COMPLIANCEWhat Courts Expect In A Digital Age

September 11, 2013

Today’s Speakers

Joy Allen Woller, AttorneyLewis Roca Rothgerber LLPjwoller@lrrlaw.com303.628.9504

Chris Sullivan, Associate General Counsel CenturyLink Chris.Sullivan@CenturyLink.com303.992.5880

What is eDiscovery?

• “Discovery is expansive and includes any type of information that is stored electronically.”

“…discovery of electronically stored information stands on equal footing with discovery of paper documents…”

So much stuff…

• US Census Bureau Data - 3,789 terabytes• Library of Congress digital collection - 5,120 terabytes• Google’s Search Index - 97,656 terabytes• Content uploaded to Facebook each year - 182,500

terabytes• Business email sent per year - 2,986,100 terabytes

• Source: Wired Magazine, May 2013 “Big Data”

And it’s everywhere…

• “Discovery of ESI has become vital in most civil litigation – virtually all business information and much private information can be found only in ESI. At the same time, the costs of gathering, reviewing, and producing ESI have reached staggering proportions.”

• Hon. James C. Francis IV, Foreward, Judges’ Guide to Cost Effective E-Discovery, 2010

Yet Many Companies Lack An Information Retention Plan

• According to Symantec’s recent survey– Only 34% of responding organizations said they

have a formal information retention plan in place– 54% said preserving more ESI than necessary

increased their discovery costs– 27% said over preservation compromised their

position in potential or actual litigationSource: Symantec’s January 2013 Information Retention and eDiscovery Survey Global Results

ESI Volumes Are Often Huge Even For Companies With A Plan

In 2012, CenturyLink• Collected roughly 4.1 terabytes (TB) of ESI• 1 TB is equivalent to– 1,000 gigabytes– 7.5 million docs– 75 million pages

PLAN AHEAD, BE PROACTIVE, AND KNOW YOUR DATA

Courts will expect you to…

Understand What You Have

• Form a discovery team

• Create an internal discovery plan

Manage Data Collection

• Track and document your collection efforts– Standardize collection

processes and procedures– Update collections as

necessary– Do not rely on employees

to self collect

Bottom Line

• A well-executed discovery plan should help you demonstrate you’ve complied with your preservation obligations

• Reduces the chance a court will impose sanctions for inadvertent preservation failures

When you fail to plan…

• Swofford v. Eslinger (M.D. Fla. 2009)– Sanctioning in-house counsel for his “complete”

failure to preserve evidence, especially email and laptops, after receiving multiple preservation letters

• Bd. Of Regents of Univ. of Neb. v. BASF Corp. (D. Neb. November 2007)– sanctions for counsel’s failure to properly manage

the collection of materials, where they relied on the custodian to gather electronic documents

Follow the plan

• Apple v. Samsung Electronics (N.D. Cal. 2012)– Adverse inference instruction against Samsung for

failure to disable the auto-delete function of its email system after it anticipated litigation with Apple.

Know Your Data

• Cartel v. Asset Management– Motion for Protective Order denied– Producing party’s burden can’t be met will bald

generalizations – The equivalent of an unsubstantiated claim the sky was

falling.• 2010 U.S. Dist. LEXIS 178857 (D.Colo. 2010)(J. Shaffer)

Know your data – Cartel, cont.

• did not provide the Court with any information as to:– the types of databases;– storage systems and backup or archival systems that

[Defendants] use for [ESI]; and– policies regarding records management, including

the retention, destruction of ESI; or their ESI erasure, modification or recovery mechanisms.

• Asset Management citing Victor Stanley, 250 FRD 251, 261 (D.Md. 2008).

COMMUNICATE WITH THE OTHER SIDECourts will expect you to…

A failure to communicate…

• only 25% discussed electronic discovery issues at a Rule 26(f) meeting

• only 13% of all respondents discussed preservation obligations

• Emery G. Lee III, Report to the Judicial Conference Advisory Committee on Civil Rules, Federal Judicial Center, March 2012

Cooperate With The Other Side

• Cooperation - sharing information and collaboratively addressing eDiscovery issues – is increasingly required by the courts

• P.P.R. 6.1 – parties to confer on preservation• D.Colo. – Scheduling Order

Local efforts to address ESI

• 30 federal district courts address ESI– Identification of custodians (8 courts)– Search terms or search methodology (15 courts)– Retention, preservation, or spoliation (23 courts)– Cost and/or cost shifting (23 courts)

Why Cooperation Matters

• In eDiscovery disputes, courts are more likely to look favorably on litigants who attempted to cooperate

• Failure to cooperate in good faith in preparing a discovery plan is sanctionable in Fed. Ct.

BE KNOWLEGABLE ABOUT TECHNOLOGY

Courts are starting to expect you to …

The “technically competent” attorney?

• Rule 1.1 Competence• A lawyer should keep

abreast of changes in law and its practice, including the benefits and risks associated with relevant technology, …

Technology Assisted Review (TAR)

• Use of technology to cull very large sets of documents

• Now “approved” by a handful of courts

• Not a “Staples easy button” – Moore v. Publicis Groupe, 287 F.R.D. 182 (S.D.N.Y. 2012).

• Not appropriate for every case - EORHB, Inc. v. HOA Holdings LLC, 2013WL1960621 (Del. Ch. May 6, 2013).

But, proven to help in the right situation…

• “…by all measures, the average efficiency and effectiveness of the five technology-assisted reviews tested surpasses that of the five manual reviews.”

• “The technology-assisted reviews require, on average, human review of only 1.9% of the documents, a fifty-fold savings over exhaustive manual review.”

Source: Grossman, M., Technology Assisted Review In E-Discovery Can Be More Effective And More Efficient Than ExhaustiveManual Review, 17 Rich. J.L. & Tech. 11 Spring 2011, Table 7

PROPOSED AMENDMENTS TO THE FEDERAL RULES OF CIVIL PROCEDURE

Compliance in the future

An end to “anxiety and anguish”?

Background• The product of several mini-

conferences.• “…anxiety bordering on

anguish arises from uncertainty as to the beginning, scope, and duration of the duty to preserve and the concomitant risk of sanctions for spoliation.”

Timeline• August 15, 2013 - Published

for comment.• February 15, 2014 – Public

Comment Period Closes• December 1, 2015 – earliest

date proposed rules become effective

Reduced Scope of Discovery

(Proposed) Fed.R.Civ.P. 26(b)(1) Discovery Scope and Limits

• Discovery scope limited based on proportionality.• Omits the phrase “reasonably calculated to lead to

discovery of admissible evidence.”

The softer side of sanctions?

Curative measures; additional discovery

• “permit additional discovery, order curative measures, or order the party to pay reasonable expenses, including attorney’s fees”

Sanctions• Substantial prejudice was

caused and were willful or in bad faith

• Irreparably deprived a party of meaningful opportunity to present or defend claims

The softer side of sanctions?

• Factors to be considered in assessing a party’s conduct– Extent party was on notice that litigation was likely;– Reasonableness of efforts to preserve;– Whether request to preserve was received;– Proportionality of preservation efforts;– Whether court guidance was timely sought.

QUESTIONS?

Where to go for help on ESI:

• The Sedona Conference® (various free guides and publications on eDiscovery) http://www.thesedonaconference.org/ http://www.edrm.net/

• Federal Judicial Center (various “Materials on Electronic Discovery: Civil Litigation”) http://www.fjc.gov/

• Text of Proposed Federal Rules Changes: http://www.uscourts.gov/uscourts/rules/preliminary-draft-proposed-amendments.pdf

• Seventh Circuit Pilot Project: http://www.discoverypilot.com/• eLaw Exchange: http://www.elawexchange.com/