Electronic Discovery: Background and Best Practices by David M. Shub, Esq.

Transcription

1 Electronic Discovery: Background and Best Practices by David M. Shub, Esq. Note: A version of this white paper was originally published in the conference materials for the Atlanta Bar Association s March 18, 2005, Advanced Employment Law Conference as a companion to Jim Wagner s presentation at that conference.

2 Electronic Discovery: Background and Best Practices 1 A lthough the law of electronic discovery both with respect to statutory requirements and case law precedent is evolving rapidly, one thing has long been clear: electronic documents 1 are just as discoverable as any piece of paper. That fact is increasingly relevant, as each day brings a higher percentage of documents created electronically, a higher percentage of documents that never get printed out, and a higher number of critical communications, often with important attachments, that are transmitted by or instant messaging. 2 To be sure, every matter is likely to involve a substantial amount of traditional paper discovery, but with the way that clients and opposing parties currently conduct business, no discovery effort is complete without allocating appropriate attention to the mass of relevant electronic documents that are likely to exist. This paper has four sections: (1) background on the processes involved in conducting electronic discovery; (2) best practices in responding to electronic discovery requests; (3) a discussion of the proposed changes to the Federal Rules of Civil Procedure affecting electronic discovery; and (4) suggestions for making electronic discovery more affordable. 1. The Background of ediscovery Electronic discovery consists in the locating, gathering, preparing, reviewing, and producing of information stored in electronic form. While, generally speaking, traditional paper discovery involves these same efforts, the manner in which each aspect of electronic discovery is executed is markedly different. There are a few reasons that electronic discovery is different than traditional paper discovery. Unlike paper documents, which are typically stored in one format, electronic documents can be stored in a variety of storage media (such as local hard drives, CDs and DVDs, PDAs, networked hard drives, cell phones, etc.). Also, electronic document storage media are more fragile than paper; it is not uncommon for files to become damaged or lost, so it is critical that due care be taken when collecting electronic information. Perhaps most importantly, electronic documents contain metadata that is not found on typical paper documents. Metadata is information about an electronic file or piece of data, such as the date the file was created, last accessed, or last printed, and by whom. Also sometimes referred to as metadata, are two groups of data that are more properly termed hidden data and replicant data. Hidden data refers to comments, tracked changes, and hidden cells or columns information that is 1 Document includes any form of information, whether a handwritten note, an file, or a video or audio recording. FED. R. CIV. P. 34 (amended in 1970 to include data compilations ). 2 Common estimates over the past year or two are that more than 11 billion s are transmitted daily, more than 93% of business documents are created electronically, and more than 70% of electronically-created documents are never printed on paper.

3 Electronic Discovery: Background and Best Practices 2 available in the electronic file when certain viewing options are selected, but which typically are not printed out if the file is ever printed. Replicant data is certain information that is associated with the file and can be called up if requested, such as Undo/Redo changes. Taken together, these three classes of electronic data may include significant additional information relevant to disputed facts within a given matter. Because of these important differences, electronic discovery focuses on additional facets that typically do not require scrutiny when conducting traditional paper discovery. In the context of electronic discovery, the work falls into five main categories: 1. Forensics 2. Acquisition 3. Conversion 4. Review 5. Production Forensics involves the task of finding the information. Before forensics can be employed, counsel must identify all the sources that may contain relevant information. The forensic effort, then, involves examining those sources to determine the best way to preserve and capture relevant information. Forensics is typically performed by an IT expert, either an IT staff member of counsel or the client or a third-party IT specialist. The acquisition process typically follows directly on the heels of the forensic. Often, the same IT expert who conducts the forensic search then performs the acquisitive capture. The IT expert takes appropriate care not to alter the original source and to ensure that the acquired copy represents a true duplicate of the original. The precise nature of the copy that is required may vary, depending on the facts of the underlying case and negotiated agreements between the parties. When the data is converted, it is processed into a common format to enable review on a single platform. In the early years of electronic discovery, the data (including metadata and hidden data) was extracted from the acquired files, deduplicated to save reviewers time by removing duplicative copies of electronic files, and placed into a single database containing all the data fields of each file. The database was then coupled with a load file that enabled the data to be accessed by the reviewer s chosen tool. A more modern approach processes the files by generating a conceptual index that automatically determines which electronic files are related and groups them for reviewers convenience. That more modern approach also takes advantage of de-duplication technology. In general terms, the review of electronic documents is the same as the review of paper documents. Counsel searches for relevant information, both to respond to discovery requests and to assess the case. Privileged documents are tagged so

4 Electronic Discovery: Background and Best Practices 3 that they can be segregated and listed on a privilege log. For years, counsel have taken advantage of litigation-specific review tools that organize and speed the review process. More recently, with the ever-growing quantity of electronic documents and sophistication of parties who increasingly request discovery of such documents, the review process has become progressively burdensome and counsel has sought help in the review from temporary attorneys or outside review agencies promising accuracy improvements and cost savings; counsel always maintains close supervision of the review process. Production can occur in a number of formats. Typically, the production format is at the option of the requesting party, unless that format can be shown to be unduly burdensome. A current proposed amendment to Federal Rule of Civil Procedure 34(b) would overtly state that the requesting party may select the method of production, subject to producing party s objection. The amendment adds, however, that if the requesting party fails to specify a particular method, the producing party may produce in any electronically searchable form. Parties, of course, may agree on any production format they choose, but barring such agreement, the proposed amendment would preclude production of electronic information in the form of a paper-printout or even in the form of an electronic image that does not properly imbed searchable text. These categories will be addressed further in the context of the best practices discussion below. There are many ways to go about each. At the outset, it is important to note that whereas electronic documents, insofar as they are susceptible to electronic search tools, are easier to review than paper documents, the overall complexity of assuring that electronic documents are located, gathered, processed, and fully reviewed requires that the issue of electronic discovery be confronted early in the discovery process. Indeed, under a current proposed amendment to Federal Rule of Civil Procedure 26(f) (Conference of Parties; Planning for Discovery), counsel will be required to familiarize itself with its client s systems for storing electronic data and be prepared to take steps to preserve that information for possible discovery no later than 21 days before the Rule 16 scheduling conference or scheduling order is due. In any event, it is prudent for counsel to become as familiar as possible with the ways in which the client stores all of its documents and data, if only to ensure that counsel has the opportunity to examine the information that affect its client s case. 2. Best Practices in Responding to ediscovery Requests When describing the best practices in responding to an electronic discovery request, the most sensible approach is to discuss each practice in the order in which it should be performed, starting with the advent of a case and continuing through the discovery period. However, some practices overlap with regard to their appropriate time for execution, and the order of others may vary slightly

5 Electronic Discovery: Background and Best Practices 4 depending on counsel s strategy and evaluation of the potential costs and benefits of different approaches. Nevertheless, a general listing of best practices, along with a typical order in which they are conducted, is as follows: 1. Prevent Spoliation 2. Formulate Plan for Discovery 3. Negotiate with Opposing Counsel 4. Make Any Appropriate Discovery Motions 5. Identify Relevant Storage Media 6. Gather Relevant Storage Media 7. Process and Review Electronic and Paper Media 8. Prepare Production Set 9. Produce in a Timely Fashion Prevent Spoliation As soon as a party becomes aware that it is likely to become involved in a lawsuit, that party has an obligation not to destroy or lose relevant information. In the age of electronic information, an unfortunate number of cases are impacted heavily by a party s failure to heed that requirement. Spoliation sanctions can range from fines all the way through dismissal with prejudice. 3 Notably, a company that is party to a lawsuit will suffer the penalty when its employees, even if acting against company policy, engage in spoliation. 4 Furthermore, one prominent decision noted that counsel knows far more about litigation hold obligations than its client, and therefore counsel has a duty not just to inform the client of its obligations, but to ensure that the relevant employees are properly informed and that appropriate litigation hold procedures are successfully implemented. 5 Consider whether routine recycling of backup tapes must be suspended, whether it would be appropriate to make preservation copies of key players hard drives or network drives, and what steps might be prudent to prevent a rogue employee from taking actions that might cause severe trouble for the corporate client down the line. Note that the very publication of a notice that data must be preserved for ongoing litigation may lead some employees to clean up their files. Therefore, counsel should consider conducting a quiet seek and duplicate mission to make quick preservation copies of hard drives or 3 See, e.g., QZO, Inc. v. Moyer, 594 S.E.2d 541 (S.C. Ct. App. 2004) (in suit between former business partners involving alleged violation of State unfair trade practices act, Defendant s pleadings struck and motion entered for Plaintiff after Defendant delayed production of hard drive for seven days and was found to have erased hard drive in intervening time). 4 See, e.g., Zubulake v. UBS Warburg, 2004 U.S. Dist. LEXIS (S.D.N.Y. July 20, 2004) (Zubulake V) (Court determined it was appropriate to issue an adverse inference against Defendant company after employees deleted relevant to employee s gender-discrimination and Title VII retaliation lawsuit); United States v. Philip Morris USA, Inc., 2004 U.S. Dist. LEXIS (D.D.C., July 21, 2004) (company fined $2.75 million after 11 managers and officers failed to comply with the company s print and retain retention policy); In re Prudential Sales Practices Litigation, 169 F.R.D. 598 (D.N.J. 1997) (company fined $1 million for failing to instate appropriate procedures to preserve information following Court preservation order). 5 Id. at *46, *60.

6 Electronic Discovery: Background and Best Practices 5 other relevant media before spoliation harm can occur. Finally, it may be prudent to seek a court order defining the boundaries of the duty to preserve. Formulate Plan for Discovery As early as possible, counsel should formulate a discovery plan. Of course, in forming a discovery plan, it is helpful to know as much about the relevant actors, key facts, and the nature of the client s information storage system(s). Once taking some (brief) time to get a handle on those concerns, it is critical that a plan be formed for the broader discovery effort. That plan should set forth a working schedule for the remaining steps of the discovery process, establish the methodologies that will be used to identify, gather, process, and review paper and electronic documents, and specify the final production format (which may differ from the format in which the documents are reviewed). Refer to the sections below for guidance on making determinations about which methodologies and tools to use at this early stage. It may be helpful to consult a colleague or vendor someone who has been through the electronic discovery process before and has a sense of all the steps that must be taken and the general time frame that may be involved for each. To the extent that such a consultation has not already occurred, it is critical to consult with the client s IT staff to learn about the client s information storage and backup systems so that spoliation prevention and document acquisition can be successful. Negotiate with Opposing Counsel As with paper discovery, all electronic discovery requests are negotiable. It is easy to draft an overbroad or unduly burdensome request for electronic documents, and counsel should be prepared to suggest limitations as to the relevant time period, subject matter, and personnel (especially with regard to ). Oftentimes, keyword searches can be employed to obtain a set of documents likely to contain all relevant information and evidence while placing a much smaller burden on the responding party. 6 Indeed, a sympathetic court may grant a protective order upon a proper motion where the requesting party does not appropriately limit its discovery request. 7 When a client is served with a document request despite not being a party to the related action, the court will 6 Tulip Computers Int l v. Dell Computer Corp., 2002 U.S. Dist. LEXIS 7792, 52 Fed. R. Serv. 3d (Callaghan) 1420, 63 U.S.P.Q.2D (BNA) 1527 (D. Del. Apr. 30, 2002) (adopting Plaintiff s proposal of identification of responsive documents by keyword search); Ex parte Wal-Mart, Inc., 809 So.2d 818, 2001 Ala. LEXIS 283 (Ala. 2001) (Defendant not required to comply with discovery request that did not place appropriate limitation on subject matter, although it was properly limited as to time period and geographic location). 7 See, e.g., Wright v. AmSouth Bancorporation, 320 F.3d 1198 (11th Cir. 2003) (Plaintiff s motion to compel discovery of a computer diskette or tape copy of all word processing files created, modified and/or accessed by, or on behalf of five [of Defendant s] employees over a two and one-half year period. [Plaintiff] made no attempt to narrow his request to something more meaningful and relevant during the discovery period despite an appropriate objection from [Defendant] ).

7 Electronic Discovery: Background and Best Practices 6 pay special attention to the burden being imposed. 8 Regardless of whether the client is a party, you may also ask the requesting party to shoulder some of the expense involved in responding to the request. Although the general rule is that the producing party bears the expense of responding to discovery requests, the expense involved in restoring certain storage media, if required, may present an unreasonable expense such that cost-shifting may be appropriate. 9 When you negotiate with opposing counsel, you want to know as much as possible about the strengths and weaknesses of your client s evidence. Therefore, it may be prudent to conduct a limited investigation of or other electronic documents (as well as interviews of relevant personnel) before beginning negotiations. Be careful, however, not to compromise the integrity of original files or storage media while conducting such an investigation. Be sure to only review copies never work with the originals, whose metadata may be forever altered simply by being opened and viewed. Make Any Appropriate Discovery Motions If negotiation is insufficient to achieve reasonable results, it may be appropriate to seek redress from the court. Counsel should consider making a request to the court to shift some or all of the costs of production to the requesting party. Especially where information from backup tapes is requested, courts typically apply multi-part tests to determine whether cost-shifting is appropriate, and the degree to which costs should be shared. 10 Courts are also willing to condone failures to comply with overbroad discovery requests, 11 or to tailor search and production methodologies to reduce the 8 See, e.g., Braxton v. Farmer s Ins. Group, 209 F.R.D. 651 (N.D. Ala. 2002) ( s not discoverable from third-party agents of Defendant where Defendant could provide copies of such s without imposing significant burden on third parties). 9 See Zubulake v. UBS Warburg LLC, 217 F.R.D. 309 (S.D. N.Y. 2003) (Zubulake I) (establishing 7-factor test for determining appropriateness for cost shifting when difficult-to-access electronic documents were requested); Mississippi Rule of Civil Procedure 26(b)(5) (When a party requests electronic information that cannot be retrieved through "reasonable efforts," the court may "order that the requesting party pay the reasonable expenses of any extraordinary steps required to retrieve and produce the information." 10 See, e.g., Zubulake v. UBS Warburg LLC, 216 F.R.D. 280, 2003 U.S. Dist. LEXIS (S.D. N.Y. 2003). 11 See, e.g., Dikeman v. Stearns, 560 S.E.2d 115 (Ga. Ct. App. 2002) (finding Defendant's request for numerous records, including a copy of Plaintiff's hard drives, to be unduly overbroad, oppressive, and annoying, and to require undue burden and expense); Southern Diagnostic Assocs. v. Bencosme, 833 So. 2d 801 (Fla. Dist. Ct. App. 3d Dist. 2002) (vacating Trial Court's order compelling discovery as overbroad and directing Trial Court to craft an appropriately tailored order protecting confidentiality during review of computer system); Ex parte Wal-Mart, Inc., 809 So. 2d 818, 2001 Ala. LEXIS 283 (Ala. 2001) (Defendant not required to comply with discovery request that did not place appropriate limitation on subject matter, although it was properly limited as to time period and geographic location).

8 Electronic Discovery: Background and Best Practices 7 burden of responding. 12 Counsel makes it much easier for the court to rule in its favor if it suggests a less burdensome alternative set of requests or search methodology that would produce a set of documents reasonably likely to contain the relevant information sought by the requesting party. 13 Identify Relevant Storage Media As opposed to the process of collecting paper documents, where counsel generally need look only to a person s office desk, local shelving or filing cabinets, and central storage areas, identifying the various media in which a person s electronic documents are stored can be a more complex task. It would not be unusual for someone in a company s IT department to know more about where and how employees documents are stored and backed up than the employees themselves. Therefore, counsel should consult with both the person whose documents are being sought and an appropriate person within the client s IT department. Be sure to ask about portable as well as fixed media, the backup tape system, and any home-based or personal computer or other device on which work-related documents may reside. Find out whether an employee has downloaded or installed additional software, such as instant messaging or internet-based accounts, which the client may not be aware of, let alone condone. Gather Relevant Storage Media Unlike paper documents, which may simply be picked up and sent out for photocopying (or imaging), electronic documents require special handling. Most importantly, counsel should make sure that the client never conducts a homemade review. That is not to say that corporate counsel may not oversee the collection effort, but it would be extremely dangerous to allow the client s employees, for example, to look through their inboxes and folder and forward s that they believe are relevant. Just as counsel would not have a client look through its paper files and select only those documents it believes are relevant, counsel does its client a disservice by allowing its employees to make relevancy determinations. The relevancy determination is inherently subjective, and the obvious bias of the client and its employees would most likely affect the client s relevancy determinations. Furthermore, end-user-based electronic document collection is nearly certain to result in an alteration of the metadata every time the user opened a document to review it or dragged and dropped it to a responsive folder. And involving end users in the collection process simply gives opposing counsel a reason to put them on the stand at trial. Instead, 12 See, e.g., Pamlab, L.L.C. v. Rite Aid Corp., 2004 U.S. Dist. LEXIS (E.D. La. Oct. 13, 2004) (ordering production of all electronically-stored records of dispensation of a particular prescription, but requiring only sampling of any such records that had to be collected manually, a task found to be too burdensome for full searching and production). 13 See, e.g., Tulip Computers Int l v. Dell Computer Corp., 2002 U.S. Dist. LEXIS 7792, 52 Fed. R. Serv. 3d (Callaghan) 1420, 63 U.S.P.Q.2D (BNA) 1527 (D. Del. Apr. 30, 2002) (adopting Plaintiff s proposal of identification of responsive documents by keyword search)

9 Electronic Discovery: Background and Best Practices 8 counsel should employ an IT expert (from counsel s staff, the client s staff, or an outside source) who can make an appropriate forensic copy of storage media that are likely to contain responsive documents. With assistance from the expert, counsel should maintain a chain of custody log that details the recovery efforts and documents the migration of data from each storage medium to the next. Process and Review Electronic and Paper Media The methodology used to process the storage media and information contained therein depends on the review tools and methodology that will be used. For greatest efficiency and reviewing ease, all documents should be reviewed on a common platform. That platform could be as simple as paper (in which case all electronic documents are printed out a highly disfavored solution) or as sophisticated as a concept-based tool that uses linguistic and other algorithms to group related documents (in which case all paper documents are imaged and undergo optical character recognition (OCR) processing the most favored solution). Use of a concept-based tool is best because of the efficiencies it creates in allowing reviewers to hone in on particular issues and rapidly make judgments about the relevance of entire groups. Concept-based tool use requires processing of all documents by an analysis application that runs the various algorithms to establish the document relationships. Next best is a litigation-specific database, such as Concordance, Summation, or proprietary tools used by various electronic discovery processing vendors. Those are powerful applications, which reduce review time and difficulty by deduplicating (using only one copy of each electronic document, regardless of the number of times it appears in the document set), enabling the use of Boolean searches, and providing powerful redacting, notation, and tagging tools. (All of those advantages are also enjoyed by concept-based search tools.) Prior to use of a litigation-specific database, all files must be processed by an application that extracts the file data, metadata, and hidden data. The extracted information (from any variety of file types) is then used to populate a single database, from which identical copies are de-duplicated. Each record in the database may be associated with an electronically-printed image of the document as well as with a link to the document using its native application. Electronic documents can also be reviewed through the native software applications through which they were originally created. However, such review technique does not take advantage of de-duplicating, does not reveal metadata, hidden data, or replicant data unless the reviewer adjust settings taking many steps for each document, does not easily permit the use of redacting, notation, and tagging tools, requires the use of a separate database to track the documents and any reviewer comments or findings, does not benefit substantially from integration of paper documents, and is generally cumbersome, requiring the user to open a new software application each time a new file type is

10 Electronic Discovery: Background and Best Practices 9 encountered. To compensate for its review shortcomings, there is no processing required to review documents in their native format. Lastly, roughly on par with paper review, is review of electronically printed images. Such review has the advantage over paper of being reviewable from any location with internet access or on any computer onto which the images have been loaded, and can be shared relatively easily with co-counsel, but cuts off any ability to review metadata, hidden data, and replicant data, and fails to take advantage of any of the powerful tools available to speed electronic review. The processing, of course, requires electronic printing of each page of each electronic document, which can be a costly proposition. Prepare Production Set The format of the production need not match the review format. The requesting party may request production in any format, and the producing party may object or attempt to negotiate a different production format. If the proposed amendment to Federal Rule of Civil Procedure 34(b) is adopted, the requesting party will be entitled to select the method of production, subject only to the producing party s objection. If, however, the requesting party does not specify any method, the producing party will be permitted to produce in any electronically searchable form. To avoid unnecessary arguments, it is best to discuss production format with opposing counsel and to attempt to reach a mutually agreeably format. Produce in a Timely Fashion The penalties for failure to produce in a timely fashion can be as severe as the penalties for spoliation. A plaintiff s failure to adhere to an established production schedule can result in dismissal with prejudice. 14 A defendant may face severe fines for failure to comply with discovery requests with sufficient speed. 15 Under sufficiently severe circumstances, failure to produce in a timely fashion may result in default judgment. 16 Starting the search for, and processing of, electronic data early and making and adhering to a sound discovery plan will put counsel well on its way to meeting discovery deadlines and avoiding any delay-based sanctions. 14 See, e.g., Mariner Health Care Inc. v. PricewaterhouseCoopers, No. 02-VS F (St. Ct. Fulton Cty. Ga. filed Aug. 29, 2002) (Plaintiff's $500 million lawsuit for accounting fraud dismissed after Plaintiff's ongoing failure to produce requested documents in a timely fashion). 15 See, e.g., In re Banc of America Securities LLC, 2004 SEC LEXIS 548, SEC Exchange Act Rel. No , Mar. 10, 2004 (Defendant fined $10,000,000 for failing to "promptly furnish" certain records requested by the Securities Exchange Commission pursuant to an investigation). 16 Commissioner of Labor of N.C. v. Ward, 2003 N.C. App. LEXIS 1099 (N.C. Ct. App. June 3, 2003) (Default judgment after Defendant failed to comply with orders requiring production of documents from various sources, including backup tapes, hard drives, and removable drives and refused to cooperate in efforts to access data recovered from backup tapes).

11 Electronic Discovery: Background and Best Practices Proposed Amendments to the Federal Rules of Civil Procedure As referenced above, the Committee on Rules of Practice and Procedure of the Judicial Conference of the United States has proposed amendments to the Federal Rules of Civil Procedure (FRCP) to address concerns generated by electronic discovery. The substance of the proposed changes occurs in three separate Rules Rules 26, 34, and 37. The Committee proposed a number of changes to Rule 26. Rule 26(b)(2), which describes limitations on discoverable information, would be amended to add that a party would not be required to produce information that it identified as not reasonably accessible. This amendment is geared principally towards limiting the expense of restoring backup tapes and deleted electronic data still resident on hard drives or other storage media. Once the responding party identified information as not reasonably accessible, the requesting party would have the opportunity to challenge that assertion, and the responding party would then have the burden of demonstrating that the information is not reasonably accessible. If the responding party made such a showing, the court could still order discovery for good cause, subject to the court s terms and conditions. Rule 26(b)(5)(B) would add a provision related to the inadvertent production of privileged information. The proposed amendment provides that a party may within a reasonable time notify a party that received information that the information is privileged. The comments to the Rule explain that factors bearing on the reasonable time determination include the date when the producing party learned of the production, the extent to which other parties had made use of the information in connection with the litigation, the difficulty of discerning that the material was privileged, and the magnitude of production. The party in possession of the information would then be required to return it to the producing party, which would be required to preserve it pending court ruling on the privileged nature of the information. That amendment would not have any effect on the determination of whether the production resulted in a waiver of the asserted privilege. Related to the addition of Rule 26(b)(5)(B), Rule 26(f)(4) would also be added. The new Rule 26(f)(4) would require that parties, in their pre-rule 16 conference, produce a proposed discovery plan indicating parties views and proposals concerning whether the court should enter an order protecting privilege despite inadvertent production. Such claw back (allowing the producing party to assert privilege after production) or quick peek arrangements (allowing the requesting party to review all of the producing party s documents and select the relevant subset, then allowing the producing party to review the selected subset and pull out privileged documents), however, contain a danger. There is a question as to whether, even if the court upholds an agreement that inadvertent disclosure not be considered a waiver of the privilege for the purposes of the immediate action, the information may be considered waived with respect to future litigations.

12 Electronic Discovery: Background and Best Practices 11 Rule 26(f), in general, requires parties to confer at least 21 days before the court s Rule 16 scheduling order is due. The Committee has proposed that the Rule 26 conference include discussion of issues relevant to preservation of evidence. If the change is adopted, counsel would need to learn early about its client s methods for storing information both paper and electronic to be in a position to discuss the preservation of such information. Proposed Rule 26(f)(3) requires that the aforementioned discovery plan reflect views and proposals concerning any issue relating to the disclosure or discovery of electronic information, including production form. Aside from production form, the comments to the proposed Rule suggest that the parties may discuss such items as: topics for discovery, the time period for discovery, sources of electronic information that should be searched, and who should bear the cost of retrieving and reviewing certain types of information. The proposed change to Rule 34 involves the format for production of electronic information. Rule 34 would provide that the requesting party may request production in any format. The producing party may then object to the production format, just as it currently may object to the nature of any item within a document request. If, however, the requesting party fails to specify a production format, the responding party may produce electronic information either in the form in which it is ordinarily maintained or in any electronically searchable form. New Rule 37(f) would add a safe harbor seeking to protect against claims of spoliation in certain circumstances. Under Rule 37(f), unless a court order requiring preservation were in place, a court could not sanction a party under the FRCP for failing to produce electronic information if (1) reasonable steps were taken to preserve information after it knew or should have known that the information were discoverable; and (2) the failure resulted from loss of the information because of the routine operation of the party's electronic information system. The comments explain: The reference to the routine operation of the party's electronic information system is an open-ended attempt to describe the ways in which a specific piece of electronically stored information disappears without a conscious human direction to destroy that specific information. Note, however, that the safe harbor does not protect against any sanctions imposed under a court s inherent authority. Furthermore, the comments to the Rule explain that it would not protect against any loss of information that occurred before an action was filed. 4. How to Make ediscovery More Affordable for Every Case There is no question that electronic discovery can be expensive. The expense can be controlled various ways, but it is important to realize at the outset that the discovery of electronic evidence is generally not optional. Unless counsel can

13 Electronic Discovery: Background and Best Practices 12 demonstrate some good reason why electronic documents should not be produced, electronic documents will be as discoverable as paper. Therefore, the question of expense does not typically relate to whether costs can be saved by not producing electronic documents. Rather, the question is how to keep such costs as low as possible. The first key is to begin early. Electronic discovery can be a complex adventure. Beginning early allows time to compensate for difficulties encountered along the way. The savings can be substantial. While the many hours of in-house or vendor work it can take to carry an electronic discovery through to production can generate substantial bills, even greater expenses are incurred when there are rush jobs requiring overtime, overtaxing in-house or vendor resources, or even bringing in additional, more expensive vendors to complete production according to schedule (and all exhausted extensions). Another important avenue to pursue is reflected above in the Best Practices section negotiate with opposing counsel (and if necessary seek court redress) to place reasonable limitations on the scope of the document request. It may be appropriate to limit based on a date range, a narrow group of relevant employees, type of data (active versus backup, for example), or by using keyword search terms. Such limitations may drastically reduce the universe of potentially relevant documents while still affording the requesting party a reasonable opportunity to obtain discovery of relevant documents likely to lead to admissible evidence. If the document to be reviewed for possible production is electronic, keep it electronic. Costs increase dramatically each time a piece of paper gets handled. Take advantage of one or more of the powerful tools for managing, processing, reviewing, and producing electronic evidence; the reward is not full relief from any expense, but expenses will be cut drastically and counsel will become far more efficient in understanding the key issues in the matter and reviewing documents for privilege and relevancy. When choosing processing tools (which will depend on the particular reviewing tool and methodology to be used), reduce vendor fees by minimizing processing costs. Accomplish this by keeping electronic information in its native format, rather than running applications to extract data and print electronic images of documents. Such extraction and electronic-printing efforts bestow huge benefits when compared with traditional paper review, but fall short of maximum efficiency. Instead, keep documents in their native formats, and use a conceptbased processing tool that examines the electronic files and groups them by the relatedness of their data and metadata. All of the above techniques lead to the way to reduce the biggest expense associated with electronic discovery the legal fees for review and management of the discovery process. As detailed above in the Best Practices section,

14 Electronic Discovery: Background and Best Practices 13 substantial savings of time (and vendor expense) can be realized through taking advantage of optimal technological tools. In-house IT staff, a client s IT staff, or a reliable vendor can educate and implement those tools; certain vendors may also provide personnel trained on the use of such tools to manage or help conduct the review process. In addition to the tools, consider the advantage of having established practices in place to maximize the efficiency and effectiveness of review. Think carefully about whether it may be in the client s best interest to conduct various kinds of quality control to ensure that reviewers privilege and relevance determinations are accurate. The most effective procedures will take advantage of metrics taken describing each reviewer s performance to determine the type of quality control to be applied to that reviewer s work and whether additional training of that reviewer may be warranted. Taking the procedural and technological steps may present some costs in the short term, but over the span of an involved review process the dividends that those steps pay can be enormous.