WI Supreme Court Continues to Debate E-Discovery Amendments

          

On July 6, 2010, the Wisconsin Supreme Court set the date for the next and final hearing regarding amendments to the state rules of civil procedure that relate to the discovery of electronically stored information. The hearing will take place on September 30, 2010 at 9:30 a.m. at the State Capitol in Madison. The Court will accept written comments from the public until August 31, 2010. 

By a 4-3 vote, the Court has already adopted amendments to Wis. Stat. §§ 802.10, 804.01, 804.08, 804.09, 804.12 and 805.07 to address e-discovery. However, the amendments are subject to revision following public comment and the hearing on September 30, 2010. The amendments will become effective January 1, 2011. 

As the 4-3 voting split indicates, the Court is not of one mind regarding the amendments. While all of the Justices agree that the rules should be amended to address e-discovery, there are three key issues regarding which the Court remains divided: 

 

(1) whether the rules should require parties to meet and confer on e-discovery at the outset;

(2) whether the rules should include a “claw-back” provision; and

(3) whether the rules should expressly provide for cost-shifting. 

 

Currently, the amendments include a mandatory meet and confer provision regarding e-discovery and do not include claw back or cost shifting provisions.  Under the circumstances, and because the Court is divided, it looks as though the public has a meaningful opportunity not only to be heard, but to affect the ultimate outcome.

In large part, the disagreement between the Justices is based on their varied understandings regarding what cases the rules are most likely to apply to, because not every case involves significant e-discovery.  The dichotomy is as follows:

  • Justices who focus on smaller, less complicated disputes tend to oppose mandatory e-discovery conferences as well as express “claw back” and cost-shifting procedures. 
  • Justices who focus on complex commercial disputes, which frequently involve extremely costly and extensive e-discovery tend to be in favor of mandatory e-discovery conferences, claw back and cost-shifting provisions. 

 Chief Justice Abrahamson has appealed to the public to focus on these particular issues when submitting written comments. As a result, it is worth considering each side of the debate.

 

Mandatory early e-discovery conferences:  Those in favor of an early, mandatory e-discovery conference argue that if the parties confer before discovery, they can reduce the ultimate cost of discovery and head off future disputes before they develop. Those opposed note that the conference is a waste of time in the majority of cases, which are typically small, less complicated disputes in which neither party will request or receive much in the way of e-discovery. Those opposed also note that there is no rule that would prevent parties in complex commercial disputes from meeting and conferring independently in the absence of a rule requiring the parties to meet.  Current vote:  five in favor of this rule, two against (5-2).

 

Claw back provisions:  Those in favor of an express claw back provision note that in cases involving voluminous e-discovery productions, it is extremely expensive and time-consuming for the producing party to review every single document and file prior to production to determine if it contains privileged information. They argue that a claw back provision is necessary to alleviate the producing parties burden by allowing a party who inadvertently produces privileged information to demand its return and prohibit the receiving party from using the privileged information. Those opposed note that an effective claw back rule is both procedural and evidentiary to the extent that it must address whether the privileged information remains privileged despite having been produced. They argue that the claw back rule is best addressed at a later time, when amendments to the rules of evidence can also be considered to avoid inconsistencies between the procedural and evidentiary provisions. Current vote:  three in favor of this rule, four against (3-4).

 

Cost-shifting:  Finally, those in favor of a provision authorizing cost shifting argue that the court should be expressly empowered to make a requesting party pay for the unduly burdensome discovery it seeks. Those opposed only disagree to the extent that they argue that the current rules of civil procedure already authorize the court to require a requesting party to pay for unduly burdensome discovery. They cite Wisconsin case law in support of their position, and note that federal cases provide persuasive authority regarding the circumstances under which cost shifting is appropriate.  Current vote:  three in favor of this rule, four against (3-4).

 

Whether the current distribution of votes will change likely depends on the volume and nature of written comments the Court receives before August 31, 2010, as well as the persuasiveness of any argument the Court hears at the public hearing on September 30, 2010. 

 

Let the arguments begin . . .

Google to the (E-Discovery) Rescue?

Recently I came across a doubleclick.com digital marketing piece touting Google's latest search technology, Google Search Appliance 6.0. The inviting web ad promised:  "Google brings Findability to Enterprise Search".

The list of oohs and aahs includes:

  • Dynamic Scalability to thousands, millions, even billions of documents.
  • Linking multiple search engines (federated searches) separated across departments or geographies to provide a unified set of results.
  • Syndicated searches of up to 30 million documents.
  • Fine-tuning relevancy by using latest technologies in search algorithm and search result ranking.
  • Customizable security.
  • User-centric search enhancements such as "User-Added Results" and "Query Suggestions."

While the new Google Search Appliance (GSA) represents another hopeful step towards the Holy Grail of Search, it is also a potential antidote to the current state of e-discovery -- at least from a strategic perspective.  The cost of litigation appears to be at a breaking point where containment hinges on effective ESI searches and collaborative e-discovery maneuvers.  Although Google's search technology may be primarily designed for Intra/Extranet implementations, GSA could also serve to reduce litigation costs by helping lawyers cull through exabytes of electronically stored information.

Finding an efficient means for culling through those exabytes cannot happen a moment too soon.  Electronic discovery not only increases the costs of litigation, it also diminishes the legal profession. 

According to a 2008 American Judicature Society (AJS) report, discovery abuse in civil cases presents a significant problem.  Indeed, nearly half of survey respondents (45 percent) indicate they believe that discovery is abused in every civil case.  Moreover, 71 percent agree that attorneys use discovery as a tool to force settlement.  An astounding 81 percent of AJS report survey respondents stated that their firms turn away cases when it is not cost effective to handle them, and 83 percent said that litigation costs drive cases to settle that deserve to be tried on the merits. 

The end result is that some deserving cases are not brought, and some meritless cases are settled out of court -- not because of the strength of the parties’ claims, but instead because the cost of pursuing or defending those claims fails a rational cost-benefit analysis.  According to Ralph Losey, e-discovery has become a threat to the U.S. legal system.  And that threat is pernicious and spreading.

In his e-Discovery Team blog, Losey -- himself a trial lawyer -- asserts that trial lawyers wrongly blame runaway e-discovery costs on poor rules, laws, and judges.  According to Losey, the true cause of escalating e-discovery costs is the legal profession's failure to keep pace with the dizzying advances of new technologies.

In my opinion, there's plenty of blame to go around when it comes to e-discovery and the rising cost of litigation.  Among other things, there is lack of knowledge on e-discovery issues and technologies; poor planning, selection and application of appropriate technologies to initiate effective searches; failure to collaborate and communicate effectively among counsel and IT staff; and, in particularly eggregious situations, wholesale adoption of the ostrich head-in-sand approach to e-discovery.

One need not become a techie in order to be an effective 21st Century litigator.  But knowing when and where to seek help with respect to e-discovery issues could save you and your clients a lot of headaches and heartbreaks down the road. 

5 days of searching ESI - $250,000.
4 days of filtering search results - $150,000. 
10 rounds of sparring between parties - $300,000.
Google finding the right information - Priceless.