How To Handle Electronic Discovery In Aransas

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1 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 I. INTRODUCTION Advancing computer technology and efforts to reduce the amount of paper in the workplace are creating a world in which records and information are increasingly kept in electronic form in addition to or in lieu of paper form. All attorneys should take note of the fact that electronic document retention and electronic discovery are very important and quickly evolving fields for both you and your clients. In August of 2004, the Civil Discovery Standards promulgated by the American Bar Association were amended to reflect the recent rise of duties and obligations ascribed to parties to litigation and their attorneys with regard to electronic discovery. For similar reasons and in similar ways, Federal Rules 16, 26, 33, 34, 37, and 45 of the Federal Rules of Civil Procedure were amended in These amendments reflect the fact that courts across the nation have begun holding parties responsible for the preservation and production of an increasingly large body of information stored in electronic form. In recent years, courts have been forced to address discovery disputes arising in the context of electronic discovery, and in some cases courts have held parties and sometimes attorneys responsible for failure to preserve evidence and for other misconduct with regard to electronic data. The following memorandum is an electronic discovery and document retention guideline for government attorneys and administrators in the State of Arkansas. Section II of this memo provides a brief summary of a series of federal cases which have brought electronic discovery to the forefront of American jurisprudence. In Section III, various sources of guiding standards and rules are analyzed, including the American Bar Association Civil Discovery Standards, the Federal Rules of Civil Procedure and the 2006 Amendments, Arkansas procedural and common law, and the Sedona Principles. The analysis is designed to inform the reader about the typical issues that arise in electronic discovery and the general types of duties and obligations which are ascribed to parties to litigation and their attorneys. This portion of the memo is not meant to be an exhaustive analysis of the law (many of these sources are not binding), and specific issues which arise in the context of any individual case should be researched further with these general guidelines in mind. Section IV of the memo is a discussion of basic practice tips which should be considered when a lawsuit is filed against your client, during the initial discovery conference, when requesting electronic discovery from the opponent, and when responding to requests for electronic discovery from the opponent. II. ZUBULAKE The seminal case discussing counsel s obligation to ensure that relevant information is preserved by giving clear instructions to the client to preserve such information, and discussing a client s obligation to heed those instructions, both in the context of electronic data, is a series of cases entitled Zubulake v. UBS Warburg LLC. 1 1 See 217 F.R.D. 309 (S.D.N.Y. 2003) ( Zubulake I ); 216 F.R.D 280 (S.D.N.Y. 2003) ( Zubulake III ); 220 F.R.D. 212 (S.D.N.Y. 2003) ( Zubulake IV ); 229 F.R.D. 422 (S.D.N.Y. 2004) ( Zubulake V ). 1

2 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 Zubulake was an employment dispute involving claims of gender discrimination and retaliation. The plaintiff retained documents from her prior employment with the defendant, including 450 pages of evidence that were missing from the defendant s production of computer files. 217 F.R.D. at 313, 317. These pages in the plaintiff s possession served as the catalyst for discovery of deleted s still residing on backup tapes from the defendant s computer network. The plaintiff moved to compel such discovery, and the defendant responded by objecting and requesting that the court shift the cost to the plaintiff under Fed. R. Civ. P. 26(b)(2). 217 F.R.D. at 317. In response to the electronic discovery dispute, the court devised a seven-factor test to evaluate electronic discovery and determine whether to shift the cost of such discovery: (1) the extent to which the request is specifically tailored to discover relevant information; (2) the availability of such information from other sources; (3) the total cost of production, compared to the total amount in controversy; (4) the total cost of production, compared to the resources available to each party; (5) the relative ability of each party to control costs and its incentive to do so; (6) the importance of the issues at stake in the litigation; and (7) the relative benefits to the parties of obtaining the information. 217 F.R.D. at The court did not give these factors equal weight: factors (1) and (2) were considered the most important, (3) through (5) were less important, and (6) and (7) were described as rarely coming into play. 217 F.R.D. at 323. Zubulake is also noteworthy for three general statements of law regarding electronic discovery and the costs involved. First, discovery does not automatically become burdensome merely because electronic evidence is involved. 217 F.R.D. at 318. Second, it is not appropriate to shift the cost of electronic discovery where information is sought from accessible, active or near online data. 216 F.R.D. at 284 (citing to earlier opinion at 217 F.R.D. at 324). Third, where off-line, inaccessible electronic data is sought (and hence cost shifting becomes a possibility), only the cost of restoring and searching the inaccessible data should be shifted to the requesting party. The responding party should always bear the cost of reviewing and producing electronic data after it has been restored. 216 F.R.D. at 290. There are now many state and federal cases discussing electronic discovery, but Zubulake is considered to be the original guiding authority for detailed discussion of electronic discovery issues in the common law. 2 These factors are closely mirrored by the Advisory Committee Comments to the 2006 Amendments to Federal Rule 26(b)(2), infra. 2

3 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 III. LAW AND ANALYSIS A. Federal Rules of Civil Procedure: Electronic Discovery Provisions On April 12, 2006, several of the Federal Rules of Civil Procedure were amended to incorporate provisions explicitly addressing electronic discovery issues. The amendments became effective on December 1, 2006, following several years of comments and modifications. With respect to electronic data, the amendments are contained in Federal Rules 16, 26, 33, 34, 37, and 45. Federal Rule 16 has been amended to effectively require parties to talk about electronic discovery at their initial Rule 16 conference. Rule 16(b) has been amended to allow parties to ask the court to include in a scheduling order any agreements the parties reach regarding issues of privilege or discovery production. Fed. R. Civ. P. 16(b)(6). The amended Rule 16 also allows such scheduling orders to include provisions for disclosure or discovery of electronically stored information. Rule 16(b)(5). The amendment to Rule 16(b) is designed to alert the court to the possible need to address the handling of discovery of electronically stored information early in the litigation if such discovery is expected to occur. Advisory Committee Notes to the 2006 Amendments to Rule 16. Rule 26(f) has also been amended to direct parties to discuss privilege at their initial discovery conference, infra. The most significant amendments are to Rule 26, governing discovery. Among the changes include the facts that parties must now provide electronically stored information as a part of their initial disclosures, Fed. R. Civ. P. 26(a)(1)(B), parties must discuss electronic discovery in their Rule 26(f) conference, and parties must document any issues relating to disclosure or discovery of electronically stored information, including the form or forms in which it should be produced, in their Rule 26(f) report. Fed. R. Civ. P. 26(f)(3). The Advisory Committee Comments to the 2006 Amendments to Rule 26(f) note various issues, including the fact that individual cases will vary based upon the information systems involved and the parties and attorneys knowledge of those systems 3, the fact that parties must discuss preservation of discoverable information, which can be particularly difficult with electronic data, 4 and 3 When a case involves discovery of electronically stored information, the issues to be addressed during the Rule 26(f) conference depend on the nature and extent of the contemplated discovery and of the parties information systems. It may be important for the parties to discuss those systems, and accordingly important for counsel to become familiar with those systems before the conference. With that information, the parties can develop a discovery plan that takes into account the capabilities of their computer systems. In appropriate cases identification of, and early discovery from, individuals with special knowledge of a party s computer systems might be helpful. Id. 4 Rule 26(f) is also amended to direct the parties to discuss any issues regarding preservation of discoverable information during their conference as they develop a discovery plan. This provision applies to all sorts of discoverable information, but can be particularly important with regard to electronically stored information. The volume and 3

4 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 the fact that parties must now discuss issues of privilege in the initial discovery conference, which can be complicated when dealing with electronic information. 5 There is a new paragraph in the portion of Rule 26 discussing limitations on discovery, specifically applicable to electronic discovery in light of the other amendments to Rule 26: A party need not provide discovery of electronically stored information from sources that the party identifies as not reasonably accessible because of undue burden or cost. On motion to compel discovery or for a protective order, the party from whom discovery is sought must show that the information is not reasonably accessible because of undue burden or cost. If that showing is made, the court may nonetheless order discovery from such sources if the requesting party shows good cause, considering the limitations of Rule 26(b)(2)(C). The court may specify conditions for the discovery. Fed. R. Civ. P. 26(b)(2)(B). dynamic nature of electronically stored information may complicate preservation obligations. The ordinary operation of computers involves both the automatic creation and the automatic deletion or overwriting of certain information. Failure to address preservation issues early in the litigation increases uncertainty and raises a risk of disputes. Id. 5 Rule 26(f) is also amended to provide that the parties should discuss any issues relating to assertions of privilege or of protection as trial preparation materials, including whether the parties can facilitate discovery by agreeing on procedures for asserting claims of privilege or protection after production and whether to ask the court to enter an order that includes any agreement the parties reach.... [P]roblems often become more acute when discovery of electronically stored information is sought. The volume of such data, and the informality that attends use of and some other types of electronically stored information, may make privilege determinations more difficult, and privilege review correspondingly more expensive and time consuming. Other aspects of electronically stored information pose particular difficulties for privilege review. For example, production may be sought of information automatically included in electronic files but not apparent to the creator or to readers. Computer programs may retain draft language, editorial comments, and other deleted matter (sometimes referred to as embedded data or embedded edits ) in an electronic file but not make them apparent to the reader. Information describing the history, tracking, or management of an electronic file (sometimes called metadata ) is usually not apparent to the reader viewing a hard copy or a screen image. Whether this information should be produced may be among the topics discussed in the Rule 26(f) conference. Id. 4

5 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 Thus, Rule 26 as amended recognizes that the burden of electronic discovery can be very great in some cases, but when a dispute arises, the burden is always on the party from whom discovery is sought to demonstrate that the information is not reasonably accessible due to burden or cost, and the court maintains the discretion to compel the discovery and/or shift the cost of discovery. Rule 26(b)(2) as amended is designed to address issues raised by difficulties in locating, retrieving, and providing discovery of some electronically stored information. Advisory Committee Comments, 2006 Amendments, Subdivision (b)(2). The responding party has the burden of showing that identified sources of electronically stored information are not reasonably accessible in light of the burdens and costs required to search for, retrieve, and produce whatever responsive information may be found. Thus, the responding party may identify, but not initially produce, what is defined as inaccessible electronic data. Where this showing is made, the burden then shifts to the requesting party to show that its need for the discovery outweighs the burdens and costs of locating, retrieving, and producing the information. Appropriate considerations for the court may include: (1) the specificity of the discovery request; (2) the quantity of information available from other and more easily accessed sources; (3) the failure to produce relevant information that seems likely to have existed but is no longer available on more easily accessible sources; (4) the likelihood of finding relevant, responsive information that cannot be obtained from other, more easily accessed sources; (5) predictions as to the importance and usefulness of the further information; (6) the importance of the issues at stake in the litigation; and (7) the parties resources. Id. Some instances in which records may not be reasonably accessible include restoring backup tapes or recreating deleted data. Rule 26 has also been amended to loosen the rules on inadvertent production of privileged information, to accommodate electronic discovery. Federal Rule 26(b)(5)(B), as amended, allows a party to produce documents to the other side without waiving the attorney-client privilege or work-product protection (the clawback provision). This provision has been added because the cost of reviewing large quantities of electronic documents for privilege and relevancy can sometimes exceed the amount at stake in litigation. Attorneys and parties should be cautious when relying on this new clawback provision, because there are potential pitfalls inherent in the Rule. See Oops! That Wasn t Meant for You, Daniel E. Rohner, e- Discovery, a Special Publication of the American Bar Association Section of Litigation, at (Noting that the standards for privilege waiver vary from jurisdiction to jurisdiction, that clawback agreements only bind parties to the contract and do not bind nonparties, and that the clawback provision in Federal Rule 26 could be affected by proposed changes to the Federal Rules of Evidence on attorney-client privilege.). Prior to amendment, Rule 26 provided that when a party withholds information on the basis of privilege or other protection: the party shall make the claim expressly and shall describe the nature of the documents, communications, or things not produced or disclosed in a manner that, without revealing information itself privileged or protected 5

6 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 will enable other parties to assess the applicability of the privilege or protection. Prior Rule 26(b)(5). This language is preserved in identical form in the amended rule at Rule 26(b)(5)(A). Additionally, the amended rule contains the following new provision regarding privilege: Information Produced. If information is produced in discovery that is subject to a claim or privilege or of protection as trial-preparation material, 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. If the receiving party disclosed the information before being notified, it must take reasonable steps to retrieve it. The producing party must preserve the information until the claim is resolved. Fed. R. Civ. P. 26(b)(5)(B). The Advisory Committee Notes to the 2006 Amendments to Rule 26 make it clear that this new provision was inserted due to the heightened risk of unintentional disclosure of privileged or protected information during electronic discovery: The Committee has repeatedly been advised that the risk of privilege waiver, and the work necessary to avoid it, add to the costs and delay of discovery. When the review is of electronically stored information, the risk of waiver, and the time and effort required to avoid it, can increase substantially because of the volume of electronically stored information and the difficulty in ensuring that all information to be produced has in fact been reviewed. Id. Note that this provision does not necessarily mean that privilege is not waived by production in any given case: Rule 26(b)(5)(B) does not address whether the privilege or protection that is asserted after production was waived by the production. The courts have developed principles to determine whether, and under what circumstances, waiver results from inadvertent production of privileged or protected information. Rule 26(b)(5)(B) provides a procedure for presenting and addressing these issues. Id. 6

7 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 The changes to Rule 26 parallel a similar amendment to Rule 34(a), which now allows for the discovery of electronically stored information in addition to the traditional discovery of documents and things. Fed. R. Civ. P. 34(a). The comments to the 2006 Amendments to Rule 34 provide that Rule 34(a) is amended to confirm that discovery of electronically stored information stands on equal footing with discovery of paper documents. Id. Rule 34 as amended also establishes that where a request fails to specify the form for producing electronically stored information, a responding party must produce the information in a form or forms in which it is ordinarily maintained or in a form or forms that are reasonably usable. Rule 34(b)(ii). Rule 34(b) as amended generally addresses the procedures for electronic discovery. Notably, Federal Rule 33 has also been amended to clarify that a party may answer an interrogatory by referring to specific electronically stored information. Most of the reported hype about electronic discovery in recent years has related to sanctions imposed on parties for failing to produce electronic data or for the deletion of electronic data prior to production. It must be noted that [a] party s identification of sources of electronically stored information as not reasonably accessible does not relieve the party of its common-law or statutory duties to preserve evidence. Advisory Committee Notes to 2006 Amendments to Federal Rule 26(b)(2). This is especially important to note in light of the fact that sanctions under Rule 37 apply in the context of electronic discovery just as in the context of ordinary documents and things. However, with regard to routine alteration and deletion of information that attends ordinary use of computers, the 2006 Amendments provide the following new provision to Rule 37 (the safe harbor provision): (f) Electronically Stored Information. Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system. Fed. R. Civ. P. 37(f). The safe harbor provision is virtually guaranteed to give rise to disputes as parties and courts struggle to define exceptional circumstances and goodfaith in this context. The Advisory Committee Notes to the 2006 Amendment to Rule 37(f) state that: Rule 37(f) applies only to information lost due to the routine operation of an electronic information system the ways in which such systems are generally designed, programmed, and implemented to meet the party s technical and business needs. The routine operation of computer systems includes the alteration and overwriting of information, often without the operator s specific direction or awareness, a feature with no direct counterpart in hard-copy documents. Such features are essential to the operation of electronic information systems.... 7

8 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 A preservation obligation may arise from many sources, including common law, statutes, regulations, or a court order in the case. The good faith requirement of Rule 37(f) means that a party is not permitted to exploit the routine operation of an information system to thwart discovery obligations by allowing that operation to continue in order to destroy specific stored information that it is required to preserve. When a party is under a duty to preserve information because of pending or reasonably anticipated litigation, intervention in the routine operation of an information system is one aspect of what is often called a litigation hold. Id. Thus, it is clear that Rule 37(f) does not abrogate any preservation or production duties arising elsewhere in the rules, statutes, or common law. Rule 37(f) also does not appear to permit routine intentional deletion of files. Finally, Federal Rule 45 (regarding subpoenas) has been amended to incorporate the changes to Rules 26 and 34. The amendment provides that a subpoena may specify the form or forms in which electronically stored information is to be produced. Fed. R. Civ. P. 45(a). The amendment also allows the producing party to object to the specified form of production, similar to amended Rule 34(b), and contains other provisions mirroring Rule 34(b). See Fed. R. Civ. P. 45(c)(2)(B). B. American Bar Association Civil Discovery Standards In 1999, the American Bar Association adopted its Civil Discovery Standards to assist parties, counsel, and courts in civil discovery. The Standards include provisions addressing preservation duties and cost-shifting in relation to electronic discovery. These Standards (and the 2004 Amendments related to electronic discovery) are designed to supplement existing rules and address practical aspects of the discovery process that are not addressed by the rules. See Report: 2004 Amendments to the Civil Discovery Standards Relating to Electronic Discovery, Patricia Lee Refo, Chair, American Bar Association Section of Litigation. The 2004 Amendments to the Civil Discovery Standards Relating to Electronic Discovery provide a detailed overview of issues which might arise in electronic discovery. Though these amendments and the Standards are not binding on parties to lawsuits, they laid the groundwork for the later amendments to the Federal Rules of Civil Procedure, supra, and they serve as a useful practice guide for litigation attorneys confronted with electronic discovery issues. The Amendments are addressed briefly below, in the order that they appear in the Civil Discovery Standards, as amended. The attorney s duty to inform the client of its duty to preserve documents arises when the attorney learns that litigation is probable or has commenced, and any potentially relevant documents in the client s custody or control should be preserved at this point. ABA 2004 Amendments to Civil Discovery Standards, IV(10). The duty to produce may be, but is not necessarily, coextensive with the duty to preserve. Id. Counsel, parties, and the courts are advised to consider the following types of electronic data: (including attachments); word processing documents; 8

9 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 spreadsheets; presentation documents; graphics; animations; images; audio, visual, and audiovisual recordings; and voic . The following platforms should also be considered: databases; networks; computer systems, including hardware and software; servers; archives; backup or disaster recovery systems; tapes, discs, drives, cartridges and other storage media; laptops; personal computers; internet data; personal digital assistants; handheld wireless devices; mobile telephones; paging devices; and audio systems, including voic . Id. at VIII(29)(a). The Amendments specify that document requests should state whether electronic data is sought or not, and if electronic data is sought, requests should state what format the party requests for production of such data. In addition, there are sixteen factors listed which should be considered for motions to compel or motions for protective orders regarding electronic data. Id. at VIII(29)(b). The Amendments demonstrate a preference for discovery in electronic format where possible, even if the relevant information is not previously in electronic format. Parties are encouraged to produce discovery materials in electronic form even where they have not been previously stored electronically (Id. at VIII(30)(a)), and parties are encouraged to serve discovery requests and responses in electronic form. Id. at VIII(30)(b). Parties are also encouraged to confer about any electronic discovery that they anticipate requesting from one another at the initial discovery conference. Id. at VIII(31) 6. To ameliorate attorney-client privilege and work product concerns which arise during the production of electronic data, the parties are encouraged to consider stipulating to the entry of a court order appointing a mutually-agreed, independent information 6 Specifically, with regard to electronic discovery, parties are encouraged to confer about (i) the subject matter of such discovery; (ii) the time period with respect to which such discovery may be sought; (iii) the party-affiliated persons, entities or groups from whom such discovery may be sought; (iv) those persons currently or formerly affiliated with the prospective responding party who are knowledgeable of the information systems, technology and software necessary to access potentially responsive data; (v) the potentially responsive data that exist; (vi) the accessibility of the potentially responsive data; (vii) whether potentially responsive data exists in searchable form; (viii) whether potentially responsive data will be requested or produced in electronic form or in hard copy and if in electronic form, the format for production; (ix) data retention policies applicable to potentially responsive data; (x) preservation of potentially responsive data, including data generated subsequent to the filing of the claim, data otherwise customarily subject to destruction, and metadata; (xi) the use of key terms or other selection criteria to search potentially responsive data for discoverable information; (xii) the identity of unaffiliated information technology consultants whom the litigants agree are capable of extracting and searching data; (xiii) stipulating to the entry of a court order providing that production to other parties of privileged or work-product protected electronic data will not effect a waiver of privilege or work-product protection; (xiv) the appropriateness of an inspection of computer systems, software or data to facilitate or focus the discovery of electronic data; and (xv) the allocation of costs. 9

10 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 technology consultant as an agent of the court so that the consultant s assistance will not effect a waiver of privilege or any legal protection attaching to any data. Id. at VIII(32) 7. The American Bar Association s Civil Discovery Standards as amended in 2004 can be accessed online at the following website: C. Arkansas Law Arkansas Rule 26 provides for discovery of any matter, not privileged, which is relevant to the issues in the pending actions... including... any books, documents, or other tangible things. Ark. R. Civ. P. 26(b)(1). On September 24, 2009, the Arkansas Supreme Court issued the per curiam opinion In Re: Electronic Discovery and Adoption of Rule of Civil Procedure 26.1, 2009 Ark Effective October 1, 2009, Ark. R. Civ. P now provides as follows: (a) Definitions. In this rule: (1) Discovery means the process of providing information in a civil proceeding in the courts of this state pursuant to the Arkansas Rules of Civil Procedure or these rules. (2) Electronic means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities. (3) Electronically stored information means information that is stored in an electronic medium and is retrievable in perceivable form. (4) Person means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity. (b) Supplemental and optional rule. This rule is intended to supplement the Arkansas Rules of Civil Procedure, and the Arkansas Rules of Civil Procedure shall govern if there is a conflict between this supplemental rule and the Rules of Civil Procedure. The rule is optional because either the 7 This section of the Civil Discovery Standards also provides detailed guidelines for setting forth a procedure for the consultant s work and review of extracted data by the parties. The Standards should be consulted if you have a case where you are considering a mutually-agreed consultant for assistance with electronic data production. 10

11 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 parties must agree that it will apply, or the circuit court must order that it will apply on motion for good cause shown. (c) Conference, plan, and report. (1) In any proceeding in circuit court, the parties may agree to pursue electronic discovery pursuant to this rule or the court may so order on motion for good cause shown. Any such agreement or motion shall be made within 120 days after the date that the complaint was filed. The court, however, may extend or reopen this period for good cause. Within 30 days of an agreement or order to proceed under this rule, the parties shall confer. At this conference, the parties shall discuss and plan for the following issues: (A) any issues relating to preservation of discoverable information; (B) the form in which each type of the information will be produced; (C) the period within which the information will be produced; (D) the method for asserting or preserving claims of privilege or of protection of the information such as trial-preparation materials, including the manner in which such claims may be asserted after production; (E) the method for asserting or preserving confidentiality and proprietary status of information relating to a party or a person not a party to the proceeding; (F) whether allocation among the parties of the expense of production is appropriate; and, (G) any other issue relating to the discovery of electronically stored information. (2) Following the planning conference, the parties shall: (A) develop a proposed plan relating to discovery of the information; and (B) not later than 14 days after the conference under subdivision (c)(1), submit to the court a written report that summarizes the plan and states the position of each party as to any issue about which they are unable to agree. (d) Order governing discovery. (1) In a civil proceeding, the court may issue an order governing the discovery of electronically stored information pursuant to: 11

12 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 (A) a motion by a party seeking discovery of the information or by a party or person from which discovery of the information is sought; (B) a stipulation of the parties and of any person not a party from which discovery of the information is sought, or (C) the court s own motion, after reasonable notice to, and an opportunity to be heard from, the parties and any person not a party from which discovery of the information is sought. (2) An order governing discovery of electronically stored information may address: (A) whether discovery of information is reasonably likely to be sought in the proceedings; (B) preservation of the information; (C) the form in which each type of the information is to be produced; (D) the time within which the information is to be produced; (E) the permissible scope of discovery of the information; (F) the method for asserting or preserving claims of privilege or of protection of the information as trial-preparation material after production; (G) the method for asserting or preserving confidentiality and the proprietary status of information relating to a party or a person not a party to the proceeding; (H) allocation of the expense of production; and (I) any other issue relating to the discovery of the information. (e) Limitation on sanctions. Absent exceptional circumstances, the court may not impose sanctions on a party under these rules for failure to provide electronically stored information lost as the result of the routine, good-faith operation of an electronic information system. (f) Request for production. (1) In a civil proceeding, a party may serve on any other party a request for production of electronically stored information and for permission to inspect, copy, test or sample the information. 12

13 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 (2) A party on which a request to produce electronically stored information has been served shall, in a timely manner, serve a response on the requesting party. The response must state, with respect to each item or category in the request: (A) that inspection, copying, testing, or sampling of the information will be permitted as requested; or (B) any objection to the request and the reasons for the objection. (g) Form of production. Unless the parties otherwise agree or the court otherwise orders: (1) the responding party shall produce the information in a form in which it is ordinarily maintained or in a form that is reasonably useful; (2) if necessary, the responding party shall also produce any specialized software, material, or information not ordinarily available so that the requesting party can access and use the information in its ordinarily maintained form; and (3) a party need not produce the same electronically stored information in more than one form. (h) Limitations on discovery. (1) A party may object to discovery of electronically stored information from sources that the party identifies as not reasonably accessible because of undue burden or expense. In its objection the party shall identify the reason for such undue burden or expense. (2) On motion to compel discovery or for a protective order relating to the discovery of electronically stored information, a party objecting bears the burden of showing that the information is from a source that is not reasonably accessible because of undue burden or expense. (3) The court may order discovery of electronically stored information that is from a source that is not reasonably accessible because of undue burden or expense if the party requesting discovery shows that the likely benefit of the proposed discovery outweighs the likely burden or expense, taking into account the amount in controversy, the resources of the parties, the importance of the issues, and the importance of the requested discovery in resolving the issues. 13

14 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 (4) If the court orders discovery of electronically stored information under subdivision (h)(3) it may set conditions for discovery of the information, including allocation of the expense of discovery. (5) The court shall limit the frequency or extent of discovery of electronically stored information, even from a source that is reasonably accessible, if the court determines that: (A) it is possible to obtain the information from some other source that is more convenient, less burdensome, or less expensive; (B) the discovery sought is unreasonably cumulative or duplicative; (C) the party seeking discovery has had ample opportunity by discovery in the proceeding to obtain the information sought; or (D) the likely burden or expense of the proposed discovery outweighs the likely benefit, taking into account the amount in controversy, the resources of the parties, the importance of the issues, and the importance of the requested discovery in resolving the issues. (i) Claim of privilege or protection after production. A claim of privilege or protection after production of electronic data under these supplemental rules shall be governed by Rule of Civil Procedure (26)(b)(5) unless the application of that rule is modified by agreement of the parties or by order of the court. (j) Subpoena for production. (1) A subpoena in a civil proceeding may require that electronically stored information be produced and that the party serving the subpoena or person acting on the party s request be permitted to inspect, copy, test, or sample the information. (2) Subject to subsections (j)(3) and (j)(4), subdivisions (g), (h), and (i) apply to a person responding to a subpoena under subsection (j)(1) as if that person were a party. (3) A party serving a subpoena requiring production of electronically stored information shall take reasonable steps to avoid imposing undue burden or expense on a person subject to the subpoena. (4) An order of the court requiring compliance with a subpoena issued under this rule must provide protection to a person that is neither a party nor a party s officer from undue burden or expense resulting from compliance. 14

15 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 Arkansas Rule 26.1 has not been the subject of an appellate case in Arkansas since its adoption in Neither has the Court s 2009 per curiam explaining and adopting the rule. Because the rule is largely patterned after the earlier changes to the federal rules, any state court faced with electronic discovery issues is likely to look to federal cases for guidance. (i) Record Retention for State Agencies On March 18, 2005, the Arkansas General Assembly passed Act 918 of 2005, An Act Concerning the Retention of Public Records by State Agencies (codified at Ark. Code Ann et seq.). The Act provides that while the Freedom of Information Act of 1967 provides disclosure guarantees for public records... there is no general requirement for agencies to preserve public records. Ark. Code Ann (a). Therefore, the State of Arkansas is in need of a general records retention law to preserve records that are commonly found in most state agencies for disclosure under the [FOIA], for historical purposes, and for the efficient operation of state government. Id. at (b). Notably, state agencies is defined to exclude constitutional offices and certain other state entities: State agencies means all state departments, boards, and commissions, but does not include the elected constitutional officers and their staffs, the General Assembly and its committees and staffs, the Supreme Court, the Court of Appeals, the Administrative Office of the Courts, and public institutions of higher education with respect to academic, research, health care, and existing information and technology applications and underlying support. Ark. Code Ann (4). 8 Agencies are directed to comply with any record retention requirements promulgated under Act 918 of 2005 by July 1, 2007, or the date of line-item appropriation to the agency in question of funds to comply with the subchapter, if earlier. Ark. Code Ann (c). Any rules that conflict with federal or state law for the retention of public records will be overridden by the conflicting federal or state law. Ark. Code Ann (a). In August of 2006, the Arkansas Records Retention Workgroup, a subdivision of the Arkansas Office of Information Technology, published the Arkansas General Records Retention Schedule. The schedule establishes minimum retention requirements for records created or retained by a state agency. Id. at 5. Further, [t]he retention periods of this schedule apply only to the 8 Presumably, this means that there are no record retention requirements applicable to these exempted entities, and they must only follow the general electronic discovery guidelines applicable to private parties to litigation. Likewise, there are no statutory requirements applicable to local government entities in light of Act 918 of 2005, but local government entities are advised to comply with the Arkansas General Records Retention Schedule, infra, to be safe. 15

16 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 official version of a record. Duplicates of the official version have no retention requirements under this schedule, even if the duplicates are found in different media. Id. The schedule applies to all record formats and media (i.e. electronic, paper, microfiche, etc.), but the minimum retention requirement is determined by content, not format or media. Id. A copy of the Arkansas General Records Retention Schedule is included in your CLE materials. With the exception of those records explicitly included in the retention schedule and contained in electronic form, due to Act 918 of 2005, state agencies do not have a higher duty to preserve electronic records than the duty ascribed to any private party. State agencies can therefore follow the same guidelines as ordinary private parties to litigation (or anticipated litigation), with regard to the preservation and discovery of electronic data or information not covered by the Arkansas General Records Retention Schedule. Likewise, there do not appear to be any specific record retention requirements applicable to local government agencies or entities. However, it s a safe bet for any government entity in Arkansas to adhere to the Arkansas General Records Retention Schedule promulgated in (ii) Spoliation There is authority under Arkansas common law directing parties to litigation or anticipated litigation to preserve evidence, including electronic evidence. Spoliation is defined as the intentional destruction of evidence... See Goff v. Harold Ives Trucking Co., Inc., 342 Ark. 143, 146, 27 S.W.2d 387 (2000) (quoting Black s Law Dictionary 1401 (6th ed. 1990)). When a party is found to have spoliated evidence or the party fails to obey a court s order to provide or permit discovery, the court may employ any of the tools available to it under Arkansas Rule 37(b)(2) to punish the spoliating party and to correct the harm caused by the spoliation. The court may order that the designated facts shall be taken to be established for the purposes of the action in accordance with the claim of the party obtaining the order (Rule 37(b)(2)(A)), the court may refuse to allow the spoliating party to support or oppose related claims or defenses (Rule 37(b)(2)(B)), the court may strike pleadings or parts of pleadings, dismiss the action, or render default judgment (Rule 37(b)(2)(C)), and the court may hold the spoliating party in contempt (Rule 37(b)(2)(D)). The court may also require the spoliating party and/or his or her attorney(s) to pay the reasonable expenses caused by the spoliation (Rule 37(b)(2)(E)). There is an Arkansas Model Jury Instruction which can also be employed by the court to direct an adverse inference as a remedy for spoliation: 9 It is also very important not to forget that there is always a duty to preserve potentially relevant evidence when litigation is reasonably anticipated, supra and infra. 16

17 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 EFFECT OF INTENTIONAL DESTRUCTION OR SUPPRESSION OF EVIDENCE If you find that a party intentionally [destroyed] [or] [lost] [or] [suppressed] with knowledge that [it] [its contents] may be material to a [pending] [potential] claim, you may draw the inference that [the (contents of the) (document) (writing) (photograph) ( )] [an examination of it] would have been unfavorable to his/her [claim] [defense]. When I use the term material I mean evidence that could be a substantial factor in evaluating the merit of a claim or defense in this case. AMI Civil 2011, 106. An instruction on spoliation is designed to remedy litigation misconduct. See Rodgers v. CWR Construction, Inc., 343 Ark. 126, 33 S.W.3d 506 (2000). The adverse inference under the doctrine of spoliation has been drawn, in a case tried to the bench, where a physician failed to dictate a post-surgical note when required by standard medical procedure and public policy to do so. Smith v. United States, 128 F.Supp.2d 1227, (E.D. Ark. 2000). It has been said, in a chancery case involving a destroyed holographic will, that where the instrument destroyed is of such a nature as to destroy all evidence, there follows a conclusive presumption that if produced it would have established the claim of the adversary of him who destroyed the instrument where it is shown that the destruction was willful. Middleton v. Middleton, 188 Ark. 1022, 68 S.W.2d 1003, 1006 (1934). Since the adverse inference is permissive, it is subject to reasonable rebuttal. Stevenson v. Union Pacific R.R. Co., 354 F.3d 739 (8th Cir. 2004). In addition to the adverse inference instruction, criminal sanctions are available under Ark. Code Ann against any person who spoliates evidence, including non-parties: [a] person commits the offense of tampering with physical evidence if he or she alters, destroys, suppresses, removes, or conceals any record, document, or thing with the purpose of impairing its verity, legibility, or availability in any official proceeding or investigation. Id. 10 Also, spoliation of evidence can constitute a factor in the award of punitive damages. See Union Pacific R.R. Co. v. Barber, 356 Ark. 268, 149 S.W.3d 325 (2004), cert. denied, 543 U.S. 940, 125 S.Ct. 320 (2004). Finally, attorneys who are guilty of spoliating evidence are subject to discipline under Rules 8.4(c) and 8.4(d) of the Model Rules of Professional Conduct. 10 The concept of spoliation has also been recognized in criminal cases, where the Arkansas Supreme Court has recognized that a party s falsehood or other fraud in the preparation and presentation of his cause, his fabrication or suppression of evidence by bribery or spoliation, and all similar conduct is receivable against him as an indication of his consciousness that his case is a weak or unfounded one; and from that consciousness may be inferred the fact itself of truth or merit. Anthony v. State, 332 Ark. 595, 600, 967 S.W.2d 552 (1998) (quoting Wigmore, Evidence, 278 (Chadbourne Rev. 1979)). 17

18 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 D. Additional Information: The Sedona Conferences and Principles The Sedona Conference is a nonprofit, 501(c)(3) research and educational institute dedicated to the advanced study of law and policy in the areas of antitrust law, complex litigation, and intellectual property rights. In 2003, the Sedona Conference promulgated the Sedona Principles regarding electronic discovery and the retention of electronic information. The Sedona Principles and other publications of the Sedona Conference have been heavily cited by jurists, attorneys, academics, and others as a pioneering source of information about electronic discovery and other related issues. The Sedona Principles are: 1. Electronic data and documents are potentially discoverable under Fed. R. Civ. P. 34 or its state law equivalents. Organizations must properly preserve electronic data and documents that can reasonably be anticipated to be relevant to litigation. 2. When balancing the cost, burden, and need for electronic data and documents, courts and parties should apply the balancing standard embodied in Fed. R. Civ. P. 26(b)(2) and its state law equivalents, which require considering the technological feasibility and realistic costs of preserving, retrieving, producing, and reviewing electronic data, as well as the nature of the litigation and the amount in controversy. 3. Parties should confer early in discovery regarding the preservation and production of electronic data and documents when these matters are at issue in the litigation, and seek to agree on the scope of each party s rights and responsibilities. 4. Discovery requests should make as clear as possible what electronic documents and data are being asked for, while responses and objections to discovery should disclose the scope and limits of what is being produced. 5. The obligation to preserve electronic data and documents requires reasonable and good faith efforts to retain information that may be relevant to pending or threatened litigation. However, it is unreasonable to expect parties to take every conceivable step to preserve all potentially relevant data. 6. Responding parties are best situated to evaluate the procedures, methodologies, and technologies appropriate for preserving and producing their own electronic data and documents. 7. The requesting party has the burden on a motion to compel to show that the responding party s steps to preserve and produce relevant electronic data and documents were inadequate. 8. The primary source of electronic data and documents for production should be active data and information purposely stored in a manner that anticipates future 18

19 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 business use and permits efficient searching and retrieval. Resort to disaster recovery backup tapes and other sources of data and documents requires the requesting party to demonstrate need and relevance that outweigh the cost, burden, and disruption of retrieving and processing the data from such sources. 9. Absent a showing of special need and relevance a responding party should not be required to preserve, review, or produce deleted, shadowed, fragmented, or residual data or documents. 10. A responding party should follow reasonable procedures to protect privileges and objections to production of electronic data and documents. 11. A responding party may satisfy its good faith obligation to preserve and produce potentially responsive electronic data and documents by using electronic tools and processes, such as data sampling, searching, or the use of selection criteria, to identify data most likely to contain responsive information. 12. Unless it is material to resolving the dispute, there is no obligation to preserve and produce metadata absent agreement of the parties or order of the court. 13. Absent a specific objection, agreement of the parties or order of the court, the reasonable costs of retrieving and reviewing electronic information for production should be borne by the responding party, unless the information sought is not reasonably available to the responding party in the ordinary course of business. If the data or formatting of the information sought is not reasonably available to the responding party in the ordinary course of business, then, absent special circumstances, the costs of retrieving and reviewing such electronic information should be shifted to the requesting party. 14. Sanctions, including spoliation findings, should only be considered by the court if, upon a showing of a clear duty to preserve, the court finds that there was an intentional or reckless failure to preserve and produce relevant electronic data and that there is a reasonable probability that the loss of the evidence has materially prejudiced the adverse party. The amendments to the federal rules, supra, relied heavily upon the Sedona Principles. The Sedona Conference offers free publications on a variety of electronic discovery issues such as the protection of privileged ESI, database principles, and e-discovery glossary, information governance, best practices, resources for the judiciary, primer on social media, ethics and metadata, proportionality, legal holds, and various other topics. The publications are available at this website: 19

20 Electronic Discovery and Document Retention Guidelines for Government Attorneys and Administrators Prepared by Colin Jorgensen, Arkansas Attorney General s Office, June 2015 E. Recent Federal Cases on Electronic Discovery Blue Sky Travel & Tours, LLC v. Al Tayyar, 2015 U.S. App. LEXIS 5166 (4 th Cir. Mar. 31, 2015). The Fourth Circuit Court of Appeals ruled a party is only required to preserve all documents it knew or should have known were or could be relevant to the dispute. Blue Sky Travel & Tours ( Blue Sky ) filed a breach of contract suit against Nasser Al Tayyar ( ATG ) alleging the company did not uphold its agreement to share profits generated from ticket sales to the Saudi Arabian Ministry of Higher Education for student travel. Blue Sky sought the production of invoices of other ticket vendors who provided tickets to ATG, and when ATG failed to produce them despite a court order, sanctions were imposed. ATG moved for reconsideration, arguing Blue Sky s complaint did not put ATG on notice that invoices from vendors other than Blue Sky could be relevant. The magistrate judge imposed an adverse inference instruction which was affirmed by the U.S. District Court for the Eastern District of Virginia. ATG appealed, arguing the court applied an incorrect legal standard when assessing its preservation obligation, and the Fourth Circuit agreed. The appeals court ruled the standard applied by the magistrate judge constituted an abuse of discretion, because a party is not required to preserve all of its documents but rather only those they party knew or should have known were, or could be, relevant to the parties dispute. The case was remanded, with the district court ordered to determine whether ATG spoliated evidence; what sanctions, if any, are appropriate; and whether a news trial on lost profits damages is necessary. Gladue v. Saint Francis Medical Center, 2015 U.S. Dist. LEXIS (E.D. Mo. Mar. 24, 2015). The U.S. District Court for the Eastern District of Missouri held defendant had no duty to preserve when it deleted the s. Saint Francis Medical Center ( Saint Francis ) terminated Marie Gladue and, as part of its routine audit procedure, deleted Gladue s s three months later. Six months after Gladue s termination, her attorney contacted Saint Francis regarding a settlement of employment claims, and two years later, Gladue filed suit. Saint Francis tried to retrieve the s by searching the accounts of employees identified in the parties Rule 26 disclosures, retrieving 7,309 threads which Saint Francis produced to Gladue. A second search produced an additional 17,320 s, although Saint Francis acknowledged it likely had not retrieved every relevant deleted document. Gladue moved for spoliation sanctions, which the district denied, finding 1) Saint Francis did not have a duty to preserve the s when it deleted them as part of routine IT operations; 2) Saint Francis diligently attempted to recover the deleted s and produced a large number of them; and 3) Gladue failed to show that any of the still-missing s were relevant to her claims. Advantor Systems Corp. v. DRS Technical Services, Inc., 2015 U.S. Dist. LEXIS 9721 (M.D. Fla. January 28, 2015). The U.S. District Court for the Middle District of Florida found sanctions were not warranted. Advantor Systems ( Advantor ) alleged that DRS Technical Services ( DRS ) poached Advantor s employee in violation of a noncompete and non-disclosure agreement. When Advantor asked DRS to terminate the employee and preserve all relevant documents and ESI, DRS did so, but not until after reformatting the laptop Advantor s former employee had used while working for DRS. Advantor filed suit and sent a second preservation request. After learning DRS had 20