Welcome to the new eLessons Learned

eDiscovery Written by Law Students

eDiscovery Written by Law Students

eLessons Learned features insightful content authored primarily by law students from throughout the country. The posts are written to appeal to a broad spectrum of readers, including those with little eDiscovery knowledge.

Law + Technology + Human Error

Law + Technology + Human Error

Each blog post: (a) identifies cases that address technology mishaps; (b) exposes the specific conduct that caused a problem; (c) explains how and why the conduct was improper; and (d) offers suggestions on how to learn from these mistakes and prevent similar ones from reoccurring.

New to the eDiscovery world?

New to the eDiscovery world?

Visit our signature feature, e-Discovery Origins: Zubulake, designed to give readers a primer on the e-discovery movement through blog posts about the Zubulake series of court opinions which helped form the foundation for e-discovery. Go There

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Contribute to eLessons Learned

Interested students may apply for the opportunity to write for e-Lessons Learned by filling out the simple application. Go There




How To Tell The Difference Between Harmful Spoliation and Harmless Spring Cleaning

Author: David Solomon   Case Citation: Living Color Enters. v. New Era Aquaculture, 2016 U.S. Dist. LEXIS 39113 (S.D. Fla. Mar. 22, 2016).   Employee/Personnel/Employer implicated:   eLesson Learned:  While accidents do happen, in order to avoid court ordered sanctions, it’s important for a defendant to play by the rules.   Tweet This: What to keep in mind before deleting e-files. Don't let being tidy at home be your downfall in court.     Any good lawyer will tell you, it doesn’t take much to end up in trouble with the court. When it comes down to it, most activities that you may think are routine can suddenly become grounds for some severe sanctions from a not so understanding judge.   In the case of Living Color Enters v. New Era Aquaculture, this became the central issue of focus for our poor defendant. When it came down to discovery, there began to be a sinking suspicion by the plaintiff in regards to the potential that the defendant was holding out on a few old text messages.   Specifically, the defendant was accused of a few things: deleting old text messages between the parties, refusing to turn over the archived messages, and having an alternative email address.   The court ultimately developed a test made up of three questions. The first was ‘whether the evidence should have been preserved’; followed by was the evidence lost because someone didn’t take reasonable steps to preserve it; and finally, can the evidence be restored or replaced through additional discovery.   The court goes on to asses that if the answer to all three questions is ‘no’, then there is no issue. In the Living Color case though, they were all answered affirmatively. This meant the court needed to go on to decide whether not there was bad faith or prejudice to the other side from the lack of the evidence.   Luckily for the defendant, the court took into consideration that the plaintiff managed to receive the majority of the necessary communications from a third party. Also, a lot of the information that was being requested by the plaintiff were found to be unnecessary to their case.   It’s safe to say that all of this could have been avoided if the defendant just kept an archive of his messages, especially when he found out that he was going to be sued. I mean, seriously, it doesn’t matter if you have a weekly ritual of smashing your iPhone with a sledgehammer because your scared of the government tracking you. If you find out that you’re getting a complaint in the mail, you either start saving your messages, or live with your fear of the feds following you. Either way, playing by the rules will save you both money and headaches in the end.   David received his B.A. in English and Communication from Rutgers University. He will receive his J.D. from Seton Hall University School of Law in 2017. Presently, David interns for a non-profit organization involved with prisoner reentry. After graduation, David will clerk for a judge in the Superior Court of New Jersey. 

What Happens to an Injured Plaintiff who Skips a Deposition and Fails to Hand Over Pertinent Medical History?

Author: EJ Scarillo   Case Citation: Carr v. State Farm Mut. Auto. Ins., 312 F.R.D. 459 (N.D. Tex. 2015).   Employee/Personnel/Employer implicated: Plaintiff who was Involved in a Personal Injury Case     eLesson Learned: Do not dodge discovery requests!   Tweet This: Plaintiff stymies State Farm’s attempts to schedule deposition and collect medical information. Is this a sanctionable offense? To be determined.   Imagine the all too common discovery issue: one party requests certain discovery and receives nothing in return. The party requesting the discovery follows up with another request, but again hears only static on their end. Frustrated, the party then moves to compel the discovery. The court yawningly hears the evidence and issues a banal opinion, which concludes an order to compel the deficient discovery.   In Carr v. State Farm Mut. Auto Ins., the nameless party can be substituted in for a personal injury plaintiff who seemed a little too keen to avoid taking a deposition and tried to avoid providing blatantly discoverable evidence relating his personal injury claim. Specifically, the plaintiff was seeking to recover from his insurance company, State Farm, on an underinsured motorist claim. State Farm, being naturally inclined to avoid paying such a claim, requested the plaintiff’s medical history subsequent to the accident. State Farm also requested information pertaining to whether the plaintiff had any other insurance coverage. To no avail, State Farm diligently attempted to collect these documents. Alas, the court was asked to step in.   The plaintiff here valiantly tried to raise a novel privacy defense to avoid handing over his medical records. Further, he tried to claim the information relating to his other insurance was not relevant under Federal Rule of Civil Procedure 26. However, for the deposition, the plaintiff did not bother to mount a defense.   Simply put, the plaintiff would have better conserved his energy (and checkbook) by providing the discovery early on, as well as rescheduling the deposition. In life, as well as before a judge, “I do not know” is usually not the most prudent answer to a direct question. Yet, this is the exact response the plaintiff offered when asked why he did not reschedule the deposition he failed to attend.   Further, while patients have an obvious interest in maintaining the confidentiality of their medical records, State Farm’s request for medical records was narrowly tailored. Considering that they only asked for the plaintiff’s medical history subsequent to the date of the accident, it was glaringly apparent that this medical history would be discoverable. The same goes for answering whether the plaintiff maintained insurance other than his State Farm Policy.   All in all, the only potential silver lining for the plaintiff is that he may avoid being sanctioned. The court (in a rather charitable move) suspended its judgment on whether the plaintiff would have to pay State Farm’s expenses related to making the motion to compel, including attorney’s fees. Bluntly, there was no legally cognizable reason for the plaintiff not providing this discovery, other than neglect. A word of advice to the wary, save your and the court’s time by providing discovery to narrowly tailored discovery requests.

Using the court to drag your opponents production of ESI out of the stone age probably won’t work.

Author: Peter H. Robinson   Case Citation: Hyles v. N.Y. City, No. 10CIV3119ATAJP, (S.D.N.Y. Aug. 1, 2016)   Employee/Personnel/Employer implicated:   Employer, Employee   eLesson Learned: The court will not force a party to use predictive coding (TAR) as long as their preferred method of production is reasonable.   Tweet This: Parties can’t force one another to produce documents using predictive coding.     In a discovery dispute about the method of production used by one party, the court is very reluctant to impose a particular method of production, such as TAR, on an unwilling party. When an attorney requests that their adversary produce electronically stored information (ESI), the requesting attorney has very little control over how that information is produced.

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Which party controls the initial approach to searching for ESI? The producing party, as long its method produces sufficient results that are reasonable and proportional.

Author: RHL   Citation: In re Viagra (Sildenafil Citrate) Prods. Liab. Litig., No. 16-md-02691-RS (SK), 2016 U.S. Dist. LEXIS 144925 (N.D. Cal. Oct. 14, 2016).   Employee/Personnel/Employer implicated: Plaintiff’s Counsel   eLesson Learned: Plaintiff’s counsel should have shown the judge how defendant’s use of keyword search for electronically stored information (ESI) would produce insufficient results instead of pointing out the advantages and savings from using technology assisted review (TAR) or predictive coding.   Tweet This: To compel your opponent to use your preferred method of search for ESI, you must convince the judge that the opponent’s chosen method will not produce sufficient results, and that your method will.     In an ongoing lawsuit against Pfizer, In re Viagra (Sildenafil Citrate) Prods. Liab. Litig., No. 16-md-02691-RS (SK), 2016 U.S. Dist. LEXIS 144925 (N.D. Cal. Oct. 14, 2016), the courtdenied plaintiffs’motion to compel defendant to use technology assisted review (TAR) or predictive coding to search for electronically stored information (ESI) instead of Pfizer’s proposed keyword search method.   The court pointed out that “the responding party is the one best situated to decide how to search for and produce ESI responsive to discovery requests.” Id., at *51. The court further noted that plaintiffs did not cite any cases that required the responding party to use the “best” method of search, and as long as the responding party is able to produce results that are reasonable and proportionate, the court should not get involved.    The court heavily based its holding on a recent decision in Hyles v. New York City, 2016 U.S. Dist. LEXIS 100390, (S.D.N.Y. Aug. 1, 2016)), where the court agreed that TAR was a better approach to search for ESI, but saw no basis in law to require defendant to use it. Like the court in Hyles, the court here refused to strong-arm the defendant into using TAR or predictive coding to search for ESI when plaintiffs did not demonstrate that the use of keyword search would produce insufficient result. The court noted that even if keyword search result would be less complete than TAR-based, the standard is not perfection, but whether the results produced will be reasonable and proportional. The court held that as long as the discovery responses produced are sufficient, the court should not force the responding party to use a particular approach to search for ESI.    RHL is a law student at Seton Hall University School of Law

When is a Motion to Compel in Patent Litigation Too Broad? Proportionality and Pharmaceuticals: A Battle of Titans

Author: Thomas J Patania   Case Citation: Gilead Scis., Inc. v. Merck & Co., No. 5:13-cv-04057-BLF, 2016 U.S. Dist. LEXIS 5616 (N.D. Cal. January 13, 2016).   Employee/Personnel/Employer Implicated: Outside Counsel   eLesson Learned: When a party seeking discovery already has information regarding a patent in question, but refuses to take the opposing party at its word, a Court will find a Motion to Compel information related to other patents disproportionate. Specifically, when dealing with nucleosides and other molecular compounds, counsel should limit discovery requests to the specific compound at issue.   Tweet This: Taking the other party at its word: Disproportionality in patent litigation between pharmaceutical Titans   Taking the other side at its word can be extremely difficult, but in the case of pharmaceuticals, a party may have to do just that. Proportionality is key in patent litigation cases.  In Gilead Scis., Inc. v. Merck & Co., the Defendant (“Merck” or “Defendant”) sought discovery of several molecular compounds synthesized by the Plaintiff (“Gilead” or “Plaintiff”), even though Defendant already had information related to said molecular compounds.   Defendant, through a Motion to Compel, advocated its position by discussing the similarity between the molecular weight of the compound sought in discovery and the compound at issue in the suit. Defendant asserted that Plaintiff was infringing two of Defendant’s patents to a certain molecular compound named PSI-6130. Through a separate suit, Defendant had obtained a photo of several different tubes of compounds in Plaintiff’s possession. The molecular weight listed on one of the tubes was 259.2 grams, the same weight as PSI-6130. Thereafter, Defendant obtained information from Plaintiff that the tube in question held either PIS-0194 or PSI-1834, and not PSI-6130.   Even though Defendant was aware that the tube in question did not hold PSI-6130, Defendant filed a Motion to Compel, seeking discovery of the tubes, refusing to take Plaintiff’s word. Defendant claimed that because the molecular weight of PSI-6130 and the tube in question were the same, Defendant was entitled to discovery of the tube. Looking to the December 2015 updated language of Fed. R. Civ. P. 26(b)(1), the Court found that the discovery sought was disproportionate to the case. While the Court noted that proportionality was a requirement prior to the December 2015 Amendment, the Court emphasized that now, “a party seeking discovery of relevant, non-privileged information must show, before anything else, that the discovery sought is proportional to the needs of the case.”  Gilead Scis., Inc. v. Merck & Co., No. 5:13-cv-04057-BLF, 2016 U.S. Dist. LEXIS 5616 (N.D. Cal. January 13, 2016) (quoting Fed. R. Civ. P. 26(b)(1)). Because Defendant had failed to introduce any evidence that the discovery provided by Plaintiff was false, the Court noted that it “must take the producing party . . .  at its word.” Gilead Scis., Inc. v. Merck & Co., No. 5:13-cv-04057-BLF, 2016 U.S. Dist. LEXIS 5616 (N.D. Cal. January 13, 2016). In denying Defendant’s Motion to Compel, the Court noted that asking Plaintiff “to produce discovery on all sorts of compounds . . . [is] like requiring GM to produce discovery on Buicks and Chevys in a patent case about Cadillacs simply because all three happen to be cars.” Id.   In the future, Defense counsel may be wise to limit discovery requests to the specific compound at issue. While discovery isn’t specifically limited to the precise subject matter of the suit, here PSI-6130, Fed. R. Civ. P. 26(b)(1) is clear that discovery must be proportional to the matter at hand. Remember, when a requesting party refuses to believe that information is what the producing party claims, the opposing party is stuck taking the producing party at its word unless the requesting party can prove proportionality.    Thomas Patania, a Seton Hall University School of Law Student (Class of 2018), focuses his studies in the areas of general civil and healthcare litigation. Thomas spent his first three semesters in Birmingham, Alabama, at Cumberland School of Law, where he was a member of the Cumberland Law Review and National Trial Team. Outside of studying the law, Thomas enjoys snowplowing and hunting.

The Irony of Sending an Email to Erase Emails

Author: Brian Newsome Case Citation: GN Netcom, Inc. v. Plantronics, Inc., 967 F. Supp. 2d 1082 (3rd Cir. 2016). Employee/Personnel/Employer implicated: Vice President eLesson Learned: When you, or your company, has an impending legal action: DO NOT erase emails pertaining to said legal action. Tweet This: Plantronics’ Vice President displays lack of logic and ironically sends email to other employees instructing them to erase emails, automatically losing the case.   What happens when you delete emails that directly concern an impending lawsuit?  The short answer; you lose that case.  Just ask Don Houston from Plantronics. GN Netcom, Inc. v. Plantronics, Inc., is a perfect example of exactly how not to handle yourself when your company is facing a lawsuit.  In 2012, GN Netcome accused Plantronics of monopolizing and restraining trade based on Plantronics’ POD (Plantronics only Distribution) program.  In response to the impending lawsuit, Plantronics took significant steps to prepare.  Included in these steps was initiating a litigation hold and training sessions to ensure compliance within their company.  Apparently, and quite ironically, Don Houston, Plantronics’ Senior VP of Sales, missed the memo.  One month after the litigation hold was issued, Mr. Houston sent out an email that ultimately requested his team immediately delete entire strings of emails.  However, Mr. Houston didn’t stop there.  Ultimately, he went on to delete nearly 100,000 unrecoverable emails.  At this point, you’re probably thinking to yourself; “Well, that doesn’t seem legal.”  The short answer: It’s not, especially when the information deleted would help the opposing side. Federal Rule of Civil Procedure 37(e) addresses the applicability of sanctions when an employee acts in the manner in which Mr. Houston did.  More specifically, Rule 37(e) addresses not only the deletion of emails, but the inability to recover them through other investigative means.  A little tip: the average layperson, a/k/a you, doesn’t really know how to permanently delete emails so that they cease to exist.  More often than not, your emails will be “recoverable” rendering your unethical act useless.  If the emails, or other documents, would be deemed prejudicial to your opposition, Rule 37(e) allows the imposition of sanctions against you.  In the instant case, it was found that thousands of the unrecoverable deleted emails were in fact prejudicial to GN.  Consequently, the mere absence of the prejudicial emails proved the guilt of the accused. Let’s face it, Mr. Houston’s actions were intentional and unethical.  So, at this point, you might find yourself thinking; “Well, obviously I wouldn’t do that.”  However, the lesson to be taken away from Gn Netcom is much broader: always comply with the litigation hold. Keep in mind that anything deleted is quite easily recovered (provided you have someone with training) and you could easily save yourself embarrassment and money by complying with the litigation hold.   Brian Newsome, a Seton Hall University School of Law student (Class of 2017), focuses his studies in the area of Criminology.  He intends to work full time as an investigator at the New Jersey Office of Homeland Security and Preparedness.  He is a twice published author, and a former High School English teacher at the South Kent School in Connecticut. 

How Far Does a Party’s Legal Obligation to Produce Extend?

Author: Markiana Julceus   Case Citation: Jackson v. E-Z-Go Div. of Textron, Inc., No. 3:12-CV-154-TBR, 2016 U.S. Dist. LEXIS 146951 (W.D. Ky. Oct. 21, 2016)   Employee/Personnel/Employer implicated:   Outside Counsel   eLesson Learned: A Defendant’s duty to produce only extends as far as their control, and “control” under FRCP 34 means the “practical ability to obtain” the discovery.   Tweet This: Control for discovery purposes is limited by practicality.     FRCP 34 provides that discovery requests upon another party are proper if the production sought is "in the responding party's possession, custody, or control." “Control” is likely broader than you think it is.  This products liability lawsuit arose out of an accident involving an electric golf cart that led to the tragic death of one of the passengers. As part of the lawsuit against the golf cart manufacturer, Plaintiff, the deceased’s mother, sought discovery of incident reports, involving both the cart at question and other products the Defendant produced over the years, believing that the discovery would show that the Defendant was aware of these supposed defects. The Magistrate Judge directed the Defendant to produce non-privileged information from both internal and external sources regarding “other E-Z-GO incidents related to any of the four design features and other E-Z-GO incidents for which Defendants are not able to exclude that possibility that the incident may relate to those features.”  The “internal sources” included company records stored in an off-site, records of and correspondence with Defendants’ in-house counsel relating to prior claims and incidents, and Defendant’s own risk database known as “Risk Console”.  The “external sources” referred to outside vendors, including insurance companies, outside legal counsel, and expert witnesses who provided services in prior litigation. The Defendant strenuously objected on several grounds, the foremost of which was the argument that the information in the possession of external sources was not within their control. In assessing the external sources, the District Court agreed with the Magistrate Judge that the incident records from the company’s former counsel were within the Defendant’s control. As a result of the previous legal relationship between the parties, the Defendant’s had the “legal right to obtain the documents on demand.”  However, the District Court reversed with respect to information possessed by former insurance carriers, former expert witnesses, and former litigation consultants.  The defendant “has no practical ability, and therefore no ‘legal right’ to demand that independent third parties, not involved in the current litigation perform searches of their documents and produce documents that did not arise out of the current litigation.” The Court refused to require that the Defendant track down third parties and force those third parties to search through their documents in order to provide the requested discovery.   In short, what constitutes “within a party’s control” for discovery purposes is broader than you think it is but limited enough to ensure that discovery won’t become an undue burden.   Markiana received her B.S. in Diplomacy and International Relations from Seton Hall University in 2014 and will receive her J.D. from Seton Hall University School of Law in May 2017. After graduation, Markiana will clerk for an Associate Justice of the New Jersey Supreme Court. 

A Tale of Two Motions to Compel: The Need to Read the Rules

Author: Brendan Johnson   Case Citation: Pyle v. Selective Ins. Co. of Am., No. 2:16-cv-335, 2016 U.S. Dist. LEXIS 140789 (W.D. Pa. Sep. 30, 2016). See attached PDF.   Employer/Employee Implicated: No Employees implicated this case deals with Plaintiff Attorney’s duty to provide HIPPA authorizations and search terms.   eLesson Learned: Electronic Discovery should be a party driven process, this means that attorneys must meet and confer and attempt to reach practical agreements where possible.   Tweet This: Don’t be so formalistic -- FRCP for eDiscovery are to be read broadly!     This case is broken down into two motions and an order from the court. In the first motion, Plaintiff disclosed three doctors as individuals who are likely to have discoverable information on July 7, 2016. On September 6th Defense counsel severed Plaintiff with a request for production of document seeking medical records. Defendant brought this motion before the court on September 30th request to the court compel Plaintiff to produce documents. This motion was denied because F.C.R.P gives 30 days to respond to a request to produce. Since it had not yet been 30 days the motion was premature. The second and more important motion dealt with the Plaintiff refusing to give search terms to aid the Defendant in their eDiscovery. Plaintiff made a request for the production of “all emails, correspondence, memorandum, and/or other documents” from several of Defendants employees. Defendant responded by giving some documents and requesting that plaintiff give some agreeable search terms to aid in the eDiscovery. Plaintiff refused to give any search terms. Consequently, Defendant requested a second time and this motion was brought before the court to compel Plaintiff to provide search terms. Plaintiff claimed that there was no law or support for Defendant’s contention and the Court completely disagreed. The Court found that Defendant’s request was completely within the scope of discovery by the letter and the spirit of the Federal Rules of Civil Procedure. The Court stated, “electronic discovery should be a party-driven process.” Parties must meet and confer to and reach practical agreements without the court having to micromanage “search terms, date ranges, key players and the like.”  Trusz v. UBS Realty Inv’rs LLC, No. 3:09 CV 268 (JBA), 2010 U.S. Dist. LEXIS 92603 (D. Conn. Sep. 7, 2010). The Court granted the motion to compel and ordered that Plaintiff meet with Defendant and confer to establish agreeable search terms. The Court did not set a time limit for this meeting, but stated that it was in the best interest of both parties to resolve the issue as quickly as possible.   Brendan Johnson, a Seton Hall University of Law student Class of 2017, focuses his studies in the area of corporate litigation. Symposium Editor of the Legislative Journal. Will begin Clerking for the Honorable Judge Bariso August 2017. 

What Happens When an Employee Goes on an E-mail Deleting Spree?

 Author: E-Discovery Guru Case Citation: Orchestratehr v. Trombetta, 178 F.Supp.3d 476 (N.D.Tex. 2016) Employee Implicated: Employee eLesson Learned: Failure to prove that e-mails pertaining to a discovery request were deleted in bad faith on the part of the defendant or with the requisite intent to deprive plaintiff of the use of them in litigation will not yield sanctions against the defendant. Tweet This: Even if spoliation of evidence has occurred there will be no sanctions unless showing of bad faith or intent to deprive its use. The legal question of what happens when relevant evidence is spoliated versus when is spoliation the product of regular, routine deletion was at issue in this case. Plaintiffs contend that Defendant Mr. Trombetta intentionally spoliated crucial evidence by deleting e-mails that would have been unfavorable to him in this lawsuit. Consequently, Plaintiffs sought an adverse inference jury instruction as a sanction. “Under the spoliation doctrine, a jury may draw an adverse inference ‘that a party who intentionally destroys important evidence in bad faith did so because the contents of those documents were unfavorable to that party.’” Whitt v. Stephens County, 529 F.3d 278, 284 (5th Cir.2008)(quoting Russell v. Univ. of Texas., 234 Fed. Appx. 195, 207 (5th Cir.2000)). The Court, here, recognized it had a right to assess sanctions using its inherent powers. See Hodge v. Wal-Mart Store, Inc., 360 F.3d 446, 449 (4th Cir.2004) (“The imposition of a sanction . . . for spoliation of evidence is an inherent power of the federal courts.”) Mr. Trombetta, the Court stated, had the “duty to preserve evidence . . . when the [he] ha[d] notice that the evidence [was] relevant to the litigation or should have known that the evidence might be relevant.” Orchestratehr, Inc. v. Trombetta, 178 F.Supp.3d 476, 489 (citing Rimkus Consulting Group, Inc. v. Cammarata, 688 F.Supp.2d 598, 615-16 (S.D.Tex2010)). In this instance, however, the Court believed that the issue of sanctions was covered by Federal Rule of Civil Procedure 37, as amended effective December 1, 2015, to prove sanctions against a party for the failure to preserve electronically stored information. See Fed. R. Civ. P, 37(e). Mr. Trombetta had anticipated litigation when he resigned from Orchestratehr and when he deleted the e-mails at issue. Moreover, in some instances he even said he “may have” intentionally deleted e-mails to cover his tracks. However, there is also another side to the coin. Mr. Trombetta, during the normal course of business, deleted emails on a regular basis unless there was a specific business reason to keep them. He asserted that he “did not know or anticipate that any of the e-mails [he] deleted within the course of [his] work for Orchestratehr would be used in a lawsuit against me [him] or anyone else.” Orchestratehr, 178 Supp.3d at 491. Being that the e-mails were all already backed up on the company’s server, Mr. Trombetta affirms that he never removed or deleted an email from its servers. Ultimately, the Court believed that the evidence established that Mr. Trombetta was aware of potential litigation at the time he deleted the emails and that he knew or should have known that emails on certain subjects might be relevant to the litigation. However, the evidence was less than clear as to whether Mr. Trombetta acted in bad faith or with the intent to deprive another party of the information. As such, the Plaintiff’s Motion for Sanctions against Mr. Trombetta for the spoliation of evidence was denied. In order to prevent such a mishap from taking place again, Mr. Trombetta and others in his position should be more in tune with the way they conduct e-mail deletions. Perhaps, he should have asked colleagues whether such the behavior of routinely deleting emails was appropriate when he knew that potential ensuing litigation might call those e-mails he deleted into question.   E-Discovery Guru will receive his J.D. from Seton Hall University School of Law in 2018. He is pursuing a course load that is geared toward becoming a transactional attorney. His membership on one of the Seton Hall Law journal is aimed at further honing his legal writing and research skills should such skills be required in his post-graduation job. Prior to law school, he was a 2015 summa cum laude graduate of Seton Hall University’s College of Arts and Science where he received his B.A. in Political Science. E-Discovery Guru spent the last summer interning for a State Court Judge in New Jersey. 

IRS is 0-2 in a Battle Against Technology Assisted Review

Author: Stephen Daniels   Case Citation: Dynamo Holdings v. Comm’r of Internal Revenue, Docket No. 2685-11, 8393-12 (T.C. July 13, 2016).   eLesson Learned: Judicial bodies are trending towards acceptance of computer-assisted discovery techniques, perhaps even bordering on embracing it, like in the Dynamo Holdings decisions.   Tweet This: The IRS loses yet another battle against technology assisted review.   The US Tax Court, located in Washington, DC, is the latest judicial body to contribute to the legitimacy of TAR as a technique for complying with discovery requests. For the second time in the last two-plus years, the US Tax Court has rebuffed the IRS’ arguments against the use and efficacy of TAR in Dynamo Holdings v. Comm’r of Internal Revenue.   Back in 2014, the US Tax Court in Dynamo Holdings I had to decide whether predictive coding was a viable method of responding to discovery requests for electronically-stored information (“ESI”). In that case, the IRS filed a formal request for Dynamo Holdings and other related parties (“Dynamo”) to provide certain ESI. Dynamo was hesitant to comply with the IRS’ formal request due to the time and cost involved in reviewing all of the requested documents, as well as removing privileged information contained in the ESI.   As an alternative to producing all the requested ESI manually, Dynamo requested that the US Tax Court allow them to use TAR, or predictive coding. Predictive coding would allow Dynamo, via computer software, to efficiently and economically identify non-privileged information. Over the IRS’ argument that predictive coding should not be allowed due to it being an ‘unproven technology’, the US Tax Court decided that its use would be acceptable. Loss number one for the IRS.   The Court left it to the parties to make it work between themselves, and left the possibility open for the IRS to file another discovery request if they were unhappy with the results of the predictive coding. And sure enough the IRS was not satisfied with the results, which led to Dynamo Holdings II in July 2016. This forced the US Tax Court to publish another decision regarding TAR, but this time relating to its effectiveness.   After Dynamo Holdings I, Dynamo and the IRS worked together to produce the ESI using predictive coding. However, after much collaboration, the parties ran into problems. The parties created a model to produce the ESI, but the IRS doubted its accuracy and performance. In its view, the software was not delivering all the documents it should have. The parties could not agree, so the IRS filed a motion to compel production of the documents that it thought the predictive coding should have turned up.   This time, the US Tax Court’s task was to evaluate the usefulness of the predictive coding. It held that the mere fact that a responding party uses predictive coding does not result in holding TAR to a higher standard than manual review. The use of TAR does not require any more than manual review in order to be considered a complete response.   Overall, the US Tax Court held that Dynamo satisfied its obligation in responding to the IRS’ request by producing any and all documents that the predictive coding deemed relevant. Loss number two for the IRS.   From the Dynamo Holdings cases, it is clear that not only is TAR widely accepted by judicial bodies, but it is given deference. In Dynamo Holdings II, the US Tax Court placed a surprising amount of trust in the predictive coding software. Within the decision, the US Tax Court did not go anywhere near evaluating the predictive coding software itself. The Court’s lack of skepticism was unexpected but perhaps telling as to its level of faith in TAR.   Stephen Daniels, a Seton Hall University School of Law student (Class of 2017), focuses his studies in the area of corporate taxation. He is the Treasurer of the Sports Club, as well as a member of the Corporate Law Society and Tax Law Society. Prior to law school, Mr. Daniels graduated magna cum laude from the Seton Hall University Stillman School of Business, where he earned a B.S. in Business Administration with concentrations in Finance and Management. He also minored in Legal Studies and received a certificate in Leadership Development. After graduating from law school, he will be working in International Tax at KPMG. 

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    The blog takes a clever approach to [e-discovery]. Each post discusses an e-discovery case that involves an e-discovery mishap, generally by a company employee. It discusses the conduct that constituted the mishap and then offers its ‘e-lesson’ — a suggestion on how to learn from the mistake and avoid it happening to you.

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