E-Discovery Bytes : E-Discovery Lawyer & Attorney : Quarles & Brady Law Firm : Electronic Discovery, Data Preservation, Conversion, Computer Forensics

The debates concerning President Obama’s plan to computerize medical records within 5 years have tended to focus on a few key issues. Those in favor of the plan suggest that it will create jobs, improve treatment, reduce errors, and reduce costs. Those opposed argue that it will be too costly and burdensome to implement and that it will be compromise the security of patients’ private information.  But what about the effect on e-discovery?

As Craig Ball notes on Law Technology News’ EDD Update blog, "medical records are evidence." They are often sought and produced by parties to all kinds of lawsuits, including cases involving malpractice, personal injury, insurance disputes, employment law issues and disability claims. Because medical records are evidence, digital medical records will be subject to the rules and procedures regarding electronic discovery.

If you don’t immediately catch the significance of the proposed change in terms of litigation expenses consider this: Assuming you knew what you were looking for, how long would it take you to read several boxes full of your doctor’s hand-written notes written on whatever form your doctor happened to be using at the time? Compare that to the amount of time it would take you to run a keyword search of a single field (e.g. “Prescriptions”) of several uniform digital forms. If you were billed for the time spent running the searches, for which would you rather pay?

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Not having knowledgeable e-discovery counsel can be costly -- a lesson the Office of Federal Housing Enterprise Oversight (OFHEO) found out the hard way.  Failure to devise a comprehensive plan for responding to a third party subpoena seeking ESI ended up costing the agency over $6 million to comply with a court order, more than 9% of the agency's entire annual budget. In a rare Court of Appeals decision, In re Fannie Mae Securities Litigation, 552 F.3d 814 (D.C. Cir. January 6, 2009), the D.C. Court of Appeals affirmed the district court's order holding the OFHEO in contempt for failing to comply with a discovery deadline to which it agreed.  But it's a bit more complicated than that.

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Hurricane Katrina was the storm of the century down in the Ninth Ward, but in downtown New Orleans, a different kind of storm is brewing. Just in time for the February 24th Mardi Gras celebration, the party in City Hall has come to an abrupt halt, and the Krewe of Nagin has brought Trouble to River City. 

The city’s records retention policy and state public records law requires that all email and public records must be preserved. In fact, under the "enforcement" section of the Nagin administration's recommendations for preserving e-mail, the city's technology office suggested that "any employee found to have violated this policy might be subject to disciplinary action, up to and including termination of employment." Moreover, violations of the state law requiring the emails to be kept for three years is punishable by as long as five years in prison and fines up to $5,000.

Can you say “Uh-oh?” On February 19, 2009, Frank Donze reported in the New Orleans Times-Picayune, http://www.nola.com/news/index.ssf/2009/02/email_deletions_violate_nagins.html, that the Mayor’s office has disregarded its own policy, by deleting six months of the Mayor’s own emails, totaling over 1,500. The Nagin administration's only comment came from the city attorney, Penya Moses-Fields, who blamed the destruction of e-mail on "server storage and capacity problems, which have temporarily limited the city's capabilities to retain employee e-mails for any extended period of time."

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It's official. The Big Blue (a/k/a IBM) joined other technology behemoths such as EMC, Cisco Systems, and Sun Microsystems by creating a Cloud Computing Division to handle the increasingly complex digital information environment, as reported by eWeek.

Not only is this a significant business development for technology companies that span the globe, but it is also a recognition of the importance of a single point of contact in terms of managing data centers to supply infrastructure for cloud-type services.

Although cloud computing is as pervasive and complex as the classification of clouds in atmospheric terms, it can be summed up as computing from anywhere at any time, as IBM articulated in its overview of cloud computing. Despite this massive web of interconnectivity, it can also be cohesive, if it is well-managed.

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The reality of cost-shifting is that it is not always available to a responding party. In order to manage risk associated with the cost of electronic discovery, legal counsel should be aware of circumstances where responding parties have received the benefit of a cost-shifting analysis and conversely, where it has been denied. 

Courts do not want responding parties to pay for a plaintiff's fishing expedition. Therefore, courts may shift costs to the requesting party as an incentive to narrowly tailor the discovery request where there is a low likelihood that discovery will produce relevant evidence. Delta Financial Corp. v. Morrison, 13 Misc. 3d 604, 611-12, 819 N.Y.S.2d 908 (Sup 2006) (ordering requesting party to pay expenses of searching restored backup tapes for e-mail and electronic documents because the Court was "not entirely convinced that relevant and responsive documents would be found").

Courts employ cost shifting to protect the producing party from undue burden. Therefore, courts weigh the benefit of discovery versus the burden under the proportionality test of Rule 26(b)(2)(C). Thus, even where the plaintiff is not fishing and the evidence will be beneficial to disposing of the issues, courts may limit discovery or employ cost-shifting if the burden to produce the requested data is disproportionately higher than the benefit. Christian v. Central Record Service, 2007 WL 3094513 (W.D. Ark. 2007) (relevant evidence was precluded from discovery when the expense of discovery outweighed the benefit).       

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E-discovery requests often focus on “tangible” data that exists on physical storage devices, such as e-mail messages, documents, pictures, music, video, sound clips, or application program files. But what about data that is not so tangible, such as elusively cached or transient files that exist only in integrated circuitries such as Random Access Memory (RAM)?  Is that data discoverable? And is there a duty to preserve? Courts appear to say YES, as long as a litigating party has requested it.

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Ah, l’amour. With Valentine’s Day upon us, our thoughts turn to hearts, flowers, chocolate and….texting? When George Bernard Shaw said, “The perfect love affair is one which is conducted entirely by post,” one doubts that Mr. Shaw could have ever imagined that the “post” would evolve to allow electronic, nearly instantaneous, communication about affairs of the heart, nor is it likely he would consider the dangers of electronic communication romantic. 

One couple’s use of text messages to communicate during their affair led to public humiliation, fines and jail time. Tresa Baldas, writing in the National Law Journal, reports that on Tuesday, January 7, Christine Beatty - the former top aide to Detroit’s ex-mayor Kwame Kilpatrick - was sentenced to 120 days in jail and ordered to pay $100,000 in restitution for her role in a text-messaging scandal that put her boss - and alleged lover - behind bars. Mayor Kilpatrick’s administration had been accused of retaliation against police officers who discovered Ms. Beatty’s and Mayor Kilpatrick’s affair. Text messages between the two were admitted into evidence and proved that Kilpatrick and Beatty had lied about their affair and that they sought to mislead the jury regarding the retaliatory actions taken against the police officers. The trial cost the City of Detroit $8.4 million, and both Beatty and Kilpatrick were ultimately charged with felonies including perjury and obstruction of justice. Their text messages were published in the Detroit Free Press.

Text messaging is discoverable, as lamentably learned late by the amorous couple. If it’s something you wouldn’t want your mother to see - or wouldn’t want published in the Detroit Free Press or anywhere else - think twice before texting it.   As Earl Warren said, “The fantastic advances in the field of electronic communication constitute a greater danger to the privacy of the individual.” Don’t be the one whose secrets in the area of “l’amour” are front page news, fodder for the water cooler gossip groupies, or worse - a source of humiliation and liability.

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In 1969, when Mario Puzo published his novel “The Godfather,” his line “A lawyer with his briefcase can steal more than a hundred men with guns” became highly quoted and recognized because of the innate truth it contained: it’s easier to rob a company through information than through violence.

He could not have imagined that, just forty years later, enough information to take over, bring down, or steal from a company could be contained on a device the size of a pack of gum. Flash drives have made it possible for corporate espionage to reach new heights, and for any disgruntled employee - from the receptionist to the president of the company - to succumb to temptation, download and walk away with the company’s data in a format so small that it can be hung on a keychain. If not accounted for in a document retention policy, flash drives present a significant risk of comprising the integrity and negating the purpose of a document retention plan. 

In a posting called “Deter the Use of Flash Drives to Avoid Corporate Espionage” by James Koopman on the DCIG website, Koopman says,

The portability and high capacity of flash drives is creating headaches for many companies. The Net is swarming with stories of the ill-use, illegal activities, and security concerns as more and more of these devices are lost and stolen or used to steal sensitive information.

The site links to reports on the theft or loss of flash drives containing information as diverse as military secrets, patient data, and confidential child welfare cases, all because the drives are convenient, easy to use, take up no space, are inexpensive and easily obtainable in any electronics store.

What all this means to legal departments, of course, is that flash drives have to be accounted for when complying with record retention policies, and in planning electronic document production for litigation purposes. In some environments - the Pentagon being a notable example ("Pentagon Bans Flash Drives"), flash drives have been outlawed entirely due to security concerns.  

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