Will e-discovery get squeezed?
JAMES E. ROOKS Jr.
New proposed amendments to the Federal Rules of Civil
Procedure would limit discovery of electronic data and give
defendants more opportunities for obstruction.
The quest for proof in products liability cases might remind
us of two rhetorical gems of 1960s pop culture. In 1965, Bob
Dylan advised us with impeccable logic that “when you
got nothing, you got nothing to lose.”1 Two
years later, chain-gang prisoner Paul “Cool Hand Luke”
Newman made some of us feel a bit better by assuring us that
“sometimes nothin’ can be a real cool hand.”
Neither Bob nor Luke was a products liability lawyer.
If there are situations in which “nothin’ can
be a real cool hand,” proving liability in the courtroom
is not among them. In court, “when you got nothing”
by way of evidence of liability, you and your client have
everything to lose—and you will.
It is hardly surprising, then, that there are squads of
lawyers whose main occupation is ensuring that plaintiff lawyers
with products liability cases have nothing in the way of proof—or
as close to nothing as can be achieved. It’s their job,
and many of them are very good at it.2 Lately they’ve
been getting too good at it for comfort, and the ever-increasing
contraction of discovery rights through court rule amendments
helps them to keep secret information that will prove the
products liability case.
For at least the past 15 years, the ability of requesting
parties—which, in products liability cases, usually means
the plaintiffs—to use the broad discovery rights originally
envisioned in the Federal Rules of Civil Procedure, and the
notice-pleading regime they complement, has been steadily
curtailed.3 Similar developments have been seen
in state courts, owing to the trickle-down effect of the federal
rules on their state counterparts.
In major part, discovery rights have been truncated through
neither the intransigence of opposing parties nor the rulings
of judges—but through amendments to the rules themselves
by the federal courts’ own official rule-makers,4
urged on by the lobbying of tort “reform” advocates.5
During that period, federal court litigants have lost at
least the following:
-
the right to obtain information through lawyer-managed
discovery, not through mandatory, limited disclosure requirements
-
the right to determine how many interrogatories and
depositions are necessary to develop adequate proof
-
the right to depose a witness for as long as it takes
to get answers to relevant questions
-
the right to get all relevant information, not merely
what the opposing party decides is supportive of claims
and defenses
-
the right to complete discovery without repeated hearings
before judges or discovery masters, with the attendant
cost in time and money.
Throughout this period, for every de jure right lost, an
opposite de facto right has been created for defendants. Most
of this occurred in the rule amendment cycles of 1993 and
2000.
The 1993 discovery amendments. The 1993 amendments established
the federal courts’ current system of initial disclosure,
which relieved federal judges of some of their discovery workload.
The amendments also established presumptive limits of 25 interrogatories6
and 10 depositions7 per side in each case. Escape
from the presumptive limits requires at least one motion by
a requesting party and a decision by a judge, magistrate judge,
or discovery referee. The net effect has been increased time
and money spent on discovery—a change that has benefited
defendants more than plaintiffs.
The 2000 discovery amendments. These changes included proposals
long advocated by both the American Bar Association’s
Section of Litigation and the American College of Trial Lawyers—organizations
that, while nominally neutral, are populated largely by corporate
and insurance defense counsel.
The rule-makers made initial disclosure mandatory for nearly
all cases, in all courts; limited the required disclosure
to information supporting the disclosing party’s claim
rather than requiring disclosure of all information relevant
to the case; established a presumptive limit of “one
day of seven hours”8 for depositions; and—most
critically—narrowed the scope of discovery defined in
Rule 26(b)(1) from “the subject matter involved in the
action” to “the claim or defense of any party.”
What—or who—drives this curtailment of discovery
rights? The public comments on the 2000 amendments show clearly
the interests that promote this kind of rule-making: A number
of the proposals that led to the 2000 amendments were supported
by officers of, or advocates for, business and defense bar
organizations. Among them were the Chemical Manufacturers
Association, the Defense Research Institute, Dow Chemical
Co., the Federation of Insurance and Corporate Counsel, Ford
Motor Co., the International Association of Defense Counsel,
Lawyers for Civil Justice, the National Association of Manufacturers,
the Product Liability Advisory Council, Roche Pharmaceuticals,
Shell Oil Co., and various defense bar organizations.
Several proposals were opposed by consumer, public interest,
and trial lawyer organizations, and by academics. Among the
groups were the Lawyers’ Committee for Civil Rights Under
Law, the NAACP Legal Defense Fund, the National Association
of Consumer Advocates, the New York State Bar Association’s
Commercial and Federal Litigation Section, and ATLA. And both
the scope-of-discovery amendment and a cost-shifting proposal
(which the Judicial Conference later rejected) were opposed
by the U.S. Department of Justice.9
At its September 1999 meeting, the Judicial Conference handed
the rule-makers a victory, approving all but one of the discovery
amendments.
Targeting e-discovery
The latest phase of the campaign to curtail discovery rights
began officially in August 2004 with the publication of a
new set of proposed amendments to the rules, directed at perceived
problems of electronic discovery and privilege waiver. The
proposals are published to elicit comments from the judiciary,
the bar, and the public on whether they should be adopted
formally.
Where did the latest proposed rule amendments come from?
While the 2000 amendments were being developed, a lobbyist
for several business organizations urged the rule-makers to
address problems related to inadvertent production of privileged
materials. The Defense Research Institute made more extreme
suggestions, including putting presumptive time limits on
discovery of documents and electronic materials, and treating
e-mail messages like telephone conversations rather than written
memoranda.10
On its face, the analogy between sending e-mail and communicating
by telephone not only is absurd, but flies in the face of
modern business practices: E-mail has become the primary mode
of communication and record-making for millions of workers.
Many businesses now seldom, if ever, use regular mail or fax
or make written memos or notes and rely almost exclusively
on messages they send electronically.
Messages are saved and sometimes printed to preserve information
and reconstruct past events. Fleeting verbal communication,
in contrast, can be reconstructed only through the memory
of participants, which raises hearsay issues and opens the
way for misconstruction, outright fabrication, and claims
of lack of memory.
To treat e-mail messages like telephone calls would create
a loophole in the accountability of wrongdoers that would
be greater than any immunity in substantive law. The mere
suggestion of this approach was a blatant and clumsy attempt
to put masses of electronic information effectively beyond
the reach of discovery.
Anyone who doubts the necessity of treating e-mail messages
like written correspondence need only consider the recently
settled fraud litigation brought by the state of New York
against GlaxoSmithKline over its concealment of clinical test
data on the antidepressant Paxil. Investigators found an internal
company e-mail that discussed management’s perceived
need to “effectively manage the dissemination of these
data in order to minimize any potential negative commercial
impact.”11
Once the work on the 2000 amendments was concluded, both
electronic discovery and privilege waiver became new areas
of inquiry for the rule-makers’ continuing study of discovery.
The stated purpose of these proposed amendments is to cure
alleged problems involving e-discovery. The arguments for
the proposals are short on evidence of need for them. Many
lawyers, judges, and academics believe that the present federal
rules work well for all kinds of discovery, even in complex
cases, and need little, if any, change.
However, changing the e-discovery rules is a high priority
among corporate counsel, defense attorneys, and the burgeoning
industry of electronic discovery consultants and contractors.12
It appears that demand, rather than actual need, has produced
the 2004 proposals.
Triple threat
Some of the new proposals are benign, albeit unnecessary.
Three of them, however—which would add language to Rules
26 and 37—are problematic and possibly dangerous. Numerous
lawyers, academics, and judges have already complained that
these amendments, if adopted, will invite more discovery abuse,
give corporate litigants additional procedural and substantive
advantages, continue the erosion of the right to discovery,
and, ultimately, threaten the notice-pleading system and the
broad access to justice that are hallmarks of American law.
Two-tier discovery. This language would be added to Rule
26(b)(2):
A party need not provide discovery of electronically
stored information that the party identifies as not reasonably
accessible. On motion by the requesting party, the responding
party must show that the information is not reasonably accessible.
If that showing is made, the court may order discovery of
the information for good cause.
Trial lawyers argue that this proposal would establish an
unprecedented two-tier system of document production that
would invite abuse.
An example might be an instance in which the plaintiff requests
five-year-old data from the manufacturer of a product no longer
on the market. The data was duly stored but is now on backup
tapes held by a commercial data-storage company. Finding it
will require a search of many backup tapes. In response to
a request for production, the defendant objects that the requested
data is “not reasonably accessible.”
The plaintiff must file a motion to compel. If the court
is convinced that the data is not reasonably accessible, it
may sustain the defendant’s objection. If the plaintiff
can show good cause, the court may order production of the
data.
The “electronic data” age makes the concept of
inaccessibility absurd. If a company still used mid-20th-century
business practices and stored all its records in unmarked
cardboard boxes, the proposal might make a bit of logistical
sense, because searches of paper documents are difficult,
time-consuming, and expensive. Searches of electronic information,
however, can be conducted at lightning speed once the proper
media and search program are identified. There are degrees
of accessibility, but true inaccessibility occurs only when
a business has gone to special lengths to encrypt or hide
its data to avoid detection and accountability for bad deeds.
Allowing the producing party to self-designate electronic
information as “not reasonably accessible” will
invite even more stonewalling than requesting parties already
encounter. Requiring the requesting party to obtain the information
through an extra hearing before an already-overburdened federal
judge is oppressive and flies in the face of Rule 1, which
requires that the federal rules be “construed and administered
to secure the just, speedy, and inexpensive determination
of every action.” Even worse, adopting the proposal could
be an intermediate step toward establishing similar requirements
for all discovery requests.
“Claw back” of privileged material. This new section
(B) would be added to Rule 26(b)(5):13
When a party produces information without intending
to waive a claim of privilege it may, within a reasonable
time, notify any party that received the information of its
claim of privilege. After being notified, a party must promptly
return, sequester, or destroy the specified information and
any copies. The producing party must comply with Rule 26(b)(5)(A)
with regard to the information and preserve it pending a ruling
by the court.
Trial lawyers argue that letting a litigant claim privilege
for materials already produced—and routinely demand their
return—would sanction late declarations of privilege
made when the producing party believes the requesting party
has found a way to use them.
Consider the previous example, but this time the defendant
turns over the information without any review for possible
privilege. A later pleading suggests strongly that the plaintiff
believes the information contributes to his case for liability.
The defendant files a notice that claims the information is
privileged. The plaintiff must ask the court to review the
claim. In the meantime, the plaintiff lawyer may have to locate
any copies of the material that she sent to others and request
that they be returned to the defendant or destroyed.
It is hard to imagine a real “problem” that this
change would solve. It is not hard, however, to imagine the
satellite litigation the proposal would prompt. Like the two-tier
proposal, it would require extra hearings, with the inevitable
expenditure of lawyers’ time and judicial resources to
overcome the privilege claim. It would lead to more motions
to compel production (the only recourse allowed to the requesting
party), and it would set a high standard for a requesting
party to meet: proving that the information was not privileged,
or that the party “intended” to waive its privilege.14
Worse still, if adopted, this amendment would apply to all
discovery, not just e-discovery. It would create a new substantive
right with regard to privileged material, which is outside
the rule-makers’ power under the Rules Enabling Act.15
The rule-makers’ authority to make such a rule will inevitably
be challenged, leading to even more litigation.
Constitutional challenges might also be anticipated, as
the proposed amendment would in effect preempt state substantive
law that declares privilege nonexistent once disclosure is
made, even inadvertently. It would also preempt some existing
state ethics rules that require lawyers to use all disclosed
information that will advance their clients’ interests,
even if technically privileged.
Finally, the proposal would have a critical impact on one
of the few methods available to the plaintiff bar to circumvent
defense stonewalling and the use of secrecy orders: If the
producing party’s claim of privilege is successful, it
would require return or destruction of material passed along
to other attorneys or to organizations like the ATLA Exchange,
the Consumer Product Safety Commission, and other federal
and state agencies dedicated to protecting public health and
safety.
“Safe harbor” for data deleters. This new section
f would be added to Rule 37:
Electronically stored information. Unless a party
violated an order in the action requiring it to preserve electronically
stored information, a court may not impose sanctions under
these rules on the party for failing to provide such information
if: (1) the party took reasonable steps to preserve the information
after it knew or should have known the information was discoverable
in the action; and (2) the failure resulted from loss of the
information because of the routine operation of the party’s
electronic information system.
Trial lawyers argue that this proposal would green-light
destruction of information that would establish liability.
Under the present rules, entities that may become parties
to litigation are deterred—by the potential for charges
of spoliation—from destroying discoverable electronically
stored information. Giving companies a safe harbor when they
destroy information through the “routine” operation
of their document-retention system will invite them to set
up “routine” data purges at short intervals.
In one recent, notorious example, a tobacco company appears
to have used that very strategy. It set up a system that purged,
every month, e-mail messages more than 60 days old, making
them unavailable for production in litigation with the federal
government.16
Beyond litigation considerations, allowing short-term purging
of records used for the conduct of business (which sometimes
includes the commission of torts) is both bad policy and technologically
unjustified. Perhaps the paramount reason for storing data
electronically is that, in modern systems, nearly infinite
amounts can be stored indefinitely and searched quickly. The
cheapest and easiest thing a user can do with a computer is
to add storage memory. It is bad business practice to purge
recent records, for all the imaginable reasons for which businesses
have made record-keeping standard practice for centuries.
These proposed changes, like earlier rule amendments, would
amount to more than the sum of their parts. First, they would
join the body of earlier amendments whose cumulative effect
has been the destruction of many discovery rights available
to litigants 20 years ago.
Second, two of the 2004 proposals, the two-tiered-discovery
and safe-harbor amendments—which might not seem sinister
by themselves—would have a special combined effect. Operating
together, the two proposals would open a vast area for legalized
spoliation. The early, frequent, total, and “routine”
destruction of data, under a belief—or assertion—that
the data did not relate to a claim or defense in likely litigation,
would be protected from sanctions by the safe-harbor provision.
Rule 26(b)(2) creates a presumption that “inaccessible”
data is outside the scope of discovery without a court order
to the contrary, and Rule 37(f) would allow the destruction
of that “inaccessible” data, even if relevant to
the claims and defenses, until such a court order is in place.
By then it would be too late.
Everything to lose
The liberal discovery regime that supports notice-pleading,
minimizes costs and delay, and protects litigants from “trial
by ambush” is ours to lose.
If this campaign to alter the Federal Rules of Civil Procedure
succeeds, it will provide “producing” parties with
extra opportunities not to produce. It will force lawyers
to decline or abandon legitimate litigation for want of resources.
And along the way it will provoke satellite litigation, constitutional
challenges, and tests for compliance with the Rules Enabling
Act.
If it succeeds, in a little over 10 years, litigants will
have lost—in addition to all the rights discussed above—the
following discovery rights that existed before 1993:
-
the right to compel discovery of electronically stored
information in the same way information stored on paper
is discovered
-
the right to rely on state law regarding claims of privilege
-
the right to hold an opposing party accountable for
destroying electronically stored information in the same
way it would be held accountable for destroying paper
information.
If the debate over the content of the Federal Rules of Civil
Procedure were merely a drawing-room discussion among lawyers,
it might be less threatening. It might even lead to improved
rules.
But the involvement of the business and tort “reform”
lobbies from one end of the rule-making assembly line (the
Judicial Conference’s committees) to the other (Congress)
suggests strongly that this contest is not about electronic
discovery alone. In its most unvarnished nature, it is a raw
struggle to roll back the U.S. civil justice system to an
era when corporate interests had even more leverage in court
than they do now, leaving tort litigants with nothing to prove
their cases—and everything to lose.
See
SIDEBAR
Notes
1. BOB DYLAN, Like a Rolling Stone, on HIGHWAY
61 REVISITED (Columbia 1965).
2. For two examples of abusive discovery strategies employed
by members of the defense bar, see James E. Rooks Jr., Abridged
Too Far: Discovery Rights and the Campaign for Special E-Discovery
Rules, CORP. Couns., Oct. 2004, at EDD 18.
3. Some academics trace the campaign to diminish discovery
rights back as far as the Warren Burger Court. See Jeffrey
W. Stempel, Ulysses Tied to the Generic Whipping Post:
The Continuing Odyssey of Discovery ‘Reform,’ 64
LAW & CONTEMP. PROBS. 197, 206-07 (2001).
4. Rule-making is carried out through a system of committees
under the auspices of the Judicial Conference of the United
States, the policy-making body for the federal courts. For
a good synopsis of the rule-making process, see the federal
judiciary’s Web site, www.uscourts.gov/rules/newrules3.html
(last visited Sept. 28, 2004). See also ROSCOE POUND
INST., CONTROVERSIES SURROUNDING DISCOVERY AND ITS EFFECT
ON THE COURTS 4-6 (1999).
5. See James E. Rooks Jr., Rewriting the Rules
for Class Actions: Rulemaking Has Become Another Front in
the Tort “Reform” Wars, TRIAL, Feb. 2002, at
18.
6. FED. R. CIV. P. 33(a).
7. FED. R. CIV. P. 30(a)(2).
8. FED. R. CIV. P. 30(d)(2).
9. Judicial Conference Comm. on Rules of Practice and Procedure,
Draft Minutes 22-23, 25 (June 14-15, 1999), at www.uscourts.gov/rules/pracproc1.pdf
(last visited Sept. 28, 2004).
10. See Summary of Public Comments, Preliminary Draft
of Proposed Amendments to the Federal Civil Rules Regarding
Discovery 1998-99, at 190, 193, at www.uscourts.gov/rules/archive/1999/summary.pdf
(last visited Sept. 28, 2004).
11. See Brooke A. Masters, Paxil Maker Will Post
Its Unfavorable Test Results, WASH. POST, Aug. 27, 2004,
at E1.
12. The proposals have particularly strong support among
corporate counsel and the defense bar. An initial formulation
of the proposal’s language earned high praise from the
“E-Discovery Study Group” of Lawyers for Civil Justice
(a tort “reform” advocacy group), whose members
include representatives of BASF Corp.; Caterpillar Inc.; CIGNA;
ExxonMobil; General Motors; Microsoft; and Nationwide. Memorandum
from the Lawyers for Civil Justice to the Advisory Committee
on Civil Rules Regarding E-Discovery Proposals for Discussion
at the Apr. 2004 Meeting (Apr. 13, 2004) (on file with author).
13. The current Rule 26(b)(5) would become Rule 26(b)(5)(A):
“Privileged information withheld. When a party withholds
information otherwise discoverable under these rules by claiming
that it is privileged or subject to protection as trial preparation
material, the party shall make the claim expressly and shall
describe the nature of the documents, communications, or things
not produced or disclosed in a manner that, without revealing
information itself privileged or protected, will enable other
parties to assess the applicability of the privilege or protection.”
Judicial Comm. on Rules of Practice and Procedure, Advisory
Committee Report on E-Discovery Proposals, at www.uscourts.gov/rules/comment2005/CVAug04.pdf
(last visited Sept. 28, 2004).
14. The committee note accompanying the proposal states
that “if the party that received the information contends
that it is not privileged, or that the privilege has been
waived, it may present the issue to the court by moving to
compel production of the information.” Id. at
16.
15. 28 U.S.C. §§2071-77 (1982). The act grants
authority to the federal courts to make their own rules. However,
its §2072(b) provides that “such rules shall not
abridge, enlarge, or modify any substantive right.”
16. See United States v. Philip Morris USA, Inc.,
No. CIV.A.99-2496 GK, 2004 WL 1627252 (D.D.C. July 21, 2004);
see also Eric Lichtblau, Judge Fines Philip Morris
for E-Mail Loss, N.Y. TIMES, July 22, 2004, at C5 (reporting
court’s sanction order, fining Philip Morris $2.75 million
plus costs for destruction of more than two years’ worth
of e-mail messages).
JAMES E. ROOKS Jr. is senior policy research counsel at
the Center for Constitutional Litigation in Washington, D.C.
He has monitored federal court rule-making for ATLA since
1994.
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