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Trial Court Did Not Err In Denying Plaintiff’s Request For Second Search Of Mirror Images As Unreasonable “Fishing Expedition”

Posted in CASE SUMMARIES

Liturgical Publ’ns, Inc. v. Karides, 2006 WL 931892 (Wis. Ct. App. Apr. 12, 2006) (Unpublished)

In this case, plaintiff asserted claims for employee disloyalty, misappropriation of trade secrets and computer theft against two former employees and their competing company. The trial court dismissed several claims on summary judgment, including the computer theft claim. After a jury trial on the remaining claims resulted in a defense verdict, plaintiff appealed. In conjunction with arguing that the trial court erred in dismissing its claim for computer theft, plaintiff argued that the trial court erroneously exercised its discretion by denying its motion to compel additional discovery on the issue.

The appellate court noted that the trial court conducted four hearings at which plaintiff’s request for computer discovery was considered. Six days after the filing of the summons and complaint, the trial court denied plaintiff’s motion for discovery and forensic inspection of the business and personal computers of defendants on the ground that no basis had been shown for concluding that information relevant to the case was on those computers. However, it subsequently entered an order prohibiting any party from destroying or deleting any data or programs on their personal or business computers.

Thereafter, a lengthy hearing was held on plaintiff’s motion to compel discovery of the computers. At the conclusion of the hearing, the trial court ordered the making of mirror images of the personal and business computers of defendants. It also ordered that a referee would be appointed to supervise the making of the mirror images and inspection. In response to testimony from plaintiff’s expert as to how an inspection could be performed, the trial court ordered that the inspection of the mirror images would be limited to a “hash value search,” described as “comparing hash values of materials on the defendants’ computers to hash values on the Liturgical computers.”

The mirror images were made, and Liturgical submitted a list of approximately 400 hash values, representing a variety of Liturgical documents, letters, contracts and other records. Following an inspection by plaintiff’s computer expert, no hash value matches were found.

When the hash value search did not result in any matches, Liturgical moved the trial court to compel the defendants to submit to a second inspection of the mirror images with defined search parameters, including a search for specified words, evidence of reformatting, evidence of wiping or deleting files, folders or utilities, and evidence of other computer activity during a particular time frame. The trial court denied the motion after an additional hearing on the matter.

On appeal, Liturgical argued that it was clear from the testimony of its expert that a hash value search might not result in matches, but this would not mean that data had not been transferred from Liturgical computers to defendants’ computers. Liturgical contended that when no matches showed up in the hash value search, it was entitled to pursue an additional search, which would reveal material that had been accessed or copied but had been altered in some way so that its hash value no longer matched the hash value of Liturgical.

The appellate court concluded that the trial court acted within the scope of its discretion in denying plaintiff’s additional request, “which essentially amounted to a fishing expedition.” The court stated it was clear from the trial court’s discussion that it understood plaintiff’s arguments, but had concluded that further discovery would be unreasonable, since a search involving great detail and specificity had already been allowed and yielded nothing. Although the trial court had stated that it might have allowed some additional discovery if the previous search had yielded information of some relevance to the action, it concluded that in the absence of any meaningful yield from the discovery that had occurred, further discovery would be unreasonable.

The appellate court found no basis to disturb the trial court’s decision. It observed:

As argued by the defendants, the discovery was expensive, resulting in attorneys’ fees, computer expert fees, and referee fees. It was also burdensome in terms of time. Balancing these burdens against speculation that relevant evidence would be found after intensive discovery had already yielded no results, the trial court reasonably denied the motion.

The appellate court further ruled that the trial court acted correctly in refusing to permit plaintiff to inform the jury that the trial court had denied its request to conduct an additional computer search, since the court’s ruling on a discovery motion was not “evidence.”