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 . . .

"Say Cheese!": Wisconsin Supreme Court Pictures New E-Discovery Rules . . . TWICE.

Courts are becoming increasingly persnickety when parties fail to discuss e-discovery issues early on in the case, even to the point of imposing sanctions.  The latest railway car attached to this train of thought, can be found in The Cheese State.

Back in January, we reported on the Wisconsin Supreme Court’s public hearing and open administrative conference about the Wisconsin Judicial Council’s petition for an order amending the state rules of civil procedure to deal explicitly with the discovery of electronically stored information (ESI). Those meetings closed with the court asking for a new petition that would rely more heavily on language in the Federal Rules of Civil Procedure, incorporate commentary to the federal rules, and possibly include new substantive provisions, particularly one requiring that parties confer about e-discovery issues early in any proceeding.

The Judicial Council submitted its amended petition in March.

This amended petition responded to the Court’s requests by more closely tracking language in the Federal Rules of Civil Procedure and incorporating, within the Judicial Council’s own notes, large chunks of commentary supplied by the federal Advisory Committee on Civil Rules. The amended petition also included a new provision granting Wisconsin courts discretion to order that parties confer about various discovery problems, including the discovery of ESI.

The Court considered the Council’s amended petition at an open administrative conference on April 28 (video here) and quickly zeroed in on the Council’s new discovery conference provision. The justices voiced unanimous approval for all other provisions in the amended petition. But several justices, led by Justice Annette Ziegler, argued that the Council had not gone far enough to encourage parties to confer at an appropriately early time about e-discovery issues.

The Court ultimately voted 5-2 to adopt the Council’s amended petition but to change the discovery conference provision to require that parties always confer about the discovery of ESI -- although not about discovery issues generally -- unless excused by the court. The Court was unable to hammer out exact language to adopt during the April 28 conference, finding that it needed more time to get the drafting right. But the Court agreed to have the new rules ready for publication this fall.

The e-discovery debate, however, will not end there. The new rules will not be effective until January 2011, and the Court agreed to hold yet another hearing in the fall to receive public commentary, particularly about the discovery conference provision.  The Court may still make additional changes before those rules apply to proceedings in the Wisconsin courts. 

Other states have and will follow suit, not to mention federal courts.   So while marshalling one's ESI arsenal and assessing its contents may seem like a time-consuming task so early on in the case, it is becoming increasingly clear that this must be done.  E-discovery discussions -- which necessitate an understanding of yours or your client's ESI capabilities and contents -- need to occur early on in the case.  Courts are no longer buying excuses to the contrary.