By Cary J. Calderone, Esquire
During a recent lull between my legal business and document retention consulting, I visited my nearby Federal Court for an afternoon’s entertainment and to once again witness live the trench warfare litigants know as discovery disputes. I sat and observed a few discovery and case management hearings and in addition to being thoroughly entertained I found I had some very interesting things to report to those who would like to be prepared should litigation or a government hearing come their way.
Federal Court is still run as a dictatorship (notice I did not use the word benevolent as an adjective before dictatorship). For example, one judge explained that if there was a discovery dispute between the parties and the parties could not work it out themselves, he would allow them to file a joint letter no longer than 4 pages in length describing their respective arguments and then he would decide the outcome and which party would be sanctioned. I could not help but wonder what this judge might be like on a bad day after somebody perhaps submitted a 6 page letter to describe their dispute.
In another matter, lead counsel sent in a surrogate or “pinch-hitter-attorney” to take his place for the case management hearing. This resulted in a visibly irritated judge and an immediate issuance of an Order to Show Cause as to why that absent attorney should not be sanctioned. Ah, I remember what it felt like to appear in Federal Court…even as I quietly sat in the audience I started to feel a little of that old familiar stress in the pit of my stomach.
Much to my chagrin, I did not get to hear the arguments in a big discovery dispute over disclosing information about document retention policies and litigation hold practices because the parties were sent out like school children and told not to return to the judge until they could learn to get along and share their toys properly. In other words, when there were “issues” of contention presented by opposing parties, the judges immediately sent them off to “meet and confer” in the nearest available conference room. We are talking about seasoned, confident and high-priced attorneys getting ordered about and when they scurried out of the courtroom, one could not help but imagine that if they had tails, they would be drooped down between their legs like a family dog that had just been sternly reprimanded and sent off to the kennel.
If the end result of the hearing was that the Judge determined a follow-up hearing/conference was necessary, it was scheduled for 10 days out. Not a lot of time.
Now that you are more convinced than ever that you need to be prepared to head into litigation, I noticed one additional item that may serve you well when you undertake to map your company's electronically stored information. There is no set format required for this procedure. Some find it easier to work with word-processed documents. Others prefer to prepare spreadsheets and others might run a report from a database. After reviewing approximately 60 pages of the moving and response papers to see how these particular disputes concerning disclosure of retention and compliance policies would be argued I noted that they discussed transferring information between the parties via "spreadsheets." So apparently spreadsheets were the preferred format for this large case, and might serve you well if you are searching for a format for your own company's data map. Of course this does not mean you do not need to seek out your own local counsel to make sure they are happy with your format. After all, they are charged with the affirmative duty to become “familiar” with your computer systems so that they do not mislead the opposing party and the court when they propose discovery scope and methods.
Could There Be Even More Lessons?
The only hope for a party not entirely prepared to discuss the what, where, how much and the protection and collection of their discoverable material is that the other side is equally or preferably worst “not prepared.” Otherwise, if sanctions don’t immediately issue, Rule 30(b) (6) depositions will be scheduled expeditiously to find out specifically who knows where to look for discoverable material and how it is and will be protected from alteration and deletion. Although I did not witness a party getting sanctioned, sanctions were frequently mentioned. There was a study recently that found sanctions and/or inappropriate discovery conduct was found in almost 25% of cases of their survey sample. I don't need to run down a list of million dollar discovery sanctions here...a simple Google search of "million dollar discovery sanctions" will provide you with ample examples and words like "continuing trend" will often be found in the articles.
It also became apparent that companies contemplating their retention plans and policies need to understand better (especially if they have not previously spent time in Federal Court) that if you try to take an easy way out and present minimal information and hope for the best, there will be another high-priced lawyer or team of lawyers there to expose your efforts to the judge. And, if the judge is persuaded you have not taken your discovery obligations under the Federal Rules absolutely seriously, you will be in serious trouble. Federal judges were never known to have an abundance of patience. And now, the Federal Courts are extremely understaffed and at the point where one judge recently quit his post on the Federal bench to take a position with a state appellate court. I had the distinct feeling that the Judge relaying this story from the bench completely understood and related to the motivations of the defector. If you don’t believe this is an accurate observation please look at the size of the discovery sanctions being handed down (did you perform that Google search mentioned above?) and rethink your position. Defenses of negligence, oversight and malfunctioning technology have not saved litigants from multi-million dollar sanctions from mishandling their electronic discovery and those defenses will not work for you either. Especially now that with every new headline-grabbing sanction reported it makes it even more difficult for you to claim ignorance of the consequences.
As an attorney who appeared in Federal and State court many times to argue discovery motions, it was really fun to be able to listen and observe for an afternoon, and not have to think about making my own arguments on behalf of a client. It made me reflect about many companies I have worked with as legal counsel or as a consultant. Without question, some companies from my past would be prepared and would be easy to represent during discovery proceedings. Then there were those I would prefer to refer to other counsel rather than represent them in a crisis-reactive-mode to dig them out of an otherwise avoidable discovery mess. On balance, the most important lesson learned from my afternoon of observation to relay to you can best be described by the motto of the Boy Scouts of America, “be prepared.”