e-Lessons Learned

The old adage: “measure twice, cut once” applies to carpentry and very well should apply to the legal profession. Both a carpenter and an attorney will save time and money by adhering to this maxim.

Take for example Preferred Care Partners Holding v. Humana. In that case, Humana produced an additional 10,000 documents two months after the completion of discovery, and suffered sanctions because of it. Humana discovered the existence of these newly produced documents during a deposition of an employee who found residual copies of documents that he believed had been deleted from his computer. As a consequence, Humana conducted a subsequent search which led to the discovery of a vast number of residual files on other computers. Because of the need to sort through all of the documents to determine which ones were responsive and privileged, the files were not produced until well after discovery concluded, and only a short time before trial.

This failure to locate documents could have been avoided if counsel had simply instructed all employees to conduct a basic search of their computers for responsive documents. Instead, outside counsel here assumed that employees deleted these documents as required by a confidentiality agreement between the two companies. This incorrect assumption that the files no longer existed resulted in significant problems for counsel and his client. Unfortunately for outside counsel (and Humana), 10,000 documents were not deleted as per the agreement; and thus, the documents should have been uncovered and produced during discovery. The lack of timely production arose from the (false) belief that all computers contained only one initial copy of the relevant files when in fact many of them contained residual copies. These residual copies were discoverable and should have been discovered and turned over during discovery.

An important lesson to remember in this day and age is that rarely, if ever, does a computer actually delete (i.e., “gone forever”) a file. Computer files automatically “back-up” during normal document creation. If back-up or residual copies of documents that pertain to ongoing litigation exist, then a lawyer must do the necessary diligence to find them.

Humana’s outside counsel did not inquire and conduct the necessary searches to discover the residual documents during discovery. Instead, counsel just assumed that the documents were destroyed in accordance with the preexisting confidentiality agreement. Making assumptions can have dire consequences in life and the law. Here, the court issued sanctions in two ways. First, it permitted additional discovery to ensure Humana turned over all relevant documents and give Preferred Care Partners the necessary time to review them before trial. Second, the court ordered Humana to pay all of Preferred Care Partners’ costs and attorney’s fees in relation to the additional discovery and defense of the motion required as a result of Humana’s “grossly negligent” discovery conduct. The court agreed with Preferred Care Partners that Humana’s delay was either “an intentional effort to sandbag PCP on the eve of trial or at least was the result of Humana’s grossly negligent execution of its discovery obligations.” Preferred Care Partners Holding v. Humana, 2009 WL 982460, ¶1 (S.D. Fla. April 9, 2009).

In order to avoid the type of sanctions that the court issued as a result of Humana’s conduct, outside counsel should be sure to conduct thorough eDiscovery. Even when corporate counsel believes that computer files no longer exist, it’s better to inquire of the relevant IT professional to be certain that all relevant documents are accounted for. Attorneys are not technology experts, and it is always best to ask for help instead of making dangerous assumptions that can cost you and your client time and money.

Article posted on February 23, 2010 at 12:54 AM |              More... 
Tagged as: Accessibility, Computer Forensics Protocols, Cost Sharing & Shifting, Good Faith, Privilege, Production of Data, Sanctions, Work-Product Doctrine.
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