Extreme Makeover

Undoubtedly, by this time next year, we trial lawyers will be forced to confront changes in the rules that govern discovery -- changes that may well curtail our ability access electronicallystored information ("ESI") in federal court cases.

Significant amendments to the Federal Rules of Civil Procedure governing discovery of ESI were unanimously approved on September 20, 2005, by the U.S. Judicial Conference, the policy-making arm fo the federal judiciary. They face only two more obstacles before taking effect: The U.S. Supreme Court must approve the new rules and transmit them to Congress for adoption. Assuming no changes are made-and chances that Congress will change the amendments are thought to be extremely low-the electronic discovery rules will take effect on December 1, 2006.

The ESI amendments were more than five years in the making. During that process, a chasm revealed itself between those who believe the existing paper-based rules have proven to be sufficiently flexible to deal with issues revolving around ESI and those who believe ESI raises issues so unique and so different from paper discovery that they could only be addressed by revising the "architecture of discovery rules". For example, here is the testimony of then President of the Association of Trial Lawyers of America, Todd Smith, at one of the public hearings on the amendments:

Members told us, and they appear to be telling the committee as well that they believe the present federal rules generally work quite well for all kinds of discovery, even in complex cases, and need little, if any, change. They don't believe that the proposed amendments would improve federal practice. They believe that, if adopted, these proposals would invite additional discovery abuse, give corporate litigants procedural and substantive advantages beyond those they already enjoy, and continue what we feel is a steady erosion of the right to discovery.

Todd Smith, Testimony before the Committee on Rules of Practice and Procedure of the Judicial Conference of the United States, February 11, 2005. Similarly, Craig Ball, a long-time trial lawyer from Texas and trained computer forensic expert, testified at the same public hearing that "I honestly do not like the twotier [discovery proposal]. I think that it gets us no further down the road. I believe the system is not broken". Craig Ball, Testimony before the Committee on Rules of Practice and Procedure of the Judicial Conference of the United States, February 11, 2005. Yet, at some point in the rule-making process, "the consensus appeared to shift in favor of some recognition with the federal rules that electronic discovery is a unique phenomenon", according to Ken Withers, a senior attorney at the Federal Judicial Center. Quoted in "EDD Rules: The Great Debate", Special to Law. com".

As you know, the present federal rules employ what is commonly called a "two-tier" system of discovery"; that is, they distinguish between what is and what is not relevant to the subject matter of the action. An amended Rule 26(b)(2) will further bifurcate discovery by separating ESI into two categories. "Reasonably accessible" information must be produced according to the same rules as tradition paper discovery, but the second tier of information -information that is not "reasonably accessible because of undue burden or cost" to the responding party"-requires a requesting party to get a court order and make a good cause showing. The amendments offer no definition of what is "reasonable accessible". However, the report of the Judicial Conference provides examples of what is not reasonably accessible under current technology: "deleted information, information kept on some back-up tape systems for disaster recovery purposes, and legacy data remaining from systems no longer in use". Report, Page 30-1. During the comment period, concerns were expressed that this provision would lead corporations to make information inaccessible in order to frustrate discovery. The Judicial Conference's Report addresses this concern by stating "[m]any witnesses and comments rejected the argument that the rule would encourage entities or individuals to "bury" information that is necessary or useful for business purposes or that regulations or statutes require them to retain". Report, Rules App. C-44-45.

The most far-reaching change is the amendment altering Rule 37. The amendment creates a so-called "safe harbor" for parties who accidentally delete requested information. The new Rule 37(f) provides that "[a]bsent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing ro provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system". Again, the amendment introduces new concepts and leaves them undefined. You can expect "absent exceptional circumstances" and "good faith operation" to be subject to much judicial interpretation and case law development.

During the comment period, there were great concerns about a possible relationship between Rule 37(f) and Rule 26(b)(2). Would the addition to Rule 37 insulate the routine destruction of information on sources a party identifies as not reasonably accessible? In response, the Advisory Committee revised the notes to both Rule 37 and Rule 26 to make clear there is no necessary linkage between these rules. So, the Rule 37 (d) proposed Notes state that good faith may require preservation of information on sources a party believes are not reasonably accessible under Rule 26(b)(2).

One change that should be welcome to us is the emphasis on early preparation for electronic discovery issues. The new Rule 26(f), for example, requires a discussion of ESI during parties' discovery-planning conferences. As outlined in the proposed Note, discussions between the parties might include the form in which the ESI will be produced, how accessible the information is, the time period in which the information will be produced, and the preservation of any ESI that may be deleted or overwritten in the system.