1. Federal and State Courts Issued Decisions Approving the Use of “Computer-Assisted Review” AKA “Predictive Coding” or “Technology-Assisted Review.”
Last year, numerous e-discovery commentators and vendors published articles and on-line resources and held seminars explaining how “computer-assisted review” (also known as “predictive coding” or “technology-assisted review”) works and discussing the expected benefits of using computer-assisted review. EDRM, which previously published the Electronic Discovery Reference Model depicting the various stages of the e-discovery process, published a draft reference model describing the process of computer-assisted review. The draft model defined computer-assisted review as a “process of having computer software electronically classify documents based on input from expert reviewers, in an effort to expedite the organization and prioritization of the document collection.” The major steps in the process according to EDRM are: setting outcome goals; setting the protocol for training the software; educating the human reviewers; coding documents by human reviewers; predicting results by the software applying the coding decisions; testing results through statistical sampling; evaluating results and repeating the process if necessary; and achieving the goals of the review. Additionally, The Grossman-Cormack Glossary of Technology Assisted Review was published. The glossary attempts to provide “a common framework and set of definitions for use by the bar, the bench, and service providers.”
A study from the RAND Corporation grouped the costs associated with e-discovery into three main categories: collection (8% of costs); processing (19% of costs); and review (73% of costs). Based on its study, RAND believed that companies could lower the cost of large document review projects by using computer-assisted review to reduce the number of documents requiring human review.
With all the discussion surrounding computer-assisted review, U.S. Magistrate Judge Andrew J. Peck became the first judge to issue an opinion that approved the use of that process to find and produce relevant electronically stored information (ESI) during discovery. In Monique Da Silva Moore v. Publicis Groupe & MSL Group, ___ F.R.D. ___, 2012 WL 607412 (S.D.N.Y. Feb. 24, 2012), Magistrate Judge Peck recognized that “computer-assisted review is not perfect” but encouraged counsel to consider using this technology to search for relevant ESI in appropriate cases: “What the Bar should take away from this Opinion is that computer-assisted review is an available tool and should be seriously considered for use in large-data-volume cases where it may save the producing party (or both parties) significant amounts of legal fees in document review.” Id. at *12.
Not long after Magistrate Judge Peck’s decision, a Virginia state court allowed the defendants “to proceed with the use of predictive coding for purposes of the processing and production” of ESI. In Global Aerospace Inc. v. Landow Aviation, L.P., No. CL 61040 (Va. Cir. Ct. Apr. 23, 2012), the defendants estimated they had 250 gigabytes of reviewable ESI from their computer systems, which could easily equate to more than two million documents. According to the defendants, a linear manual document review would take 20,000 man hours, cost $2 million, and locate only 60% of the potentially relevant documents. Keyword searching could be more cost-effective, but it may retrieve only 20% of the potentially relevant documents. Defendants believed that predictive coding, however, could be done in less time for less money and could retrieve upwards of 75% of the potentially relevant documents. (It has been reported recently that the defendants have completed the predictive coding process and that the plaintiff has not objected to the results.)
In a twist on what happened in the Global Aerospace case, it was the plaintiffs that sought to compel the defendants to use a form of predictive coding instead of keyword searching in an antitrust lawsuit pending in the Northern District of Illinois. In Kleen Products LLC v. Packaging Corp. of America, No. 10-5711, 2012 WL 4498465 (N.D. Ill. Sep. 28, 2012), after the defendants had already begun producing documents, the plaintiffs argued that the defendants’ search methodology was likely to find less than 25% of responsive documents but that the plaintiffs’ proposed “content-based advance analytics search” would find more than 70% of responsive documents at no greater cost. According to the plaintiffs, their proposed search methodology would provide more accurate results than Boolean keyword searches because it would identify relevant concepts out of the documents instead of focusing on matching words. U.S. Magistrate Judge Nan R. Nolan conducted two full days of evidentiary hearings regarding the parties’ positions. Magistrate Judge Nolan observed at the end of the second day that “[r]esponding parties are best situated to evaluate the processes, methodologies, and techniques appropriate for preserving and producing their own” ESI. 2012 WL 4498465, at *5 (citing The Sedona Conference, The Sedona Conference Best Practices Commentary on the Use of Search and Information Retrieval Methods in E-Discovery, 8 Sedona Conf. J. 189, 193 (Fall 2007)), and she urged the parties to find a middle ground that would provide reasonable assurance to the plaintiffs that they were receiving a high percentage of responsive documents without completely scrapping the defendants’ search methodology. Kleen Products, 2012 WL 4498465, at *5. After months of subsequent status conferences, the plaintiffs withdrew their demand and agreed that they would not argue that the defendants should use the plaintiffs’ proposed methodology for any document requests served before October 1, 2013. The parties agreed to meet and confer regarding an appropriate search methodology to respond to future document requests.
In In re Actos (Pioglitazone) Products Liability, MDL No. 11-2299 (W.D. La.), the parties in multi-district litigation pending in the Western District of Louisiana agreed to a protocol for a “Search Methodology Proof of Concept” to test predictive coding as a possible method for the search and production of relevant ESI collected from one of the parties. The protocol set forth a series of detailed steps and quality controls designed to train the predictive coding software on a smaller subset of the party’s ESI with the goal of eliminating the need to manually review documents below an agreed-upon relevancy score. Each side agreed to have three individuals work collaboratively as “experts” to train the software. The protocol built in numerous meet-and-confer checkpoints throughout the process, including at the end of the process where the parties were to meet and confer about finalizing the method for searching documents on a going forward basis.
Finally, the Delaware Court of Chancery took a different approach and sua sponte ordered the parties to use predictive coding even though neither party asked to use it. The court stated: “This seems to me to be an ideal non-expedited case in which the parties would benefit from using predictive coding. I would like you all, if you do not want to use predictive coding, to show cause why this is not a case where predictive coding is the way to go.” EORHB, Inc. v. HOA Holdings, LLC, No. 7409 (Del. Ch. Oct. 15, 2012). “[I]nstead of burning lots of hours with people reviewing, it seems to me this is the type of non-expedited case where we could all benefit from some new technology use.” The court also ordered the parties to agree to use the same e-discovery vendor to house their documents, stating, “If you cannot agree on a suitable discovery vendor, you can submit names to me and I will pick one for you.”
2. The American Bar Association Passed New Model Ethics Rules Regarding Technology.
While many lawyers and judges were learning about computer-assisted review last year, the American Bar Association announced changes to its Model Rules of Professional Conduct to address the impact of technology on the practice of law. A new comment to Model Rule 1.1, which defines a lawyer’s duty of competence, now makes clear that lawyers have an obligation to have a basic understanding of relevant technology: “To maintain the requisite knowledge and skill, a lawyer should keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology, engage in continuing study and education and comply with all continuing legal education requirements to which the lawyer is subject.” Another new comment to Model Rule 1.1 lists the factors that lawyers should consider before retaining or contracting with other lawyers outside their own firm, including: the education, experience, and reputation of the nonfirm lawyers; the nature of the services to be performed; and the legal protections, professional conduct rules, and ethical environments of the jurisdictions in which the services will be performed, particularly relating to confidential information. Together, these changes will likely impact how lawyers plan for and manage large document review projects. Lawyers will need to stay current with available search and review technologies (e.g., predictive coding, near duplication, email threading, etc.), and closely analyze alternative staffing models such as using contract attorney located outside the United States.
Model Rule 4.4, which addresses the rights of third persons, now expressly includes ESI within the scope of a lawyer’s obligation to notify the sender of documents mistakenly sent or produced by opposing parties or their lawyers. The commentary states that the receipt of metadata in electronic documents creates an obligation only if the receiving lawyer knows or reasonably should know that the metadata was inadvertently sent.
Model Rule 1.6(c), which addresses client confidentiality, now requires lawyers to “make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client.” This new subsection may result in the use of more clawback agreements and non-waiver orders pursuant to Federal Rule of Evidence 502(d) to protect against the inadvertent production of privileged information.
3. Federal Courts Provided More Guidance on the Scope of Social Media Discovery.
“Although the law regarding the scope of discovery of electronically stored information (“ESI”) is still unsettled, there is no dispute that social media information may be a source of relevant information that is discoverable.” Reid v. Ingerman Smith LLP, No. 2012-0307, 2012 WL 6720752, at *1 (E.D.N.Y. Dec. 27, 2012). Consistent with that observation, there were a number of federal court decisions last year that ordered the production of social networking information and provided guidance on the scope of social media discovery. These decisions show that federal courts are becoming more familiar with social networking technology and are becoming more comfortable with applying general discovery principles to solve new problems presented by social media. In Mailhoit v. Home Depot U.S.A., Inc., 285 F.R.D. 566 (C.D. Cal. 2012), for example, the court held that discovery of content from social media sites requires the application of basic discovery principles such as relevancy and proportionality. It also requires that document requests describe the information to be produced with “reasonable particularity.” In Robinson v. Jones Lang LaSalle Americas, Inc., No. 12-00127, 2012 WL 3763545, at *1 (D. Or. Aug. 29, 2012), the court viewed social media as just another form of ESI and saw “no principled reason to articulate different standards for the discoverability of communications through email, text message, or social media platforms.” The court then applied the same relevancy standards set forth in Federal Civil Rule 26(b)(1) that apply to other documents and ESI, and indicated that courts have the discretion to limit the scope of social media discovery through discovery principles such as proportionality.
Applying these principles, federal courts generally are finding that information posted to social media sites is discoverable if it is relevant to the parties’ claims and defenses in the lawsuit, but that requesting parties are not necessarily entitled to obtain every piece of information posted by a party on those sites. In Anthony v. Atlantic Grp., Inc., Nos. 09-2383, 2942, 2012 WL 4009490 (D.S.C. Sep. 12, 2012), the court applied Federal Civil Rule 26(b)(1), and ordered the plaintiffs to produce social networking information responsive to the defendant’s document requests because it was relevant to the issues in the case. In Howell v. The Buckeye Ranch, No. 11-1014, 2012 WL 5265170 (S. D. Ohio Oct. 1, 2012), the court ruled that relevant information in the private section of a plaintiff’s social media account was discoverable, that this information was not privileged or protected from discovery by a common law right of privacy, and that the plaintiff had a duty to preserve all the relevant information in her social media accounts. However, the court denied a motion to compel the plaintiff to give the defendants her user names and passwords for each of the social media sites she used, stating that “a litigant has no right to serve overbroad discovery requests that seek irrelevant information.” Id. at *1. Likewise, in Tomkins v. Detroit Metropolitan Airport, 278 F.R.D. 387, 388 (E.D. Mich. 2012), the court denied the defendant’s motion to compel the plaintiff to provide it access to her entire Facebook account. According to the court, the defendant did “not have a generalized right to rummage at will through information that Plaintiff has limited from public view.” Otherwise, the defendant “would be allowed to engage in the proverbial fishing expedition, in the hope that there might be something of relevance in the Plaintiff’s Facebook account.” Id. The court reached the same conclusion in Davids v. Novartis Pharm. Corp., No. 06-0431 (E.D.N.Y. Feb. 24, 2012), and denied the defendant’s motion to compel the plaintiff to turn over her user name and password for her Facebook account.
However, in E.E.O.C. v. Original Honeybaked Ham Co. of Georgia, Inc., No. 11-02560, 2012 WL 5430974 (D. Colo. Nov. 7, 2012), the court ordered the class members to provide to a special master all information necessary to access any social media websites used by such members from January 1, 2009 through the present as well as all information necessary to access any email account, web blog account, or similar accounts used for communicating or posting communications or pictures during that time period. The court also ordered the production of any cell phones used to send text message during that time period. Moreover, in Thompson v. Autoliv ASP, Inc., No. 09-1375, 2012 WL 2342928 (D. Nev. June 20, 2012), the court outlined a process under which the plaintiff would upload onto an electronic storage device all the information from her Facebook and MySpace accounts and produce the device to the defendant’s counsel, defendant’s counsel would identify the information believed discoverable, plaintiff’s counsel would object and counsel for both parties would seek to reach an agreement on what was discoverable, and the court would resolve any disputes between the parties and rule on what information should be produced in the case. After this process, the defendant’s counsel would return the device and could not retain any social media information that was not agreed or ordered to be produced.
As more discovery disputes arise relating to the spoliation, format, and relevance of social networking information, federal courts likely will continue to expand the growing body of case law on social media discovery.
4. E-Discovery Costs Allocated Before Class Certification.
In Boeynaems v. LA Fitness, 285 F.R.D. 331 (E.D. Pa. 2012), the court decided to allocate e-discovery costs in a putative class action. After producing a significant amount of discovery at its own cost, the defendant objected to the plaintiffs’ new demand for additional documents. The court ruled that “where (1) class certification is pending, and (2) the plaintiffs have asked for very extensive discovery, compliance with which will be very expensive, that absent compelling equitable circumstances to the contrary, the plaintiffs should pay for the discovery they seek.” Id. at 341. Through its ruling, the court created a presumption that the requesting party should bear the expenses of the responding party to comply with the discovery requests. Ordinarily, the presumption is that the responding party should bear its own expenses.
The court was “firmly of the view that discovery burdens should not force either party to succumb to a settlement that is based on the cost of litigation rather than the merits of the case.” Id. at 342. Accordingly, the court ordered that the plaintiffs would have to decide whether they wanted to pay for all the defendants’ internal costs for responding to the document requests, including “the appropriately allocated salaries of individuals employed by Defendant who participate in supplying the information which Plaintiffs request, including managers, in-house counsel, paralegals, computer technicians and other involved in the retrieval and production of Defendant’s ESI.” In ordering this, the court maintained that economic motivation and fairness are relevant factors in determining cost shifting and that it had the power to allocate the cost of discovery where the cost of producing documents is very significant or where the burden or expense of the proposed discovery outweighs its likely benefit.
In Fleisher v. Phoenix Life Ins. Co., No. 11-8405, 2012 WL 6732905 (S.D.N.Y. Dec. 27, 2012), the court declined to adopt the cost-shifting presumption created in Boeynaems, stating that it ran counter to the relevant principle announced by the Supreme Court: “Under [the discovery] rules, the presumption is that the responding party must bear the expense of complying with discovery requests[.]” Id. at *4 (quoting Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 358 (1978)). Instead, the court applied the seven-factor test set forth by Judge Scheindlin in Zubulake v. UBS Warburg LLC, 217 F.R.D. 309 (S.D.N.Y. 2003), and concluded that cost-shifting was not appropriate under the circumstances.
In another case that resulted in the allocation of e-discovery costs, the court ordered the parties to each bear one-half of the expenses associated with the defendant’s production of additional documents. See Lubber Inc. v. Optari, LLC, 11-0042, 2012 WL 899631 (M.D. Tenn. Mar. 15, 2012). The court observed that “[o]ne of the concerns of discovery is the allocation of costs. In general, costs are borne by the producing party. While this works in the vast majority of cases, the requesting parties have little incentive not to ask for everything possible.” Id. at 2. In ordering the parties to split the costs of the production equally, the court stated that in its experience “where the requesting party bears a part of the cost of producing what they request, the amount of material requested drops significantly. When a party has to contemplate whether the last possible bit of information will cost them more than it is worth, they quit asking for items of marginal relevance.” Id. The court based its ruling on the principle of proportionality found in Federal Civil Rule 26(b)(2)(C)(iii), which the court stated “gives [it] a great deal of latitude in controlling discovery which sometimes tends to run amok.” Id.
While the courts above considered cost-shifting during a case, the Third Circuit Court of Appeals ended the recent trend of federal courts awarding e-discovery costs to “prevailing parties” at the end of a case pursuant to 28 U.S.C. § 1920(4). In Race Tires Amer., Inc. v. Hoosier Racing Tire, Corp., 674 F.3d 158, 159 (3d Cir. 2012), the Third Circuit held that the charges imposed by e-discovery vendors to assist in the collection, processing, and production of ESI were not taxable against a losing party as “[f]ees for exemplification [or] the costs of making copies of any materials where the copies are necessarily obtained for use in the case.” According to the Third Circuit, “Neither the language of § 1920(4), nor its history, suggests that Congress intended to shift all the expenses of a particular form of discovery — production of ESI — to the losing party.” Id. at 171. Accordingly, the Third Circuit held that the scope of costs recoverable under § 1920(4) was limited to scanning and file format conversion and reduced the district court’s award of more than $365,000 in e-discovery costs to approximately $30,000.
5. Amendments to the Federal Civil Discovery Rules May Be Coming to Address the Costs and Burdens of E-Discovery.
While litigants have been looking for ways to reduce or shift their e-discovery costs, the U.S. Judicial Conference’s Advisory Committee on Rules of Civil Procedure (Civil Rules Advisory Committee) has been looking at different approaches to address concerns about the costs and burdens of preservation obligations since 2010. In November 2012, the Civil Rules Advisory Committee’s work resulted in a recommendation for a replacement version of Federal Civil Rule 37(e) that would govern a party’s failure to preserve discoverable information. Although the proposed new version of Rule 37(e) would not establish specific guidelines regarding the timing and scope of litigation holds, it would address the types of sanctions a court could impose for a party’s failure to preserve ESI and the factors that a court should consider in determining whether a party should have preserved such information.
The proposed rule would limit the most serious sanctions for failing to preserve discoverable information (e.g., dismissal, striking of claims and defenses, adverse-inference jury instructions, etc.) to instances where the failure was willful or in bad faith and caused substantial prejudice in the litigation, or where the failure “irreparably deprived a party of any meaningful opportunity to present a claim or defense.” The factors for determining whether information should have been preserved and whether the failure was willful or in bad faith would include the extent to which the party was on notice that litigation was likely and that the information would be discoverable, the reasonableness of the party’s efforts to preserve information, whether the party received a request to preserve information and the reasonableness of the request, the proportionality of the preservation efforts to any anticipated or ongoing litigation, and whether the party sought timely guidance from the court regarding any disputes concerning preservation. The rationale behind the proposed rule is that a sanction-based approach will help litigants because it will provide a uniform standard for imposing sanctions and the most serious sanctions could not be imposed if the party who lost information acted reasonably. The publication of the rule for comment would not happen until August 2013.
The Discovery Subcommittee of the Civil Rules Advisory Committee also is looking at another change to the Federal Civil Rules to address the costs and burdens of e-discovery. This change to Federal Civil Rule 26(b)(1) would expressly build the concept of proportionality into the scope of what is discoverable by limiting the scope of discovery to any nonprivileged matter that is relevant to any party’s claim or defense and “proportional to the needs of the case considering the amount in controversy, the importance of the issues at stake in the action, the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.”
6. The Seventh Circuit Completed Phase Two of Its E-Discovery Pilot Program.
Contributing to the discussion about how e-discovery concerns can be addressed and what rule reforms may be needed, the Seventh Circuit issued the Final Report on Phase Two of its E-Discovery Pilot Program. Phase Two of the Pilot Program ran from May 2010 through May 2012 and included 40 judges and over 700 attorneys participating in 296 cases in which Pilot Program Principles were tested. The Pilot Program Principles address such topics as cooperation, proportionality, preservation, and production format as well as other e-discovery issues. For example, Principle 1.03 states that the “proportionality standard set forth in Fed. R. Civ. P. 26(b)(2)(C) should be applied in each case when formulating a discovery plan. To further the application of the proportionality standard in discovery, requests for production of ESI and related responses should be reasonably targeted, clear, and as specific as practicable.” The Principles also call for the use of “e-discovery liaisons” who can discuss technology issues that arise in discovery disputes. One of the purposes of the Principles is to reduce the costs and burdens of e-discovery while maintaining fairness to all parties. During Phase Two, a number of e-discovery experts from across the country joined as committee members or advisors to the Pilot Program, and a number of subcommittees were formed, including the Criminal Discovery, Technology, and Web Site (www.DiscoveryPilot.com) Subcommittees.
The Pilot Program Committee also conducted an extensive survey of judges and attorneys who participated in the Program during Phase Two. Based on responses from participating attorneys, it is interesting to note that only 3% of responding attorneys reported that the Principles decreased or greatly decreased their ability to zealously represent their clients. Although the Principles did not appear to cut costs overall, a large percentage of responding attorneys and judges did report that the Principles increased the fairness of the e-discovery process, increased cooperation among counsel, and decreased the number of discovery disputes brought to the court’s attention. In sum, “[t]he bottom line is that the Principles are perceived to result in more cooperation, more access to needed information and more fairness.”
During Phase Three of the Pilot Program, which began in May 2012, the Committee will continue to work to improve the e-discovery process to meet its goals of cutting costs, improving efficiency, and providing fairness to all parties. The Committee also will continue to explore the creation of an E-Mediation Program to provide free mediation of e-discovery disputes to parties involved in Pilot Program cases.
The Seventh Circuit’s Pilot Program is part of the continuing trend of federal district courts implementing local rules, pilot projects, model orders, or guidelines to address e-discovery issues. For example, the Northern District of California adopted new e-discovery guidelines last year that included an ESI checklist for use during the Federal Civil Rule 26(f) meet-and-confer process and a model stipulated order regarding the discoverability of ESI. The Western District of Washington adopted new local rules that require the parties to consider adopting a Model Agreement Regarding Discovery of Electronically Stored Information in Civil Litigation, or a modified version of it. The Model Agreement includes general principles and addresses ESI disclosures, preservation of ESI, privilege, and discovery procedures such as search methodology, format, de-duplication, and metadata fields. If the parties do not agree to adopt the Model Agreement, they still need to address these topics during their meet and confer and during the initial status conference with the court. Also in 2012, the Eastern District of Texas issued a modified version of the Federal Circuit’s Model Order Regarding E-Discovery in Patent Cases.
7. Pennsylvania and Florida Passed E-Discovery Amendments to Their Civil Rules.
In addition to local rulemaking activity in the federal courts, state courts continue to pass new e-discovery rules. In 2012, Florida passed amendments to its Rules of Civil Procedure that generally track the Federal Rules of Civil Procedure but provide more guidance to parties for addressing the costs and burdens of e-discovery. For example, in complex litigation and other cases in which the trial court holds a case management conference, the new rules state that the parties should discuss the extent to which they need to preserve ESI and whether they should conduct the discovery of ESI in phases or limit it to particular individuals, time periods, or sources.
Unlike Florida and many other states that generally follow the Federal Civil Rules, Pennsylvania’s Civil Procedural Rules Committee expressly stated that “there [was] no intent to incorporate the federal jurisprudence surrounding the discovery” of ESI when Pennsylvania amended its civil procedural rules last year to address e-discovery. According to the Committee, “the treatment of such issues is to be determined by traditional principles of proportionality under Pennsylvania law[.]” The Committee further stated that the proportionality standard governed the discovery of ESI so that “discovery obligations are consistent with the just, speedy and inexpensive determination and resolution of litigation disputes.” In addition to Florida and Pennsylvania, an amendment to Oregon’s Rules of Civil Procedure took effect last year that now expressly permits a request for the production of ESI and also provides that such a request may specify the form in which ESI should be produced.
In addition to statewide e-discovery rules, local courts and special docket courts also have passed their own e-discovery rules or pilot programs. For example, the Delaware Court of Chancery announced updates to its guidelines for the discovery of ESI and changes to its rules “to account for modern discovery demands.” The updated guidelines explain the court’s expectations regarding meet and confers about ESI issues and the collection and review of ESI during discovery. Similarly, the Cuyahoga County Court of Common Pleas, which is located in Cleveland, Ohio, passed a new local rule that sets out basic e-discovery principles for the parties and the court and is intended to encourage parties to meet and confer and reach agreement on ESI issues. Among other things, the new local rule covers the preservation of ESI, the protection of privileges, and production of ESI.
The prevalence of local e-discovery procedures in federal and state courts means that the venue of a case continues to play an important role in how e-discovery is conducted during the case. It also is another reason why litigants should begin considering e-discovery issues sooner rather than later, as they may have unexpected discovery obligations simply based on local practice requirements.
8. E-Discovery Tools Added to Google Apps for Business.
Google Apps for Business added new features for data archiving, retention policies, and litigation holds of email and instant messaging through an e-discovery service called Google Apps Vault (Vault). Google claims that Vault can reduce e-discovery costs by providing a way to manage and preserve business information generated or transmitted within Google Apps. According to Google, Vault allows business customers to set retention rules based on message content, sent date, recipient, or sender; notify users of litigation holds and track acknowledgements for specific matters; and export search results.
The introduction of Vault illustrates the impact of e-discovery on cloud computing. As more businesses move more internal functions to cloud-based software-as-a-service (SaaS) offerings like Google Apps, there will be a greater awareness of the need to consider how e-discovery obligations will be handled in the cloud and a greater demand for tools that meet those obligations. For example, businesses that are looking to move all their email from internal servers to a public cloud environment (e.g., Gmail) need to make sure they have a plan of action for maintaining the security and integrity of their emails, including metadata; preserving their emails when litigation arises; collecting potentially relevant emails efficiently and thoroughly; complying with any foreign privacy law restrictions depending on where the emails are physically located; and reviewing and producing the emails cost-effectively. SaaS offerings that make these issues easier to address or include built-in tools that are robust enough to be used as part of internal investigations or in litigation likely will have an advantage over other SaaS offerings.
9. A New York State Court Ordered Twitter to Produce A Criminal Defendant’s Tweets.
A New York criminal action raised questions of digital ownership and privacy rights in the context of e-discovery. In People of the State of New York v. Harris, the New York County District Attorney’s Office served a subpoena duces tecum on Twitter seeking user information, including email address and tweets posted for the Twitter account @destructuremal. The District Attorney’s office believed that a criminal defendant had used this Twitter account and that prosecutors could use the tweets from this account as evidence to contradict his defense to a disorderly conduct charge during an Occupy Wall Street protest.
The court denied the defendant’s motion to quash the subpoena, holding that the defendant did not have standing. “Here, the defendant has no proprietary interests in the @destructuremal account’s user information and Tweets[.]” People of the State of New York v. Harris, 36 Misc. 3d 613, 617, 945 N.Y.S.2d 505 (N.Y. City Crim. Ct. 2012). “While a Twitter account’s user information and Tweets contain a considerable amount of information about the user, Twitter does not guarantee any of its users complete privacy.” 36 Misc. 3d at 619. Moreover, Twitter notifies its users that it may use any of their posted information for any reason it may have. Accordingly, the court concluded that the “@destructuremal account’s Tweets were, by definition public.” Id. The trial court also held that the subpoena complied with the Stored Communications Act, 18 U.S.C. §§ 2701-2711.
Twitter then filed a motion to quash the court’s order. The court stated that it was a case of first impression, “distinctive because it is a criminal case rather than a civil case, and the movant is the corporate entity (Twitter) and not an individual (Harris).” People of the State of New York v. Harris, 36 Misc. 3d 868, 949 N.Y.S.2d 590 (N.Y. City Crim. Ct. 2012). In denying Twitter’s motion, the court rejected Twitter’s arguments that the defendant had standing to challenge the subpoena, that the defendant had a Fourth Amendment privacy interest, and that the subpoena and order violated the Stored Communications Act. The court concluded that there are consequences for public posts: “If you post a tweet, just like if you scream it out the window, there is no reasonable expectation of privacy. There is no proprietary interest in your tweets, which you have now gifted to the world.” 36 Misc. 3d at 874.
While Harris involved a dispute over obtaining ESI for use as evidence, there also were a number of disputes regarding the admissibility of electronic evidence. For example, in U.S. v. Hamilton, 701 F.3d 404 (4th Cir. 2012), the Fourth Circuit Court of Appeals held that a former Virginia state legislator convicted of bribery and extortion waived spousal privilege for emails he exchanged with his wife through his work email account and workplace computer. The Fourth Circuit found waiver because the defendant failed to take any steps to protect the emails even after he was on notice of his employer’s policy permitting inspection of emails stored on the computer at the employer’s discretion.
In Rodriguez v. State of Nevada, 273 P.3d 845 (Nev. 2012), the Supreme Court of Nevada held that the trial court improperly admitted ten text messages allegedly sent by the defendant because they were not properly authenticated. In a matter of first impression for that court, it held that when there is an objection to the admissibility of a text message, “the proponent of the evidence must explain the purpose for which the text message is being offered and provide sufficient direct or circumstantial corroborating evidence of authorship in order to authenticate the text message as a condition precedent to its admission.” Id. at 849. The court relied on the reasoning of the Superior Court of Pennsylvania in Commonwealth of Pennsylvania v. Koch, 39 A.3d 996 (Pa. Super. Ct. 2011). In this case, the court held that text messages on a defendant’s cellular telephone were not properly authenticated and inadmissible hearsay. It reversed the defendant’s conviction and ordered a new trial because of the erroneous admission of the text messages. The court noted that just as more than one person can use an email address, more than one person can use the cellular phone associated with a text message. Accordingly, the court concluded that “emails and text messages are documents and subject to the same requirements for authenticity as non-electronic documents generally,” and must be authenticated by direct proof or circumstantial evidence. Id. at 1004. The Supreme Court of Pennsylvania has accepted the case on appeal. Commonwealth of Pennsylvania v. Koch, 44 A.3d 1147 (Pa. 2012).
Reaching a different result on the authenticity of information posted on a social media site, the Texas Court of Criminal Appeals held that a defendant’s MySpace pages were properly admitted because the internal content of the defendant’s MySpace postings — photographs, comments, and music — was sufficient circumstantial evidence to establish that the defendant authored those pages. See Tienda v. State of Texas, 358 S.W.3d 633 (Tex. Ct. Crim. App. 2012).
Finally, in In re Oil Spill by the Oil Rig Deepwater Horizon, MDL No. 2179, 2012 WL 85447 (E.D. La., Jan. 11, 2012), the court rejected the plaintiffs’ position that email strings were admissible in their entirety under one or more hearsay exceptions within the Federal Rules of Evidence. The court held that “there is no across-the-board rule that all emails are admissible as business records,” that a number of emails present “double hearsay” issues, that “a forwarded email is only an adoptive admission if it is clear that the forwarder adopted the content or believed in the truth of the content,” and that the “mere fact that a producing defendant’s employee sent an email while at work from a work computer to a co-employee does not mean that the email was composed or received concerning a matter within the scope of an employee’s employment.” Id. at *3-4. In ordering the parties to meet and confer on these evidentiary issues, the court noted that to satisfy the business records hearsay exception, there must be a showing that the employee sending or receiving the email at issue must have been under an obligation imposed by his employer to send or receive the email, and that the email itself must have been created as part of a regularly conducted activity of a business. “[I]f the information within an email pertains to a transaction or report of an isolated, sporadic nature that is not within the scope of what the email sender or recipient regularly does to engage in business, the exception does not apply.” Id. at 5.
10. The Sedona Conference® Announced Its First-Ever Cooperation Training Program.
Over three years ago, The Sedona Conference® issued “The Cooperation Proclamation,” which strives to promote the “just, speedy, and inexpensive resolution of legal disputes on the merits facilitated by cooperative, collaborative, and transparent discovery, electronic or conventional.” As of Oct. 31, 2012, The Sedona Conference® counted over 130 judicial endorsements of The Cooperation Proclamation, and last year it updated its Resources for the Judiciary to “assemble and promote a variety of proven judicial management tools to help parties develop and execute appropriate, cost-effective, cooperative discovery plans” and “avoid unnecessary discovery disputes.” The Sedona Conference® is now stepping up its efforts to promote cooperation in e-discovery by hosting its first Cooperation Training Program. The Program will focus on how to pursue cooperation in addressing pre-litigation preservation demands, reaching agreement on search protocols and custodians, negotiating appropriate forms of production for database and social media discovery, developing cost-saving approaches to privilege review and logging, and avoiding sanctions motions.
Some prominent judges on e-discovery issues also have stepped up their efforts to have litigants work more cooperatively during discovery. For example, U.S. Magistrate Judge David J. Waxse authored a law review article last year encouraging cooperation in the discovery process. See David J. Waxse, Cooperation — What is It and Why Do It?, XVIII Rich. J.L. & Tech. 8 (2012). In his article, Magistrate Judge Waxse commented that cooperation is not happening enough and suggested what could be done to increase cooperation in litigation. In his view, “Both judges and lawyers must stay focused on securing ‘the just, speedy, and inexpensive determination of every action and proceeding,’ and cooperation is the best way to reach that goal.” True to his convictions, in Chura v. Delmar Gardens of Lenexa, Inc., No. 11-2090, 2012 WL 940270 (D. Kan. Mar. 20, 2012), Magistrate Judge Waxse admonished the parties for their lack of cooperation in trying to resolve their discovery dispute and then ordered an evidentiary hearing regarding the defendant’s efforts to preserve and search for ESI responsive to the plaintiff’s discovery requests.
In Tadayon v. Greyhound Lines, Inc., No. 10-1326, 2012 WL 2048257, at *6 (D.D.C. June 6, 2012), U.S. Magistrate Judge John M. Facciola declared “High Noon” on the parties’ ongoing discovery disputes: “[T]here is a new sheriff in town—not Gary Cooper, but me. The filing of forty-page discovery motions accompanied by thousands of pages of exhibits will cease and will now be replaced by a new regimen in which the parties, without surrendering any of their rights, must make genuine efforts to engage in the cooperative discovery regimen contemplated by the Sedona Conference Cooperation Proclamation.” Similarly, in Family Dollar Stores, Inc. v. United Fabrics Int’l, Inc., No. 11 Civ. 2575, 2012 WL 1123736, at *9 (S.D.N.Y. Apr. 4, 2012), U.S. Magistrate Judge James C. Francis IV cited to The Cooperation Proclamation and stated that counsel appeared to be “wasting their clients’ money and the Court’s time” by engaging in numerous discovery disputes.
In the Da Silva Moore case discussed above, Magistrate Judge Peck reiterated his strong endorsement of The Cooperation Proclamation and the need for counsel to cooperate on e-discovery issues, including “transparency in the computer-assisted review process.” 2012 WL 607412, at *11. Finally, in the Kleen Products case discussed above, Magistrate Judge Nolan concluded an opinion resolving the parties’ various discovery issues by noting that The Cooperation Proclamation “calls for a ‘paradigm shift’ in how parties engage in the discovery process,” and by commending the lawyers and their clients “for conducting their discovery obligations in a collaborative manner.” 2012 WL 4498465, at *19. As more judges expect litigants to work together to resolve e-discovery issues, courts no doubt will continue to consider the level of cooperation between the parties as a factor in deciding discovery disputes brought to their attention.
