4. Sources of the highest costs of e-discovery
Sources b - e are covered in more detail throughout the webinar
a) Using backup tapes – just barely good for disaster recovery
b) Privilege foul-ups – losing the protection provided by
privilege
c) Overlapping business & personal texting & emails –
poor or non-existent policy management
d) Cost-shifting – towards yourself because you don’t know
how to use the rules to your advantage
e) Angering the judge – not following e-discovery best
practices is a sure way to incite the wrath of the court and
possibly lose the case
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8. 1st some background so you can better understand the
overlooked issues
! ESI is divided into 5 categories (see Zubulake)
! ESI grouped into 2 tiers – Rule 26(b)(2) -- based on
effort & cost needed to access ESI
1. reasonably accessible
2. not reasonable accessible (NRA)
" Keep these categories in mind when requesting ESI or
responding to a request
" But these 5 categories may be obsolete or incomplete with
cloud computing, Google Docs, and other new storage
environments
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9. ESI: 5 Categories & 2 Tiers
Tier 1: Reasonably accessible
1. Active, online data: hard drives, active network servers
2. Near-line data (near online): optical disk & mag tape
3. Offline storage & archives: magnetic tape or optical disks;
referred to as JBOD (just a bunch of disks)
Tier 2: NRA – but you may need to produce if good cause is shown
4. Backup tapes, commonly using data compression
5. Erased, fragmented, or corrupted data
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10. Sanctions
Sanctions can be wide-ranging – and include any or all of the
following:
! Cost shifting
! Adverse inference
! Losing the case
! Losing an otherwise winnable case
! Look at 2010 Pension Committee Case for guidance on
these issues
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11. Agreements
Parties may attempt to reduce costs by
entering into agreements that will protect
against inadvertent disclosure of privileged
or protected ESI
1. Quick-peek
2. Attorney eyes only
3. Clawback agreements
4. FRE 502
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12. #3. Prepare for a swift & strong response to litigation
by knowing the rules
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13. Rule 1
! Often overlooked rule
! Provides for the goal in every action:
! Just
! Speedy
! Inexpensive
" Reduction of costs through best practices
" Proper planning
" Possible cost shifting
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14. Rule 16(b)
! Search for relevant ESI must be done no later than the first
pre-trial discovery meeting--within 99 days of the filing.
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15. Rule 26(a)(l)
! Requires an exhaustive search for all ESI, including e-mail
that’s "in the possession, custody, or control of the party."
! must be disclosed "without awaiting a discovery request”
! "in the possession, custody, or control of the party" has not
been interpreted by the courts
! Requires presenting a copy or description by category &
location of all ESI that the disclosing party may use to support
its claims or defences.
! Can an employee’s laptop or BlackBerry device be
considered under the control of the company, even if it’s in
a remote location?
! Where is it all located?
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16. Rule 26(b) – Meet and Confer
! Must be properly prepared for this meeting
! Involves IT and Lawyers to properly prepare
! Cases can be won or lost
! Must prepared with what you want and what you
don’t want to give up
! Court may issue proper orders to
! Protect
! Preserve
! Disclose
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17. Rule 30(b) Witness
! A party with ESI should designate a Rule 30(b) witness
! This avoids numerous and duplicative depositions of employees
! It is imperative to educate this person on the ESI issues so they may properly be
deposed on the technology/practices issues (See Pension Committee Case)
! Which files were searched
! How the search was conducted
! Who was asked to search
! What they were told and
! The extent of supervision
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18. Rules 33 and 34
! Rule 33(d) allows party to specify records to be
reviewed and location as well as ability to copy
! Rule 34(b) allows a party to specify the form of ESI
to be produced.
! Responding party may object to the form
! If no form is requested, then
! the form is normally maintained
! a form that’s reasonably useable
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19. Rule 37(e) Safe harbor
! Courts may sanction under “inherent power” or Court Rules
! Courts may not sanction parties for ESI "lost as a result of
routine, good faith operation of an electronic information
system."
! To come within the protection of Rule 37(e), a company would
have to show that:
(1) ESI was lost due to the routine operation of an IS, and
(2) the routine operation of the IS was operated in good faith
(3) The extent of sanctions is based upon a continuum of
Fault from simple negligence to gross negligence to
wilfulness/reckless conduct. (Pension Committee Case)
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20. Rule 45
! Rule 45 applies to non-parties who can
be subpoenaed to provide relevant ESI
that is is their possession. This can be
quite costly and often results in requests
for cost shifting. Examples:
! Yahoo
! AOL
! Verizon
! Similar third parties
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21. #4. The 3 R’s of e-discovery:
reasonableness, readiness & ROI
Case law illustrates these 3 concepts
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22. Antithesis of reasonableness: Failing to disclose
Qualcomm Inc. v. Broadcom Corp., 2007
! opinion recommending sanctions for failure of a party
to disclose 200,000 emails prior to trial
United Medical Supply Co. v. US, 2007
! sanctions imposed for failure to adequately preserve
ESI because of faulty e-mail communication with
contractors
There’s virtually no upper-bound on costs & crises when you’re
unprepared for litigation or are unable (or don’t know how) to
manage e-discovery and meet deadlines.
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23. Zubulake v. UBS Warburg, 2003 – 2005
employment discrimination
! You don’t need to preserve ESI on backup tapes that are
not reasonably accessible (NRA) and beyond the normal
retention times established by your company policy.
2 possible exceptions are:
! If you can identify backup tapes where specific employee
ESI is stored, then you must preserve those tapes, whether
the tapes are reasonably accessible or not.
! If backup tapes are actively being used for info retrieval,
then the tapes would likely be subject to a litigation hold.
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24. Zubulake v. UBS Warburg, 2003 – 2005
employment discrimination
! If you ask that your opponent pay for production
costs (cost-shifting), your request should be
reasonable
! Analysis of the work and costs involved should be
grounded in fact, for example based on the
results of, ESI data sampling rather than
guesswork. You should be able to back up your
request with specifics of what you need, with a
specific dollar amount.
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25. Zubulake v. UBS Warburg, 2003 – 2005
employment discrimination
Bottom line …..
At the end of the day, the duty “rests with the party”
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26. Qualcomm v. Broadcom, 2008
patent dispute
3 clear warnings about e-discovery misconduct
1. very expensive & stupid
2. can change the outcome of a case
3. by attorneys might subject them to discipline affecting their
license to practice
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27. Lessons from Qualcomm v. Broadcom, 2008
! Prepare your expert witness and make sure your expert can
answer questions
! Know what your expert witness knows. Hearing it for the first
time in court is dangerous.
! Design, validate, & make sure you understand the data map
to minimize the risk of failing to identify & search storage
media containing responsive ESI
! Don’t lie
! Consult external & objective IT experts for their opinions &
help in explaining tech issues
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28. Victor Stanley v. Creative Pipe, 2008
copyright infringement
Lessons from Grimm’s opinions
! Be able to show your work
! Use a reasonable, transparent & defensible ESI review methodology
! Find and fix your inadvertent disclosures promptly
! Your counsel should cooperate in attempting to reach non-waiver
agreements
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29. Litigation Hold
There is a duty to preserve potentially relevant ESI when litigation
may be “reasonably anticipated”
! This duty is to both discover and preserve
! Must know what and where it is
! Exists before the lawsuit is filed
! Court can issue Preservation Order, but duty may exist
without it
! Best practices and procedures become important in
identifying the what & where
! 2010 Pension Committee case attempts to set or at least
explain standards applicable to litigation holds and
oversight by counsel
! Need timely written notice for paper and electronic
! Create mechanism for collection and preservation so they
can be searched by others
! Instructions to “immediately suspend destruction”
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30. Protecting Privilege, Privacy & Work Product
If you get it, can you use it?
! Must disclose all relevant ESI
! May not have to disclose relevant ESI if it’s privileged or
protected (work product)
! Even if not disclosed, you must prepare a privilege log to
identify what you have, who created it, and why you claim it’s
protected.
! If a party objects to your claim of protection, the judge will
make a determination
! Use of Internet can help keep costs down
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31. Obligation when inadvertent ESI is involved
If you have inadvertently disclosed, or under the circumstances it’s
clear that disclosure was inadvertent, then notify the recipient.
! Recipient must return, sequester or destroy the ESI
! If the recipient disseminated it, then there is a duty of retrieve
! The recipient may send the ESI to the court to be sealed until
the claim of privilege or protection is determined by the court
! Some courts have held that it is both a legal and ethical duty
to notify the responding party if you receive what you know or
have reason to believe is inadvertent disclosure of privileged
or protected ESI
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32. FRE Rule 502
! Treats inadvertent disclosure as clawbacks
! It is not deemed a waiver if ESI is inadvertently disclosed
! Intentional disclosure in a federal case or to a federal agency
waives the privilege, but is NOT a subject matter waiver
! If disclosure that’s meant to mislead is put forth in an unfair
manner, it will be considered a subject matter waiver
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33. Evidentiary Issues: You got it, now can you get it in?
! Is it relevant under Rule 401
! Is it authentic under Rule 901(a)
! Is it hearsay under Rule 801
! Except under Rules 803, 804 and 807)
! Is it an original or if a duplicate is there admissible secondary
evidence to prove the contents
! Does the probative value of the ESI substantially outweigh the
danger of prejudice or other factors of Rule 403.
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35. Failure factors, or Why there’s conflict among IT, HR, & legal
! Ignorance of e-discovery obligations
! No, responding to e-discovery is not optional…
! Yes, you have to preserve those e-mails…
! No, hiding evidence is not the way to win the case..
! Not enough time for people to do their jobs and deal with e-
discovery. Creates too much stress, and too many mistakes and
missed deadlines.
! Lack of strong leadership with the ability to motivate
compliance (or cause pain for noncompliance).
! Bad attitudes (that’s not my job or that’s my job not yours) & blame-
shifting—both related to all of the above
Left unmanaged or uncontrolled, there’ll be no end to conflict.
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36. Reducing the Failure Factors: Where to start
! Be prepared. Implement and enforce ESI retention policies.
Provide training to create awareness of e-discovery priorities.
! Use a project management approach
! Know who you’re going to call (the ghostbuster
approach). Create collaborative relationships with a vendor(s),
consultant(s), expert(s), etc. for the long-term.
! Read a good (best) e-discovery reference book
& refer to it often.
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37. Checklist of cost-related questions
! Are you asking the right questions?
! Are you getting answers to the questions you asked?
! What is the cost vs how to control costs?
! How do you preserve the memory about what worked
and what didn’t?
! What did you learn? How will you remember?
! Who’s going to help you when crisis hits?
! Are you prepared for the last minute disaster or
surprise change in scope?
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38. Questions & comments
! Ian J. Redpath, the expert lawyer
! Linda Volonino, the IT & computer forensics expert
! J. David Morris, EMC moderator
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