Starts to Work
The word "discovery" implies a soaring experience similar to a voyage by Christopher Columbus. Idealistic young associates were once thrown into the discovery phase of litigation and told: "Litigation is about finding the truth! That's what you're going to do during discovery! Go uncover evil, malfeasance and wrong-doing, and let justice be done!"
Associates quickly discovered that discovery actually involved finding and sorting paper, Bates-stamping the documents and photocopying and organizing mountains of files while the outcome of the litigation was negotiated behind closed doors. Discovery, they discovered, was actually used to hide the truth, bury opposing counsel in paper, run up everyone's costs and support the accordion file and cardboard box industries.
The advent of electronic media at first made the horrors even worse, through the volume of information and the technical difficulties and expense of data retrieval. But tackling the digital discovery dilemmas may end up improving the entire process, at long last.
It's the volume, stupid
Digital discovery can be a nightmare. The volume of information in the age when e-mail is supplementing telephone calls has grown exponentially. Ken Withers, a research associate at Washington, D.C.'s Federal Judicial Center, who speaks and writes frequently on electronic discovery, estimates that a hypothetical company of 100 employees will generate a total of 7,500,000 messages a year.
The nightmare deepens. These documents reside in many places. Aside from the "obvious" places--obvious to experts hired specifically for the occasion, that is--key evidence may be hiding in records of instant-message sessions; chat rooms; unified message systems that combine e-mail records with voice mail tapes; USB (universal serial bus) flash drives; digital TV recorders; MP3 players; global positioning system satellite records that track vehicle locations; and even databases of shopping habits compiled from supermarket discount cards.
And of course such records might be at the office, or at home, on any one of the devices that store such data: laptops, Palm Pilots, BlackBerrys, cellphones.
In addition to the volume of evidence, digital records are much more technically difficult to access and organize, even though it's great they've now automated the Bates-stamping process, which can consume huge amounts of an associate's or a paralegal's time.
But the battles of the experts over the data now start earlier than ever. In a recent case, Residential Funding Corp. v. DeGeorge Fin. Corp., 2002 WL 31120098 (2d. Cir. Sept. 26, 2002), the 2d U.S. Circuit Court of Appeals ordered the trial court to impose discovery sanctions when the plaintiff failed to produce e-mail evidence in time for trial. The plaintiff's selected vendor was unable to retrieve the e-mail for the relevant time periods from the plaintiff's backup tapes. After the plaintiff asserted to opposing counsel and to the court that the e-mail could not be retrieved, the defendant retained an evidence expert who retrieved the relevant e-mail in four days.
Don't forget the costs, which are higher than ever. To take just one example: In the 1999 case Linnen v. A.H. Robins Co., 10 Mass. L. Rptr. 189 (Mass. Super. Ct. 1999), the anticipated cost of restoring data from 17 months of e-mail backup tapes approached $1.75 million.
And it's just going to get worse--93% of all information generated in 1999 was generated only in digital form, according to a study conducted by the University of California at Berkeley using the last year for which data was available. An increasing amount of information will exist only in electronic formats. This is our brave new world of discovery.
The digital dawn
But there may be a light at the end of the discovery tunnel: Real reform of the discovery process may be happening before our very eyes. Judges are now getting involved earlier than ever to decide the scope of discovery and the allocation of costs. New Jersey Magistrate Judge John Hughes, who presided over In re Bristol-Myers Squibb Securities Litigation, 205 F.R.D. 437 (D.N.J. 2002), believes that when judges and experts are retained early, and the parties are forced to confer in court on discovery issues, discovery can proceed very smoothly.
Hughes should know. In Bristol-Myers, the defendant hid the fact that its documents had been scanned during the ordinary course of business and were available on a CD-ROM for about $20 per CD. Instead, the parties had agreed to paper production and a per-page photocopying price, and the defendant was "blowing back" the paper onto the plaintiffs to follow the old familiar practice of burying the other side in a blizzard of documents and photocopying costs.
Hughes noted that both parties had obligations under the Federal Rules of Civil Procedures to take the "meet and confer" obligations seriously. Specifically, Fed. R. Civ. P. 26(a)(1)(B) requires the parties at the earliest stages of litigation to exchange: "a copy of, or a description by category and location of, all documents, data compilations, and tangible things that are in the possession, custody, or control of the party and that the party may use to support its claims or defenses, unless solely for impeachment."
Hughes interpreted this rule as an affirmative obligation on the producing party, as part of its voluntary initial disclosures, to provide notice that certain relevant information was in electronic form. Thus, the judge ordered that the defendants had to bear the costs of producing electronic information on paper, since that had been their choice. The plaintiffs had to assume only the small cost of copying the CDs.
In an interview, Hughes reiterates that the current discovery rules can ease the burdens of electronic discovery. "At the earliest possible opportunity, the lawyers should discuss with their adversaries how they're going to go about conducting electronic discovery," says Hughes. "In the old days, there was a documents retrieval person," he says, who could produce and screen the information. "Now you really need an information technology specialist. Under a Rule 16 order, I identify the IT people on each side. They know how to go about it. Get it over with early--it is electronic information, it is a novel thing," but lawyers must be aware that their obligations are the same as before, he says. "One thing I wanted to get across in Bristol-Myers is that attorneys must be aware of electronic-discovery issues--the costs, the volume, the choices in means of production."
If possible, says Hughes, get the clients involved, since it's their computer systems that are going to be searched. "The information might not be stored on-site," he notes. He urges involving the IT manager at the company. "If someone in the company is responsible for dealing with the court, there are fewer chances of shenanigans," he says, adding that he has no problem issuing orders limiting discovery. The lawyers are much more difficult to deal with than the clients, and their paper-based discovery habits are hard to break, he says. "This is America, with expansive discovery," acknowledges the judge. But in the digital world, that doesn't mean "any and all."
Good-bye to 'any and all'
In the paper world, a production request consisted of copying the language from an old one, changing the date and sending it to opposing counsel. These older requests generally included the phrase "any and all"--give us any and all information you have related to this conflict, this product, this person, this universe. At first, lawyers imported that language into the digital age. Most still do.
"Any and all" doesn't work in the digital age. "A lot of lawyers don't know what to ask for," says Hughes. But they will have to figure out more specifically what they want now, and how to organize the information. "It has to be handled with specific management techniques," says the judge. Parties must ask permission of the court today to serve expansive "any and all" discovery requests, he notes. There's an army of consultants who will assist with the technical difficulties, but in the future, we will see attorney-managed discovery for the first time in a long time, says the judge.
Judge-managed discovery is emerging. In a groundbreaking case earlier this year, Rowe Entertainment Inc. v. The William Morris Agency, 205 F.R.D. 421 (S.D.N.Y. 2002), the federal district court delineated an eight-factor test for deciding which party would bear the costs of electronic discovery. The court chastised the requesting party for making an overly broad discovery request and held that request against it in deciding to shift the burden--ordering the requesting party to bear the costs of electronic discovery.
Hughes is sanguine about the glitches. "If you identify this as an issue early on, and you have in-house experts in connection with corporate clients, and hire an IT person, and figure out how to produce the documents in a reasonable way--it's much more cost-effective than the old ways," he says. "In five years, this will be the normal thing. The exchange of information will be far easier" than in the paper world.
Ronald Reagan used to tell an old joke about a little boy digging through a pile of manure, saying, "I know there's a pony in here somewhere!" Well, after all our digging through digital discovery, there may be a prize underneath after all: a reasonable discovery process.
This article is reprinted with permission from the November 4, 2002 edition of The National Law Journal. © 2002 NLP IP Company. www.nlj.com. All rights reserved.