This is the second post in a four-part series on electronic discovery by Christian & Small Partner J. Paul Zimmerman. Click here to read Part I, here for Part III, and here for Part IV.
Electronic Discovery: It All Starts With Preservation
In our last post, we covered what electronic discovery is and some simple steps for better management. Next, attorneys should always undertake electronic information preservation efforts. Though many lawyers and parties in litigation are frequently concerned about spoliation sanctions, they are fortunately rare. If data is preserved, the chance of sanctions for spoliation are essentially nil, though failing to produce electronically stored information (“ESI”) or altering it along the way are still potential problems (and sanctionable).
The law requires reasonable efforts in preserving evidence. Allowing the client to take steps to search for, identify, and preserve relevant information is known as “self preservation.” In many cases, self preservation may be permissible as reasonable efforts, particularly in small cases, where the data involved is simple and not voluminous, and the capabilities of taking reasonable efforts to find and identify relevant data can be demonstrated. There are certainly circumstances under which self preservation or self collection is not reasonable, particularly if the party does not have sufficient resources by which to preserve and collect data without altering it in a way that affects the case, or a clear incentive to allow evidence to be lost can be shown. Obviously, self preservation or collection is not without risk and must be weighed within the context of the case.
Attorneys have a duty to advise their clients regarding the preservation of evidence. This is nothing new. However, what is new with electronic data is that it can be extremely fragile. Historically, documents were kept in filing cabinets, and those cabinets were often locked or kept in a locked office. While the impetus and ability to destroy relevant evidence has always existed, accidental loss of evidence has historically been less of an issue in most cases than it is today, because short of a fire or a flood where the documents are stored, they were generally available.
Today, that evidence may be on a laptop computer, which is subject to having a drink spilled on it, or on a smartphone, which can fall out of a pocket or get left on top of a car at any time. Furthermore, thumb drives get lost all the time. Careless loss of data should be prevented. Obviously, parties or reluctant witnesses can “delete” computer data at the touch of a button, thereby requiring forensic computer analysis and a measure of luck to recover it. Furthermore, the volume of hardcopy information, both relevant and not relevant, was limited and in an understandable filing system. ESI is voluminous and is not always organized and stored in a manner understood by most people.
While the duty to preserve evidence can be statutory, regulatory or even contractual, the most common source of a duty to preserve relevant evidence is a reasonable anticipation of litigation. Once a duty to preserve relevant data is triggered, litigants must take reasonable efforts to preserve data that is potentially relevant to the litigation.10 The date on which litigation was reasonably anticipated can be different for the different parties, since it is often not triggered for the defendant until the defendant is served with the summons and complaint. Various indicators of a reasonable anticipation of litigation can be an EEOC charge, a demand letter from an attorney, or a greater than usual internal investigation by the (potential) defendant.
Preservation is a process that requires a system and monitoring. It is not a one-time event (i.e., the litigation hold memo), and most courts impose on counsel a duty to assist clients in preservation efforts and to then monitor compliance. Preservation begins with counseling the client on the client’s obligations regarding preservation and assisting the client in those efforts, including identifying, locating, and protecting relevant data. Must we always send a written litigation hold letter to our clients? Not under Alabama law. Is it the prevailing best practice? Absolutely.
Stated otherwise, can it be said that the best practice is to rely upon a verbal litigation hold instruction? No. Consider how simple or comprehensive to make a written litigation hold, but regardless of the complexity of the case, the data, or the environment containing the data, the hold notice should be clear, understandable, and as concise as possible, with practical instructions. With institutional clients, inquire as to the preservation efforts to date and whether the client is looking to outside counsel to take the lead in those efforts. Document the discussion. Take into account past engagements, if any. Set reminders/ticklers to send periodic written reminders to the client given the commonly imposed duty of counsel to supervise preservation efforts.
Instructions for a litigation hold, whether written or verbal (which must be documented in the file), must inform the client: (a) how to determine what data is relevant; (b) what type of data must be preserved; (c) how to preserve it; (d) what to do with it; and (e) must advise the client to continue preserving new data generated subsequent to the litigation hold. Enough information about the litigation must be provided in order to allow the client (and its employees, if the client is an organization) to discern what information is potentially relevant.
While it is possible to simply request that the client preserve all information, in whatever form, regarding a certain event, person, or period of time, this is probably overly broad and imposes a hardship on the client in a number of ways. Automatic deletion of relevant files and email must be suspended. Consider whether self preservation/collection of documents by the client is reasonable (i.e., defensible) in the case at hand or whether a vendor needs to be involved in those processes. The hold notice should contain contact information for questions, additional information, or assistance. Determine whether to preserve data in place or require collection of potentially relevant data to ensure against spoliation, either intentional or otherwise.
Pull back-up tapes for relevant time periods out of rotation if they might contain relevant evidence. Do not forget about text messages and other more obscure or personal data sources, such as tablets, thumb drives, online repositories (such as the employee who emails documents to himself via Gmail to work on the weekend), etc., or personal devices owned by employees that were used for work. And of course, social media is ubiquitous and must always be explored as possible data sources, especially as to the employees involved in the controversy. Again, given the mind boggling (and every increasing) types and sources of data, checklists are a must. Many courts in the Eleventh Circuit have held that counsel has a duty to monitor clients, and if counsel does not ask, counsel cannot do that.
As such, in addition to the duty to advise clients about not intentionally destroying evidence, counsel is obligated to advise clients how to take reasonable precautions against accidental loss. Even though the standard for adverse inferences in both Alabama and the Eleventh Circuit is bad faith, even an accidental or negligent loss of data can seriously impact a case in any number of ways. First, imagine the value of the client’s case if counsel does not have the video file depicting the slip and fall, the cell phone pictures of the injury snapped while waiting for sutures, or the lack of any bruises or abrasions immediately after the incident giving rise to litigation. Sure, a witness can testify to these things, but it certainly may not be the same. Second, most cases do not have enough at stake to support or justify building a case for or against spoliation. Litigation is much more cost effective without having to undertake such additional efforts. Third, a finding of bad faith can occur more easily than one might think under certain circumstances.
Counsel must be prepared to defend as reasonable the steps taken to preserve and collect relevant information. Never assume the client’s IT personnel have the knowledge to adequately preserve and collect data without changes to the data. Inquire. Just like attorneys, who do not all practice
in the same areas, IT personnel do not necessarily know all aspects of information technology. A database administrator is different from a network engineer, which may not have the same skills and knowledge as a helpdesk representative. Smaller companies have IT personnel that wear many hats (or contract out IT functions altogether) and may not necessarily know how to collect electronic data without altering metadata (which may later be deemed spoliation). If the client cannot adequately preserve and collect data without altering it, use a vendor to preserve and collect ESI.
Work with the client to identify who has control of relevant information and where the information is located. All employees of a client who control relevant information should be given instructions on what to preserve and how to preserve it. Identify third-parties who may have relevant information, too (more on that later). Finally, if the client is a company, remember the possibility of employees using personal devices (such as iPads, laptops, etc.) for work and therefore include such devices in the analysis of potential sources of data that must be preserved and searched because they are likely to be deemed to be within the “possession, custody, or control” of the client.
A litigation hold notice must be circulated not just to players involved in events underlying the litigation, but potentially to several other people or departments. The notice should go to IT, human resources, the administrative assistants of custodians of information, potentially the immediate superiors of custodians, and anyone else who may have responsibility for repositories of relevant data. Always be mindful of the need to change or update a litigation hold as facts of the case change, new custodians are discovered, new data or types of data are found, and so on. Document who receives litigation holds, when the holds are acknowledged, when the recipients are reminded of the duty to preserve, and any further communication regarding preservation.
Always consider whether to send preservation demands to opposing counsel and/or to third-parties. Again, the individual case may or not require it, and counsel may have tactical considerations as to whether to send a written preservation demand. However, counsel should always consider whether a preservation demand is needed. When drafting the language, scope, and preservation steps requested, counsel must always assume that the same letter may be received back from its recipient asking counsel’s client to undertake the same steps requested. That being said, it is possible that what is considered reasonable efforts for one party, or in one case, may differ for another. Specify, to the degree evidence is known, what that evidence is that must be preserved.
This post, as well as the others in this series, was excerpted from Zimmerman’s “It’s All Electronic Discovery” article in the spring issue of the Alabama Defense Lawyers Association Journal magazine. Click here for the full article.