February 2007

February 2007

NEW RULES FOR PRODUCTION OF ELECTRONIC DATA IN LITIGATION

With the explosion of the use of the internet and email for communications between businesses and within companies and the increasing use of multiple forms of electronic storage of data, courts have increasingly been called on to resolve disputes between parties in litigation regarding the production of electronically stored data. Frequently, courts have found that the traditional discovery rules are not designed to address how electronic information is stored or disposed of in today’s business climate.

As we discussed in our September 2006 Newsletter (which may be found on our website at www.lawatddp.com), parties to a lawsuit have a duty to preserve all information that may be relevant to the issues in the litigation. The Federal Courts have adopted new rules, which became effective in December, 2006, to provide guidance for preserving and producing electronically stored information. These rules also update the rules for sanctions if electronic evidence is either destroyed or not produced.

The new Federal Rules specifically require that “electronically stored information” must be produced to opposing parties. The production of such information or a description of the electronic data known to a party is mandatory very early in the case. Additional documents or information may be requested by opposing parties through the discovery process during the course of the litigation leading up to trial. The new rules do not permit a party to fail to disclose the information or make the information available to the opposing party for reasons that the information is difficult or costly to retrieve.

Requests for production of electronic documents or information by an opposing party in the discovery phase of litigation may be specific as to the form in which the information is to be produced. For example, the request could call for: (1) the delivery of a printed copy of all data, or (2) delivery of a disk with all data, or (3) delivery of the hard drive or other storage system. The producing party may then object to the requested form of production and propose an alternative method. If the parties cannot agree, the Court will decide what form should be used. If no specific form is requested, the producing party may produce the electronic data either in the form in which it is maintained or in a form that is reasonably usable.

The new rules also attempt to address the problems Courts have faced when electronic information that is relevant to the litigation is not preserved or destroyed after the commencement of the litigation. The rules have established a “safe harbor” for a party that fails to provide electronic data that is lost as a result of routine, good-faith operation of an electronic information or storage system. However, this safe harbor will itself likely be subject to dispute as the courts attempt to define what actions may or may not fall within the parameters of acceptable destruction of data.

Perhaps the most significant change with the new Federal Rules is the requirements for the lawyers for the parties to address the new electronic data discovery and disclosure matters during the initial conference and at the initial scheduling conference with the court. The purpose of the new requirement is two-fold: first, the rules hope to ensure the lawyers understand the new rules, and second, it is believed that the new rules will prevent issues of spoliation of the electronic data that could result in discovery disputes and sanctions that can result in severe expense and penalties to the parties later in the case.

We will address in more detail other aspects of the requirements of the new Federal Rules in future Newsletters.

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This Newsletter is provided for information purposes only.  Accordingly, the information is general in nature and is not intended to address a specific issue or problem.  The reader should seek legal counsel of his or her choice for specific problems.  The receipt of this Newsletter does not create an attorney-client relationship with the author or the law firm of Dean, Dunn & Phillips LLC.