EDD Update

Law Technology News Daily Alert

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The Aleynikov Affair: From Newark with Code

In D.C. last week, I spoke to a group of data security specialists and computer forensic experts about the type of case I see most frequently.  Unlike most in the audience, I work in civil litigation and see little of the child porn, identity theft and hacking cases that occupy them.  Much of my work concerns alleged employee data theft, so I addressed the prevelance and patterns of those cases, discussing incident response fundamentals, e.g., what to preserve and where and how to look to determine the whether, when, who and how much of proprietary data theft.

I was fortunate the day's big news story was of a lately-resigned senior programmer at Goldman Sachs arrested at Newark airport for allegedly spiriting away a copy of Goldman's trading program code.  My topic seemed ripped from the headlines.

Preservation of Disaster Recovery Backup Tapes?

From John Jablonski, partner, Goldberg Segalla*:

Do you need to preserve disaster recovery backup tapes that contain relevant ESI? Guidance from commentators and case law is mixed. The Federal Rules of Civil Procedure are silent on whether disaster recovery backup tapes need to be preserved when implementing a litigation hold. What we know, however, is that all relevant ESI must be preserved. Relevant ESI can be contained on backup tapes that a party deems not reasonably accessible. See FRCP 26(b)(2)(B). Assuming backup tapes are preserved and identified as not reasonably accessible, will the tapes ever be subject to discovery? In short, yes as demonstrated by Kilpatrick v. Breg, Inc., 2009 WL 1764829 (S.D. Fla. June 22, 2009).

In Kilpatrick the court ordered production of disaster recovery backup tapes, despite defendant's argument that ESI on the tapes is not reasonably accessible. While the case does not address the question of preservation directly, it stands as a warning. Defendant repeatedly represented that active ESI met its discovery burden. Defendant also advised that additional relevant ESI might be contained on backup tapes, designated as not reasonably accessible because they were maintained for disaster recovery purposes only. Plaintiff was not buying it and moved to compel production of the backup tapes. The court agreed that the ESI produced so far seemed to have some holes and compelled limited production from the backup tapes.

From John Jablonski, partner, Goldberg Segalla*:

Do you need to preserve disaster recovery backup tapes that contain relevant ESI? Guidance from commentators and case law is mixed. The Federal Rules of Civil Procedure are silent on whether disaster recovery backup tapes need to be preserved when implementing a litigation hold. What we know, however, is that all relevant ESI must be preserved. Relevant ESI can be contained on backup tapes that a party deems not reasonably accessible. See FRCP 26(b)(2)(B). Assuming backup tapes are preserved and identified as not reasonably accessible, will the tapes ever be subject to discovery? In short, yes as demonstrated by Kilpatrick v. Breg, Inc., 2009 WL 1764829 (S.D. Fla. June 22, 2009).

In Kilpatrick the court ordered production of disaster recovery backup tapes, despite defendant's argument that ESI on the tapes is not reasonably accessible. While the case does not address the question of preservation directly, it stands as a warning. Defendant repeatedly represented that active ESI met its discovery burden. Defendant also advised that additional relevant ESI might be contained on backup tapes, designated as not reasonably accessible because they were maintained for disaster recovery purposes only. Plaintiff was not buying it and moved to compel production of the backup tapes. The court agreed that the ESI produced so far seemed to have some holes and compelled limited production from the backup tapes.

E to the F Power

Along with Ralph Losey, Tom O'Connor and other commentators, I've painted many a pixel importuning lawyers to learn the ways of electronic discovery.  Between us, we've variously employed the "M" word (malpractice), the "E" word (ethical duty), the "C" word (competitive advantage) and the "S" word (sanctions).  I don't know that any of us have gotten much traction.

But now a court has used the "F" word...the one that really grabs lawyers by the short hairs: fees

California's New Electronic Discovery Act Signed into Law

On June 29, 2009, California Governor Arnold Schwarzenegger signed into law the Electronic Discovery Act.  As an overview, California's new e-discovery rules are comparable to the changes to the FRCP in December 2006.  The California Electronic Discovery Act amends and adds to the California Code of Civil Procedure to provide a series of procedures for a litigant to discover or object to discovery of Electronically Stored Information (“ESI”).  The Act incorporates into the Code many of the same provisions regarding ESI found in the Federal Rules of Civil Procedure ("FRCP"), so practitioners familiar with the changes to the FRCP in 2006 will understand many of the new provisions in the amended Code. The Act took immediate effect and thus litigants in California courts are expected to immediately comply with them.  One noticeable mention is that the act requires the parties to meet and confer regarding discovery of ESI 45 days prior to the case management conference regarding discovery in California state court.

To read the Act, please click here.

Eternal September

As we mark the 233rd anniversary of our nation's founding with fireworks, Sousa marches and cookouts, I'm quietly looking back a scant thirty years, to the birth of USENET, and marveling at how far that once-great network has fallen.  Oddly, USENET figures prominently in an interesting new e-discovery sanctions decision.

Gather round, kids, and let L'Éminence Grise regale you with tales of yore, long before the Web, when dial-up bulletin boards were the bleeding edge and USENET messaging was bitchin'.  You iPod-addled whippersnappers with your forae, blogs and tweets think it's all so new.  In my day, we had to rise early and trudge through the snow to stack our TCP/IP...what's that...you don't care how pioneers poured the foundation for electronic expression and fashioned Perez Hilton from a lump of clay and a dash of silicon?

Over There: Where Angels Have No Fear to Tread

I am late to the party in discussing the case of Digicel et al v. Cable & Wireless, et al.  Others, including the extraordinary Chris Dale and the magnificent Sharon Nelson, long ago put their stamp on the case.  The peripatetic Sultan of Search, Jason Baron, even guest blogged it for the prolific Ralph Losey.  But as it was decided "Over There," and Sir Andrew Lloyd Webber hasn't set it to music, I paid it little heed. 

But lately, I'm obsessed with sensible ways to improve keyword searches and practical means to test searches before they're trotted out against vast swaths of ESI.

Mr. Justice Morgan's opinion is the rare case where a jurist closely analyzed the efficacy and burden of particular keywords for electronic search--an undertaking that U.S. Magistrate Judge John Facciolla artfully characterized as a fool's errand for lawyers and judges.  Still, once we change the "esses" to "zeds," there's much we Yanks can learn from the Digicel decision.

You've Got Mail...and We've Read It

My friend Marni Willenson, a noble, energetic advocate for Farmworker Justice, shared a new appellate decision from New Jersey addressing whether employees have reasonable expectations of privacy in privileged e-mails sent and received using employer systems.  It's one of those frustrating cases where the court reached a just result but made an unholy mess of the law along the way.

In Stengart v. Loving Care Agency, Inc. et al. (Docket No. A-3506-08T1, published June 26, 2009) , a three judge panel of the New Jersey Appellate Division ruled that, notwithstanding written policies to the contrary, an employee has a reasonable expectation of privacy in e-mails sent and received with her personal counsel via an employer-owned laptop.  The Court remanded the case for a determination of appropriate sanctions, including possible disqualification of the employer's counsel.  The court could have reached the same result on a narrow rationale, but, badda bing, chose a path that will make e-discovery harder and riskier.

Textbook Case of Discovery Abuse Exposes a Fallacious “Pig in a Poke” Defense

Defense counsel in Atlanta tried the old "pig in a poke" defense recently. Senior Judge J. Owen Forrester figured it was a ruse, just like the medieval derivation of the phrase, and sanctioned defendants. Kipperman v. Onex Corp., 2009 WL 1473708 (N.D.Ga., May 27, 2009). Judge Forrester called it a "textbook case of discovery abuse" and imposed sanctions of over One Million Dollars. The new case is all written up in this week's e-Discovery Team Blog.

So what does "pig in a poke" mean anyway? It is a confidence trick originating in the Late Middle Ages when meat was scarce, but not rats and cats.  According to Wikipedia, whom I believe is correct in this instance, "the scheme entailed the sale of a "suckling pig" in a "poke" (bag). The wriggling bag would actually contain a cat — not particularly prized as a source of meat — that was sold to the victim in an unopened bag." The idiom is commonly used today to refer to a risky purchase without inspecting the item beforehand. Typically it suggests that you would be a fool to make such a purchase and so should not do it. A related phrase is to "let the cat out of the bag," meaning 'to reveal that which is secret.'

So what does this have to do with e-discovery? Defense counsel in Kipperman argued that there was no way to know if any email of value existed on backup tapes, so it would be a mistake to spend the large sums of money needed to look. He suggested that there probably were no emails of value on these tapes. The judge later decided the attorneys knew all along, or at least should have known, that the tapes were in fact filled with cats, I mean, smoking gun emails, and the argument was a ruse. Fun case, except for defendants of course, as I explain in the full write up.

Judge Sotomayer - Technology Opinions

Could Judge Sotomayer be the first Justice to sit on the Supreme Court who has written technology related opinions before joining the court?  Since my last blog, I have been doing some research on Judge Sotomayer, the nominee for the Supreme Court.  I thought I would share with you some cases that may be of interest to those of us involved in eDiscovery. 

• In Specht v Netscape, she wrote a decision regarding the placement of a download button on a web page. All in all, she denied the defendant's motion to compel arbitration as it was believed that the Plaintiff was not a direct beneficiary under the agreement.
• In Storey v Cello, she wrote an opinion that an adverse outcome from an admiminstrative proceeding did not have preclusive effect on a suit brought under the  the Anticybersquatting Consumer Protection Act.
• In Mattel v. Barbie-club she rejected the argument that the federal court jurisdiction could be created in any federal district merely by providing written evidence of the domain registration with the trial court.

Although, these are not specific eDiscovery opinions, they are interesting as they give some insight into her technology savviness.

Will Wiping Warrant a Whipping?

Suppose a company sues a former high level employee claiming the employee absconded with proprietary company data in order to use the data in a competitive venture.  If the former employee installs a file wiping program called SureDelete on her laptop and wipes files, has the defendant committed spoliation?  Should sanctions necessarily follow?

What if the defendant only deleted highly sensitive personal data, e.g., personal income tax data and pornographic material, but swears not to have deleted any information relevant to the issues in suit?  Even with a litigation hold in place, can't a litigant continue to delete irrelevant and non-discoverable ESI?  I'm not asking if it's a good idea.  It's risky as hell.  I'm only asking if it's per se sanctionable?

Now let's add a wrinkle:

Introducing the Wonder Blunder Award

Almost 35 years ago, the late Senator William Proxmire introduced his infamous Golden Fleece awards recognizing instances of wasteful government spending.  Though a few Golden Fleece honorees may have been undeserving, most were absurd misuses of taxpayer dollars and warranted the public opprobrium the award bestowed.  Reading a recent opinion from a federal court in Florida, I decided that the electronic discovery industry needed its own Golden Fleece, something to highlight boneheaded moves, obstructive behavior and so forth.  My goal will be to sift a snippet of sense from the ashes of error, to seek some good for all in the flubs of a few.  So, I now announce the Wonder Blunder Award.

“Computer gobblydegook is not confusing or prejudicial.”

That’s a quote from U.S. Magistrate Judge David Nuffer’s 3/30/09 decision and order in Phillip M. Adams & Associates, L.L.C. v. Dell, Inc., et al., 2009 WL 910801 (D.Utah).  It’s a decision nigh overflowing with quotable quips, and one sure to elicit a few groans from companies too-wedded to custodial preservation as the primary method of legal hold.  Plus, the Court’s articulation of a need for “accountability to third parties in the design of information management practices” will raise some eyebrows  high enough to qualify them as a comb over.

Important 4th Circuit Ruling Protects Email Privacy

Ralph Losey here to report on an important new opinion by the Fourth Circuit Court of Appeals ruling in favor of an employee whose employer read her personal AOL email account. Van Alstyne v. Electronic Scriptorium, _F.3d_, 2009 WL 692512 (4th Cir. March 18, 2009). The case concerns self-help e-discovery. A boss accused of sexual harassment hacked into the accuser's AOL account in search of good email to use against her. He may have also done it for kicks. Read my latest blog and judge for yourself. Aside from some interesting facts, this case raises important issues on email privacy and attorney ethics. It looks like the tide is beginning to turn in favor of individual privacy rights. 

Wake Up Call for New York Lawyers!

A new case out of Manhattan makes clear with the following words that all lawyers in New York who do discovery had better improve their game: 

"This Opinion should serve as a wake-up call to the Bar in this District about the need for careful thought, quality control, testing, and cooperation with opposing counsel in designing search terms or “keywords” to be used to produce emails or other electronically stored information (“ESI”). While this message has appeared in several cases from outside this Circuit, it appears that the message has not reached many members of our Bar." 

William A. Gross. Constr. Assocs., Inc. v. Am. Mfrs. Mut. Ins. Co., 2009 WL 724954 (S.D.N.Y. Mar. 19, 2009). Download GROSS CONSTRUCTION-EDisc The opinion cites to Judges Grimm and Facciolla and their prior decisions on the need for expertise in search. This is a welcome message to attorneys like me who make their living studying and inventing ESI search methodologies. The efforts of the lawyers in this case were laughable, and once again show the need for both search expertise and cooperation.  Read on for the excellent concluding paragraph by Judge Andrew Peck:

Statistical Sampling's Rise to Fame

Since the Zubulake opinions, statistical sampling has taken a slow rise to fame and is just recently getting its due respect due to its measurability and defensibility. Zubulake v. UBS Warburg, 217 F.R.D. 309 (S.D.N.Y. 2003) set an early precedent of using statistical sampling of backup tapes to determine whether they might hold relevant e-mail messages that would justify their wider restoration.

I recognize that statistical sampling may be unfamiliar territory to many attorneys and their staff, but with a little research you will see that the statistical sampling method of proof has received universal acceptance in quality assurance testing in both manufacturing and most government agencies.  Even in man’s earliest history, we have seen the use of statistical tools in many different industries. 

Court grants plaintiff's motion for sactions for deletion of data

Technical Sales Assocs., Inc. v. Ohio Star Forge Co., Nos. 07-11745, 08-13365 (E.D. Mich. Mar. 19, 2009)

In this case arising from a dispute over sales commissions, the court denied Defendant Ohio Star Forge Company’s (“OSF’s”) motions for contempt and sanctions and granted plaintiff, Technical Sales Associates, Inc.’s (“TSA”), motion for sanctions for destruction of electronic evidence.  The court concluded that OSF deleted approximately 70,000 files and moved several email folders to the recycling bin despite a duty to preserve relevant evidence.  Read the entire post at ediscoverylaw.com.

Court Addresses Anonymous Internet Speech

Indep. Newspapers, Inc. v. Brodie, 2009 WL 484956 (Md. Feb. 27, 2009)

In this defamation case, plaintiff/appellee Brodie sought to enforce a subpoena to compel the production of the identities of several persons who posted allegedly defamatory statements about the plaintiff, anonymously, on defendant/appellant Independent Newspaper’s (“Independent”) Internet forum.  The circuit court granted Brodie’s motion and ordered Independent to identify the anonymous forum participants.  Independent appealed.  Finding that the circuit court abused its discretion when it denied Independent’s motion for a protective order because “Brodie had not pleaded a valid defamation claim against any of [the anonymous forum participants],” the appellate court vacated the prior judgment and remanded the case with instructions to grant defendant’s motion for a protective order and quash the subpoena.  Read the entire post at ediscoverylaw.com.

Better to Fetter Prompts Letter

I get "letters to the editor" pretty often, but since no one but me wants to read the many nice things people offer, I  feel obliged to share just critical comments or those that proffer a correction. In the critical comments department, I had the novel experience of hearing from a lawyer-paralegal in the law firm for one of the parties in the Mintel v. Neerghen case. Thankfully, Mr. Michael Castellaneta's excoriation doesn't go quite so far as to question whether my mother and father were lawfully wed at the time of my conception. But, save for the incongruous "Kindest Regards" at the close, he pulls no punches in his assessment of my post on U.S. Magistrate Judge Valdez' Memorandum Opinion and Order in Mintel v. Neerghen.  It's a comment to the related post below, along with my response.

Plaintiff fails to respond promptly, court orders privilege waived

Brookdale Univ. Hosp. & Med. Ctr., Inc., 2009 WL 393644 (E.D.N.Y. Feb. 13, 2009)

In this case, the court was asked to reconsider its prior order compelling defendants to return privileged documents inadvertently produced by the plaintiff.  The court declined to overturn its ruling regarding documents specifically identified by the plaintiff as inadvertently produced and addressed by the court’s prior order.  However, as to documents not identified at the time of the order, the court declared any privilege waived.  Read the entire post here.

Better to Fetter: Mintel v. Neerghen

There's a new decision out of the N.D. of Illinois addressing the question of what justifies direct access to a non-party's hard drives in the context of employee data theft.  IMHO, the Court reached the correct outcome when it denied such access, but it's a frustrating opinion because the tenacious movant appears to have become so fixated on obtaining drive images that it ignored simpler, less-invasive ways to answer what should have been the critical question, i.e., did the competitor get hold of and use stolen data?

I have some thoughts about how this should have come down.

The case is styled, Mintel Int’l Group, Ltd. v. Neerghen, 2009 WL 249227 (N.D. Ill. Feb. 3, 2009), and once again a tip of the hat goes out to the excellent Ediscoverylaw.com website for flagging and hosting the opinion.

Court finds privilege waived absent evidence of reasonable precautions

SEC v. Badian, 2009 WL 222783 (S.D.N.Y Jan. 26, 2009)

In this case, Rhino Investors, Inc. (“Rhino”), a non-party, sought to claw back approximately 260 documents that it claimed were inadvertently produced in 2003 in the midst of an SEC investigation.  The court, applying the four factors set forth in Louis Sportswear, U.S.A., Inc. v. Levi Strauss & Co., 104 F.R.D. 103, 105 (S.D.N.Y. 1985) and its progeny, concluded that Rhino had waived any privilege it may have asserted.  Read the complete story here.

Do you have a Gladys Kravitz type in your company?

Gladys Kravitz was the neighbor in the 60s TV show Bewitched who was always spying on Samanta. She is the archetypal snoopy neighbor, one on a witch-hunt at that. When you have people like that in your company, especially in your IT department, watch out. They could be reading your email and saving copies of any juicy stuff they find to use against you later. They may even save it to turn over to the prosecutors someday to save themselves. This can happen to you, even if you own the company, or perhaps I should say, especially if you own the company or are a top officer. Just ask Henry Nicholas, the co-founder and ex-CEO of Broadcom, who had his email read by an IT guy. Now that email is prosecution Exhibit "A", just waiting for him to testify at trial. This is all described in U.S. v. Nicholas, __F.Supp.2d__, 2008 WL 5546721 (C.D.Cal., Dec. 29, 2008), and the latest e-Discovery Team blog, IT Workers Read Your Personal Email and U.S. Law is Generally OK with That.

Court: e-mail may be admitted for other purposes; denies M to supress

U.S. v. Nicholas, 2008 WL 5546721 (C.D. Cal. Dec. 29, 2008)

In this case, the United States District Court in the Central District of California denied defendant Henry Nicholas’s motion to block the production of an incriminating email and for an order preventing the use of the email for cross examination or impeachment should Nicholas testify.  Rejecting Nicholas’s argument that the email was protected from disclosure by marital privilege, the district court held that a Ninth Circuit ruling that the email was subject to some protection by the marital privilege did not preclude all potential use of the email.  Accordingly the district court held that because the email could constitute the admission of a co-conspirator and be admissible at trial under other limited circumstances, it must be disclosed to Nicholas’s co-defendant.  Read the rest here.

Court: Fed Agency Must Spend $ to Comply

Appeals Court Requires Federal Agency to Spend 9% of Its Total Annual Budget to Comply with 3rd Party Subpoena of Electronic Records:

The United States Court of Appeals for the District of Columbia on January 6, 2009 issued an opinion affirming a contempt order against the Office of Federal Housing Enterprise Oversight (“OFHEO”). In re: Fannie Mae Securities Litigation 2009 U.S. App. LEXIS 9 (D.C. App. Jan. 6, 2009). The net result of the opinion is to affirm orders that required OFHEO to incur over $6 Million in expenses to respond to individual defendant discovery requests. The appeals court noted that this was more than 9% of the agency's entire annual budget, but did not seem too troubled by that. OFHEO was not even a party to the suit where they were required to bear this enormous burden. No wonder the government is going broke, just like many of the homeowners that Fannie Mae and OFHEO were supposed to protect. 

How could such a thing happen you may well wonder? It is the usual answer. If you are a regular reader of the e-Discovery Team blog, you know what it is already. 

Rule 34 & Form of Production

Over the next several weeks Arkfeld's E-Discovery Alert will focus on the strategy and tactics for handling sixteen specific ESI issues throughout pretrial discovery. Whether it is a "meet and confer" or request for production these are the critical issues to focus in requesting or producing ESI. The legal issue excerpts will be derived from the Best Practices Guide for ESI Pretrial Discovery - Strategy and Tactics (2008-2009). The Guide is cross-referenced and hyperlinked with the Arkfeld on Electronic Discovery and Evidence (2nd ed.) treatise and part of the CD-ROM.

________________________________________
 
ISSUE:  DOES RULE 34 SET FORTH MANDATES REGARDING THE “FORM OR FORMS” OF “ELECTRONICALLY STORED INFORMATION” FOR DISCLOSURE PURPOSES?

ANSWER:  YES


Best Practices Guide for ESI Pretrial Discovery - Strategy and Tactics (2008-2009)


§ 3.10   RULE 34 AND FORM OF PRODUCTION

A.   Overview 
B.   Kept in the Usual Course of Business or Labeled 
C.   Translated Into Reasonably Usable Form or Ordinarily Maintained 
D.   Procedure Determining Form(s) of ESI 
E.   Requesting Party Strategy 
F.   Producing Party Strategy 
G.   Checklist  


A. Overview

During the early stages of electronic discovery, critical decisions have to be made as to the ESI form(s) that will be disclosed to, or received by a party. These decisions will impact, from that point forward, every aspect of the electronic discovery production and disclosure process. For example, they will determine whether the data is searchable and whether metadata is disclosed. They will also impact the cost of managing your litigation information. Failure to request or to disclose the proper ESI form(s) can have severe consequences. Read more . . .

Producer Sanctioned

Unfiltered Orange just tweeted about this post on Electronic Discovery Blog re: a producer sanctioned for failure to provide a 30(b)(6) witness where it failed to educate itself on its systems.

Another Excellent Effort by Judge Paul Grimm

Federal Magistrate Judge Paul Grimm of Maryland penned another magnum opinion delivering a pointed, scholarly and thoughtful exploration of the biggest abuses plaguing discovery.  Mancia v. Mayflower Textile Services Co, No. 1:08-CV-00273-CCB (D. Maryland 10/15/2008) isn't as daunting as Grimm's opus in Lorraine v. Markel or as eye-opening as his Victor Stanley v. Creative Pipe, but it has the distinction of being the first reported case to laud The Sedona Conference Cooperation Proclamation, a manifesto that's more than just a pipe dream because it comes coupled with a genuine commitment to develop the tools to make it work.  More, Mancia forecefully articulates the impetus for courts to use sanctions to both punish and deter boilerplate requests and objection--a specie of lax lawyering that's long overdue for extinction.

I don't know who squealed, but Judge Grimm knows that by rationalizing the use of boilerplate as "zealous advocacy," it's been a guilt-free cha-cha-cha to let the "zeal" thing crowd out the "officer of the court" thing.  He reminds us that lawyers owe a duty to something more important and noble than victory, and that when we serve a request or make an objection, we are giving our word that we looked before we leapt. 

Just more high-minded tosh that poses no threat to business as usual?  Don't bet on it.  You can pull the mask off that ol' Lone Ranger, but you don't mess around with Grimm. 

Be sure to read Mancia before you reflexively trot out "any," "all," "overly broad" or "unduly burdensome" in your next discovery request or response.  Take a moment to scrutinize the requests and objections at issue in Mancia, then ask yourself, "Is my work really that much different?"

USB GC Pays $6.5M to Settle Insider Trading

From our colleagues at The American Lawyer's Litigation Daily

 

Edited by Andrew Longstreth:

Beware the E-Mail Trail: Former UBS General Counsel Pays $6.5 Million to
Settle Insider Trading Allegations

It wasn't just the market that took another blow to the gut yesterday. So
did the reputation of David Aufhauser, the former UBS general counsel for
the Americas, who agreed to pay $6.5 million to end an insider-trading
investigation of his sale of personal holdings in the auction-rate
securities market.  

Ex-McAfee GC's Fate in Jury's Hands

Our colleagues at The Recorder have this story about Kent Roberts' trial, which went to the jury Tuesday after the defense rested w/o calling witnesses. Cooley's Stephen Neal "simply read aloud a stipulation to inform the jury about McAfee's late production of relevant e-mails at the beginning of the trial," notes Law.com.

Photo of Neal by Jason Doiy

McAfee BackDating

Our colleagues at The Recorder in San Francisco have just broken a story about a "discovery disaster that threatens to derail the government's stock options prosecution against McAfee's former GC."

Check it out here: or for updates, at www.callaw.com

Acumen Outsourcing Case (India)

Here's the story from The American Lawyer Daily:

Does Legal Outsourcing Put Private Info at Risk?

Posted by Zach Lowe

Late last month the American Bar Association gave the green light to legal outsourcing, provided that firms sending work overseas make sure that everything done beyond U.S. borders is done by the book--including the protection of confidential information.

Even before the ABA move, one Maryland firm was worried enough about the privacy issue to file a lawsuit against Acumen Legal Services, a legal-process outsourcing company based in India. The basis of the May complaint, filed by Joseph Hennessy, a name partner at the Maryland boutique Newman, McIntosh & Hennessey: Given that the federal government now monitors some communications between citizens here and foreign nationals, LPOs can't guarantee that a client's personal information is safe from  such surveillance.

Discovery Approved for Computer in Divorce Proceedings

A computer recovered by a woman from the trunk of a family car is subject to discovery in a matrimonial proceeding, a New York judge has ruled. The woman's husband opposed allowing her to use information gleaned from the laptop, arguing she had improperly "seized" his personal, work-issued computer. But New York Supreme Court Justice Saralee Evans found that the wife's actions did not constitute computer trespass or using a computer without authorization, as the files were on a readily accessible computer.

The sun was in my eyes. How about a do-over?

The e-discovery bar (i.e. all of us carefree minstrels who venture from town-to-town performing the morality play, "Facciamo Tenere Mani e Parlare di Sistemi" or "Let's Hold Hands and Speak of Systems") has suffered a setback in the form of an opinion that doesn't jibe with the transparent EDD model that serves as our bar's Kumbaya. 

Who among us isn't preaching that there should be disclosure of information pertaining to the storage, preservation and backup of e-mails?  I consider it de rigeur to identify one's e-mail system to the other side and share information about purge practices and backup.  So, imagine my chagrin when the judge in Cunningham v. Standard Fire Ins. Co., 2008 WL 2668301 (D. Colo. July 1, 2008), an insurance bad faith claim, barred inquiry into "the storage, preservation and backup of emails relating to...Plaintiff's claims."

Arkfeld's eLawExchange.com

We are excited to launch our new web site Arkfeld's eLawExchange.com (www.elawexchange.com) and its many free resources for the eLaw legal community.

The web site provides FREE access to:

•    State Ediscovery Caselaw and Rules - This database contains ediscovery caselaw and procedural rules from all 50 states. Check back often to see the status of ediscovery law in your state.

Another Ethics Ruling on Metadata

Bob Ambrogi reports on our LegalBlogWatch: 

Is it ethical to search for metadata in a document you receive from opposing counsel? As we've reported here in the past, the American Bar Association says yes but the New York County Lawyers' Association says no. Maryland and the District of Columbia have also sided with the ABA on the issue, while Arizona, Alabama and Florida agree with New York.

Grimm Prognosis for ESI Search

There’s a double standard in e-discovery. Keyword search is deemed "good enough" for identifying responsive ESI; yet when privilege is on the line, lawyers insist on page-by-page review. It’s a tacit recognition that keyword search is a blunt instrument--a point artfully made earlier this year by Magistrate Judge John Facciola in U.S v. O’Keefe and Equity Analytics v. Lundin and emphatically underscored lately by Magistrate Judge Paul Grimm in Victor Stanley, Inc. v. Creative Pipe, Inc.

It’s assumed that lawyers are qualified to review documents and decide their relevance, responsiveness and privileged character. But are we qualified to craft proxies for our judgment in the form of keyword searches?

Beware Crossing Borders w/ Laptops

From Bizunesh Scott, of Patton Boggs:

Beware when crossing borders with your laptop! The Ninth Circuit seems to be creating tools for the federal government to use U.S. borders to gather evidence from your laptop and data storage devices.  The Ninth Circuit recently held that a customs officer can examine the electronic contents of a passenger's laptop computer without reasonable suspicion.  United States v. Arnold, 2008 WL 1776525 (9th Cir. April 21, 2008).

More about Victor Stanley v. Creative Pipe

Alysia Solow of Constantine Cannon forwards this Memo & Order in Victor Stanley v. Creative Pipe, Download VictorStanley052908.pdf , with a summary of key points, written by Ilana Goldfarb of Constantine & Aborn Advisory Services.

(See also, Craig Ball's prior post here).

In Victor Stanley, Inc. (“Plaintiff”) vs. Creative Pipe, Inc., et al (collectively “Defendants”), Magistrate Judge Paul W. Grimm of the United States District Court for the District of Maryland found that the Defendants waived any privilege or work-product protection for the 165 electronically stored documents at issue in this case by disclosing them to the Plaintiff.

Todd v. Guidance Software

The American Lawyer's senior reporter Drew Combs forwards this proposed order for termination sanctions in the Todd v. Guidance Software dispute. Download Guidance.pdf.

Says Combs: "Where it now stands is that Guidance is being given an opportunity by the arbitrator to remedy the discovery infractions. If the arbitrator concludes at a June 20th status conference that Guidance has appropriately remedied the infractions then the sanctions stand and the case will move to an arbitration on the merit. If Guidance has not remedied the infractions then the case will proceed to the damages stage in favor of the plaintiff. "

We'll keep you posted on developments.

NYLJ: Husband denied access to wife's computers

The New York Law Journal reports on this decision from Kings County where a husband was denied access to his wife's computers in a divorce litigation.

Fed. law allows plaintiff to amend complaint to assert spoliation clause

Ed Schmidt Pontiac-GMC Truck, Inc. v. DaimlerChrysler Motors Co., LLC, 2008 WL 668267 (N.D. Ohio Mar. 11, 2008)

In this case, an automobile dealer brought suit alleging that DaimlerChrysler had breached a settlement agreement when it refused to grant the dealer a Chrysler franchise.  During the two years of discovery that followed, Schmidt alleged that DaimlerChrysler knowingly and intentionally destroyed relevant evidence.  Specifically, Schmidt alleged that DaimlerChrysler failed to implement a litigation hold to prevent the destruction of evidence after the complaint was filed in October 2004, and replaced or altered certain employees' hard drives days before Schmidt made forensic images of the drives as part of its discovery process.  Further, Schmidt alleged that DaimlerChrysler attempted to hide the extent and significance of its misconduct.  As a result, Schmidt sought to add a spoliation of evidence claim to the litigation.

Read the entire post at ediscoverylaw.com.

Dodging an EDD Sanction

While the courts are becoming more familiar with the legal and technical issues arising from electronic discovery, there is still no shortage of perplexing "e-issues" confronting judges. In <i>Toussie v. County of Suffolk</i> in the Eastern District of New York, a defendant dodged substantive sanctions for losing and/or destroying  e-mails requested in discovery because the parties requesting the e-mails failed to marshal satisfactory evidence that the missing e-mails would have been supportive of their case.

District court modifies magistrate judge's order to allow for pre-production privilege review

Bro-Tech Corp. v. Thermax, Inc., 2008 WL 724627 (E.D. Pa. Mar. 17, 2008)

In this case involving claims of misappropriation of trade secrets, defendants objected to an order of a magistrate judge requiring them to disclose "forensically sound" images of certain data storage devices (Thermax's India and Michigan servers) to plaintiffs' counsel without any limitation as to the scope of the disclosure or prior filtering for privileged or work-product materials that the images might hold.  The production was required to permit a determination of whether defendants had violated an earlier stipulation and order that had imposed an ongoing obligation on defendants to return to plaintiffs any of plaintiffs’ files in their possession, and then to purge such files from their possession, custody and/or control.

Read the rest of the post on ediscoverylaw.com.

Qualcomm's Hard-Learned Lessons

Here is Alan Cohen's article, from Corporate Counsel magazine, "Qualcomm's Hard-Learned Lessons"

Qualcomm Ruling: Recorder Stories

The Recorder provides this report by Zushe Elinson on yesterday's Qualcomm/Broadcom ruling. (See post below for the ruling download.)

Here's the intro:

Lawyers sanctioned for their roles in the Qualcomm discovery debacle have maintained that they would be exonerated if allowed to break attorney-client privilege and tell their side of the story.

Now they'll get their chance.

In a Wednesday order lifting the sanctions, U.S. District Judge Rudi Brewster wrote that six lawyers from Day Casebeer Madrid & Batchelder and Heller Ehrman should be allowed to defend their conduct in the failure to turn over key e-mails in a patent fight between Qualcomm Inc. and Broadcom Corp. Brewster reasoned that the self-defense exception to attorney-client privilege should apply because Qualcomm tried to clear itself while criticizing the attorneys in court declarations.

Brewster vacated and remanded sanctions ordered by U.S. Magistrate Judge Barbara Major on Jan. 7 against Day Casebeer's James Batchelder, Adam Bier, Kevin Leung, Christian Mammen and Lee Patch, and Heller's Stanley Young. The attorneys had filed objections to Major's order, which referred them to the State Bar of California for discipline.

Update: Here's a second story by Elinson filed today.

 

Qualcomm/Broadcom Sanctions Ruling

Of interest to those following the Q/B case, a March 5 ruling from Judge Rudi Brewster re: sanctions:

Download show_case_doc1.pdf

New York Weighs In on ESI

New York appellate and trial courts have recently issued a series of significant decisions concerning electronically stored information that serve as both a primer and a warning as to how best to deal with the transmission and use of such information in a litigation.

Court declines to order production of metadata, orders evidentiary hearing on spoliation charges

D'Onofrio v. SFX Sports Group, Inc., 2008 WL 189842 (D.D.C. Jan. 23, 2008)

In this contentious employment discrimination case, Magistrate Judge John M. Facciola resolved a number of discovery disputes relating to the production of electronically stored information.

Among other relief, plaintiff sought the production of a certain business plan in its original electronic format, with accompanying metadata.  Plaintiff argued that Fed. R. Civ. P. 34 permits the production of documents outside of their original format only "if necessary," and that in this case, there was no such necessity.  Defendants responded that:  (a) plaintiff did not request that the Business Plan or any other documents be produced in a specific format; (b) production in original electronic format with metadata is not required by the Federal Rules of Civil Procedure or in the absence of a clear agreement or court order, neither of which were present here; and (c) plaintiff had not demonstrated the relevance of the metadata.

Read entire post here.

Discovery in the Adam Walsh Child Protection and Safety Act ...

has been upheld by an Eastern District of N.Y. magistrate judge. U.S. Magistrate Judge Joan Azrack in U.S. v. Spivack, 05-CR-98, found the discovery provision in the 2006 law, requiring defense experts in a federal child pornography prosecution to perform computer forensic analyses at a government facility, constitutional. Daniel Wise reported this in the New York Law Journal.

The United States of E-Discovery

Not everyone litigates in federal court, which means not everyone gets whipped into a frenzy over the e-discovery amendments to the Federal Rules of Civil Procedure (FRCP).

If you thought you were safe from e-discovery demands just because you stayed stateside in your litigious endeavors, you might want to check in with your state's rules committee. There's a good probability that your state is considering adopting rules similar to the amended FRCP, if they haven't already voted them into play.