2008 E-Discovery Year In Review

It's that time of the year again .... chilly temperatures, frenzied shopping, offices full of high-calorie treats, and, my personal favorite, year-end "year in review" and "top" lists.  Kroll Ontrack contributes an interesting early entry to the annual roll with its descriptively-titled, "Year In Review: Courts Unsympathetic to Electronic Discovery Ignorance or Misconduct"

Kroll's sobering survey of the approximately 138 reported opinions on electronic discovery issue leaves something rather more ominous than visions of sugarplums dancing in one's head, revealing that over half of those opinions addressed sanctions, data production, or preservation and spoliation issues, with a whopping 25% involving some type of court-ordered sanctions for e-discovery issues.  Kroll also offers its "top five" 2008 cases demonstrating both the breadth of material available through e-discovery and courts' growing intolerance for e-discovery mishaps:

  • In Flagg v. City of Detroit, 2008 WL 3895470 (E.D. Mich. Aug. 22, 2008), U.S. District Judge Gerald Rosen rejected the city defendants' argument that the court's previous order - compelling the production of text messages sent between City employees on city-issued text messaging devices - violated the Stored Communications Act ("SCA").  Although the SCA does not authorize a service provider to disclose electronic communications in response to a subpoena or court order, Judge Rosen found that the law does not override a defendant's obligation under Federal Rule of Civil Procedure 34 to produce relevant, nonprivileged electronic communications in their possession, custody or control.  Rosen reasoned that defendants were both able and obligated to give their consent to SkyTel, the service provider that stored the text messages, to retrieve those messages, which the city must then produce. 
  • U.S Magistrate Judge Paul Grimm contributes once again to the body of e-discovery casleaw with Victor Stanley, Inc. v. Creative Pipe, Inc., 2008 WL 2221841 (D. Md. May 29, 2008), and sheds some light on the "reasonable precautions" parties must take to prevent inadvertent disclosure.  Judge Grimm found that defendants had waived the attorney-client and work product privileges as to 165 electronic documents inadvertently produced in discovery by failing to take several measures that could have prevented the waiver, including a clawback agreement the disclosing party voluntarily abandoned and compliance with The Sedona Conference® best practices.
  • The effectiveness of electronic search terms and methods may be a growing area for expert testimony in both civil and criminal cases, per United States v. O'Keefe, 2008 WL 449729 (D.D.C. Feb. 18, 2008).  Applying the civil e-discovery rules to a criminal prosecution, Magistrate Judge John M. Facciola ordered the parties to collaborate to reach an agreement on production after the co-defendant filed a motion to compel claiming the government failed to meet its discovery obligations.  Judge Facciola further suggested that any judicial review of search methods may demand the services of an expert witness, observing that lawyers and judges who attempt to determine whether search terms are effective venture "where angels fear to tread."
  • Another Judge Facciola decision makes Kroll's top-five list:  Peskoff v. Faber, 2008 WL 2649506 (D.D.C. July 7, 2008).  Peskoff involved an ongoing discovery dispute involving Faber's failure to produce certain emails without explaining why they were not produced or what efforts he had undertaken to locate them.  Finding that Faber's search had been inadequate, the court orderd the parties to seek bids from forensic computer technicians to determine whether the cost of searching for, restoring, and converting the emails from Faber's computers was justified.  Since the court found that defendant's inadequate search efforts, failure to preserve ESI, and overall unwillingness to take "discovery obligations seriously" had caused the need for forensic examination, the court refused to shift costs.
  • Last, but certainly not least, my personal favorite e-discovery cautionary tale of 2008 goes to Keithley v. Homestore.com, Inc., 2008 WL 3833384 (N.D.Cal. Aug. 12, 2008).  A "lackidasical attitude" towards e-discovery doesn't pay, as the defendant in patent infringement litigation learned when the court awarded plaintiffs their attorney fees, expert witness fees and costs that could total over $1 million for re-doing tasks made necessary by defendants’ misconduct and ordered a mandatory adverse inference jury instruction against defendants.  Why?  A litany of e-discovery misconduct that the court described as "among the most egregious this court has ever seen," including:  
    • a defendant employee who "suddenly remembered" after well over a year of discovery demands, court orders and sanctions hearings that he had stored a crashed hard drive that contained some of the source code sought at his home;
    • computerized reports that defendants claimed "did not exist" suddenly surfacing in a hard drive under a directory labeled "reports";
    • defendants' failure to remind technical personnel of the need to preserve crucial source code information, resulting in the loss of backup information when the backup tapes for a failed computer continued to be overwritten;
    • defendants failure to ask the person responsible for transferring files to a new source code control system about the availability of source code until after a sanctions hearing.

Fodder for some 2009 e-discovery resolutions, indeed!

What U Txt Can Hurt U OMG!

It would appear that Detroit public officials have a real problem with text messages.  In addition to the current indictment against mayor Kwame Kilpatrick involving his alleged cover-up of text messages linking him romantically with his former chief of staff, text messages play a central role in another current case with Kilpatrick ties, and were the subject of a recent court decision that outlined how they would be disclosed.

The problems began with allegations of a 2002 party at the Kilpatrick's mansion involving exotic dancers.  When one of the dancers who claimed that she was at the party was shot to death in 2003, her family filed a $150 million lawsuit against the city.  The family claimed that the shooting was an attempt to cover up the dancer's role in the party, and further claimed that a Detroit police officer was the shooter.  The family issued two subpoenas to SkyTel, which supplied the city's text messaging devices.  The subpoenas sought text messages to and from all city officials and employees on the night of the shooting and text messages from a list of 34 city officials for certain periods between 2002 and 2007.  The court allowed discovery of the text messages from the night of the shooting, but narrowed the second request.

The court issued an order on March 20, 2008 setting forth a procedure for discovery of the text messages.  The procedure seems well-reasoned, and strikes a sensible balance between the family's right to access information relevant to its claim, as well as the city's interest in maintaining evidentiary privileges and protecting confidentiality in what is, obviously, a very sensitive matter.

The court's order sets forth the following steps:

1.  The city must provide Skytel with the PIN number used by every city employee so that Skytel can access the accounts.

2.  Next, the text messages will be turned over to magistrate judges (on CDs, not in paper format, the court is careful to note) for review and an initial determination as to discoverability under Federal Rule of Civil Procedure 26(b)(1).  The magistrate judges will also have the authority to set reasonable limits on the scope of discovery sought.

3.  After the magistrate judges issue their initial determination as to discoverability, the city will have a chance to make any objections, which will be ruled upon by the district court judge.

4.  Any text messages that the court orders produced will be maintained subject to a stipulated protective order, and returned to Skytel at the conclusion of the case.

This sounds simple, but is sure to lead to many squabbles given the high stakes of the proceeding.  We will keep track of developments to see how the judge's procedure plays out.

Text Messages Live Forever? Or no?

Interesting Slate article about some of the nuts and bolts behind retention of text messages. . . how long they are stored on your phone, how long your wireless carrier will store them, and how your corporate record retention policies might affect those issues (as Detroit Mayor Kwame Kilpatrick recently learned the hard way).