Waymo v. Uber, Hide-the-Ball Ethics and the Special Master Report of December 15, 2017

December 17, 2017

The biggest civil trial of the year was delayed by U.S. District Court Judge William Alsup due to e-discovery issues that arose at the last minute. This happened in a trade-secret case by Google’s self-driving car division, WAYMO, against Uber. Waymo LLC v. Uber Techs., Inc. (Waymo I), No. 17-cv-00939-WHA (JSC), (N.D. Cal. November 28, 2017). The trial was scheduled to begin in San Francisco on December 4, 2017 (it had already been delayed once by another discovery dispute). The trial was delayed at Waymo’s request to give it time to investigate a previously undisclosed, inflammatory letter by an attorney for Richard Jacobs. Judge Alsup had just been told of the letter by the United States attorney’s office in Northern California. Judge Alsup immediately shared the letter with Waymo’s attorneys and Uber’s attorneys.

At the November 28, 2017, hearing Judge Alsup reportedly accused Uber’s lawyers of withholding this evidence, forcing him to delay the trial until Waymo’s lawyers could gather more information about the contents of the letter. NYT (11/28/17). The NY Times reported Judge Alsup as stating:

I can no longer trust the words of the lawyers for Uber in this case … You should have come clean with this long ago … If even half of what is in that letter is true, it would be an injustice for Waymo to go to trial.

NYT (11/28/17).

Judge Alsup was also reported to have said to Uber’s lawyers in the open court hearing of November 28, 2017:

You’re just making the impression that this is a total coverup … Any company that would set up such a surreptitious system is just as suspicious as can be.

CNN Tech (11/28/17).

Judge Alsup was upset by both the cover-up of the Jacobs letter and by the contents of the letter. The letter essentially alleged a wide-spread criminal conspiracy to hide and destroy evidence in all litigation, not just the Waymo case, by various means, including use of: (1) specialized communication tools that encrypt and self-destruct ephemeral communications, such as instant messages; (2) personal electronic devices and accounts not traceable to the company; and, (3) fake attorney-client privilege claims. Judge Alsup reportedly opened the hearing on the request for continuance by admonishing attorneys that counsel in future cases can be “found in malpractice” if they do not turn over evidence from such specialized tools. Fortune (12/2/17). That is a fair warning to us all. For instance, do any of your key custodians use specialized self-destruct communications tools like Wickr or Telegram?

Qualcomm Case All Over Again?

The alleged hide-the-email conduct here looks like it might be a high-tech version of the infamous Qualcomm case in San Diego. Qualcomm Inc. v. Broadcom Corp., No. 05-CV-1958-B(BLM) Doc. 593 (S.D. Cal. Aug. 6, 2007); Qualcomm, Inc. v. Broadcom Corp., 2008 WL 66932 (S.D. Cal. Jan. 7, 2008) (Plaintiff Qualcomm intentionally withheld from production several thousand important emails, a fact not revealed until cross-examination at trial of one honest witness).

The same rules of professional conduct are, or may be, involved in both Qualcomm and Waymo (citing to ABA model rules).

(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal or fail to correct a false statement of material fact or law previously made to the tribunal by the lawyer; . . .
(b) A lawyer who represents a client in an adjudicative proceeding and who knows that a person intends to engage, is engaging or has engaged in criminal or fraudulent conduct related to the proceeding shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal.

A lawyer shall not:
(a) unlawfully obstruct another party’s access to evidence or otherwise unlawfully alter, destroy, or conceal a document or other material that the lawyer knows or reasonably should know is relevant to a pending or a reasonably foreseeable proceeding; nor counsel or assist another person to do any such act.

Although, as we will see, it looks so far as if Uber and its in-house attorneys are the ones who knew about the withheld documents and destruction scheme, and not Uber’s actual counsel of record. It all gets a little fuzzy to me with all of the many law firms involved, but so far the actual counsel of record for Uber claim to have been as surprised by the letter as Waymo’s attorneys, even though the letter was directed to Uber’s in-house legal counsel.

Sarbanes-Oxley Violations?

In addition to possible ethics violations in Waymo v. Uber, a contention was made by the attorneys for Uber consultant, Richard Jacobs, that Uber was hiding evidence in violation of the Sarbanes-Oxley Act of 2002, Pub. L. 107-204, § 802, 116 Stat. 745, 800 (2002), which states in relevant part:

whoever knowingly alters, destroys, mutilates, conceals, covers up, falsifies, or makes a false entry in any record, document, or tangible object with the intent to impede, obstruct, or influence the investigation or proper administration of any matter within the jurisdiction of any department or agency of the United States or any case filed under title 11, or in relation to or contemplation of any such matter or case, shall be fined under this title, imprisoned not more than 20 years, or both.

18 U.S.C. § 1519. The Sarbanes-Oxley applies to private companies and has a broad reach not limited to litigation that has been filed, much less formal discovery requests. Section 1519 “covers conduct intended to impede any federal investigation or proceeding including one not even on the verge of commencement. Yates v. United States, – U.S. –, 135 S.Ct. 1074, 1087 (2015).

The Astonishing “Richard Jacobs Letter” by Clayton Halunen

The alleged ethical and legal violations in Waymo LLC v. Uber Techs., Inc. are based upon Uber’s failure to produce a “smoking gun” type of letter (email) and the contents of that letter. Although the letter is referred to as the Jacobs letter, it was actually written by Clayton D. Halunen of Halunen Law (shown right), an attorney for Richard Jacobs, a former Uber employee and current Uber consultant. Although this 37-page letter dated May 5, 2017 was not written by Richard Jacobs, it purports to represent how Jacobs would testify to support employment claims he was making against Uber. It was provided to Uber’s in-house employment counsel, Angella Padilla, in lieu of an interview of Jacobs that she was seeking.

A redacted copy of the letter dated May 5, 2017, has been released to the public and is very interesting for many reasons. I did not add the yellow highlighting seen in this letter and am unsure who did.

In fairness to Uber I point out that the letter states on its face in all caps that it is a RULE 408 CONFIDENTIAL COMMUNICATION FOR SETTLEMENT PURPOSES ONLY VIA EMAIL AND U.S. MAIL, a fact that does not appear to have been argued as a grounds for Uber not producing the letter to Waymo in Waymo v. Uber. That may be because Rule 408, FRCP, states that although such settlement communications are not admissible to “prove or disprove the validity or amount of a disputed claim or to impeach by a prior inconsistent statement or a contradiction” they are admissible “for another purpose, such as proving a witness’s bias or prejudice, negating a contention of undue delay, or proving an effort to obstruct a criminal investigation or prosecution.” Also, Rule 408 pertains to admissibility, not discoverability, and Rule 26(b)(1) still says that “Information within this scope of discovery need not be admissible in evidence to be discoverable.”

The letter claims that Richard Jacobs has a background in military intelligence, essentially a spy, although those portions of the letter were heavily redacted. I tend to believe this for several reasons, including the fact that I could not find a photograph of Jacobs anywhere. That is very rare. The letter goes on to describe the “unlawful activities within Uber’ s ThreatOps division.” Jacobs Letter at pg. 3. The illegal activities included fraud, theft, hacking, espionage and “knowing violations” of Sarbanes-Oxley by:

Uber’ s efforts to evade current and future discovery requests, court orders, and government investigations in violation of state and federal law as well as ethical rules governing the legal profession. Clark devised training and provided advice intended to impede, obstruct, or influence the investigation of several ongoing lawsuits against Uber and in relation to or contemplation of further matters within the jurisdiction of the United States.  …

Jacobs then became aware that Uber, primarily through Clark and Henley, had implemented a sophisticated strategy to destroy, conceal, cover up, and falsify records or documents with the intent to impede or obstruct government investigations as well as discovery obligations in pending and future litigation. Besides violating 18 U.S.C. § 15 19, this conduct constitutes an ethical violation.

Pages 5, 6 of Jacobs Letter. The practices included the alleged mandatory use of a program called WickrMe, that “programs messages to self-destruct in a matter of seconds to no longer than six days. Consequently, Uber employees cannot be compelled to produce records of their chat conversations because no record is retained.” Letter pg. 6.

Remember, Judge Alsup reportedly began the trial continuance hearing of November 28, 2017, by admonishing attorneys that in future cases they could be “found in malpractice” if they do not turn over evidence from such specialized communications tools. Fortune (12/2/17). There are a number of other secure messaging apps in adddition to Wickr that have encryption and self destruct features. A few I have found are:

There are also services on the web that will send self-destructing messages for you, such as PrivNote. This is a rapidly changing area so do your own due diligence.

Uber CEO Dara Khosrowshahi reacted to the November 29, 2017 hearing and Judge Alsup’s comments by tweeting on November 29, 2017 that Uber employees did, but no longer, use Wickr and another program like it, Telegram.

True that Wickr, Telegram were used often at Uber when I came in. As of Sept 27th I directed my teams NOT to use such Apps when discussing Uber-related business.

This seems like a good move to me on the part of Uber’s new CEO, a smart move. It is also an ethical move in a sometimes ethically challenged Silicon Valley culture. The culture is way too filled with selfish Ayn Rand devotees for my taste. I hope this leads to large scale housekeeping by Khosrowshahi. Matt Kallman, a spokesman for Uber, said after the public release of the letter:

While we haven’t substantiated all the claims in this letter — and, importantly, any related to Waymo — our new leadership has made clear that going forward we will compete honestly and fairly, on the strength of our ideas and technology.

NYT (12/15/17). You know the old saying about Fool me once …

Back to the Jacobs letter, it also alleges at pgs. 6-9 the improper use of fake attorney-client privilege to hide evidence:

Further, Clark and Henley directly instructed Jacobs to conceal documents in violation of Sarbanes-Oxley by attempting to “shroud” them with attorney-client privilege or work product protections. Clark taught the ThreatOps team that if they marked communications as “draft,” asked for a legal opinion at the beginning of an email, and simply wrote “attorney-client privilege” on documents, they would be immune from discovery.

The letter also alleges the intentional use of personal computers and accounts to conduct Uber business that they wanted to hide from disclosure. Letter pgs. 7-8.

The letter at pages 9-26 then details facts purporting to show illegal intelligence gathering activities by Uber on a global scale, violating multiple state and federal laws, including:

  • Economic Espionage Act
  • Uniform Trade Secret Act
  • California Uniform Trade Secrets Act
  • Racketeer Influenced and Corrupt Organizations Act (RICO)
  • Wire Fraud law at 18 U.S.C § 1343, and California Penal Code § 528.5
  • Wiretap Act at 18 U .S.C. § 25 10 et seq.
  • Computer Fraud and Abuse Act (CFAA)
  • Foreign Corrupt Practices Act (FCPA)

Special Master John L. Cooper

Judge Alsup referred the discovery issues raised by Uber’s non-disclosure of the “Jacobs Letter” to the Special Master handling many of the discovery disputes in this case, John L. Cooper of Farella Braun + Martel LLP. The Special Master Report with Cooper’s recommendations concerning the issues raised by the late disclosure of the letter is dated December 15, 2017. Cooper’s report is a public record that can be found here. This is  his excellent introduction of the dispute found at pages 1-2 of his report.

The trial of this trade secrets case was continued for a second time after the belated discovery of inflammatory communications by a former Uber employee came to light outside the normal discovery process. On April 14, 2017, Richard Jacobs sent a resignation e-mail to Uber’s then-CEO and then-general counsel, among others, accusing Uber of having a dedicated division with a “mission” to “steal trade secrets in a series of code-named campaigns” and engaging in other allegedly wrongful or inappropriate conduct. A few weeks later, on May 5, 2017, Mr. Jacobs’ lawyer, Clayton Halunen, sent a letter to Angela Padilla, Uber’s Vice President and Deputy General Counsel for Litigation and Employment. That 37-page letter expanded in some  detail on Mr. Jacobs’ e-mailed accusations regarding clandestine and concerted efforts to steal competitors’ trade secrets, including those belonging to Waymo. It also addressed allegations touching on Anthony Levandowski’s alleged downloading of Waymo trade secrets. The Jacobs Letter laid out what his lawyer described as a set of hardware and software programs, and usage protocols that would help Uber to allegedly carry out its thefts and other corporate espionage in secret and with minimized risk of evidence remaining on Uber servers or devices. By mid-August Mr. Jacobs and Uber settled their disputes and executed a written settlement agreement on August 14-15,2017.

Despite extensive discovery and multiple Court orders to produce an extensive amount of information related to the accusations in the Jacobs Materials, Waymo did not learn of their existence until after November 22, when the Court notified the parties that a federal prosecutor wrote a letter to this Court disclosing the gist of the Jacobs allegations.

The Special Master’s report then goes on to analyze whether Uber was obligated to produce the Jacobs Materials in response to any of the Court’s prior orders or Waymo’s discovery requests. In short, Master Cooper concluded that they were not directly covered by any of the prior court orders, but the Jacobs Letter was responsive to certain discovery requests propounded by Waymo, and Uber was obligated to produce it in response to those requests.

Special Master Cooper goes on to describe at page 7 of his report the Jacobs letter by Halunen. To state the obvious, this is clearly a “hot” document with implications that go well beyond this particular case.

That 37-page letter set forth multiple allegations relating to alleged efforts by Uber individuals and divisions. Among other things, the letter alleges that Uber planned to use certain hardware devices and software to conceal the creation and destruction of corporate records that, as a result, “would never be subject to legal discovery.” See ECF No. 2307-2 at 7. These activities, Mr. Jacobs’ lawyer asserted, “implicate ongoing discovery disputes, such as those in Uber’s litigation with Waymo.” Id. at 9. He continued:

Specifically, Jacobs recalls that Jake Nocon, Nick Gicinto, and Ed Russo went to Pittsburgh, Pennsylvania to educate Uber’s Autonomous Vehicle Group on using the above practices with the specific intent of preventing Uber’s unlawful schemes from seeing the light of day.

Jacobs’ observations cast doubt on Uber’s representation in court proceedings that no documents evidencing wrongdoing can be found on Uber’s systems and that other communications are actually shielded by the attorney-client privilege. Aarian Marshall, Judge in Waymo Dispute Lets Uber’s Self-driving Program Live—for Now, wired.com (May 3, 2017 at 8:47p.m.) (“Lawyers for Waymo also said Uber had blocked the release of 3,500 documents related to the acquisition of Otto on the grounds that they contain privileged information …. Waymo also can’t quite pin down whether Uber employees saw the stolen documents or if those documents moved anywhere beyond the computer Levandowski allegedly used to steal them. (Uber lawyers say extensive searches of their company’s system for anything connected to the secrets comes up nil.)”), available at (citation omitted).

Id. at 9-10.

Uber Attorney Angela Padilla

Angella Padilla was Uber’s Vice President and Deputy General Counsel for Litigation and Employment. She testified on these issues. Here is Special Master Cooper’s summary at pages 8-9 of his report:

Ms. Padilla testified in this Court that she read the letter “in brief’ and turned it over to other Uber attorneys, including Ms. Yoo, to begin an internal investigation. Nov. 29, 2017 Hr’g Tr. at 15:17-24. The letter also made its way to two separate committees of Uber’s Board of Directors, including the committee that was or is overseeing special litigation, including this case and the Jacobs matter. Id. at 20:10-13; 26:23-25. On June 27, Uber disclosed the allegations in the Jacobs Letter to the U.S. Attorney for the Northern District of California. Id. at 27:20-14. It disclosed the Jacobs Letter itself on or around September 12 to the same U.S. Attorney’s Office, to another U.S. Attorney, in the Southern District of New York, and to the U.S. Department of Justice in Washington. Id. at 28:4-10. Ms. Padilla testified that Uber made these disclosures to multiple prosecutors “to take the air out of [Jacobs’] extortionist balloon.” Id. at 28:18-19. Nearly one month before that distribution of the letter to federal prosecutors, on August 14, Uber settled with Mr. Jacobs—the terms of which included $4.5 million in compensation to Jacobs and $3 million to his lawyers. See id. at 62:6-63-12.

I have to pause here for a minute because the settlement amount takes my breath away. Not only the payment of $4.5 Million to Richard Jacobs who had a salary of $130,000 per year, but also the additional payment of $3.0 million dollars to his lawyers. That’s an incredible sum for writing a couple of letters, although I am sure they would claim to have put much more into their representation than meets the eye.

Other Attorneys for Uber Involved

Back to Special Master Cooper’s summary of the testimony of Uber attorney Padilla and other facts in the record about attorney knowledge of the “smoking gun” Jacobs letter (footnotes omitted):

Uber distributed the Jacobs E-Mail to two of Uber’s counsel of record at Morrison Foerster (“MoFo”) in this case. See Dec. 4, 2017 Hr’g Tr. at 46:1-47:5. Other MoFo attorneys directly involved in this case and related discovery issues e-mailed with other MoFo attorneys in late April about “Uber’s ediscovery systems regarding potential investigation into Jacobs resignation letter.” See Waymo Ex. 21.

None of the Uber outside counsel working on this case got a copy of the Jacobs Letter. Neither did the two Uber in-house lawyers who were or are handling this case; Ms. Padilla testified that she did not send it to them. Nov. 29, 2017 Hr’g Tr. at 47:8-16. By late June, some attorneys from Boies Schiller and Flexner, also counsel in this matter for Uber, had discussions with other outside counsel and Ms. Padilla about issues arising from the internal investigation triggered by the Jacobs Materials. See Waymo Ex. 20, Entries 22-22(h).

So now you know the names of the attorneys involved, and not involved, according to Special Master Cooper at page 9 of his report. Apparently none of the actual counsel of record knew about it. I would have to assume, and I think the court will too, that this was intentional. It was so clever as to be obvious, or, as the British would say too clever by half.

U.S. Attorney Notifies Judge Alsup of the Jacobs Letter

To complete the procedural background, here is what happened next leading to the referral to the Special Master. Note that a U.S. Attorney taking action like this to notify a District Court Judge of a piece of evidence is extraordinary, especially to do so just before a trial. Judge Alsup said that he had never had such a thing happen in his courtroom. The U.S. Attorney for the Northern District of California is Brian Stretch. Obviously he was concerned about the fairness of Uber’s actions. In my opinion this was a good call by Stretch.

On November 22, 2017, the U.S. Attorney for the Northern District of California notified this Court of the Jacobs allegations and specifically referenced the account Jacobs put in his letter about the efforts to keep the Ottomotto acquisition secret. See ECF No. 2383. The Court on the same day issued an order disclosing receipt of the letter from the U.S. Attorney and asked the parties to inform the Court about the extent of any prior disclosure of the Jacobs allegations. See ECF Nos. 2260-2261. After continuing the trial date in light of the parties’ responses to that query, the Court on December 4, 2017, ordered the Special Master “to determine whether and to what extent, including the history of this action and both sides’ past conduct, defendants were required to earlier produce the Jacobs letter, resignation email, or settlement agreement, or required to provide any information in those documents in response to interrogatories, Court orders, or other agreements among counsel.” ECF No. 2334, 2341.

Special Master report at pgs. 9-10.

Special Master Cooper’s Recommended Ruling

Master Cooper found that the Richard Jacobs letter was responsive to two of Waymos’ requests to produce: RFP 29 and RFP 73. He rejected Uber’s argument that they were not responsive to any request, an argument that must have been difficult to make concerning a document this hot. They tried to make the argument seem more reasonable by saying that even if the letter was “generally relevant,” it was not responsive. Then they cite to cases standing for the proposition that you have no duty to produce relevant documents that you are not going to rely on, namely documents adverse to your position, unless they are specifically requested. Here is a quote of the conclusion of that argument from page 16 of Uber’s Response to Waymo’s Submission to Special Master Cooper Re the Jacobs Documents.

Congress has specified in Rule 26(a)(ii) what documents must be unilaterally produced, and they are only those that a party “may use to support its claims or defenses.” Thus, a party cannot use a document against an adversary at trial that the party failed to disclose. However, Rule 26 very pointedly does not require the production of any documents other than those that a party plans to use “to support” its claims. Obviously, Uber is not seeking to use any of the documents at issue to support its claims. If Waymo believes that this rule should be changed, that is an issue they need to address with Congress, not with the Court.

Master Cooper did not address that argument because he found the documents were in fact both relevant and directly responsive to two of Waymo’s requests for production.

Uber’s attorney also made what I consider a novel argument that even if the Jacobs letter was found to be responsive, they still did have to produce it because, get this – it did not include any of the keywords that they agreed to use to search for documents in those categories. Incredible. What difference does that make, if they knew about the document anyway? Their client, Uber, specifically including in-house counsel, Ms. Padilla, clearly knew about it. The letter was to her. Are they suggesting that Uber did not know about the letter because some of their outside counsel did not know about it? Special Master Cooper must have had the same reaction as he disposed of this argument in short order at page 17 of his report:

Uber argues, that in some scenarios, reliance on search terms is enough to satisfy a party’s obligation to find responsive documents. See, e.g., T.D.P. v. City of Oakland, No, 16-cv-04132-LB, 2017 WL 3026925, at *5 (N.D. Cal. July 17, 2017) (finding certain search terms adequate for needs of case). But I find there are two main reasons why an exclusive focus on the use of search terms is inappropriate for determining whether the Jacobs Letter should have been produced in response to RFP 29 and RFP 73.

First, the parties never reached an agreement to limit their obligation to searching for documents to only those documents that hit on agreed-upon search terms. See Waymo Ex. 5 (Uber counsel telling Waymo during search-term negotiations that “Waymo has an obligation to conduct a reasonable search for responsive documents separate and apart from any search term negotiations”). (Emphasis added)

Second, Uber needed no such help in finding the Jacobs Materials. They were not stowed away in a large volume of data on some server. They were not stashed in some low-level employee’s files. Parties agree to use search terms and to look into the records of the most likely relevant custodians to help manage the often unwieldy process of searching through massive amounts of data. These methods are particularly called for when a party, instead of merely having to look for a needle in a haystack, faces the prospect of having to look for lots of needles in lots of haystacks. This needle was in Uber’s hands the whole time.

I would add that this needle was stuck deep into their hands, such that they were bleeding profusely. Maybe the outside attorneys did not see it, but Uber sure did and they had a duty to advise their attorneys. Uber’s attorneys would have been better off saving their powder for attacking the accuracy of the contents of the Jacobs letter and talking about the fast pace of discovery. They did that, but only as a short concluding argument, almost an afterthought. See page 16-19 of Uber’s Response to Waymo’s Submission to Special Master Cooper Re the Jacobs Documents.

Here is another theoretical argument that Uber’s lawyers threw up and Cooper’s practical response at pages 17-18 of his report:

Uber argues that it cannot be that the mere possession and knowledge of a relevant document must trigger a duty to scrutinize it and see if it matches any discovery requests. It asked at the December 12, 2017, hearing before the Special Master: Should every client be forced to instruct every one of its employees to turn over every e-mail and document to satisfy its discovery obligations to produce relevant and responsive documents? Must every head of litigation for every company regularly confronted with discovery obligations search their files for responsive documents, notwithstanding any prior agreement with the requesting party to search for responsive documents by the use of search terms?

It is not easy, in the abstract, to determine where the line regarding the scope of discovery search should be drawn. But this is not a case involving mere possession of some document. The facts in this case suggest that Ms. Padilla knew of the Jacobs Letter at the time Uber had to respond to discovery requests calling for its production—it certainly was “reasonably accessible.” Mr. Jacobs’ correspondence alleged systemic, institutionalized, and criminal efforts by Uber to conceal evidence and steal trade secrets, and not just as a general matter but also specifically involving the evidence and trade secrets at issue in this case—maybe the largest and most significant lawsuit Uber has ever faced. Ms. Padilla, Uber’s vice president and deputy general counsel for litigation and employment received the Jacobs Materials around the same time that discovery in this case was picking up and around the same time that the Court partially granted Waymo’s requested provisional relief. Shortly after that, Uber told federal prosecutors about the Jacobs allegations and then later sent them a copy of the letter. It sent the materials to outside counsel, including lawyers at MoFo that Uber hired to investigate the allegations. Two separate Uber board committees got involved, including the committee overseeing this case. Uber paid Mr. Jacobs $4.5 million, and his lawyer $3 million, to settle his claims.

The Federal Rules obligate a party to produce known, relevant and reasonably accessible material that on its face is likely to be responsive to discovery requests. RFP 29 and RFP 73 were served on Uber on May 9, just a few days after Ms. Padilla received the Jacobs Letter on May 5. Uber was therefore obligated to conduct a reasonable inquiry into those requests (and all others it received) to see if it had documents responsive to those requests and produce non-privileged responsive documents.

Special Master John Cooper concluded by finding that the “Jacobs letter was responsive to Waymo’s Request for Production No. 29 and Request for Production No. 73, and Uber should have produced it to Waymo in response to those requests.” It was beyond the scope of his assignment as Special Master to determine the appropriate remedy. Uber will now probably challenge this report and Judge William Alsup will rule.

Like everyone else, I expect Judge Alsup will agree with Cooper’s report. The real question is what remedy will he provide to Waymo and what sanctions, if any, will Judge Alsuop impose.


At the hearing on the request for a trial delay on November 28, 2017, Judge William Alsup reportedly told Uber’s in-house attorney, Angella Padilla:

Maybe you’re in trouble … This document should have been produced … You wanted this case to go to trial so that they didn’t have the document, then it turns out the U.S. attorney did an unusual thing. Maybe the guy [Jacobs] is a disgruntled employee but that’s not your decision to make, that’s the jury’s.

The Recorder (November 29, 2017).

In response to Angella Padilla saying that Jacobs was just a “extortionist” and the allegations in his letter were untrue. Judge Alsup reportedly responded by saying:

Here’s the way it looks … You said it was a fantastic BS letter with no merit and yet you paid $4.5 million. To someone like me and people out there, mortals, that’s a lot of money, that’s a lot of money. And people don’t pay that kind of money for BS and you certainly don’t hire them as consultant if you think everything they’ve got to contribute is BS. On the surface it looks like you covered this up.

The Recorder (November 29, 2017).

Judge William Alsup is one of the finest judges on the federal bench today. He is a man of unquestioned integrity and intellectual acumen. He is a Harvard Law graduate, class of 1971, and former Law clerk for Justice William O. Douglas, Supreme Court of the United States, 1971-1972.  How Judge Alsup reacts to the facts in Waymo LLC v. Uber Techs., Inc. now that he has the report of Special Master Cooper will likely have a profound impact on e-discovery and legal ethics for years to come.

No matter what actions Judge Alsup takes next, the actions of Uber and its attorneys in this case will be discussed for many years to come. Did the attorneys’ non-disclosure violate Rule of Professional Conduct 3.3, Candor Toward the Tribunal? Did they violate Rule 3.4, Fairness to Opposing Party and Counsel? Also, what about Rule 26(g) Federal Rules of Civil Procedure? Other rules of ethics and procedure? Did Uber’s actions violate the Sarbanes-Oxley Act? Other laws? Was it fraud?

Finally, and these are critical questions, did Uber breach their duty to preserve evidence when they knew that litigation was reasonably likely? Did their attorneys do so if they knew of these practices? What sanctions are appropriate for destruction of evidence under Rule 37(e) and the Court’s inherent authority? Should an adverse inference be imposed? A default judgment?

The preservation related issues are big questions that I suspect Judge Alsup will now address. These issues and his rulings, and that of other judges who will likely face the same issues soon in other cases, will impact many corporations, not just Uber. The use of software such as Wickr and Telegram is apparently already wide-spread. In what circumstances and for what types of communications may the use of such technologies place a company (or individual) at risk for severe sanctions in later litigation? Personally, I oppose intentionally ephemeral devices, where all information self-destructs, but, at the same time, I strongly support the right of encryption and privacy. It is a question of balance between openness and truth on the one hand, and privacy and security on the other. How attorneys and judges respond to these competing challenges will impact the quality of justice and life in America for many years to come.


Another TAR Course Update and a Mea Culpa for the Negative Consequences of ‘Da SIlva Moore’

June 4, 2017

We lengthened the TAR Course again by adding a video focusing on the three iterated steps in the eight-step workflow of predictive coding. Those are steps four, five and six: Training Select, AI Document Ranking, and Multimodal Review. Here is the new video introducing these steps. It is divided into two parts.

This video was added to the thirteenth class of the TAR Course. It has sixteen classes altogether, which we continue to update and announce on this blog. There were also multiple revisions to the text in this class.

Unintended Negative Consequences of Da Silva Moore

Predictive coding methods have come a long way since Judge Peck first approved predictive coding in our Da Silva Moore case. The method Brett Anders and I used back then, including disclosure of irrelevant documents in the seed set, was primarily derived from the vendor whose software we used, Recommind, and from Judge Peck himself. We had a good intellectual understanding, but it was the first use for all of us, except the vendor. I had never done a predictive coding review before, nor, for that matter, had Judge Peck. As far as I know Judge Peck still has not ever actually used predictive coding software to do document review, although you would be hard pressed to find anyone else in the world with a better intellectual grasp of the issues.

I call the methods we used in Da Silva Moore Predictive Coding 1.0. See: Predictive Coding 3.0 (October 2015) (explaining the history of predictive coding methods). Now, more than five years later, my team is on version 4.0. That is what we teach in the TAR Course. What surprises me is that the rest of the profession is still stuck in our first method, our first ideas of how to best use the awesome power of active machine learning.

This failure to move on past the Predictive Coding 1.0 methods of Da Silva Moore, is, I suspect, one of the major reasons that predictive coding has never really caught on. In fact, the most successful document review software developers since 2012 have ignored predictive coding altogether.

Mea Culpa

Looking back now at the 1.0 methods we used in Da Silva I cannot help but cringe. It is truly unfortunate that the rest of the legal profession still uses these methods. The free TAR Course is my attempt to make amends, to help the profession move on from the old methods. Mea Culpa.

In my presentation in Manhattan last month I humorously quipped that my claim to fame, Da Silva Moore, was also my claim to shame. We never intended for the methods in Da Silva Moore to be the last word. It was the first word, writ large, to be sure, but in pencil, not stone. It was like a billboard that was supposed to change, but never did. Who knew what we did back in 2012 would have such unintended negative consequences?

In Da Silva Moore we all considered the method of usage of machine learning that we came up with as something of an experiment. That is what happens when you are the first at anything. We assumed that the methods we came up with would quickly mature and evolve in other cases. They certainly did for us. Yet, the profession has mostly been silent about methods since the first version 1.0 was explained. (I could not take part in these early explanations by other “experts” as the case was ongoing and I was necessarily silenced from all public comment about it.) From what I have been told by a variety of sources many, perhaps even most attorneys and vendors are using the same methods that we used back in 2012. No wonder predictive coding has not caught on like it should. Again, sorry about that.

Why the Silence?

Still, it is hardly all my fault. I have been shouting about methods ever since 2012, even if I was muzzled from talking about Da Silva Moore. Why is no one else talking about the evolution of predictive coding methods? Why is mine the only TAR Course?

There is some discussion of methods going on, to be sure, but most of it is rehashed, or so high-level and intellectual as to be superficial and worthless. The discussions and analysis do not really go into the nitty-gritty of what to do. Why are we not talking about the subtleties of the “Stop decision?” About the in and outs of document training selection. About the respective merits of CAL versus IST? I would welcome dialogue on this with other practicing attorneys or vendor consultants. Instead, all I hear is silence and old issues.

The biggest topic still seems to be the old one of whether to filter documents with keywords before beginning machine training. That is a big, no duh, don’t do it, unless lack of money or some other circumstance forces you to, or unless the filtering is incidental and minor to cull out obvious irrelevant. See eg: Stephanie Serhan, Calling an End to Culling: Predictive Coding and the New Federal Rules of Civil Procedure, 23 Rich. J.L. & Tech. 5 (2016). Referring to the 2015 Rule Amendments, Serhan, a law student, concludes:

Considering these amendments, predictive coding should be applied at the outset on the entire universe of documents in a case. The reason is that it is far more accurate, and is not more costly or time-consuming, especially when the parties collaborate at the outset.

Also see eg, William Webber’s analysis of the Biomet case where this kind of keyword filtering was used before predictive coding began. What is the maximum recall in re Biomet?Evaluating e-Discovery (4/24/13). Webber, an information scientist, showed back in 2013 that when keyword filtering was used in the Biomet case, it filtered out over 40% of the relevant documents. This doomed the second filter predictive coding review to a maximum possible recall of 60%, even if it was perfect, meaning it would otherwise have attained 100% recall, which (almost) never happens. I have never seen a cogent rebuttal of this analysis; again, aside from proportionality, cost arguments.

There was discussion for a while on another important, yet sort of no-brainer issue, whether to keep on machine training or not, which Grossman and Cormack called Continuous Active Learning (CAL).  We did not do that in Da Silva Moore, but we were using predictive Coding 1.0 as explained by our vendor. We have known better than that now for years. In fact, later in 2012, during my two public ENRON document review experiments with predictive coding I did not follow the two-step procedure of version 1.0. Instead, I just kept on training until I could not find any more relevant documents. A Modest Contribution to the Science of Search: Report and Analysis of Inconsistent Classifications in Two Predictive Coding Reviews of 699,082 Enron Documents. (Part One); Comparative Efficacy of Two Predictive Coding Reviews of 699,082 Enron Documents(Part Two); Predictive Coding Narrative: Searching for Relevance in the Ashes of Enron (in PDF form and the blog introducing this 82-page narrative, with second blog regarding an update); Borg Challenge: Report of my experimental review of 699,082 Enron documents using a semi-automated monomodal methodology (a five-part written and video series comparing two different kinds of predictive coding search methods).

Of course you keep training. I have never heard any viable argument to the contrary. Train then review, which is the protocol in Da Silva Moore, was the wrong way to do it. Clear and simple. The right way to do machine training is to  keep training until you are done with the review. This is the main thing that separates Predictive Coding 1.0 from 2.0. See: Predictive Coding 3.0 (October 2015). I switched to version 2.0 right after Da Silva Moore in late 2012 and started using continuous on my own initiative. It seemed obvious once I had some experience under my belt.  Still, I do credit Maura Grossman and Gordon Cormack with the terminology and scientific proof of the effectiveness of CAL, a term which they have now trademarked for some reason.  They have made important contributions to methods and are tireless educators of the profession. But where are the other voices? Where are the lawyers?

The Grossman and Cormack efforts are scientific and professorial. To me this is just work. This is what I do as a lawyer to make a living. This is what I do to help other lawyers find the key documents they need in a case. So I necessarily focus on the details of how to actually do active machine learning. I focus on the methods, the work-flow. Aside from the Professors Cormack and Grossman, and myself, almost no one else is talking about predictive coding methods. Lawyers mostly just do what the vendors recommend, like I did back in Da Silva Moore days. Yet almost all of the vendors are stagnant. (The new KrolLDiscovery and Catalyst are two exceptions, and even the former still has some promised software revisions to make.)

From what I have seen of the secret sauce that leaks out in predictive coding software demos of most vendors, they are stuck in the old version 1.0 methods. They know nothing, for instance, of the nuances of double-loop learning taught in the TAR Course. The vendors are instead still using the archaic methods that I thought were good back in 2012. I call these methods Predictive Coding 1.0 an 2.0. See: Predictive Coding 3.0 (October 2015).

In addition to continuous training, or not, most of those methods still use nonsensical random control sets that ignore concept drift, a fact of life in every large review project. Id. Moreover, the statistical analysis in 1.0 and 2.0 that they use for recall does not survive close scrutiny. Most vendors routinely ignore the impact of Confidence Intervals on range and the impact on low prevalence data-sets. They do not even mention binomial calculations designed to deal with low prevalence. Id. Also See: ZeroErrorNumerics.com.


The e-Discovery Team will keep on writing and teaching, satisfied that at least some of the other leaders in the field are doing essentially the same thing. You know who you are. We hope that someday others will experiment with the newer methods. The purpose of the TAR Course is to provide the information and knowledge needed to try these methods. If you have tried predictive coding before, and did not like it, we hear you. We agree. I would not like it either if I still had to use the antiquated methods of Da Silva Moore.

We try to make amends for the unintended consequences of Da SIlva Moore by offering this TAR Course. Predictive coding really is breakthrough technology, but only if used correctly. Come back and give it another try, but this time use the latest methods of Predictive Coding 4.0.

Machine learning is based on science, but the actual operation is an art and craft. So few writers in the industry seem to understand that. Perhaps that is because they are not hands-on. They do not step-in. (Stepping-In is discussed in Davenport and Kirby, Only Humans Need Apply, and by Dean Gonsowski, A Clear View or a Short Distance? AI and the Legal Industry, and A Changing World: Ralph Losey on “Stepping In” for e-Discovery. Also see: Losey, Lawyers’ Job Security in a Near Future World of AI, Part Two.) Even most vendor experts have never actually done a document review project of their own. And the software engineers, well, forget about it. They know very little about the law (and what they think they know is often wrong) and very little about what really goes on in a document review project.

Knowledge of the best methods for machine learning, for AI, does not come from thinking and analysis. It comes from doing, from practice, from trial and error. This is something all lawyers understand because most difficult tasks in the profession are like that.

The legal profession needs to stop taking legal advice from vendors on how to do AI-enhanced document review. Vendors are not supposed to be giving legal advice anyway. They should stick to what they do best, creating software, and leave it to lawyers to determine how to best use the tools they make.

My message to lawyers is to get on board the TAR train. Even though Da Silva Moore blew the train whistle long ago, the train is still in the station. The tracks ahead are clear of all legal obstacles. The hype and easy money phase has passed. The AI review train is about to get moving in earnest. Try out predictive coding, but by all means use the latest methods. Take the TAR Course on Predictive Coding 4.0 and insist that your vendor adjust their software so you can do it that way.

e-Disco News, Knowledge and Humor: What’s Happening Today and Likely to Happen Tomorrow

June 7, 2015

Spock_smilingMy monthly blogs seems to be getting too heavy, even for me, so this month I am going to try to change. This month I will resort to e-discovery gossip and cheap laughs. I’m hoping that even Spock himself would smile.

But first, a little introspective musing. In February this year, after nine years of writing a weekly blog, I switched to monthly. Since then my blogs have not only been long, complex and difficult, which I warned you would happen, but have also been a tad serious and intellectual. That was never my intent, but it just turned out that way. For instance, my first monthly blog in March, where I started harmlessly enough with a fantasy about time travel and a hack of the NSA, the blog morphed into a detailed outline and slide show on how to do a predictive coding project. Heavy, some might even say boring, well, at least the second half. My next blog was my all time deepest writing ever, where I explained my new intellectual paradigm, Information → Knowledge → Wisdom. I really do hope as many people as possible will read this. It is intended to be insightful, not necessarily entertaining, and certainly not light reading. It went beyond just e-discovery, and law, and ventured into general social commentary.

ZENumericsIn last month’s blog I shared a moment of ZEN, but the moment was filled with math and metrics, not bliss. That’s because in my bizarro world ZEN now means Zero Error Numerics and is designed for quality control in legal search and document review, not Enlightenment. The focus in that blog was on seventeen skills that must be learned to master the ZEN of document review, including concentration. If it were not bad enough to share deep knowledge, instead of fun facts, I even included links to wisdom words with quotes of Zen Masters, old and new. I also mentioned the new trend in corporate America, especially Silicon Valley, of meditation and mindfulness. That was a heavy blog indeed, even the name was way long: Introducing a New Website, a New Legal Service, and a New Way of Life / Work; Plus a Postscript on Software Visualization and Thanks to Kroll Ontrack.

zen_garden_kyotoThe response from most of you, my dear readers, to last month’s blog reminded me of the sound of one hand clapping, or, as I will explain latter, the pauses after Craig Ball’s jokes at his keynote in London last month. Still, last month’s blog did at least provoke an enthusiastic response from all Krollites. I have to concede, however, that this could be a result of my mention and sincere thanks to Kroll Ontrack in the Postscript to Data Visualization at the end of the blog, rather than any great fascination on Kroll’s part with ZEN. Still, I may go with KO next year to teach predictive coding in Tokyo, and even visit Kyoto, so their interest in stages beyond mere information may well be sincere. See: Information → Knowledge → Wisdom: Progression of Society in the Age of Computers.

This month, with my goal to amuse and make even Spock smile, my blog will focus on information, name dropping and insider references. Some knowledge will be thrown in too, of course, because, after all, that is the whole point of information. Information is never an end in itself, or at least should not be. A dash of wisdom may also be thrown in, but, I promise, I will wrap it in humor and sneak it by with vague allusions. No more Zen Master quotes, not even Steve Jobs. Hopefully you will not even notice the wise guy comments, and may even suspect, falsely of course, that you are none the wiser for reading all this bull.

LTN Finalist for Innovative CIO of the Year

ralphlosey_cartoon_smallI will start this newsy blog off on a personal note about my surprise nomination for an honest to God award. No. It has nothing to do with ZEN or document review competitions (ahem – never did get an award for that). It has to do with innovation. Me and new ideas. Imagine that. Unlike former government guru award laden Jason R. Baron, now IG champion of the World after his recent trashing of me in London, I have never won an award (I don’t count my third grade spelling bee) (imagine very small violins playing now). I still have not won an award, mind you, but I have at least now been nominated and qualified as one of three finalists in the Legaltech News Innovation Award 2015. For losers like me just getting a third place mention is a big deal. Sad huh? The award is supposed to recognize “outstanding achievement by legal professionals in their use of technology.”


Thank you dear readers for nominating and voting for me to receive this award. The award category I am in is a bit odd (for me at least), Chief Information Officer, but apparently that is the only one that someone like me could be crammed into. The three finalists in each Innovation category are determined by open voting by LTN magazine subscribers and through LTN’s website. So again, thanks for all of you who voted, especially my family and paid voters in Eastern Europe (they work cheap). The final winner among the finalists in each category are, according to LTN, chosen by “a panel of judges comprised of members of Legaltech News’ editorial staff.” Uh-oh.

Congratulations to all who made it as a finalists and good luck to one and all. There were many vendor categories too, aside from the law firm ones listed in the chart. I list all the vendor categories and finalists below. I have heard of most of them, and know a few very well. But to be honest, I had never heard of many of these vendors, which, no doubt, is what most law firm CIOs are now saying about me. This is an informative list, so I suggest you take time to read it. Again, congrats to all finalists.

Vendor Finalists/Winners

New Product of the Year
Avvo Inc., Advisor
Catalyst Repository Systems, Predict
Diligence Engine
Lex Machina
Best Marketing Services Providers
JD Supra
Best Knowledge Management Software
Motivation Group’s Easy Data Maps
MDLegalApps’ Not Guilty App
ZL Technologies
Best Mobile Device Tool or Service
Abacus Data Systems
Logik Systems’ Logikcull
Best Trial Support Software
Indata Corp.’s TrialDirector
LexisNexis CaseMap
Thomson Reuters’ Case Notebook
Best Case/Matter Management System
Bridgeway Software
Mitratech Holdings’ TeamConnect 4
Best Records Management Software
Hewlett-Packard Co., HP Records Manager (formerly TRIM)
IBM Records Manager
ZL Technologies
Best Risk Management Software
Compliance Science Inc.
IBM OpenPages Operational Risk Management
Best Time and Billing Software
Abacus Data Systems
Tabs3 Software
Tikit North America
Best Collaboration Tool
Accellion kiteworks
Litera IDS
Mitratech’s Lawtrac Self-Service Portal
Opus2 Magnum
Best Document Automation/Management
HotDocs Market
Leaflet Corp.
Best E-Discovery Managed Service Provider
Clutch Group
FTI Consulting, FTI Technology
Iris Data Services’ Arc
Best E-Discovery Processing
Exterro Inc.
iPro Tech
ZL Technologies
Best E-Discovery Review Platform
FTI Technology’s Ringtail software
iConect Developement
kCura Corp.’s Relativity
Recommind Inc.’s Axcelerate 5
Best E-Discovery Legal Hold
Exterro Legal Hold
Legal Hold Pro
Best E-Discovery Hosting Provider
Iris Data Services
Nextpoint Inc.
Best E-Discovery OEM Technology Partner
Content Analyst
Best Research Product
Docket Alarm Inc.
Handshake Corp.
Best Research Platform
Bloomberg Law
LexisNexis’ Lexis Advance
Thomson Reuters’ Westlaw Next
Best Practice Management Software
LexisNexis Legal & Professional’s Firm Manager
Thomson Reuters’ Firm Central

The other two finalists in “my” category, CIO (if hell freezes over and I win, you know I’ll add that title to my card), are Dan Nottke and Harry Shipley. Again, good luck to them and please excuse my pathetic attempts at humor. I Googled them both and will share what I know about them and then make a prediction as to how I will do in this event (hint – it’s not good).

Nottke_danDan Nottke is currently the Chief Information Officer for Kirkland & Ellis LLP, a law firm that always seems to begin descriptions of itself by saying it is 100-years old. (In just a few more years I may be able to say that too.) Most of us know Kirkland, not as old, but as one of the largest, most powerful law firms, having over 1,800 lawyers in key cities around the world. The IT challenges of a firm like that must be huge. Dan is obviously a serious player in the law firm CIO world.

I have never met Dan, but a quick Google shows he is on LTN’s Law Firm Chief Information & Technology Officers Board. With the exception of Monica Bay, who has now left LTN and this CIO Board, I have never met, or even heard of, any of the LTN CIO board members. They all appear to be great people, we just do not travel in the same circles. They are, after all, real life law firm CIOs. They are engineers, not lawyers, but for lawyers. Googling Dan shows that he is usually described with the following defining accomplishment:

Since joining the Firm in 2008, Dan has led the transformation of the Information Technology department from a decentralized team to a fully centralized Information Technology Infrastructure Library (ITIL) based on a high performing organization.

Since his expertise is so different from mine (to be honest I had to look up ITIL on Wikipedia, since I had never heard of it), it is no surprise that we have never met. About the only thing we have in common is high performing law firms, although his firm is more than twice the size of mine. The same goes for the other finalist, Harry Shipley. He has yet another completely different skill set and list of accomplishments.

Harry Shipley is the Assistant Executive Director and CFO of the Iowa State Bar Association. According to his Linked-In profile he is a graduate of Grand View College and the top skill listed is legal research, but otherwise he does not disclose much. Further research shows that he is an expert in document automation, an area he has been working on for over 15 years. I also see that Harry received an award last year from the Iowa State Bar Association in 2014, the Patriot Award, in recognition of his support of Iowa Bar employees serving in the National Guard and Reserve. Seems like a very nice guy, but I could not find out much more about him. Obviously he has many LTN fans or he would not have made the finals.

If I were the LTN Editors and had to pick a winner from these three for the most Innovative CIO of the year, I would pick Dan Nottke (no offense Harry). After all, Dan is the only real life CIO, and taking a “decentralized team to a fully centralized Information Technology Infrastructure Library” seems pretty innovative to me. But, what do I know, I’m just a lawyer, which appears to be the only advantage I have at this point over Dan and Harry. So, congratulations in advance to Mr. Nottke. In the very unlikely event that Harry or I win instead, Dan can at least console himself in knowing that the most Innovative CIO this year did not go to a competitor CIO, it went to a Bar guy or hacker lawyer instead.

LTN-innovation-awardsThe Legaltech News announcement of the award finalists said: “The winners will be recognized at a special event on July 14 at the close of Legaltech West at the City Club of San Francisco.” Well, I never go to Legaltech West, just East. So, even if I did not already have another very important conflict, flying from Orlando to San Francisco is a tad too far to travel for a maybe award dinner. So, Dan, please do not be insulted if I do not show to applaud your acceptance. I admit I did ask Legaltech about any possible advance notice, and they said no way, come to the dinner to find out just like everyone else (I respect that, but had to try). Apparently, this is the first time LTN has ever had an awards dinner for this with all the super-secrecy stuff. (I understand they used to just make an announcement in LTN and mail you something.) But now they have a dinner and are looking for a good turn-out. I don’t blame them for that, having put on a few events myself during my nearly 100 years.

Oscar_AwardAnyway, LTN told me that I had to be there, at the awards dinner, in order to physically receive the award (not sure exactly that means). So, even though I cannot come due to the long distance, and an expected very big and important conflict, namely my playing a new role of Grandfather at about that time, my firm, Jackson Lewis, does have a nice office in San Francisco. So, I am hoping to persuade one or two of my e-discovery attorneys in that office to show up at the dinner for me, to clap a million times where appropriate as awards are doled out, and, in case lightning strikes, to accept the award for me in absentia. In fact, I hope to make them Ralph face-masks to wear, just in case, so, if I win, they can make a convincing showing and quickly grab the hardware before any of the LTN editors figure out that I’m not really there, much less not a real CIO.

e-Discovery in Switzerland

Alice_Down_the_Rabbit_HoleWe used to think of e-discovery as a unique U.S. legal obsession, but that is not true anymore. Our little preoccupation of following evidence down the rabbit hole of technology is now a worldwide phenomena. This was very evident at a couple of events I attended last month in Zurich and London. I’ll start off with Zurich, which has got to be one of the most beautiful cities in the world. The city seemed like a kind of Disney World, super clean, nice and expensive, but without the annoying characters or tourists, and, incredibly quiet. Zurich is all about pristine water, the Swiss alps, and environmentally conscious, healthy, smart people.

I knew all that coming in, but what I did not know until I got there was how sharp and interested the Swiss Bar would be about e-discovery, especially with an advanced topic like predictive coding. I now know why half the world’s money is stashed in Switzerland. They are a very secure bunch, and all carry Swiss army knives and ride around on bikes. Their only vice in Zurich appears to be chocolate, which they eat constantly, and even drink. The only negative thing I can say about Zurich is that it shuts down at 9:00 and it is thereafter impossible to find a good restaurant.

Taylor_HoffmanI was invited to Zurich by Swiss Re e-discovery department to be on a panel that followed the premiere in Switzerland of Joe Looby’s documentary, The Decade of Discovery. Our primary host was Taylor Hoffman, SVP, Head of eDiscovery at Swiss Re. What a dream job Taylor has. He primarily works in New York, but spends a lot of time in Zurich. Jason Baron and his wife, Robin, and I had a seven-course lunch at the private dining facility as Swiss Re’s headquarters overlooking Lake Zurich. We were joined by other members of Swiss Re’s legal department, plus some e-discovery lawyers who came in from Germany and elsewhere to meet and greet. We discussed e-discovery between various wine pairings and ever-changing dishes.

The focus on e-discovery in the EU is all about government investigations, a fact later confirmed by my discussions in London. They also focus on privacy and cross-border issues, and seem to think we are barbarians when it comes to privacy. Since I do not really disagree with them on their privacy criticisms (See: Losey, Are We the Barbarians at the Gate? (e-Discovery Team, Sept. 1, 2008)), a position that seemed to surprise them even more than my being a blogger in a suit, I was able to dodge the daggers very politely thrown at Jason and me.

hide the ballInstead, being the accomplished diplomat that I am (I even have my own email server, rather than blind copying the Chinese on everything), and used to arguing with lawyers everywhere, just as a matter of professional courtesy, it did not take long (one glass) for me to bring up the whole pesky notion of truth and justice. Namely, how can you have justice when both sides in litigation are permitted to hide any documents that they want? They explained to me, an obviously naive and hopelessly idealistic American, that in civilized society, namely Europe, all you are required to disclose are the documents, the ESI, that happen to support your case. In civil litigation you only produce the documents that support your side of the story of what happened.

JusticeThey have virtually no conception of a duty in private litigation to disclose to opposing parties the documents that you have found that show your witnesses are “misremembering” the facts, i.e.- lying. You can imagine how diplomatic I was, and how squirmy and quiet Jason soon became, but it did all end well. We agreed that no one should lie to a judge. Apparently judges everywhere get tired of all of the contradicting allegations and may force both sides to disclose the truth, the whole truth, and nothing but. Apparently, however, that is rare in non-criminal litigation. The primary focus of the kind of disclosure that we know, involving both good and bad documents, is in criminal cases, government investigations, and private, internal investigations.

I asked the non-Swiss Re attorneys attending the lunch how much of their time they spend doing e-discovery work, as opposed to other types of legal services. The answer was it depends, of course, but upon close cross-examination (yeah, I was popular), I learned that the percentage was from 10% to 25%. Remember, these are the outside counsel with special expertise in e-discovery. To me that made it all the more impressive to see how quickly the Zurich attorneys got it who attended the The Decade of Discovery movie. They paid attention, and most importantly, they laughed at all of the right places and seemed to understand. Their questions were good too. They were an unusually astute group, considering that no one outside of Swiss Re and the sponsoring vendor, Consilio, actually do much of this work.

Michael-BeckerConsilio sponsored Joe Looby’s movie showing in Zurich, and then again in London. Consilio’s Managing Directors also presented at both panels following the show, Michael Becker (shown here) in Zurich and Drew Macaulay in London. My thanks for Concilio’s gracious sponsorship and well-run events. Also presenting at these events were Joe Looby, Jason Baron, and Taylor Hoffman.

The main draw was not the panel discussions, as interesting as I think they were, but rather the movie itself, Looby’s Decade of DiscoveryEveryone in Zurich assumed I had seen the documentary many times, but in truth that was only the second time I had seen it. The first was the major showing in DC where everyone who is anyone attended, and most of us wondered how we ended up on the cutting room floor. Still in DC it was a standing ovation, and very emotional, as the star of the movie, Richard Braman, had recently passed away. This movie is a fitting tribute to his work.


Notice how the movie poster says “Justice … is the right to learn the truth from your adversary.” Who knew that is not a popular sentiment in Europe and the UK? We need to learn about privacy from them and they need to learn from us about the importance of full disclosure.

The Decade of Discovery movie prominently features the award-winning Mr. Baron, as the journeyman to Sedona. It makes for a good story, and in the process explains predictive coding pretty well.

I made a movie with Jason myself many years ago, Did You Know: e-Discovery? Apparently our short little slide-show type video is now hard to find, so, even though it is not in the same league as Looby’s real movie, I reproduce it here again so all can easily find it. I can brag that all of our predictions have, so far, come true and the exponential increase in data continues. Feel free to share it by using the share button in the upper left. I would reproduce the Decade of Discovery movie instead, but it is not available online.

Unlike my little slide show video with Jason, Joe Looby’s Decade of Discovery is a real movie. Now that I have seen it twice, I appreciate it much more. I urge you to take time to see it if it ever comes to your town. Check out Joe’s Facebook page for his movie company 10th Mountain Films.

Joe_LoobyOne of the surprise treats from my European trip was to learn what a great guy Joe Looby is. I did not really know Joe. What a pleasure to learn there is no b.s. in Joe, and no big ego either. I did not make any money, nor get any new clients from this trip, but I did make a new friend in Joe Looby. Skeptics may think I’m just kissing up in the hopes of getting a part in an e-discovery sequel, but that’s not true. Joe’s next documentary will concern how emergency decisions are made in the oval office, think Cuban missile crisis. I for one cannot wait to see it. Joe is a true scholar and artist and is evolving beyond his roots in law. Unlike Jason and I, he will surely go on to bigger and better movies. It would not surprise me to see him at the Oscars some day.

e-Disclosure in London

Lord Chief JusticeWe showed the movie in London and had a panel, where, surprisingly the lawyers in attendance did not seem as engaged as the Swiss. We even served popcorn at this event, so go figure. Maybe it was because it was raining (but isn’t it always in London), or maybe it was that whole truth for justice approach that us yanks have. Anyway, Jason, Joe and I had a good time. By the way, they do not call it e-discovery in the UK, they call it e-disclosure. Also, and this amazes me, they do not take depositions over there, or least it is very rare. They just serve prepared statements on each other. That and produce the documents that they want you to see, and hide the rest. The Barristers must be very skilled at cross examination to earn their wigs.

The day after the London movie Jason and I were a keynote at the IQPC event at the Waldorf Astoria in London. We were billed as the great debate on Information Governance. Jason was pro, of course, and I was sort of against, as per my old blog post, Information Governance v Search: The Battle Lines Are Redrawn.  Our keynote was entitled: Let’s Have A Debate About Information Governance — Are We at the End or At the Beginning?

BaronsThe event was the IQPC 10th Anniversary of Information Governance and eDiscovery. Everyone there was either already an IG specialist or hoped to be one. In other words, I was there to argue to the audience that they were all wrong, that IG was dead. Needless to say, my presentation did not go over that well, and Jason soundly won. Even though the deck was stacked against me going in, Jason pulled out all the plugs to make sure he won decisively. I found out why he is banned by his family from playing Monopoly because he is over-competitive, a story he tells whenever he talks about cooperation. His beautiful wife Robin, shown right with Jason in Zurich, confirmed that story for me later. And much more, but I am sworn to secrecy.

british flagSo anyway, just to be sure that he beat me at the great debate, Jason changed the rules at the last moment to have some strange formal debate structure that I’d never heard of involving stop-watch timing, which he controlled. Then, at the closing he surprised me with a carefully scripted speech that he must have stayed up all night writing. He evoked Winston Churchill’s War Room, that was just a few blocks away, and then finished with a rousing quote from the end of Churchill’s most famous speech, We Shall Fight on the Beaches. The only thing missing was a Union Jack draped around his shoulders. The crowd went crazy with patriotic fervor and go-team IG enthusiasm. They will never surrender! It was the only time I saw London lawyers express any emotion. They were real quiet after I followed Churchill, I mean Baron, with my closing statement. Since Baron was Churchill urging all good British citizens to fight on for Information Governance, it was not hard to figure out who they thought I was. I was lucky to be able to goose step out of there alive.

Alison_NorthWell, at least I made some friends by my attack of the London IG establishment, including Alison North, another presenter at the event who is an IG expert herself. She was very nice, protected me from the flying umbrellas that came my way, and politely said she agreed with me. It was more of a whisper really. We sat together for most of the event after that. I was glad to meet such an obviously sophisticated, anti-establishment thinker. We even tried to build a structure out of toothpicks together to hold a marshmallow up in the air as high as possible. That is apparently what lawyers in London do for team building at CLEs. We were at the table with Craig Ball, who was very keen on winning this event. We spent a good fifteen minutes arguing with Craig the ethics of his interpretation of the contest rules. Even though I won that debate, I got called away, so as a team-builder, it was a another loss for me.

Ball_London_15Craig Ball gave the keynote presentation to kick-off the event the first thing in the morning. That is a difficult time slot and I thought he did a good job. As you can see from the photo I took, they had crazy disco type lighting. On stage it was hard for a speaker to see the audience over the bright lights. Craig made many attempts to humor and entertain the London IG professionals. I smiled and laughed a few times, but was alone. Most of Craig’s witty remarks did not even draw a smile, much less a laugh. Only when he made an off-color reference to Fifty Shades of Grey (who better than Craig to do that) did he get a laugh.

I learned a lesson from his start and did not even try for humor. Apparently it does not translate well into whatever language it is they speak over there. In fact the only speaker that was able to get the audience riled up was the Baron of IG himself with his Churchill impression. You know when Craig speaks here again he will surely quote Churchill at length.

Judge_LaporteOther presentations at the event included, U.S. magistrate Judge Elizabeth Laporte (shown right), whom I always enjoy hearing. She did very well with the British Judges on her panel, pointing out that if you are in her court, you have to follow U.S. rules requiring mutual full disclosure, like it or not. The rules of UK and other foreign courts are not what govern. Also presenting and moderating at many of the panels was the reporter, blogger, and retired Solicitor, Chris Dale, whom at the time I thought was a colleague and friend.

Also keynoting at the IQPC were Jeffrey Ritter, Professor of Law, Georgetown University; Jamie Brown, Global eDiscovery Counsel, UBS; Karen Watson, Digital Forensic Investigations, Betfair; Greg O’Connor, Global Head of Corporate, Policy and Regulation, Man Group; Anwar Mirza, Financial Systems Director, TNT Express; and, Jan-Johan Balkema, Global Master Data Manager, Akzo Nobel.

_Balazs_BucsayIn addition to debating Baron on IG, I presented with a reformed black-hat hacker, Balazs Bucsay, who now works for Vodaphone, and Judge Michael Hopmeier, Kingston-on-Thames Crown Court. We had a very short 35 minute panel presentation on cybersecurity. Hacker Bucsay, who is one scary guy, gave a demonstration where a volunteer came on stage and had his password hacked. Impressive. Judge Hopmeier – who was a great guy by the way, tech savvy, frank and outspoken – told everyone how many cybersecurity crimes he sees, and shared a story of a brilliant teenage hacker charged with a serious crimes, even though no money was taken. The kid did it for fun, much like Bucsay used to do. But often it is done by hardened criminals or terrorists. Judge Hopmeier well understands the problem. I hope he is invited to speak in the U.S. soon. We need to hear from him.

Data_Breach_Cost_2014I emphasized Judge Hopmeier’s points on the enormity of the problem, and the Billions of dollars now lost each year by cyber crimes. The average cost of a data breach last year was $3.5 Million. Then I closed with twelve pointers on what a lawyer can do about cyber crime to try to protect their legal practice and their client’s data:

  1. Invest in your company or law firm’s Cybersecurity.
  2. Think like a Hacker and allocate resources accordingly.
  3. Most Law Firms should Outsource primary targets.
  4. Keep Virus Protection in place and updated.
  5. Harden your IT Systems and Websites; $$ and people.
  6. Intrusion Response Focus (Hackers will get in).
  7. Penetration Testing and Vulnerability Scans
  8. Train and Test Employees on Phishing and Social Engineering; Reward/Discipline to prove you are serious.
  9. Be Careful with Cloud Providers and their Agreements.
  10. Buy as much Insurance as possible (insurer guessing game).
  11. Change Laws to make Software Cos Accountable for Errors.
  12. Update Anti-Hacking Laws.

Chinese-cyber-warIt was the only panel on cybersecurity at the IG CLE, which, as far as I am concerned, is a huge mistake. It was late in the day and not well attended. The IG crowd does not seem to grasp the importance of the problem. The Chinese Army applauds their apathy. Let me be very clear using a recent event as an example where they hacked the U.S. government employee database and email. If you are one of the four million past and present federal government employees impacted, the Chinese military not only knows where you live, and has your social security number, user names and passwords, they also know pretty much everything about your personal and professional life. Experts Say China Is Hacking Federal Employees’ Info to Create a Database of Government Workers.

If you are a federal employee who has been a bad boy or girl, say you had an affair, or took a bribe, or maybe you are paying brides to former high school students you molested years ago like Dennis Hastert, they probably know about that too. They read your emails, texts, and Facebook posts. If you have any kind of security clearance, they will have a couple of paid hackers monitoring your every move on the Net. If you were bad, or otherwise have something to hide, they will try will try to extort you. That is what spies do. The FBI is taking this seriously. The four million plus federal employees whose email was hacked should too.

Diner at the Savoy

SavoyI do not usually mention CLE speaker dinners, but the one hosted by Recommind at the IQPC deserves an exception. It was held at a private dining room in the Gordon Ramsay’s Savoy Grill, in The Savoy hotel. I stayed at the Savoy in Zurich and wish I had in London too. But do not waste your time eating at the other famous restaurant at the Savoy, Simpson’s-In-The-Strand. The atmosphere at Simpson’s was good, but not the food. Ramsay’s Savoy Grill, on the other hand, was so good that we went back there the next night. It was by far the best food we had in London, even though some of the waiters spoke with a fake French accent that sounded just like Steve Martin’s Inspector Clouseau. No. Hamburger was not on the menu.

Sherlock Holmes in the Twenty First CenturyWhat made the Recommind dinner special was the group of people they brought together as guests. This was primarily a group of young UK attorneys, the ones who specialize in e-disclosure. Many of them were not able to attend the IQPC event, but they did accept an invite from Recommind for dinner at the Savoy. Aside from the famous Chris Dale, there were only a couple of other speakers there. Most of the dinner guests were true London lawyers, with a couple of Americans lawyers thrown in, those who were lucky enough to be transferred to London. It was a sophisticated group of very smart creatives, all with lovely accents. I felt right at home will all of them and found we had much in common, including my London favorite, Sherlock Holmes.

RALPHCaricatureThis was not my first trip as a speaker to London. Last year I spoke about predictive coding at the famous Lincoln Inn, and also had a dinner with a small group of specialists and judges. That was sponsored by Kroll. I look forward to an opportunity to speak in London again. It is very important to both of our countries that we maintain a close relationship. Next time, however, I just want to speak about predictive coding and cybersecurity. I will leave IG to Jason. You know, old man, it is not really my cup of tea.

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