Forensic Update

Reflections on information management within the legal and regulatory arena

Archive for March, 2011

Litigation Holds, Novel Arguments, and Great Expectations…

Posted by Johnny Lee on March 30, 2011

Hard DriveMuch has been made of recent case law that seems to prescribe a very particular set of steps that parties must take to ensure that potentially relevant evidence is not damaged.  Indeed, courts often work to ferret out “good faith” dealings among parties wrestling with the digital haystacks of electronic discovery (q.v., Courts expect affirmative steps during Litigation Holds and More data on Litigation Hold failures for more details on this).

An interesting case from late 2010 highlights just how closely some courts are scrutinizing counsel’s obligations to both initiate evidence-preservation efforts and to monitor that preservation throughout the litigation lifecycle of a given matter.  In Am. Gen. Life Ins. Co. v. Billard, 2010 U.S. Dist. LEXIS 138570 (N.D. Iowa Dec. 29, 2010), a defendant insurance company sought to obtain details related to both the nature and extent of the Plaintiff’s litigation hold protocols.

Plaintiff’s response was both curious and bold.  Conceding that there was no litigation hold issued and that counsel had, in fact, received but not reviewed the company’s record retention policies and procedures, counsel proceeded to tell the court that neither of these may be important because the Plaintiff employed a “comprehensive method” for preserving electronically stored information (“ESI”).

Unfortunately (at least for followers of this particular arena of case law), the court punted on the question of whether “comprehensive method” of ESI preservation could obviate the need for a litigation hold letter (and accompanying monitoring by counsel).  That said, the court did require Plaintiff to either produce any litigation hold letters issued or to state that none in fact were issued, effectively forcing an admission that counsel may have dropped the ball in failing to put individual custodians on notice of their preservation obligations.

Leaving aside the novel argument that a sophisticated data-preservation system could allow organizations to avoid spoliation dangers, the court in this case seems to rebut another motif in the eDiscovery universe that is receiving a lot of attention.  The theme in question is what commentator Ralph Losey has aptly dubbed the “Luddite fallacy” (albeit in a slightly different context).  Simply put, the fallacy is that technology will eventually displace the independent judgment of both counsel and those data custodians with direct knowledge of potentially relevant evidence.  We see this in the well chronicled fears that document review technologies will displace high-dollar reviewing attorneys.  It now seems that we must apply equal skepticism to the perceived “threat” that technology can displace the experts’ roles in evidence preservation and production.

Until courts bless, without qualification, the notion that you can hit the “Easy Button” and dispense with your litigation risks, this commentator thinks it best to stick with the tried-and-true method of opening lines of communication early and often among counsel, relevant data custodians, information technology professionals, and any other experts that may be deployed in a given litigation or investigation.  Technology can support these key steps in very effective and efficient ways, but the failure leverage the appropriate individuals and processes could result in new and memorable case law…though not necessarily in a way that your organization would find beneficial.

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