Ammendments to Federal Rules

How the Federal Rules ammendments effect ESI

The Federal Rules of Civil Procedure (FRCP) were put in place to govern procedures in court for civil suits. In April 2006 the U.S. Supreme Court decided that the volume of electronically stored information (ESI) being transmitted during discovery requests in civil suits constituted the need for change in the Federal Rules and how ESI should be managed. These amendments to the Federal Rules took effect in December 2006 and the impact on law firms and the way electronically stored information is handled, processed and produced has been changed forever! At New Jersey Legal, we feel there are some key amendments to the federal rules that our clients should keep in mind. For your next litigation try to anticipate how your discovery request may be effected by your, the courts and opposing counsels interpretation and how to craft your arguments accordingly.

Federal Rules of Civil Procedure & E-Discovery

Summary of Important Changes to the FRCP:

1. Rule 26(a) must provide an inventory, description & location of relevant ESI.
2. Rule 26(b)(1) governs "the scope of discovery."
3. Rule 26(f) provides for a meeting of the parties to develop a proposed discovery plan. This is often referred to as the "meet & confer" conference.
4. Rule 26(b)(2) addresses "not reasonably accessible" data.
5. Rule 34 governs "document requests."
6. Rule 16 provides for "pretrial conferences."
7. Rule 37(f) addresses deleted data.

Federal Rule Amendments

Changes #1-3 to the Federal Rule Amendments

Parties MUST now address ESI and their plan for producing it EARLY in the process.

Rule 26(a) "Inventory, description and Location of ESI" now states that initial disclosures during the meet and confer include a "copy of, or a description by category and location" of relevant ESI. This "Inventory" of ESI will also serve to help companies that seek protection from burdensome EDiscovery costs under Rule 26(b)(2).

Rule 26(b) Scope of Discovery now states that the scheduling order must include "provisions for disclosure or discovery of electronically stored information."

Rule 26(f) Meet and Confer now requires that the parties "discuss any issues relating to preserving discoverable information and to develop a proposed discovery plan."

What does this mean? Before the new amendments, "discovery plans" were often communicated well into the litigation process (at times years into the case.) Since these requirements are now part of the initial "meet and confer", the time frame has been significantly reduced. Under 16(b) parties must "meet and confer" at least 21 days before the scheduling conference (which must occur within 120 days after filing the lawsuit).

The Bottom line: Parties must define and share their EDiscovery Plans within the first 99 days of the case!

Change #4 to the Federal Rule Amendments

Two-Tiered Approach to Electronic Data That Is "Not Reasonably Accessible."

Rule 26(b)(2) lays out what has been described as a "two-tiered" approach to electronic data in which parties are expected to bear their own costs of exchanging reasonably accessible data (i.e., data that is on active hard drives or servers that can searched without undue burden or expense). The general philosophy is that the parties should see if they can satisfy the information needs of their litigation with such accessible data before incurring the costs and burdens of seeking data deemed to be "not reasonably accessible."

A party that is responding to a discovery request would identify sources of potentially responsive material that is not reasonably accessible because of undue burden or cost. Examples of such material could include backup tapes or legacy data - the rules are not explicit because technology changes and data that is not reasonably accessible today may be rendered readily accessible next year. The party seeking the data could still make a showing of good cause for its production of the data, and the court, after considering a variety of factors such as whether the discovery was cumulative or duplicative or available elsewhere, could still order the production of the data subject to conditions. One of the "conditions" could be the shifting of some or all of the costs to the requesting party as in Judge Scheindlin's Zubulake III decision (Zubulake v. UBS Warburg LLC, 217 F.R.D. 309 (S.D.N.Y. 2003)).

Note that the duty to preserve records, even those that are not readily accessible, is a substantive obligation that is not affected by this rule. 26(b)(2) deals only with producing records.

Change #5 to the Federal Rule Amendments

NO flooding opposition with large volumes of ESI. The requesting party now has greater influence over the form in which the electronic data is produced. Production will increasingly be in a Native form or at a minimum with full text and metadata searching capabilities.

Rule 34(b) was amended to determine how ESI should be produced. The rule states that it is the requesting party, NOT the responding party, which requests "the form or forms in which electronically stored information is to be produced."

Rule 34(b)(ii) goes on to state that if the request does not detail the form(s) of production, the responding party must produce it "in a form or forms in which it is ordinarily maintained or in a form or forms that are reasonably usable."

Change #6 to the Federal Rule Amendments

Rule 16(b)(5) & (6)Pretrial Conferences, Scheduling & Management: The scheduling order entered under this rule includes provisions for disclosure or discovery of electronically stored information and permits the parties to reach agreements for asserting claims of privilege or protection as trial-preparation material after production.

Change #7 to the Federal Rule Amendments

Rule 37(f)Safe Harbor Provisions: This section of Rule 37 provides that absent exceptional circumstances, a court may not impose sanctions, under the 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.

In Summary

All parties to a litigation will be required to meet within the first 99 days of filing to discuss how they will handle electronic data.

They will need to come to the meet and confer session prepared with a "copy of, or a description by category and location" of the relevant ESI.

More productions will be required to be in native form, which will include extracted text and metadata.

The producing party will start by producing reasonably accessible or "Active" data only. If the requesting party asks that they produce inactive data then the requesting party may be required to pay for it. Data becomes accessible in the courts eyes once you restore it.

A party will not be sanctioned for lost data that is part of a routine data retention policy.