Post Process

Everything to do with E-discovery & ESI

Archive for the ‘7th Circuit’ Category

Case Blurb: Lafarge North Am.; Measures for Protecting ESI

Posted by rjbiii on April 5, 2010

[The expert witness] sets out and expounds on five “generally accepted measures” for protecting electronic information:
(1) establishing and communicating protection polices;
(2) need-to-know distribution of confidential information;
(3) marking information as “confidential” or “proprietary”;
(4) maintaining confidentiality agreements; and
(5) controlling access to information with physical or electronic systems.

The measures [the expert] identifies appear reasonable.

United States Gypsum Co. v. Lafarge North Am. Inc., 670 F. Supp. 2d 768, 773 (N.D. Ill. 2009)(internal citations removed).
See Case Summary here.

Posted in 7th Circuit, Case Blurbs, Information Security, Judge Rebecca R. Pallmeyer | Leave a Comment »

Case Summary, Lafarge North Amer.; Accusations of Spoliation and E-Discovery Experts

Posted by rjbiii on April 5, 2010

United States Gypsum Co. v. Lafarge North Am. Inc., 670 F. Supp. 2d 768 (N.D. Ill. 2009)

Background: Plaintiffs US Gypsum Co. (USG) claim that Defendants Lafarge North. Am. (Lafarge) infringed USG’s patents and stole confidential information relating to wallboard manufacture.
Procedural Status: The court considers motions by each party to exclude the testimony of the other party’s forensics expert.

Basic Points:

  • A witness may be qualified as an expert by knowledge, skill, experience, training, or education.
  • An expert witness may testify to those areas within his expertise, which may include areas closely associated with or encompassed in general by their subject of expertise, even if not explicitly stated in their credentials.
  • An expert witness may not testify to the state of mind of actor’s without specific qualification, or based on speculative means.
  • Accusations of spoliation based on speculation are barred from admission
  • Criticisms on one expert’s methodology based solely on a study of that methodology, and absent an independent study, are admissible to the extent the criticisms are based on expert-level knowledge and not speculative means.

Admissibility of Expert Testimony in General:

Under FRE 702, a witness can be qualified as an expert by “knowledge, skill, experience, training, or education. Courts consider a proposed expert’s full range of practical experience as well as academic or technical training when determining whether that expert is qualified to render an opinion in a given area.”

The court stated that the admissibility of expert testimony depends not only on the witness’s qualifications as an expert. Under Daubert, court’s are to consider the following factors, among others that may present themselves:

(1) whether the expert’s technique or theory can be or has been tested–that is, whether the expert’s theory can be challenged in some objective sense, or whether it is instead simply a subjective, conclusory approach that cannot reasonably be assessed for reliability;
(2) whether the technique or theory has been subject to peer review and publication;
(3) the known potential rate of error of the technique or theory when applied;
(4) the existence and maintenance of standards and controls; and
(5) whether the technique or theory has been generally accepted in the scientific community.

The court must ensure, therefore, that the proffered testimony has, at its core, some reliable basis. The testimony must also be relevant, so that it assists the trier of fact in understanding the evidence or in determining a fact in issue.

Testimony of Carl Florez:
Carl Florez was retained by Plaintiffs to testify to the security measures undertaken by USG to protect its proprietary information.
Upon examining Mr. Florez’s qualifications, it concluded that he was a qualified expert in the areas of computer forensics and investigation. In his expert reports, Mr. Florez offered a list of “reasonable” measures a company might take to protect its confidential information, and then compared them to the measures implemented by USG. He concluded that “USG’s efforts to protect the secrecy of its proprietary and confidential information, including the information that is electronically stored, are more than reasonable, and are among the most thorough I have encountered in my experience.”

Defendants Lafarge, contended that Florez is not qualified to render an opinion regarding the steps USG took to protect its confidential information. While acknowledging Florez’s knowledge and experience in the areas of computer forensics, defendants argued that has no apparent expertise in the steps necessary to protect the secrecy of information. Florez’s opinions on these matters are, therefore, unreliable.

In beginning its analysis, the court stated the following rule: whether a witness is qualified as an expert can only be determined by comparing the area in which the witness has superior knowledge, skill, experience, or education with the subject matter of the witness’s testimony. Florez has gained expertise and familiarity with how breaches occur, including the measures and countermeasures used to protect information and to overcome protections. Efforts to protect information and efforts to access confidential information evolve on parallel tracks, such that a person familiar with the challenges of accessing protected information will also be familiar with steps necessary to protect it. Florez’s unique familiarity with computer crime provides him with an understanding of computer security measures. The court concluded that Florez’s testimony passed the test.

Defendants also argued that Florez’s opinion with respect the reasonableness of USG’s data security measuares rested on an unreliable method. Again, the court disagreed. Florez’s failure to undertake a specific experimental analysis in reaching his opinion does not, by itself, require the court to exclude his testimony. Indicators of reliability depend on the particular circumstances of the particular case at issue. Determining whether a particular activity is reasonable in light of other facts is often a function of experience, of which Defendants admit Mr. Florez has a sufficient measure. The court was persuaded that in this case, experience provided a reliable basis for determination of what precautions are reasonable and effective to prevent breaches

Reasonable Measures Cited by Mr. Florez:
Florez cited and expounded on five “generally accepted measures” for protecting electronic information:
(1) establishing and communicating protection polices;
(2) need-to-know distribution of confidential information;
(3) marking information as “confidential” or “proprietary”;
(4) maintaining confidentiality agreements; and
(5) controlling access to information with physical or electronic systems.

In the context of forming his opinion, Florez consulted authoritative sources and publications in the field. He also compared USG’s policies with those at several other organizations he was familiar with, including the FBI. Defendants suggested that these comparisons are inadequate because none of these organizations is in the manufacturing business or construction industry. While the court acknowledged that discussion of confidentiality measures in the manufacturing setting might have been useful, its omission was not fatal, as the need for security in manufacturing sector here cannot be greater than that present at the FBI. The court concluded that Florez’s opinion appeared reasonable, even in the face of his inability to cite specific sources of information used for his analysis.

Mr. Florez’s Analysis of the Intent of Actors:

The court did agree with Defendants assertions that where Mr. Florez made oblique references to the state of mind of certain actors, he appeared to exceeded the scope of his expertise. The court noted that nothing in the record suggested that Florez was particularly qualified to understand the mental attitudes of others. Even assuming he were, he is able to render an opinion on intent only by drawing inferences from the evidence. Such opinions merely substitute the inferences of the expert for those the jury can draw on its own. Thus, the court excluded this type of testimony from the case.

Mr. Florez’s Analysis of Document Spoliation:

In his reports, Florez opined that various Defendants committed intentional acts of spoliation to cover up the misappropriation of USG documents. In an earlier opinion, the court had barred USG, its attorneys and witnesses from offering evidence of any alleged spoliation of evidence by any of the Defendants . . . and precluding all comment or testimony on such matters in the presence of the jury, either directly or indirectly, at any stage of trial from jury selection to verdict. Plaintiff now sought to use Florez’s testimony to explain “what steps were taken resulting in deletion of the documents, how partial information was recovered, and what information is irretrievably lost.”

The court was not persuaded to change its view on the matter of accusations of spoliation. The opinion stated that plaintiffs implicitly conceded that the main purpose of Florez’s testimony was to create the inference that Defendants intentionally destroyed evidence in an attempt to cover up alleged wrongdoing. Because plaintiffs offer no new non-speculative evidence on the issue, the court prohibited all testimony of this type.

Testimony of Andrew Reisman:

Mr. Reisman opined primarily on the validity of Florez’s methods and conclusions, contending that the evidence Florez reviewed failed to establish his subsequent findings. Mr. Reisman conducted no independent investigation or data analysis, but rather he reviewed Florez’s reports and consulted the same data Florez did. Plaintiff suggested that Reisman was obligated to undertake a broader investigation because he “had unfettered access to the entire Lafarge computer network” and concludes that the failure to do so constituted cherry-picking data in a way that fatally undermined the reliability of his conclusions. Defendants respondrf that Reisman would testify, based on his own experience, to “what forensic analysts do, what information they look at, what conclusions they can reach, and what conclusions they cannot reach based on forensic evidence.”

The court concluded that Reisman’s methodological criticisms were sufficiently based on his relevant experience to be reliable, and because computer forensics is a highly complicated area, the jury would benefit from having access to criticism from another expert in the field. However, to the extent that Reisman’s opinion offers speculation with respect to the use or dissemination of USG information at Lafarge, in the guise of criticizing Florez’s methodology, such testimony will be excluded.

The court ruled that any comments from Reisman that appear to divine an actor’s intent through speculative means will also be excluded. Finally, the court also ruled that Reisman may not opine on issues of spoliation or destruction of documents in answer to Florez’s accusations, becuase those accuasations have already been barred. Anything that Reisman would add is therefore not needed.

Posted in 7th Circuit, Case Summary, Expert Witness, FRE 702, Information Security, Judge Rebecca R. Pallmeyer, N.D. Ill., Spoliation | Tagged: , | 1 Comment »

Case Blurb: Mirbeau of Geneva Lake; Right of a Party to Conduct its own Search

Posted by rjbiii on December 29, 2009

[T]he federal rules do not give a party the “right to conduct its own search of [another party’s] electronic devices. Instead, in facilitating the production of ESI, the federal rules “allow the responding party to search his [or her] records to produce the required, relevant data.” Only if the moving party can actually prove that the responding party has concealed information or lacks the expertise necessary to search and retrieve all relevant data, including metadata or residual data, is it proper for the moving party to initiate the searches of the other party’s ESI.

Mirbeau of Geneva Lake LLC v. City of Lake Geneva, 2009 U.S. Dist. LEXIS 101104, at *3-4 (E.D. Wis. Oct. 15, 2009)

Posted in 7th Circuit, Case Blurbs, Data Collection, Data Sources, E.D. Wis., Judge J.P. Stadtmueller | Leave a Comment »

Case Blurb: Mirbeau of Geneva Lake: Paper not a Substitute when ESI is Requested

Posted by rjbiii on December 29, 2009

It is not a valid ground for objection that “relevant, non-privileged, electronic data can be produced in paper form, when the requesting party has specified product in an electronic format.”

Mirbeau of Geneva Lake LLC v. City of Lake Geneva, 2009 U.S. Dist. LEXIS 101104 at *3 (E.D. Wis. Oct. 15, 2009)

Posted in 7th Circuit, Case Blurbs, E.D. Wis., Form of Production, Judge J.P. Stadtmueller | Leave a Comment »

Case Blurb: Mirbeau of Geneva Lake; Discoverability of ESI

Posted by rjbiii on December 29, 2009

The advisory notes to the Federal Rules of Civil Procedure indicate that the federal rules take an “expansive approach toward discovery of ESI and that “discovery of [ESI] stands on equal footing with discovery of paper documents.” ESI must be produced, “translated, if necessary by the respondent into a reasonably usable form.”

Mirbeau of Geneva Lake LLC v. City of Lake Geneva, 2009 U.S. Dist. LEXIS 101104, at *2-3 (E.D. Wis. Oct. 15, 2009)(internal citations removed).

Posted in 7th Circuit, Case Blurbs, E.D. Wis., Form of Production, FRCP 34(a), Judge J.P. Stadtmueller, Scope of Discovery | Leave a Comment »

Case Blurb: Mirbeau of Geneva Lake; Looking for Standardization of ESI Scope? Don’t.

Posted by rjbiii on December 29, 2009

Federal Rule of Civil Procedure 26(b)(1) allows parties to obtain discovery regarding any matter, not privileged, which is relevant to the claim or defense of any party. Relevant information need not be admissible at trial if the discovery appears to be reasonably calculated to lead to the discovery of admissible evidence. The Court has broad discretion when reviewing a discovery dispute and “should independently determine the proper course of discovery based upon the arguments of the parties.” The court should consider “the totality of the circumstances, weighing the value of material sought against the burden of providing it, and taking into account society’s interest in furthering the truth-seeking function in the particular case before the court.”

Mirbeau of Geneva Lake LLC v. City of Lake Geneva, 2009 U.S. Dist. LEXIS 101104 at *2 (E.D. Wis. Oct. 15, 2009)(internal citations removed)(emphasis added).

Posted in 7th Circuit, Case Blurbs, E.D. Wis., FRCP 26(b), Judge J.P. Stadtmueller, Relevance, Scope of Discovery | Leave a Comment »

Case Blurb-IL: Perks; Court discusses state causes of action for spoliation

Posted by rjbiii on November 18, 2009

U.S. District Court interprets state law.

The Defendants further claim that Perks does not allege when Shelby County erased or “wrote over” the relevant videotapes. “It is well settled that Illinois courts do not recognize negligent spoliation of evidence as an independent cause of action.” “An action for negligent spoliation can be stated under existing negligence law without creating a new tort.” Thus, negligent spoliation of evidence is a derivative action that arises out of other causes of action. Although there typically is no duty to preserve evidence, such a duty may arise through an agreement, a contract or a statute. In such cases, “a defendant owes a duty of due care to preserve evidence if a reasonable person in the defendant’s position should have foreseen that the evidence was material to a potential civil action.”

Perks v. County of Shelby, 2009 U.S. Dist. LEXIS 77575 (C.D. Ill. Aug. 31, 2009)(internal citations removed)

Posted in 7th Circuit, C.D. Ill., Case Blurb-IL, Judge Richard Mills, Spoliation, states | 1 Comment »

Case Summary: Heriot; Vendor Error resulting in Production of Privileged Documents did not Waive Privilege

Posted by rjbiii on April 1, 2009

Heriot v. Byrne, 2009 U.S. Dist. LEXIS 22552 (N.D. Ill. Mar. 20, 2009)

To assist them in complying with a production request, responding party hired a vendor to provide scanning and other services associated with discovery. The Vendor created a “master database” that responding party used to conduct their document review. Documents designated for production were then copied to a “production database,” where they would be “marked” with an appropriate confidentiality designation.

Responding party sent hard copy versions of immigration documents to the vendor with instructions to digitize the documents, load them into the Master Database, copy them to the Production Database, apply the appropriate confidentiality legend and bates numbers, and include them in the next production. The vendor, however, mistakenly exported not only the requested documents, but other, privileged documents as well. This resulted in the inadvertent production of privilege. The error was not in the instructions given to the vendor, but was in the vendor’s execution of those instructions. Requesting party then filed a motion

During the production, requesting party asked the responding party if any documents had been withheld due to privilege. Responding party answered in the negative. Responding party subsequently learned of the error, and informed opposing counsel while requesting the documents be destroyed. Opposing counsel destroyed all documents but one set, which it filed under seal with the court. They then filed motions with the court requesting, inter alia, that the court prevent the “claw back” of the documents and instead compel their production. Responding party asserted that the documents were privileged.

The court began its analysis by determining that FRE 502 applied to the case, and crafting a new protocol for deciding whether inadvertent production necessitates the waiver of privilege (see our case blurb here).
Based on the results of an in camera review, the court decided that the documents at issue were privileged, and that the crime-fraud exception does not apply.

The court applied FRE 502(b) by considering: 1) whether disclosure was inadvertent; 2) whether responding party took reasonable steps to prevent disclosure; and 3) whether responding party took prompt steps to rectify the inadvertent disclosure. The court noted that prior to the promulgation of the new rule, the burden rested with the party claiming privilege to prove its contentions. The court saw no reason to shift this burden.

In determining whether a production was inadvertent, the court weighed such factors as: the total number of documents reviewed, the procedures used to review the documents before they were produced, and the actions of producing party after discovering that the documents had been produced.

Additionally, the court examined “the extent of the disclosure” and “the scope of discovery,” while commenting that these two factors operated on a sliding scale: the broader the scope of the discovery, the more extensive a party’s disclosure of confidential materials may be without waiving the privilege, and vice versa. The court noted that the privileged documents comprised 5% of the volume of pages produced, and 13% of the volume of the documents produced, labeling these figures neither apoplectically large nor astonishingly small. The court described the extent of the disclosure as being “broad” and the magnitude of the percentages as “not insignificant.” Nevertheless, the court found other factors more significant for the purpose of its analysis, particularly the actions of the producing party upon discovering the mistake. Because the responding party took immediate action, the court decided that the first factor weighed in favor of responding party, concluding that the production was inadvertent. The court then addressed the second factor of its test, the party’s steps to remedy the inadvertent disclosure. Therefore, as long as reasonable procedures were in place prior to “turning the documents over to the vendors,” the responding party met its obligations. The court concluded, therefore, that responding party did take reasonable measures to prevent inadvertent production.

In beginning the second part of its three-step analysis, the court cited the advisory committee’s notes that it may, in making this determination, consider several factors, including “the number of documents to be reviewed and the time constraints for production”; whether “a party that use[d] advanced analytical software applications and linguistic tools in screening for privilege and work product”; and whether “[t]he implementation of an efficient system of records management before litigation.” The court emphasized that the producing party was not required to engage in a post-production audit, although it was required to follow up on any obvious indications that a protected communication or information has been produced inadvertently.

In the third and final part of its analysis, the court stated that case law it unearthed stood for the proposition that how the disclosing party discovers and rectifies the disclosure is more important than when after the inadvertent disclosure the discovery occurs. In the case at bar, responding party discovered the error earlier than had the responding parties in the cases examined by the court, and were as diligent. In those cases, the disclosing parties were found to have acted appropriately. Therefore, the court found that Plaintiffs took prompt steps to rectify their inadvertent disclosure.

The court concluded that the responding party’s disclosure was inadvertent and that they did not waive the attorney-client privilege as to the Sequestered Documents.

Posted in 7th Circuit, Case Summary, EDD Vendors, FRE 502, Magistrate Judge Martin C. Ashman, Privilege, Waiver of Privilege | Leave a Comment »

Case Blurb: Herriot; Court re-crafts protocol for privileged waiver on inadvertently produced documents (7th Cir.)

Posted by rjbiii on March 30, 2009

Ordinarily, disclosure of confidential information to an unprotected third party operates as a waiver. Under FRE 502, however, disclosure of privileged information will not operate as a waiver when “(1) the disclosure is inadvertent; (2) the holder of the privilege or protection took reasonable steps to prevent disclosure; and (3) the holder promptly took reasonable steps to rectify the error, including (if applicable) following Federal Rule of Civil Procedure 26(b)(5)(B).” All three elements described in FRE 502 must be satisfied to prevent a waiver.

Plaintiffs argue that “[FRE] 502 is applicable to this case[,] and Defendants offer no reason why it would not be ‘just and practicable’ to apply [FRE] 502 to this case as in every other case.” Defendants argue that this Court should apply the three-part inquiry quoted in Judson. The Judson test requires the court to decide (1) whether the disclosed material was privileged, (2) whether the disclosure was inadvertent, and (3) whether the privilege was waived.

There is no question that FRE 502 applies to this case. The 2008 Amendment clearly stated that FRE 502 applies to matters pending on September 19, 2008, “insofar as is just and practicable.” This matter was pending on that date, and this Court finds no reason, and Defendants have pointed to none, that precludes the application of FRE 502.

[…]

To properly assess whether FRE 502(b) overrides Judson, this Court examines each step of the Judson test.

The first step of the Judson test requires the court to determine whether the documents at issue are privileged. This step must remain in place under FRE 502(b), which applies only to privileged information that was inadvertently disclosed. Prior to addressing any of the elements stated in FRE 502(b), therefore, the court must determine whether the documents are privileged. If the documents are not privileged, the inquiry ends. If the documents in question are privileged, then FRE 502(b) applies, and the court must determine whether each of FRE 502(b)’s elements was satisfied. The first element of FRE 502(b), which also is the second step of the Judson test, requires the court to assess whether the party’s disclosure was inadvertent. Therefore, this Court will assess whether a disclosure is inadvertent. FN6

FN6: Inadvertence under FRE 502(b) is not necessarily the same as, and does not necessarily mirror the case law describing, inadvertence under Judson.

Defendants also urge this Court to adopt Judson’s third step, which requires the court to determine, using a “balancing approach,” whether a waiver occurred despite the inadvertent disclosure of privileged information. The balancing approach requires the court to consider “(1) the reasonableness of the precautions taken to prevent disclosure; (2) the time taken to rectify the error; (3) the scope of the discovery; (4) the extent of the disclosure; and (5) the overriding issue of fairness.”

That tack, however, has been at least partially foreclosed by Congressional action. FRE 502 specifically states that inadvertent disclosure “does not operate as a waiver in a Federal . . . proceeding.” In other words, the second and third steps of the Judson test have been folded into the entire FRE 502(b) inquiry. FRE 502 does not, however, prohibit the use of the Judson factors. FED. R. EVID. 502(b) advisory committee’s note (noting that the non-dispositive factors a court may consider “are the reasonableness of precautions taken, the time taken to rectify the error, the scope of discovery, the extent of disclosure and the overriding issue of fairness”). Thus, while “[FRE 502(b)] is flexible enough to accommodate any of those listed factors,” it “does not explicitly codify [the Judson] test[] because [the factors it uses are] a set of non-determinative guidelines that vary from case to case.” Therefore, the court may, but need not, use some or all of the Judson factors to assess whether FRE 502(b)’s requirements have been satisfied.

This Court therefore adopts the following test. First, a court determines whether the disclosed material is privileged. If it is not, the inquiry ends. If the material is privileged, the court applies FRE 502(b). If the court concludes that disclosing party satisfied all of the elements in FRE 502(b), the privilege is not waived. If, however, the disclosing party fails to satisfy any of the FRE 502 elements, the privilege is waived. In applying FRE 502(b), the court is free to consider any or all of the five Judson factors, provided they are relevant, to evaluate whether each element of FRE 502(b) has been satisfied. FN7.

FN7: One court has applied FRE 502(b) in a rather peculiar fashion, choosing to adopt the factors articulated in the committee’s note as a wholesale test of inadvertent disclosure. Rhoads Indus., Inc. v. Bldg. Materials Corp. of Am., 254 F.R.D. 216, 218-27 (E.D. Penn. 2008). Strangely, using only the Judson factors to determine the waiver question eliminates any need to consult the elements required under FRE 502. Such an approach would ignore a Congressional mandate and substitute judicial holdings for legislation. Therefore, this Court concludes that a better approach focuses on the elements required by FRE 502 and uses the Judson factors, where appropriate, to supplement this analysis.

Heriot v. Byrne, 2009 U.S. Dist. LEXIS 22552 at *16-(N.D. Ill. Mar. 20, 2009) (internal citations removed)

Posted in 7th Circuit, Case Blurbs, FRE 502, Magistrate Judge Martin C. Ashman, N.D. Ill., Privilege, Waiver of Privilege | 1 Comment »

Case Blurb: Perfect Barrier; “native” e-mail format production appropriate

Posted by rjbiii on June 17, 2008

[Producing Party] produced the emails in electronic form on an disc that is computer accessible. Such discovery is clearly considered electronic discovery. Under Fed.R.Civ.P. 34(b)(2)(E)(ii),
[i]f a request does not specify a form for producing electronically stored information, a party must produce it in a form or forms in which it is ordinarily maintained or in a reasonably usable form or forms.
[Requesting Party] did not request that the emails be produced in a particular form, yet [Requesting Party] now asks this Court to force [Producing Party] to produce the electronic emails as Static Images with a bates-number identifier. [Producing Party] objects to this request because it would cost a substantial sum of money to convert the documents from the form in which the documents are normally kept, Native format, to Static Images.

[Producing Party] has already produced the emails on a disc in Native format. [Requesting Party] maintains the email documents in such a format. Fed.R.Civ.P. 34 only requires [them] to submit the emails in the format in which it keeps them, Native format, and nothing more. While it may be more convenient for [Requesting Party] to have the emails as Static Images, Fed.R.Civ.P. 34 does not provide that convenience is a basis for requiring electronic discovery to be produced in a different format than normally maintained. If [Requesting Party] wanted the emails as Static Images, it should have specified this request in its requests for production, which it did not do.

Furthermore, this Court finds that the emails produced on an electronic media such as disc is reasonably usable. [Requesting Party] can access, examine, and even print the communications. While [Requesting Party] may prefer to have them as Static Images, the burden to convert the emails to Static Images remains with [Requesting Party]. [Producing Party] complied with Fed.R.Civ.P. 34(b)(2)(E) and is required to do nothing more.

Perfect Barrier LLC v. Woodsmart Solutions Inc., 2008 WL 2230192 (N.D. Ind. May 27, 2008 )

Posted in 7th Circuit, Case Blurbs, Cost of Discovery, Cost Shifting, Discovery Requests, Duty to Produce, email, Form of Production, FRCP 34, FRCP 34(b), Magistrate Judge Christopher A. Nuechterlein, N.D. Ind. | Tagged: , | Leave a Comment »