The December 2006 Amendments to the Federal Rules of Civil Procedure made a few changes to the process of e-discovery. A clear understanding of what the new rules entail and how they are applied is essential in litigation. The intended audience is anyone involved, or that may be involved, in requesting or responding to requests for “electronically stored information”.
Historically, discovery was a relatively straightforward process of gathering information from three sources: depositions, interrogatories, and the procurement of “documents and things.” In 1970 at the initial stages of the computer era, the phrase “data compilations” was added; however, this change did little to alter that approach, as the emphasis was still on the production of data in document form. Over the last 36 years, discovery has progressed to e-Discovery, with the term “Documents” taking on new meanings to include electronic data.
e-Discovery, also known as ediscovery, EDD, or electronic discovery, became the term for the process by which parties respond to requests to produce information that is maintained in electronic form. Until late 2006, the rules of e-discovery were effectively defined by the expanded designation of the term “Documents”, computer-savvy attorneys, and judicial interpretation of the original intent of discovery on a case-by-case basis.
On December 1, 2006, as a result of a five-year study, amendments to the Federal Rules of Civil Procedure went into effect. These amendments were designed to clearly address the issues related to the request for and production of “electronically stored information.” What follows is a brief summary of those changes.
The New Rules
According to the committee notes, “The wide variety of computer systems currently in use, and the rapidity of technological change, counsel against a limiting or precise definition of electronically stored information.” Therefore, the term “electronically stored information” was intentionally left open for interpretation to enable coverage of both current and future needs. “Electronically stored information” includes any type of information that is stored via electronics on any medium.
Rule 16(b), scheduling order, was modified to alert the court early in the litigation process of the needs and issues of e-Discovery, including inadvertent disclosure of privileged or trial-preparation information. A scheduling order will not be entered until the completion of the report required under Rule 26(f). The stated intention of this modification is to avoid “delay and excessive cost in discovery.”
Rule 26(a)(1)(B), required disclosures, was modified to parallel Rule 34(a), and includes the disclosure of electronically stored information in addition to documents and tangible things that the disclosing party may use to support its claims or defenses. The disclosing party must provide “a copy of, or a description by category and location.”
Rule 26(b)(2)(B), limitations, addresses the difficulties in locating, retrieving, and providing certain types or categories of electronically stored information. Under this rule, in addition to the standard claims of relevance and privilege, a responding party may now claim that the electronically stored information is “not reasonably accessible” due to undue burden or cost. The responding party will have to provide the appropriate details to allow the requesting party to evaluate these claims and to determine the likelihood of finding relevant evidence. On motion to compel discovery or for a protective order, the responding party must demonstrate undue burden or cost, and the requesting party will have an opportunity to show good cause regardless of burden or cost. This rule does not relieve any common duty of preservation.
Rule 26(b)(5)(B), inadvertent privilege production, has been added to provide a procedure to assert a claim of privilege or trial-preparation material after inadvertent production. The rule does not address whether the production constitutes a waiver of privilege or protection, leaving this determination to the court. Privilege issues are to be addressed, in advance, under Rule 26(f) below prior to production of discovery with a request, if agreed to, for the court to enter any agreement in a case management order under Rule 16(b).
Rule 26(f), planning conference, was modified to provide for a discussion of the issues related to electronic discovery, privilege assertion, and preservation. The outcome of this conference would be a report utilizing Form 35, discovery plan, which has been amended to address electronically stored information and privilege. This report and any unresolved issues would be discussed at the scheduling hearing under Rule 16. The following are examples of the types of issues and topics that should be discussed at this conference:
- Which information systems will potentially be involved in discovery
- Any anticipated claims of “not reasonably accessible”
- Information retention policies
- Security and Computer-Use policies
- The form, or forms, of production desired
- Should metadata be preserved and produced
- Discovery limiting features, such as, search terms and date ranges
- What would be considered reasonable preservation
- Issues relating to claims of privilege
Rule 33(d), option to produce business records, has been modified to specify that a party choosing to respond to an interrogatory by allowing access to responsive records may do so via access to electronically stored information. This rule specifies that the interrogating party must be able to locate and identify the information “as readily as can the party served”, and the responding party is required to allow a “reasonable opportunity to examine, audit, or inspect.” In some situations, this may require the responding party to provide some level of technical support or other assistance.
Rule 34(a), scope of production, has been amended to confirm that discovery of electronically stored information stands on equal footing with discovery of paper documents. As mentioned above, “electronically stored information” includes any type of information that is stored via electronics on any medium. According to committee notes, the term “documents” should be understood to include “electronically stored information” unless discovery has clearly documented a difference. Additionally, rules that have not been amended and contain the term “documents”, such as Rules 30(f), 36(a) and 37(c)(2), should still be interpreted to include electronically stored information. While not intending to create a routine right of direct access to a party’s information system, this amendment expressly permits the testing or sampling of materials requested in addition to inspecting and copying.
Rule 34(b), procedure for production, was amended to ensure electronically stored information, just as “document” production, is produced as kept in the normal course of business or organized into corresponding discovery request categories. The intent was to “protect against deliberate or inadvertent production in ways that raise unnecessary obstacles.” Rule 34(b) permits, but does not require, the requesting party to designate the form or forms of production. If the responding party objects to a form designated by the requesting party, or the requesting party does not specify a form, the responding party must state the form it intends to use in the written response to the production request. Responding to discovery requests for electronically stored information without first designating the form may cause duplicate efforts, and expense, on part of the responding party. Under Rule 34(a), a responding party may need to “translate” the information into a “reasonably usable” form. This does not mean one can freely convert electronically stored information into a form that removes or significantly degrades its usefulness.
Rule 37(f), failure to disclose electronically stored information, known as the “Safe Harbor” rule, was added to prevent sanctions, “absent exceptional circumstances” for electronically stored information lost “as a result of the routine, good-faith operation of an electronic information system.” “Good-faith” is the key term here and may require a party “to modify or suspend certain features of routine operation to prevent the loss of information” assuming there is a preservation obligation. The “good faith” provision prohibits a party from exploiting “the routine operation of an information system” to allow destruction of information in an effort to avoid discovery obligations. This rule does not affect the court’s ability to manage discovery through common remedies, it only restricts the imposition of sanctions “under these rules”.
Rule 45, subpoena, is modified to bring subpoenas in line with the changes to the other discovery rules with regards to electronically stored information. Some of the changes include:
- Electronically stored information can be sought by subpoena
- Subpoenas can designate form, or forms, of production
- The party served with a subpoena can object to the form, or forms, of production
- If no form is specified, production must be made in the form, or forms, ordinarily maintained or in a form, or forms, reasonably usable
- The responding party need not produce electronically stored information in more than one form
- The responding party may object as “not reasonably accessible”
- A subpoena can be issued to permit testing or sampling of electronic stored information
- Procedure for assertion of privilege
A Caution for Executives and Business Owners
Completely ignoring the “Safe Harbor” in Rule 37(f), many companies are producing interpretations of the new rules to use as scare tactics in order to increase software and hardware revenue. A simple Google search quickly provided two representative examples:
- “Is your organization prepared to meet new obligations for ediscovery …? Businesses today are incurring millions in fines … for their inability to respond—or to respond quickly enough—to litigation requests for electronic evidence.”, and
- “New rules for electronic discovery of documents … and they could costs users millions … if they fail to comply.”
While the use of computers in all facets of business has exploded in the past four decades, the rules governing discovery have not kept pace. The new rules are the first significant changes in the past 36 years to address the information age. Many of the opinion papers and articles already written are expressing confusion and concern, particularly with regards to Rule 26(b)(2)(B), “not reasonably accessible”, and Rule 37(f), “Safe Harbor”. The courts have already issued several rulings, based upon the application of the amendments, which have demonstrated these concerns to be unfounded. Those that attempt to use these rules to circumvent a party’s requirement to provide discovery will find it extremely difficult to pull the technical wool over the eyes of the court.
Better preparation on the front end of litigation by both plaintiff and defendant are now essential. Lacking the technical expertise in deciphering the multitude of systems and the many forms of data storage in use by individuals and businesses, the legal profession will turn to e-discovery firms for support. Extreme caution should be exercised when selecting a firm to provide technical Litigation Support; an incorrect choice could create debilitating costs or greatly impair the likelihood for success.