The Importance of Witness Interviews: ‘What Happens in Vegas Shouldn’t Stay in Vegas’

September 16, 2018

A discovery order in Vegas shows the importance of witness interviews and what can happen when you take a cavalier attitude towards preservation. Small v. University Medical CenterCase No. 2:13-cv-0298-APG-PAL (D.C. Nev., 9/9/18) (FLSA class action seeking unpaid wages for skipped meal breaks). The lengthy order is entitled Report and Recommendation and Final Findings of Fact and Conclusions of Law and imposes severe sanctions on the defendant. The order proves, when it comes to e-discovery at least, what happens in Vegas doesn’t stay in Vegas. The truth does and should come out, including where’s the electronic evidence. Interviews are a good way to find out what really happened.

This is a long blog – 5,122 words – but it is still a lot shorter than the 123 page Short opinion, which is not short at all. I counted, it is 48,980 words. Not that I’m complaining, but it is one of the longest discovery orders I have ever read. It has many good instructional elements. Specialists should probably read and skim the whole opinion.

The Short opinion also has the distinction of having taken longer to prepare than any other discovery order I have ever read – FOUR YEARS! Can you imagine any decision taking that long? I am sure there were good reasons, but still. That is a full presidential term.

First Steps of e-Discovery: Prepare and Preserve

The FLSA suit arose from a DOL investigation that faulted the defendant employer hospital, UMC, for failing to keep “accurate records” of the time worked. UMC’s alleged records failures continued after it was sued. They failed to give timely preservation notices and failed to interview key custodians. That’s a failure of the first two legal tasks a lawyer is required to do in Electronic Discovery Best Practices (EDBP), steps two and three (step one is prepare). See EDBP.com (detail shown above right with all ten legal activities shown below); also see: Favro, Phillip, Vegas Court Spotlights the Importance of Custodian Interviews with New ESI Sources (LegalTech News 8/30/18) (further discussed below); John Patzakis, Three Key eDiscovery Preservation Lessons from Small v. University Medical Center (Next Generation eDiscovery Blog, 9/12/18).

Judge Peggy Leen’s Order

Magistrate Judge Peggy A. Leen is the learned judge who wrote the opinion in Small v. University Medical Center, Report and Recommendation and Final Findings of Fact and Conclusions of Law. The order affirms and implements most of the recommendations of the Special Master for e-Discovery appointed several years ago in this case, Daniel Garrie.

The Special Master’s Report was issued four years earlier on August 18, 2014, two years after the suit was filed in July 2012. The Report was notable for characterization of defendant’s discovery misconduct as so egregious as to “shock the conscience” and make “a mockery of the orderly administration of justice.” It was a long, complicated report.

When she completed her work she ruled in large part for the plaintiffs and  sanctioned the defendant:

VI. THE COURT’S FINDINGS AND CONCLUSIONS

The court has personally conducted a thorough review of the record prior to the special master’s appointment and the record of the proceedings conducted by the special master. The record before the court and the record developed by the special master amply supports his findings that UMC destroyed evidence by failing to identify, preserve, collect, process, and search multiple repositories of information relevant to the parties’ claims and defenses.

UMC failed to preserve several different types of ESI, including an estimated 26,000 text messages and 38,000 documents from a shared drive “containing human resources, corporate compliance, employee grievance, payroll, and DOL investigation data.” The documents lost include important policy and procedure manuals regarding meal breaks and compensation. Relevant ESI on laptops, desktops and local drives were not preserved until some 18 months into the litigation. UMC also failed to comply with multiple discovery orders, leading to the plaintiffs’ motions for sanctions.

Judge Leen did not follow the recommendation of the Special Master to impose a sanction of default judgment in favor of 613 class members on the Fair Labor Standards Act claims. Instead, she imposed a permissive adverse inference jury instruction, along with monetary sanctions. These jury instructions can have a profound impact on the jury, but not as  strong as a mandatory adverse inference instruction. The mandatory instruction almost always leads to a verdict against the spoliating party. The permissive kind of instruction imposed here still gives a defendant like UMC a chance. The sanctioned party can still prevail with a jury on the merits of the case, albeit a slim chance. Here is the specific language that Judge Leen suggested be used at trial with the jury:

2. UMC is sanctioned in the form of an instruction to the jury that the court has found UMC failed to comply with its legal duty to preserve discoverable information, failed to comply with its discovery obligations, and failed to comply with a number of the court’s orders. The instruction will provide that these failures resulted in the loss or destruction of some ESI relevant to the parties’ claims and defenses and responsive to plaintiffs’ discovery requests, and that the jury may consider these findings with all other evidence in the case for whatever value it deems appropriate.

Careful study of the long opinion shows a very practical, albeit unstated reason for Judge Leen to make this concession. It made her order much harder to appeal; some would say appeal-proof. (After you put four years into something you want it to last.) That is because near the end of the process at one of the hearings Judge Leen was able to get defendant’s own attorney to concede that an adverse inference jury instruction would be appropriate. You do not see that happen very often. But this attorney apparently saw the writing on the wall from the comments the judge was making and realized that accepting a permissive inference was the best they could hope for and certainly a lot better than default judgments for all 613 class members.

Here is Judge Leen’s explanation of how this admission came about.

During oral argument on its objections to the special master’s R & R, counsel for UMC stated “I’m not even going to tell you that I don’t think we shouldn’t be sanctioned.” (Hr’g Tr. 24:28-25:1, Oct. 21, 2014, ECF No. 229.) When asked what sanction he felt was appropriate based on the developed record, UMC’s counsel suggested that an adverse inference jury instruction would be appropriate. (Tr. 25:4-10.)

Here we see a wise and experienced judge in action. Too bad Peggy Leen retires in 2019.

Judge Leen had good reason under the law to hesitate to enter default judgments on 613 claims, effectively ending the cases except to determine the amount of damages, all without any hearing on the merits of the claims. Entry of the  lesser sanction of a permissive instruction was consistent with Judge Leen’s analysis of Rule 37(b) on sanctions for violation of court orders.

[T]he court cannot conclude that UMC’s multiple discovery failures and failure to comply with the court’s orders threatens to interfere with the rightful decision of this case on the merits.

The lesser sanction was also consistent with her analysis of 2015 revisions to Rule 37(e) on sanctions for ESI spoliation, Rule 1 on just-speedy-inexpensive, and Rule 26(b)(1) on proportionality. Here is Judge Leen’s well-accepted analysis of 37(e):

To summarize, the court may impose sanctions against UMC under the current version of Rule 37(e) only if it finds: (1) UMC failed to preserve ESI “that should have been preserved” in anticipation or conduct of litigation; (2) the information was lost because UMC failed to take reasonable steps to preserve it; (3) the ESI cannot be restored or replaced; and (4) the plaintiffs were prejudiced by the loss. If all of these prerequisites are met, the court may issue sanctions no greater than necessary to cure the prejudice caused by the loss. Only if the court finds UMC acted with intent to deprive may the court impose the most severe sanctions.

Judge Leen then applied the law to the facts.

The court has found that UMC failed to preserve ESI that should have been preserved in anticipation of litigation, and throughout the course of this litigation. The court has also found that the information was lost because UMC failed to take reasonable steps to preserve it. Thousands of text messages on UMC Blackberry devices were lost and cannot be restored. Tens of thousands of files from the Q-Drive were lost and cannot be restored prior to December 2013. . . .

However, the special master’s extraordinary expertise and persistence resulted in restoration, remediation, and production of a great deal of relevant and discoverable ESI. The special master was able to direct restoration of the time tracking systems UMC failed to disclose until near the end of special master proceedings. Fortunately, Jackie Panzeri, UMC’s payroll manager who described herself as a “pack rat” that “keeps documents forever” had a lot of documents on her personal drive and several archives full of emails she did not delete or modify. She was involved in the DOL investigation from the beginning and saved both documents collected and produced to the DOL and for this case. The court is also mindful that ESI is stored in multiple locations and that modified or lost data from the seven key custodians is likely to be found in other locations. . . .

Although the court finds plaintiffs have been prejudiced by the loss of data from key repositories and custodians, the loss has not threatened to interfere with the rightful decision of the case on its merits given the large volume of ESI the special master was able to ensure that UMC produced. For these reasons, the court finds that lesser sanctions are appropriate, proportional, and no greater than necessary to cure the prejudice caused by the loss of ESI uncovered by the special master.

As you can see, hope springs eternal. Judge Leen’s still thinks that the now lost ESI from the seven key custodians is likely to be found in other locations. 

I doubt the Special Master Garrie would share the same optimism. He has already called defendant’s conduct a mockery of the orderly administration of justice. In his Report the Special Master said he has “serious doubts that UMC can complete discovery in a defensible manner going forward without increased candor to the Court and their own counsel, and more competent technical assistance.’ Well, maybe they will change. If not, and Judge Leen is wrong and the missing ESI is not found, then Judge Lee or her successor might reconsider and upgrade the sanction to a mandatory adverse inference. Special Master Garrie may yet get his way.

Defendant’s Threshold Errors

The quotes below from Small summarize the key factual findings of defendants’ threshold errors, the ones that lead to most of the others (emphasis added), much like a domino effect. To me these are the most important errors made and you should study Judge Leen’s words here closely.

D. UMC Executives Failed to Accept Responsibility for Ensuring that ESI was Preserved and Failed to Notify Key Custodians and IT Staff to Preserve, and Prevent Loss, or Destruction of Relevant, Responsive ESI

The record amply supports the special master’s findings that UMC had no policy for issuing a litigation hold, and that no such hold was issued for the first eight months of this litigation until after Mr. Espinoza was deposed on April 8, 2013, and was asked about UMC’s response to plaintiff’s August 6, 2012 preservation letter. The special master accurately found that UMC executives were unaware of their preservation duties, ignored them altogether, or at best addressed them “in the hallway in passing.” . . .

The special master’s finding that UMC executives failed to accept responsibility for their legal duty to preserve is amply supported in the record. UMC executives and counsel failed to communicate with and provide adequate instructions to the department heads and IT personnel of repositories containing discoverable ESI to prevent the loss or destruction of potentially relevant ESI. . . .

There is no evidence in the record, and UMC does not suggest there is any, that current or former counsel gave instructions to UMC to suspend business as usual to prevent the destruction, deletion or modification of ESI responsive to plaintiffs’ discovery requests. . . .

It is also undisputed that UMC’s prior and current counsel failed to conduct timely custodian interviews. Custodian interviews were not conducted until well into the special master proceedings when it became apparent they had not been done. The special master required the interviews to be conducted a second time because the initial custodian interviews conducted by counsel were inadequate. . . .

There is ample support in the record that UMC executives displayed a cavalier attitude about their preservation obligations addressing them in passing, and that UMC executives repeatedly took the position in declarations and testimony that responsibility for preservation was someone else’s job. . . .

The special master correctly found that current and former counsel failed to conduct timely custodian interviews to identify individuals with discoverable information and key repositories of discoverable ESI.

The record in this matter is very complex and voluminous. That is why the Special Master Report and the Order by Judge Leen are so lengthy; 123 pages for the order alone. Suffice it to say, if witness interviews of key custodians been conducted when they should have, shortly after suit was filed, a great deal of relevant evidence that ultimately was lost could have been saved. The Special Master’s detailed findings make that obvious. The lost-files could have been identified and preserved unaltered. Lines of responsibility to comply with legal preservation obligations could have been clarified and enforced. Had these interviews been conducted, and the ESI found quickly, the relevant ESI could have been bulk-collected and the evidence saved from spoliation.

As it is, the actions and mistakes of defendant here have severely weakened their case. That’s what can easily happen when a company has a cavalier attitude to compliance with their legal obligation to preserve potentially relevant ESI.

Eight Failed Challenges to the Special Master’s Report

Judge Leen considered and rejected eight challenges to the Special Master’s report that were raised by the defendant employer, UMC:

  1. Competence and Impartiality of the Special Master, Daniel Garrie.
  2. UMC’s Failure to Comply with the Court’s Orders to Preserve and Produce ESI.
  3. UMC’s Failure Have a Preservation Policy or Litigation Hold Policy and Failure to Timely Implement One.
  4. UMC’s Executives Failure to Accept Responsibility for Ensuring that ESI was Preserved and Failure to Notify Key Custodians and IT Staff to Preserve, and Prevent Loss, or Destruction of Relevant, Responsive ESI.
  5. UMC’s Failure to Disclose the Existence of Relevant ESI Repositories, Including Multiple Timekeeping Systems and the Q-Drive Until Late in the Special Master Proceedings.
  6. UMC Modified, Lost, Deleted and/or Destroyed ESI Responsive to Plaintiffs’ Discovery Requests.
  7. UMC’s Failure to Comply with its Legal Duty to Preserve, Failure to Put in Place a Timely Litigation Hold, Failure to Comply with Multiple Court Orders to Preserve and Produce Responsive ESI, and Loss and Destruction of Responsive ESI (1) Necessitated the Appointment of a Special Master, (2) Caused Substantial Delay of these Proceedings, and (3) Caused Plaintiffs to Incur Needless Monetary Expenses.
  8. The Special Master Correctly Concluded UMC Repeatedly Misrepresented the Completeness of its Production of Documents Produced to DOL; However, UMC Was Not Ordered to Produce Kronos Payroll Data in Spreadsheet Format.

Defendants failed in their challenges to the Special Master’s findings, including the threshold challenge to Special Master Dan Garrie’s competence. Ouch! Garrie is a Senior Managing Partner of Law & Forensics. He has written numerous articles and books on law, technology and e-discovery. See eg. D. Garrie & Yoav Griver. Dispute Resolution and E-Discovery, Thomson Reuters (2nd ed. 2013). Garrie earned a Masters degree in computer science at Brandeis University before going on to law school. A challenge to his expertise was misplaced.

The challenge did not go over well with the supervising Judge who studied his work more closely than anyone. After emphatically rejecting the hospital arguments, Judge Peggy Leen stated:

The court has conducted a de novo review of all of the special master proceedings and finds that he was professional and courteous, if occasionally frustrated by testimony displaying a lack of appreciation of UMC’s legal duties to preserve and produce responsive ESI. He was repeatedly told by UMC executives and employees that they did not know about their duty to preserve, had not learned about their preservation obligations from counsel, did not know what a litigation hold was, and had not explored relevant repositories of information responsive to plaintiffs’ discovery requests.

Bench Slap of Defendant’s Attorneys

With a background like that it is not surprising that the Special Master uncovered so much evidence of incompetence and malfeasance in preserving evidence. Judge Leen held: (emphasis added)

UMC was on notice that its timekeeping, time systems, payroll policies, and procedures were relevant to this litigation. UMC also knew it was unable to document that employees were being compensated for actual time worked. Both UMC and its former and current counsel failed to comply with UMC’s legal duty to suspend routine document retention/destruction policies to ensure the preservation of relevant documents. UMC failed to communicate the need to preserve relevant documents and ESI to employees in possession or likely to be in possession of discoverable information, or for that matter to communicate this duty even to “key players.” UMC and its counsel failed to identify, locate, and maintain information relevant to specific, predictable, and identifiable claims involved in this litigation.

Note that Judge Leen goes out of her way to include the defendant and its lawyers in the blame, both its  prior attorneys and its present attorneys. All of these attorneys failed in the “legal duty to suspend routine document retention/destruction policies to ensure the preservation of relevant documents.” In situations of shared blame like this the attorneys involved are sometimes personally sanctioned along with the client, but this has not happen here. Judge Leen did make several sharp comments against the defendants lawyers, includi9ng this finding:

UMC’s current counsel blamed former counsel and their ESI consultants for the delay in producing responsive ESI. Counsel for UMC advised the court at the hearing on June 25, 2013, that the client did not have any real understanding of what MPP had done or what data had been collected. This representation turned out to be false. . . . Thus, the representation UMC’s current counsel made to the court that the client did not have any real idea of what prior counsel had done regarding ESI collection was patently false. In the light most favorable to current counsel, they did not ask the right questions of the individuals involved in the initial collection. The people involved in the process— MPP, its vendors and consultants, and the IT personnel at UMC who did the collection of ESI from 26 custodians—were simply not asked until after the special master was appointed and made the appropriate inquiries.

You do not see comments like that very often. Basically the judge is saying you lied to me and I cannot trust you. Again, more conscience shocking conduct by these attorneys, well outside the norm of accepted behavior.

Importance and Art of Custodian Interviews

The interviews that eventually were taken under the Special Master’s order and supervision show that critical evidence could have been saved from routine destruction, if the interviews been done at the time the suit was filed, not years later. The interviews would have ensured that preservation notices were properly given, understood and followed, and the right ESI was collected and effectively searched. See William A. Gross Construction Associates, Inc. v. American Manufacturers Mutual Insurance Co., 256 F.R.D. 134, 136 (S.D.N.Y. 2009) (custodian interviews to assist also in keyword search formulation).

It is important to note that the custodian interviews in Small had to be done twice. The attorneys botched the first attempt at witness interviews. They were ordered to do it again. I am not surprised. Many people underestimate the complexity and sophistication of interviews in cases like this. They also underestimate the wiliness of custodians and tendency of some of them to evade questions.

It is very difficult for most attorneys to conduct an interview on the subject of information storage, IT systems, company document storage systems, email, texts, other personal messaging, social media, personal computers, phones, other devices and  software programs used. Questions on these subjects are very different from questions on the merits of a case. A good custodian interview requires special technical knowledge and skills, which, unfortunately, most lawyers still lack. Too bad, because witness interviews are so very important to big cases with complex, messy ESI systems.

Philip Favro, an expert consultant for Driven, Inc., makes this point well in his excellent article on Small:

Fulsome custodian interviews are essential for ensuring that relevant electronically stored information (ESI) is preserved. Such interviews are characterized by exhaustive questioning on any number of topics including traditional and newer sources of ESI.

Properly conducted, custodian interviews should provide counsel with a thorough understanding of the nature and types of relevant information at issue in the litigation, together with the sources where that information is located. If custodian interviews are neglected or deficient, parties are vulnerable to data loss and court sanctions. The Small v. University Medical Center case is instructive on these issues.

Vegas Court Spotlights the Importance of Custodian Interviews with New ESI Sources (LegalTech News 8/30/18).

Phil’s explanation of some of the facts behind the Special Master ordered redo of the interviews shows how difficult some custodian interviews can be, especially when they want to hide something from the lawyers:

Once conducted, the interviews were deemed insufficient by the special master and (later on) the court. In its order, the court spotlighted some of the evasive answers that UMC’s custodians provided. For example, UMC’s director of human resources disclosed the existence of only one relevant timekeeping application despite having approved the use of other timekeeping systems for certain employees. UMC argued that its HR director was only obligated to disclose the timekeeping application he actually used:

[The custodian] did not use those applications himself and therefore had no obligation to disclose these systems in custodian interviews ordered by the special master because a “custodian interview is aimed at uncovering the applications, systems, programs, data with which the actual custodian interfaces.” (emphasis added).

The court decried this limited notion of a custodian interview, observing that it failed to satisfy UMC’s “legal obligation to identify, locate, maintain, and produce relevant information.”

In Small they never did any custodian interviews until after the case blew up and a Special Master was appointed. Even when interviews were finally conducted by defense counsel, they did a poor job; they were not well-informed of the client IT systems and were not “tough enough” with the interviewees. They seemed to be easily deceived and accepted evasive, incomplete answers. You must cross-examine and be the devils advocate for effective interviews, especially when the custodian is evasive.

Favro recommends:

Interviews should go beyond cursory questioning and focus instead on identifying all sources of relevant information. Nor should they be limited to safe topics like “where can relevant messages be found in your email account” or “where are relevant documents stored on your laptop.” Interviews should now include questions regarding the existence of information exchanged through new communications media or stored in online locations . . .

There is an art to interviews like this. The witnesses have to be comfortable telling you the truth, the full truth, without fear of reprisals. Assurances of confidentiality and witness protection can be a good tongue loosener, but do not mislead them. Remind them who you represent, typically at the very beginning.

Trust, friendliness and rapport are important in interviews, but fear has its place too. I like to tell the witness up front how important it is for them to be fully truthful and candid. A short, but stern formal reminder can go a long way if delivered properly. Since interviews are usually not under oath this is especially important. Some formality is important as part of the tongue-loosening process. Moreover, interviews like this are typically done one-on-one with no court reporter and no written statement for the witness to read and sign at the end. An interview is just two people talking, one asking all of the questions, preferably face-to-face and preferably in the witnesses office with their computer equipment at the ready to show you something, if need be.

To encourage full honesty and to help get at the truth I also sometimes inform a witness that they will likely be deposed and subject to intense cross-exam by opposing counsel. (I might possibly exaggerate the adversaries capabilities from time to time.) I point out how it will all be under oath and penalty of perjury. Then I start my role of the devils advocate, saying these are the kind of questions you will be asked, and then tear into them and make sure the story is straight and the memory not too patchy. Hey, do not get mad at me for pressing on you; these are the kind of questions you can expect and we have to be prepared. That works. Fear can be a powerful motivator of truth. So can good cross-exam. The carrot and stick approach is usually effective.

Another important guardian of truth is for the questioning attorneys to be able to look the witness in the eye and follow exactly what they are saying; full technical understanding of the ESI questions. Do not speak the language? Too technical? Then bring a translator, an expert. Do not allow the witness to speak over your head. They may well be bs-ing you. Nodding your head at everything said, even when you do not understand, is a natural lawyer tendency that you must fight against. Do not be afraid to ask stupid questions. When it comes to technical interviews of any kind I interrupt and ask questions all of the time. Much of the language used in tech and e-discovery is vague and subject to multiple meanings. You need to ask questions. Only a fool is afraid to ask questions for fear of seeming foolish.

Good interviews are a best practice to start e-discovery off right and protect clients from wasted expense and unnecessary risks. See the fine article on point by Kelly Twigger, 5 Things A Great Custodian Interview Can Do For Your Case And Your Budget (Above The Law, 6/27/17).

Proper custodian interviews require skill and training. They require the attorney or paralegal doing the interview to have a basic understanding of technology, communications software and social media. It can be challenging in some situations and even advanced practitioners need a good detailed outline to do it right. Make sure your law firm or law department has a good ESI custodian interview outline. I suggest having both a short and long form. These help even experienced lawyers to make sure they do not forget to ask something.

Expert consultants like Kelly Twigger of ESI Attorneys can help you to prepare good outlines and other tools. They can also do the most challenging tasks for you, such as prepare custom Preservation Notices, conduct Custodian Interviews, supervise ESI Collection, attend the 26(f) conference and prepare an ESI discovery plan, and ultimately, document search, review and production. An e-discovery expert can make it far easier and less expensive to stay current with the many technical-legal issues in the field.

A custodian interview can provide a wealth of information to help lawyers to find and save important evidence, but only if done properly by skilled legal practitioners. Do not risk the judge ordering a redo. Make sure you do a proper interview of the key custodians as soon as possible

Conclusion

Small shows what can happen when you take a cavalier attitude towards ESI preservation and interviews. Small v. University Medical CenterCase No. 2:13-cv-0298-APG-PAL, Report and Recommendation and Final Findings of Fact and Conclusions of Law dated August 9, 2018. Preservation errors at the beginning of a case can easily cascade into serious negligence and ESI destruction. This often results in sanctions motions and discovery about discovery. That diverts everyone from the merits of the case. In Small the sanctions not only included a permissive inference jury instruction, but also monetary sanctions, amount yet to be determined. What happened to the defendant in federal court in Vegas in Small is something that you should fear and loathe ever happening to you.

Proper timely custodian interviews could have prevented the loss of data in Small, could have prevented any sanctions. We all know that what happens in Vegas does not stay in Vegas, at least not when discovery in a law suit is concerned. The truth will come out as it should. This is especially true in a case like Small with misconduct that shocks the conscience in a mockery of justice, as Special Master Dan Garrie put it back in 2014.

Early custodian Interviews are an important, well-accepted best-practice, especially in a large matter like Small v. UMC. Interviews are the third step in the ten-step best practices of Electronic Discovery shown below. Electronic Discovery Best Practices (EDBP.com). They are one of three important activities that attorneys must perform in every law suit to preserve potential electronic evidence (shown in blue in the diagram below): hold notices, interviews and ESI collections.

See EDBP on Preservation.

In a large firm like mine, which only does Labor and Employment law, you can use one of the specialists in e-discovery to assist in these tasks, at least until you become proficient on your own. Specialists in large firms are usually experienced attorneys that now limit their work to e-discovery. (I recommend against specializing too early, but some are able to do it effectively.) In my firm there is only one full-time specialist, me, but I have over fifty attorney liaisons to assist. They have special training in e-discovery and are the go-to e-discovery lawyers for their office (we have 50), but they spend most of their time in employment litigation and other services outside of e-discovery. Other large firms have more full-time e-discovery specialists, but fewer part-time specialists. I decided to try to spread out the knowledge.

One of the things a specialists do, full or part-time, is help to create and update good standard witness interview question outlines for use by other attorneys in the firm. For instance, I have both a long and short form that I recently updated. Your firm probably has something similar. If not, do it now. Better late than never.

If you are in a smaller firm and do not have a full-time specialist in your ranks, then you should consider retaining an outside specialist as co-counsel in larger e-discovery matters. They can help you to save on overall costs and, most importantly, prevent a disaster like Small v. University Medical Center from ever darkening your door.

 

 

 


“Save Everything” and Eventually You Will Not Be Able to Find Anything: The Sedona Conference Principles and Commentary on Defensible Disposition

August 13, 2018

If you are a data hoarder, an information pack-rat that saves everything, you will eventually drown in your own data and die. Maybe not literally killed, mind you, but figuratively. Maybe not you personally, but your enterprise, your group, your project, your network. Too much information can render you and your enterprise intellectually paralyzed, cut off and seriously misinformed or uninformed. Saving it all is physically and logistically difficult, if not possible. Even if you could, keeping it all would impede your search, making it hard to find the information you need, when you need it. I address these issues this week in my review of a new commentary by The Sedona Conference Principles and Commentary on Defensible Disposition (August 2018).

Information overload is better than physical death I know, but still very bad in today’s Google world. You end up not being able to find the information you need, when you need it. That makes it hard to determine what really happened. It allows lies and liars to fester and grow. We are now seeing firsthand in the U.S. where this can lead. It is not good. It has put the whole world into a precarious situation. We need the truth to thrive as a culture; not smoke and mirrors, not conman games. A culture built on lies is a cancer. It is a deadly disease, especially for the Law, which depends on truth, on evidence, on real facts, to attain the goal of Justice.

Saving Too Much

Over-retention is the enemy of effective, efficient search. The more ESI there is to search, the more difficult the search. There can be exceptions to this rule, but for the most part it is true. That makes a “save everything” ESI policy an enemy of search. It interferes with the ability to find the information needed, which in my case is electronic evidence in legal proceedings, when it is needed. It is important for these information needs be filled quickly and completely.

Search is powerful. That is my field. The more data the better, is often true, but not always. It depends on the data and its effective life, how long a particular type of data is of any use to anyone. Big data allows for detection of patterns that would otherwise not be seen. This analysis takes CPU power. The advances in this area have been fantastic. We have the processing power, as well as the cheap storage, but our search and retrieval software has not otherwise kept up with the data explosion in volume and complexity. Predictive coding software and other AI applications have come a long way, but are still sometimes confused by the volume, variety and complexity of useless data that plagues most company IT systems.

Retrieval of specific documents and metadata takes time and specialized human skills. The more worthless data in a collection, such as spam, the greater the number false positives in a search, no matter how powerful the algorithms or skilled the searcher. Vast volumes of data make searches longer to execute and less precise. The more noise in the data, the more difficult to hear the signal. That is a fundamental law of information.

With high data volumes you can often still find the signal, the relevant documents that you need in large chaotic data collections, but it takes time and special tools and skills. There are often too many false positives in searches of data collections containing too much spam-like, useless data. Although search is strong, search alone is inadequate to meet the needs of most organizations. They also need data destruction and retention policies that govern all information. That is one reason why the success of information governance depends on data disposition.

An organization should save as much as it needs, but not too much, and also not too little. It is a Goldilocks situation. If you do not save data, you can never find it. If you save too little, then what you later need might not be there to be found. But if you save too much, you may never be able to find what you need. The signal may be in the collection to be found, in plain view, but hidden in the vast numbers, the noise of spam and other irrelevancies.

Search v. Destroy

I have debated Information Governance leaders for years the importance of search versus file destruction. I was pretty much the only advocate for search over disposition. I favored retention over destruction in most close cases, but I had a cost and proportionality overlay. I am reminded, for instance, of my debate with Jason Baron on the subject at the IQPC 10th Anniversary of Information Governance and eDiscovery, where he managed to quote Churchill at the end and won the debate hands-down. e-Disco News, Knowledge and Humor: What’s Happening Today and Likely to Happen Tomorrow (e-Discovery Team, June 7, 2015); Information Governance v Search: The Battle Lines Are Redrawn (e-Discovery Team, Feb. 8, 2015).

I did not consider it a fair debate because of Jason’s very successful pandering to the jury during his closing argument with a quote by Churchill from his speech, We Shall Fight on the Beaches. That’s the one about never surrendering in the fight against “the odious apparatus of Nazi rule” (sadly, this exhortation still has legs today in the US).

The debate was “unfair” primarily because this was an IG conference. Everybody in IG is pro-destruction and values disposition over search. I think most IG leaders go too far, that they are trigger happy to kill data. I pointed out in my debates that once a file is deleted, it cannot be found, no matter how good your filing, no matter how good your search (forensic recovery issues aside).

I am pro-search and think that the importance of management of ESI by filing and disposition is somewhat overblown. I think search is king, not data deletion. Still, even in my most strident of debates and pro-search arguments, I never advocated for the retention of all data. I always assumed that some file disposition was required and accepted that as a given. I was not a save everything and search advocate. I advocated for both, search and destroy. I advocated for more retention than most, but have never argued to retain everything.

There is a common core of agreement that some ESI should be deleted, that all data should not be saved. The disagreement is on how much data to save. How does a person or company know what is the “just right” data destruction policy for that company? There is agreement among experts that there is no one-size-fits-all solution, so custom work is required. Different retention and destruction policies should apply depending on the company and the particularities of their data universe. Many IG specialists advise clients on the custom fit they need. It involves careful investigation of the company, its data and activities, including law suits and other investigations.

The Sedona Conference  Principles and Commentary on Defensible Disposition

Kevin Brady

Kevin Brady

These IG specialists, and the companies they serve, now have an excellent new resource tool to analyze and custom-fit data destruction policies. The Sedona Conference Principles and Commentary on Defensible Disposition (August 2018 Public Comment Version) (Editors-in-Chief, Kevin F. Brady and Dean Kuckelman). I highly recommend this new and excellent work by The Sedona Conferences. My commendations to the Drafting Team: Lauren A. Allen, Jesse Murray, Ross Gotler, Ken Prine, Logan J. Herlinger, David C. Shonka, Mark Kindy; the Drafting Team Leaders: Tara Emory and Becca Rausch; the Staff Editor: Susan McClaim, and Editors-in-Chief, Kevin F. Brady and Dean Kuckelman. Please send to them any comments you may have.

The Commentary begins in usual Sedona fashion by articulation of basic principles and comments tied to principles. The cases and legal authorities cited in all Commentaries by The Sedona Conference are excellent. This commentary on data disposition is no exception. I commend it for your detailed study and reference. Free download here from The Sedona Conference.

The Principles are:

PRINCIPLE 1.    Absent a legal retention or preservation obligation, organizations may dispose of their information.

Comment 1.a.   An organization should, in the ordinary course of business, properly dispose of information that it does not need.

Comment 1.b.   When designing and implementing an information disposition program, organizations should consider the obligation to preserve information that is relevant to the claims and defenses and proportional to the needs of any pending or anticipated litigation.

Comment 1.c. When designing and implementing an information disposition program, organizations should consider the obligation to preserve information that is relevant to the subject matter of government inquiries or investigations that are pending or threatened against the organization.

Comment 1.d.   When designing and implementing an information disposition program, organizations should consider applicable statutory and regulatory obligations to retain information.

PRINCIPLE 2.    When designing and implementing an information disposition program, organizations should identify and manage the risks of over-retention.

Comment 2.a.   Information has a lifecycle, including a time when disposal is beneficial.

Comment 2.b. To determine the “right” time for disposal, risks and costs of retention and disposal should be evaluated.

PRINCIPLE 3.    Disposition should be based on Information Governance policies that reflect and harmonize with an organization’s information, technological capabilities, and objectives.

Comment 3.a.   To create effective information disposition policies, organizations should establish core components of an Information Governance program, which should reflect what information it has, when it can be disposed of, how it is stored, and who owns it.

Comment 3.b. An organization should understand its technological capabilities and define its information objectives in the context of those capabilities.

Document Disposition and Information Governance

The Sedona Conference Principles and Commentary on Defensible Disposition builds upon Sedona’s earlier work, the Sedona Conference Commentary on Information Governance (Oct. 2014). Principle 6 of the Commentary on Information Governance provides the following guidance to organizations:

The effective, timely, and consistent disposal of physical and electronic information that no longer needs to be retained should be a core component of any Information Governance program. The Sedona Conference, Commentary on Information Governance, 15 SEDONA CONF. J. 125, 146 (2014) (“Information Governance” is “an organization’s coordinated, interdisciplinary approach to satisfying information compliance requirements and managing information risks while optimizing information value.” Id. at 126).

The Comment to Principle 6 goes on to explain:

It is a sound strategic objective of a corporate organization to dispose of information no longer required for compliance, legal hold purposes, or in the ordinary course of business. If there is no legal retention obligation, information should be disposed as soon as the cost and risk of retaining the information is outweighed by the likely business value of retaining the information. . . . Typically, the business value decreases and the cost and risk increase as information ages. Id. at 147.

The Sedona Conference concluded in 2018 that this 2014 advice, and similar advice from other sources, has not been followed by most organizations. instead, they continue to struggle to make “effective disposition decisions.” The group in Principles and Commentary on Defensible Disposition concluded in its Introduction that this struggle was caused by many factors, but identified the three main problems:

[T]he incorrect belief that organizations will be forced to “defend” their disposition
actions if they later become involved in litigation. Indeed, the phrase “defensible disposition” suggests that organizations have a duty to defend their information disposition actions. While it is true that organizations must make “reasonable and good faith efforts to retain information that is relevant to claims or defenses,” that duty to preserve information is not triggered until there is a “reasonably anticipated or pending litigation” or other legal demands for records. The Sedona Principles, Third Edition: Best Practices, Recommendations & Principles for Addressing Electronic Document Production, 19 SEDONA CONF. J. 1, 51, Principle 5, 93 (2018).

Another factor in the struggle toward effective disposition of information is the difficulty in appreciating how such disposition reduces costs and risks.

Lastly, many organizations struggle with how to design and implement effective disposition as part of their overall Information Governance program.

The Principles and Commentary on Defensible Disposition attempt to address these three factors and provide guidance to organizations, and the professionals who counsel organizations, on developing and implementing an effective disposition program.

Disposition Challenges

The Sedona Conference Principles and Commentary on Defensible Disposition (August, 2018) concludes by identifying the main challenges to data deletion.

  1. Unstructured Information.
  2. Mergers and Acquisitions.
  3. Departed, Separated, or Former Employees
  4. Shared File Sites
  5. Personally Identifiable Information (“PII”)
  6. Law Firms, eDiscovery Vendors, and Adversaries
  7. In-House Legal Departments
  8. Hoarders (my personal favorite)
  9. Regulations
  10. Cultural Change and Training

There are more, I am sure, but this is a good top ten list to start. I only wish they had included more discussion of these top ten.

Conclusion

Search is still more important for me than destroy. I prefer Where’s Waldo over Kill Waldo! I have not changed my position on that. But neither has mainstream Information Governance. They still disagree with my emphasis on Search. But everyone agrees that we should do both: Search and Destroy. Even I do not want companies to save all of their data. Some data should be destroyed.

I agree with mainstream IG that saving everything forever is not a viable information governance policy, no matter how many resources you also put into ESI search and retrieval. I have never said that you should rely solely on search, just that you should give Search more importance and, when in doubt, that you should save more documents than less. The Search and Destroy argument has always been one of a matter of degree and balance, not whether there should be no destruction at all. The difficult questions involve what should be saved and for how long, which are traditional information management problems.

Where to draw the line on destruction is the big question for everyone. The answer is always company specific, even project specific. It involves questions of varying retention times, files type and custodian analysis. When it comes down to specific decisions, and close questions, I generally favor retention. What may appear to be useless today, may prove to be relevant evidence tomorrow. I hate not being able to prove my case because all of the documents have already been deleted. Then it is just one person’s word against another. IG experts, who usually no longer litigate, or never litigated, do not like my complaints. They are eager to kill, to purge and destroy data. I am more inclined to save and search, but not save too much. It is a question of balance.

Data destruction – the killing of data – can, if done properly, make the search for relevant content much easier. Some disposition of obviously irrelevant, spam and otherwise useless information makes sense on every level. It helps all users of the IT system. It also helps with legal compliance. Too much destruction of data, too aggressive, and you may end up deleting information that you were required by law to keep. You could lose a law suit because of one mistake in a data disposition decision. Where do you draw the line between save and delete? What is the scope of a preservation duty? What files types should be retained? What retention times should apply? How much is too much? Not enough?

The questions go on and on and there is no one right answer. It all depends on the facts and circumstances of the organization and its data. The new Sedona Conference Principles and Commentary on Defensible Disposition is an important new guide to help IT lawyers and technologists to craft custom answers to these questions.

 


Responding Party’s Complaints of Financial Burden of Document Review Were Unsupported by the Evidence, Any Evidence

August 5, 2018

One of the largest cases in the U.S. today is a consolidated group of price-fixing cases in District Court in Chicago. In Re Broiler Chicken Antitrust Litigation, 290 F. Supp. 3d 772 (N.D. Ill. 2017) (order denying motions to dismiss and discussing the case). The consolidated antitrust cases involve allegations of a wide spread chicken price-fixing. Big Food Versus Big Chicken: Lawsuits Allege Processors Conspired To Fix Bird Prices (NPR 2/6/18).

The level of sales and potential damages are high. For instance, in 2014 the sales of broiler chickens in the U.S. was $32.7 Billion. That’s sales for one year. The classes have not been certified yet, but discovery is underway in the consolidated cases.

The Broiler Chicken case is not only big money, but big e-discovery. A Special Master (Maura Grossman) was appointed months ago and she developed a unique e-discovery validation protocol order for the case. See: TAR for Smart Chickens, by John Tredennick and Jeremy Pickens that analyzes the validation protocol.

Maura was not involved in the latest discovery dispute where, Agri Stats, one of many defendants, claimed a request for production was too burdensome as to it. The latest problem went straight to the presiding Magistrate Judge Jeffrey T. Gilbert who issued his order on July 26, 2018. In re Broiler Chicken Antitrust Litig., 2018 WL 3586183 (N.D. Ill. 7/26/18).

Agri Stats had moved for a protective order to limit an email production request. Agri Stats claimed that the burden imposed was not proportional because it would be too expensive. Its lawyers told Judge Gilbert that it would cost between $1,200,000 and $1,700,00 to review the email using the keywords negotiated.

Fantasy Hearing

I assume that there were hearings and attorney conferences before the hearings. But I do not know that for sure. I have not seen a transcript of the hearings with Judge Gilbert. All we know is that defense counsel told the judge that under the keywords selected the document review would cost between $1,200,000 and $1,700,000, and that they had no explanation on how the cost estimate was prepared, nor any specifics as to what it covered. Although I was not there, after four decades of doing this sort of work, I have a pretty good idea of what was or might have been said at the hearing.

This representation of million dollar costs by defense counsel would have gotten the attention of the judge. He would naturally have wanted to know how the cost range was calculated. I can almost hear the judge say from the bench: “$1.7 Million Dollars to do a doc review. Yeah, ok. That is a lot of money. Why so much counsel? Anyone?” To which the defense attorneys said in response, much like the students in Ferris Beuller’s class:

“. . . . . .”

 

Yes. That’s right. They had Nothing. Just Voodoo Economics

Well, Judge Gilbert’s short opinion makes it seem that way. In re Broiler Chicken Antitrust Litig., 2018 WL 3586183 (N.D. Ill. 7/26/18).

If a Q&A interchange like this happened, either in a phone hearing, or in person, then the lawyers must have said something. You do not just ignore a question by a federal judge. The defense attorneys probably did a little hemming and hawing, conferred among themselves, and then said something to the judge like: “We are not sure how those numbers were derived, $1.2M to $1.5M, and will have to get back to you on that question, Your Honor.” And then, they never did. I have seen this kind of thing a few times before. We all try to avoid it. But it is even worse to make up a false story, or even present an unverified story to the judge. Better to say nothing and get back to the judge with accurate information.

Discovery Order of July 26, 2018

Here is a quote from Judge Gilbert’s Order so you can read for yourself the many questions the moving party left unanswered (detailed citations to record removed; graphics added):

Agri Stats represents that the estimated cost to run the custodial searches EUCPs propose and to review and produce the ESI is approximately $1.2 to $1.7 million. This estimated cost, however, is not itemized nor broken down for the Court to understand how it was calculated. For example, is it $1.2 to $1.7 million to review all the custodial documents from 2007 through 2016? Or does this estimate isolate only the pre-October 2012 custodial searches that Agri Stats does not want to have to redo, in its words? More importantly, Agri Stats also admits that this estimate is based on EUCPs’ original proposed list of search terms. But EUCPs represent (and Agri Stats does not disagree) that during their apparently ongoing discussions, EUCPs have proposed to relieve Agri Stats of the obligation to produce various categories of documents and data, and to revise the search terms to be applied to data that is subject to search. Agri Stats does not appear to have provided a revised cost estimate since EUCPs agreed to exclude certain categories of documents and information and revised their search terms. Rather, Agri Stats takes the position that custodial searches before October 3, 2012 are not proportional to the needs of the case — full stop — so it apparently has not fully analyzed the cost impact of EUCPs’ revised search terms or narrowed document and data categories.

The Court wonders what the cost estimate is now after EUCPs have proposed to narrow the scope of what they are asking Agri Stats to do. (emphasis added) EUCPs say they already have agreed, or are working towards agreement, that 2.5 million documents might be excluded from Agri Stats’s review. That leaves approximately 520,000 documents that remain to be reviewed. In addition, EUCPs say they have provided to Agri Stats revised search terms, but Agri Stats has not responded. Agri Stats says nothing about this in its reply memorandum.

EUCPs contend that Agri Stats’s claims of burden and cost are vastly overstated. The Court tends to agree with EUCPs on this record. It is not clear what it would cost in either time or money to review and produce the custodial ESI now being sought by EUCPs for the entire discovery period set forth in the ESI Protocol or even for the pre-October 3, 2102 period. It seems that Agri Stats itself also does not know for sure what it would have to do and how much it would cost because the parties have not finished that discussion. Because EUCPs say they are continuing to work with Agri Stats to reduce what it must do to comply with their discovery requests, the incremental burden on what Agri Stats now is being asked to do is not clear.

For all these reasons, Agri Stats falls woefully short of satisfying its obligation to show that the information [*10] EUCPs are seeking is not reasonably accessible because of undue burden or cost.

Estimations for Fun and Profit

In order to obtain a protective order you need to estimate the costs that will likely be involved in the discovery from which you seek protection. Simple. Moreover, it obviously has to be a reasonable estimate, a good faith estimate, supported by the facts. The Brolier Chicken defendant, Agri Stats, came up with an estimate. They got that part right. But then they stopped. You never do that. You do not just throw up a number and hope for the best. You have to explain how it was derived. Blushing at any price higher than that is not a reasonable explanation, but is often honest.

Be ready to explain how you came up with the cost estimate. To break down the total into its component parts and allow the “Court to understand how it was calculated.” Agri Stats did not do that. Instead, they just used a cost estimate of between $1.2 to $1.7 million. So of course Agri Stats’ motion for protective order was denied. The judge had no choice because no evidence to support the motion was presented, neither factual or expert evidence. There was no need for Judge Gilbert to go into the secondary questions of whether expert testimony was also needed and whether it should be under Rule 702. He got nothing remember. No explanation for the $1.7 Million.

The lesson of the latest discovery order in Broiler Chicken is pretty simple. In re Broiler Chicken Antitrust Litig., 2018 WL 3586183 (N.D. Ill. 7/26/18). Get a real cost estimate from an expert. The expert needs to know and understand document review, search and costs of review. They need to know how to make reasonable search and retrieval efforts. They also need to know how to make reliable estimates. You may need two experts for this, as not all have expertise in both fields, but they are readily available. Many can even talk pretty well too, but not all! Seriously, everybody knows we are the most fun and interesting lawyer subgroup.

The last thing to do is skimp on an expert and just pull out a number from your hat (or your vendor’s hat) and hope for the best.

This is federal court, not a political rally. You do not make bald assertions and leave the court wondering. Facts matter. Back of the envelope type guesses are not sufficient, especially in a big case like Broiler Chicken. Neither are guesstimates by people who do not know what they are doing. Make disclosure and cooperate with the requesting party to reach agreement. Do not just rush to the courthouse hoping to  dazzle with smoke and mirrors. Bring in the experts. They may not dazzle, but they can get you beyond the magic mirrors.

Case Law Background

Judge Paul S. Grewal, who is now Deputy G.C. of Facebook, said quoting The Sedona Conference in Vasudevan: There is no magic to the science of search and retrieval: only mathematics, linguistics, and hard work.Vasudevan Software, Inc. v. Microstrategy Inc., No. 11-cv-06637-RS-PSG, 2012 US Dist LEXIS 163654 (ND Cal Nov 15, 2012) (quoting The Sedona Conference, Best Practices Commentary on the Use of Search and Information and Retrieval Methods in E-Discovery, 8 Sedona Conf. J. 189, 208 (2007). There is also no magic to the art of estimation, no magic to calculating the likely range of cost to search and retrieve the documents requested. Judge Grewal refused to make any decision in Vasudevan without expert assistance, recognizing that this area is “fraught with traps for the unwary” and should not be decided on mere arguments of counsel.

Judge Grewal did not address the procedural issue of whether Rule 702 should govern. But he did cite to Judge Facciola’s case on the subject, United States v. O’Keefe, 537 F. Supp. 2d 14 (D.D.C. 2008). Here Judge Facciola first raised the discovery expert evidence issue. He not only opined that experts should be used, but that the parties should follow the formalities of Evidence Rule 702. That governs things such as whether you should qualify and swear in an expert and follow otherwise follow Rule 702 on their testimony. I discussed this somewhat in my earlier article this year, Judge Goes Where Angels Fear To Tread: Tells the Parties What Keyword Searches to Use.

Judge Facciola in O’Keffe held that document review issues require expert input and that this input should be provided with all of the protections provided by Evidence Rule 702.

Given this complexity, for lawyers and judges to dare opine that a certain search term or terms would be more likely to produce information than the terms that were used is truly to go where angels fear to tread. This topic is clearly beyond the ken of a layman and requires that any such conclusion be based on evidence that, for example, meets the criteria of Rule 702 of the Federal Rules of Evidence. Accordingly, if defendants are going to contend that the search terms used by the government were insufficient, they will have to specifically so contend in a motion to compel and their contention must be based on evidence that meets the requirements of Rule 702 of the Federal Rules of Evidence.

Conclusion

In the Boiler Chicken Antitrust Order of July 27, 2018, a motion for protective order was denied because of inadequate evidence of burden. All the responding party did was quote a price-range, a number presumably provided by an expert, but there was no explanation. More evidence was needed, both expert and fact. I agree that generally document review cost estimation requires opinions of experts. The experts need to be proficient in two fields. They need to know and understand the science of document search and retrieval and the likely costs for these services for a particular set of data.

Although all of the formalities and expense of compliance with Evidence Rule 702 may be needed in some cases, it is probably not necessary in most. Just bring your expert to the attorney conference or hearing. Yes, two experts may well disagree on some things, probably will, but the areas of agreement are usually far more important. That in turn makes compromise and negotiation far easier. Better leave the technical details to the experts to sort out. That follows the Rule 1 prime directive of “just, speedy and inexpensive.” Keep the trial lawyers out of it. They should instead focus and argue on what the documents mean.

 

 

 


Another Judge is Asked to Settle a Keyword Squabble and He Hesitates To Go Where Angels Fear To Tread: Only Tells the Parties What Keywords NOT To Use

July 15, 2018

In this blog we discuss yet another case where the parties are bickering over keywords and the judge was asked to intervene. Webastro Thermo & Comfort v. BesTop, Inc., 2018 WL 3198544, No.16-13456 (E.D. Mich. June 29, 2018). The opinion was written in a patent case in Detroit by Executive Magistrate Judge R. Steven Whalen. He looked at the proposed keywords and found them wanting, but wisely refused to go further and tell them what keywords to use. Well done Judge Whalen!

This case is similar to the one discussed in my last blog, Judge Goes Where Angels Fear To Tread: Tells the Parties What Keyword Searches to Use, where Magistrate Judge Laura Fashing in Albuquerque was asked to resolve a keyword dispute in United States v. New Mexico State University, No. 1:16-cv-00911-JAP-LF, 2017 WL 4386358 (D.N.M. Sept. 29, 2017). Judge Fashing not only found the proposed keywords inadequate, but came up with her own replacement keywords and did so without any expert input.

In my prior blog on Judge Fashing’s decision I discussed Judge John Facciola’s landmark legal search opinion in United States v. O’Keefe, 537 F. Supp. 2d 14 (D.D.C. 2008) and other cases that follow it. In O’Keefe Judge Facciola held that because keyword search questions involve complex, technical, scientific questions, that a judge should not decide such issues without the help of expert testimony. That is the context for his famous line:

Given this complexity, for lawyers and judges to dare opine that a certain search term or terms would be more likely to produce information than the terms that were used is truly to go where angels fear to tread. This topic is clearly beyond the ken of a layman and requires that any such conclusion be based on evidence that, for example, meets the criteria of Rule 702 of the Federal Rules of Evidence.

In this weeks blog I consider the opinion by Judge Whalen in Webastro Thermo & Comfort v. BesTop, Inc., 2018 WL 3198544, No.16-13456 (E.D. Mich. June 29, 2018) where he told the parties what keywords not to use, again without expert input, but stopped there. Interesting counterpoint cases. It is also interesting to observe that in all three cases, O’Keefe, New Mexico State University and Webastro, the judges end on the same note where the parties are ordered to cooperate. Ah, if it were only so easy.

Stipulated Order Governing ESI Production

In Webastro Thermo & Comfort v. BesTop, Inc., the parties cooperated at the beginning of the case. They agreed to the entry of a stipulated ESI Order governing ESI production. The stipulation included a cooperation paragraph where the parties pledge to try to resolve all ESI issues without judicial intervention. Apparently, the parties cooperation did not go much beyond the stipulated order. Cooperation broke down and the plaintiff filed a barrage of motions to avoid having to do document review, including an Emergency Motion to Stay ESI Discovery. The plaintiff alleged that the defendant violated the ESI stipulation by “propounding overly broad search terms in its request for ESI.” Oh, how terrible. Red Alert!

Plaintiffs further accused defense counsel of “propounding prima facie inappropriate search criteria, and refusal to work in good faith to target its search terms to specific issues in this case.” Again, the outrageous behavior reminds me of the Romulans. I can see why plaintiff’s counsel called an emergency and asked for costs and relief from having to produce any ESI at all. That kind of approach rarely goes over well with any judge, but here it worked. That’s because the keywords the defense wanted plaintiff to use in its search for relevant ESI were, in fact, very bad.

Paragraph 1.3(3) of the ESI Order establishes a protocol designed to constrain e-discovery, including a limitation to eight custodians with no more than ten keyword search terms for each. It goes on to provide the following very interesting provision:

The search terms shall be narrowly tailored to particular issues. Indiscriminate terms, such as the producing company’s name or its product name, are inappropriate unless combined with narrowing search criteria that significantly reduce the risk of overproduction. A conjunctive combination of multiple words or phrases (e.g. ‘computer’ and ‘system’) narrows the search and shall count as a single term. A disjunctive combination of multiple words or phrases (e.g. ‘computer’ or ‘system’) broadens the search, and thus each word or phrase shall count as a separate search term unless they are variants of the same word. Use of narrowing search criteria (e.g. ‘and,’ ‘but not,’ ‘w/x’) is encouraged to limit the production and shall be considered when determining whether to shift costs for disproportionate discovery.

Remember, this is negotiated wording that the parties agreed to, including the bit about product names and “conjunctive combination.”

Defendant’s Keyword Demands

The keywords proposed by defense counsel for plaintiff’s search then included: “Jeep,” “drawing” and its abbreviation “dwg,” “top,” “convertible,” “fabric,” “fold,” “sale or sales,” and the plaintiff’s product names,  “Swaptop” and “Throwback.”

Plaintiff’s counsel advised Judge Whalen that the ten terms created the following results with five custodians (no word on the other three):

  • Joseph Lupo: 30 gigabytes, 118,336 documents.
  • Ryan Evans: 13 gigabytes, 44,373 documents.
  • Tyler Ruby: 10 gigabytes, 44,460 documents.
  • Crystal Muglia: 245,019 documents.
  • Mark Denny: 162,067 documents.
In Footnote Three Judge Whalen adds, without citation to authority or the record, that:
One gigabyte would comprise approximately 678,000 pages of text. 30 gigabytes would represent approximately 21,696,000 pages of text.

Note that Catalyst did a study of average number of files in a gigabyte in 2014. They found that the average number was 2,500 files per gigabyte. They suggest using 3,000 files per gigabyte for cost estimates, just to be safe. So I have to wonder where Judge Whalen got this 678,000 pages of text per gigabyte.

Plaintiff’s counsel added that:

Just a subset of the email discovery requests propounded by BesTop have returned more than 614,00 documents, comprising potentially millions of individual pages for production.

Plaintiff’s counsel also filed an affidavit where he swore that he reviewed the first 100 consecutively numbered documents to evaluate the burden. Very impressive effort. Not! He looked at the first one-hundred documents that happened to be on top of a 614,000 pile. He also swore that none of these first one-hundred were relevant. (One wonders how many of them were empty pst container files. They are often the “documents” found first in consecutive numbering of an email collection. A better sample might have been to look at the 100 docs with the most hits.)

Judge Whalen Agrees with Plaintiff on Keywords

Judge Whalen agreed with plaintiff and held that:

The majority of defendant’s search terms are overly broad, and in some cases violate the ESI Order on its face. For example, the terms “throwback” and “swap top” refer to Webasto’s product names, which are specifically excluded under 1.3(3) of the ESI Order.

The overbreadth of other terms is obvious, especially in relation to a company that manufactures and sells convertible tops: “top,” “convertible,” “fabric,” “fold,” “sale or sales.” Using “dwg” as an alternate designation for “drawing” (which is itself a rather broad term) would call into play files with common file extension .dwg.

Apart from the obviously impermissible breadth of BesTop’s search terms, their overbreadth is borne out by Mr. Carnevale’s declarations, which detail a return of multiple gigabytes of ESI potentially comprising tens of millions of pages of documents, based on only a partial production. In addition, the search of just the first 100 records produced using BesTop’s search terms revealed that none were related to the issues in this lawsuit. Contrary to BesTop’s contention that Webasto’s claim of prejudice is conclusory, I find that Webasto has sufficiently “articulate[d] specific facts showing clearly defined and serous injury resulting from the discovery sought ….” Nix, 11 Fed.App’x. at 500.

Thus, BesTop’s reliance on City of Seattle v. Professional Basketball Club, LLC, 2008 WL 539809 (W.D. Wash. 2008), is inapposite. In City of Seattle, the defendant offered no facts to support its assertion that discovery would be overly burdensome, instead “merely state[ing] that producing such emails ‘would increase the email universe exponentially[.]’” Id. at *3. In our case, Webasto has proffered hard numbers as to the staggering amount of ESI returned based on BesTop’s search requests. Moreover, while disapproving of conclusory claims of burden, the Court in City of Seattle recognized that the overbreadth of some search terms would be apparent on their face:

“‘[U]nless it is obvious from the wording of the request itself that it is overbroad, vague, ambiguous or unduly burdensome, an objection simply stating so is not sufficiently specific.’” Id., quoting Boeing Co. v. Agric. Ins. Co., 2007 U.S. Dist. LEXIS 90957, *8 (W.D.Wash. Dec. 11, 2007).

As discussed above, many of BesTop’s terms are indeed overly general on their face. And again, propounding Webasto’s product names (e.g., “throwback” and “swap top”) violates the express language of the ESI Order.

Defense Counsel Did Not Cooperate

Judge Whalen then went on to address the apparent lack of cooperation by defendant.

Adversarial discovery practice, particularly in the context of ESI, is anathema to the principles underlying the Federal Rules, particularly Fed.R.Civ.P. 1, which directs that the Rules “be construed, administered, and employed by the court and the parties to secure the just, speedy, and inexpensive determination of every action and proceeding.” In this regard, the Sedona Conference Cooperation Proclamation states:

“Indeed, all stakeholders in the system–judges, lawyers, clients, and the general pubic–have an interest in establishing a culture of cooperation in the discovery process. Over-contentious discovery is a cost that has outstripped any advantage in the face of ESI and the data deluge. It is not in anyone’s interest to waste resources on unnecessary disputes, and the legal system is strained by ‘gamesmanship’ or ‘hiding the ball,’ to no practical effect.”

The stipulated ESI Order, which controls electronic discovery in this case, is an important step in the right direction, but whether as the result of adversarial overreach or insufficient effort, BesTop’s proposed search terms fall short of what is required under that Order.

Judge Whalen’s Ruling

Judge Whalen concluded his short Order with the following ruling:

For these reasons, Webasto’s motion for protective order [Doc. #78] is GRANTED as follows:

Counsel for the parties will meet and confer in a good-faith effort to focus and narrow BesTop’s search terms to reasonably limit Webastro’s production of ESI to emails relevant (within the meaning of Rule 26) to the issues in this case, and to exclude ESI that would have no relationship to this case.

Following this conference, and within 14 days of the date of this Order, BesTop will submit an amended discovery request with the narrowed search terms.  …

Because BesTop will have the opportunity to reformulate its discovery request to conform to the ESI Order, Webasto’s request for cost-shifting is DENIED at this time. However, the Court may reconsider the issue of cost-shifting if BesTop does not reasonably narrow its requests.

Difficult to Cooperate on Legal Search Without the Help of Experts

The defense in Webastro violated their own stipulation by the use of a party’s product names without further Boolean limiters, such as “product name AND another term.” Then defense counsel added insult to injury by coming across as uncooperative. I don’t know if they alone were uncooperative, or if it was a two way street, but appearances are everything. The emails between counsel were attached to the motions, and the judge scowled at the defense here, not plaintiff’s counsel. No judge likes attorneys who ignore orders, stipulated or otherwise, and are uncooperative to boot. “Uncooperative” is  label that you should avoid being called by a judge, especially in the world of e-discovery. Better to be an angel for discovery and save the devilish details for motions and trial.

In Webastro Thermo & Comfort v. BesTop, Inc., Judge Whalen struck down the proposed keywords without expert input. Instead Judge Whalen based his order on some incomplete metrics, namely the number of hits produced by the keywords that defense dreamed up. At least Judge Whalen did not go further and order the use of specific keywords as Judge Fashing did in United States v. New Mexico State University. Still, I wish he had not only ordered the parties to cooperate, but also ordered them to bring in some experts to help with the search tasks. You cannot just talk your way into good searches. No matter what the level of cooperation, you still have to know what you are doing.

If I had been handling this for the plaintiff, I would have gotten my hands much dirtier in the digital mud, meaning I would have done far more than just look at the first one-hundred of 614,000 documents. That was a poor quality control test, but obviously, here at least, was better than nothing. I would have done a sample review of each keyword and evaluated the precision of each. Some might have been ok as is, although probably not. They usually require some refinement. Sometimes it only takes a few minutes of review to determine that. Bottom line, I would have checked out the requested keywords. There were only ten here. That would take maybe three hours or so with the right software. You do not need big judgmental sampling most of the time to see the effectiveness, or not, or keywords.

The next step is to come up with, and test, a number of keyword refinements based on what you see in the data. Learn from the data. Test and improve various keyword combinations. That can take a few more hours. Some may think this is too much work, but it is far less time than preparing motions, memos and attending hearings. And anyway, you need to find the relevant evidence for your case.

After the tests, you share what you learned with opposing counsel and the judge, assuming they want to know. In my experience, most could care less about your methods, so long as your production includes the information they were looking for. You do not have to disclose your every little step, but you should at least advise, again if asked, information about “hit results.” This disclosure alone can go a long way, as this opinion demonstrates. Plaintiff’s counsel obtained very little data about the ineffectiveness of the defendants proposed searched terms, but that was enough to persuade the judge to enter a protective order.

To summarize, after evaluating the proposed search terms I would have improved on them. Using the improved searches I would have begun the attorney review and production. I would have shared the search information, cooperated as required by stipulation, case-law and rules, and gone ahead with my multimodal searches. I would use keywords and the many other wonderful kinds of searches that the Legal Technology industry has come up with in the last 25 years or so since keyword search was new and shiny.

Conclusion

The stipulation the parties used in Webastro could have been used at the turn of the century. Now it seems a little quaint, but alas, suits most inexperienced lawyers today. Anyway, talking about and using keywords is a good way to start a legal search. I sometimes call that Relevancy Dialogues or ESI Communications. Try out some keywords, refine and use them to guide your review, but do not stop there. Try other types of search too. Multimodal. Harness the power of the latest technology, namely AI enhanced search (Predictive Coding). Use statistics too and random sampling to better understand the data prevalence and overall search effectiveness.

If you do not know how to do legal search, and I estimate that 98% of lawyers today do not, then hire an expert. (Or take the time to learn, see eg TARcourse.com.) Your vendor probably has a couple of search experts. There may also be a lawyer in town with this expertise. Now there are even a few specialty law firms that offer these services nationwide. It is a waste of time to reinvent the Wheel, plus it is an ethical dictate under Rule 1.1 – Competence, to associate with competent counsel on a legal task when you are not.

Regarding the vendor experts, remember that even though they may be lawyers, they can only go so far. They can only provide technical advice, not legal, such as proportionality analysis under Rule 26, etc. That requires a practicing lawyer who specializes in e-discovery, preferably as a full-time specialty and not just something they do every now and then. If you are in a big firm, like I am, find the expert in your firm who specializes in e-discovery, like me. They will help you. If your firm does not have such an expert, better get one, either that or get used to losing and having your clients complain.

 


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