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The advisory committee on the Federal Rules of Civil Procedure has revised the draft electronic discovery amendments that were circulated for public comment last year and analyzed in two earlier articles [NLJ, 10-4-04 and 12-6-04]. This article addresses the revised form that these proposals now take. Same substance for initial discovery conference The language of the Rule 26(f) amendment has changed, but the substance remains the same. At the initial discovery conference, the parties must consider: (1) “Issues relating to preserving discoverable information.” (2) “Any issues relating to disclosure or discovery of electronically stored information, including the form or forms in which it should be produced.” (3) “Any issues relating to claims of privilege or 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.” Note that only item (2) is limited in scope to electronic discovery. Items (1) and (3) address preservation, privilege and inadvertent-production issues regarding all types of evidence. Initial Court Conference. As with Rule 26(f), the revisions to the public-comment version of Rule 16(b) are nonsubstantive. The two optional topics suggested for the initial scheduling order (and, thus, pretrial conference) are: “provisions for disclosure or discovery of electronically stored information” (this is identical to the earlier draft), and “any agreements the parties reach for asserting claims of privilege or protection as trial-preparation material after production.” “Reasonably Accessible” Electronic Information. The amendment to Rule 26(b)(2)(B) was substantively revised. Critics complained that the earlier draft did not explain how “reasonably accessible” differed from the undue-burden criterion currently contained in Rule 26(b)(2)(iii). The final text of the rule makes it clear that there is no difference. “Reasonably accessible” is the converse of unduly burdensome: “A party need not provide discovery of electronically stored information from sources that the party identifies as not reasonably accessible because of undue burden or cost. On motion to compel discovery or for a protective order, the party from whom discovery is sought must show that the information is not reasonably accessible because of undue burden or cost. If that showing is made, the court may nonetheless order discovery from such sources if the requesting party shows good cause, considering the limitations of Rule 26(b)(2)(C). The court may specify conditions for such discovery.” Like the public-comment version, the final text of Rule 26(b)(2)(B) focuses solely on accessibility of data and ignores all other burdens associated with electronic discovery. Nothing, however, prevents a responding party from relying on existing Rule 26(b)(2) in resisting a burdensome request for data not covered by new Rule 26(b)(2)(B). Privileged Information. The final amendment to Rule 26(b)(5) will add a subdivision (B) that has been changed substantially: Information produced. If information is produced in discovery that is subject to a claim of privilege or protection as trial-preparation material, the party making the claim may notify any party that received the information of the claim and the basis for it. After being notified, a party must promptly return, sequester or destroy the specified information and any copies it has and may not use or disclose the information until the claim is resolved. A receiving party may promptly present the information to the court under seal for a determination of the claim. If the receiving party disclosed the information before being notified, it must take reasonable steps to retrieve it. The producing party must preserve the information until the claim is resolved. The final text significantly differs from the public-comment version in two respects. First, there is no requirement that the producing party demand return of the inadvertently produced material “within a reasonable time” (a phrase that has been deleted). The demand may now be on the eve of trial, after discovery is closed and after the opponent has no ability to prove the point in any other way. This change is a bit mystifying. The committee is of the apparent view that, since the rule cannot affect the substantive law of waiver, a belated demand might give rise to a valid waiver defense. True, it might. Then again, it might not. The omission of the reasonable-time requirement is an invitation to mischief. Second, the final text makes it clear that the recipient of the data is not limited to returning, sequestering or destroying it in response to a demand for its return. The receiving party may promptly present the issue to the court. Interrogatories. The final text of Rule 33 has not been changed vis-�-vis the public-comment version. It makes it clear that a party may answer an interrogatory by referring to specific “electronically stored information,” just as it may with any other business records. This effects no change in practice because, for years, parties have considered that the phrase “business records” is not limited to paper. Document Requests. Rule 34(a) has been modified to address ambiguities in the public-comment proposal. It is better. It still has its issues. The final text no longer expressly distinguishes between “electronically stored information” and “documents,” but while it merges the two into an undifferentiated mass, it maintains a distinction between them by use of the disjunctive “or.” “Any party may serve . . . a request (1) to produce and permit the party making the request . . . to inspect, and copy, test, or sample any designated documents or electronically stored information -(including writings, drawings, graphs, charts, photographs, sound recordings, images phonorecords, and other data or data compilations in any medium . . . – . . . or to inspect, and copy, test, or sample any designated tangible things.” The drafting is needlessly problematic. For example, the illustrative list illuminating the phrase “designated documents or electronically stored information” includes “data or data compilations stored in any medium.” How can “electronically stored information” include data stored in nonelectronic media? Presumably, such data must still be “documents” only. But other items in the list, such as “sound recordings” and “images” are electronically stored. Are these not “documents” but “electronically stored information?” Are they both? What is the point of a list that is intended to illuminate a disjunctive phrase, where different entries on the list fit only with one or the other of the disjoined items? The best solution would be to define electronically stored information as a category of “document”-exactly as courts and practitioners have operated for years-but for some reason this suggestion has been rejected. The amendment to Rule 34(b) has not substantively changed: “The request may specify the form or forms in which electronically stored information is to be produced,” and the response may include an “objection to the requested form or forms for producing electronically stored information.” This codifies present practice. A new Rule 34(b)(ii) will provide that, absent a court order or stipulation: “[I]f a request for electronically stored information does not specify the form or forms of production, a responding party must produce the information in a form or forms in which it is ordinarily maintained or in a form or forms that are reasonably usable.” The phrase “reasonably usable” replaces “an electronically searchable form” in the public-comment version. This is noteworthy. Almost anything is “reasonably usable”-certainly a non-searchable TIF image qualifies, since it is the electronic equivalent of paper and paper has for decades been deemed “reasonably usable.” Indeed, nothing in the text prevents a responder from printing out paper copies and providing those as “reasonably usable.” A new Rule 34(b)(iii) will provide that, absent a court order or stipulation, “a party need not produce the same electronically stored information in more than one form.” This is equivalent to the last sentence of the public-comment version of Rule 34(b)(ii). A sanctions safe harbor in Rule 37(f) Sanctions Safe Harbor. The new Rule 37(f) has been entirely rewritten and bears no resemblance to the public-comment version. It now provides: “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.” There are at least three important aspects of this proposal. First, the “exceptional circumstances” standard is extremely difficult to satisfy. It appears only three places in the Federal Rules of Civil Procedure (rules 11(c)(1)(A), 26(b)(4)(B) and 32(a)(3)(E)), and it is rarely met. Therefore, when the safe harbor is triggered, it is highly unlikely that sanctions will issue. Second, the exclusive focus on routine deletion of data is problematic. This will change commercial behavior. Parties routinely sued will accelerate the routine deletion of data. Insurance companies will insist on it. It is far from clear why a rule should encourage data destruction. Third, there is no established need for this safe harbor. No cases have been cited showing that anyone has ever been sanctioned as a “result of the routine, good faith operation of an electronic information system.” Is the failure to comply with a corporate policy requiring retention of data once a litigation has commenced or a subpoena served evidence of bad faith, or just negligence? Does the “routine operation of an electronic information system” include the programmers who set the routines? Does it include the human actions of taking old backup tapes and recycling them? Gregory P. Joseph is a fellow of the American College of Trial Lawyers and a past chair of the litigation section of the ABA. He can be reached at [email protected].

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