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Defendant Not Required to Modify Production After Plaintiff Fails to Demonstrate Prejudice: eDiscovery Case Law

Court Denies Defendant’s Motion to Overrule Plaintiff’s Objections to Discovery Requests

In Excel Enterprises, LLC v. Winona PVD Coatings, LLC, No. 3:16-cv-19-WCL-MGG (N.D. Ind., Feb. 17, 2017), Indiana Magistrate Judge Michael G. Gotsch, Sr. ruled that despite the fact that the defendant failed to demonstrate that it produced documents kept in the ordinary course of business, the plaintiff failed to demonstrate any prejudice suffered from the current state of the production and granted the defendant’s motion to reconsider the court’s earlier order regarding the format of the defendant’s production.

Case Background

In this breach of contract case, the plaintiff’s counsel informed the defendant’s counsel that the documents in its original production were not searchable and identified the format for the documents it preferred. In response, the defendant converted all of its responsive documents to the plaintiff’s preferred format and delivered them to the plaintiff in the requested format on 8 days later in July 2016.

On that same day, the plaintiff filed a motion to compel alleging, among other things, that the defendant had not complied with the production requirements set forth in Fed. R. Civ. P. 34(b)(2)(E)(i), which requires parties to produce documents responsive to requests for production “as they are kept in the usual course of business” or to “organize and label them to correspond to the categories in the request.”  The plaintiff argued that the defendant’s documents were not presented as they were kept in the usual course of business and asked the Court to compel the defendant to organize and label the documents to clarify which document responded to which specific discovery request.

The Court ultimately granted this part of the plaintiff’s motion, ordering the defendant “to supplement its production to identify by Bates Numbers which documents were produced in response to which specific discovery requests by November 15, 2016” because the defendant’s assertion that it produced the requested documents as they were kept in the ordinary course of business was not sufficiently supported with appropriate evidence.  In response, the defendant filed an instant motion to reconsider, presenting additional evidence (including attaching an affidavit from its Director of Information Technology) in an attempt to show that its production complies with Rule 34(b)(2)(E)(i).  However, the plaintiff objected, arguing that the affidavit failed to explain how the documents were stripped of their metadata and converted to unsearchable .pdf and .tiff files before the initial production or maintained as unsearchable .pdf and .tiff files in its ordinary course of business.

Judge’s Ruling

Judge Gotsch noted that the defendant “had the opportunity to present evidence that it produced the 30,000 documents as they were kept in the usual course of its business”, but its “attempt to so demonstrate was determined to be deficient to such an extent that the Court ordered Winona to comply with the other option under Rule 34(b)(2)(E)(i)—organizing and labeling the 30,000 documents to correspond to the categories in Excel’s discovery requests.”  Even with the affidavit submitted with the instant motion to reconsider, Judge Gotsch noted that the affidavit “clearly describes the process Winona used to produce its responsive documents to Excel, but provides no explanation of how the responsive documents were kept in the ordinary course of Winona’s business.”

However, the defendant also argued that “Excel has yet to offer any argument or evidence that it has suffered prejudice as a result of Winona’s production.”  To that, Judge Gotsch responded, stating that “Winona is correct. Through both its second motion to compel and its objection to the instant motion to reconsider, Excel has merely asked the Court to hold Winona to the form of Rule 34(b)(2)(E)(i) with no discussion of any adverse effect on Excel should the Court deem Winona’s current production of 30,000 documents, in the format explicitly requested by Excel and with important identifying information, complete.”  Noting that Fed. R. Civ. P. 26(b)(1), gives district courts broad powers to manage discovery in their cases, Judge Gotsch stated that “Excel’s demand for strict compliance with Rule 34(b)(2)(E)(i) amounts to a form-over-substance argument. As such, the cost and time Winona would expend to organize and label the 30,000 responsive documents at this time would pose a burden that outweighs the potential benefit of the exercise to Excel.”  As a result, he granted the defendant’s motion to reconsider the court’s earlier order.

So, what do you think?  Was that the right decision or should the court have stuck with its original order?  Please share any comments you might have or if you’d like to know more about a particular topic.

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