
Preservation of electronic information.
Privilege issues relating to such data.
Company
Data Systems
(from Convera website)
Office Documents
File Systems
Groupware Servers
Document Management
Databases
Multimedia
Scanned Materials
Intranets/Internet
Expert Systems
and more . . .
After Meet and Confer, present
suggestions to Judge at scheduling
conference.
Rule 16(b) Order
• May include e-discovery agreements.
• Helpful to avoid delay and excessive cost.
• 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.
Agreements to consider include:
• Clawback Agreements
• Quick Peek Agreements
Clawback Agreement
• An agreement that inadvertently produced
privileged material will be returned without
asserting waiver.
• Pitfalls.
Quick Peek
or “Sneak Peek”
• Allows review of data before privilege
review.
• After items are selected, they are reviewed
for privilege.
• Agreement that initial production does not
waive privilege.
• Pitfalls.
Also consider including:
• Preservation issues.
• Search terms.
• Plans to share or reduce costs.
Back to the hypothetical . . .
Ms. Hernandez worked at the company for 5
years:
- E-mails on back up tapes.
- Files on obsolete computers.
- Box of floppy disks.
- Old desktop/laptop.
Email Production Options
(not including privilege search/
assumes keyword relevancy search)
Active Files – July 2004 to Present
$50K
Archived files – Jan 2002- June 2004
Option A – Quarterly tapes
80-85%
$73K/year
$182.5K
Option B – Monthly Tapes
91-95%
$158K/year
$395K
$500K/year
$1.5MM
Legacy files – 1999-2001
Option A – Quarterly tapes
80-85%
Reasonably Accessible Data
If data is not reasonably accessible, burden
shifts to requesting party.
Need to show good cause because benefits
outweigh costs.
Attorney for CSC will want to:
• Determine if reasonably accessible.
• If not, identify sources not being searched.
• Continue to preserve.
To determine if data is “reasonably
accessible”:
• Conduct sampling of information.
• Depose IT person.
• Allow Court or third party inspection.
Parties then need to discuss:
• The costs and burdens of accessing the data;
• The needs that may establish “good cause”
for accessing the data if it is not reasonably
accessible; and
• Potential conditions on obtaining and
producing the information.
Factors to determine “good cause”:
• Specificity of the document request.
• Quantity of information available from other and more
easily accessed sources.
• Failure to produce relevant information that seems likely to
have existed but no longer available on more easily
accessed sources;
• Likelihood of finding relevant, responsive information that
cannot be obtained from other more easily accessed
sources;
• Predictions as to the importance and usefulness of the
further information;
• The importance of the issues at stake in the litigation; and
• The parties’ resources.
Back to the hypothetical . . .
• Producible data identified.
• Next, must decide the form of production:
- Native
- Paper
- TIFF files
- Interactive
Amendments to Rules 33(d) and 34
• Requesting party may specify the format.
• If no format specified, production should be
in the format in which the data is ordinarily
obtained or is reasonably useable.
Production buzzwords:
• Legacy data
• Metadata
Privilege Issues
• 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.
• A receiving party may promptly present the information to
the court under seal for a determination of the claim.
Recent Ruling: May 29, 2008
• Victor Stanley v. Creative Pipe Originally a
paper production
• Court ordered forensic experts to devise
search: came up with 5 pages of search
terms
• 165 privileged docs missed in review
• Too Bad!
Warning:
Rule 26(b)(5) does not change the
substance of current privilege law.
Proposed FRE 502 would address
this issue.
Rule 45: E-discovery changes also
apply to non-parties:
• A subpoena may now “command each person to
whom it is directed to attend and give testimony or
to produce and permit inspection, copying, testing
or sampling of designated books, documents,
electronically stored information, or tangible
things . . .”
• A subpoena may also “specify the form or forms
in which electronically stored information is to be
produced.”
Rule of Thumb for Production Format
• Hard copy (paper) documents – single page
TIFF or pdf files.
• Electronic data – Native format with all
metadata.
E-Mail Options:
Form
Problems
Hard copy print out
No Metadata
Single page TIFF
Loses connection with
attachments
Native
Privilege and redaction;
bates numbering
difficulties
Native .pst production favored by some
courts:
• Verisign: .pst produces in ordinary course
of business.
• CP Solutions: .pst to maintain connections
with attachments.
Excel Spreadsheets
• Excel spreadsheets are created to be “active” – with
cells that can be manipulated, calculated and sorted.
• Static TIFF or hard copy production disables this
interaction.
• Williams: Improper to lock cells and scrub
metadata.
Is the format searchable?
• TIFFs on DVDs
- Pro: Ordinary course of business
- Con: Difficult to search.
Courts differ . . .
• Residential Contractors:
- Must provide index or table of contents.
• Eastman Kodak:
- If produced in ordinary course of
business, further formatting or indexing not
required.
Is the Data Accessible?
Judge Scheindlin’s Hierarchy
Most accessible
to
Least accessible
Active, online data
Near-line data
Offline storage/archives
Back up tapes
Erased, fragments or
damaged data
Rule of Thumb
Explain to the Court what was searched and what
would be required to obtain the data.
Peskoff: Judge ordered affidavit regarding back
ups.
Quinby: Judge allowed cost shifting for some
restoration and searching of back-up tapes.
Sanctions
• Most Commonly Sanctioned Behavior:
- Destruction of evidence (84%)
- Delayed production (16%
Most Common Sanction:
-Attorney’s fees and costs are the most commonly
granted sanction (60%)
- Evidentiary preclusion (30%)
- Adverse inference instructions (23%)
- Dismissal or default (23%)
Extreme Cases
Plasse: Plaintiff’s bad behavior included: deleting files,
failure to produce files, modifying files, manipulating
metadata. Case dismissed, Plaintiff ordered to pay
sanctions.
Krumwiede: Spoiled evidence by modifying, altering,
deleting and accessing thousands of files. Default
Judgment.
Samsung: Document retention policy put in place because
of threatened litigation – led to wrongful destruction of
evidence. Sanctions.
Adverse Inference Instruction
You have heard that UBS failed to produce some of
the email sent or received by UBS personnel in
August and September 2001. Plaintiff has argued
that this evidence was in defendants’ control and
would have proven facts material to the matter in
controversy.
..continued
Adverse Inference Instruction (cont.)
If you find that UBS could have produced this
evidence, and that the evidence was within its
control, and that the evidence would have been
material in deciding facts in dispute in this case,
you are permitted, but not required, to infer that the
evidence would have been unfavorable to UBS . . .
Managing Litigation Holds
• Need a tracking tool
• Outside counsel can help manage / maintain
privilege / advise on hold
• Womble E-Discovery Suite and EDiscovery counsel services
We built the e-Discovery Site in four segments.
Here we address the Litigation Hold Management
System and our use of Microsoft’s SharePoint®
product. The system might be fairly described as a
Project Management system coupled to a SQL
database. We customize the system for each client
to match the client’s Litigation Profile and its
computer and data storage systems.
We utilize Microsoft’s SharePoint® product as our
collaborative platform to support the LHMS
customization and continued delivery of legal
services associated with the day-to-day use of the
LHMS.
<Click to go back one page>
Site Segments:
Litigation Hold Management System
E-Discovery Processes
E-Discovery Resource Pages
SharePoint® Collaborative Platform
<Click to go to next page>
Page 3 of 13
Litigation Hold
Management System
Our continual development and refinement of the
Litigation Hold Management System is guided by
The Sedona Conference’s August 2007 Commentary
on Legal Holds: The Trigger and the Process.
The Commentary emphasizes that litigation hold
policies and practices should be tailored to a
client’s individual needs. We designed the LHMS,
including its four foundational components, to
permit customization consistent with the Sedona
advice.
The guidelines are not intended and should not
be used as a “checklist” or set of rules that are
followed mechanically. Instead, they should
guide entities in articulating a policy for
implementing legal holds that is tailored to their
individual needs.”
www.thesedonaconference.org
Litigation Hold
Litigation Hold HUB Page
A User of the Litigation Hold Management
System (LHMS) navigates from the
Litigation Hold Hub Page.
From this Page she can access the 4-Step
procedure for each individual Hold
consideration.
Collaboration between a client and Womble
Carlyle attorneys on the development of
system foundations, and then later on
specific Hold matters, takes place on clientspecific SharePoint® sites and subsites.
The LHMS employs a SQL database.
Consequently, reporting options are
essentially limitless. The system includes
a series of three Dashboard Reports
designed for core management of all Holds.
Litigation Hold
Core Procedures
The LHMS’ core procedure directs a User through
the Hold decision, the Hold design—at both the
general and task-specific levels—and then permits
management of activity within a Task.
The critical component for the process is the
Litigation Hold Protocol, or actually a series of
Protocols that match the types of litigation and
regulatory matters identified in the client’s Litigation
Profile.
Litigation Hold: Dashboard Reporting
A User can view her Litigation Hold database at three levels: All
Holds, Tasks within a Hold, and Activity on a specific Task. These
reports provide the Dashboard views for managing the Litigation
Hold lifecycle.
The beginning view typically will be the All Holds display. A User
can filter the view to display all Holds or any selected status. For
instance, if the User is looking for Pending Holds only, she may
apply the left-side menu to filter the view to show only Pending
Holds.
By clicking on a selected Hold matter, the User calls the Tasks
summary for the Hold. The User can continue to navigate to the
Activity level on a particular Task.
E-Discovery Services
e-Discovery Processes
1 Vendor Selection
2 Vendor Management
3 Systems Mapping
4 Data Preservation
5 Data Collection
6 Early Processing
7 Search/Data Analytics
8 Relevance and Privilege
9 Production Format/Delivery
10 Affirmative Discovery
11 3rd Party Discovery
12 Data Management
This segment of the Site targets the management
of e-Discovery within individual cases. We
designed the segment for Womble Carlyle’s
e-Discovery Team members.
Each of the 12 processes incorporates one or
more protocols. For instance, the Data Collection
protocols specify recommended practices for
collecting various types of electronic data.
An authorized Site user who is assigned to a
specific case in the system will have access to
this segment. Clients likewise may be assigned
access, primarily to provide management
transparency.
E-Discovery Services
e-Discovery Resource Pages
The Site includes as many as 30 Resource Pages
(this segment continues to expand).
The e-Discovery Resource Pages are available to
all Womble Carlyle attorneys, and can be made
available to clients.
A Resource Page focuses on a particular
e-Discovery topic. For example, one Page deals
exclusively with the recent Federal Rules
amendments; another targets the Rule 26
Conference preparation; and one Page covers the
Evidentiary Challenges of e-Discovery.
The Resources Pages reside on the SharePoint®
side of the Site. We selected SharePoint® for this
function because Microsoft designed
SharePoint® for easy management of shared
document libraries—precisely the requirement for
our Resource Pages.
OLD
CORPORATE
LITIGATION MODEL
Corporate
General Counsel
14
Outside Law
Firms
OLD
CORPORATE
LITIGATION MODEL
E-Discovery
Component
Outside Law
Firms
(with E-Discovery)
Corporate
General Counsel
E-Discovery
Component
15
NEW
CORPORATE
LITIGATION MODEL
Corporate
General Counsel
E-Discovery
consolidated with
e-Discovery counsel
E-Discovery
Counsel
16
Outside
Law Firms:
Trial Counsel
Litigation Hold System +
E-Discovery Counsel
17
1. Systems Mapping
▲▲▲
2. Data Preservation
▲▲
3. Discovery about ESI
▲▲
4. Rule 26(f) Conference
▲▲
5. Data Collection
▲
6. Early Processing
▲
7. Search/Data Analytics
▲
8. Privilege Management
▲
9. Process Audit Capability
▲▲
Mark P. Henriques
Womble Carlyle Sandridge & Rice, PLLC
3500 One Wachovia Center
Charlotte, NC 28202
Phone: (704) 331-4912
Fax: (704) 338-7830
E-mail: mhenriques@wcsr.com