In re Veeco Instruments, Inc. Sec. Litig., 2007 WL 983987 (S.D.N.Y. April 2, 2007)
In this securities class action, defendants resisted lead plaintiff’s motion to compel production of email and other non-privileged documents. Defendants argued that restoring the backup tapes and searches involved would be extraordinarily burdensome and costly, and that such costs should be shifted to plaintiff. The court observed that, “[s]urprisingly,” the parties had not entered into an agreed protocol for electronic discovery, nor had they discussed the issue of searching backup tapes. It also found that, given the lack of discussion on the subject, it would be unreasonable for plaintiff to assume that backup tapes were being searched.
The court noted that amended Fed. R. Civ. P. 26(b)(2) provides that the responding party must identify the sources containing potentially responsive information that it is neither searching nor producing. “The fact that such discovery would be burdensome and not reasonably accessible, as the Court finds here, requires the requesting party to show good cause in accordance with Rule 26(b)(2)(C).”
The court went on to find that good cause was demonstrated by the plaintiff:
E-mails sent or received by Defendants relating to the issues herein could constitute important relevant evidence and are reasonably calculated to lead to admissible evidence. It has not been demonstrated that said information is reasonably available from any other easily accessed source. The discovery requests are specific. The resources of the parties are not an issue.
Accordingly, the court directed that the defendant restore the backup tapes for the relevant time period to produce the requested non-privileged documents. The court further ruled that defendant would bear the expense of the production initially, but that it should submit an affidavit detailing the results of its search, as well as the time and money spent. The court would then conduct the appropriate cost-shifting analysis using the framework set out in Zubulake v. UBS Warburg LLC, 217 F.R.D. 309 (S.D.N.Y.2003).