The Problems of Preservation: How Much Evidence is Too Much?

Listen & Download

In today’s digital age, businesses create seemingly infinite quantities of data. And when the mere prospect of litigation looms, current rules require businesses to assume significant costs to store and maintain any data that might be relevant to that litigation. This seemingly boundless duty to preserve, unmoored from our legal traditions, all but abandons the common law of discovery.

At common law, the duty attached only upon the filing of a suit (or when filing was imminent), and generally required only that parties not destroy evidence directly related to litigation. But today’s duty casts aside these originalist common-law pillars—the duty not only attaches earlier, but is broader in scope. What’s more, recent judge-made preservation obligations make obtaining spoliation sanctions far easier by removing the common-law requirement that the spoliator acted in bad faith. Such a broad duty and simple path to sanctions has led, predictably, to over-preservation, placing significant burdens on corporate litigants.

This teleforum dives into this topic, and will discuss whether courts have strayed too far from the historical common law, changing the traditional balance and equity in discovery.  

Featuring: 

Michael Buschbacher, Counsel, U.S. Department of Justice

Suzanne H. Clark, Discovery Counsel, eDiscovery CoCounsel, pllc

Robert Keeling, Partner, Sidley Austin LLP

 

Teleforum calls are open to all dues paying members of the Federalist Society. To become a member, sign up on our website. As a member, you should receive email announcements of upcoming Teleforum calls which contain the conference call phone number. If you are not receiving those email announcements, please contact us at 202-822-8138.

 

Event Transcript

[Music]

 

Dean Reuter:  Welcome to Teleforum, a podcast of The Federalist Society's Practice Groups. I’m Dean Reuter, Vice President, General Counsel, and Director of Practice Groups at The Federalist Society. For exclusive access to live recordings of practice group teleforum calls, become a Federalist Society member today at www.fedsoc.org.

 

 

Greg Walsh:  Welcome to The Federalist Society's teleforum conference call. This afternoon's topic is titled “The Problems of Preservation: How Much Evidence is Too Much?” My name is Greg Walsh, and I am Assistant Director of Practice Groups at The Federalist Society.

 

      As always, please note that all expressions of opinion are those of the experts on today's call.

 

      Today, we are fortunate to have with us Michael Buschbacher, Counsel at the U.S. Department of Justice, Suzanne H. Clark, Discovery Counsel at eDiscoveryCoCounsel, pllc, and Mr. Robert Keeling, a Partner at Sidley Austin LLP. After our speakers gives their opening remarks, we will go to audience Q&A. Thank you all for sharing with us today. The floor is yours.

 

Michael Buschbacher:  Thank you very much, Greg. My name is Michael Buschbacher. As Greg mentioned, I’m an attorney at the Department of Justice in the Environment and Natural Resources Division. Before that, though, I was a litigator at Sidley with Robert where I did an interesting mix of appellate and trial work, and a lot of eDiscovery policy and interesting cases, including one very fun spoliation thing where we caught one of the plaintiffs using Microsoft Word to change the content of email.

 

      Robert is going to lead us off here. Robert, like I said, is a partner in Sidley’s D.C. office, and he’s an expert on many eDiscovery topics and has written a really interesting law review article that a commend to you all called “Sometimes, Old Rules Know Best: Returning to Common Law Conceptions of the Duty to Preserve in the Digital Information Age,” which was in the Winter 2018 issue of the Catholic University Law Review.

 

      Also, Suzanne Clark is going to be presenting this morning -- or this afternoon, sorry. She’s a graduate of University of Florida College of Law and serves as eDiscovery co-counsel -- sorry, serves as discovery counsel at eDiscoveryCoCounsel, pllc, and has a number of credentials and experience in the eDiscovery realm.

 

      The topic for today’s discussion is one that I think is both very important and perhaps doesn’t get quite the attention it deserves among FedSoc types, and it’s eDiscovery and preservation in particular. And one of the reasons why I think it’s been under-looked at is because generally, the scholarship out there has focused on contemporary issues and hasn’t looked historically at how our current regime was developed and what came before the Rule 37(e) world that we live in today.

 

      Robert’s article that I mentioned does a good job of beginning to push back against that, and it raises a number of interesting questions about balancing the need for actual preservation against the increasing burdens of truly enormous amounts of data that defendants -- mostly defendants end up having to preserve, which also increases discovery costs for plaintiffs and has really changed the face of litigation. So with that, I’m going to turn it over to Robert to begin, and thanks, Robert.

 

Robert Keeling:  Sure. Thanks, Michael. Thanks, everyone for getting on the phone today.

 

      So just to kind of set the table a little bit, again, as a partner at Sidley, I represent corporate defendants. Suzanne is who I’ve had the pleasure of litigating with her firm. In the past, I typically represent requesting parties, but broadly speaking, what we both deal with is data. And in particular over the past 20 years, that data, as everyone knows, has been increasing really exponentially.

 

      Traditionally, going back decades or hundreds of years, preserving documents that may be relevant to a litigation meant preserving a folder of paper documents or at most, a few boxes. But that is obviously no longer the case. For modern business, the amount of electronically stored information which we in the industry refer to as ESI has increased really astronomically. And there’s obviously good business reasons for that. So there’s a lot of efficiencies and data reasons that businesses prefer increased communication, increased data.

 

      But when we get to litigation, it creates some issues because it’s not just email, which in and of itself has increased over time. When 20 years ago you might have sent only a handful of emails a day, now the average employee will send or receive hundreds. But you also have the information on their laptop, on removable media like thumb drives, and then of course, information on their phones, social media, and structured data, all of which could be potential evidence for a case. So when you think about preservation, that’s what we’re thinking of, particularly on the corporate defendant side.

 

      So Suzanne probably deals with it as far as your end. That may be a fact, Suzanne, right? But as far as the importance of preservation, you might have a different view.

 

Suzanne Clark:  Right. So we deal with asymmetrical litigation where we’re representing consumers against corporation. And so we’re looking at -- we want preservation so that we can get to the truth and the facts of the case, not end up with not getting our evidence at trial by surprise, protecting citizens, accountability of corporations, even protecting employees of corporations. We want to get the facts. We want to get the data so that we really know what happened. And we want corporations to be accountable for that so that they know that there will be evidence of how they were acting and what happened in a case.

 

Michael Buschbacher:  And the government -- and I should add that I’m appearing today in my personal capacity so the usual caveat that what I say isn’t the position of the Department of Justice, it’s just my own. But the government sort of stands in two places at once. On the one hand, we’re often a requesting party whether that’s in litigation or in an investigation. And we’re also the defendant in a lot of matters, and we have to do our own collections and our own preservation of documents and data. And on top of that, there’s a lot of coordination that has to go on with the various components and agencies that we represent or are working with. So there’s a need both to make things manageable but also to have the tools that we need to find out what happened.

 

Robert Keeling:  Yeah, that’s exactly right. And it creates an issue for the government, but you see both sides from the producing party and the receiving party. And so that’s the point here. We’re trying to get from different perspectives for this discussion. I don't know if Michael or Suzanne want to think about while that’s the current issue as far as the current standards that apply for folks, we can help set the table with that.

 

Michael Buschbacher:  Sure. Really, the reasonable anticipation of litigation standard is ubiquitous now, which requires parties to preserve things that might be relevant or are likely to be relevant to litigation whenever it’s reasonable to expect that there might be a case coming at some point in the future that involves those issues.

 

      I think Robert will get into how that’s changed from how things used to be done, but the upshot of that is there’s a — of the current standards — is that there’s an enormous amount of preservation that happens, even when there is no case that ends up getting filed. And that preservation often begins a long time before any litigation gets filed, even if it ends up being connected to litigation. And often, certainly it’s true in the government and it’s also true with private companies that there are often data preservation policies in place that preemptively require stuff to be preserved and then have various ways of flagging that for litigation hold, if that becomes necessary.

 

Suzanne Clark:  And just from the requesting party’s point of view on preservation, a big theme for us is being on the outside looking in. So what is the law? The law is the anticipation of litigation standard. Well, how was that determined? How was that determined at the opposing party corporation? Was there a litigation hold policy? Was that litigation hold policy followed? Can we even get a copy of the records retention policy to make sure, because we find out down the road if there’s a preservation issue. When you look at the electronic discovery reference model, it’s at the beginning: identification of information sources and then preservation of those information sources. So it’s on the producing party’s -- it’s the onus of the producing party to be doing that correctly.

 

      Well, what I find in my practice, which deals a lot with evidence management on evidence that’s incoming, is that we will be told, “Well, we don’t have any data for this particular custodian because they were terminated, and then we had a six month hold, and then we let everything go because our records retention policy says that we just keep things for six months after somebody is terminated.” So then we’re thinking, “Okay, well, when did you anticipate litigation, when were they terminated, when did the six months run out?”

 

      And there’s an analysis that needs to be conducted to see if the evidence was or was not properly preserved or was defensibly deleted, yet we don’t have the facts to be able to make that assessment. So those are the concerns. So that’s why requesting parties tend to want to maybe overpreserve is because there’s no way for us to make these determinations.

 

Michael Buschbacher:  Right. A lot of that is we don’t know what we don’t know.

 

Suzanne Clark:  Right.

 

Robert Keeling:  Exactly. And so for folks -- I think maybe a lot of people are familiar with the current standard, which is you have to preserve at the reasonable anticipation of litigation. That was made most famous about 20 years ago by a case that there’s a lot of consensus on what it held, which is reasonable anticipation of litigation. There’s not a lot of consensus on how to pronounce it, which is either Zubulake [Zu-buh-lake] or Zubulake [Zu-buh-lah-kay], a decision that involved an EOC employment complaint, the Southern District of New York case.

 

      And there’s a number of reasons why this case — it was a series of cases — but there’s a number of reasons why those opinions ultimately got famous. In many ways, they had the benefit of being the first that were ruling on these types of issues. And broadly speaking, the federal courts tended to then adopt that standard nationally. And it’s now even, at least in commentary, into the federal rules.

 

      What I found when I was doing research is somewhat surprising to me, actually, is that that was not always the case. And just because this is FedSoc, I think I should note as an initial matter, of course, historically, discovery was -- issues of preservation around discovery was available only for suits in equity. So actions at law were typically dependent on oral testimony, and you had to get court order for discovery and actions at law.

 

      But in any event, even in equity, the historical duty to preserve dates back hundreds of years into English common law, at least to the 1600s and 1700s. One of the first reported cases was an English case, the Armory matter, involved, of course, a chimney sweep that found a jewel and took it to a goldsmith. And rather than inspect the jewel and quote a price, the goldsmith fraudulently removed the jewel from the setting and basically gave the setting back to the chimney sweep. Then the goldsmith sold the jewel. And in litigation, the court basically sanctioned the goldsmith and said the value of the jewel should be assumed that the jewel was the highest quality.

 

      And so in the decades and centuries that followed, the English and American courts elaborated on what the contours of the duty to preserve were. And for our purposes in English common law and American common law, the courts held basically that the duty to preserve arose either at the time of the filing of the lawsuit, or at most, when the lawsuit was imminent, which is a very different standard than reasonable anticipation of litigation. And so you see that in the cases that follow.

 

      Just one more case for you, and because it’s an American common law case, of course, it has to do with railroads. It’s called Berthold-Jennings Lumber. And there is an Eighth Circuit case involving rates that a railroad could charge. And there, the railroad was accused of charging higher rates. And it turns out the railroad had originally maintained receipts which could have proved that the railroad was violating these statutory rate provisions, but the railroad had destroyed those receipts in the common course of business. And in the ultimate litigation, the court held no spoliation sanctions should apply because no lawsuit had been filed, nor was there evidence of bad faith. And so it was a common law, basically.

 

      What we’ve seen is a different standard, which in some ways hard to argue against the current standard and say it’s not reasonable because it has reasonable it its name. It’s reasonable anticipation of litigation. But at least from the producing party’s side, there’s a big difference between certainty of, oh, I have to preserve when a lawsuit is filed, when I’ve actually got the summons and the complaint against me or when I know it’s being filed tomorrow versus reasonably anticipating that some type of litigation might be filed against me at some point in the future. So that, broadly speaking, is the issue and the common law distinction from the current standard.

 

Suzanne Clark:  And so, Robert, what you’re saying is they’re taking away the certainty, and it’s hard to figure out what that trigger is because of the subjective analysis of what was happening.

 

Robert Keeling:  Exactly. And so practically speaking, it’s now a gray area. So what may be reasonable to some is not reasonable to others. And so what you see in response, particularly from companies that are repeat litigants, is that they tend to overpreserve. They preserve more data and earlier than they would otherwise need to under the traditional common law standards.

 

      And that relates in costs. That results in costs, not just for storage. And contrary to popular belief, storage is actually pretty expensive when you’re dealing with the volumes of some of these companies. You’re dealing with petabytes of data under storage for litigation and regulatory matters. But then the more data that’s preserved, the costlier it is to process, review, and produce in litigation.

 

Suzanne Clark:  And I think from the requesting party side, we just don’t think about that. I don’t really think that’s a factor or a tool that’s used. Let’s increase the costs of litigation for these corporations. We’re not thinking that far down the road. We’re not thinking of that strategically or trying to use discovery or preservation as a sword.

 

      Really, we just want to get the information so that we have the facts, so that we have the data, so that we can then develop our case, learn our case. We don’t have any other way to learn the case besides discovery. When you have two corporations against each other and they were exchanging information with each other, then you’re probably going to have a lot of the information that you can learn your case from your own client’s data sources. And then yes, you still want to do discovery to see what was happening behind the scenes at the other side.

 

      But when you’re dealing with consumers and you’re dealing with plaintiffs’ counsel in mass torts and things like that, the consumer doesn’t have much data besides social media accounts. And it’s not a part of these attorneys’ practice to be managing data of their own clients. So they have no clue about -- it’s just not on their radar about the costs. What we want is we want to get the information. We want to make sure that everything was done defensibly and appropriately and reasonably to get us what we’re entitled to in the scope of discovery.

 

      So I say this, Robert, because I want to say is there another way to solve this with agreements between the parties so that you can build in certainty and we can feel, on our side, more secure that we’re going to get what we need? And what I’m bringing up is later on our topic list, but preservation orders, preservation agreements, things like that.

 

Robert Keeling:  Yeah, exactly. So for folks who might have experience with this, which is what Suzanne’s talking about, is that parties can basically contract themselves and take themselves in some ways out of the gray area of preservation and come to an agreement about what data should be preserved in a suit and what data should not. And so it does provide certainty to both parties. So the plaintiffs would then -- well, the requesting party would know what data -- would have comfort that data that’s relevant to their suit is being preserved and that the producing party, the defendants, would have comfort that information not relevant to the preservation agreement could be deleted. Those are the advantages.

 

      For my side, it’s rare that I enter into preservation orders, and I certainly would not bring it up in the first instance. The reason -- two reasons. The one I don’t bring it up is because typically if I ask a plaintiff’s counsel, “Well, hey, can we get an agreement about what needs to be preserved?”, inevitably the answer is, “Well, you should preserve everything.” That’s their starting point, and then you have to negotiate from there.

 

      The other issue, at least for me, with preservation agreements is that they’re typically not agreements. They’re entered in as an order. So the court basically blesses the agreement with an order. So what that means is if we’re outside the agreement or litigating about preservation and what should have been done or what shouldn’t have been done, at least I have remedies either to the common law or to Rule 37 as far as like safe harbors for me.

 

      If it turns out that my folks, often times by accident, didn’t preserve data that was subject to the preservation order, well, now I’m looking at a show cause. And so it turns up the temperature for me for if I get outside of the preservation order. I don't know, Suzanne, you probably have a different experience with them and maybe a more positive one on your end.

 

Suzanne Clark:  Well, I guess it’s just about the act of and just trying to solve this problem that you’re identifying here, which as an eDiscovery professional and understanding information governance because that’s my job to bring that knowledge to plaintiff’s counsel, plaintiff’s counsel for consumers who don’t have a client, they can pick up the phone and call the eDiscovery department, and they come to me to teach them that. So I understand this idea of just mounds and mounds of enormous amounts of data and that that is a problem, but it’s this residual problem that comes with trying to solve the problem of losing information.

 

      And when you look at asymmetrical litigation and the consumer corporation, and with Zubulake, employee against the corporation, and I read your law review article and you talk about equity and you talk about the burden being on the corporation and the costs and all of that being on the corporation, well, yes, but the sides are not equal in burden or in resources or in duty.

 

      So corporate defendants, they are out there. They are manufacturing, trading, they’re part of the economy, they’re part of the marketplace, and they’re getting a benefit from being in that marketplace, and so there are costs to that. There is public policy that’s in place that says let’s protect the little guy who doesn’t have a lot of data, yes, but they also don’t have a lot of resources to protect themselves, so we need to protect them.

 

      And when you get plaintiff’s counsel who are willing to come in and willing to invest up front in a matter, they want to know that they are going to get everything they need to prove their case and thus protect these consumers, who, if you think about preservation in something like a medical device case, as soon as you’re implanting a foreign object into a person’s body, you could argue that there are probably going to be lawsuits. If you’re implanting these in thousands and thousands of consumers and patients, there probably will be a lawsuit someday.

 

      You’re doing the testing on these devices well, well in advance of that. So a surgeon implanting something versus the testing that was done, and then you have to go through the FDA and regulatory and all of those processes, you’re going to need that evidence to find out if anything was done wrong once the lawsuit is filed. So that’s my perspective on preservation and the need to keep this data.

 

Michael Buschbacher:  There’s a dysfunctionality -- I think there are a couple dysfunctionalities that are getting tossed around. And I think it’s important to highlight that one of the problems is that when you’re spending someone else’s money and there’s a benefit that you might get from it, the normal cost-benefit analysis you would do goes out the window. So if you’re looking at preserve X, Y, or Z thing, well, chances are that it might be that it’s very unlikely that you’re going to find anything of relevance there. But nevertheless, it has to be preserved and collected and processed.

 

      Back when I worked at Sidley, I worked on a case where I think in total it was over 14 million documents that were first preserved — many more were preserved — but first preserved then processed, reviewed, and then sent out. And then there was a trial, and I think it was around 50 documents got used. That kind of ratio seems to suggest that there’s just a dysfunctionality in spending other people’s money. But as you’re saying, Suzanne, there’s this --

 

Suzanne Clark:  -- And I don’t disagree. Absolutely, that is a great argument. And on a practical level, what we say that when we’re at a meet and confer, and I’m just really practical, hands-on in my practice, is let’s have transparency. If you’re transparent with us about what you’re doing, we don’t want a data dump because it does cost us money to review also. It’s different, but it still costs us money, including evidence and early case assessment. And assessment evidence costs us a lot of what we call tech time dealing with rebuilding databases and things like that, identifying gaps, identifying holes, so that we can then go back and say we don’t feel confident you did what we wanted you to do. So there are costs on the receiving party’s side as well.

 

      But what we say is let’s be transparent. Let’s work out how you’re going to be going through this. Let’s see if we can save you money. We don’t care -- we’re okay with you saving money. Just let us know how you’re doing this and let us know your processes so that we can be sure we’re getting what we want. And I know what you mean because Robert has talked about when his opposing counsel maybe doesn’t understand eDiscovery and they want him to preserve everything. You may be sending over this beautiful production that fits on the shelf because the other side doesn’t even know how to go through it once they did it. And so that matters too, is who your opposing counsel is and things like that.

 

Robert Keeling:  So I think from -- it’s all very good points. From a producing party’s perspective,  what I would say is if there’s a concern from the plaintiff that there may be an issue with loss of information or loss of data that might be relevant to your suit, well, you have a remedy for that which is file a complaint. And then we can litigate that, and then we can test the viability of the pleadings and the like.

 

      And what’s different is you wait. You might send a preservation letter, which I tend to think are legal nullities. There are some magistrate judges or district court judges that have disagreed with me. But there could be months or years that pass before the filing of the complaint. And then after the filing of the complaint, then there’s this lookback period about, “Well, I sent you a letter nine months ago. I’m assuming you moved heaven and earth to preserve data in response to my form letter.” And so I guess that’s the point of the common law approach is that plaintiffs are not without remedy. They could avail themselves of the remedy that the law allows, which is to file a complaint, and then the preservation standards would attach at that time.

 

Suzanne Clark:  Yeah, and that’s a whole other strategic issue with preservation letters, and, oh, is it malpractice not to send a preservation letter and to go ahead and make sure preservation’s happening before you have a chance to file your lawsuit? And then also, the idea -- I’ve talked to colleagues about this. They get one of those boilerplate preservation letters. They’ll just send a response letter and say, “This is what we’re going to preserve. We’re going to preserve this date range,” just identify the scope of preservation in a counter letter so that that other letter can never be used against them. Like you said, it depends on the judge and the court whether or not -- how much weight’s going to be given to that. So there’s these practical things you can do to alleviate that risk.

 

Robert Keeling:  Yeah, totally agree. And then I think, again, from the producing party’s perspective, just to take off what Michael was saying, is that I think when I’m involved in these types of discussions, the discussions around preservation deal with typically the preservation of information, which, of course, is different from the preservation of evidence. So the evidence may be contained within that information and data, or it may not. And it may be from wholly other sources or sources that were properly preserved after the filing of the complaint. But it really is an exercise of information that may contain evidence, and we don’t know because we don’t have it anymore. So it’s a guessing game with 20/20 hindsight.

 

      When I think everybody understands ultimately, like the point that Michael was making, is you’re preserving 10 million documents, but everybody knows only 500 of them are going to be deposition exhibits and only 50 to 150 are going to be trial exhibits. So the other point here is that if you’re thinking about the common law standard about preserving only when suit is imminent or litigation is filed, at least in my view, you’re more likely to focus on what’s actually important and what is actually going to be the evidence at trial.

 

Suzanne Clark:  But you’re also getting from -- when you’re assessing a data collection and building your case and building you order of proof as a plaintiff, you’re not just looking for your trial exhibits. You’re looking for information about who the witnesses are and who your opponents are going to be, who your custodian should be if you feel like they weren’t all identified.

 

      And so a lot of information in eDiscovery you can get from viewing large quantities of data and running analytics on it, taking large quantities of data and clustering terms, looking at date ranges, looking at spikes in date ranges, having a tool that tells you who was talking to who when, were they conversing with each other after hours, doing sentiment analysis on the data to see where there were contentious relationships or arguments were being had or things like that.

 

      So while yes, when you’re holding up the document or projecting your document at trial, that’s one thing, but there’s so much to be obtained from data that isn’t actual individual documents that if you were using modern technology to assess the data -- so our data now is created with technology, so we need to have tools to assess our evidence, technologically sound tools to assess our evidence as well. You can get a lot of information from large quantities of data that you couldn’t if it was really narrow.

 

Robert Keeling:  Yes, I hear that. I think from the producing party’s perspective, they would say that that analysis and the ability to analyze that the burden to, of course, preserve, produce that data is huge. And the benefit from the analysis of large data sets is typically not known before you get the data that goes into your “you don’t know what you don’t know.”

 

      But the costs tend to be more certain, and we know they’re big. And right now, those costs are typically borne by the producing party. And I haven’t yet had a plaintiff offer to pay for my preservation costs.

 

[Laughter]

 

      So it does create, as Michael said, some disincentives or misincentive from the parties there.

 

Michael Buschbacher:  One of the things we haven’t talked about yet that I think is an important part of the whole mix is how spoliation factors into these incentive structures. And Zubulake  tried to move the needle towards making it easier to get sanctions, and since then, revisions to Rule 37(e) I think pushed it back a little.

 

      It seems to me that because it’s very hard to police bad behavior, this is an area where harsh sanctions are actually a good idea because when you have something that is hard to find examples of or hard to suss out, when you do find it, if you come down with a very heavy hammer, that changes the calculus for potential bad actors in the future. I’m just curious for both of your thoughts on how that factors into thinking about how to minimize overpreservation while making sure that you’re not getting shred parties and other kinds of inappropriate destructions of evidence.

 

Robert Keeling:  Suzanne, do you want to go first, or do you want me to go first?

 

Suzanne Clark:  Sure. I was going to ask you.

 

      So when it comes to practical aspects of how does the law and spoliation law impact my actual practice, whenever we are making some sort of discovery motion to the court from our point of view, whether that’s motions to compel or spoliation or anything like that, we’re not just thinking about, okay, let’s analyze the case law. We’re also thinking about, what’s the practical implication of this? How much time is this going to take us? What’s the opportunity cost here? How else can we solve this problem? What is the judge going to think about us? How is this going to turn out for us in court? Just because the law looks like it might be in our favor and we think we could win this motion, there’s always the risk that we might not.

 

      So we balance that with, okay, their data missing -- we’re missing these custodians. They tell us they terminated them and that they defensibly deleted their accounts. Okay, are we going to take our time to go to court and be outward facing on it, or are we going to take the data that was provided to us and that was produced to us from other custodians and try to rebuild and recreate data and do an evidence-based tactic for this?

 

      So I don't know if that’s exactly what you were asking, but because I know Robert’s answer and what the producing party perspective is, but just from a requesting party, that’s my perspective on spoliation. It’s do we want to duke it out in court? Can we prove this? How hard is this going to be? How much is this going to cost versus is there a way to get what we need without having to go that route?

 

Robert Keeling:  So at least on a producing party, the changes to the federal rules in December of 2015 were helpful, but they don’t get us fully back to the protections of the historical common law. Rule 37(e) is still -- it doesn’t have bright lines. It just says — I’m paraphrasing — but if ESI should have been preserved in the anticipation or conduct of litigation, because a party failed to take reasonable steps to preserve it but didn’t, then there’s these steps.

 

      So in some ways, it somewhat -- the word anticipation of litigation is in 37(e) now. It’s not in Rule 26 or otherwise, but in some ways, the rule could be read to adopt a modern common law standard. But while there are protections, there are still no bright lines about how when the duty attaches and the timing of that, and then what is reasonable versus what is not reasonable, and what is reasonable steps to preserve information. So it’s not just anticipation, but it’s also when does a party anticipate litigation.

 

      But this phrase of reasonable steps now in Rule 37(e), of course, it’s the same problem because, again, while the word reasonable is right there, that’s kind of meaningless when you’re actually faced with a set of facts and trying to make decisions about what information to preserve versus what information not to preserve. And still, I think many -- at least corporate entities are erring on the side of preservation, a lot of times, when they didn’t need to. So do others have final thoughts, or should we open up for questions?

 

Suzanne Clark:  I think I’ve said everything I needed to say.

 

Robert Keeling:  All right. How about questions?

 

Greg Walsh:  All right, we’ll go to questions now. We’ll go to our first question here.

 

David Emerson:  It’s David Emerson, The Federalist Society chapter in Berkeley. I’m usually on the receiving end of the discovery requests in most of my experience. And I’d like to get thoughts from the panelists —and I do appreciate you’re both very seasoned and you’re quite astute — about the impact that’s shifting to the prevailing party approach to litigation costs or the English rule versus the American rule of cost shifting in general, and whether or not either of you have experience either directly or indirectly with jurisdictions that have taken an approach and whether they’re still seeing this kind of vexatious problem with the high expense of discovery and the issues with preservation.

 

Robert Keeling:  Sure, I can go first. I have experience with this just with my -- in multinational litigation and working with my colleagues in our U.K. office. I have been involved in suits in the U.K. and helped on the eDiscovery aspects of that. And in one of those matters, we were able to get costs. It wasn’t as much costs as -- because we prevailed, it wasn’t as much costs as we would have liked. But it was -- I think it does act as a deterrent in some respects, certainly against more of the frivolous or vexatious type of litigation.

 

      And from my perspective, we don’t even need to probably go to the full English system or U.K. system. For me, certainly in big cases, for me even only recovering five percent of my costs I think would give more than sufficient skin in the game to the other side, partly because my cases tend to be larger. But even five percent, I think, would really align interests and make the parties very reasonable.

 

      Just one more anecdote. After the rules were passed, I was able to have the -- I had already given discovery. Plaintiffs wanted more. I said no. We took it to magistrate. The magistrate said, “Well, plaintiffs can have more discovery, but given all the discovery that they’ve received so far, they have to pay for it.” Well, you’d be shocked and surprised about how reasonable the plaintiffs suddenly became as far as the scope of the supplemental discovery as compared to the original discovery request. So I do think it matters and I do think it could be helpful, but I think even, really, a percentage would have the same effect. Suzanne, you probably have a different view.

 

Suzanne Clark:  Well, I think that there are factors to be weighed and balanced, and that if you look at -- if you weigh and balance those factors that it is appropriate at times to shift costs and share costs. And I think it does -- I’m a big proponent of accountability and accepting and sharing burden like with transparency and understanding now. And the factors that you’re going to weigh are who has control over these costs?

 

      There is a cost shifting analysis in the Zubulake  opinion. And she goes through it there. And I think that that makes a lot of sense. That’s how we practice law is we say what’s equitable, what’s right here, look at all these factors, look at ability to pay, look at who’s in control of the costs. If we’re talking about doc review or something like that and the producing party is saying, “I want to you to pay for some of my doc review,” and then they’re using partners and associates to review documents instead of contract attorneys, all of these things need to be weighed.

 

Robert Keeling:  That was a good question.

 

Suzanne Clark:  Yeah, such a great question.

 

Greg Walsh:  It looks like we don’t have any questions right now in the queue. Would any of you like to give closing remarks? And maybe we’ll wait for a question to pop up. If it does…

 

Robert Keeling:   Sure. I’ll give one remark in the sense that I’ve had -- to Suzanne’s point, there are ways where this can be done cooperatively and ways that can reduce costs. I’ve litigated with Suzanne’s colleague on a medical device case before, and it was all very collegial and constructive.

 

      The issue, perhaps, motivating my law review article is that’s not always the case, certainly not always the case in my experience as well, personal experience. And the issue with setting broad rules is to try and capture a set behavior for as many cases as possible, and then at least from my view, the historical rule provided more certainty, certainly to producing parties, and so therefore at least should be given consideration for going forward.

 

Suzanne Clark:  Thank you, Robert. That was nice of you. We do try to cooperate and be transparent, and the way I see it is when it comes to data and evidence, it’s very black and white. It’s very fact based. And I think that with eDiscovery attorneys, you can get a lot of cooperation and transparency because both sides understand that. If we really get to the data and the facts, we can find a way to make this work. We can find a way to control costs. We can reduce the number of custodians. We can do a sampling. There’s just so many ways that if you work together, you can control the costs of the data, this non-merit based side of litigation.

 

      And I think a big part of that is bringing in people who understand data because on either side, if you’re dealing with somebody who doesn’t have competency in eDiscovery, if there’s a producing party or you’re dealing with a side who says, “I want everything,” because they don’t understand, or on the receiving party, if we’re dealing with people who don’t understand how to properly collect metadata and process it, and we’re getting all these blank metadata fields, and we’re having to go back and we’re having to ask for things to be redone, it can be very messy and time consuming and expensive. So when you get knowledgeable people on both sides who really understand electronically stored information and evidence and who can work together and are allowed to work together and not use it as a sword, everybody comes out better in the end.

 

Greg Walsh:  So we’ve actually gotten two questions in the meantime if you’d like to take them.

 

Robert Keeling:  Sure.

 

Suzanne Clark:  Yeah.

 

Greg Walsh:  Great.

 

Caller 2:  Yeah, good afternoon. Fascinating topic. I’m sorry I didn’t get a chance to read the law review article yet, and I apologize if you’ve covered some of this. There’s a phrase in our cloud-based world now to what extent some of these cost considerations could mess with interesting privacy implications, given how much information has already proceeded to be contracted out, stored by big data and/or maybe collected on us, and [inaudible 46:52] by the firms and so forth, not entirely with their consent. And I’m just curious what your prospective perspectives on that might be.

 

Robert Keeling:  Sure. It’s a great question. So in many ways, the move of data to the cloud, it’s kind of the same thing we’ve experienced 20 years ago just all over again where there’s innumerable business reasons for moving data to the cloud. It’s cheaper, it’s faster, and there’s a lot of business benefits. As a result, more data is being stored. And so it results in even more and more data being subject to litigation. And so you have those downstream costs of processing and review and production.

 

      And to your point about privacy, that is certainly the case. There is not a sufficient focus on the burdens of protecting privacy by producing parties, some of them who have obligations to do so, a pharma or medical device company may have obligations to protect PII. And that can be very difficult in a litigation and very expensive. And so there’s -- it does create a lot of business efficiency use, but it can create some complications in terms of preservation, certainly.

 

Greg Walsh:  Let’s go to our next question now. Caller area code 703, you have the floor.

 

Mike Daugherty:  Hi. This is Mike Daugherty. I’m involved in some civil matters, one of which was a qui tam in the Southern District of New York where everyone knew, and everyone still knows, that the whole devil is in the data. There is no case if we don’t get our hand on the data, and the entire case is proved if we get our hand on the data; therefore, in a civil matter and in the qui tam, and other cases.

 

      Opposing counsel, of course, did anything they could to stay on the football so it didn’t turn into a nuclear bomb. And the Justice Department was not interested, and the judges were not interested. And as a matter of fact, I think the Justice Department wasn’t interested because if it blew up, it would kind of blow up on them as well.

 

      So I’m curious about what you see as far as judicial discretion in killing eDiscovery access because we actually would have paid for everything because I had insurance money that would have paid for all their costs. But they just weren’t going to let it out no matter what. And the judges and the Justice Department went along to get along, and so now we’re at the appellate process. So that’s my question.

 

Robert Keeling:  Sure. Probably you found a receptive audience with Suzanne. I don’t know. Suzanne, do you want to respond to that, then I can? Or I’m happy to respond.

 

Suzanne Clark:  Go ahead.

 

Robert Keeling:  Sure. So what you say, I certainly hear from requesting parties where there’s the view that the litigants on the receiving end are not fully producing sufficient information or any information that they should produce in the suit. And that may be added in the qui tam situation by the government with their attention or lack of attention that they want to spend on a particular case.

 

      And I think certain -- so it’s hard because certain cases, obviously, it’s well warranted. And there may be some gamesmanship going on, but at least as the producing party, my issue is a number of the rules that have been made are somewhat anecdotally based. And from my perspective, trying to comply with these requests and counseling companies who are trying to do the right thing and comply with their obligations, I just see a lot of costs on the other end where there’s a lot of money being spent to preserve and produce for data that’s never looked at and never used.

 

      And so what you’re articulating is on the other side of the coin, which is the other side going to great lengths to avoid production, which creates its own issues. And I think the traditional response is that’s what the judge is for. But I hear what you’re saying is that the judge was not interesting in perhaps giving relief, which creates, certainly, a frustration. But for me, I guess the difference is the individual case versus the policy level. And at the policy level, certainly from a producing party side, I see less preservation being favorable from a societal point of view rather than greater preservation.

 

Suzanne Clark:  And Robert, what about this idea that Mike’s trying to take away the cost issue? Clearly, there’s other reasons that they didn’t want to produce besides just cost. So does that impact judges? If you’re going in to say -- because we don’t normally to that. [Laughter] We don’t normally say, “Well pay for it all.” But there are so many other factors besides just cost.

 

Robert Keeling:  Right.

 

Suzanne Clark:  I don't know how much that relieves or changes the story if you’re willing to pay for it.

 

Robert Keeling:  Yeah. No, I think --

 

Suzanne Clark:  -- We never offer that.

 

Robert Keeling:  Oh, I know. I think the answer to that is my favorite eDiscovery response, which is, “It depends.”

 

Suzanne Clark:  Right.

 

Robert Keeling:  And there’s some cases where the question on production versus non-production is really a cost issue, and so therefore, the offer to at least assume some or all of the costs should resolve the issue. And there’s others where there’s collateral reasons why you wouldn’t want to produce that is separate from costs.

 

      And there’s not a lot of court decisions on this. There are one or two that say, well, look, the offer to assume the costs is relevant but not determinative. But unfortunately, there isn’t a lot of -- because it’s not done in normal courts, there’s not a lot of case law to provide clear guidance about what should be done in that situation.

 

Michael Buschbacher:  It seems to me, just as a general observation, that it’s unfortunate that we don’t have more judicial engagement generally in discovery. And we have magistrate judges, but it seems like they’re not interested in doing discovery things either, which I get because it can be messy and boring. But I think that’s one of the ways in which a lot of these things can be addressed is by building a body of case law and not just having unguided discretion.

 

Robert Keeling:  Yes, I agree.

 

Greg Walsh:  Okay, I’ll offer a call for any last closing remarks. You already gave excellent closing remarks about ten minutes ago, but if anyone wants to add anything before we close out, go ahead now.

 

Suzanne Clark:  Thank you very much for inviting me to be a part of this. I really enjoyed it.

 

Robert Keeling:  Yes, agreed. Thanks, everyone.

 

Michael Buschbacher:  Yes, thank you.

 

Greg Walsh:  Thank you all. And on behalf of The Federalist Society, I want to thank you all for the benefit of your valuable time and expertise today. We welcome listener feedback by email at info@fedsoc.org. And we’ll have another teleforum call here in 30 minutes back at the same number on the Trump v. Mazars and Trump v. Vance cases that came down today. Thank you all for joining us today. We are adjourned.

 

[Music]

 

Dean Reuter:  Thank you for listening to this episode of Teleforum, a podcast of The Federalist Society’s Practice Groups. For more information about The Federalist Society, the practice groups, and to become a Federalist Society member, please visit our website at www.fedsoc.org.