The EDD Hot Potato…lands at Counsel’s feet

We have blogged about the fact that many corporate law departments try laying the responsibility for Electronic Discovery projects at the feet of the IT staff. The post was partly motivated by this article. Yet, and we have mentioned this as well, case law indicates that it is up to the attorneys, and not the IT technicians, to properly manage the process. As Reed Smith’s Janet Kwaon and Karen Wan state in a new article, counsel delegates this responsibility at his or her own peril:

[I]n the current climate, given the interplay between ethical obligations and standards for professional conduct and these e-discovery requirements, attorneys may be surprised to learn that inattention to e-discovery may not only work to the detriment of clients — it may lead to professional malpractice or the imposition of sanctions on counsel.

In other words, pointing the finger at IT may not allow counsel to shift liability. And the problem is, there really is no easy fix:

The duty of a party to locate and produce all materials responsive to discovery and counsel’s oversight obligations are nothing new to the discovery process. What is new, brought on by the staggering volume of data and the complexities associated with their management, is the broad array of possible pitfalls and the ability to reveal mistakes and outright gamesmanship through the often inerasable trail of electronic evidence.

We have noted the complexities associated with electronic discovery before:

[E]lectronic discovery requires an understanding across several disciplines. Law, IT, records management, and compliance are some of those areas of knowledge from which any discovery team should draw. It is difficult for any one individual to have sufficient knowledge across all these areas, so communication between experts from these professions becomes important.

Furthermore, we have also advised readers that the selection of an EDD vendor is a critical point in any complex discovery project:

It is my view that the process used to select a vendor (or vendors) is one of those key points of time in the litigation, with respect to discovery. A thorough vetting of a vendor’s capabilities, technology, experience and reputation is essential to defending that decision in the future should the need arise.

So what can attorneys do to avoid some of the pitfalls of EDD that we have previously spotlighted? Well,

• Take Discovery seriously. I mean it; stop laughing.
• Learn the case law. Use our Case Bibliography as a starting point.
• Understand the basic technical concepts (ask experts you hire, or plan to hire, about their methodologies).
• Negotiate the 26(f) conference in good faith; and prepare for it as thoroughly as you would for a deposition, or hearing before the judge.
• In-house counsel should learn the basics of their company’s IT infrastructure; outside counsel should assess both their own clients’ data enterprise, and that of the opposing party.
• Hire EDD vendors and experts by thoroughly vetting the candidates. Remember, price is not everything.

Oh. One more thing. Read my blog!

Between a rock and a hard place

Electronic discovery can be a complex matter. The discretion given to individual courts, the demeanor of opposing counsel, the difference in procedural rules between circuits, the manner in which the relevant data enterprise is structured, and other factors can make the entire process quite confusing. Throw in international rules that serve to prohibit production, and according to a recent article on law.com, counsel can find himself (or herself) damned if he does (produce) and damned if he doesn’t. The article focuses on the case of Columbia Pictures Industries v. Bunnell, in which not only did a district court judge conclude that data stored in “RAM” was discoverable, but that producing the data was necessary although that doing so was, at least for some of it, prohibited under the law of The Netherlands. From the article:

The defendants had objected to preserving and producing the Internet protocol addresses in part because that would violate the law of the Netherlands, where their servers were located — in particular, the Netherlands’ Personal Data Protection Act. But Chooljian ruled that the defendants still had to preserve and produce the data.

Their argument was undercut by the fact that, due to recent operational changes, the data for U.S. users were apparently on U.S. servers. However, even if the data were overseas, Chooljian concluded that “it was not clear that the Netherlands’ Personal Data Protection Act applies.”

Finally, Chooljian found that even if the Dutch law did prohibit disclosure of the information, it did not deprive the court of its power to order production and preservation of the data.

The article opines that the court’s decision to require the production of data held in RAM will not be followed, but is troubled with the idea that the court’s holding on the production of data despite legal prohibitions on doing so may be more in line with general judicial opinion. These conflicts will become more commonplace because of the international scope of business, developments in digital systems, and increased legislation over such matters as data protection. The article ends with some pointers, which are worth thinking about.

What are attorneys’ responsibilities concerning their clients’ data enterprising?

I have a few passages concerning this very issue:

Existence of electronically stored information. Prior to the Fed. R. Civ. P. 26(f) conference, counsel should become knowledgeable about their clients’ information systems and their operation, including how information is stored and retrieved. In addition, counsel should make a reasonable attempt to review their clients’ electronically stored information to ascertain the contents, including archival, backup, and legacy data (outdated formats or media). U.S. District Courts (Kan.) Guidelines for Discovery of Electronically Stored Information.

In any case in which an issue regarding the discovery of electronically-stored information is raised or is likely to be raised, the court should encourage counsel to become knowledgeable about their client’s information management systems and their operation, including how information is stored and retrieved. Guidelines for State Trial Courts Regarding Discovery of Electronically-Stored Information, Conference of Chief Judges (Rev. Draft, Sept. 2005).

It is ultimately counsel’s duty to preserve and gather discoverable ESI. Leonard Dutchman, Preserving Data in the Wake of Amended Rule 37(f), http://www.law.com/jsp/legaltechnology/PublArticleFriendlyLT.jsp?id=1160643922347 (last visited October 30, 2006).

Counsel has the duty to properly communicate with its client to ensure that “all sources of relevant information [are] discovered.” Phoenix Four, Inc. v. Strategic Resources Corp., 2006 WL 1409413 (S.D.N.Y 2006) (citing Zubulake v. UBS Warburg LLC, 229 F.R.D. 422 (S.D.N.Y. 2004)).

To identify all [potential sources or relevant information], counsel should become fully familiar with its client’s document retention policies, as well as its client’s data retention architecture. Id.