Lawyers’ Job Security in a Near Future World of AI, the Law’s “Reasonable Man Myth” and “Bagley Two” – Part One

January 15, 2017

bad-robotDoes the inevitable triumph of AI robots over human reason and logic mean that the legal profession is doomed? Will Watson be the next generation’s lawyer of choice? I do no think so and have written many articles on why, including two last year: Scientific Proof of Law’s Overreliance On Reason: The “Reasonable Man” is Dead and the Holistic Lawyer is Born; and The Law’s “Reasonable Man,” Judge Haight, Love, Truth, Justice, “Go Fish” and Why the Legal Profession Is Not Doomed to be Replaced by Robots. In the Reasonable Man article I discussed how reasonability is the basis of the law, but that it is not objective. It depends on many subjective factors, on psychology. In the Scientific Proof article I continued the argument and argued:

The Law’s Reasonable Man is a fiction. He or she does not exist. Never has, never will. All humans, including us lawyers, are much more complex than that. We need to recognize this. We need to replace the Law’s reliance on reason alone with a more realistic multidimensional holistic approach.

Scientific Proof Article

brain_gears_NOTo help make my argument in the Scientific Proof article I relied on the analysis of Thomas H. Davenport and Julia Kirby in Only Humans Need Apply: Winners and Losers in the Age of Smart Machines (Harper 2016) and on the scientific work of Dan Ariely, a Professor of Psychology and Behavioral Economics at Duke University.

I cite to Only Humans Need Apply: Winners and Losers in the Age of Smart Machines to support my thesis:

Although most lawyers in the profession do not know it yet, the non-reasoning aspects of the Law are its most important parts. The reasoning aspects of legal work can be augmented. That is certain. So will other aspects, like reading comprehension. But the other aspects of our work, the aspects that require more than mere reason, are what makes the Law a human profession. These job functions will survive the surge of AI.

If you want to remain a winner in future Law, grow these aspects. Only losers will hold fast to reason. Letting go of the grip of the Reasonable Man, by which many lawyers are now strangled, will make you a better lawyer and, at the same time, improve your job security.

Also see Dean Gonsowski, A Clear View or a Short Distance? AI and the Legal Industry; and, Gonsowski, A Changing World: Ralph Losey on “Stepping In” for e-Discovery, (Relativity Blog).

Professor Ariely has found from many experiments that We’re All Predictably Irrational. In my article, Scientific ProofI point my readers to his many easily accessible video talks on the subject. I consider the implication of Professor Ariely’s research on the law:

Our legal house needs a new and better foundation than reason. We must follow the physicists of a century ago. We must transcend Newtonian causality and embrace the more complex, more profound truth that science has revealed. The Reasonable Man is a myth that has outlived its usefulness. We need to accept the evidence, and move on. We need to develop new theories and propositions of law that confirm to the new facts at hand. Reason is just one part of who we are. There is much more to us then that: emotion, empathy, creativity, aesthetics, intuition, love, strength, courage, imagination, determination – to name just a few of our many qualities. These things are what make us uniquely human; they are what separate us from AI. Logic and reason may end up being the least of our abilities, although they are still qualities that I personally cherish. …

Davinci_whole_manSince human reason is now known to be so unreliable, and is only a contributing factor to our decisions, on what should we base our legal jurisprudence? I believe that the Reasonable Man, now that he is known to be an impossible dream, should be replaced by the Whole Man. Our jurisprudence should be based on the reality that we are not robots, not mere thinking machines. We have many other faculties and capabilities beyond just logic and reason. We are more than math. We are living beings. Reason is just one of our many abilities.

So I propose a new, holistic model for the law. It would still include reason, but add our other faculties. It would incorporate our total self, all human attributes. We would include more than logic and reason to judge whether behavior is acceptable or not, to consider whether a resolution of a dispute is fair or not. Equity would regain equal importance.

A new schemata for a holistic jurisprudence would thus include not just human logic, but also human emotions, our feelings of fairness, our intuitions of what is right and just, and multiple environmental and perceptual factors. I suggest a new model start simple and use a four-fold structure like this, and please note I keep Reason on top, as I still strongly believe in its importance to the Law.

4-levels-Holistic_Law_pyramid

My Scientific Proof article included a call to action, the response to which has been positive:

The legal profession needs to take action now to reduce our over-reliance on the Myth of the Reasonable Man. We should put the foundations of our legal system on something else, something more solid, more real than that. We need to put our house in order before it starts collapsing around us. That is the reasonable thing to do, but for that very reason we will not start to do it until we have better motivation than that. You cannot get people to act on reason alone, even lawyers. So let us engage the other more powerful motivators, including the emotions of fear and greed. For if we do not evolve our work to focus on far more than reason, then we will surely be replaced.

cyborg-lawyer

AI can think better and faster, and ultimately at a far lower cost. But can AI reassure a client? Can it tell what a client really wants and needs. Can AI think out of the box to come up with new, creative solutions. Can AI sense what is fair? Beyond application of the rules, can it attain the wisdom of justice. Does it know when rules should be bent and how far? Does it know, like any experienced judge knows, when rules should be broken entirely to attain a just result? Doubtful.

I go on to make some specific suggestions, just to start the dialogue, and then closed with the following:

We must move away from over-reliance on reason alone. Our enlightened self-interest in continued employment in the rapidly advancing world of AI demands this. So too does our quest to improve our system of justice, to keep it current with the rapid changes in society.

Where we must still rely on reason, we should at the same time realize its limitations. We should look for new technology based methods to impose more checks and balances on reason than we already have. We should create new systems that will detect and correct the inevitable errors in reason that all humans make – lawyers, judges and witnesses alike. Bias and prejudice must be overcome in all areas of life, but especially in the justice system.

Computers, especially AI, should be able to help with this and also make the whole process more efficient. We need to start focusing on this, to make it a priority. It demands more than talk and thinking. It demands action. We cannot just think our way out of a prison of thought. We need to use all of our faculties, especially our imagination, creativity, intuition, empathy and good faith.

Reasonable Man Article

Reasonable_man_cloudTo help make my argument in the earlier blog, The Law’s “Reasonable Man,” Judge Haight, Love, Truth, Justice, “Go Fish” and Why the Legal Profession Is Not Doomed to be Replaced by Robots, I quoted extensively from an Order Denying Defendant’s Motion for Protective Order. The order arose out of a routine employment discrimination case. Bagely v. Yale, Civil Action No. 3:13-CV-1890 (CSH) (Doc. 108) (order dated April 27, 2015). The Order examined the “reasonability” of ESI accessibility under Rule 26(b)(2)(B) and the “reasonable” efforts requirements under Rule 26(b). I used language of that Bagley Order to help support my argument that there is far more to The Law than mere reason and logic. I also argued that this is a very good thing, for otherwise lawyers could easily be replaced by robots.

Another e-discovery order was entered in Bagley on December 22, 2016. Ruling On Plaintiff’s Motion To Compel. Bagely v. Yale, Civil Action No. 3:13-CV-1890 (CSH). Bagley Two again provokes me to write on this key topic. This second order, like the first, was written by Senior District Judge Charles S. Haight, Jr.. The eighty-six year old Judge Haight is becoming one of my favorite legal scholars because of his excellent analysis and his witty, fairly transparent writing style. This double Yale graduate has a way with words, especially when issuing rulings adverse to his alma mater. He is also one of the few judges that I have been unable to locate an online photo of, so use your imagination, which, by the way, is another powerful tool that separates us from AI juiced robots.

Lady JusticeI pointed out in the Reasonable Man article, and it bears repetition, that I am no enemy of reason and rationality. It is a powerful tool in legal practice, but it is hardly our only tool. It is one of many. The “Reasonable Man” is one of the most important ideas of Law, symbolized by the balance scales, but it is not the only idea. In fact, it is not even the most important idea for the Law. That honor goes to Justice. Lady Justice holding the scales of reason is the symbol of the Law, not the scales alone. She is usually depicted with a blindfold on, symbolizing the impartiality of justice, not dependent on the social status or position of the litigants.

My view is that lawyer reasoning should continue in all future law, but should augmented by artificial intelligence. With machines helping to rid us of hidden biases in all human reason, and making that part of our evaluation easier and more accurate, we are free to put more emphasis on our other lawyer skills, on the other factors that go into our evaluation of the case. These include our empathy, intuition, emotional intelligence, feelings, humor, perception (including lie detection), imagination, inventiveness and sense of fairness and justice. Reason is only one of many human capacities involved in legal decision making.

In Reasonable Man article I analyzed the first Bagley Order to help prove that point:

Bagley shows that the dividing line between what is reasonable and thus acceptable efforts, and what is not, can often be difficult to determine. It depends on a careful evaluation of the facts, to be sure, but this evaluation in turn depends on many subjective factors, including whether one side or another was trying to cooperate. These factors include all kinds of prevailing social norms, not just cooperativeness. It also includes personal values, prejudices, education, intelligence, and even how the mind itself works, the hidden psychological influences. They all influence a judge’s evaluation in any particular case as to which side of the acceptable behavior line a particular course of conduct falls.

In close questions the subjectivity inherent in determinations of reasonability is obvious. This is especially true for the attorneys involved, the ones paid to be independent analysts and objective advisors. People can, and often do, disagree on what is reasonable and what is not. They disagree on what is negligent and what is not. On what is acceptable and what is not.

All trial lawyers know that certain tricks of argument and appeals to emotion can have a profound effect on a judge’s resolution of these supposedly reason-based disagreements. They can have an even more profound affect on a jury’s decision. (That is the primary reason that there are so many rules on what can and cannot be said to a jury.)

lady_justice_not_blindIn spite of practical knowledge by the experienced, the myth continues in our profession that reasonability exists in some sort of objective, platonic plane of ideas, above all subjective influences. The just decision can be reached by deep, impartial reasoning. It is an article of faith in the legal profession, even though experienced trial lawyers and judges know that it is total nonsense, or nearly so. They know full well the importance of psychology and social norms. They know the impact of cognitive biases of all kinds, including, for example, hindsight biasSee Roitblat, The Schlemiel and the Schlimazel and the Psychology of Reasonableness (Jan. 10, 2014, LTN) (link is to republication by a vendor without attribution) (“tendency to see events that have already occurred as being more predictable than they were before they actually took place“); Also see Rimkus v Cammarata, 688 F. Supp. 2d 598 (S.D. Tex. 2010) (J. Rosenthal) (“It can be difficult to draw bright-line distinctions between acceptable and unacceptable conduct in preserving information and in conducting discovery, either prospectively or with the benefit (and distortion) of hindsight.” emphasis added); Pension Committee of the University of Montreal Pension Plan, et al. v. Banc of America Securities, LLC, et al., 685 F. Supp. 2d 456 (S.D.N.Y. Jan. 15, 2010 as amended May 28, 2010) at pgs. 463-464 (J. Scheindlin) (‘That is a judgment call that must be made by a court reviewing the conduct through the backward lens known as hindsight.” emphasis added).

In my conclusion to Reasonable Man article I summarized my thoughts and tried to kick off further discussion of this topic:

The myth of objectivity and the “Reasonable Man” in the law should be exposed. Many naive people still put all of their faith in legal rules and the operation of objective, unemotional logic. The system does not really work that way. Outsiders trying to automate the law are misguided. The Law is far more than logic and reason. It is more than the facts, the surrounding circumstances. It is more than evidence. It is about people and by people. It is about emotion and empathy too. It is about fairness and equity. It’s prime directive is justice, not reason.

That is the key reason why AI cannot automate law, nor legal decision making. Judge Charles (“Terry”) Haight could be augmented and enhanced by smart machines, by AI, but never replaced. The role of AI in the Law is to improve our reasoning, minimize our schlemiel biases. But the robots will never replace lawyers and judges. In spite of the myth of the Reasonable Man, there is far more to law then reason and facts. I for one am glad about that. If it were otherwise the legal profession would be doomed to be replaced by robots.

Bagley Two

Now let us see how Judge Haight once again helps prove the Reasonable Man points by his opinion in Bagley Two. Ruling On Plaintiff’s Motion To Compel (December 22, 2016), Bagely v. Yale, Civil Action No. 3:13-CV-1890 (CSH). In this opinion the reasonability of defendant Yale’s preservation efforts was considered in the context of a motion to compel discovery. His order again reveals the complexity and inherent subjectivity of all human reason. It shows that there are always multiple factors at work in any judge’s decision beyond just thought and reason, including an instinct born out of long experience for fairness and justice. Once again I will rely primarily on Judge Haight’s own words. I do so because I like the way he writes and because you need to read his original words to appreciate what I am talking about. But first, let me set the stage.

Reasonable_guageYale sent written preservation notices to sixty-five different people, which I know from thousands of matters is a very large number of custodians to put on hold in a single-plaintiff discrimination case. But Yale did so in stages, starting on March 1, 2013 and ending on August 7, 2014. Eight different times over this period they kept adding people to their hold list. The notices were sent by Jonathan Clune, a senior associate general counsel of Yale University. The plaintiff argued that they were too late in adding some of the custodians and otherwise attacked the reasonability of Yale’s efforts.

The plaintiff was not seeking sanctions yet for the suspected unreasonable efforts, they were seeking discovery from Yale as to details of these efforts. Specifically they sought production of: (1) the actual litigation hold notices; (2) the completed document preservation computer survey forms that were required to be returned to the Office of General Counsel by each Litigation Hold Recipient; and, (3) an affidavit detailing the retention and production for all non-ESI documents collected from each of the Litigation hold Recipients.

Yale opposed this discovery claiming any more information as to its preservation efforts was protected from discovery under the attorney-client privilege and attorney work product protection.  Yale also argued that even if the privileges did not apply here, the discovery should still be denied because to obtain such information a party must first provide convincing proof that spoliation in fact occurred. Yale asserted that the plaintiff failed to provide sufficient proof, or even any proof, that spoliation had in fact occurred.

Here is the start of Judge Haight’s evaluation of the respective positions:

Mr. Clune’s litigation hold notices stressed that a recipient’s failure to preserve pertinent documents could “lead to legal sanctions” against Yale. Clune was concerned about a possible sanction against Yale for spoliation of evidence. While Clune’s notices did not use the term, “spoliation” is a cardinal litigation vice, known by that name to trial lawyers and judges, perhaps unfamiliar to academics unable to claim either of those distinctions. Clune’s notices made manifest his concern that a trial court might sanction Yale for spoliation of evidence relevant to the University SOM’s decision not to reappoint Bagley to its faculty.

skull_bones_yaleNote the jab at academics. By the way, in my experience his observation is correct about the cluelessness of most law professors when it comes to e-discovery. But why does Judge Haight take the time here to point that out? This case did not involve the Law School. It involved the business school professors and staff (as you would expect). It is important to know that Judge Haight is a double Yale graduate, both undergraduate and law school. He graduated from Yale Law in 1955. He was even a member of Yale’s infamous of Skull and Bones society. (What does 322 really mean? Eulogia?) Perhaps there are some underlying emotions here? Judge Haight does seem to enjoy poking Yale, but he may do that in all his cases with Yale out of an eccentric kind of good humor, like a friendly shoulder punch. But I doubt it.

To be continued … 



Top Twenty-Two e-Discovery Opinions of 2016: Number Three

December 30, 2016

Here is the e-Discovery Team’s third most interesting e-discovery opinion of 2016. In re Takata Airbag Prods. Liab. Litig., No. 15-02599-CIV-Moreno, MDL No. 5-2599 (S.D. Fla. Mar. 1, 2016).

THIRD – In re Takata Airbag

11/03/11-- Miami-- Federico A. Moreno, Chief Judge, United States District Court for the Southern District of Florida.

The number three ranked case is primarily interesting because it adds the voice of the U.S. Supreme Court concerning the new scope of relevance specified in Rule 26(b)(1) and other revisions contained in the 2015 Amendments. In re Takata Airbag Prods. Liab. Litig., No. 15-02599-CIV-Moreno, MDL No. 5-2599 (S.D. Fla. Mar. 1, 2016). The Takata Airbag case is one of the largest multi-district class actions in the country. Chief District Court Judge Federico A. Moreno of the Southern District of Florida in Miami was overseeing the Takata Airbag multi-district litigation when he authored this e-discovery order pertaining to the new relevancy rule. Fortunately, Judge Moreno had previously made time to read Chief Justice Roberts 2015 Year-End Report on the Federal Judiciary. He cited to and quoted Justice Roberts on discovery in his Takata opinion.

On March 1, 2016 Judge Moreno considered a recommendation of a Special Master to accept the defendants’ proposal to withhold or redact irrelevant parent documents from responsive families. This is an issue that can arise in any case involving the production of emails. It is often known informally in the trade as the Orphan Child issue. It arises when an email attachment is relevant and so must be produced, but the email transmitting the attachment, called the “parent,” is not relevant. In other words, the parent is irrelevant on its face, but the child attachment is relevant.  Typically such parent transmittal emails are produced to help place the relevant attachments (children) into context.

The defendants in Takata proposed to redact information on irrelevant parent emails pertaining to seven categories of irrelevance. This request to withhold or redact was made to protect irrelevant trade secrets from disclosure, while at the same time avoiding orphan child production; in other words, avoiding production of attachments without also producing and identifying the transmittal emails.

The Plaintiffs had objected to, in Judge Moreno’s words:

… redacting information pertaining to seven proposed categories and argue the [special master’s] report is based on an inaccurate premise that Plaintiffs consented to irrelevance redactions in responsive documents, is inconsistent with the Federal Rules of Civil Procedure in allowing irrelevance redactions that will potentially allow redaction of highly relevant information from responsive documents, will impair Plaintiffs’ discovery efforts; and will lead to unnecessary litigation over the redactions.

Judge Moreno reviewed the Special Master’s recommendation de novo and agreed in part with the plaintiffs that the redactions allowed by the Master were too broad. Judge Moreno allowed redaction of the parent emails, but limited the categories of information that could be redacted. Judge Moreno reached this result by interpreting the language of amended Rule 26(b)(1).

justice_john_robertsJudge Moreno quoted Chief Justice John Roberts’ comments in the 2015 Year-End Report that the newly amended Fed.R.Civ.Pro. 26 “crystalizes the concept of reasonable limits in discovery through increased reliance on the common-sense concept of proportionality.” 2015 Year-End Report on the Federal Judiciary. Here are additional excerpts of the Supreme Court’s 2015 Year-End Report:

The amendments may not look like a big deal at first glance, but they are. That is one reason I have chosen to highlight them in this report. For example, Rule 1 of the Federal Rules of Civil Procedure has been expanded  by a mere eight words, but those are words that judges and practitioners must take to heart. Rule 1 directs that the Federal Rules “should be construed, administered, and employed by the court and the parties to secure the just, speedy, and inexpensive determination of every action and proceeding.” The underscored words make express the obligation of judges and lawyers to work cooperatively in controlling the expense and time demands of litigation—an obligation given effect in the amendments that follow. The new passage highlights the point that lawyers—though representing adverse parties—have an affirmative duty to work together, and with the court, to achieve prompt and efficient resolutions of disputes.

rule_26b1Rule 26(b)(1) crystalizes the concept of reasonable limits on discovery through increased reliance on the common-sense concept of proportionality:

Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.”

The amended rule states, as a fundamental principle, that lawyers must size and shape their discovery requests to the requisites of a case. Specifically, the pretrial process must provide parties with efficient access to what is needed to prove a claim or defense, but eliminate unnecessary or wasteful discovery. The key here is careful and realistic assessment of actual need. That assessment may, as a practical matter, require the active involvement of a neutral arbiter—the federal judge—to guide decisions respecting the scope of discovery.

The amended rules accordingly emphasize the crucial role of federal judges in engaging in early and effective case management. The prior rules—specifically Rule 16—already required that the judge meet with the lawyers after the complaint is filed, confer about the needs of the case, and develop a case management plan. The amended rules have shortened the deadline for that meeting and express a preference for a face-to-face encounter to enhance communication between the judge and lawyers. The amendments also identify techniques to expedite resolution of pretrial discovery disputes, including conferences with the judge before filing formal motions in aid of discovery. Such conferences can often obviate the need for a formal motion—a well-timed scowl from a trial judge can go a long way in moving things along crisply.

Recognizing the evolving role of information technology in virtually every detail of life, the amended rules specifically address the issue of “electronically stored information,” which has given birth to a new acronym—“ESI.” Rules 16 and 26(f) now require the parties to reach agreement on the preservation and discovery of ESI in their case management plan and discovery conferences.

rule_37eredAmendments to Rule 37(e) effect a further refinement by specifying the consequences if a party fails to observe the generally recognized obligation to preserve ESI in the face of foreseeable litigation. If the failure to take reasonable precautions results in a loss of discoverable ESI, the courts must first focus on whether the information can be restored or replaced through alternative discovery efforts. If not, the courts may order additional measures “no greater than necessary” to cure the resulting prejudice. And if the loss of ESI is the result of one party’s intent to deprive the other of the information’s use in litigation, the court may impose prescribed sanctions, ranging from an adverse jury instruction to dismissal of the action or entry of a default judgment. …

The 2015 civil rules amendments are a major stride toward a better federal court system. But they will achieve the goal of Rule 1—“the just, speedy, and inexpensive determination of every action and proceeding”— only if the entire legal community, including the bench, bar, and legal academy, step up to the challenge of making real change. …

Chief Justice John G. RobertsJudges must be willing to take on a stewardship role, managing their cases from the outset rather than allowing parties alone to dictate the scope of discovery and the pace of litigation. Faced with crushing dockets, judges can be tempted to postpone engagement in pretrial activities. Experience has shown, however, that judges who are knowledgeable, actively engaged, and accessible early in the process are far more effective in resolving cases fairly and efficiently, because they can identify the critical issues, determine the appropriate breadth of discovery, and curtail dilatory tactics, gamesmanship, and procedural posturing.

As for the lawyers, most will readily agree—in the abstract—that they have an obligation to their clients, and to the justice system, to avoid antagonistic tactics, wasteful procedural maneuvers, and teetering
brinksmanship. I cannot believe that many members of the bar went to law school because of a burning desire to spend their professional life wearing down opponents with creatively burdensome discovery requests or evading legitimate requests through dilatory tactics. The test for plaintiffs’ and defendants’ counsel alike is whether they will affirmatively search out cooperative solutions, chart a cost-effective course of litigation, and assume shared responsibility with opposing counsel to achieve just results.

Judge Moreno’s opinion also quoted Chief Justice Robert’s comment that “a party is not entitled to receive every piece of relevant information,” and concluded that “it is only logical” that “a party is similarly not entitled to receive every piece of irrelevant information in responsive documents if the producing party has a persuasive reason for why such information should be withheld.” Here is the full quote from Judge Moreno, one that you are likely to see in memorandums, at least in part:

‘l’he recently amended Rule 26(b)( 1 ) of the Federal Rules of Civil Procedure crystalizes the concept of reasonable limits on discovery through increased reliance on the common-sense concept of proportionality.” Chief Justice John Roberts, 2015 Year-End Report on the Federal Judiciary 6 (2015). Specifically, Rule 26(b)( 1 ) states:

Parties may obtain discovery regarding any nonprivileged matter that is relevant any party’s claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.

Fed. R. Civ. P. 26(b)(1). As the Chief Justice’s comments highlight, a party is not entitled to receive every piece of relevant information. lt is only logical, then, that a party is similarly not entitled to receive every piece of irrelevant information in responsive documents if the producing party has a persuasive reason for why such information should be withheld.

Judge Moreno disagreed with all of the categories the Special Master allowed to be redacted because he found they could contain “highly relevant” information. Still, Judge Moreno agreed with the defendants’ overall point about the confidentiality and sensitivity of some of the irrelevant information. To balance the parties’ “desire to protect their competitively sensitive information” against “the importance of the issues at stake in this action and the importance of the discovery in resolving the issues at hand,” Judge Moreno accepted seven categories of information that could be redacted, but he also added a caveat that the defendants would not be permitted to redact any information in those seven categories that related to airbags.

The Court modifies the Report’s recommendation as to irrelevance redactions, such that a producing party may redact only information pertaining to the above-mentioned seven categories, so long as that information does not concern airbags.

Judge Moreno also held “it would make little difference if the producing party provides a fully redacted document or does not provide the document at all.” Therefore, the court accepted the Special Master’s recommendation and permitted the parties to withhold parent documents, with the requirement that the defendants produce a list or slip sheet for the removed documents and share the context of any withheld parent document.

The reliance in part of Judge Moreno’s Order on the 2015 Year-End Report on the Federal Judiciary by Chief Justice Roberts makes this the third most interesting opinion of the year. In re Takata Airbag Prods. Liab. Litig., No. 15-02599-CIV-Moreno, MDL No. 5-2599 (S.D. Fla. Mar. 1, 2016). Both the Opinion and Report should be considered and cited henceforth. What the Supreme Court says on discovery, especially e-discovery, is always of great interest. The same goes for Judge Moreno.


Top Twenty-Two e-Discovery Opinions of 2016: Number Four

December 30, 2016

Here is the e-Discovery Team’s fourth most interesting e-discovery opinion of 2016. In re Bard IVC Filters Prods. Liab. Litig., D. Ariz., No. MDL 15-02641-PHX DGC, 2016 U.S. Dist. LEXIS 126448 (D. Ariz. Sept. 16, 2016).

FOURTH – In re Bard IVC Filters Prods. Liab. Litig.

judge_david_campbellIn Re Bard is a very helpful case on limiting discovery and the intent of the new rules, especially Rule 26(b)(1) on scope of discovery and proportionality. In re Bard IVC Filters Prods. Liab. Litig., D. Ariz., No. MDL 15-02641-PHX DGC, 2016 U.S. Dist. LEXIS 126448 (D. Ariz. Sept. 16, 2016). The primary source of our interest in this case, and why we rank it thirteenth, is the author himself. The opinion was written by the one judge who should really know the intent of the new rules, U.S. District Court Judge David G. Campbell. Judge Campbell was the chair of the Rules Committee when the 2015 amendments were passed.

You may want to use some of the language in this decision by Judge Campbell in your briefs going forward. Here is the main language explaining the new rule and commenting on how many judges are not yet following it yet and still operating under the old rules with more expansive discovery:

rule_26b1I. New Legal Standards Governing the Scope of Discovery.

Rule 26(b)(1) of the Federal Rules of Civil Procedure was amended on December 1, 2015. The new rule defines the scope of permissible discovery as follows:

Parties may obtain discovery regarding any non-privileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the party’s access to relevant information, the party’s resources, the importance of the discovery in resolving the issues, and whether the burden and expense of the proposed discovery outweighs its likely benefit.

Fed. R. Civ. P. 26(b)(1).

A. Relevancy.

To be discoverable under the first part of this test, information must be “relevant to any party’s claim or defense.” Id. This language has not changed from the previous version of Rule 26(b)(1). 

Before the 2015 amendments, Rule 26(b)(1) also provided that inadmissible evidence was discoverable if it “appears reasonably calculated to lead to the discovery of admissible evidence.” Some courts – and many lawyers – used this language to define the scope of discovery. See, e.g., Surfvivor Media, Inc. v. Survivor Prods., 406 F.3d 625, 635 (9th Cir. 2005) (“Relevant information for purposes of discovery is information ‘reasonably calculated to lead to the discovery of admissible evidence.’”) (quoting Brown Bag Software v. Symantec Corp., 960 F.2d 1465, 1470 (9th Cir. 1992)).

This phrase was eliminated by the 2015 amendments and replaced with a more direct declaration of the phrase’s original intent: “Information within this scope of discovery need not be admissible in evidence to be discoverable.” Fed. R. Civ. P. 26(b)(1). The Advisory Committee on the Federal Rules of Civil Procedure provided this explanation for the deletion:

The former provision for discovery of relevant but inadmissible information that appears “reasonably calculated to lead to the discovery of admissible evidence” is also deleted. The phrase has been used by some, incorrectly, to define the scope of discovery. As the Committee Note to the 2000 amendments observed, use of the “reasonably calculated” phrase to define the scope of discovery “might swallow any other limitation on the scope of discovery.” The 2000 amendments sought to prevent such misuse by adding the word “relevant” at the beginning of the sentence, making clear that “relevant” means within the scope of discovery as defined in this subdivision . . . .” The “reasonably calculated” phrase has continued to create problems, however, and is removed by these amendments.

Rule 26, Advis. Comm. Notes for 2015 Amends.

The 2015 amendments thus eliminated the “reasonably calculated” phrase as a definition for the scope of permissible discovery. Despite this clear change, many courts  continue to use the phrase. Old habits die hard.1 In this circuit, courts cite two Ninth Circuit cases – Surfvivor Media, Inc. v. Survivor Prods., 406 F.3d 625, 635 (9th Cir. 2005), and Brown Bag Software v. Symantec Corp., 960 F.2d 1465, 1470 (9th Cir. 1992) – for the proposition that information is relevant for purposes of Rule 26(b)(1) if it is “reasonably calculated to lead to the discovery of admissible evidence.”2 But these cases, and others like them, simply applied the earlier version of Rule 26(b)(1).

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FN 1 – Last month alone, seven cases relied on the “reasonably calculated” language to define the scope of permissible discovery. See Fastvdo LLC v. AT&T Mobility LLC, No. 16-CV-385-H (WVG), 2016 WL 4542747, at *2 (S.D. Cal. Aug. 31, 2016); Sierra Club v. BNSF Ry. Co., No. C13-0967-JCC, 2016 WL 4528452, at *1 (W.D. Wash. Aug. 30, 2016); Shell v. Ohio Family Rights, No. 1:15-CV-1757, 2016 WL 4523830, at *2 (N.D. Ohio Aug. 29, 2016); Arrow Enter. Computing Sols., Inc. v. BlueAlly, LLC, No. 5:15-CV-00037-FL, 2016 WL 4287929, at *1 (E.D.N.C. Aug. 15, 2016); Ecomission Sols., LLC v. CTS Holdings, Inc., No. MISC. 16-1793 (EGS), 2016 WL 4506974, at *1 (D.D.C. Aug. 26, 2016); Clouser v. Golden Gate Nat’l Senior Care, LLC, No. CV 3:15-33, 2016 WL 4223755, at *4 (W.D. Pa. Aug. 9, 2016); Scott Hutchinson Enters., Inc. v. Cranberry Pipeline Corp., No. 3:15-CV-13415, 2016 WL 4203555, at *2 (S.D.W. Va. Aug. 9, 2016). Several other cases cited the language as though it were still part of Rule 26(b)(1). See Fairley v. Wal-Mart Stores, Inc., No. CV 15-462, 2016 WL 4418799, at *2 (E.D. La. Aug. 19, 2016); Kuczak v. City of Trotwood, Ohio, No. 3:13-CV-101, 2016 WL 4500715, at *1 (S.D. Ohio Aug. 26, 2016); Kubik v. Cent. Michigan Univ. Bd. of Trustees, No. 15-CV-12055, 2016 WL 4425174, at *2 (E.D. Mich. Aug. 22, 2016).

FN 2 – See Fastvdo, 2016 WL 4542747, at *2 (quoting Surfvivor Media, 406 F.3d at 635); Sierra Club, 2016 WL 4528452, at *1 (quoting Brown Bag, 960 F.2d at 1470).

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Amended Rule 26(b)(1) was adopted pursuant to the Rules Enabling Act, 28 U.S.C. § 2072, et. seq. That statute provides that “[a]ll laws in conflict with such rules shall be of no further force or effect after such rules have taken effect.” Id., § 2072(b). Thus, just as a statute could effectively overrule cases applying a former legal standard, the 2015 amendment effectively abrogated cases applying a prior version of Rule 26(b)(1). The test going forward is whether evidence is “relevant to any party’s claim or defense,” not whether it is “reasonably calculated to lead to admissible evidence.”

B. Proportionality.

The 2015 amendments also added proportionality as a requirement for permissible discovery. Relevancy alone is no longer sufficient – discovery must also be proportional to the needs of the case. The Advisory Committee Note makes clear, however, that the amendment does not place the burden of proving proportionality on the party seeking discovery. The amendment “does not change the existing responsibilities of the court and the parties to consider proportionality, and the change does not place on the party seeking discovery the burden addressing all proportionality considerations.” Rule 26, Advis. Comm. Notes for 2015 Amends. Rather, “[t]he parties and the court have a collective responsibility to consider the proportionality of all discovery and consider it in resolving discovery disputes.” Id. (emphasis added)

The inquiry to be conducted under the proportionality requirement, therefore, requires input from both sides. As the Advisory Committee explained:

A party claiming undue burden or expense ordinarily has far better information – perhaps the only information – with respect to that part of the determination. A party claiming that a request is important to resolve the issues should be able to explain the ways in which the underlying information bears on the issues as that party understands them. The court’s responsibility, using all the information provided by the parties, is to consider these and all the other factors in reaching a case-specific determination of the appropriate scope of discovery. 

Id. The Court therefore will look to evidence and arguments from both sides in deciding whether discovery from the Bard foreign entities is permitted under Rule 26.

ronald-hedgesOur friend, retired Judge Ron Hedges, publicly commented on this case and said the “collective responsibility” language is vague. “If there is no allocation of burden for showing discovery is proportional, and the committee note refers to a ‘collective responsibility,’ then maybe the burden should fall on the judge, as opposed to both parties.” You probably do not want to make that comment to the judge hearing your case, but you should argue that the burden is not upon you (assuming you are opposing the discovery).

It is interesting to see how many attorneys and judges alike just do not get it. As Judge Campbell said – Old habits die hard. Also remember that the other side may be citing to cases in their discovery briefs that are no longer valid since the change of the rules. Judge Campbell makes a good point on that: “the 2015 amendment effectively abrogated cases applying a prior version of Rule 26(b)(1).” You may need to make this important point in all discovery briefs going forward. Look out for the old phrases in cases Plaintiff’s counsel cites, especially “reasonably calculated.”

It is interesting to note how harshly some judges will react when an attorney before them does not cite to the new rules. Fulton v. Livingston Fin., LLC, No. C15-0574JLR, 2016 WL 3976558 (W.D. Wash. July 25, 2016). In Fulton an attorney at a prominent firm in Seattle cited the old rule and related case law in a memorandum filed with the court pertaining to relevance. The judge called the mistake “inexcusable” and imposed harsh sanctions on the attorney, including requiring him to personally pay opposing counsel fees and costs and to provide a copy of the sanctions order and “offending briefing to senior members of Mr. Ryan’s law firm.” Ouch. 

judge_david_g-_campbellBack to In Re Bard, Judge Campbell went on to deny the discovery request under Rule 26(b)(1) primarily because the requesting party had not shown how the information sought would be of any importance to the case. Here is the operative language from pg. 6 of the opinion:

Courts generally recognize that relevancy for purposes of discovery is broader than relevancy for purposes of trial. Even still, the Court concludes that the discovery sought by Plaintiffs is only marginally relevant. With no foreign-based Plaintiffs, and mere conjecture that communications between foreign entities and foreign regulators might be inconsistent with Defendants’ communications with American regulators, the discovery appears to be only potentially relevant – more hope than likelihood.

I especially like that phrase – “more hope than likelihood.” We see so much of that from opposing counsel.

Judge Campbell went on to analyze the benefit/burden factors in 26(b)(1), some “pro” the discovery sought, and concluded the opinion with the following:

The Court concludes that the burden and expense of searching ESI from 18 foreign entities over a 13-year period outweighs the benefit of the proposed discovery – a mere possibility of finding a foreign communications inconsistent with United States communication.

Because the proposed discovery is not proportional to the needs of the case considering the factors set forth in Rule 26(b)(1), the Court concludes that Defendants need not search the ESI of foreign Bard entities for communications with foreign regulators.

Again, note his use of the phrase “a mere possibility of finding” relevant evidence. That kind of language is appropriate in many discovery disputes we now see. 

This fourth most interesting case of 2016 is one that should be in all court memorandums. It provides a persuasive, authoritative discussion of the new rules, especially scope of relevance under 26(b)(1). In re Bard IVC Filters Prods. Liab. Litig., D. Ariz., No. MDL 15-02641-PHX DGC, 2016 U.S. Dist. LEXIS 126448 (D. Ariz. Sept. 16, 2016).

 


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