Recent ESI Court Decisions
	Practice Points: Improve the Quality of your Document Review Through Adequate Preparation
	News & Events

Recent ESI Court Decisions

Court Denies Request for Reproduction of Privileged Document as Untimely
Bro-Tech Corp. v. Thermax, Inc., 2008 WL 5210346 (E.D.Pa. Dec. 11, 2008). In this ongoing trade secrets misappropriation litigation, the plaintiffs sought production of a privileged document that the defendants previously "clawed back" pursuant to a voluntary clawback agreement. The defendants opposed the request, arguing that the challenge provision in the clawback agreement specifically called for written notice of plaintiffs' objection within five business days of the receipt of defendants' written demand for the return of the erroneously produced document. Because plaintiffs failed to follow the challenge provision of the clawback agreement, the defendants argued the motion was untimely. Analyzing the clawback agreement, the court found the plaintiffs' motion to be untimely and declined to order the defendants to produce the document.

Court Upholds Monetary Sanctions Finding Defendants' Alleged Lack of Preparation for Sanctions Hearing "Incredible"
Keithley v. Homestore.com, Inc., 2008 WL 5234270 (N.D.Cal. Dec. 15, 2008). In this ongoing patent infringement litigation, the defendants objected to the magistrate judge's report and recommendation for monetary sanctions. The defendants objected to the monetary sanctions arguing: (1) the spoliation of source code is not sanctionable; (2) they reasonably believed they had complied with a previous production order; (3) appropriate document retention and litigation hold policies were in place; and (4) sanctions, if warranted, should only be imposed on the defendant Move (formerly homestore.com). Declining to find the magistrate's report and recommendation erroneous, the court adopted the report.

Court Splits Costs of Privilege Review Due to Failure of Both Parties to Cooperate
Covad Comm. Co. v. Revonet, Inc., 2008 WL 5377698 (D.D.C. Dec. 24, 2008). In this trade secrets misappropriation litigation, the plaintiff moved to compel the defendant to reproduce e-mails in native format that were previously produced in hard copy. Having been written prior to the effective date of the amendments to the Federal Rules, the plaintiff's document production request did not explicitly include electronically stored information and failed to request a particular format for production. Magistrate Judge Facciola held that both parties played with fire by producing and accepting documents in hard-copy form, as they were not reasonably kept in hard copy form in the ordinary course of business. Therefore, Judge Facciola ordered the defendant to produce the requested information in native format on a CD and split the costs of privilege review (capped at $4,000) between the parties. Judge Facciola concluded by stating that, "two thousand dollars is not a bad price for the lesson that the courts have reached the limits of their patience with having to resolve electronic discovery controversies that are expensive, time-consuming, and so easily avoided by the lawyers' conferring with each other on such a fundamental question as the format of their productions of electronically stored information."

Court Denies Motion for Production of Metadata
Kingsway Fin. Serv's, Inc. v. Pricewaterhouse-Coopers LLP, 2008 WL 5423316 (S.D.N.Y. Dec. 31, 2008). In this fraud action, the plaintiff moved to compel the production of metadata for a number of produced documents. The court denied the motion, citing the plaintiff's failure to raise any issue as to the authenticity of the produced documents. Additional factors giving rise to the denial of the motion included the plaintiff's failure to identify the types of metadata sought and the failure to explain why metadata was relevant to the matter.

Court Adopts Magistrate Judge's Denial of Taxation of Costs Regarding E-Discovery Expenses
Klayman v. Freedom's Watch, Inc., 2008 WL 5111293 (S.D.Fla. Dec. 4, 2008). In this litigation, the defendants moved the court to tax the costs of their electronic discovery collection to the plaintiff. The defendants requested the plaintiff pay the $150,000 they spent for expenses incurred in hiring an outside firm to collect their electronic documents, including travel expenses. Applying 28 USC �1920, which provides for the taxation of costs for "fees for exemplification and copies of papers necessarily obtained for use in the case," the court denied the motion. The court refused to tax costs not specifically authorized by the statute, such as the hourly costs of collection at issue here.

Court Orders Public Office to Absorb Costs for Restoration of Deleted E-Mails
State ex. rel. Toledo Blade Co. v. Seneca County Bd. of Comm'rs, 2008 WL 5157733 (Ohio Dec. 9, 2008). In this litigation, the plaintiff filed an action seeking a writ of mandamus to compel the defendant to recover the content of requested e-mails that had been deleted. The plaintiff argued that a public office has an obligation to maintain certain records, such as the records at issue here, and make them available for inspection and copying under the Public Records Act. Finding substantial gaps in the responsive e-mails provided by the defendant, the court determined that a reasonable inference was raised that at one time, additional responsive e-mails were deleted in violation of the defendant's document retention schedule. Additionally, through an affidavit of a computer expert specializing in forensic data recovery services, the plaintiff established that there was some likelihood that the recovery of the deleted e-mails would be successful. Therefore, the court also concluded the defendant should be required to attempt to restore deleted e-mails. The court ordered the defendant to bear the expense of the forensic analysis but stated that the "recovery efforts need only be reasonable, not Herculean."

Court Issues Adverse Inference and Monetary Sanctions Due to Defendant�s Failure to Timely Produce Relevant Information
Gateway Senior Hous., Ltd. V. MMA Fin., Inc., 2008 WL 5142152 (E.D. Tex. Dec. 4, 2008). In this contract litigation, the plaintiffs moved for a determination of privilege waiver and sought sanctions, alleging the defendants withheld relevant information. The plaintiffs argued that privilege with regard to inadvertently produced e-mails was waived because the defendants failed to list them in a privilege log, and that sanctions were appropriate because two key hard drives were never produced. Conversely, the defendants argued that everything requested was produced and that privilege was timely asserted after notice of the disclosure. Finding the defendants failed to carry the burden of proving privilege and unreasonably delayed in disclosing the existence of the alleged privilege documents, the court held the attorney-client privilege was waived. Regarding sanctions, the court granted a discretionary adverse inference that the missing hard drives contained information unfavorable to the defendants evidenced by its failure to produce them along with reasonable expenses and attorneys fees associated with bringing the current motion.

Court Applies Federal Evidence Rule 502 and Declines to Find Waiver of Attorney-Client Privilege
Reckley v. City of Springfield, Ohio, 2008 WL 5234356 (S.D.Ohio Dec. 12, 2008). In this employment litigation, the defendant produced five e-mails of which it later claimed were protected by the attorney-client privilege and inadvertently produced. Therefore the defendant sought return of the e-mails and the plaintiff argued that the production waived the privilege. Applying Fed.R.Evid. 502(b), the court held that privilege was not waived. The court noted that at least some of the inadvertently disclosed e-mails were labeled "attorney-client privileged" and that the defendant took prompt steps to claim privilege and seek return of the e-mails after they were disclosed. The court also noted that the disclosure took place in the context of electronically stored information; a context particularly intended to be addressed by Rule 502.

Court Applies Federal Evidence Rule 502 and Finds Waiver of Attorney-Client Privilege
Relion, Inc. v. Hydra Fuel Cell Corp., 2008 WL 5122828 (D.Or. Dec. 4, 2008). In this patent litigation, the plaintiff moved to enforce a stipulated protective order and sought the return of two inadvertently produced e-mails, alleging they were attorney-client privileged. Analyzing the plaintiff's conduct using Fed.R.Evid. 502(b), the court determined that the plaintiff did not pursue all reasonable means of preserving the inadvertently produced e-mails. The court based its decision on the fact that the plaintiff did not assert privilege until four months after the e-mails were produced, and then only in response to a letter from defense counsel discussing the two e-mails and the fact that the plaintiff had multiple opportunities to inspect the documents prior to production. The court held that such behavior was tantamount to a failure to pursue all reasonable means of preserving the confidentiality of the documents, which resulted in waiver of the privilege.

Court Orders Reproduction of Electronic Data in Native Format
Superior Prod. P'ship v. Gordon Auto Body Parts Co., Ltd., 2008 WL 5111184 (S.D. Ohio Dec. 2, 2008). In this predatory pricing case, the plaintiff sought production of electronic documents in native format that were previously produced in hard copy. The defendants opposed native production, arguing their computer system did not maintain metadata and therefore no purpose would be served in native production. Citing Fed.R.Civ.P. 26's preference for native format production, the court ordered the defendants to produce the documents natively, finding benefit in the ease at which electronic documents can be stored and manipulated during the litigation process.

Court Denies Production Request for Hard Copies Finding Electronic Format Reasonably Accessible
Armor Screen Corp. v. Storm Catcher, Inc., 2008 WL 5262707 (S.D.Fla. Dec. 17, 2008). In this patent litigation, the defendants moved to compel production of consumer survey data relied upon in expert reports. The defendants requested hard copy printouts including all metadata that was previously produced in an allegedly "unusable" electronic .sav file format. The plaintiff opposed the motion, asserting that it produced all of its experts' survey data in the same format in which it was reviewed and analyzed, and that such files can be easily accessed with any standard statistical computer package. Finding the plaintiff's production complied with Fed.R.Civ.P. 34(b)(2)(E)'s requirement that data be produced in a reasonably accessible format, the court denied the defendants' motion as the defendants provided no materials to demonstrate that their rebuttal experts were unable to access or review the data.

To view additional case summaries visit www.krollontrack.com/case-summaries/.

Practice Points: Improve the Quality of your Document Review Through Adequate Preparation

Document review is known as one of the most dreaded aspects of litigation � a truly daunting process that, almost overnight, can devour discovery budget dollars in attorney review costs. Moreover, some trial lawyers find themselves in the quandary of having to choose between missing discovery deadlines or settling for an inadequate review in which the likelihood of inadvertent production of privileged documents is high. Despite challenges inherent in document review, there is good news: thoughtful and proactive planning can minimize review costs and provide a timely and complete examination of the evidence you need to win your case.

The critical first step of any document review project is to map or scope the project. Key issues to consider include the number of document pages (or data size) that must be reviewed, the types of media involved, time and budget constraints, and the substantive complexity of the information to be reviewed. Once the project is properly scoped, the next step is to develop a document review plan that encompasses all aspects of the review process. The plan should include detail regarding the people selected for the review team, the level of review expertise required in each phase of the review, whether contract or in-house attorneys are best suited, and production deadlines.

Once the document review team is identified, it must be properly trained. Training the review team involves technical training on the review tool as well as substantive training regarding the case itself. Creating a comprehensive training manual including a case summary, categorization and privilege instructions, and timeline milestones promotes accurate and consistent treatment of documents and a timely production schedule.

Quality control (QC) is an important aspect of a successful document review. QC serves as a protection against inadvertent privilege waiver and also provides documentation of your work quality. The key to successful QC is to sample your production data set early and often. Attorneys best positioned to QC documents are those who demonstrate a substantive understanding of the underlying case as well as the plan for review.

Document review is an integral and vital aspect of the litigation process. Proactive attorneys will improve the quality of the review and avoid unnecessary costs by properly scoping and planning the process from the outset. Once the document review plan is determined, savvy practitioners will take the time to adequately train the review team and put strong quality control measures in place. A poorly managed document review can produce disastrous results, while a strategically managed review will improve the likelihood of a positive case outcome. As such, prudent attorneys will take the time to get their document review plan and team positioned for success � before the first document is examined.

To view additional information on document review, visit www.krollontrack.com/document-review/.

News & Events

Kroll Ontrack Wins Big at this Year's Law Technology News Awards
Each year, Law Technology News recognizes vendors and law firms for their innovative use and implementation of technology in the litigation field. Vendor products and services are evaluated by LTN subscribers through an online voting system, and gold, silver and bronze honorees are chosen based on the number of votes. This year, Kroll Ontrack is proud to be the recipient of eight individual Law Technology News Awards. Furthermore, Kroll Ontrack's Legal Technologies products and services were recognized in each of the categories in which they were nominated.

Upcoming Webinar! The Golden Hour: When Every Minute Counts
Take this unique opportunity to hear from the experts during a one-hour webinar focused on issues affecting data security in the healthcare industry. Healthcare facilities intake, utilize and maintain the most desirable elements of a patient's confidential information � from personal health data to Social Security numbers and credit card information. In a setting where patients, visitors, volunteers, vendors, staff and others freely visit, a healthcare facility is ripe for information misuse. Additionally, the necessity for collaboration among departments, clinics and practitioners increases the chance of a data loss incident. Although it may seem easier to ignore the risk, the risk will not ignore you. This presentation will provide you with practical guidance from the experts in preparing for and dealing with a data breach in the healthcare industry. For more information and to register, please visit http://www.krollontrack.com/redir/feb09Healthweb-CLU.

The ESI Report � Podcasts for Attorneys Interested in ESI Trends
Kroll Ontrack has partnered with the Legal Talk Network to discuss cutting-edge issues and judicial opinions relating to electronically stored information (ESI). Michele Lange, Director of Kroll Ontrack Product Line Management, hosts the podcast series entitled "The ESI Report." A recent ESI Report podcast discussed ESI case-law developments in 2008 and predictions for the year ahead. Additionally, podcast listeners will be briefed by Kroll Ontrack's legal correspondents on the facts surrounding Covad Communications Co. v. Revonet, Inc. Stay ahead of the competition and download our podcasts at www.krollontrack.com/legal-technologies-podcasts/.

Kroll Ontrack Offers Redesigned E-Discovery Certification Course for 2009
The industry's legal technology thought leader has revamped its E-Discovery Certification Course for 2009 with updated topics, additional speakers and dual track, customizable sessions to appeal to beginner, intermediate and advanced learners. The redesigned course curriculum is ideal for legal and technical professionals of all levels, including in-house counsel, law firm attorneys, litigation support professionals, paralegals, IT staff and members of the judiciary. For more information and to register for an upcoming course, visit www.krollontrack.com/certification-courses/.

Meet our representatives at the following events:

Visit www.krollontrack.com/upcoming-events/ for more information on these events and others.

Back To Top

We Request Your Input

This newsletter was written by Regina Jytyla and Joni Shogren, Kroll Ontrack staff attorneys, with assistance from Kelly Kubacki and Meridith Socha, Kroll Ontrack law clerks. Ms. Shogren can be contacted by writing to jshogren@krollontrack.com.

For more information about electronic discovery and computer forensics services, contact Kroll Ontrack at 800 347 6105 or visit www.krollontrack.com.