Plaintiff's Efforts to Preserve and Produce Email and Electronic Records Were Untimely and Inadequate; Court Invites Motion for Sanctions

Posted on November 27, 2006 by K&L Gates
Reino de Espana v. Am. Bureau of Shipping, 2006 WL 3208579 (S.D.N.Y. Nov. 3, 2006)

This litigation arose from the casualty of the Prestige off the coast of Spain in November 2002, which caused a large oil spill. In this opinion, the court granted defendant ABS’s motion to compel the production of email and other electronic records prepared by various governmental agencies that were involved in the response to and investigation of the spill. In addition, the court invited ABS to seek sanctions for Spain’s apparent failure to preserve relevant evidence.
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Court Orders Production of Handwritten Worksheets Underlying Database, in Light of Demonstrated Data Entry Errors

Posted on November 27, 2006 by K&L Gates
MacNamara v. City of New York, 2006 WL 3298911 (S.D.N.Y. Nov 13, 2006)

This case is one of many arising from the arrests of approximately 1,800 people during the Republican National Convention (“RNC”) in New York City in the summer of 2004. This decision addressed plaintiffs' motion to compel the city to produce certain documents and electronically stored information. Among other rulings, the court granted plaintiffs' request for production of certain arrest worksheets used in connection with the city's Online Booking System ("OLBS"). The OLBS worksheets contained handwritten information regarding the arresting or assigned officer's recollection of the events that preceded the arrest. The information on the worksheet is subsequently entered into the OLBS, often by someone other than the officer who filled out the worksheet. The city argued that the plaintiffs' request for OLBS worksheets for non-party arrestees was duplicative, since the information sought could be found in database printouts the city had already agreed to produce. However, plaintiffs contended that “significant errors, edits and omissions” occur at the data entry stage, and that the information contained in the handwritten worksheets sought may therefore differ from that in the database printouts, which contained only the information actually entered into the OLBS. The court found that an example cited by plaintiffs supported their contention, and ordered production of the worksheets subject to an "attorneys'-eyes-only" designation.

Ruling on a separate request, the court sustained the city's objection to plaintiffs' request for "[a]ll electronic data concerning RNC arrests" maintained by various entities, finding it to be impermissibly vague.
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Moure Quoted in Wall Street Journal

Posted on November 27, 2006 by K&L Gates

Preston Gates partner Helen Bergman Moure was quoted in today's Wall Street Journal in an article titled: New Rules Are Set for Federal Courts On Electronic Data.

"The changes "may serve as a wake-up call for some companies that haven't been in a case where electronic [evidence] has been produced," says Helen Bergman Moure, an attorney in the document analysis technology group at Seattle law firm Preston Gates & Ellis LLP. The rules govern only federal cases and leave penalty decisions to judges."

The article appears on page B3 of the print edition or in electronic format here [subscription required.]

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New E-Discovery Rules & The Attorney-Client Privilege: A Middle Ground for Waiver?

Posted on November 17, 2006 by K&L Gates

A November 2006 article by Preston Gates partner Julie Anne Halter for the Washington Legal Foundation:

"The proposed amendments to the Federal Rules of Civil Procedure will go into  effect on December 1, 2006, absent some affirmative act by Congress to prevent their  adoption. Among the amendments are provisions designed to address the everapparent  problem faced by corporate litigants: the volume of electronically stored  information and the varying ways it is maintained make it very difficult and often  cost-prohibitive to efficiently and effectively review it for privileged material prior to production. Under the current legal framework, the inadvertent production of  privileged or work-product protected material creates substantial risk; at the same  time, the effort and cost to conduct a comprehensive pre-production privilege review  often make such review impractical."

Click here to continue reading.

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Citing The Sedona Conference Glossary for E-Discovery, Court Overrules Vagueness and Ambiguity Objections to Request for Production

Posted on November 17, 2006 by K&L Gates
Johnson v. Kraft Foods N. Am., Inc., 2006 WL 3302684 (D. Kan. Nov. 14, 2006)

In this decision, the court granted in part plaintiffs’ motion to compel and overruled a number of defendants’ objections to plaintiffs’ request for production. Among other things, defendants had objected that many of the terms used in the request were vague and ambiguous, including: “electronic databases,” “personnel related data,” “database,” “coded fields,” and “data dictionaries.” Overruling the objection, the court noted that plaintiffs had attempted to resolve any ambiguity by providing definitions in a separate letter. It also noted that, while the court’s electronic discovery guidelines did not specifically provide definitions for the terms in dispute by the parties, the guidelines did provide a valuable reference to the Sedona Conference® for definitions of terms used in the guidelines. It concluded:
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Court Grants Access to Individual Plaintiff's Work and Home Computers; Plaintiff Had Continued Deleting Potentially Relevant Emails for Years After Commencing Litigation

Posted on November 16, 2006 by K&L Gates
Ball v. Versar, Inc., 2005 WL 4881102 (S.D. Ind. Sept. 23, 2005)

This case involved the remediation of a “Superfund” hazardous waste site in Indiana. Plaintiffs Roy Ball and Norman Bernstein (the “trustees”) were trustees for the fund formed by the hazardous waste generators to clean up the site under agreement with the relevant governmental agencies. The trustees sued Versar, Inc. for breach of its contract to perform remediation services at the site. In this motion, the defendant sought production of email and other documents it contended the trustees were improperly withholding, access to plaintiff Roy Ball’s personal and employer-owned computers, and sanctions for plaintiffs’ failure to produce or retain discoverable electronic evidence. Continue Reading...
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Bad Faith Spoliation of Critical Emails Warrants Adverse Inference Instruction

Posted on November 14, 2006 by K&L Gates
Optowave Co., Ltd. v. Nikitin, 2006 WL 3231422 (M.D. Fla. Nov. 7, 2006)

In this breach of contract case, Optowave contended that its contract with defendant Dmitri Nikitin d/b/a Precision Technology Group (“PTG”) incorporated eight certain specifications, and that PTG failed to meet any of the specifications, thereby breaching the contract. During discovery, Optowave sought to compel production of electronic documents and emails regarding the contract. Following oral argument and the parties’ agreement on certain issues raised by the motion to compel, the court scheduled a second hearing on the issue of spoliation of certain internal emails between Nikitin and his employees. Continue Reading...
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Supreme Court Refuses to Hear Qwest Case Involving Document Production

Posted on November 13, 2006 by K&L Gates

[From the Associated Press, November 13, 2006 and posted on Law.com]

The Supreme Court on Monday refused to consider a case in which Qwest Communications International Inc. had been ordered to produce 220,000 pages of documents to shareholders in a civil securities fraud lawsuit.

Qwest attorneys had argued the documents were protected by attorney-client and work-product privilege.

Many shareholders involved in the lawsuit reached a $450 million class action settlement with Qwest, but claims are pending against former Chief Executive Officer Joseph Nacchio and former Chief Financial Officer Robert Woodruff.

The 10th U.S. Circuit Court of Appeals upheld a lower court's decision that the company waived its privilege when it gave the documents to the Securities and Exchange Commission and Justice Department.

The shareholders sued the company in 2001, about a year before the Securities and Exchange Commission and the Justice Department opened separate investigations into accounting improprieties that eventually led Qwest to remove billions of dollars in improperly reported revenue from its books.

Based in Denver, Qwest is the primary phone service provider in 14 mostly Western states.

The case is Qwest Communications International Inc. v. New England Health Care Employees Pension Fund, 06-343.

 

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A Complete Set Of The Pending E-Discovery Amendments

Posted on November 7, 2006 by K&L Gates
A complete set of the pending e-discovery amendments to the Federal Rules of Civil Procedure, with Advisory Committee notes, is available here. Barring any action by Congress, these go into effect on December 1, 2006.
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Law Firm Must Surrender Client E-Mails Shared With 'Lay Adviser,' Judge Says

Posted on November 7, 2006 by K&L Gates

From the November issue of the New Jersey Law Journal: "A Morristown, N.J., law firm will have to turn over client e-mails in a federal court battle between a former client and his ex-employer, as a judge has rejected the firm's assertions of privilege.

The messages were exchanged among Riker Danzig Scherer Hyland & Perretti, its former client, Warren Tobin of New Zealand, and Matthew Young, a "lay adviser" to Tobin in a related New Zealand proceeding.

Tobin and Young are defendants in Stayinfront Inc. v. Tobin, 05-Civ.-4563, in which U.S. District Judge Stanley Chesler held on Nov. 3 that there was no attorney-client privilege protection for the e-mails because the privilege had been waived by sharing the messages with Young.

Work-product privilege was also unavailable. Chesler found the defendants' "recalcitrance, willful noncompliance and disregard for the rules and authority of this Court" constituted exceptional circumstances that justified piercing the privilege to compel production."

Click here to read the rest [ALM subscription required.]

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Relying on Delaware's Default Standards, Court Holds Production in Native Format with Metadata Not Required

Posted on November 6, 2006 by K&L Gates
Wyeth v. Impax Labs., Inc., 2006 WL 3091331 (D. Del. Oct. 26, 2006)

In this patent litigation, the court denied in part and granted in part defendant’s motion to compel. Impax contended, among other things, that Wyeth should be ordered to produce electronic documents in their native format, complete with metadata, and not in the Tagged Image File Format (“TIFF”) in which they were produced. Wyeth argued that Impax was not entitled to electronic copies in their natural state for two reasons: (1) Impax had not made a particularized showing of need for the metadata, and (2) collection of this data would be overly burdensome. Continue Reading...
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Citing Conference of Chief Justices' Guidelines to State Courts, North Carolina Court Refuses to Compel Nonparty to Produce Deleted Emails from Backup Tapes

Posted on November 6, 2006 by K&L Gates

Bank of America Corp. v. SR Int’l Bus. Ins. Co., Ltd., 2006 WL 3093174, 2006 NCBC 15 (N.C. Super. Nov. 1, 2006)

In its introductory remarks, the court advised:

This opinion should be read in conjunction with the opinion in Analog Devices, Inc. v. Michalski, 2006 NCBC 14, (N.C.Super.Ct. Nov. 1, 2006), issued contemporaneously herewith. The decision in that case deals with production of inaccessible data in the context of a party-to-party dispute and provides greater detail concerning approaches used by various courts in e-discovery disputes. Both this opinion and the opinion in Analog should make it clear that: (1) the language of current North Carolina Rules of Civil Procedure 26 and 45 still control trial court decisions and work well, (2) each case is different and fact intensive, (3) there exist numerous factors which might come into play in the varying factual contexts of each case, and (4) trial courts should always be cognizant that e-discovery decisions, especially those involving inaccessible data, have the potential to be outcome determinative because of the costs involved.

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North Carolina Court Orders Production of Email from Backup Tapes; Parties to Share Restoration Costs Equally

Posted on November 5, 2006 by K&L Gates

Analog Devices, Inc. v. Michalski, 2006 WL 3287382 (N.C. Super. Nov. 1, 2006) (Unpublished)

In this misappropriation of trade secrets case, defendants moved to compel the production of emails of the originators of the trade secrets at issue relating to the development of those trade secrets and products initially implementing them. At the hearing on the motion, the court ordered Analog to determine the search capability of the databases containing the emails requested and to conduct a word search, if possible, using agreed-upon terms, of emails sent by specific inventors over a two-year period surrounding the release dates of products implementing the alleged trade secrets. Counsel for Analog subsequently reported that it would produce emails still existing on the hard drives of the personal computers used by the trade secret originators. As to emails no longer existing on personal computers but stored on its backup server, Analog argued that production would be expensive and time consuming and therefore unduly burdensome.

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North Carolina Court Relies on Conference of Chief Justices' Guidelines in Two Decisions Involving the Production of Email from Backup Tapes

Posted on November 4, 2006 by K&L Gates

These two opinions, both filed on November 1, 2006, discuss for the first time the extent to which inaccessible electronic data is discoverable and who should pay for its production under the North Carolina Rules of Civil Procedure.

Bank of America Corp. v. SR Int’l Bus. Ins. Co., Ltd., 2006 WL 3093174, 2006 NCBC 15 (N.C. Super. Nov. 1, 2006)

Analog Devices, Inc. v. Michalski, Case No. 01 CVS 10614, 2006 NCBC 14 (N.C. Super. Nov. 1, 2006)

The Analog Devices case addresses the issues in the context of a party-to-party request for production of documents, and the Bank of America decision addresses those issues in the context of a subpoena to a nonparty. “In some instances the considerations are the same, and in others they differ dramatically. In both contexts, trial judges should be guided by the language of the applicable Rules of Civil Procedure, supplemented by the Guidelines adopted by the Conference of Chief Justices.”

The case names contain links to the opinions on the court’s website, and summaries will be posted on www.ediscoverylaw.com.

 

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Failure to Suspend Email Retention Policy Warrants Adverse Inference and Monetary Sanctions, but Not Default Judgment

Posted on November 3, 2006 by K&L Gates
In re Napster, Inc. Copyright Litig., 2006 WL 3050864 (N.D. Cal. Oct. 25, 2006)

In this opinion, the court denied plaintiffs’ request for spoliation sanctions in the form of a default judgment, and instead granted plaintiffs’ alternative request for a preclusion order, an adverse inference instruction and an award of attorneys’ fees. Plaintiffs’ motion for sanctions argued that defendant Hummer Winblad (“Hummer”) knowingly and intentionally deleted an undetermined number of emails which they had a duty to preserve and to produce in response to plaintiffs' document requests. Continue Reading...
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$1.888 Million Judgment Entered in Favor of Bankruptcy Trustee Based on Adverse Party's Spoliation of Financial Records

Posted on November 3, 2006 by K&L Gates
In re Quintus Corp., 353 B.R. 77 (Bankr. D. Del. 2006) 

Avaya, Inc. purchased the assets of the debtors in bankruptcy, and agreed to assume certain of the debtors’ liabilities. Thereafter, the trustee filed an adversary complaint against Avaya asserting breach of contract and unjust enrichment for failure to pay certain liabilities under the parties’ asset purchase agreement (“the APA”). The trustee sought judgment against Avaya in the amount of $1,888,410.52 for the unpaid claims. Continue Reading...
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