The Corporate "Know It All"

Our mothers always told us that “no one likes a know-it-all.” However, in today’s litigation environment, where electronic discovery and authentication of data have become important and too often dangerous, a know-it-all is exactly what companies facing litigation need. As Jonathan Sablone points out in his article, “Not Your Father’s Keeper Deposition”, litigators are now routinely using Rule 30(b)(6) depositions as a tool to authenticate data, determine whether another party has met its discovery burden and “to hijack entire cases”. See “Not Your Father’s Keeper Deposition."  As a result, as Sablone accurately points out, the choice of the designated 30(b)(6) witness in the context of electronic and e-discovery is a decision that should be taken very seriously. The failure to do so can not only lead to unnecessary time and expense but, more importantly, can potentially endanger a party’s case. 

Rule 30(b)(6) depositions allow an attorney to notice the deposition of an entity and the burden then shifts to the entity to designate one or more persons to testify on its behalf about the matters at issue. An entity can designate one person or it can designate multiple people and specify the matters upon which each person will testify. With matters relating to electronic records and e-discovery, savvy companies will take the time and expend the effort required to designate one or more witnesses who can testify about the relevant matters in a manner that is to the company’s advantage. This may be one “know-it-all” or several, each of whom is the “know-it-all” about a particular subject. Rule 30(b)(6) requires the witness to testify about information known or reasonably available to the organization. In other words, first hand knowledge of a matter is not required. This means that the company “know-it-all” can be prepped, thereby allowing a company to designate a person or persons that will make a “good witness.” 

Quality Not Quantity

The adage that "quality, not quantity matters" certainly applies to the maintenance of business records. Businesses often devote numerous hours to developing lengthy schedules defining what records must be kept and for how long. While the development of a comprehensive schedule is important, the quality of the records to be maintained is just as important. Records must be of a sufficient quality to allow companies to defend against legal claims.

One important quality consideration is how to store the records. Records should be stored so that records can be easily located when necessary to respond to a discovery request. Failure to do so can result in burdensome costs.

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Financial Crisis - Do You Know Where Your Records Are?

With the meltdown of the world's financial markets over the last few days, it should come as a shock to no one that pension holders, stock owners, and state governments are suing or considering lawsuits against various actors in the financial crisis, including investment banks, bond ratings agencies, and agencies such as Fannie Mae and Freddie Mac.

As noted in this article in Information Weekly, these pending and proposed lawsuits are going to require financial services companies to produce reams of e-mail and other communications, not to mention transaction records and other financial data.  Is your company ready to deal with the production of its electronically stored information?  If you were asked tomorrow to do so, could you? 

The Problem of Reviewing Electronic Data

In a recent post on the Security Blog of ComputerWorld, a corporate security manager (i.e. an individual on the IT side of the aisle) lamented about the data retention policies at his company. Pointing out that much more data is currently being retained electronically than what is mandated by law, he noted the tremendous manpower that might be required to search through the vast amounts of this data if the need ever arose. As an alternative to the problem of over-retention the blogger (whose real identity was "disguised for obvious reasons") suggested a turning back of the technological clock, keeping paper records and turning the lawyers loose to sift through piles of paperwork.

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Electronic Communication: Not just e-mail anymore

When a preservation order specifies that "electronic communication" is to be preserved,  there is a common misconception that this phrase refers only to e-mail correspondence.  Not so, my friends.  There are a bevy of other versions of electronic communication that are potentially relevant to the standard forensic collection process.

They include:

  • Instant message communications (Yahoo! Messenger, MSN Messenger, Google Talk, AOL Instant Messenger and Skype, to name a few.)
  • SMS or Text Messaging (not just for teenagers anymore.)
  • Voice over Internet Protocol (VoIP)
  • Fax communications directly sent and received on a company's computer
Companies should be sure to make their computer forensic expert aware of what third party software has been installed and used on company computers so that all relevant electronic communications can be secured and preserved. For a full analysis of the importance of securing all types of electronic communication, see this helpful article from Metropolitan Corporate Counsel.

Ephemeral Data -- What is it and Why Does it Matter?

Much of the data stored on computers, such as the data stored in random access memory (RAM) and internet caches, is temporary and "ephemeral". Because these temporary, transient files are deleted as often as every few hours, it would seem that there would not be a duty to preserve them.

However, in Columbia Pictures Indus. Inc. v. Bunnell, 2007 U.S. Dist. LEXIS 46364 (C.D. Cal. June 19, 2007) Magistrate Judge Jacqueline Choolijan, following Ninth Circuit precedent, ordered the defendants to preserve data "stored" in RAM.  The court held that the server log data (IP addresses, etc.) stored in RAM was extremely relevant stored information under Rule 34 of the Federal Rules of Civil Procedure.
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