By Daniel K. Gelb and Richard M. Gelb
The Daily Record Newswire
Electronically stored information is the mine where golden nuggets of information reside. However, it is incumbent upon counsel to find the veins of ore, rather than spending time breaking rocks. Otherwise, the costs of discovery will prevent parties from access to a fair adjudication of their disputes.
The discovery of electronically stored information (“ESI”) has become a specific practice area for attorneys and digital forensics consultants alike. The federal courts in civil litigation apply the Federal Rules of Civil Procedure (“FRCP”) found at www.uscourts.gov/rules/CV2009.pdf. Since Dec. 1, 2006, certain rules codified in the FRCP have begun to target the handling of ESI during pretrial discovery.
Alternatively, at the state level, courts have non-binding guidelines available to them promulgated by the National Center for State Court’s Conference of Chief Justices entitled “Guidelines for State Trial Courts Regarding Discovery of Electronically Stored Information” found at www.ncsconline.org/images/EDiscCCJGuidelinesFinal.pdf. Some jurisdictions have codified rules of court governing the handling of ESI during the discovery process; however, Massachusetts is not one of them.
At both the state and federal levels, spoliation of ESI can have draconian results if a party is sanctioned. In federal criminal litigation, there is not a corollary to the FRCP relating to ESI. Notwithstanding this fact, spoliation of ESI can also result in dire consequences, including an obstruction of justice charge for a criminal target or dismissal of an indictment for the government. Therefore, the e-discovery is a central concern during civil litigation, criminal prosecutions, internal investigations, regulatory proceedings, and arbitration.
Not just e-mail
Notably, ESI is not confined to e-mails. ESI includes all information created, stored or accessed by computer technology of any type. Use of electronic facsimile transmissions, PDAs like the iPhone and Blackberry, voicemails stored in wave or mp3 files, instant messages, GPS devices, and website content are just a handful of examples where ESI may be located.
In addition, ESI includes information about the ESI sought such as metadata (e.g., data about data), as well as information residing in locations that are not readily accessible and require commercial digital forensics services to recover latent, dormant or ephemeral data. As technology develops and communications through electronic mediums become more unified through development like voice-to-text and audio attachments, e-discovery as a discipline will only continue to proliferate at rocket speed.
New technology, same approach
The best way to approach e-discovery is to visualize proceeding as one would with hard-copy documents. The same rules apply to ESI. The difference is that ESI is in a dynamic form — for example, metadata changes when a document is opened — and is more prolific. E-discovery should also be viewed through its components: preservation, production and retrieval. Finally, e-discovery should be conducted in the context of the case strategy.
Preserving ESI is the least costly aspect of e-discovery. For example, engaging a computer forensics vendor to “mirror” (i.e. copy) and escrow a hard drive on a laptop computer should be done routinely. Of course, issues arise for large companies that have complex computer systems and procedures such as backing up computers with tapes. Such companies can proactively control costs by implementing document retention policies, protocols for storing ESI and employee policies, like stating in an employee handbook that there is no expectation of privacy as to a company-owned computer.
The obligation to preserve ESI is triggered when litigation is “reasonably anticipated.” However, a company is not a guarantor of the preservation of ESI and must weigh the costs of preserving ESI (i.e. suspending normal procedures for ESI destruction) against the risks of not preserving ESI (i.e. court sanctions). Outside counsel, in conjunction with a computer forensics expert, can assist the company by addressing the legal issues and implementing and documenting the strategy so that a vigorous argument can be made that the company took reasonable steps to preserve the ESI.
Formulate a strategy
Once the ESI is preserved, counsel should formulate a strategy with the client as to the initial use of the ESI. For example, counsel may ask the client (who is almost assuredly the most familiar with the subject matter and location of ESI) to quickly obtain some e-mails to attach to an affidavit in support of a motion for a temporary restraining order in a noncompetition case.
The approach would be different when responding to a subpoena from the Department of Justice where obstruction of justice is a concern. An adversary must justify its request for ESI in the same manner as it would with respect to hard-copy documents. The request must be relevant and reasonably calculated to lead to the discovery of admissible evidence. Therefore, a request for all e-mails for the period from x to y without regard to the subject matter would be overly broad. Moreover, a request for all metadata (thereby necessitating an extensive privilege review) may be overly broad and burdensome. For example, the metadata for an Excel spreadsheet in a securities fraud case may be relevant. The metadata for a contract — the terms of which are not in dispute — would not be relevant.
Therefore, what is to be preserved and produced may be the subject of negotiation. If the parties cannot resolve their disputes, they may ask for relief from the court.
Counsel — along with the client and any necessary experts and vendors — should also formulate a protocol for the production. Who will review the ESI? For example, trial counsel may wish to personally review e-mails sent and received by the key custodians (i.e. company employees). Will contract attorneys do a privilege review, and, if so, what procedures will be put in place to avoid inadvertent production? Will a vendor “dedupe” (i.e. weed out duplicate copies) prior to review? In what form will the documents be produced? Where will the internal copy be hosted?
Retrieval
The preservation and production of ESI is an episodic event at the commencement of litigation. Retrieval of ESI for strategic purposes is ongoing through discovery and trial.
Going back to the mining analogy above, how do you find the golden nuggets?
First, counsel must be experienced in the courtroom so that issues to be advocated at trial are properly framed at the start and refined during the course of the case. If one were to climb Mount Everest, it would be more prudent to use a guide who has reached the summit rather than one who spent his time at base camp.
Second, work with vendors who are creative and efficient. The trial team will likely use 2 to 5 percent of all of the ESI for purposes of depositions and trial. Look at the trial team as the gourmet chiefs who want to spend their time in the kitchen making the meal. The vendors are like the sous chefs who go to the market to find the best ingredients. A responsible vendor will educate the client and counsel how to best retrieve documents (e.g. that e-mails have embedded in them associated ESI so that they can be retrieved by sender and recipient without the need to code them).
Third, make experts part of the team. Ninety percent of cases are settled, and a consulting expert can be more effectively used than a testifying expert since communications with a consulting expert are protected by the attorney-client privilege and work product doctrine.
Multitask rather than approaching the case in a linear matter (i.e. liability and then damages). For example, emails may be retrieved through a key word search. If words are added after the search, the cost is duplicative rather than incremental. Therefore, use a damages consulting expert to supply key words to the e-discovery vendor at the same time liability discovery is taking place.
Fourth, the client should be a good consumer. The client — with trial counsel — should interview vendors who have the expertise and tools specific to the tasks to be undertaken. Is the vendor’s product user friendly and well supported? If the documents are to be hosted on the Internet, is the vendor’s platform secure (e.g. certified by the Department of Defense and backed up at offsite locations)? Does the computer forensics expert have the appropriate qualifications for the engagement (e.g. a law enforcement background, an advanced degree in computer science)?
Clients should not be reticent in exploring with counsel the economic arrangements for the services to be utilized. Does counsel have an economic arrangement with the vendor (e.g. an override on services)? Is counsel objective in selecting the vendor (e.g. is there a case referral arrangement between the law firm and vendor)? What due diligence was performed with respect to experts and vendors (e.g. does the law firm use a facilities management approach by hiring a company that provides one stop shopping or are vendors individually selected on the basis of their credentials, knowledge, experience, reputation, and prior experiences with the client and/or counsel)? Will counsel be amenable to having the vendors (e.g. contract attorneys) bill on a direct basis rather than through the law firm with on fee added on?
Finally, the best way to control the course and costs of litigation (as well as any other proceedings) is to have a close partnering relationship with counsel. Collaboration on case and discovery plans and project budgets is critical. Ongoing communication regarding case strategy including settlement opportunities allows the client and counsel to maintain a meeting of the minds and avoid the element of surprise.
As with any subject matter, knowledge is power. At a minimum, clients should become familiar with the issues relating to e-discovery and be aggressive in probing their counsel so that they understand and are comfortable with how their case is being handled. Litigants who must deal with large volumes of ESI cannot create a perfect world; however, they should be proactive in creating one that is most beneficial and practical for the client.
Daniel Gelb and Richard Gelb practice at Gelb & Gelb in Boston.
