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Wage And Hour E-Discovery:
New Challenges and Solutions Navigating the New E-Discovery Landscape After Zubulake
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WEDNESDAY, APRIL 4, 2012
Presenting a live 90-minute webinar with interactive Q&A
William C. Martucci, Partner, Shook Hardy & Bacon, Washington, D.C.
Danuta Bembenista Panich, Shareholder, Ogletree Deakins, Indianapolis
David D. Rohde, JD, LL.M., Senior Director, Litigation and
eDiscovery Solutions, Epiq Systems, New York
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5
Title Goes Here
Identifying Relevant
Information in Wage
and Hour Disputes
Presented By:
Danuta B. Panich
E-DISCOVERY STRATEGIES FOR
WAGE AND HOUR LITIGATION Strafford Publications Webinar – April 4, 2012
6
“ORDINARY” ESI WORRIES
LEGACY DATA
LOOSE FILES – UNSTRUCTURED DATA
ELECTRONIC MESSAGING
INSTANT MESSAGING
BACKUP RESTORATION
VOLUME, VOLUME, AND MORE
VOLUME!
7
WHAT MAKES WAGE & HOUR
CLAIMS DIFFERENT?
THE NATURE OF THE CLAIMS
ADDS NEW BREADTH TO THE
DEFINITION OF “POTENTIALLY
RELEVANT” INFORMATION
REQUIRES LOOKING IN UNCOMMON
PLACES
MANDATES REPURPOSING DATA
8
CHALLENGES BEGIN WITH
PRESERVATION
INCREASED EMPHASIS ON FRONT
LOADING INVESTIGATION
SIGNIFICANT BURDEN
DEBATE ON PROPORTIONALITY
9
PROPORTIONALITY IN
PRESERVATION
PROPONENTS SEVENTH CIRCUIT PILOT PROJECT
JUDGE GRIMM: VICTOR STANLEY, INC. v.
CREATIVE PIPE, INC., 269 F.R.D. 497 (S.D. Md.
2010)
JUDGE ROSENTHAL: RIMKUS CONSULTING
GROUP, INC. v. CAMMARATA, 688 F. SUPP 2d 598
(S.D. Tex. 2010)
10
PROPORTIONALITY IN
PRESERVATION
OPPONENT: S.D.N.Y. PIPPINS v. KPMG, LLP, 2011 WL 4701849
(S.D.N.Y. October 7, 2011) [Magistrate Peck]
aff’d 2012 WL 370321 (S.D.N.Y. February 3,
2012)
ORBIT ONE COMMUNICATIONS, INC. v.
NUMEREXCORP., 271 F.R.D. 429 (S.D.N.Y.
2010)
11
PROPORTIONALITY IN
PRESERVATION
UNDECIDED
FEDERAL RULES COMMITTEE
SEDONA CONFERENCE
12
IMPLEMENTATION
WRITTEN PRESERVATION NOTICE
PENSION COMMITTEE OF THE UNIVERSITY
OF MONTREAL PENSION PLAN v. BANC
OF AMERICA SECURITIES, 685 F. Supp.2d
456 (S.D.N.Y. 2010)
13
IMPLEMENTATION
COMPREHENSIVE PLAN
HARABURDA v. ARCELOR MITTAL USA,
INC., 2011 WL 2600756 (N.D. Ind. June 28,
2011)
PHILLIP M. ADAMS v. DELL, INC., 621 F.
SUPP. 2d 1173 (D. UTAH 2009)
14
IMPLEMENTATION
AUTOMATED FEATURES
ADVANCED MICRO DEVICES, INC. v.
INTEL CORP., 2008 U.S. Dist. LEXIS 98898
(D. Del. May 9, 2008)
TREPPEL v. BIOVAIL CORP., 249 F.R.D.
111 (S.D.N.Y. 2008)
15
COMMON WAGE & HOUR CLAIMS
EXEMPT STATUS
CONTRACTOR MISCLASSIFICATION
OFF-THE-CLOCK
WORKING AT HOME OR AFTER HOURS
WORKING DURING BREAK PERIODS
PRELIMINARY/POSTLIMINARY (DONNING &
DOFFING AND ITS WHITE COLLAR
EQUIVALENTS)
DENIAL OF REST AND MEAL PERIODS
TIP CREDIT
16
INFORMATION LIKELY TO BE
REQUESTED IN DISCOVERY
INCENTIVES TO PERFORM EXTRA
WORK
WORK RULES
PERFORMANCE EXPECTATIONS
DISCIPLINE AND THREATS OF
DISCIPLINE
PROMOTIONAL OPPORTUNITIES
CONTESTS, BONUSES,
AND COMMISSIONS
17
INFORMATION LIKELY TO BE
REQUESTED IN DISCOVERY
EVIDENCE OF MANAGEMENT’S
INCENTIVE TO “SUFFER OR PERMIT”
EFFICIENCY
PRODUCTIVITY
PROFIT
18
INFORMATION LIKELY TO BE
REQUESTED IN DISCOVERY
EVIDENCE OF JOB DUTIES
MANAGEMENT DIRECTIVES
MANUALS
WORK PRODUCT
19
INFORMATION LIKELY TO BE
REQUESTED IN DISCOVERY
DOCUMENT RETENTION POLICIES AND
PROCEDURES Jones v. Bremen High School Dist. 228, 2010 WL 2106640,
*9 (N.D. ILL., 2010)
WHAT THE COMPANY HAS DONE TO
PRESERVE AND COLLECT RELEVANT
ESI In re eBay Seller Antitrust Litigation, 2007 WL 2852364 at *2
(N.D. Cal., 2007)
Gibson v. Ford Motor Co., 2007 WL 41954 (N.D. Ga., 2007)
20
FLIP-SIDE OF THE COIN:
DISCOVERY FROM PLAINTIFFS
CALENDARS, DIARIES, OTHER
PERSONAL RECORDS OF TIME
WORKED
PERSONAL MEDIA
PHONE/TEXT LOGS
PERSONAL EMAIL ACCOUNT ACTIVITY
SOCIAL MEDIA ACTIVITY
Mancuso v. Florida Metropolitan University Inc.,
2011 WL 310726 (S.D. Fla. January 28, 2011)
21
THE COMPLICATING EFFECT OF
LIMITED RECORD-KEEPING
FLSA DOES NOT REQUIRE TIME
RECORDS FOR EXEMPT EMPLOYEES
AND INDEPENDENT CONTRACTORS
FLSA ALLOWS “EXCEPTION TIME”
REPORTING
FLSA REQUIRES RETENTION OF DETAIL
TIME RECORDS ONLY FOR TWO YEARS
22
RESULT?
INADEQUATE OR NON-EXISTENT
FORMAL RECORDS OF TIME
WORKED
23
WHERE TO LOOK FOR MORE
DATA?
BUSINESS SYSTEMS DATE AND TIME STAMPS REFLECTING
TRANSACTIONS e.g. CASH REGISTER
TAPES/POINT OF SALE DATA
DATE AND TIME STAMPS REFLECTING
INTERACTIONS WITH CUSTOMERS e.g.,
CUSTOMER BILLING, ORDER ENTRY
DATE AND TIME STAMPS IN MANUFACTURING
OR EQUIPMENT MONITORING
CAUTION: ARCHIVING DATA OFF THE ON-
LINE SYSTEM
24
CAUTION: ARCHIVING DATA OFF
THE ON-LINE SYSTEM
Often undertaken to preserve without impacting
system functionality.
“if a party creates its own burden or expense by
converting into an inaccessible format data that
it should have reasonably foreseen would be
discoverable material…then it should not be
entitled to shift the costs of restoring and
searching the data”
Orbit One Communications, Inc. v. Numerex Corp., et. al., 271
F.R.D. 429, 437 (S.D.N.Y. 2010), citing to Quinby v. WESTLB
AG, 245 F.R.D. 94, 104 (S.D.N.Y. 2006)
25
WHERE TO LOOK FOR MORE
DATA?
NETWORK AND COMPUTER
LOGS WINDOWS EVENT LOGS (SECURITY, APPLICATION,
AND SYSTEM LOGS)
SERVER SIGN-ON / USER AUTHENTICATION LOGS
OPENING APPLICATIONS
REMOTE ACCESS
DYNAMIC HOST CONFIGURATION PROTOCOL
RECORDS
AUDIT TRAILS
SYSTEMS EVENT LOGS
INTERNET ACCESS
26
WHERE TO LOOK FOR MORE
DATA?
DATE AND TIME STAMPS
ASSOCIATED WITH
COMMUNICATIONS MICROSOFT EXCHANGE LOG FILE ENTRIES
COMPUTER BASED LEARNING
E-MAILS
INSTANT MESSAGES
TEXT MESSAGES
BUILDING SECURITY/BADGE
SWIPES
27
WHERE TO LOOK FOR MORE
DATA?
ANYTHING ELSE
WITH A DATE/TIME STAMP
ASSOCIATED WITH A PARTICULAR USER
THAT CAN BE RETRIEVED/SORTED BY
INDIVIDUAL IDENTIFIER
28
COMPLICATING FACTORS FOR
PRESERVATION
IS IT A CLASS (STATE LAW),
COLLECTIVE (FEDERAL LAW) OR
HYBRID (BOTH STATE AND FEDERAL
LAW) CLAIM?
WHO IS “SIMILARLY SITUATED”?
VARYING LIMITATIONS PERIODS
CONTINUING VIOLATIONS
29
IMPACT OF CLASS OR
COLLECTIVE STATUS
ADDITIONAL INFORMATION REQUESTS
PUTATIVE CLASS MEMBERS
SUPERVISORS/WITNESSES
Recinos-Recinos v. Express Forestry, Inc., 2006 WL
2349459 (E.D.La. August 11, 2006)
CONFIDENTIAL PERSONAL
INFORMATION
Gilliam v. Addicts Rehabilitation Center Fund, 2006 WL
228874 (S.D.N.Y. January 26, 2006)
30
IMPACT OF CLASS OR
COLLECTIVE STATUS
UNCERTAINTY REGARDING
PRESERVATION OBLIGATIONS
Adorno v. Port Authority of New York
and New Jersey, 258 F.R.D. 217 (2009)
Point Blank Solutions Inc. v. Toyobo
Am. Inc., 2011 U.S. Dist LEXIS 42239 (S.D.
Fla. April 5, 2011)
31
RELEVANT TIME PERIOD
VARYING TIME PERIODS TWO OR THREE YEAR LIMITATIONS PERIOD
UNDER FLSA
STATE LAW LIMITATIONS PERIODS VARY
WIDELY
FLSA LIMITATIONS PERIOD ONLY TOLLED UPON
OPTING-IN
RULE 23 CLASS LIMITATIONS PERIOD TOLLED
FROM COMPLAINT FILING
CONTINUING VIOLATION
William C. Martucci, Partner
Shook Hardy & Bacon
202-783-8400 (Washington, D.C.)
33
Rule 26(f) Planning Conference
Partnering for Success: Inside &
Outside Counsel Working Together
The E-Discovery Working Group
Legal Considerations Based on
Zubulake v (SDNY)
Vendor and Search Considerations
34
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37
Partnering for Success
Technical
Business Legal
Not Interested: “Legal
projects are not recognized
on my Variable
Compensation Plan.”
Not Budgeted: “Staff is
scheduled for the next 18
months to do other things.”
Not Artful: “You must
preserve everything for
always”
38
Technical
•Lawyers/Paralegals
•In-house counsel
•Database Admin
•E-mail Admin
•Vendors
•Practice Support
Business •Unit managers
•Custodians
•Knowledge managers
Legal
Partnering for Success
• ESI-related views
• Mutual
• Time driven
• Extortionist
Opposing Counsel
Partnering for Success
39
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People
Technology Process
41
“The conduct of both counsel and client thus calls to mind the now-famous words of the prison captain in
Cool Hand Luke:
“What we've got here is a failure to communicate.”
Because of this failure by both UBS and its counsel, Zubulake
has been prejudiced. As a result, sanctions are warranted.” Judge Scheindlin – Zubulake V
Zubulake v. U.B.S., 229 F.R.D. 422, 424 (S.D.N.Y. 2004)
42
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Form the working group to handle the issues
Develop company standards and approaches to
e-discovery
Develop guidelines for in-house counsel on
e-discovery decisions, such as:
• preservation
• collection
• meet & confer
• privilege
Ensure monitoring of the process
44
45
Legal
(Corporate Counsel and Law Firm)
Information Technology
(IT)
(Records & Information Management (RIM))
Business Units
(Operations)
Addressing Matters
Collaboratively
46
The purpose of the Triangle Working Team is:
• To have a designated group of people prepared to address discovery
matters as they arise in litigation.
• To have a group with the capability to address discovery issues with the benefit of many perspectives: legal, IT, and business units (operations).
• To have a group that knows the law, knows the framework of the company’s information systems, and can be nimble and efficient as the litigation process evolves.
• To develop a working team whose members will be knowledgeable enough to “tell the story” in the deposition context of the efforts undertaken by the company in the discovery process.
47
The core goals of the Triangle Working Team are:
• To be knowledgeable about the company’s records retention, records
management, business units (operations) and information technology
systems.
• To develop effective approaches for identifying and collecting information
and documents in the discovery process.
• To anticipate and be prepared to tell the story of the company’s efforts in
discovery in the context of a Rule 30(b)(6) corporate representative
deposition.
48
Present Produce Review Collect Preserve
1. Identify and locate all sources of potentially relevant electronic information.
2. Suspend routine document retention/destruction policy and put in place a “litigation hold” covering the identified sources to ensure preservation of relevant electronic information.
3. Interview each “key fact individual” to understand how they stored relevant information and determine whether all potential sources of information have been inspected.
4. Communicate directly and periodically with the “key fact individuals” to ensure that they understand their duty to preserve all relevant electronic files.
49
5) Instruct the “key fact individuals” to save and produce relevant electronic documents such as emails.
6) Consider running a system-wide keyword search and preserving a copy of each “hit” to ensure that potentially relevant documents are retained.
7) Ensure that all relevant back-up tapes are segregated and stored in a safe place.
8) Repeat the process periodically by visiting with the “key fact individuals” to ensure compliance.
50
The Judges of the S.D.N.Y. are rigorous on e-discovery:
Magistrate Francis imposed spoliation sanctions upon a finding that
the defendant employer failed to adequately preserve electronically stored information. (2008)
Federal District Court Judge Swain imposed spoliation sanctions on
a company for failing to timely preserve emails. (2008) Judge Swain affirmed Magistrate Ellis holding that a requested
limitation of electronic discovery to 98 individuals and 15 email addresses was reasonable. (2008)
51
The Judges of the S.D.N.Y. have imposed sanctions on companies for:
• Not following up with key individuals to find out what steps were taken to ensure information was preserved.
• Not doing a backup of servers until seven months after the case
was filed.
• Not backing up any of the key individuals’ computers until two years after the case was filed.
• Not instructing the support staff of key individuals to preserve
files.
• Not reminding employees of the need to continue preserving relevant information.
52
“Identify and state the location(s) of each document, including each
electronic document, response to plaintiff’s First Request for the
Production of Documents. For electronic documents, “location”
means each server, backup tape, drive, device, and other hardware
or software system on which the document is maintained and/or
stored, and each server, backup tape, drive, device and other
hardware or software system from which the document can be
accessed and/or retrieved.”
53
Focus on IT & Records Management Topics
54
The text of Rule 30(b)(6) is:
“In its notice or subpoena, a party may name as the deponent a
public or private corporate, a partnership, an association, a
governmental agency, or other entity and must describe with
reasonable particularity the matters for examination. The named
organization must then designate one or more officers, directors, or
managing agents, or designate other persons who consent to testify
on its behalf; and it may set out the matters on which each person
designated will testify….The persons designated must testify about
information known or reasonably available to the organization.”
55
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Records retention policies and procedures
Records management policies and procedures
IT systems and capabilities
Server locations and accessibility of information
Litigation hold notice issuance and follow-up steps taken
Retention periods
57
• Electronic Searching capabilities
• Back-up tape restoration capabilities
• Steps taken in this litigation to preserve electronic
information
• Steps taken in this litigation to search for electronic
information
• Steps taken in this litigation to collect electronic information.
58
Vendor Selection Process Negotiate!
Ad-hoc vs preferred vendors
Define the needs
Recommendations & surveys
RFI / RFP
Interviews, demos & feasibility
studies
Pilot programs
Comparison & evaluation
Term & Termination
Volume Driven Price Points
Direct, In-direct and
Archived Access
Connectivity & Security
Custom Solutions
59
“A responding party may satisfy its good faith obligation
to preserve and produce potentially responsive electronic
data and documents by using electronic tools and
processes, such as data sampling, searching, or the use
of selection criteria, to identify data most likely to contain
responsive information.”
Zakre v. Norddeutsche Landesbank
(S.D.N.Y. Apr. 9, 2004)
Zakre v. Norddeutsche Landesbank
(S.D.N.Y. Apr. 9, 2004)
Leveraging Search Methods:
Target the Mark
“A responding party may satisfy its good faith
obligation to preserve and produce potentially
responsive electronic data and documents by using
electronic tools and processes, such as data
sampling, searching, or the use of selection criteria,
to identify data most likely to contain responsive
information.”
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U.S. v. Michael John O'Keefe 2008 WL 449729 (D.D.C.)
“Whether search terms or ‘keywords’ will yield the
information sought is a complicated question involving the
interplay, at least, of the sciences of computer technology,
statistics and linguistics… Given this complexity, for lawyers
and judges to dare opine that a certain search...terms
would....produce information...is truly to go where angels
fear to tread.” [Defer to experts.]
62
Lorraine v. Markel American Ins. Co. PWG-06-1893 (D. Md May 4, 2007)
“Be careful what you ask for, the saying goes,
because you might actually get it.”
63
Diabetes Centers of America v. Healthpia (S.D. Tex. Feb. 5, 2008)
“...relevant emails in response to Defendants' discovery
request was entrusted to a junior associate... worked with
little or no direction or supervision... [S]he failed to
locate...emails about which Defendants now complain.”
[No sanctions because: “Each party has produced discovery
...in an incomplete or lax manner...”]
Cost Effective E-Discovery Strategies in Wage & Hour
Litigation
Collecting, Preserving, and Producing Electronic Evidence During Wage and Hour Litigation
David D. Rohde (917) 399-7771
March 4, 2012
65
Cost Effective eDiscovery Approaches
• Identification & Preservation
• Sampling Strategies
• Claw Back & Quick Peek Agreements
• Early Case Assessment
• Review Strategies and Predictive Coding
• Proactive Approaches and Cost Savings
• Know Your Information
• Data Maps and Staying Out of the Weeds
66
Litigation costs are skyrocketing, and the process is becoming increasingly complex, burdensome, and risky.
Increasing Data Volume
Escalating Budgets Expanding
Effort
93% of all data is now created on computers initially; most never printed out
E-mails – 4 trillion e-mails per day in the US
Outside legal expenses rose 5.5% last year
Global companies spend approximately 58% of their entire budget on litigation
75% of all global companies will be involved in regulatory or legal action
Global companies face an average of 305 pending lawsuits
67
Typical Cost Progression
68
Wage and Hour Cases
• Because of the nature of the cases, and the nature of the types and
location of relevant data, acquisition costs can be much higher
• Sources of relevant information are often non-obvious
• Custodians and systems of record are often unfamiliar with legal hold
processes
• Identification of data often requires SMEs
• Preservation often presents operational challenges
• Timing is often accelerated
69
Identify and Preserve
• The duty to preserve requires a party to identify, locate, and maintain information and tangible evidence that is relevant to specific and identifiable litigation
• It typically arises from the common law duty to avoid spoliation of relevant evidence for use at trial and is not explicitly defined in the Federal Rules of Civil Procedure
• See, e.g., Silvestri v. General Motors, 271 F.3d 583 (4th Cir. 2001) (applying the “federal common law of spoliation”); Chambers v. NASCO, Inc., 501 U.S. 32 (1991)
• Scope of preservation varies widely
• Anticipation of litigation vs. actual litigation
• Jurisdiction
70
Timing of Preservation
• A duty to preserve may arise or be “triggered” before commencement
of litigation
• The duty “arise[s] not only during litigation but also extends to that
period before the litigation when a party reasonably should know that
the evidence may be relevant to anticipated litigation.” Silvestri v.
General Motors, 271 F.3d 583, 591 (4th Cir. 2001)
• Note this is the state of the law in 2001 and has only been reinforced in a
post-Zubulake world…
71
Identification of Materials for Preservation
• Once it arises, a party must take reasonable steps to preserve “what
it knows, or reasonably should know is relevant in the action, is
reasonably calculated to lead to the discovery of admissible
evidence, is reasonably likely to be requested during discovery
and/or is the subject of a pending discovery request.” Wm T.
Thompson Co. v. General Nutrition Corp., 593 F. Supp. 1443 (C.D.
Cal. 1984)
• Note again, this case is from 1984…Pension Committee, Rimkus, etc.,
keep making this point…
72
Preservation Options
• Hold in place
• May be initially viewed as least costly
• Considerations include:
– Feasibility
– Number of custodians
– Type of data
– Nature of complaint
– Duration of hold
– Custodial self-preservation concerns
• Collect to preserve
• Cost and burden
• Potential for over/under preservation
73
Reasonable, Cost Effective, & Defensible
• Discovery, in general, must be guided by reasonableness and good
faith
• Where ESI is involved, there are also practical limitations due to the
volume, complexity, and practical impacts of preservation on a going
concern – all of which necessarily implicate the proportionality
principles found in Rule 26(b)(2)(C)(iii)
74
Reasonable, Cost Effective & Defensible
• Sedona Conference “Guideline 7 – Factors that may be considered
in determining the scope of information that should be preserved
include the nature of the issues raised in the matter, the accessibility
of the information, the probative value of the information, and the
relative burdens and costs of the preservation effort.” See THE
SEDONA CONFERENCE® COMMENTARY ON LEGAL HOLDS:
THE TRIGGER & THE PROCESS
75
Sample – Look at Some to Infer the Rest
• Sampling can take many forms
• Statistically relevant
• Requestor’s choice
• Judicial/Master’s selection
• Agreement of the parties
• Keywords, concepts, or other search technology
• Extrapolation of results is part art, part science
• Know the data
• Know the business
• Timeframes and frequency
76
Data Mapping: One Investment, Many Payoffs
• Needs to be comprehensive for your purposes, not the IT
Department’s
• Should include the information you need to effectively identify,
preserve, and negotiate the scope of discovery
• Repository name and owner
• Contents
• Coverage (how long/how much information in repose)
• Ease of access and preservation
• Ease of collection and processing
• Form of production
• Required knowledge for Rule 26 Meet and Confer
• Required for SDNY Pilot Program—Complex Cases--2011
77
Sampling & Early Case Assessment
• “Defendant notes that the Advisory Committee Notes for both Rules
26 and 34 authorize the initial use of sampling of sources prior to
production, in order to keep costs at reasonable levels.” Ingersoll v.
Farmland Food, 2011 WL 1131129 (W.D.Mo.)
• The Sedona Conference® Commentary on Proportionality in
Electronic Discovery also supports the concept of sampling to reduce
costs and increase both the efficacy and efficiencies of cost effective
discovery
• Be aware of the science behind the sample, or better yet, get
agreement
78
Early Case Assessment
• Probably as many definitions as there are people discussing the topic
• One common definition: early and advanced searching, culling, and filtering of electronic discovery in order to develop case strategies
• Refers to human and electronic assessments
• Informs preservation, collection, processing, and review
• May inform settle/litigate decision
79
EDRM with a Twist
Technology Assisted Review
Early Case Culling and Filtering
Analytics and Concept Search
Predictive Coding
80
Functionality in “New” Document Review and Early Case
Assessment Technologies
• Analytics and Clustering
• Includes similar document detection
• Includes ability to select text or paragraph and find documents that are conceptually similar
• Can be used for QC (e.g., finding documents that are conceptually similar to everything coded as privileged)
• Can apply clustering functionality to a large group of documents to group and prioritize by concept
• Includes functionality to analyze individual or group to group communication patterns
• Ubiquitous Access
• Provides the ability to securely extend access to other offices
• Provides the ability to securely extend limited access to clients, co-counsel, and other third-parties
• Security
• Allows granular security to the field and functionality level
• Allows for security authentication
81
Claw Back and Quick Peek
• Rule 26(b)(5)(B) Provides procedural framework for the sequestering
and/or retrieval of inadvertently produced privileged or protected
documents from parties to the litigation
• Rule 26 does not alter the substantive law of privilege in the jurisdiction • Does not insulate privileged materials from a potential waiver of privilege
as to third-parties
• See FRE Rule 502 for additional privilege protection/considerations
82
Claw Back and Quick Peek
• Claw Back – Agreement between the parties for return of inadvertent disclosures – no
waiver of privilege
• Quick Peek
– Agreement involves the purposeful disclosure of information, without intending to waive a claim of privilege, with an express reservation of rights to assert privilege at a later point in the discovery process
• These types of agreements/practices can be useful in managing risk, lowering costs, and expediting discovery because they help protect against privilege waiver in cases of inadvertent production
83
Claw Back Agreements & Screening
• Claw back agreements
– These types of agreements/practices can be useful in managing risk, lowering costs, and expediting discovery because they help protect against privilege waiver in cases of inadvertent production
• Screening
– Removes obviously privileged materials by basic searching and sequestering of documents
– In certain circumstances, claw backs and screening may save a significant amount of money because they limit the amount of document review necessary prior to production
• Claw back agreements should be in place before discovery is produced
84
Non-Waiver Agreements and FRE 502
• In general, FRE 502 resolves some current conflicts in the case law
concerning the attorney-client privilege
• The measure seeks to reduce litigation costs typically arising in the
process of privilege review and production
• The rule establishes a presumption against subject matter waiver,
addresses the issue of inadvertent disclosure, provides for
confidentiality orders, and supports party agreements (among other
issues)
85
Non-Waiver Agreements and FRE 502
• FRE 502(a) Disclosure Made in a Federal Proceeding or to a Federal Office or Agency; Scope of a Waiver:
• FRE 502(a) limits waiver of the privilege normally to the communication or materials disclosed, and not to the entire subject matter of the communication.
• FRE 502(b) Inadvertent Disclosure:
• FRE 502(b) clarifies that inadvertent disclosure does not result in waiver when the holder of the privilege "took reasonable steps to prevent disclosure" and "promptly took reasonable steps to rectify the error”.
NOTE: A claw-back agreement does not excuse due diligence!
86
Predictive Coding: A Turning Point for Document Review?
• Cost Reduction:
• Clients want options to reduce e-discovery costs
• Courts are increasingly supportive of well conceived efforts to control
such costs
• FRCP 1 (Just, speedy, and inexpensive…)
• “User” Acceptance:
• Attorneys more accepting of technology
• Productivity tools are showing objective efficiency
• Flaws in current model are increasingly understood
• Judges are encouraging lawyers to overcome their inertia in terms of
using new technologies
87
Predictive Coding—Technology Assisted Review
Where it Fits in the Process
88
• A single expert is assigned to train the review engine (per issue)
• The review software initially selects a random sample of
documents
• The expert identifies any responsive documents in the sample
• The software analyzes the expert’s input and creates a profile for
relevant and irrelevant documents
• The software generates new samples, each time learning more
from the expert’s input
• The process repeats until the software determines it has sufficient
information to scores all of the documents
• The scores are then used to make informed decisions about
what will be reviewed and by whom
How does Predictive Coding Work?
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Prioritized Review Iterative Process Review Tool
Generates Sample Batch
Case Expert Reviews Sample
and Tags
Review Tool
Analyzes Tags & Learns
Review Tool
Continues to Update Model
The Process
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Predictive Coding: Authority and Definition—Per Judge Peck
in the Da Silva Moore Case
• “This judicial opinion now recognizes that computer-assisted review
is an acceptable way to search for relevant ESI in appropriate
cases.”--Da Silva Moore, et al., v. Publicis Groupe, et al
• “By computer-assisted coding, I mean tools (different vendors use
different names) that use sophisticated algorithms to enable the
computer to determine relevance, based on interaction with (i.e.,
training by) a human reviewer.
• Unlike manual review, where the review is done by the most junior
staff, computer-assisted coding involves a senior partner (or [small]
team) who review and code a "seed set" of documents.
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Goals of Predictive Coding: Efficiency and Efficacy
• In the Da Silva Moore case the Court reminded the parties that
computer-assisted review :
• “[W]orks better than most of the alternatives, if not all of the [present]
alternatives.”
• “So the idea is not to make this perfect, it's not going to be perfect.
The idea is to make it significantly better than the alternatives without
nearly as much cost."
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Predictive Coding: One Applied Approach
• “Some systems produce a simple yes/no as to relevance, while
others give a relevance score (say, on a 0 to 100 basis) that counsel
can use to prioritize review.
• For example, a score above 50 may produce 97% of the relevant
documents, but constitutes only 20% of the entire document set.
• Counsel may decide, after sampling and quality control tests, that
documents with a score of below 15 are so highly likely to be
irrelevant that no further human review is necessary.
• Counsel can also decide the cost-benefit of manual review of the
documents with scores of 15-50.”
--Andrew Peck, Search, Forward, L. Tech. News, Oct. 2011, at 25, 29.
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Challenge and Proof
• “[I]f the use of predictive coding is challenged in a case before me, I
will want to know what was done and why that produced defensible
results. I may be less interested in the science behind the "black box"
of the vendor's software than in whether it produced responsive
documents with reasonably high recall and high precision.
• That may mean allowing the requesting party to see the documents
that were used to train the computer-assisted coding system.
(Counsel would not be required to explain why they coded
documents as responsive or non-responsive, just what the coding
was.) Proof of a valid "process," including quality control testing, also
will be important.” --Andrew Peck, Search, Forward, L. Tech. News,
Oct. 2011
• When to discuss?
• Agree in advance, seek judicial approval, argue later?
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The Seed Set
• Seed sets may be discoverable…
• “I'm also saying to the defendants who may, from the comment
before, have read my article. If you do predictive coding, you are
going to have to give your seed set, including the seed documents
marked as nonresponsive to the plaintiff's counsel so they can say,
well, of course you are not getting any [relevant] documents, you're
not appropriately training the computer.”
--(Judge Peck, Da Silva Moore opinion, citing, inter alia discovery
conference of 12/2/11 Conf. Tr. at 20-21.)
• Work product considerations must be addressed…not everyone is in
agreement on this issue!
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Conclusion
• The Court recognizes that computer-assisted review is not a magic,
Staples-Easy-Button, solution appropriate for all cases.
• The technology exists and should be used where appropriate, but it
is not a case of machine replacing humans: it is the process used
and the interaction of man and machine that the courts needs to
examine.
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Basis for the Ruling in the Da Silva Moore Case
• In this case, the Court determined that the use of predictive coding
was appropriate considering:
• (1) the parties' agreement,
• (2) the vast amount of ESI to be reviewed (over three million
documents),
• (3) the “superiority” of computer-assisted review to the available
alternatives (i.e., linear manual review or keyword searches),
• (4) the need for cost effectiveness and proportionality under Rule
26(b)(2)(C), and
• (5) the transparent process proposed by MSL.
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Why it Can Work and Lower Costs
Final Thoughts
• Staging of discovery—get to the most likely sources of relevant
information first—and without prejudice for a second bite—Lowers
costs/saves time
• Rely on your client's knowledge about the opposing party's
custodians and document sources—attorneys need to use their
clients as resource to expedite the process
• Counsel for the producing party is often not conversant with the
best/complete sources of potentially responsive information—you
can’t put forth a credible “Phase I” approach without this knowledge
• Bring a techie to court--ediscovery vendors/experts/attorneys should
be able to readily explain the protocol proposed
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BREAKING NEWS!!!
Objections Taken to District Court Judge and it’s Getting Ugly
