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Are There Limits to e-Discovery? Key Takeaways from Recent Decisions on e-Discovery

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Recently, cases exploring the limits of electronic discovery are percolating to the highest courts in both the state and federal systems. As of late, courts have focused on proportionality. This presentation by BoyarMiller attorney Kasi Chadwick explores those decisions and their implications in light of the rules of civil procedure.

Published in: Law
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Are There Limits to e-Discovery? Key Takeaways from Recent Decisions on e-Discovery

  1. 1. Are There Limits to e- Discovery? Key Takeaways from Recent Decisions on e- Discovery Kasi Chadwick InfraGard September 27, 2017
  2. 2. Discovery in Theory
  3. 3. PAGE The Problem – Discovery is to Seek the Truth? "YOU CAN’T HANDLE THE TRUTH" • "[A] just, fair, equitable, and impartial adjudications of the rights of litigants" • "[W]ith as great expedition and dispatch at the least expense both to the litigants and to the state as may be practicable" • However, many belief that the rising cost of discovery is forcing strategic decisions in cases, regardless of the case’s merit 3 "[T]he ultimate purpose of discovery is to seek the truth…" Jampole v. Touchy, 673 S.W.2d 569 (Tex. 1984).
  4. 4. PAGE Enter e-Discovery EFFECTS OF E-DISCOVERY • e-discovery consists of more than just the electronic production of e-mails – Electronic messages – Voicemail – Computer forensics • e-discovery can significantly fast-track the review of information in litigation • If the purpose of discovery is to truly seek the truth, e- discovery (when done correctly) allows litigants to essentially recreate the underlying facts • Deponents lie at deposition; data does not 4
  5. 5. PAGE Enter e-Discovery EFFECTS OF E-DISCOVERY • Alternatively, e-discovery—even when done correctly—has expanded the amount of documents and data at play in a lawsuit • $$$ • Accordingly, Texas and Federal Courts are attempting to set the appropriate limits of e-discovery 5
  6. 6. Changes to Rules
  7. 7. PAGE Winds of Change FEDERAL • In 2015, the United States Supreme Court approved several, material changes to Rules 26 and 34 to the Federal Rules of Civil Procedure STATE • Texas Courts, largely relying on the federal changes, are issuing rulings to limit e-discovery • The Texas Supreme Court Advisory Committee is presently considering potential changes to the Texas rules to track the 2015 changes to the Federal Rules 7
  8. 8. Winds of Change – Federal Level
  9. 9. PAGE Winds of Change – Federal Level 2015 AMENDMENTS • Changes to Rule 26 and Rule 34 • These changes were largely made to reduce the costs of e- discovery – The Advisory Committee noted that the costs of discovery "are disproportionately high." • Proportionality is now key – Now, the new rules essentially require lawyers to be more cognizant of what is—and what is not—important in a case – "Do unto others?" 9
  10. 10. PAGE Winds of Change – Federal Level CHANGES TO RULE 26(B)(1) – "SCOPE IN GENERAL" 10 Old Rule Amended Rule 26(b)(1) …Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense [-including the existence, description, nature, custody, condition, and location of any documents or other tangible things and the identity and location of persons who know of any discoverable matters…] …Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to the relevant information, the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.
  11. 11. PAGE Winds of Change – Federal Level CHANGE TO RULE 26(B)(1) MEANING? • Rule 26(b)(1) controls the general scope of discovery • Changes the period when the reasonableness of discovery requests are to be evaluated • While 6 of these 7 factors previously appeared in another part of the Federal Rules (governing court-ordered limitations on discovery), these 6 factors were previously only employed when a party sought a protective order from the court to limit discovery on the back-end • Under the new rules, these factors are to be considered in determining the overall scope of discovery on the front-end 11
  12. 12. PAGE Winds of Change – Federal Level CHANGE TO RULE 26(B)(1) MEANING? • Proportionality! • This is the new, 7th factor for consideration • And, in practice, it is HUGE • The shift to a proportionality analysis has been a chief focus of Texas courts as well 12
  13. 13. PAGE Winds of Change – Federal Level CHANGES TO RULE 26(B)(1) – "SCOPE IN GENERAL" 13 Old Rule Amended Rule 26(b)(1) […For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence…] …Information within this scope of discovery need not be admissible in evidence to be discoverable
  14. 14. PAGE Winds of Change – Federal Level CHANGE TO RULE 26(B)(1) MEANING? • As always, information need not be admissible to be discoverable • Clarifies that the scope of discovery is not tied to the probability of discovering admissible evidence • Even so, requests are still limited to "non-privileged matter[s] that [are] relevant to any party’s claim or defense" – The changes to this portion of Rule 26(b)(1) do not likely change the availability of a valid relevance objection to an overly broad discovery request • Relevance—calling it "the importance of the discovery"—is still a critical factor in seeking (or opposing) e-discovery 14
  15. 15. PAGE Winds of Change – Federal Level CHANGES TO RULE 26(D)(2) – "TIMING AND SEQUENCE OF DISCOVERY" 15 Old Rule Amended Rule 26(d)(2) [Current Rule 26(d)(2), concerning the sequence of discovery, is moved to 26(d)(3), with a minor edit.] (A) More than 21 days after the summons and complaint are served on a party, a request under Rule 34 may be delivered: (i) to that party by any other party, and (ii) by that party to any plaintiff or to any other party that has been served (B) The request is considered to have been served at the first Rule 26(f) conference
  16. 16. PAGE Winds of Change – Federal Level CHANGE TO RULE 26(D)(2) MEANING? • The change to Rule 26(d)(2) allows a party to serve discovery requests prior to the Rule 26(f) conference • Requests for production may be served as soon as 22 days after service of the complaint and summons • If such discovery is served, a party’s time to respond does not begin to run until after the parties’ Rule 26(f) conference 16
  17. 17. PAGE Winds of Change – Federal Level CHANGE TO RULE 26(D)(2) MEANING? • This change was intended to make the parties’ Rule 26(f) conference more productive – If there’s a basic understanding of the initial discovery to be propounded, the Rule 26(f) conference may be used to hammer-out details like document searches and medium of production • However, in practice, this is not occurring 17
  18. 18. PAGE Winds of Change – Federal Level CHANGES TO RULE 34 – "RESPONSES AND OBJECTIONS" TO ESI REQUESTS 18 Old Rule Amended Rule 34(b)(2)(B) For each item or category, the response must either state that inspection and related activities will be permitted as requested or state [an objection] to the request, including the reasons. For each item or category, the response must either state that inspection and related activities will be permitted as requested or state with specificity the grounds for objecting to the request, including the reasons. The responding party may state that it will produce copies of documents or of electronically stored information instead of permitting inspection. The production must then be completed no later than the time for inspection specified in the request or another reasonable time specified in the response. 32(b)(2)(C) An objection to party of a request must specify the part and permit inspection of the rest. An objection must state whether an responsive materials are being withheld on the basis of that objection. An objection to party of a request must specify the part and permit inspection of the rest.
  19. 19. PAGE Winds of Change – Federal Level CHANGE TO RULE 34(B)(2)(B) MEANING? • Rule 34(b)(2)(B) controls, among other things, the time to respond and object to the production of electronically stored information and tangible things • Parties now must: – Provide greater specifics in objections; – Produce responsive documents within a "reasonable time"; and – Given an express confirmation in its response whether documents are being withheld based on any stated objection • This has implications for e-discovery – Arguably, must produce documents quicker 19
  20. 20. PAGE Winds of Change – Federal Level CHANGE TO RULE 26(D)(2) MEANING? • Greater specificity in objections required – Can no longer say the request is "vague and ambiguous" or "unduly burdensome" as a whole – Instead, lawyers are to point to exactly what is "vague and ambiguous" and/or "unduly burdensome" in their objections 20
  21. 21. PAGE Winds of Change – Federal Level CHANGE TO RULE 26(D)(2) MEANING? • Production within a "reasonable time" – For better or for worse, lawyers sometimes respond to discovery requests without producing documents and do not specify when responsive document will be produced – This change puts a stop to this practice 21
  22. 22. PAGE Winds of Change – Federal Level CHANGE TO RULE 26(D)(2) MEANING? • Documents withheld – When lawyers object and then produce documents, it is not always clear whether documents are being withheld pursuant to the lawyer’s objections – This change requires the responding lawyer to affirmatively say if documents are withheld – Does not require the responding lawyer to identify the withheld documents (That’s Rule 26(b)(5)) 22
  23. 23. Winds of Change – Texas State Level
  24. 24. PAGE Winds of Change – Texas State Level THE TEXAS SUPREME COURT’S ADVISORY COMMITTEE’S ACTION – In April 2016, the Texas Supreme Court asked Supreme Court Advisory Committee to consider potential changes to rules • "Modernize the rules" • "Increase efficiency" • "Decrease the cost of litigation" – Inspired by: • 2015 changes to Federal Rules of Civil Procedure • State Bar Court Rules Committee proposals • Last change was in late 1990s – Discovery Subcommittee currently revising proposals based on Advisory Committee feedback after numerous meetings 24
  25. 25. PAGE PROPORTIONALITY! • Mirrors new Federal Rule 26(b)(1) • Much debate over sufficiency of current rules – Rule 192.3: Scope • "any matter that is not privileged and is relevant" • "reasonably calculated to lead to the discovery of admissible evidence" • Documents, persons, witnesses, experts, etc. – Rule 192.4: Limits • "unreasonably cumulative or duplicative" • "obtainable from some other source that is more convenient, less burdensome, less expensive" • "burden or expense outweighs the benefit" Winds of Change – Texas State Level 25
  26. 26. Recent Texas Decisions
  27. 27. PAGE Recent Supreme Court of Texas Trend IN RE STATE FARM LLOYDS 520 S.W.3d 595 (Tex. 2017) (orig. proceeding) • Facts – Residential homeowners sued their insurer alleging underpaying of insured hail-damage claims – A discovery protocol was entered by the trial court requiring State Farm to produce their ESI in native form regardless of whether a more convenient, less expensive, and "reasonably usable’ format was readily available – In the normal course of State Farm’s business native documents were transferred to static form – State Farm offered to produce ESI in a searchable, but static form in .pdf, .tiff, and .jpeg files – The insured demanded native production – The trial court demanded native production; State Farm mandamused 27
  28. 28. PAGE Recent Supreme Court of Texas Trend IN RE STATE FARM LLOYDS 520 S.W.3d 595 (Tex. 2017) (orig. proceeding) • General rule – Scope of discovery is "any matter that is not privileged and is relevant to the subject matter of the pending action" • Counterbalance – "[U]nwarranted delay and expense" • "The simple fact that requested information is discoverable…does not mean that discovery must be had" • As to metadata, while it may be generally discoverable if relevant and unprivileged, that does not mean that production in a metadata-friendly format is necessarily required 28
  29. 29. PAGE Recent Supreme Court of Texas Trend IN RE STATE FARM LLOYDS 520 S.W.3d 595 (Tex. 2017) (orig. proceeding) • Whether production of metadata is required "engages the interplay between the discovery limits of Rule 192.4 and production of electronic discovery under Rule 196.4" 29
  30. 30. PAGE 30
  31. 31. PAGE Recent Supreme Court of Texas Trend IN RE STATE FARM LLOYDS 520 S.W.3d 595 (Tex. 2017) (orig. proceeding) • The Texas Supreme Court focused on proportionality • The proportionality inquiry requires case-by-case balancing in light of the following factors: – Likely benefit of the requested discovery – The needs of the case – The amount in controversy – The parties’ resources – Importance of the issues at stake in the litigation – Importance of the propose discovery in resolving the litigation – Any other articulable factor bearing on proportionality 31
  32. 32. PAGE Recent Supreme Court of Texas Trend IN RE STATE FARM LLOYDS 520 S.W.3d 595 (Tex. 2017) (orig. proceeding) • The Texas Supreme Court expressly noted that this application of proportionality aligns electronic-discovery practice under the Texas Rules of Civil Procedure with electronic-discovery practice under the Federal Rules of Civil Procedure • The Texas rules "as written are not inconsistent with the federal rules or the case law interpreting them" 32
  33. 33. Federal Jurisprudence as Guide
  34. 34. PAGE Federal Jurisprudence on e-Discovery Since 2015 SCOTT V. EGLIN FED. CREDIT UNION – NORTHERN DISTRICT OF FLORIDA (2017) • "[R]equiring [the defendant] to search, collect and produce emails and text messages is not proportional to the needs of this case and therefore not within the scope of discovery as now defined in Rule 26" • "Balancing the marginal relevance of information in emails and text messages against the time and expense that would be involved for a small business like [the defendant] in searching cellular telephones, servers and other electronic storage facilities makes little sense and would cause Plaintiff's current employer to incur an expense that ultimately will have little or no impact on the outcome of the case" CRABTREE V. ANGIE’S LIST, INC. – SOUTHERN DISTRICT OF INDIANA (2017) • Denying defendant's request for a forensic examination of the plaintiffs' electronic devices because whatever evidence might be found was already available to the defendant from other sources and privacy and confidentiality interests were significant 34
  35. 35. PAGE Federal Jurisprudence on e-Discovery Since 2015 FIRST AM. BANKCARD V. SMART BUS. TECH., INC. – EASTERN DISTRICT OF LOUISIANA CASE (2017) • Failing to compel the requested forensic imagining so as to not "exceed[] the proportionality limit" • Sought a broad-ranging forensic image of defendants’ "computer/server" without any further detail in the request • Court found this request was neither relevant nor proportional HESPE V. CITY OF CHICAGO – NORTHERN DISTRICT OF ILLINOIS (2016) • Chicago police officer sued CPD for sex discrimination and hostile work environment • Plaintiff failed to produce responsive text messages and voice mails initially; defendant only learned of these items in the deposition of plaintiff’s mother • Defense counsel requested a forensic review of plaintiff’s computer • The court denied; upheld on appeal • While plaintiff had failed to produce responsive information previously, no link to the plaintiff’s computer and the case established 35
  36. 36. PAGE Parting Thought 36 ARE THESE DECISIONS THE BEST POLICY? • If discovery in litigation is truly intended to seek the truth, is proportionality a valid consideration?
  37. 37. Questions? 37OBTAINING AND OBJECTING TO WRITTEN DISCOVERY IN TEXAS STATE COURT
  38. 38. Kasi Chadwick: kchadwick@boyarmiller.com BOYARMILLER : 713.850.7766

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