The Modern Archivist

Will GPS data be on the e-discovery radar?

Is the next technology that companies will need to archive GPS data?  Maybe.  The Supreme Court recently accepted on certiorari the appeal of a case that challenges the use of GPS data for a criminal conviction.  The District of Columbia Court of Appeals reversed the conviction of Antoine Jones in US v. Maynard because the use of GPS data without a warrant violated his Fourth Amendment expectation of privacy.  The lower court convicted him of conspiracy to distribute and possession with intent to distribute cocaine.

The Court of Appeals held that the placing of a GPS device on defendant’s car to observe defendant’s movements over a prolonged period of time violated Jones’ expectations of privacy.  The Justices reasoned that a person would not normally expect the police, if they weren’t using such a device, to monitor his public actions 24 hours a day, seven days a week for prolonged periods.  That type of surveillance was just not practical or reasonable.  The fact that GPS was more practical and cost efficient was of no consequence because a person would never reasonably expect his actions to be monitored that closely.

Moreover, the use of the GPS device resulted in too much data revealing too detailed a picture of defendant’s life.  The continuous GPS data allowed the police to create a detailed picture of how he lived his life over the course of the surveillance.  In many ways, it’s akin to a reality television show based on GPS data rather than video.  This type of detail was an intrusion on his privacy.

This case, and cases like it, perhaps foreshadow what could happen in a civil context.  It’s certainly been proposed (whether it has actually happened I can’t say) that employers could use such devices to track their employees’ movements.  For example, employers concerned about employees who might be taking advantage of certain laws that increase costs incurred by employers (i.e. the FMLA).  Or, perhaps they want to track their sales associates’ whereabouts throughout the day.   This use in turn presents the question of what notice the employer is required to give its employees and when that notice needs to be given.  Is a statement in the employee handbook sufficient?  Perhaps there should be a requirement that notice be given shortly before use of a tracking device giving the employee a more detailed description of what to expect.  (Seems that it could defeat the purpose, however.)

And the use of the device by an employer raises questions regarding data preservation – either for general archiving or for electronic discovery.  If an employer is permitted to legitimately capture and use data obtained from a GPS device, in the vast world of e-discovery, the employer would then logically have to archive it.  This presents more questions surrounding the logistics of archiving this data in the ediscovery and records management worlds.  And this is just the beginning of the questions.  The world of e-discovery has seen a lot of changes over the past decade and has learned to adapt.  It may have to adapt to GPS as well.  I think it will be up to the task!

J-M v. McDermott: Round 1

Let the fight begin!  I, like so many others in the e-discovery universe, blogged a month or so ago after the malpractice case brought by J-M Manufacturing against McDermott became public.  It appears that round one of the fight commenced this week when McDermott filed its demurrer and J-M Manufacturing filed its first amended complaint, the first of likely several more to be filed.

McDermott’s demurrer without doubt asserts the litigation equivalent of fightin’ words.  Its an entertaining litany of defensive attacks on the faults in J-M’s original complaint.  On J-M’s side of the ring, added to its first amended complaint is an ethical claim against McDermott:  McDermott ostensibly held J-M’s files hostage until J-M paid its bill in violation of the California Rules of Professional Conduct – not something to take lightly.  At first glance, the evidence, cited in support of the claim, is pretty damning.  Regardless of the ploys and tactics in the fiasco, I can confidently state, that I am very happy that I am not embroiled in this mess.  I predict that it will get uglier.

What surprises me is that, although the complaint added a new allegation, it did not add any new defendants.  Perhaps there is no basis for a claim (i.e. no privity of contract and no other tortuous conduct that can be alleged for the other’s wrongs in this imbroglio) against Hudson, Stratify or Navigant for the botched job.  It’s hard to say at this point what the relationships were among the parties – named and unnamed – but as the drama unfolds I imagine some of these questions will be answered.

But what did actually happen?  That’s what the discovery process will hopefully clarify (this assumes that McDermott will not prevail on its demurrer) and which I know we are all impatiently waiting to learn.  The truth likely lies somewhere between J-M’s allegations and McDermott’s defenses.  Having been a contract attorney myself and having seen the document review and ediscovery process from a number of angles, there is no doubt in my mind that botched reviews and products are more frequent than comfort would desire.  This doesn’t exactly spell confidence for those on the vendor or law firm side of this equation.  But, on the other side of the equation, clients, as we saw in Broadcom v. Qualcomm, are frequently irresponsible with their data from the get-go, making the job of the vendor that much more difficult and uncertain.

This being said, all of this was likely needless stress and expense.  It has been espoused, not just by myself and my company, but others in the industry, that there is a fairly good solution to these nightmares:  manage your data better to begin with.  I can’t speak to how well J-M actually managed its data, but, in a nutshell, if a company has the proper procedures and technology in place to get control over its data before a dispute ever arises, then the need for multiple vendors and the problems with control over the data are greatly diminished.  Perhaps this case will help foster this realization in those that have yet to see it.

Wake-up call for firms and vendors: Malpractice alleged for e-discovery failures

It appears that the day has come for a client to sue its law firm for a botched contract attorney job.  What surprises me is that the vendor who supplied the contract attorneys is not named in the suit.  And, perhaps even more surprising, the contract attorneys themselves, listed as Does 1 through 10, have been sued, but no partners or associates of the law firm who supervised the contract attorneys are named.  An odd and seemingly incomplete list of defendants.

I wondered several years ago when this day would come.  Clients must deal with the consequences for poor delivery of services by both firms and vendors.  And this happens despite widespread knowledge that contract attorney reviews are at best not well done and at worst appalling.  Even the actual collection and processing of e-discovery, a mostly reactive approach that has typically used multiple solutions, has numerous problems creating costly consequences absorbed by clients even after clients pay exorbitant sums of money for services that were subpar.

 The suit was brought by J-M Manufacturing Co., Inc. against McDermott Will & Emery.  See complaint.  The claims allege that an electronic discovery production supervised by McDermott resulted in the erroneous production of an alleged 3,900 privileged documents that were part of 250,000 documents reviewed.  (That’s 1.5% of the review.)  The documents belonged to approximately 160 custodians of J-M’s ESI.   J-M sued McDermott for its failure to supervise and its “fraudulent, oppressive and malicious misconduct.”  See Amid Rising Fears of E-Discovery Malpractice, Huge Law Firm Faces Lawsuit Charging Misdeeds All Dread, Robert Hilson, June 9, 2011.  (Note that thus far I have seen no reported claims of ethical violations although it wouldn’t surprise me if complaints against McDermott for violating its supervisory obligations under Model Rule of Professional Conduct 5.1 are filed.)

“Fraudulent, oppressive and malicious” all seem pretty extreme to me.  Perhaps I believe in the good of humanity, but I would like to believe that McDermott didn’t fraudulently or maliciously produce 3,900 privileged documents.  No doubt something went horribly awry.  And I’m sure McDermott is, to say it gently, a little bit upset about the situation.  After all, they lost a client and now have a public malpractice suit filed against them which can’t be helping business.  But the alleged errors probably have less to do with any intent on McDermott’s part, or on the contract attorneys’ parts, to do something horribly wrong and have more to do with an e-discovery process that isn’t, and has been shown numerous times not to be working. 

This isn’t to say that McDermott, the contract attorneys or any associated vendors, did not do anything wrong.  Rather, it’s a wake-up call that a system that isn’t working is going to cause problems for its suppliers who have reaped monetary benefits for many years but have evaded the costly consequences.  You can’t have your cake and eat it too.  And now we need to re-evaluate what it is exactly we are doing with all this data. 

Perhaps from this companies, vendors and law firms will recognize that there is a better way to prepare electronic discovery.  (Wishful thinking??)  Vast amounts of data result in too many documents to be prepared reviewed.  Collecting, culling and processing aren’t sufficient to narrow the number of documents that are to be produced.  Predictive coding is helping, but it won’t ever replace document review and still requires some amount of upfront collection and culling.  Some in the industry are finally recognizing that ESI, just like paper records, has to be managed from the beginning – documents that aren’t needed must be destroyed, and documents that are needed must be kept and organized in a simple easy-to-search repository.  The downstream processes become easier to manage with more accurate and defensible results.  There is at least one system out there that can do this.

The abominable e-discovery sanction wearing an attorney cloak

It’s not too often (although it’s on the rise) that a court sanctions counsel for e-discovery violations.  It certainly presents a bit of an ethical conundrum when you get down to it:  how much control did counsel have over his or her client?  Did counsel properly advise his client?  Or, did the client fail to follow counsel’s advice or properly implement the appropriate measures for proper e-discovery production?  In a recent case, Greene v Netsmart Technologies, Inc., E.D. N.Y., Docket 08-CV-4791 (Feb. 28, 2011), the issue has again been addressed.  In Greene, the Magistrate Judge issued a Report and Recommendation (R&R) that, among other things, ordered sanctions be split 50/50 by both the plaintiff and his counsel.  The R&R was affirmed on appeal.

The distinguishing factor in Greene is that the Magistrate Judge didn’t specify what exactly counsel did or whether counsel was negligent or grossly negligent in managing e-discovery practices.  Nor does it appear from the R&R that counsel displayed a pattern of misconduct with regards to e-discovery.  In most other decisions where counsel was sanctioned the level of counsel’s misconduct was identified and counsel was generally only sanctioned where he or she had displayed a pattern of misconduct.  Sanctions for E-Discovery Violations: By The Numbers, Dan H. Willoughby Jr. et al., Duke L. J., 789-864 at 818 (2010). 

To the contrary, the Magistrate Judge noted that Plaintiff had conceded that he had control of the evidence and knew that he had a duty to preserve it.  Other than noting in the factual statement that plaintiff’s counsel had not timely responded to a request for documents on a couple of occasions, there was no other mention of what exactly counsel did wrong.  The Magistrate Judge stated that “[h]aving considered all of the facts, I find that Plaintiff and/or his counsel acted in a manner that meets the ‘ordinary negligence’ standard.” Id. at 16.  She also concluded that “there was clearly a breakdown in communication between Plaintiff and his counsel regarding document preservation and collection.”  Id.

Couldn’t you draw the conclusion that there was a ‘breakdown in communication’ in most e-discovery sanction cases?  After all, if a party isn’t producing what should be produced, somewhere counsel and the party have likely failed to communicate.  However, whether the breakdown in communication was the result of counsel or the party’s misdeeds are two separate matters.  In each instance, it would seem prudent to evaluate both counsel and plaintiff to determine who was negligent, or if both were negligent.  In Greene, there appears to have been no evaluation of counsel’s conduct.

Regardless, the decision presents several interesting considerations.  As we saw in Broadcom v. Qualcomm last decade, one of the paramount concerns is how counsel can defend themselves when the attorney-client privilege obligates counsel to an oath of silence.  Should there be modifications to the rules surrounding attorney-client privilege?  How should such disputes be handled?  Beyond the issue of privilege, who should be responsible for e-discovery practices, especially in the face of outsourcing?  Does there need to be a pattern of misconduct for counsel to be sanctioned?  What obligations do attorneys have to learn more about technology to properly advise their clients or seek outside assistance from someone with that expertise? And, if outside assistance is sought and it comes from a non-attorney, what obligations does that impose on the attorney? 

There are a slew of other questions, but you get the point.  Likely, we will see more guidance in this area as e-discovery continues to evolve and more attorneys are sanctioned.  Moreover, as the industry matures and as e-discovery attorneys and businesses recognize of the importance of information governance, will this assist in reducing sanctions – not just for counsel, but for parties as well?  If only I had a looking glass.

Listen to the Court!

                Ok, I admit, I want to blog about Chief Judge Lamberth’s Memorandum Opinion in DL v. District of Columbia because I really want to quote the judge:  “Imagine a standup comic who delivers the punch-lines of his jokes first, a plane with landing gear that deploys just after touchdown, or a stick of dynamite with a unique fuse that ignites only after it explodes.  That’s what document production after trial is like – it defeats the purpose.”  See page 1.  And that’s only one of many memorable quotes in the Chief Judge’s decision to deny the District of Columbia’s Motion for Reconsideration of the sanctions it received for its e-discovery violations.

                The lesson to be learned here is that when a court renders an order, it’s not because it enjoys applying ink to paper.  They mean business.  And, as the Court noted, orders can also be rendered to provide guidance to those who may need some hand holding because the federal rules have failed to provide that party the clarity needed to be compliant with them.  See page 11-12.  In DL, the District failed – on numerous occasions – to adhere to the Court’s order.  According to the court, the District had “its head apparently buried in the sand….”  See page 5.  My take from this:  practicing law while acting like an Ostrich is not a good way to practice.  Sure.  It’s a bit of an understatement.  But you get the point.

                The seriousness of court orders, not just the order in DL v. the District of Columbia, seems to be missed by many litigants who are dealing with e-discovery issues.  It isn’t always clear how many of the failures are due to a flat out disregard of the orders.  I imagine that most litigants don’t set out with the mindset that they are going to willingly disregard orders given to them by a higher authority.  Rather, blatant disregard or egregious failures to comply with discovery rules and court orders appears more likely to be related to companies and attorneys who still don’t quite get the complexity and costs of e-discovery. 

                Another point I gleaned from the Chief Judge’s decision:  be transparent.  Most of us involved with electronic discovery know how complex it can be and how voluminous the data is.  When faced with trouble, ask for help.  Don’t walk blindly through the sandbox.  Transparency in e-discovery appears to be rewarded more frequently these days.  To quote the Chief Judge one more time:  “The District’s complaints of lack of resources and time pressure fall on deaf ears because it failed to seek relief through [discussions at status conferences, motions for extension of time or status updates to alert the Court].”  See page 14.  If you wait until trial to express your concerns and problems, your chances of failure are extremely high.

                Ultimately, the District was ordered to turn over all the emails within a week of trial and waived any claims of privilege.  The plaintiffs will have an opportunity post-trial to introduce new evidence found amongst the District’s most recent product, which, of course, could include privileged materials.  Not a position I would want to be in.

What will be the end when we arrive?

                And the Rambus drama continues… .  The Federal Circuit, in its May 13^th decision Micron v. Rambus , agreed with the lower court that Rambus engaged in spoliation, but it remanded the matter for a determination of whether bad faith and prejudice were sufficient enough to warrant the terminating sanction issued by the District of Delaware.  The Federal Circuit also remanded the companion case Hynix for further proceedings that are to conform with Micron.  Whether or not this is good news for Rambus remains to be seen.  For the moment, however, the Federal Circuit seems to be intimating that the terminating sanction issued by the District of Delaware in Micron might be a tad harsh and need to be reconsidered to ensure that Rambus actually acted with sufficient bad faith that prejudiced the other parties.

                It seems like a strange decision in the face of facts that seem to point in only one direction:  bad faith and prejudice.  Rambus implemented a document retention plan that required destruction of relevant and discoverable evidence until the commencement of litigation despite the inevitability of litigation. “Despite the policy’s stated goal of destroying all documents once they were old enough, [Rambus’s VP of IP]  instructed employees to look for helpful documents to keep, including documents that would “help establish conception and provide that [Rambus had] IP.”  See pages 7-8 of Micron v. Rambus.  The document destruction extended to email backup tapes because Rambus feared that the tapes had “’discoverable information.’”  The litigation department would not let Rambus keep the tapes for longer than three months with one exception – a tape that had documents that were beneficial to Rambus.

                Additionally, Rambus held two “shred days” where employees shredded 700 boxes of paper documents.  No record of what was shredded was kept.  Rambus also instructed its patent prosecution counsel to shred documents that were relevant to the supposed IP.  Sounds almost conspiratorial in nature and makes me think of Broadcom v. Qualcomm.  Moreover, the record is replete with comments from Rambus executives of impending litigation, delays in litigation, licensing or litigation its IP, etc. 

                Despite the Federal Circuit’s hesitation on confirming the Delaware District Court’s terminating sanction, one thing does appear to be clear:  where documents are destroyed under a retention policy requiring destruction, with the exception of those documents that are favorable to the company, even though litigation is inevitable even if not imminent results in spoliation.  Of course it is not wrongful for a business to have a valid retention policy that rids it of unneeded documents.  But, what a valid policy is, however, still has plenty of shades of grey.  “[W]here a party has a long-standing policy of destruction of documents on a regular schedule, with that policy motivated by general business needs, which may include a general concern for the possibility of litigation, destruction that occurs in line with the policy is relatively unlikely to be seen as spoliation.”  See page 16 of Micron v. Rambus.  Regardless, frustrating your opponent’s ability to defend itself in litigation is not a valid retention policy.

                Despite the evidence against Rambus that strongly supports a conclusion of bad faith and prejudice, we will have to wait for another day to learn what sanctions might be applied to Rambus’s spoliation.  Perhaps the courts will consider a scarlet letter sanction such as the one issued in Green v. Blitz?  Not that Rambus hasn’t already been dragged through the limelight.

The Scarlet Letter Sanction

There appears to be a new neighbor on the block of e-discovery sanctions: the scarlet letter. Among monetary sanctions, the judge in Green v Blitz, 2011 WL 806011 (E.D. Tex March 1, 2011), sanctioned defendants by requiring them to provide his opinion to every plaintiff in every lawsuit it has preceding against it for the past 2 years and to file a copy of the opinion in every court where it is a participant in a suit for the next 5 years. Blitz has begun the walk of shame.

Obviously, there are logistical issues with enforcing this type of sanction. I find it questionable how effective a sanction that requires a dishonorable party to comply with the honor code if the court itself doesn’t actively monitoring of the party. There is no mention of how defendant would be monitored. Perhaps this is an opportunity for some savvy entrepreneur to create a program to monitor compliance with scarlet letter sanctions. Just a thought.

Regardless, if Blitz actually complies with the sanction, or the court monitors Blitz into compliance, perhaps wearing the scarlet letter will act as warning to others that if they willfully fail to comply with their e-discovery obligations, they too could wear the scarlet letter. At the very least, Blitz’s opponents will now know that Blitz is not to be trusted: anything Blitz does should be looked at not once, not even twice, but multiple times under a very high-powered magnifying glass for any scintilla of evidence that they are not coughing up all the evidence. A side effect could be an increase in motions to compel doubling the courts work load. Will the court be ok with that? Will the purpose of the sanction be effective? Only time will tell.

So, the sanction begs the question: What, oh what, did the defendant do to warrant such punishment? It willfully failed to produce documents. You would have thought they’d have learned by now: the courts are losing their patience and becoming, to say it gently, ticked-off about willful failures to produce electronic materials. But, perhaps because this is a products liability case, and not one of the more traditional large commercial litigation disputes already well-versed in e-discovery, Blitz had not quite figured out that it, too, was part of the e-discovery universe.

This case dealt with a gas can that did not have a flame arrester, the addition of which may have prevented the death of plaintiff’s husband. An obvious document to produce would be one that had the words “flame arrested” in it. But, Blitz failed to produce at least a few of those emails, some that specifically had a subject header of “flame arrester.” But let’s give them some slack. After all, the person in charge of discovery described himself as “about as computer literate-illiterate as they get.” I’ll let you draw your own conclusions about how far that defense got them.

In addition to shoddy searches, during the relevant time frame, Blitz’s IT department routinely sent emails requesting its employees to delete emails – not just from the inbox, but from the deleted and sent folders as well. Their ability to be thorough and persistent in asking their employees to delete emails was not transferred to implementing legal holds and preserving documents for discovery. Nor was Blitz forthcoming about documents it claimed were work product, but which it failed to list on its privilege log.

I’d bet all my poker chips that Blitz probably thought it wouldn’t get caught. Unfortunate for them that counsel for plaintiff in this matter was also counsel for a plaintiff in another similar matter where emails relating to subject matter of this suit were produced. (By the way, from my experience in the world of personal injury and products liability, it’s not exactly uncommon for a single plaintiff’s attorney to bring multiple suits against the same defendant.) Regardless, it will indeed be interesting to see how this sanction impacts e-discovery and what the next creative sanction could be.