A PRACTICAL GUIDE TO E-DISCOVERY CLE Credit: 2.0 Friday, June 8, 2012 9:40 a.m. - 11:50 a.m. Combs-Chandler Room Galt House Hotel Louisville, Kentucky 1
A NOTE CONCERNING THE PROGRAM MATERIALS The materials included in this Kentucky Bar Association Continuing Legal Education handbook are intended to provide current and accurate information about the subject matter covered. No representation or warranty is made concerning the application of the legal or other principles discussed by the instructors to any specific fact situation, nor is any prediction made concerning how any particular judge or jury will interpret or apply such principles. The proper interpretation or application of the principles discussed is a matter for the considered judgment of the individual legal practitioner. The faculty and staff of this Kentucky Bar Association CLE program disclaim liability therefore. Attorneys using these materials, or information otherwise conveyed during the program, in dealing with a specific legal matter have a duty to research original and current sources of authority. Printed by: Kanet Pol & Bridges 7107 Shona Drive Cincinnati, Ohio 45237 Kentucky Bar Association 2
TABLE OF CONTENTS The Presenters... i Electronic Discovery Matters: How It Applies to All Areas of Practice... 1 Marjorie Webster v. Roadrunner Gorgeous Metro, Inc. and Roadrunner Gorgeous, Inc.... 5 Federal Circuit Model E-Discovery Order for Patent Litigation... 9 Information Management Considerations during Corporate Reorganization Recognizing and Avoiding Common Pitfalls... 11 Diamonds in the Rough: Finding Gems in a Well-Executed Document Review... 19 E.U. Data Privacy Law Comes to a Courtroom Near You... 29 Cloud Computing: ediscovery Issues and Other Risk... 41 ediscovery Pilot Programs Illustrate Opportunities to Avoid Unnecessary Cost... 47 Qualcomm Six Ultimately Avoid Sanctions but Case Remains a Cautionary Tale... 55 Recent S.D.N.Y. Decision Declares Failure to Issue a Litigation Hold Gross Negligence and Outlines Standards for Preservation and Collection... 59 New Evidence Rule Limits Waiver of Attorney-Client Privilege and Promotes Judicial Economy in Discovery... 65 3
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THE PRESENTERS Wendy Butler Curtis Orrick, Herrington & Sutcliffe Columbia Center 1152 Fifteenth Street NW Washington, D.C. 20005-1706 (202) 339-8400 WENDY BUTLER CURTIS serves as ediscovery of Counsel to Orrick, Herrington & Sutcliffe in Washington, D.C. and is chair of their ediscovery Working Group. Her practice is focused in the area of litigation. Ms. Curtis received her B.A., cum laude, from the University of New Hampshire and her J.D. from the University of Maryland School of Law. She is a member of the Sedona Conference, Arma International, Women in ediscovery, the District of Columbia Bar Association s Litigation Section and the American Bar Association s Pretrial Practice and Discovery Committee, Trial Evidence Committee, Technology for the Litigator Committee, Woman Advocate Committee and ediscovery Committee. Ms. Curtis also devotes a portion of her practice to pro bono matters including adoption cases and the Lawyers Serving Warriors and National Veterans Legal Services Program. James W. Herr ResCare, Inc. 9901 Linn Station Road Louisville, Kentucky 40223 (502) 520-2592 JAMES W. HERR serves as Deputy General Counsel at ResCare, Inc. where he assists in the direction and management of ResCare, Inc. programs and work. Prior to joining ResCare, Mr. Herr was a Fellow at Health Enterprises Network and a member at Greenebaum, Doll & McDonald, PLLC (now Bingham Greenebaum Doll). He received his B.A. from the University of Kentucky and his J.D. from the Brandeis School of Law at the University of Louisville, where he served as Articles Editor on the Brandeis Law Journal and on the Moot Court Board. i
Lira A. Johnson Dinsmore & Shohl, LLP 101 South Fifth Street, Suite 2500 Louisville, Kentucky 40202 (502) 540-2328 LIRA A. JOHNSON is a partner in the Labor & Employment Department of Dinsmore & Shohl, LLP, practicing in the firm s Louisville office. Her practice is concentrated in the areas of employment and labor law and employee benefits. Ms. Johnson received her B.S. from Indiana University and her J.D. from Indiana University School of Law Bloomington. She is admitted to practice before the United States District Court for the Eastern and Western Districts of Kentucky, and Eastern and Southern Districts of Michigan, the United States Court of Appeals for the Sixth Circuit and the United States Supreme Court. Ms. Johnson is a member of the Louisville, Kentucky, Michigan, Wisconsin and American Bar Associations, the Society for Human Resource Management and the Louisville Employee Benefits Council. Daniel L. Regard idiscovery Solutions, Inc. 3000 K Street NW, Suite 330 Washington, D.C. 20007 (202) 550-4764 DANIEL L. REGARD is the CEO and Managing Partner of idiscovery Solutions, Inc. and focuses his practice in the area of ediscovery. Mr. Regard received his B.S. from the University of Southwestern Louisiana and his J.D. from Tulane University. He is a member of the Louisiana Bar Association, and Sedona Conference; and is the founder of Masters Conference Cabinet. Mr. Regard serves as a Board member for Georgetown Advanced Institute for e-discovery, College of e-neutrals and on the Editorial Advisory Board of Law Technology News. In addition, he is the Director of e-discovery Institute. ii
Judge Barry Willett Jefferson Circuit Court Division One 700 West Jefferson Street Louisville, Kentucky 40202 (502) 595-4054 JUDGE BARRY WILLETT was elected to the Jefferson Circuit Court bench in 2000. He is a graduate of the University of Kentucky and the Brandeis School of Law at the University of Louisville. Prior to his election to the bench, Judge Willett practiced law specializing in complex tort and commercial litigation. He is a past president of the Kentucky Justice Association and has served as a Special Justice on the Supreme Court of Kentucky. Judge Willett completed a certification level course of mediation training at the Duke University Private Adjudication Center in 1995. He is a frequent speaker in continuing legal/judicial education programs. Judge Willet served as Chief Judge of the Jefferson Circuit Court General Term for 2010-2011. iii
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ELECTRONIC DISCOVERY MATTERS: HOW IT APPLIES TO ALL AREAS OF PRACTICE Wendy Butler Curtis I. HOW DOES ELECTRONIC DISCOVERY APPLY TO YOUR PRACTICE? A. Criminal Attorney 1. Search warrants. a. U.S. v. Ochoa, 2012 WL 104997 (5th Cir.). b. U.S. v. Comprehensive Drug Testing, Inc., 579 F.3d 989 (9th Cir. 2009). 2. Subpoenas. U.S. v. Warshak, 631 F.3d 266 (6th Cir. 2010). 3. Preservation, search methods, production format. U.S. v. O Keefe, 537 F.Supp.2d 14 (D.D.C. 2008). 4. Prosecution. U.S. v. Briggs, 2011 WL 4017886 (W.D.N.Y.). B. Civil Attorney 1. Preservation scope and trigger. 2. Types of data what to request, what the other side requested of your client. 3. Production format. 4. Burdens and costs. 5. Consequences sanctions and cost-shifting. C. Family Law Attorney 1. Types of data. a. E-mail. b. Social media. 1
c. GPS tracking. d. Cell phone records. 2. Possession, custody or control. D. Some of the Different Technologies for Practitioners to Consider are 1. Cell phone tracking. 2. Social media (e.g., Foursquare). 3. EZPass. II. WHAT ARE YOUR ETHICAL OBLIGATIONS IN ELECTRONIC DISCOVERY? A. Provide Competent Legal and Technical Advice ABA Model Rule 1.1 B. Avoid Unnecessary Expense for Your Client ABA Model Rule 1.5 C. Communicate Obligations, Risks and Costs to Your Client ABA Model Rule 1.4 D. Protect Privilege, Confidentiality and Security of Client Information 1. ABA Model Rules 1.6 and 1.15. 2. Holmes v. Petrovich Dev. Co. LLC, 119 Cal.Rptr.3d 878 (Cal.App. 2011). 3. Association of the Bar of the City of New York Ethics Opinion 2008-1. E. Provide Honest, Ethical and Accurate Communications with Courts, Client and Opposing Parties 1. ABA Model Rules Rule 3.3, 3.4 and 4.4. 2. Mancia v. Mayflower Textile Servs. Co., 253 F.R.D. 354, 357-358 (D.Md. 2008). F. Appropriately Supervise All Attorneys, Non-Lawyer Assistants and Service Providers 1. ABA Model Rules 5.1, 5.2, 5.3, 5.5, and 5.7. 2
2. Stuart I. Levin & Assocs., P.A. v. Rogers, 156 F.3d 1135, 1141 (11th Cir. 1998). 3. Bray & Gillespie Mgmt. LLC v. Lexington Ins. Co., 259 F.R.D. 568, 588-589 (M.D. Fla. 2009). 4. First Amended Complaint for Damages: J-M Manufacturing Company Inc. v. McDermott Will & Emery, No. CV11-6666, (C.D. Cal., August 9, 2011). 5. In re Seroquel Prods. Liab. Litig., 244 F.R.D. 650, 664 n.14 (M.D. Fla. 2007). III. TRENDS IN ELECTRONIC DISCOVERY LAW A. Potential Amendments to the Federal Rules of Civil Procedure B. State and Local Electronic Discovery Rules C. Model Orders and Pilot Programs IV. MOCK MEET-AND-CONFER AND PRE-TRIAL CONFERENCE A. Introduce Hypothetical B. 26(f) Meet and Confer C. 16(b) Pre-trial Conference 3
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MARJORIE WEBSTER v. ROADRUNNER GORGEOUS METRO, INC. and ROADRUNNER GORGEOUS, INC. I. THE PARTIES Plaintiff Marjorie Webster ( Webster ) is a twenty-two year old senior at the University of Louisville. Her permanent address is in Frankfort, Kentucky. There are two defendants: (1) Roadrunner Gorgeous Metro, Inc., a Kentucky corporation with offices in Louisville, and (2) Roadrunner Gorgeous, Inc., a California corporation with offices in California. Roadrunner Gorgeous Metro, Inc. is a licensee of Roadrunner Gorgeous, Inc. and operates two Roadrunner Gorgeous Bar and Restaurants in the Louisville area. One of these is the site of the accident in issue. Roadrunner Gorgeous, Inc. is a holding company that, as the licensor, controls advertising and promotion for its licensees. Unless otherwise noted, the two defendants are referred to collectively as Roadrunner. II. THE ALLEGATIONS Webster filed a Complaint against Roadrunner on January 23, 2012, in the United States District Court for the Western District of Kentucky. Webster alleges that, on September 9, 2011, she and five University of Louisville friends were celebrating the start of their senior year at the Roadrunner Gorgeous Bar and Restaurant on W. Main Street in Louisville. While there, Webster and her friends were encouraged by bartenders and a hostess to climb on the bar and dance. This was a common occurrence at this establishment. Indeed, there are pictures on the walls at the bar where other patrons engaged in similar activity, known to the patrons as the Roadrunner Dance. It was also not the first time a possible inebriated patron was injured doing the Roadrunner Dance. In fact, about a year ago, there was an article in the Louisville Courier- Journal about someone injured doing the Roadrunner Dance at a bachelor party. The article mentioned that a lawsuit had been filed for injuries sustained on that occasion. The bar was wet and slippery. Webster, urged on by the employees, climbed on the bar so she could be photographed by her friends. While dancing, she fell and sustained serious neck and back injuries. After leaving the bar that night, Webster and her friends went to Harley s Main Street Tavern down the street for a few more drinks. The following day, before seeking medical treatment for her injuries, she and her friends went horseback riding. Webster and her friends sent text messages and took photos on her cell phone at Harley s and during the horseback riding trip. She and her friends posted some of those photos on their Facebook walls, and tweeted about the horseback riding. Her friends tagged Webster in the photos, so they appeared on her Facebook page, too. Neither Webster nor her friends preserved the photos and text messages on their cell phones, as they had limited storage space. 5
On September 12, two days after the horseback riding trip and three days after her visit to the Roadrunner Gorgeous Bar and Restaurant, Webster sought medical treatment for the neck and back injuries. She required several surgeries and, as a result, missed the first semester of her senior year. On January 23, Webster filed a complaint seeking compensatory and punitive damages from Roadrunner for the failure to maintain the bar in a safe condition. Both prior to and post filing, Webster communicated with her attorney from her home and work e-mail accounts. Roadrunner denied liability and asserted an affirmative defense based on Webster s comparative negligence. After receiving the Complaint, Roadrunner s in-house counsel sent a friend request through Facebook to one of Webster s friends present on the night she allegedly sustained her injuries at the bar. The in-house counsel sent a similar request to the presiding judge in the case. He did not disclose his relation in the pending case to either the judge or Webster s friend. III. THE MEET-AND-CONFER Due to an expedited schedule, the parties agree to hold their Rule 26(f) conference immediately before the Rule 16(b) conference. Any unresolved issues from the 26(f) will then be raised with the judge during the 16(b). Prior to the face-to-face 26(f), the parties conferred via teleconference and identified the following issues for discussion and resolution: (1) Disagreement as to when the defendants duties to preserve were triggered: Webster contends that Roadrunner s duty began on the date of the injury, September 9, 2011. Roadrunner Gorgeous Metro, Inc. contends that its trigger was receipt on December 1, 2011, of a demand letter from Webster s attorney. Roadrunner Gorgeous, Inc., argues that its trigger was receipt of an identical demand letter on December 2, 2011. By December, any potentially relevant video captured on surveillance cameras at the bar had been deleted in the normal course of business. (2) Disagreement as to when plaintiffs preservation duty arose. Webster argues that her duty arose only as of her initial meeting with her attorney on November 28, 2011. By that time, she had destroyed or lost photos and texts from her cell phone and e-mail in her work and personal accounts. (3) Disagreement about scope of discovery: Roadrunner wants Webster to stipulate to the production of any images or statements from the Facebook accounts of Webster and her friends, as well as cell phone tower logs. Roadrunner retained a technical consultant to advise them on the collection and identification of relevant records from these social media sites. Webster argues that (a) the content of her Facebook account and cell records are not within her possession, custody, or control, (b) the Stored Communications Act bars production, (c) the request is overbroad and (d) the request is an invasion of her privacy. 6
(4) Disagreement on privilege issues: Roadrunner plans to issue a Rule 45 subpoena to Webster s employer for all e-mail between Webster and her attorney. Webster claims these are privileged but Roadrunner claims privilege was waived by using the work e-mail account when company policy, available on the company website, clearly states there is no expectation of privacy in company e-mail. (5) Inadvertent production: Roadrunner made initial disclosures and inadvertently produced privileged documents prior to the parties entering a FRE 502 order. Roadrunner asserts the production was inadvertent. Webster asserts production was the result of Roadrunner s insufficient supervision of its vendor and, therefore, it waived its right to claim privilege for these documents. Webster s position is based on the results of having mined the metadata of the documents in question, which disclosed a hidden comment from an associate at Roadrunner s counsel describing the lack of supervision. (6) Disagreement about certain discovery that Webster will seek: Webster wants Roadrunner to agree that she may notice a 30(b)(6) deposition to determine (a) what Roadrunner posts on its website, on its Facebook page, and on YouTube, about women who dance on Roadrunner s bars, (b) how Roadrunner manages its Internet presence, (c) how Roadrunner manages images sent to it by patrons and (d) what records retention schedules, if any, apply to images on Roadrunner s Facebook account, on YouTube, and on its website. To assist in addressing this disagreement, Roadrunner s technical consultant will attend the meet and confer and 16(b) conference. IV. THE 16(b) CONFERENCE The attorneys will appear before the assigned magistrate judge for the Rule 16(b) conference and will argue all unresolved issues. 7
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FEDERAL CIRCUIT MODEL E-DISCOVERY ORDER FOR PATENT LITIGATION Jennifer Fiorentino and Monte Cooper Reprinted with permission from Orrick ediscovery/intellectual Property Alert, October 11, 2011. On September 27, 2011, Chief Judge Randall R. Rader of the United States Court of Appeals for the Federal Circuit introduced a Model Order on E-Discovery in Patent Cases at the Eastern District of Texas Judicial Conference. While the proposed Model order does not carry the weight of law, it does represent a positive trend in limiting the scope of overbroad and burdensome electronic discovery requests. In his speech introducing the Order, Judge Rader stated that cost is the greatest weakness of the U.S. court system and discovery excesses are a driving factor. 1 He recognized patent cases, in particular, tend to suffer from disproportionally high discovery expenses. 2 To address this problem, the Advisory Council of the Federal Circuit drafted and adopted the Model Order to guide district court judges and magistrates toward limiting electronic discovery in patent cases. Similar to the Federal Rule of Civil Procedure (FRCP) 30, which limits the number of depositions a party can take during litigation, the Model Order proposes to presumptively limit the scope of electronic document requests and streamline production. For example, it limits the number of custodians and search terms for e-mail document requests. The parties may modify the scope upon agreement, but they must do so at their own expense. The requesting party would pay for additional productions beyond the scope of the Order or as granted by the Court. Specifically, the Model Order provides: Exchange of core documentation: The parties begin by exchanging initial disclosures and documents concerning the patents at issue, the prior art, the accused instrumentalities and relevant finances. 3 E-Mail: After the initial exchange of core documentation, the parties may request limited e-mail discovery focused on specific issues. o o Each request shall name the custodian, search terms and date range. The parties must cooperate to identify the proper scope. Each requesting party shall limit the scope to five (5) custodians per producing party and five (5) narrowly tailored search terms per custodian. 1 Chief Judge Randall R. Rader, United States Court of Appeals for the Federal Circuit, The State of Patent Litigation, E.D. Texas Judicial Conference, at 7 (Sept. 27, 2011). 2 Id. 3 See E-Discovery Committee of the Advisory Council of the Federal Circuit, An E-Discovery Model Order, at 2 (explaining that the most relevant discovery in patent cases centers on the patents themselves, how they work, the prior art and related financials versus the mass e-mail searches and productions which often result in tangential and less relevant evidence). 9
Cost-shifting The parties can agree to expand the scope of custodians, but the requesting party pays at its own expense for this information. The Court may shift costs for disproportionate ESI requests pursuant to FRCP 26 or any dilatory discovery tactics. The Court will also consider a party s compliance with the Order and its efforts to cooperate and contain costs. Metadata The production shall not include metadata, except for the date and time a document was sent or received and the distribution list. Privilege The inadvertent production of attorney-client communication or work product protected ESI will not be a waiver in the pending case or any other proceeding following Federal Rule of Evidence (FRE) 502(d). If adopted, the Order will serve as a starting point for parties in patent cases to exchange the most relevant information concerning the patents at issue in a proportional and cooperative manner, and could result in substantial cost savings. 10
INFORMATION MANAGEMENT CONSIDERATIONS DURING CORPORATE REORGANIZATION RECOGNIZING AND AVOIDING COMMON PITFALLS Wendy Butler Curtis, Patricia Alberts and Leigh Isaacs Reprinted with permission from Orrick ediscovery Alert, May 18, 2011. Introduction Following a thoughtful Records and Information Management ( RIM ) program is an important mandate for any company, applicable from the point of corporate inception throughout the organizational evolution, including during mergers, acquisitions, divestitures and potential dissolution (collectively, reorganization ). As recognized in a pair of recent sanctions decisions out of the Federal Circuit, the purpose of this good housekeeping practice is to simply limit the volume of files and retain only that which is of continuing value. 1 It is a costly mistake to remain ignorant of both the efficiencies to be gained, and the risks to be avoided, by paying proper attention to your RIM program, especially during a corporate reorganization. While a successful, defensible RIM program takes into consideration cultural aspects of the organization it governs, certain key elements should always be present. Key components include: Documentation and training related to the company s record retention policies, e- mail policies, social networking policies, operational procedures and departmental schedules. Lifecycle management policies and procedures addressing, among other things, information governance, preservation and the secure disposition of data. Best practices that cover operational efficiencies such as an annual review of off-site storage vendor contracts, regular audits of technology functionality, and backup media rotation and disposition cycles that ensure that these media are not over-retained and are used solely for disaster recovery purposes. (This is an area particularly ripe for scrutiny during due diligence efforts in the event of reorganization.) This alert offers advice on how to steer clear of common pitfalls during a corporate reorganization and provides tips on how to navigate the process to maximize the value of your information while preparing for a post-reorganization world. Create a RIM Program It is never too late or too early to implement a RIM program. The resources you spend on its design and deployment will be quickly eclipsed by the benefits you reap if done properly. The measure of a successful RIM program is its ability to be operationalized at a cost proportional to the risk it seems to minimize, while supporting your business with 1 Micron Technology, Inc. v. Rambus, Inc., No. 2009-1263, 2011 U.S. App. LEXIS 9730, *22 (Fed. Cir. May 13, 2011). 11
minimum disruption and improved efficiency. Indicators of a well-designed RIM program include a yes answer to the following questions: Is the over-arching policy accessible and easy to understand by the affected employees? Were retention schedules devised in a manner to balance risk against cost? Is the program simple enough to be easily implemented and audited? Is record disposition handled in the ordinary course of business, automated where possible and deployed in a secure manner so as to meet privacy and other regulatory requirements? Identifying challenges The list below identifies some of the more common challenges encountered by organizations during reorganization or dissolution and offers some advice on how to address them: Time constraints. Quickly mobilizing to facilitate a due diligence exercise involves a significant amount of coordination and a reliable communications network. Identify one or two record-savvy managers (in the IT and/or records department(s), ideally) to be responsible for the project and make one of them the single point of contact for the due diligence team. A preexisting RIM program that anticipates a due diligence scenario significantly increases the efficiency of the exercise. Not always a records person on the other end. It is helpful to have dedicated records personnel on both sides of the deal, but that is often not the case. Creativity in finding knowledgeable contacts may be necessary to get the information you need. This is especially important as you formulate a plan to minimize business disruption during the integration of the records and IT systems. International concerns. If foreign offices play a role in the deal, there may be privacy law issues related to any foreign data sought during the due diligence exercise. Consult your privacy officer or outside counsel to flag potential issues prior to commencing due diligence. Post-reorganization companies may need specific contracts to facilitate records transfers between domestic and international offices. 2 2 Due to the European Union s comparatively strong privacy laws, E.U. Model Contract Clauses and other procedures may be needed to assist in the transfer of information between entities in Europe and the United States. See E.U. Directorate-General for Justice, Model Contracts for the Transfer of Personal Data to Third Countries, available at http://ec.europa.eu/justice/policies/ privacy/modelcontracts/index_en.htm (discussing Model Contracts and presenting standard clauses for incorporation into contracts involving transfer of data to third countries). 12
Ownership and access to records. Most information is owned by various groups within the business. Overcoming security and privacy concerns during the integration of records and IT systems requires knowledge of the corporate culture and an understanding of applicable legislative and regulatory requirements. Involve the respective Chief Information Officers or other technology managers early in the process. Electronic documents. There are no common IT standards with respect to computers, servers, e-mail systems, office suites, backup systems and other software. Documents can exist in multiple formats and on a variety of systems. Media and format obsolescence should be addressed, as some data may become difficult to read and use in the future. If you anticipate tensions between merging departments, consider hiring an independent consultant to provide an outsider s perspective on the best approach to post-reorganization records management. Data disposition. Old data is expensive to maintain and can be a liability to either or both of the parties to a deal. As your company goes through reorganization and is taking stock of its data inventories, it may be a convenient time to dispose of unnecessary backup tapes and legacy data. 3 Retention schedules. Anticipate competing records-retention policies and schedules. It is important to decide whether to merge programs, continue to have separate practices or to start with an entirely new program. Counsel can help you devise and implement a program appropriate for the reorganized entity. Reduction in resources. After the deal is done, finding the right personnel to answer questions related to records and technology can be difficult. Address this challenge early. While a transition team is essential, identify a contact person who will be available when unanticipated questions arise later, especially in the context of litigation. Consider executing a retainer or consulting agreement with key personnel before they leave the company. Pending or active litigation. When designing a RIM program your company must factor in the impact of retention mandates on current and future litigation. Though courts understand that most document retention policies are adopted with benign business purposes, reflecting the fact that litigation is an everpresent possibility in American life, 4 there will be severe consequences for the party whose policies are designed explicitly to further a company s litigation 3 As many companies learn the hard way, failure to dispose of unneeded information may also result in significant discovery costs and can be a liability in the event of litigation. 4 Rambus, 2011 U.S. App. LEXIS 9730 at *22 (upholding sanctions against Defendant for destroying relevant documents pursuant to a retention policy strategically designed to eliminate potentially harmful documents and with the self-stated purpose of making defendant battle ready ) (citing Nat l Union Fire Ins. Co. of Pittsburgh, Pa. v. Murray Sheet Metal Co., Inc., 967 F.2d 980, 984 (4 th Cir. 1992)). 13
strategy by frustrating the fact-finding efforts of parties adverse to [it]. 5 The most defensible retention policies are those that enable the destruction of documents on a regular schedule and are motivated by general business needs, which may include a general concern for the possibility of litigation. 6 Due Diligence Cindy Warner, of PricewaterhouseCoopers CIO Advisory Services group, observes that [r]ecords management and IT have frequently been step-children to the due diligence process but are major contributors to the ultimate success or failure of those endeavors. Valuations are key and records and information management plays a critical role in determining how effectively the merged organization is able to integrate information and skills. A thoughtful RIM program will help you prepare for a productive due diligence exercise and will also help you identify and preserve relevant information created as a result. 7 RIM program protocols should include instructions relating to: the review of the entities respective records-retention schedules; access to any off-site storage vendor facilities or hosted applications; identification of any password-protected or encrypted data; and the migration and integration processes for electronic documents and other data. Include a checklist of the following tasks as part of your RIM program materials: Establish a formal relationship between RIM program facilitators and the M&A due diligence teams. Set up communications methods between RIM program facilitators and the M&A due diligence teams, and between program facilitators on both sides of the deal. Get a list of records each party will produce. (A list may be found in the acquisition or merger agreement or other business documentation.) 5 Id. 6 Id. 7 The following non-inclusive list of documents have a high likelihood of becoming relevant to litigation resulting from the deal: documents used in preparation of the background section of any proxy or recommendation statement; board of directors materials (including both those maintained by the company and those maintained personally by the directors); offers and responses; and communications with, and among, all relevant witnesses. 14