The E-Discovery Amendments to the Federal Rules of Civil Procedure: An Introduction
In September 2005, the Judicial Conference of the United States unanimously approved proposed amendments to the Federal Rules of Civil Procedure (the “Rules”) and transmitted them to the Supreme Court, which approved them without comment or dissent on April 12, 2006. The goal of the amendments is to better equip the Rules to accommodate the differences between electronic discovery and traditional paper discovery, and to provide a framework to resolve the unique issues presented by electronic discovery. The amendments are now before Congress for review and will become effective on December 1, 2006, unless Congress enacts legislation to reject, modify, or defer them. The goal of this article is to provide practicing attorneys, particularly those who have not followed their evolution before now, with a basic introduction to the amendments.
The amendments, which apply to Rules 16, 26, 33, 34, and 37, can be grouped into five different subject areas relating to: 1) planning for discovery and initial disclosures; 2) two-tiered discovery; 3) form of production; 4) privilege and waiver; and 5) sanctions and safe harbor. (Rule 45 was also amended, but its amendments were written to bring the subpoena rules into conformity with the other rules as they relate to electronic data. Consequently, this paper does not discuss the amendments to Rule 45 in any detail.)
Before there can be any meaningful discussion of the amendments, one must first understand the definition (or lack thereof) of “electronically stored information.” That term has not been used previously in the Rules and is not defined in the amendments. However, the Judicial Conference Committee (“Committee”) provides some guidance on the issue. The Committee’s notes to Rule 34(a)(1), state the proper scope of a request for production of electronically stored information, “is expansive and includes any type of information that is stored electronically” and “is intended to be broad enough to cover all current types of computer-based information, and flexible enough to encompass future changes and developments.” Report of the Judicial Conference Committee on Rules of Practice and Procedure, September 2005 (hereinafter “Report”), available at http://www.uscourts.gov/rules/Reports/ST09-2005.pdf (last viewed April 30, 2006). The Committee Note to Rule 34 further indicates that the term “electronically stored information” should be given the same broad meaning when used in the other amended Rules. Id.
Initial Disclosures & Planning for Discovery – Amended Rules 16(b) and 26(a),and 26(f)
A. Rule 26(a)(1) Initial Disclosures
The current Rule 26(a)(1) requires each party, without awaiting the commencement of discovery, to provide the other parties with several categories of information, including a copy of or description by category and location of “all documents, data compilations, and tangible things” that are in the party’s possession, custody, or control and that the party may use to support its claims or defenses. The amendment to this rule substitutes “electronically stored information” for “data compilations,” attempting to clarify what constitutes the material formerly referred to simply as “data.”
B. The Rule 26(f) Conference
The current Rule 26(f) requires the parties to confer as soon as practicable and in any event not less than 21 days before a scheduling conference is held or a scheduling order is due under Rule 16(b). The rule requires the parties to confer on the nature and basis of their claims and defenses, possibilities for a prompt resolution of the case, Rule 26(a)(1) disclosures, and to develop a discovery plan. The amended rule now requires the parties to discuss “any issues relating to preserving discoverable information,” and further requires them to discuss the following specific electronic discovery-related issues:
26(f)(3) any issues relating to disclosure or discovery of electronically stored information, including the form or forms in which it should be produced;
26(f)(4) any issues relating to claims of privilege or of protection as trial-preparation material, including — if the parties agree on a procedure to assert such claims after production — whether to ask the court to include their agreement in an order.
These new provisions require litigants to address many electronic data issues as early as possible in the lawsuit with an intent to avoid costly and time-consuming disputes later in the case.
Amended Rule 26(f) explicitly requires parties to discuss the often contentious issue of the form of production for electronic data. Additionally, the Committee Note suggests that the parties may want to discuss the topics for discovery and the time period for which discovery will be sought, sources of such electronically stored information within a party’s control that should be searched, accessibility of the information, and the burden or cost of retrieving and reviewing it. These subjects, particularly those involving form of production, accessibility, and the burden and cost of retrieval, are critical in light of the other amendments to the Rules – such as Rule 34 and the new “two-tiered” discovery which amended Rule 26(b) has introduced. See infra.
The amended Rule 26(f) requirement that the parties discuss privilege issues is intended to address discovery delays and difficulties that may result from efforts to guard against waiver of privilege and work product protection. The Committee Note discusses litigants’ frequent need to spend large amounts of time reviewing materials requested through discovery to avoid waiving privilege, particularly in cases involving vast amounts of electronic data, and suggests that discussing privilege and waiver issues early may allow the parties to reach an agreement on how such issues should be handled by the court. For example, the Note states that parties may agree that a responding party will provide certain requested materials for initial examination without waiving any privilege or protection — sometimes referred to as a “quick peek.”
To prepare for a Rule 26(f) conference after these amendments take effect, counsel should become familiar with their clients’ information systems to negotiate a discovery plan that takes into account the client’s technology and priorities. Moreover, as the Committee Note suggests, it may be appropriate in some cases to identify and depose individuals with special knowledge of a party’s computer systems. To do so, counsel may seek leave to conduct such depositions before initial disclosures are due.
C. The Rule 16(b) Scheduling Conference and Order
Amended Rule 16(b) allows the court to include in its scheduling order provisions for disclosure or discovery of electronically stored information and any agreements the parties reach for asserting claims of privilege or of protection as trial preparation material after production.
“Two-Tiered” Discovery – Amended Rule 26(b)
In addition to the traditional limitations on the scope of discovery (such as unreasonably cumulative or duplicative discovery, information or materials which are obtainable from another or less expensive source, or undue burden of complying with discovery requests), the amended Rule 26(b)(2) now establishes procedures for a “second tier” of discovery related to electronically stored information which is not reasonably accessible.
Under Rule 26(b)(2) as amended, a responding party should produce electronically stored information that is relevant, not privileged, and reasonably accessible. The responding party must also identify, by category or type, any electronic sources containing potentially responsive information that it is neither searching nor producing. The responding party should provide enough detail to allow the requesting party to evaluate the burdens and costs of producing the second tier data and the likelihood of finding responsive information in the identified sources. In the event that a party files a motion to compel discovery or seeks a protective order, the responding party must demonstrate to the court that the information is not reasonably accessible because of undue burden or cost. Even where the responding party successfully establishes the lack of reasonable accessibility, the court may still order production if the requesting party demonstrates good cause for the discovery.
Production of Electronically Stored Information – Amended Rule 34
The amendments to the language in Rule 34 define the scope of discoverable information and the procedures for obtaining it.
As amended, Rule 34(a) will include the term “electronically stored information” among the categories of discoverable material. The amendments remove outdated references to “phonorecords” and indicate that data and data compilations include data “stored in any medium from which information can be obtained.” As the Committee Note to amended Rule 34 states, the definition of electronically stored information “is intended to be broad enough to cover all current types of computer-based information, and flexible enough to encompass future changes and developments.” Significantly, the committee also states that the right to test or sample tangible things extends to electronically stored information.
As amended, Rule 34(b) allows the requesting party to specify “the form or forms in which electronically stored information is to be produced.” The responding party, then, may include in its objections to the Requests for Production an objection to the form or forms of production requested and the reason for such objection. If it so objects, or if the requesting party did not specify a form for production of electronic data, then the responding party must state the form which its production of such data will take. In that event, the responding party must produce the information in the form in which it is ordinarily maintained or in a form that is reasonably usable. Importantly, a party that responds to a discovery request by simply producing electronically stored information in a form of its choice, without identifying that form in advance of the production in the response required by the amended Rule 34(b), runs a risk that the requesting party will show that the produced form is not reasonably usable and that it is entitled to production of some or all of the information in an alternate form.
This new procedure for production of electronically stored information highlights the need to prepare for a discussion of electronic discovery at the Rule 26(f) conference. If the parties are able to agree on a form of production from the outset, they can avoid potentially contentious and expensive disagreements once discovery has commenced. If they cannot so agree prior to discovery, and if no agreement on the form(s) of production can be reached after requests are served, then the court must decide the issue. In doing so, the court will not be limited to the forms of production advocated by either side of the dispute.
In its current form, Rule 33(d) gives parties the option to produce business records as a sufficient answer to interrogatories where the answer to an interrogatory may be derived or ascertained from the business records of the responding party and if the burden of deriving or ascertaining the answer is substantially the same for the requesting party as for the responding party. Rule 33(d) has been amended to add electronically stored information to the scope of such business records.
Privilege & Waiver – Amended Rule 26(b)(5)
The amendments to Rule 26(b)(5) add a new procedure by which parties may assert a claim of privilege or protection of trial preparation materials. In addition to the current requirement that a party withholding otherwise discoverable information or material expressly state the nature of the materials withheld in such a manner as to allow the opposing party to assess the applicability of the privilege or protection, the new rule will allow a party to assert a claim of privilege or protection after producing information or material without having asserted such a claim. Under the new provision, the party receiving the requested information “must promptly return, sequester, or destroy the specified information and any copies [after being notified of the post-production claim] and may not use or disclose the information” until the claim of privilege or protection is resolved. In order to obtain a prompt ruling on the claim, the party receiving the allegedly privileged or protected material may submit it to the court under seal for review. This new provision applies to all forms of discovery, including electronically stored information.
The amended Rule 26(b)(5) does not purport to address whether the privilege or protection asserted after production was waived by the production. Rather, it simply provides a procedure for presenting these issues to, and addressing them with, the court. It is intended to work hand in hand with the amendments concerning issues to be discussed at the Rule 26(f) conference, encouraging parties to discuss privilege issues in preparing their discovery plan and allowing them to request that the court include their agreement(s) regarding issues of privilege or trial-preparation material protection in an order.
Discovery Sanctions & Safe Harbor – Amended Rule 37
The amendments to Rule 37, which grants courts the authority to impose sanctions upon parties who fail to make the disclosures required by Rule 26(a)(1) or who otherwise fail to cooperate in discovery, introduce subsection (f), which specifically relates to electronic discovery and states, “Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system.”
This “safe harbor” provision recognizes the fact that ordinary computer operation involves the routine alteration and deletion of information that attends ordinary use, and that many steps essential to computer operation may alter or destroy information for reasons that have nothing to do with how that information might relate to litigation. It applies to information lost due to the routine operation of an information system only if the operation was in good faith. As the Committee Note makes clear, the good faith requirement does not mean that a party may exploit the routine operation of an information system to thwart discovery obligations. To the contrary, when a party is under a duty to preserve information because of pending or reasonably anticipated litigation, intervention in the routine operation of an information system may be necessary in order to demonstrate good faith.
When read together, these amendments communicate very clearly that counsel should begin evaluating issues relating to the location, accessibility, and use of electronically stored information immediately upon becoming involved in litigation of almost any complexity. The sooner counsel initiates a dialogue with its client regarding these issues, the better counsel will be able to advise its client regarding electronic data-related obligations and to advocate its client’s interests to the opponent and the court.