As we’ve discussed multiple times (see here, here, and here), the issue of what types of ediscovery costs are taxable under 28 U.S.C. § 1920 was first addressed by a federal appellate court last spring in Race Tires America, Inc. v. Hoosier Racing Tire Corp. The Third Circuit – in line with the Supreme Court’s interpretation of Section 1920 – declined to broadly apply the statute, concluding that only the costs of scanning paper documents and converting native files into TIFF images are recoverable. The Third Circuit’s analysis has gained traction with numerous district courts, but last week, gained its first appellate follower. Continue Reading
Ok, excuse that bad joke. But the recent decision in In re: Biomet, the hip replacement multi-district litigation out of the Northern District of Indiana, is noteworthy because it discusses proportionality and predictive coding in the same space.
The mere fact that predictive coding is an available tool doesn’t mean that it should be applied to every document in a client’s possession, custody or control. Rather, it can be ok – defensible, even – to use it only on a subset of what is identified as potentially relevant. The open question is how and when to create the universe of documents subject to machine learning.
In Biomet, the defendant identified nearly 20 million documents for possible review, and then reduced that universe by using keyword searches. After deduping, that left 2.5 million documents and attachments. Continue Reading
After attending LegalTech New York last week, Gil Keteltas, e-Discovery litigator and editor of BakerHostetler’s Discovery Advocate blog, had the opportunity to speak with Colin O’Keefe of LXBN to share his perspective. In the brief interview, he offers his overall impressions of the conference, shares his thoughts on a few noteworthy speakers and also follows up on some of the questions he posed in a blog post prior to the event.
A recent decision out of the Northern District of Illinois serves as an important reminder to all counsel relying on e-discovery vendors. In Peerless Industries, Inc. v. Crimson AV, LLC, the defendant was found to have control over its China-based supplier and, in particular, over the supplier’s documents.
After the defendant’s 30(b)(6) witness was unable to describe the Chinese entities’ computer and back-up systems, what searches were performed, or the Chinese entity’s document retention policy, the plaintiff sought sanctions.
Magistrate Judge Cox’s decision covers a lot of territory, including where the corporate representative could be deposed. But the most interesting part of this concise ruling concerns sanctions and her straightforward conclusion that a corporate representative can’t dodge questions concerning the preservation and collection of corporate records by saying pointing to the discovery vendor. Judge Cox held:
Such a hands-off approach is insufficient. Because of the control or “close coordination” between the two companies, defendants were required to produce the requested information. Defendants cannot place the burden of compliance on an outside vendor and have no knowledge, or claim no control, over the process.
As litigants become increasingly dependent on vendors to assist with the discovery process, they must still understand, direct and approvethe vendors’ activities.
Courts will have limited patience for attorney claims that they simply don’t understand technology. The recently revised comments to ABA Model Rule 1.1 state, “[t]o maintain the requisite knowledge and skill, a lawyer should keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology.”
In fact, this is not the first time a court has rejected attempts to blame vendors for issues arising in a document production. See Thorncreek Apartments III, LLC v. Village of Park Forest, 2011 3489828 (N.D. Ill. Aug. 9, 2011) (party waived privilege claim where it blindly relied on vendor to withhold documents tagged “privileged”); Rosenthal Collins Group, LLC v. Trading Techs. Int’l, Inc., 2011 WL 722467 (N.D. Ill. Feb. 23, 2011) (sanctioning a party for its vendor’s misconduct).
Bottom line - Peerless reminds attorneys, both in house and outside, of the importance of working closely with your vendor. Because at the end of the day, if your client’s discovery obligations have not been satisfied, we suspect that judges will carefully evaluate the involvement of counsel before shifting the blame to vendors.
Co-authored by: Karin Jenson
Those of a certain age may recall the television show The Electric Company’s leading superhero, Letterman. He could resolve nearly any crisis by deleting, adding, or changing a letter, all while grooving to funky 70s’ music. Maybe that’s how we ended up with “eDiscovery.” Troubled by the legal profession’s lack of attention to electronically stored information, Letterman took the “e” from his chest and, well, you know the rest.
Initially, Letterman’s action had a positive effect. Lawyers began to focus on ESI. The Federal Rules Committee made clear that discovery included the “e.”
But, like most superhero interventions, there were some unintended consequences.
LegalTech New York is right around the corner. And, much like the recent Georgetown Advanced Ediscovery Institute, there will be no shortage of discussion about predictive coding/technology-assisted review (“TAR”). The agenda includes fourteen program descriptions that directly reference TAR and another eight that clearly suggest TAR will be a major topic.
As a user, student and proponent of TAR in the right cases, I hope we can sharpen the discussion at LegalTech TAR 2013. Along those lines, permit me a few (hopefully) constructive suggestions: Continue Reading
Editor’s Note: This post is a joint submission to BakerHostetler’s Data Privacy Monitor blog.
Communications between spouses are typically accorded a “marital communications privilege” because they are “regarded as so essential to the preservation of the marriage relationship as to outweigh the disadvantages to the administration of justice which the privilege entails.” But marital communications to or from a workplace computer just became less privileged – at least in the Fourth Circuit.
In United States v. Hamilton, the Fourth Circuit considered Phillip Hamilton’s challenge to his conviction for bribery and extortion under color of official right. A jury concluded that, “while a state legislator, Hamilton secured state funding for a public university in exchange for employment by the university.”
Email that Hamilton sent to his wife from his part-time consulting job at the Newport News public school system was key evidence in his conviction. On appeal, Hamiltonargued that his email exchanges with his wife were subject to the marital communication privilege and were improperly admitted into evidence. Why did a three-judge panel of the Fourth Circuit disagree? Continue Reading
The Internal Revenue Service’s Director of Collection Policy recently released Memorandum SBSE-05-0912-075, revising prior guidance to IRS collection employees on their obligations to preserve electronic and paper documents related to disputes with taxpayers. This Memorandum generally follows existing law, but represents a welcome departure from recent guidance issued by the IRS Office of Chief Counsel in Notice (CC-2012-017), which we discussed in a prior post. As we discuss in more detail after the jump, the Memorandum:
- Generally assigns responsibility for the document preservation process to IRS Collection Advisors and agency counsel;
- Expansively describes “potentially relevant information” subject to preservation, specifically listing extensive categories of electronically stored information and paper documents that IRS employees must preserve; and .
- Signals that the agency views preservation of potentially relevant information as a higher priority than in prior guidance.
BakerHostetler announced today that Gil Keteltas and Karin Scholz Jenson have been appointed National Co-Chairs of its E-Discovery Advocacy and Management Team. The name of the practice team has also been changed to reflect the importance of strong advocacy, in addition to managed litigation support, in controlling the costs, risks and burdens of electronic discovery.
Gil will also be presenting this week at the Symantec Transparent Predictive Coding and eDiscovery Lab and Georgetown’s Advanced E-Discovery Institute .
It is boilerplate law that parties are under an obligation to preserve potentially relevant evidence when they identify a “reasonable anticipation of litigation.” Application of that simple rule in the real world is more complicated, however, because the path to litigation is often incremental. Particularly in commercial contexts, there are often many steps and many months that intervene between the time that parties first recognize a potential dispute and the dispute matures to a point where litigation is anticipated. As a result, courts are frequently presented with preservation and spoliations questions focused on the facts-specific question of when litigation is reasonably anticipated (and a duty to preserve is, therefore, triggered).
Determining when litigation is “reasonably anticipated” is particularly difficult in the context of tax controversies. Continue Reading