Electronic Discovery Law

Legal issues, news and best practices relating to the discovery of electronically stored information.

 

1
In Patent Case, Court Indicates Importance of Damages Disclosures to Proportionality Calculation
2
Court Allows Deposition of Court-Appointed Forensic Expert, Cites Benefit to the Court, Orders Special Master to Participate in Questioning
3
Supreme Court Approves Proposed Amendments to Federal Rules of Civil Procedure, Submits Proposals to Congress for Approval
4
Court Imposes “Death Penalty Order” for Discovery Violations, Rejects Reliance on Retention Policy
5
What the judges think: e-discovery practices and trends
6
No Sanctions for Discovery Failures Resulting from Court-Ordered Seizure of Defendants’ Books and Records in a Separate Case
7
“[A] a party is not required to preserve all its documents but rather only documents that the party knew or should have known were, or could be, relevant to the parties’ dispute.”
8
Sixth Circuit Affirms Recovery of e-Discovery Costs for Imaging Plaintiff’s Computer
9
Upcoming Events
10
“The power of a U.S. Court to require compliance with U.S. discovery obligations does not arise until and unless the Court has jurisdiction.”

In Patent Case, Court Indicates Importance of Damages Disclosures to Proportionality Calculation

Corning Optical Commc’ns Wireless Ltd. v. Solid, Inc., No. 5:14-cv-03750-PSG, 2015 WL 1726749 (N.D. Cal. Apr. 14, 2015)

In this patent infringement case, the court addressed the “classic chicken-and-egg” problem of requiring initial disclosures regarding damages where “[t]o provide meaningful calculations, patentees need lots of information from accused infringers. But the expense of producing lots of information can only be justified by a meaningful calculation suggesting that substantial dollars are actually at stake.”  The court explained that despite significant discovery in the present case, including the exchange of “reams of data,” “neither side ha[d] any firm sense of whether this [was] a $1 case or a case worth billions.”  Moreover, the court explained, “the parties here are not unusual.  For years it has been the norm in patent cases to bludgeon first and value second.”  In granting Defendant’s motion to compel, the court acknowledged that the information sought was not only important to the defendant, but also to the court, stating: “Proportionality is part and parcel of just about every discovery dispute.”

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Court Allows Deposition of Court-Appointed Forensic Expert, Cites Benefit to the Court, Orders Special Master to Participate in Questioning

Procaps S.A. v. Patheon, Inc., No. 12-24356-CIV, 2015 WL 1880346 (S.D. Fla. Apr. 24, 2015)

In this opinion, the court addressed Defendant’s motion to take the deposition of the court-appointed, neutral, computer forensic expert who conducted a forensic analysis of Plaintiff’s electronic media and discovered a number of deletions. Plaintiff and Defendant differed regarding the meaning of the expert’s report and filed competing summaries. Accordingly, Defendant sought to conduct a deposition of the expert. The court granted the motion, noting the importance of the deposition in assisting the court to understand the issues before it and ordered a specific deposition protocol, including that the Special Master conduct a portion of the questioning.

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Supreme Court Approves Proposed Amendments to Federal Rules of Civil Procedure, Submits Proposals to Congress for Approval

Today, April 29, 2015, Chief Justice John G. Roberts submitted the proposed amendments to the Federal Rules of Civil Procedure which “have been adopted by the Supreme Court of the United States” to Congress for final approval.  Absent legislation to reject, modify or defer the rules, they will become effective December 1, 2015.

A copy of the Supreme Court’s submission to Congress is available here.

Court Imposes “Death Penalty Order” for Discovery Violations, Rejects Reliance on Retention Policy

Crews v. Avco Corp., No. 70756-6-I, 2015 WL 1541179 (Wash. Ct. App.  Apr. 6, 2015)

In this case, the trial court held Defendant in contempt and ultimately imposed a “death penalty order” for discovery violations, including the failure to produce relevant information.  Notably, the trial court rejected Defendant’s reliance on its document retention policy as an explanation for why the information was unavailable.  On appeal, the appellate court affirmed the imposition of sanctions but remanded for amendment of the final judgment to reflect any offsets authorized by statute.

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What the judges think: e-discovery practices and trends

by Daniel Miller and Tina Miller

This article was originally published in the Lawyers Journal, The Journal of the Allegheny County Bar Association, April 3, 2015.

A recent survey of leading federal jurists indicates that many attorneys need to improve their knowledge and practices regarding e-discovery.

The “Federal Judges Survey on e-discovery Best Practices and Trends,” commissioned by the e-discovery software firm Exterro, reflects responses from 22 federal district and magistrate judges, including the Western District of Pennsylvania’s Chief Judge Joy Flowers Conti, Judge Nora Barry Fischer and Magistrate Judge Lisa Pupo Lenihan.

The judges were asked 15 multiple-choice questions covering a number of e-discovery topics. Despite the numerous and varied e-discovery seminars and training sessions currently available to practitioners, the survey results indicate that many attorneys still lack e-discovery competency. In particular, the judges complained about two main problems – a lack of knowledge about their clients’ e-discovery environment and a lack of cooperation between opposing parties and attorneys.

To read the full article, click here. Reprinted with permission from the Lawyers Journal.

To access the Federal Judges Survey on e-Discovery Best Practices and Trends, click here.

No Sanctions for Discovery Failures Resulting from Court-Ordered Seizure of Defendants’ Books and Records in a Separate Case

Perez v. Metro Dairy Corp., No. 13 CV 2109(RML), 2015 WL 1535296 (E.D.N.Y. Apr. 6, 2015)

Plaintiffs in this collective action sought spoliation sanctions for Defendants’ failure to produce certain relevant evidence, including payroll records, W-2s, cashier sheets, etc.  Defendants objected to the motion on the grounds that “all of their books, records and computers were seized” pursuant to the court’s order in a different case and that there was no opportunity to make any copies or back ups.  Accordingly, the court reasoned that Defendants had not destroyed their records and found that “[u]nder the specific circumstances of this case … defendants did not have an obligation to copy their books and records before complying with the court order.”  The court also reasoned that even if Defendants did have an obligation to preserve, there was no evidence of Defendants’ requisite culpable state of mind.  Plaintiffs’ motion for sanctions was denied.

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“[A] a party is not required to preserve all its documents but rather only documents that the party knew or should have known were, or could be, relevant to the parties’ dispute.”

Blue Sky Travel & Tours, LLC v. Al Tayyar, —Fed. Appx.—, 2014 WL 1451636 (4th Cir. Mar. 31, 2015)

In this case, a magistrate judge imposed severe sanctions for Defendants’ failure to preserve “all documents” once litigation began.  Specifically, the magistrate judge held that “once litigation began, [Defendants] had a duty to stop its document retention policies ‘and to preserve all documents because you don’t know what may or may not be relevant.’ (Emphasis added.)”  The sanction was upheld by the district court and resulted in a $10 million award for lost profits damages.  On appeal, however, the Fourth Circuit found that the “standard applied by the magistrate judge constituted an abuse of discretion, because a party is not required to preserve all its documents but rather only documents that the party knew or should have known were, or could be, relevant to the parties’ dispute.”  Accordingly, the circuit court vacated the lower court’s profit-based damages award and remanded the case for a determination regarding: 1) when Defendants should have known that the at-issue evidence  (original invoices) could be relevant; 2) when the at-issue evidence was destroyed; and 3) whether a new trial on lost profits damages was necessary.

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Sixth Circuit Affirms Recovery of e-Discovery Costs for Imaging Plaintiff’s Computer

Colosi v. Jones Lang LaSalle Amers. Inc., 781 F.3d 293 (6th Cir. 2015)

In this opinion, the court addressed the recovery of taxable costs related to e-Discovery and concluded that “a plain reading of the statute authorizes courts to tax the reasonable cost of imaging, provided the image file was necessarily obtained for use in the case.”  Accordingly, the circuit court affirmed the lower court’s award related to the cost of imaging Plaintiff’s personal computer. Read More

Upcoming Events

Strafford – E-Discovery Strategies: Preparing for New FRCP Amendments on Proportionality and Managing ESI

April 14, 2015
1-2:30 PM EDT
Webinar

Join K&L Gates attorney Bree Kelly and her fellow panelists for a discussion of “E-Discovery Strategies: Preparing for New FRCP Amendments on Proportionality and Managing ESI.”  The discussion will cover a range of topics, including a review of the proposed amendments to Federal Rules of Civil Procedure 26(b)(1) and 37(e), strategies for achieving proportionality, best practices for preserving ESI and avoiding sanctions, best practices for information management and a review of court decisions addressing proportionality.

To learn more or to register, click here.

PBI – eDiscovery Symposium

April 17, 2015
PBI Professional Development Conference Ctr.
Heinz 57 Center, 339 Sixth Ave, 7th Floor
Pittsburgh, PA

Join K&L Gates partner Thomas J. Smith for a day of e-Discovery.  Mr. Smith will participate in two of the day’s nine informative panels.  First, at 11:20, join Mr. Smith and a panel of experts for a discussion of proposed amendments to both local and federal rules (“Amendments to FRCP/Amendments to local rules).  Then, at 3:00, Mr. Smith will moderate a panel of judges (Chief Judge Conti, Judge Kelly, and Judge Lenihan) in a roundtable discussion of important topics affecting e-Discovery practice in Federal Court (“e-Discovery Practice in Federal Court: Judges’ Roundtable Discussion).

To learn more or to register, click here.

“The power of a U.S. Court to require compliance with U.S. discovery obligations does not arise until and unless the Court has jurisdiction.”

Lunkenheimer Co. v. Tyco Flow Control Pacific Party Ltd., No. 1-11-cv-824, 2015 WL 631045 (S.D. Ohio Feb. 12, 2015)

In this case, the court addressed several discovery issues, including the question of when Defendant’s duty to preserve arose.  The Intervenor/Counter Defendant asserted the duty arose in 2002.  Defendant—an Australian Corporation—asserted the duty could no t have arisen before August 2012, when it consented to U.S. jurisdiction and, “even if it had, it was not before [Defendant] was served on December 8, 2011.” Acknowledging that the defendant was not excused from the preservation obligation merely because it is a foreign company, the court nonetheless determined that because Defendant was an Australian company with no presence or significant sales in United States and because Australia was the anticipated jurisdiction of “License-related disputes,” the duty to preserve arose when Defendant was served with the complaint in December, 2011:

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