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Doug Austin

Defendants Sanctioned, Sort Of, for Failure to Preserve Text Messages – eDiscovery Case Law

In Christou v. Beatport, LLC, Civil Action No. 10-cv-02912-RBJ-KMT, (D. Colo. Jan. 23, 2013), Colorado District Judge R. Brooke Jackson ruled that the plaintiffs could introduce evidence at trial to show the defendants failure to preserve text messages after the key defendant’s iPhone was lost.  However, the judge also ruled that the defendants could present “evidence in explanation…and argue that no adverse inference should be drawn”.

The defendant had worked for the plaintiff in his Denver nightclubs booking disc jockeys and received both financial and promotional support from the plaintiff in launching an online marketplace (Beatport) for promoting and selling Electronic Dance Music.  Beatport became enormously successful and grew to become the largest online site that caters essentially exclusively to producers and consumers of Electronic Dance Music.  When the plaintiff left the defendant’s employment, he went on to found his own competing nightclub in Denver and the plaintiff claimed that the defendant has been threatening A-List DJ’s that their tracks will not be promoted on Beatport if they perform in the plaintiff’s clubs.

When the case was filed, plaintiffs served a litigation hold letter on the defendants, directing them to preserve several categories of documents, including text messages. However, defendants took no steps to preserve the text messages on the plaintiff’s iPhone, but did not produce any text messages in response to plaintiffs’ first discovery requests served in May 2011. The defendant indicated that he lost his iPhone in August 2011, and with it any text messages saved on it. Plaintiffs contended that this “spoliation” of evidence should be sanctioned by an adverse jury instruction.  The defendants noted that Roulier testified that he did not use text messages to book DJ’s and argued that “it is sheer speculation” that his text messages contained relevant evidence, also noting that they responded fully to the May 2011 discovery, indicating that there was nothing responsive in the text messages.

Noting that the defendant’s testimony that he did not use text messages to book DJ’s was “hardly proof that his text messages did not contain relevant evidence”, Judge Jackson also noted that “although defendants state that defendants ‘found no responsive text messages,’ they do not indicate that defense counsel reviewed Mr. Roulier’s text messages”.

Noting that “Spoliation sanctions are proper when ‘(1) a party has a duty to preserve evidence because it knew, or should have known, that litigation was imminent, and (2) the adverse party was prejudiced by the destruction of the evidence.’”, Judge Jackson stated that “Defendants had a duty to preserve Mr. Roulier’s text messages as potential evidence, but they did not do it. Those text messages, few as they might have been, should have been preserved and either provided to the plaintiffs or potentially made the subject of further proceedings before the Court.”

Nonetheless, Judge Jackson found “no basis to assume that the loss of the phone was other than accidental, or that the failure to preserve the text messages was other than negligent” – therefore, the judge found an adverse jury instruction to be “too harsh”.  Instead, Judge Jackson ordered that “plaintiffs will be permitted to introduce evidence at trial…of the litigation hold letter” and defendant’s “failure to preserve Mr. Roulier’s text messages”. The defendants were allowed to “present evidence in explanation, assuming of course that the evidence is otherwise admissible, and argue that no adverse inference should be drawn.”

So, what do you think?  Should the sanction have been harsher?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Four More Tips to Quash the Cost of eDiscovery – eDiscovery Best Practices

Thursday, we covered the first four tips from Craig Ball’s informative post on his blog (Ball in your Court) entitled Eight Tips to Quash the Cost of E-Discovery with tips on saving eDiscovery costs.  Today, we’ll discuss the last four tips.

5. Test your Methods and Know your ESI: Craig says that “Staggering sums are spent in e-discovery to collect and review data that would never have been collected if only someone had run a small scale test before deploying an enterprise search”.  Knowing your ESI will, as Craig notes, “narrow the scope of collection and review with consequent cost savings”.  In one of the posts on our very first day of the blog, I relayed an actual example from a client regarding a search that included a wildcard of “min*” to retrieve variations like “mine”, “mines” and “mining”.  Because there are 269 words in the English language that begin with “min”, that overly broad search retrieved over 300,000 files with hits in an enterprise-wide search.  Unfortunately, the client had already agreed to the search term before finding that out, which resulted in considerable negotiation (and embarrassment) to get the other side to agree to modify the term.  That’s why it’s always a good idea to test your searches before the meet and confer.  The better you know your ESI, the more you save.

6. Use Good Tools: Craig provides another great analogy in observing that “If you needed to dig a big hole, you wouldn’t use a teaspoon, nor would you hire a hundred people with teaspoons.  You’d use the right power tool and a skilled operator.”  Collection and review tools must fit your requirements and workflow, so, guess what?  You need to understand those requirements and your workflow to pick the right tool.  If you’re putting together a wooden table, you don’t have to learn how to operate a blowtorch if all you need is a hammer and some nails, or a screwdriver and some screws for the job.  The better that the tools fit your workflow, the more you save.

7. Communicate and Cooperate: Craig says that “Much of the waste in e-discovery grows out of apprehension and uncertainty.  Litigants often over-collect and over-review, preferring to spend more than necessary instead of giving the transparency needed to secure a crucial concession on scope or methodology”.  A big part of communication and cooperation, at least in Federal cases, is the Rule 26(f) conference (which is also known as the “meet and confer”, here are two posts on the subject).  The more straightforward you make discovery through communication and cooperation, the more you save.

8. Price is What the Seller Accepts: Craig notes that there is much “pliant pricing” for eDiscovery tools and services and relayed an example where a vendor initially quoted $43.5 million to complete a large expedited project, only to drop that quote all the way down to $3.5 million after some haggling.  Yes, it’s important to shop around.  It’s also important to be able to know the costs going in, through predictable pricing.  If you have 10 gigabytes or 1 terabyte of data, providers should be able to tell you exactly what it will cost to collect, process, load and host that data.  And, it’s always good if the provider will let you try their tools for free, on your actual data, so you know whether those tools are worth the price.  The more predictable price and value of the tools and services are, the more you save.

So, what do you think?  What are you doing to keep eDiscovery costs down?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Eight Tips to Quash the Cost of eDiscovery – eDiscovery Best Practices

By now, Craig Ball needs no introduction our readers as he has been a thought leader interview participant for the past three years.  Two years ago, we published his interview in a single post, his interview last year was split into a two part series and this year’s interview was split into a three part series.  Perhaps next year, I will be lucky enough to interview him for an hour and we can simply have a five-part “Ball Week” (like the Discovery Channel has “Shark Week”).  Hmmm…

Regardless, I’m a regular reader of his blog, Ball in your Court, as well, and, last week, he published a very informative post entitled Eight Tips to Quash the Cost of E-Discovery with tips on saving eDiscovery costs.  I thought we would cover those tips here, with some commentary:

  1. Eliminate Waste: Craig notes that “irrational fears [that] flow from lack of familiarity with systems, tools and techniques that achieve better outcomes at lower cost” results in waste.  Over-preservation and over-collection of ESI, conversion of ESI, failing to deduplicate and reviewing unnecessary files all drive the cost up.  Last September, we ran a post regarding quality control and making sure the numbers add up when you subtract filtered, NIST/system, exception, duplicate and culled (during searching) files from the collected total.  In that somewhat hypothetical example based on Enron data sets, after removing those files, only 17% of the collected files were actually reviewed (which, in many cases, would still be too high a percentage).  The less number of files that require attorney “eyes on”, the more you save.
  2. Reduce Redundancy and Fragmentation: While, according to the Compliance, Governance and Oversight Council (CGOC), information volume in most organizations doubles every 18-24 months, Craig points out that “human beings don’t create that much more unique information; they mostly make more copies of the same information and break it into smaller pieces.”  Insanity is doing the same thing over and over and expecting different results and insane review is reviewing the same documents over and over and (potentially) getting different results, which is not only inefficient, but could lead to inconsistencies and even inadvertent disclosures.  Most collections not only contain exact duplicates in the exact format (which can identified through hash-based deduplication), but also “near” duplicates that include the same content in different file formats (and at different sizes) or portions of the content in eMail threads.  The less duplicative content that requires review, the more you save.
  3. Don’t Convert ESI: In addition to noting the pitfalls of converting ESI to page-like image formats like TIFF, Craig also wrote a post about it, entitled Are They Trying to Screw Me? (discussed in this blog here).  ‘Nuff said.  The less ESI you convert, the more you save.
  4. Review Rationally: Craig discussed a couple of irrational approaches to review, including reviewing attachments without hits when the eMail has been determined to be non-responsive and the tendency to “treat information in any form from any source as requiring privilege review when even a dollop of thought would make clear that not all forms or sources of ESI are created equal when it comes to their potential to hold privileged content”.  For the latter, he advocates using technology to “isolate privileged content” as well as clawback agreements and Federal Rule of Evidence 502 for protection against inadvertent disclosure.  It’s also important to be able to adjust during the review process if certain groups of documents are identified as needing to be excluded or handled differently, such as the “All Rights Reserved” documents that I previously referenced in the “oil” AND “rights” search example.  The more intelligent the review process, the more you save.

There is too much to say about these eight tips to limit to one blog post, so on Monday (after the Good Friday holiday) we’ll cover tips 5 through 8.  The waiting is the hardest part.

So, what do you think?  What are you doing to keep eDiscovery costs down?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Adam Losey of IT-Lex.org – eDiscovery Trends, Part 2

During our recently concluded thought leader interview series, I had intended to line up at least one more interview – with Adam Losey, president and editor-in-chief of IT-Lex.org, a technology law not-for-profit educational and literary organization and an attorney at Foley & Lardner LLP.  Adam also served as an adjunct professor at Columbia University, where he taught electronic discovery as part of Columbia’s Information and Digital Resource Management Master’s Program.  Under the idea of “better late than never”, I was finally able to speak to Adam and get his thoughts on various eDiscovery topics.  Enjoy!  🙂

Like his dad, Ralph Losey, Adam has a lot to say.  Yesterday was part 1 of the interview.  Here is part 2.

What are you working on that you’d like our readers to know about?

At IT-Lex, we have a cash prize writing competition.  The deadline is May 1.  The winners not only receive $5000, $1000 and $500 cash prizes, but they also will be published in an academic journal that we will begin to publish from the top three articles and other submissions.  The winners also become members of IT-Lex, if they are willing to do the accompanying work.  We have Friends, Partners and Members.  Anybody can be a Friend of IT-Lex for free by registering, which gives you discounts on our conference, on partner products (if they wish to offer them).  You also get the bi-weekly email blast, you can download the journal, and you can watch our videos.  It’s all free.  Our Partners support us financially and they get advertising rights for that.

But, Members are really the core of the organization.  You can’t buy membership, there’s no cost associated with it – you just have to agree to work, have the necessary credentials, and help drive our not-for-profit mission.  There are no honorary memberships.  It includes people like Craig Ball and Jay Grenig at Marquette Law, Maura Grossman, Bill Hamilton, Ron Hedges, Browning Marean, etc.  It’s a bunch of folks that are pretty well established and everybody has agreed to take on a job.  It’s similar to a law review setup – we have managing articles, research and symposium departments.  And, they handle a typical law review process in screening articles that we get for the competition.  But, the big “carrot” that I’m hoping for the winners isn’t the money, it’s receiving an invitation to become a member.  So, they get to join a group of well known, well learned technology lawyers and collaborate academically with them and that should help those winners “kick start” their careers.  You can call us the technology law Kickstarter.  Winners also get to present at our first annual conference, called Innovate, on October 17 and 18 in Orlando.  We’re capping attendance at 200.  There will be quite a group of judges and eDiscovery experts there.  There will be some topics that you don’t typically see at most eDiscovery conferences and the winners of the writing competition will get to present their paper at a panel session.

Thanks, Adam, for participating in the interview!

And to the readers, as always, please share any comments you might have or if you’d like to know more about a particular topic!

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

 

Adam Losey of IT-Lex.org – eDiscovery Trends, Part 1

During our recently concluded thought leader interview series, I had intended to line up at least one more interview – with Adam Losey, president and editor-in-chief of IT-Lex.org, a technology law not-for-profit educational and literary organization and an attorney at Foley & Lardner LLP.  Adam also served as an adjunct professor at Columbia University, where he taught electronic discovery as part of Columbia’s Information and Digital Resource Management Master’s Program.  Under the idea of “better late than never”, I was finally able to speak to Adam and get his thoughts on various eDiscovery topics.  Enjoy!  🙂

Like his dad, Ralph Losey, Adam has a lot to say.  So, today is part 1 of the interview.  Part 2 will appear tomorrow.

What were your general observations about LTNY this year and how it fits into emerging trends?

Well, I’d never been to a LegalTech before, so I saw it with “virgin eyes”, I guess you could say.  It was very busy and a bit overwhelming, because there is almost no way you can do everything you want to do there.  My overall impression is that it was very well done.  Everybody at ALM in setting it up, all of the booths set up by the vendors – it was just very, very well done and, frankly, reinforces the idea of how much money is in this industry.  That there would be an event of that size and so much of the effort and money put into it was a very palpable representation of the prevalence of the eDiscovery and legal technology industry that I hadn’t seen before.  That’s my general overview.

Specifically, I was a little surprised that a lot more of the vendors don’t turn over the controls to attendees more.  I wrote an article in Law Technology News (10 Tips for LegalTech Vendors, which was discussed in this blog here) and, in it, I discuss how I think that most vendors could use the time more productively by getting you to use the tool that they have instead of talking about it generally.  My real goal for the show was to play with a lot of these tools and my expectation was that everyone would have tools available to “click around” in.  But, I was wrong.  While some vendors did, most did not.  I would like to see more vendors in the future with terminals with something like the Enron data set that is widely used and have the tool set up where you can just “have at it” and play with it.

Of course, I’m a computer dude, I’ve built computers for fun and I did some basic programming, so you can put me in front of something and I can figure it out fairly quickly.  I can understand that it can be dangerous with a lot of folks to “plop” them in front of an interface and expect them to figure it out with no training.  Then again, that should be the goal of anybody’s product, to be so intuitive that even somebody that’s not familiar with it can “plop” in front of it and get going with minimal guidance.  Honestly, I don’t understand how you can make a good decision without test driving; otherwise, if you just listen to a general spiel, everyone will give you the same spiel.  No one is going to sit you down and say “my product is terrible, don’t buy my product”.  You can hear about a great software solution or technology, the PowerPoint looks great, the sales people are wonderful and the price is right, but nobody really vets it thoroughly and you wind up being very disappointed.  The day-to-day end users need to be part of the process in figuring out what they are going to use.

If last year’s “next big thing” was the emergence of predictive coding, what do you feel is this year’s “next big thing”?

From reading the news and talking with colleagues, I have a “macro” thought and some “micro” thoughts, which are mostly anecdotal from my personal experience.  My “macro” thought is a continuation of the same, more acceptance rather than introduction of the use of predictive coding (or technology assisted review, computer assisted review, whatever you want to call it).

In addition, I think that there is going to be a lot more emphasis on information security.  Anecdotally, you see a lot of data breaches and people are starting to take it pretty seriously.  I would include information security and privacy in the realm of eDiscovery even though many wouldn’t.  But, you run the risk of stepping on a really big landmine if you don’t have somebody looking out for you on that end, doing everything from making sure you comply with the CAN-SPAM act to making sure you’re meeting the data security requirements in the Gramm-Leach-Bliley Act.  Folks are starting to realize that there are significant financial consequences for not doing it right, such as getting sued.  Here’s a good example.  You’re recording this interview and I gave you consent to do so, but if you were recording it without consent in California, I would have a cause of action against you (according to the California Invasion of Privacy Act) where I could recover a significant amount of money without showing any damages, just because they have a specific statute that allows you to do that.  This is significant, in that if you recorded my call, even if it was illegal, it wouldn’t necessarily make sense for me to sue you over that, if you didn’t do something harmful, like put it on the Internet. Privacy legislation is out there where you don’t need to show any damages to receive compensation.  That makes people pay more attention to it, and motivates the Plaintiffs’ bar to sue.

Anecdotally, I’m seeing the members of the judiciary that aren’t the “eDiscovery rock stars” that we all know becoming a lot more eDiscovery savvy through education and dealing with the issues regularly.  Before, judges weren’t necessarily familiar with eDiscovery issues because those issues hadn’t been argued before them.  Now, I’m seeing more familiarity with it.  I’m also seeing more clients drawing a line on undue burdensomeness, and I am very willing to say to a Judge on behalf of a client  “no, we’re not going to spend $1 million on discovery just because opposing counsel asked for everything under the moon, it’s too burdensome and we’re going to quantify why it is overly burdensome, and ask that if they want the moon they have to pay for it”.  And, the judiciary has, in accordance with the rules, been receptive to those kinds of undue burden arguments.  And, I expect to see more litigation on that, with people “drawing lines in the sand” as to how much they will spend on discovery.

I’m also seeing more state rules changed to accommodate eDiscovery, especially rules that allow “clawback” orders.  Illinois just passed a rule allowing “clawback” orders, similar to the Federal “clawback” provision.  That’s kind of odd, because there is a conflict of law issue there, where the Federal “clawback” rule allows the Federal court to make an order effective against other Federal courts and state courts (the clawback rule in the Federal Rules of evidence was actually implemented by Congress).  The state court equivalent in Illinois allows the state court to make a “clawback” order effective against other courts.  But, a state court can’t do that against a Federal court, but the rule “allows” them to do so.  As a matter of law, I don’t think a state court can place a protective order that would be binding against a Federal court, it runs afoul of a couple hundred years of case law.

Also, Florida adopted new rules, effective last September.  I think it should be a big goal for those drafting state rules to provide clear guidance to trial courts to help them in addressing these issues, because they’re tough issues.  Trial courts deal with a high volume of cases with very limited resources and they can’t take a couple of days to “chew on” eDiscovery textbooks, so I think state courts appreciate clear guidance in state rules and I think you’re going to see a lot more states go the way of Florida and pass eDiscovery rules.  I just had a hearing in Florida that was governed by the new rules – it would have been a lot more problematic without those rules.

More from Adam tomorrow!

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Fulbright’s Litigation Trends Survey Shows Increased Litigation, Mobile Device Collection – eDiscovery Trends

According to Fulbright’s 9th Annual Litigation Trends Survey released last month, companies in the United States and United Kingdom continue to deal with, and spend more on litigation.  From an eDiscovery standpoint, the survey showed an increase in requirements to preserve and collect data from employee mobile devices, a high reliance on self-preservation to fulfill preservation obligations and a decent percentage of organizations using technology assisted review.

Here are some interesting statistics from the report:

PARTICIPANTS

Here is a breakdown of the participants in the survey.

  • There were 392 total participants from the US and UK, 96% of which were either General Counsel (82%) or Head of Litigation (14%).
  • About half (49%) of the companies surveyed, were billion dollar companies with $1 billion or more in gross revenue.  36% of the total companies have revenues of $10 billion or more.

LITIGATION TRENDS

The report showed increases in both the number of cases being encountered by organizations, as well as the total expenditures for litigation.

Increasing Litigation Cases

  • This year, 92% of respondents anticipate either the same amount or more litigation, up from 89% last year.  26% of respondents expect litigation to increase, while 66% expect litigation to stay the same.  Among the larger companies, 33% of respondents expect more disputes, and 94% expect either the same number or an increase.
  • The number of respondents reporting that they had received a lawsuit rose this year to 86% estimating at least one matter, compared with 73% last year. Those estimating at least 21 lawsuits or more rose to 33% from 22% last year.
  • Companies facing at least one $20 million lawsuit rose to 31% this year, from 23% the previous year.

Increasing Litigation Costs

  • The percentage of companies spending $1 million or more on litigation has increased for the third year in a row to 54%, up from 51% in 2011 and 46% in 2010, primarily due to a sharp rise in $1 million+ cases in the UK (rising from 38% in 2010 up to 53% in 2012).
  • In the US, 53% of organizations spend $1 million or more on litigation and 17% spend $10 million or more.
  • 33% of larger companies spent $10 million on litigation, way up from 19% the year before (and 22% in 2010).

EDISCOVERY TRENDS

The report showed an increase in requirements to preserve and collect data from employee mobile devices, a high reliance on self-preservation to fulfill preservation obligations and a decent percentage of organizations using technology assisted review.

Mobile Device Preservation and Collection

  • 41% of companies had to preserve and/or collect data from an employee mobile device because of litigation or an investigation in 2012, up from 32% in 2011.
  • Similar increases were reported by respondents from larger companies (38% in 2011, up to 54% in 2012) and midsized companies (26% in 2011, up to 40% in 2012).  Only respondents from smaller companies reported a drop (from 26% to 14%).

Self-Preservation

  • 69% of companies rely on individuals preserving their own data (i.e., self-preservation) in any of their disputes or investigations.  Larger and mid-sized companies are more likely to utilize self-preservation (73% and 72% respectively) than smaller companies (52%).
  • 41% of companies use self-preservation in all of their matters, and 73% use it for half or more of all matters.
  • When not relying on self-preservation, 72% of respondents say they depend on the IT function to collect all data sources of pertinent custodians.
  • Reasons that respondents gave for not relying on self-preservation included: More cost effective and efficient not to rely on custodian 29%; Lack of compliance by custodians 24%; High profile matter 23%; High monetary or other exposure 22%; Need to conduct forensics 20%; Some or all custodians may have an incentive to improperly delete potentially relevant information; 18%; Case law does not support self-preservation 14% and High profile custodian 11%.

Technology Assisted Review

  • 35% of all respondents are using technology assisted review for at least some of their matters.  U.S. companies are more likely to employ technology-assisted review than their U.K. counterparts (40% versus 23%).
  • 43% of larger companies surveyed use technology assisted review, compared with 32% of mid-sized companies and 23% of the smaller companies.
  • Of those companies utilizing technology assisted review, 21% use it in all of their matters and 51% use it for half or more of their matters.

There are plenty more interesting stats and trends in the report, which is free(!).  To download your own copy of the report, click here.

So, what do you think?  Do any of those trends surprise you?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

eDiscovery Daily Is Thirty! (Months Old, That Is)

Thirty months ago yesterday, eDiscovery Daily was launched.  It’s hard to believe that it has been 2 1/2 years since our first three posts that debuted on our first day.  635 posts later, a lot has happened in the industry that we’ve covered.  And, yes we’re still crazy after all these years for committing to a daily post each business day, but we still haven’t missed a business day yet.  Twice a year, we like to take a look back at some of the important stories and topics during that time.  So, here are just a few of the posts over the last six months you may have missed.  Enjoy!

In addition, Jane Gennarelli has been publishing an excellent series to introduce new eDiscovery professionals to the litigation process and litigation terminology.  Here is the latest post, which includes links to the previous twenty one posts.

Thanks for noticing us!  We’ve nearly quadrupled our readership since the first six month period and almost septupled (that’s grown 7 times in size!) our subscriber base since those first six months!  We appreciate the interest you’ve shown in the topics and will do our best to continue to provide interesting and useful eDiscovery news and analysis.  And, as always, please share any comments you might have or if you’d like to know more about a particular topic!

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Outlook Emails Can Take Many Forms – eDiscovery Best Practices

Most discovery requests include a request for emails of parties involved in the case.  Email data is often the best resource for establishing a timeline of communications in the case and Microsoft® Outlook is the most common email program used in business today.  Outlook emails can be stored in several different forms, so it’s important to be able to account for each file format when collecting emails that may be responsive to the discovery request.

There are several different file types that contain Outlook emails, including:

EDB (Exchange Database): The server files for Microsoft Exchange, which is the server environment which manages Outlook emails in an organization.  In the EDB file, a user account is created for each person authorized at the company to use email (usually, but not always, employees). The EDB file stores all of the information related to email messages, calendar appointments, tasks, and contacts for all authorized email users at the company.  EDB files are the server-side collection of Outlook emails for an organization that uses Exchange, so they are a primary source of responsive emails for those organizations.  Not all organizations that use Outlook use Exchange, but larger organizations almost always do.

OST (Outlook Offline Storage Table): Outlook can be configured to keep a local copy of a user’s items on their computer in an Outlook data file that is named an offline Outlook Data File (OST). This allows the user to work offline when a connection to the Exchange computer may not be possible or wanted. The OST file is synchronized with the Exchange computer when a connection is available.  If the synchronization is not current for a particular user, their OST file could contain emails that are not on the EDB server file, so OST files may also need to be searched for responsive emails.

PST (Outlook Personal Storage Table): A PST file is another Outlook data file that stores a user’s messages and other items on their computer. It’s the most common file format for home users or small organizations that don’t use Exchange, but instead use an ISP to connect to the Internet (typically through POP3 and IMAP).  In addition, Exchange users may move or archive messages to a PST file (either manually or via auto-archiving) to move them out of the primary mailbox, typically to keep their mailbox size manageable.  PST files often contain emails not found in either the EDB or OST files (especially when Exchange is not used), so it’s important to search them for responsive emails as well.

MSG (Outlook MSG File): MSG is a file extension for a mail message file format used by Microsoft Outlook and Exchange.  Each MSG file is a self-contained unit for the message “family” (email and its attachments) and individual MSG files can be saved simply by dragging messages out of Outlook to a folder on the computer (which could then be stored on portable media, such as CDs or flash drives).  As these individual emails may no longer be contained in the other Outlook file types, it’s important to determine where they are located and search them for responsiveness.  MSG is also the most common format for native production of individual responsive Outlook emails.

Other Outlook file types that might contain responsive information are EML (Electronic Mail), which is the Outlook Express email format and PAB (Personal Address Book), which, as the name implies, stores the user’s contact information.

Of course, Outlook emails are not just stored within EDB files on the server or these other file types on the local workstation or portable media; they can also be stored within an email archiving system or synchronized to phones and other portable devices.  Regardless, it’s important to account for the different file types when collecting potentially responsive Outlook emails for discovery.

So, what do you think?  Are you searching all of these file types for responsive Outlook emails?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

JP Morgan Chase Sanctioned for a Failure to Preserve Skill Codes – eDiscovery Case Law

Last week, we discussed how the Equal Employment Opportunity Commission (EEOC) was sanctioned for failing to comply with a motion to compel production of social media data that they had been previously ordered to produce.  Now, the “shoe is on the other foot” as their opponent in another case has been sanctioned for spoliation of data.

In EEOC v. JP Morgan Chase Bank, 2:09-cv-864 (S.D. Ohio Feb. 28, 2013), District Judge Gregory L. Frost granted the EEOC’s motion for sanctions for spoliation of data, entitling the plaintiff to “a permissive adverse jury instruction related to the spoliation if this litigation proceeds to a jury trial”, and denied the defendant’s motion for summary judgment.

In this gender discrimination case, the plaintiff requested skill codes from the defendant that determined how calls were routed, contending that statistical analysis of the skill code data would reveal discrimination by illustrating that skill codes resulted in the more lucrative calls being directed to male employees.  When defendant did not provide the plaintiff with select skill code data records and other information, the plaintiff filed a motion to compel, which was granted (for most of the requested date range).  When the defendant again failed to produce the data, the plaintiff filed a second motion to compel, then withdrew it after the parties appeared to agree to resolve issues (documented in the Magistrate Judge’s order), then filed the motion for sanctions after the defendant failed to comply, indicating that the defendant had purged data from July 8, 2006 through March 10, 2007.

Noting that it is “curious to this Court that defendant began to preserve some other electronic information shortly thereafter” class notices from the plaintiff in 2008 and 2009, “but not all skill login data until late 2010”, Judge Frost stated that “Defendant’s failure to establish a litigation hold is inexcusable. The multiple notices that should have triggered a hold and Defendant’s dubious failure if not outright refusal to recognize or accept the scope of this litigation and that the relevant data reaches beyond the statutory period present exceptional circumstances that remove the conduct here from the protections provided by Rule 37(e).”

As a result, indicating that “Defendant’s conduct constitutes at least negligence and reaches for willful blindness bordering on intentionality”, Judge Frost granted the EEOC’s motion for sanctions for spoliation of data, entitling the plaintiff to “a permissive adverse jury instruction related to the spoliation if this litigation proceeds to a jury trial”, and denied the defendant’s motion for summary judgment.

So, what do you think?  Did the defendant’s conduct warrant the sanctions?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

Award to Apple in Samsung Case Cut Almost in Half, For Now – eDiscovery Case Law

In Apple Inc. v. Samsung Elecs. Co., Case No.: C 11-CV-01846-LHK (N.D. Cal. Mar. 1, 2013), District Judge Lucy Koh reduced the amount of the previous jury award against Samsung in its ongoing intellectual property case from nearly $1.05 billion to over $598 million, due to ordering a new trial on damages for several Samsung products that amounted to over $450 million being stricken from the jury’s award.

In August of last year, a jury of nine found that Samsung infringed all but one of the seven patents at issue and found all seven of Apple’s patents valid – despite Samsung’s attempts to have them thrown out. They also determined that Apple didn’t violate any of the five patents Samsung asserted in the case.  Apple had been requesting $2.5 billion in damages.  Apple later requested additional damages of $707 million to be added to the $1.05 billion jury verdict.  This case was notable from an eDiscovery perspective due to the adverse inference instruction issued by California Magistrate Judge Paul S. Grewal against Samsung just prior to the start of trial for spoliation of data, though it appears that the adverse inference instruction did not have a significant impact in the verdict.

Notice of the Patents

A significant portion of this ruling was related to notice of the patents.  As Judge Koh noted in her ruling, “Under 35 U.S.C. § 287(a), there can be no damages award where a defendant did not have actual or constructive notice of the patent or registered trade dress at issue. Thus, it is improper to award damages for sales made before the defendant had notice of the patent, and an award that includes damages for sales made before notice of any of the intellectual property (“IP”) infringed is excessive as a matter of law.”  The parties disputed whether Apple had given Samsung notice of each of the patents prior to the filing of the complaint and the amended complaint.

Apple had provided to the Court numbers necessary to calculate Samsung’s profits and reasonable royalty awards based on damages numbers provided by Apple’s damages expert, but with later notice dates, enabling the Court, for some products, to calculate how much of the jury’s award compensated for the sales before Samsung had notice of the relevant IP.  However, as Judge Koh noted, “for other products, the jury awarded an impermissible form of damages for some period of time, because Samsung had notice only of utility patents for some period, but an award of infringer’s profits was made covering the entire period from August 4, 2010 to June 15, 2012. For these products, the Court cannot remedy the problem by simply subtracting the extra sales.” {emphasis added}  The Court had instructed the jury that infringer’s profits are not a legally permissible remedy for utility patent infringement.

Ruling

Therefore, Judge Koh ordered a new trial on damages for 14 products, totaling $450,514,650 being stricken from the jury’s award.  This left an award of $598,908,892 on the remaining awarded products.

So, what do you think?  What will be the final award and how much will it cost to determine that?  Please share any comments you might have or if you’d like to know more about a particular topic.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.