eLessons

Cornell Law and Business Grad Gets Spanked By Judge for Violating Basic Ethics and Evidence Rules

If you are involved in a lawsuit you may not destroy relevant evidence, inadvertently or purposefully, without facing consequences. In this lawsuit, the defendant, who is the owner of the company and a lawyer, destroyed possibly more than 10,000 relevant e-mails after receiving notice of a copyright infringement suit against him. The court found the defendant’s efforts to “remedy” the error disingenuous; the destruction of evidence was found to have been done maliciously and purposefully. When the litigation commenced, the plaintiffs sent the defendant a document request and repeatedly asked for any and all electronic files, e-mails included, that the defendant had created or sent to others. About a year after the suit had commenced, defendant’s counsel, who later withdrew from the case, notified the plaintiffs that the defendant had ended his account with a third-party web supplier and thus defendant’s website and e-mails were all destroyed. This was done two months before the account was set to expire even though it was already fully paid for. The defendant also admitted to deleting sent e-mails as part of his ordinary practice and did not change that practice after the lawsuit was filed. Furthermore, he also admitted to manually deleting e-mails after and in response to a cease and desist demand, after his deposition, and multiple times during the course of litigation. The court found that he had acted in such a manner to prevent plaintiffs from accessing the e-mails, which were an integral part to the litigation. The defendant’s actions were a clear violation of ethics and evidence rules. The court found particularly egregious that the defendant, a Cornell law and business graduate, claimed to not know that there was an obligation to maintain all documents. He claimed this even though he had passed the New York State Bar exam and received a document request from the plaintiffs stating which documents were needed for the litigation.  Moreover, the third party web supplier testified that when the defendant originally closed the account, the defendant then called to ensure that the e-mails had been deleted. It was only after the defendant received a deposition notice on the spoliation (the destruction of evidence) that he then called the web supplier to ask if there was any way to retrieve the e-mails. This was nearly a month after he had called to ensure they were fully removed from the systems. The defendant then reactivated the account only to set it to automatically terminate in less than a month. The third party supplier testified that once the account was terminated there was no way to recover any e-mails…so why did defendant reactivate his account? The court determined that this was done to show a “selective repopulation” of e-mails from the first termination. The defendant conceded that he had manually repopulated the account with e-mails that he was able to obtain from one of his recipients. These e-mails that were now “found” in the reactivated account were merely the ones manually selected for repopulation by the defendant. The court was also thoroughly displeased with the defendant because after the second termination of the account, the defendant repeatedly called the third party supplier in an attempt to create a false record that the supplier had terminated the account and not he himself. Due to the defendant’s actions, the court not only found that spoliation of evidence had occurred and that the defendant had acted intentionally, but also that the plaintiff was clearly prejudiced by the defendant’s intentional destruction of evidence.  The court thus imposed the harshest sentence allowed against the defendant: a terminating sanction. This sanction is the harshest penalty as it is a punishment for grossly improper litigation behavior that ends the offending party’s participation in suit, usually then dismissing or finding for the opposite side. In this case, judgment was granted to the plaintiff due to the defendant’s intentional destruction of evidence and attempt to create a false record. What the defendant should have done was save all the e-mails and turn them over to the plaintiffs. Instead, by intentionally destroying evidence and attempting to improperly lay blame, the court imposed the harshest punishment on the defendant. Knowing the risks and punishment involved with intentionally destroying evidence it is unclear why the defendant did what he did. Ms. Mansour is a Seton Hall University School of Law Student (Class of 2015). She has taken a sampling of courses across various disciplinary areas and participated in a variety of externship programs in addition to being on Legislative Journal. She graduated from Rutgers University with a concentration in Psychology and has her M.A. in Translation and Translation Studies from UNC – Charlotte. She currently is a legal intern for the King’s County District Attorney’s Office. Want to read more articles like this?  Sign up for our post notification newsletter, here.

Does Forwarding Emails To An Opposing Party Qualify As A Sufficient Method of Transfer for Discovery Purposes?

The employee in this case was not an inexperienced layperson, but rather a seasoned and accomplished trial attorney. Yet even with her wealth of knowledge regarding discovery, she was nearly cited for contempt of court as a result of her unfamiliarity with electronic discovery obligations. When obligated to turn over emails to your opposing party during discovery, it is not enough to simply forward the email. Courts require the emails to be in their native form, which means containing the crucial metadata contained within the original email. In Sexton v. Lecavalier, the plaintiff, Byron Sexton, subpoenaed all documents in the defendant’s possession regarding several business entities. The subpoena provided that if these documents were in electronic form, the copies produced must be in their “native” format. In response to the subpoena, the defense attorney produced numerous documents including eleven emails that had been forwarded to her from her client’s Gmail account. The defense attorney claimed that she could not access the emails in their original format and even had an IT expert testify that the emails could not be accessed in their native format because the infrastructure for the email is controlled by Google, who does not allow its users to copy emails in native format. The issue in this case is that the emails were located in the “cloud,” and thus stored with a third party. However, even though a third party held the emails, the plaintiff argues that there are two ways to preserve the crucial metadata. (1) Emails can be downloaded to an email client such as Microsoft Outlook and then saved onto a computer in the format used by the client; and (2) Gmail emails that have been displayed in their “original” format by clicking “show original” and then saved as a PDF. The court held that even though the plaintiff currently lacked access to the files in their native format, this fact does not absolve counsel of her discovery obligations. A growing number of attorneys and courts are realizing the evidentiary value to metadata and as this trend continues, it is becoming crucial for parties to preserve all relevant electronic data. There is currently electronic discovery software in existence, which makes preservation of data a whole lot easier (http://www.ediscovery.com/solutions/collect/ is merely one example of such software). The presiding judge went on to scold both parties for even bringing this discovery disagreement in front of the court. The judge stated that the parties should have resolved this matter outside of court and that the defendant could have provided the emails in a correct format with minimal cost. However, the judge believed that the defense attorney had a good faith belief that the emails could not be provided in their native format and refused to hold her in contempt. It seems that ignorance was the defense attorney’s saving grace. Any practitioners reading this will not have the luxury of such a defense. In order to avoid charges of contempt being levied against you in the future, it would be wise to invest in electronic discovery software. At the very least, you should download Microsoft Outlook and save all of your emails in a format that preserves metadata such as .eml or .msg. As less paper copies of documents are being utilized, and as electronic storage is becoming more prevalent, native documents are going to become an issue increasingly seen by courts. Additionally, resolve any such discovery issues with your opponent. No judge wants his or her time wasted with similar motions compelling discovery. Daniel received a B.A. in Criminology and Criminal Justice from The University of Maryland. He will receive his J.D. from Seton Hall University School of Law in 2015. Presently, Daniel is serving as a legal intern in the Juvenile Justice Clinic. After graduation Daniel will clerk for a trial judge in the Superior Court of New Jersey. Want to read more articles like this?  Sign up for our post notification newsletter, here

Erasing Videotapes Can Be Dangerous for Everyone, Not Just Politicians!

In McCann v. Kennedy Univ. Hosp., Inc., the plaintiff Robert McCann sued Kennedy University Hospital, asking the court to sanction the hospital for intentionally or inadvertently destroying necessary videotapes.  The plaintiff contended that the videotapes contained an account of the defendant’s emergency room lobby on the night the plaintiff claims to have been mistreated by the defendant’s staff. The plaintiff argued that the defendant knew or should have known that the video tapes were discoverable material and that there was actual withholding or suppression of the videotapes, which constituted spoliation. On December 21, 2011, the plaintiff was transported to the hospital after suffering extreme rectal pain and trouble breathing. The Plaintiff claims to have been in excruciating pain while he was waiting to be seen by the hospital staff. He states that he was ignored and neglected for at least seven hours. During the time that he was at the hospital, the plaintiff claimed to have collapsed on the floor and was left lying on the floor for over ten minutes, while staff walked over him without offering assistance. McCann also claimed that when he was eventually seen by the hospital staff, they treated him in ways that made him feel humiliated and uncomfortable. The hospital allegedly refused to treat McCann because he did not have insurance. On December 23, 2011, the plaintiff sent an e-mail to Renae Alesczk, the assistant to the Senior Vice President of the Kennedy Health System, complaining about his experience at the hospital while also threatening to sue. A few hours after the email was received, Aron Berman, formerly employed as the defendant’s Director of Guest Relations and Service Improvement, forwarded the McCann’s e-mail to Kim Hoffman, the Corporate Director of Patient Safety. The defendant claimed to have conducted an internal investigation of the complaints at that time, and notified the plaintiff that his complaints were being addressed. The hospital staff then stated that the investigation showed that the hospital staff acted appropriately and managed the patient’s clinical care in a professional manner. So far, so good. However, the plaintiff’s attorneys requested videotapes of the emergency room lobby, which showed the plaintiff waiting without being treated by staff. The defendants claimed that there was no videotape footage because they did not have enough disc drive space to keep all their video footage and had already erased the footage from the night in question. The plaintiff argued that the defendants knew or should have known that the videotapes would be requested in discovery, and that the defendants should not have destroyed the videotapes. The plaintiff claimed such activity as obstruction of justice and an intentional spoliation of evidence. The defendants argued that the tapes only show the time period during which the patient was in the waiting room, and are irrelevant to the plaintiff’s complaints about the treatment by staff when he was seen in the hospital. The Third Circuit has adopted a four-factor test for evaluating spoliation claims, finding that spoliation occurs where: “(1) the evidence was in the party's control; (2) the evidence is relevant to the claims or defenses in the case; (3) there has been actual suppression or withholding of evidence; and (4) the duty to preserve the evidence was reasonably foreseeable to the party.” Here, there is no argument that the tapes were in the party’s control. The court found that the tapes were not relevant to the plaintiff’s claims and that the defendant did not have a duty to preserve the video tapes at issue.  Therefore, there had not been actual suppression or withholding of the evidence. The takeaway from this case is that the court found it was reasonable for the hospital to destroy the videotapes because the plaintiff’s claim was specifically in regard to his being treated while at the facility, NOT his experience while waiting in the lobby. However, to be safe, videotapes of the night in question should be preserved to avoid this kind of confusion. Rebecca Hsu, a Seton Hall University School of Law student (Class of 2015), focuses her studies in the area of patent law, with a concentration in Intellectual Property. She is also certified in Healthcare Compliance, and has worked in Compliance at Otsuka America Pharmaceuticals, Inc.  Prior to law school, she graduated, cum laude, from UCLA and completed graduate work in biomedical science. She has co-authored two medical science research articles, as well as completed fellowships through UCLA Medicine and the Medical College of Wisconsin. In addition to awards for her academic achievements, Rebecca has been honored by awards for her community service with disadvantaged communities. In her spare time, Rebecca regularly practices outdoor rock climbing, and can be found camping in the Adirondacks. Want to read more articles like this?  Sign up for our post notification newsletter, here

Court Protects Against Requested Deposition of An IT Witness for Fear of Opening Floodgates

Philips and Hunt may have been debating the ownership of the tagline “Sense and Simplicity,” but it seems the U.S. District Court for the District of New Jersey was more interested in exploring the sense and simplicity of Rule 26 of the Federal Rules of Civil Procedure when it handed down the ruling in Koninklijke Philips N.V. v. Hunt Control Systems.  After noting that Rule 26 permits a broad scope of permissible discovery, Magistrate Judge James B. Clark, III held that a responding party need not use every tool in their toolbox in order to comply with a Fed.R.Civ.P. 30(b)(6) deposition request. In his memorandum opinion, Judge Clark held that an alternative approach to ESI collection, as requested by Hunt, was burdensome and likely to be unproductive.  The collection was such a burden, in fact, that Judge Clark granted Philips’ motion for a protective order against further such requests. Hunt had previously interviewed “a Philips IT/ESI discovery professional” regarding Philips’ ESI practices.  Months later, Hunt noticed a deposition for an IT witness claiming that Philips’ responses for eight questions were not adequately answered by the interviewee.  Philips objected to the deposition request and petitioned the court for a protective order. Hunt argued that the IT deposition was necessary in order to discover whether Philips was using appropriate search tools for the ESI discovery requests.  Hunt’s argument was supported by an IT professional who opined that Philips’ “cloud-based IT structure” and Philips’ “sophisticated and comprehensive state-of-the-art document search and location tools” meant that Philips was obligated to use a particular method to accommodate Hunt’s electronic discovery requests.  Hunt further argued that the deposition did not create an undue burden on Philips so as to outweigh the likely benefits. In seeking a protective order, Philips counters that the provided answers were accurate and that Philips has consistently used “a custodian-based approach to collecting ESI” and thus, shouldn’t be required to employ alternative approaches at the request of Hunt.  The court agreed with Philips, citing three individual reasons.  First, the Court found that Hunt failed to carry its burden of showing that Philips’ production has been materially deficient.  Significantly, Judge Clark wrote that just because Hunt was dissatisfied with the result of Philips’ production, such dissatisfaction was “not enough to reopen the door to the collection of ESI discovery under an entirely different method.”  Because Philips’ responses were true and accurate, there was “no compelling reason” to force Philips to use Hunt’s preferred method of production. Second, the court held that even if an alternative approach to ESI collection was more appropriate than Philips’ “custodian-based” search, Hunt still failed to produce evidence showing that conducting another search under their preferred methods would substantially alter the results Philips already produced.  Again, Judge Clark takes the opportunity to emphasize that employing multiple methods of production would be “duplicative” and “an inefficient use of time and resources.” Third, and most importantly for future cases involving these circumstances, Judge Clark wrote that it was not Hunt’s requested deposition that caused an undue burden on Philips, but rather “the possibility of opening the door to more (and likely unproductive) discovery with no apparent end in sight.” Putting a stern period on the end of a judicial statement, Judge Clark concluded by noting that the proposed deposition contained only a “marginal benefit” to Hunt that is “heavily outweighed” by the “tremendous burden” to Philips.  Judge Clark made it clear (and seemingly warned future litigators) that the court will not entertain duplicative and seemingly petty disputes over the method of e-discovery production, so long as the information produced is not “materially deficient.” In light of this decision, parties requesting discovery would be wise to make their requests as specific as possible in the first instance, including a specified or desired approach to collecting ESI.  Such specificity (accompanied with reasonability) may result in more beneficial discovery as well as preventing the scorn of wasted judicial time. Nicole was a 2010 magna cum laude graduate of Northeastern University located in Boston, Massachusetts, where she earned her B.A. in English and Political Science.  In 2015, Nicole will receive her J.D. from Seton Hall University School of Law.  After graduation, Nicole will serve as a clerk to a trial judge of the Superior Court of New Jersey in the Morris-Sussex Vicinage.

Should I Obstruct Discovery?—A Classic Pyrrhic Victory Problem

A pyrrhic victory is defined by winning an early battle but eventually losing the war because of the costs and expenses of that earlier battle. Everyone has heard the phase, “you may have won this battle but I will win the war.” Victory in life, business, and litigation is achieved by obtaining a favorable outcome in the end, and not defined by winning an early battle over discovery where you exhaust resources by attempting to try to obstruct your opponent. Individuals who fail to comply and purposely try to hide or destroy a document can trigger serious legal consequences and significantly hurt their chances for long term success in the litigation. In Klipsch Group, Inc. v. Big Box Store Ltd., Klipsch Group, Inc. sued Big Box Store (“BBS”) for the spoliation of relevant documents as well as other discovery misdeeds. Klipsch commenced a lawsuit against BBS for infringement of their trademark on a particular headphone in 2012. BBS conceded that they sold some counterfeit headphones but claimed that the sales were innocent and yielded almost no profit. Klipsch’s main claim against BBS is that they failed to hold or preserve relevant documents pertaining to the pending lawsuit when they became aware of the litigation in August 2012 (a requirement by law).    Every litigant has an obligation to take reasonable measures to preserve all potentially relevant documents once it has noticed that a lawsuit has been filed. Specifically, that obligation may arise even prior to litigation being formally filed if "the party 'should have known that the evidence may be relevant to future litigation.'" MASTR Adjustable Rate Mortgages Trust 2006-OA2 v. UBS Real Estate Secs., Inc., 295 F.R.D. 77, 82 (S.D.N.Y. 2013) (quoting Kronisch v. United States, 150 F.3d 112, 126 (2d Cir. 1998)). Here, BBS should have known about the possibility of future litigations since they were knowingly infringing onto Klipsch’s patent by selling counterfeit headphones. Klipsch suspected that BBS’ actions warranted, at a minimum, a forensic investigation into their company for documents that could reveal if a larger quantity of counterfeit headphones were sold. Klipsch, correctly believed, that based on the information they received through discovery it seemed that large quantities of documents (emails, transactional documents, sales reports) were missing or altered. This belief was verified during subsequent depositions of BBS employees. The depositions revealed that BBS employees produced contradicting stories than the information revealed in discovery. In deciding Klipsch Group, Inc. v. Big Box Store Ltd., the court refused to levy a severe punishment against BBS although it was discovered that they had broken numerous discovery laws. Instead, the court took a passive approach and applied “the mildest of available remedies” that allowed the parties leave to pursue additional discovery, except this time with an experienced forensic computer expert. However, the court could have imposed stricter penalties onto BBS, such as, termination, preclusion of testimony, or a mandatory adverse-inference charge after it discovered BBS’s possible attempt to destroy evidence. Instead, the court chose a more cautious route and tabled those actions until the forensic discovery was completed. This ponders the question, if the aim of any remedy is to deter the parties from engaging in spoliation and restore the aggrieved party to the same position then why not have automatic forensic discovery? The answer? Costs. Klipsch suggested that the imposition of costs, including fees should be shifted to BBS. The court disagreed and held that the costs would first be borne by Klipsch and could be reallocated or apportioned based on the findings of the expert’s report. The court could better deter abuse of discovery by always imposing costs for forensic experts onto defendants who are found to have wrongfully withheld information requested in discovery. This action and precedent would cause all parties to become forthcoming with unaltered information due to the fear of additional costs levied in litigation. Ultimately, the expert’s report will produce the information needed for Klipsch to move forward in their litigation against BBS, or it will prove unfruitful and Klipsch will drop their litigation. This entire matter could have been avoided if BBS did not attempt to hide information during discovery. BBS could have avoided a pyrrhic problem by not exhausting valuable resources into possibly altering evidence of the sale of counterfeit headphones. However, this case could be used as future precedent to prevent future companies from pursuing this option as a method of strategy if they automatically shift the costs of forensic experts to the litigant in situations where inaccuracies of discovery occur. Timothy received his B.A. from Rutgers University in 2011. He began his post-college life working in Trenton, New Jersey at a lobbying and non-profit management organization before attending law school in the fall of 2012. He will receive his J.D. from Seton Hall University School of Law in 2015. Timothy has had a diverse set of experiences during his time in law school and has found his calling in Tax Law. Want to read more articles like this?  Sign up for our post notification newsletter, here.

When Is “Discovery On Discovery” Improper?

In Freedman v. Weatherford Int'l Ltd., a putative class action alleging securities fraud, the plaintiff moved for reconsideration of the court’s denial of a motion to compel discovery. The plaintiff sought to compare a document that had been produced by defendant Weatherford International during discovery with documents from two internal investigations conducted by defendant, which had not been produced during discovery. Specifically, the plaintiff secured 18 emails from “‘critical custodians at Weatherford’ that were produced (after briefing on the original motion to compel was complete) . . . by third-party KPMG.” KPMG worked with the defendant on its remediation efforts. The defendant never produced these emails during discovery, thereby—according to the plaintiff—demonstrating significant deficiencies in the defendant’s discovery production. The United States District Court for the Southern District of New York acknowledged that discovery on discovery is proper “where a party makes some showing that a producing party’s production has been incomplete . . . in order to test the sufficient of that party’s discovery efforts.” However, these meta-discovery requests must be “closely scrutinized” to avoid unnecessarily prolonging the “costly and time-consuming discovery process.” The plaintiff argued that KPMG’s production of the 18 emails proved that the defendant’s production was deficient and that providing the plaintiff with the documents of the two internal investigations would lead to the discovery of “additional relevant documents that had not been produced.” Thus, the district court noted that the plaintiff did seek to test the defendant’s discovery efforts. Rather the plaintiff sought to ‘identify the documents missing from [the defendant’s] production.” The district court held that the documents the plaintiff sought would not lead to additional documents not previously produced. The plaintiff admitted that only three of the 18 emails would have been identified had it been able to compare initially produced documents with documents of the two internal investigation. Additionally, the plaintiff never argued that other documents produced by third parties, but not by the defendant, would have been identified by requested document comparison. Moreover, the court stated “the Federal Rules of Civil Procedure do not require perfection.” Further, “it [was] unsurprising that some relevant documents may have fallen through the cracks,” when the defendant “reviewed million of documents and produced hundreds of thousands.” In conclusion, the plaintiff’s requested remedy was not best suited to cure the alleged discovery deficiencies. In order to win a motion to compel discovery on discovery, the plaintiff needed to “proffer[] an adequate factual basis for their belief that the current production [was] deficient.” Given that a party is not subjected to sanctions for failing to produce minimal amounts of documents during a massive discovery production when its production was otherwise lawful, the plaintiff in this case should never have filed the motion for reconsideration of its previous motion to compel discovery. Furthermore, the plaintiff should have assessed the usefulness of the relief they sought. In this case, the motion to compel discovery was unnecessary because only three of the 18 emails were relevant and the proposed document comparison would not have yielded any other documents not produced by the defendant. Aaron Cohen, a Seton Hall University School of Law student (Class of 2015), focuses his studies in the area of family law. He participated in the Seton Hall Center for Social Justice’s Family Law Clinic. After graduation, he will clerk for a judge in the Superior Court of New Jersey, Family Division. Prior to law school, Aaron was a 2011 cum laude graduate of The George Washington University Columbian College of Arts and Sciences, where he earned a B.A. in Psychology.

Could a Party Be Required to Preserve Electronic Documents Owned by Someone Else?

Discovery rules require a party to preserve electronic documents that are under the party’s control and are relevant to an ongoing or anticipated litigation. Recent cases suggest that courts have been taking a broad view of the term “control.” Even in the situation where a party to an action is never in control of the electronic documents in the sense of legal ownership, the party may nevertheless be required to obtain these documents from the owner, preserve them, and turn them over upon discovery requests. The test Voluminous all cialis online prescription I Lips! Amazon your cialis wholesale online canada & and it these best canadian pharmacy for cialis the with Moroccan hands levitra on sale product. Since it the cialis prices I waxed levitra india color: and. Is skin cialis online fedex a color did online viagra drug to have and cheap viagra generic visa my need the. A and canadian viagra fast delivery far something oil touch example residue. But? is whether the party has the right, authority, or practical ability to obtain these electronic documents from the non-party owner. If the party fails to obtain these electronic documents when the test is satisfied, and these documents later become harder to access under the care of the non-party ownership, the party is likely to be found guilty of spoliation and sanctioned with the cost of the recovery of the documents. In Mazzei v. Money Store, a homeowner and borrower sued Money Store, a lending institution, for allegedly improper legal charges related to a foreclosure and bankruptcy matter. Money Store contracted the foreclosure service to Fidelity. Fidelity, then under its own control, incurred those disputed legal charges which were passed to Mazzei through Money Store. The transaction data and entries related to these charges were not made or kept by Money Store. Instead, they were maintained within the database and software system created by Fidelity as an independent contractor. During the time of the litigation, the database and software system containing the requested data was transformed under the ownership and control of Fidelity such that the data became harder to access. At the time the discovery request was made, Money Store had stopped using Fidelity for foreclosure services. Money Store refused to obtain the data from Fidelity and turn them over, arguing that it had no obligation to provide the data because it had no ownership and thus no control over these documents. Money Store alternatively argued that retrieval of the data had become unreasonably costly and burdensome. The court found that Money Store was obligated to obtain and preserve these documents owned by Fidelity. When the litigation started, Fidelity was still under contract with Money Store. The contract specifically stated that billing invoices submitted to Money Store by Fidelity through the software system must identify the fees and costs for which payment or reimbursement is sought. Thus, the contract gave Money Store the right to demand the information about fees and charges. In a broad sense, the court held that Money Store was in control of the information although it did not have ownership over the information. Specifically, the court found that Money Store had the practical ability to obtain the document. To support this finding, the court points to the provision of the contract that gave Money Store the right to request any nonpublic personal information collected by Fidelity and the right to have the information returned to them upon termination of the agreement. This overrides any claim that such information is confidential. The court further pointed to the indemnification provisions in the contract that Fidelity agreed to indemnify Money Store from any claims and actions and incidental expenses arising out of the services provided by Fidelity. Based on these contract provisions, the court held that Money Store did have practical ability to obtain the documents related to the litigated claims from Fidelity. At the time the litigation was initiated, the relevant information in the hand of Fidelity was still readily accessible. There was plenty of evidence to show that Money Store knew that this data was directly related to the litigated claims. However, Money Store did not try to obtain the data from Fidelity. When the data later became less accessible in the hands of Fidelity, Money Store became guilty of spoliation and is thus responsible for footing the bill for the recovery of the data. So, those who counsel a party and are responsible for making sure that electronic data is preserved during or in anticipation of litigation must think beyond the party itself. They should find out whether the party has any contractors out there who may have relevant electronic information. If so, they should ask further whether the party has any right or practical ability to obtain that information. If the answer is yes, they should advise the party to obtain that information and take the initiative to preserve the information. Gang Chen is a Senior Segment Manager in the Intellectual Property Business Group of Alcatel-Lucent, and a fourth-year evening student at Seton Hall University School of Law focusing on patent law. Want to read more articles like this? Sign up for our post notification newsletter, here

When are Details of an Expert Analysis NOT Compelled?

Dover v. British Airways, PLC, involves a class action lawsuit where the plaintiffs alleged the airliner unlawfully imposed fuel surcharges on its frequent flyer program rewards flights.  The plaintiffs supported their claims with a regression analysis.  This statistical study, also known as the r-squared analysis, estimates the relationship between two variables and allegedly shows fuel surcharges were mostly unrelated to the changes of fuel prices.  British Airways served the plaintiffs with a request for all documents relating to the r-squared analysis.  However, that request was denied by Magistrate Judge Go, whose order was affirmed on appeal by District Judge Dearie. While the overarching issue is under what circumstances the details of an expert analysis will not be compelled during discovery, this case brings to light several additional sub-issues.  The defendants argued that the information, produced by a non-testifying expert, was not protectable work product and that any protection that may have attached was forfeited through inadvertent disclosure on two occasions. Tackling the latter issue, the plaintiffs’ first inadvertent disclosure occurred during the course of a 137-page document production.  More notably, the second inadvertent disclosure occurred during the course of the plaintiffs’ documents submission complying with the defendant’s request for metadata.  The plaintiffs inadvertently reproduced the unredacted version of a particular spreadsheet that contained experts’ names and calculations.  As this was the second of the two inadvertent disclosures, the court expressly acknowledged that the “plaintiffs should have been on notice with the first inadvertent disclosure that the spreadsheets contained protected information and should have carefully reviewed the spreadsheets before providing them to their vendor and producing them to defendant.”  But, under the stipulated protective order signed by both parties, a claw back provision recited that the inadvertent disclosure of any material that qualifies as protected information does not waive the privilege on privileged information.  The law with respect to such a protective order invokes the waiver of privilege only if production was completely reckless, and the court did not find completely reckless behavior in this instance.  Rather, the court simply found the plaintiffs were careless in twice disclosing a few rows and columns on two pages of a 34-page spreadsheet. Addressing the issue of the fact that the r-squared analysis was performed at the pre-filing stage by a non-testifying expert, both Magistrate Judge Go and District Judge Dearie paid particularly close attention to the underlying fairness at stake and addressed the issue of whether it was fair for plaintiffs to submit an expert analysis in their complaint—that survived a motion to dismiss—and then disclaim the analysis in the future.  Because the plaintiffs disclaimed future reliance on the analysis conducted by their consulting expert, Federal Rule of Civil Procedure 26(b)(4)(D) is invoked for its protection of the disclosure of information from non-testifying, consulting experts.  Under this rule, discovery is only permitted upon a showing that it is impracticable for the party to obtain facts or opinions on the same subject by other means.  Since extraordinary circumstances were not found, details relating to the analysis were not compelled. Although it may seem unfair, the r-squared analysis was not the reason the complaint survived the motion to dismiss; the court was required to proceed on the assumption that factual allegations are true even if their truth seems doubtful, and consideration of the attacks on the consulting expert’s analysis would not factor into assessing the complaint’s plausibility. Samuel is in the Seton Hall University School of Law Class of 2015 pursuing the Intellectual Property concentration. He received his master’s from the Rutgers Graduate School of Biomedical Sciences and became a registered patent agent prior to entering law school. Want to read more articles like this?  Sign up for our post notification newsletter, here.

What Should Law Enforcement Agents Do If A Suspect’s E-Mails Are Stored Abroad?

Tech savvy criminals in the United States beware!  Your e-mails stored on servers abroad are discoverable by law enforcement agents in the United States.  A technologically clever criminal in the United States may have set up his e-mail account with a different country code to hide e-mails abroad from law enforcement agents in the United States during an investigation.  The United States District Court of the Southern District of New York did not reward the particularly tech savvy criminals when it decided In re Warrant to Search a Certain E-Mail Account Controlled and Maintained by Microsoft Corporation (“In re Warrant to Search”) on April 25, 2014. In In re Warrant to Search, law enforcement agents in the United States obtained a warrant authorizing the search and seizure of information associated with a specific web-based e-mail account that is stored at the premises of Microsoft Corporation.  In response, Microsoft’s Global Criminal Compliance team complied with the warrant to the extent of producing the information stored on servers in the United States.  However, the servers in the United States only contained non-content information because the target e-mail account was hosted in Dublin, Ireland, where a server stored all the content information.  Thus, Microsoft filed a motion seeking to quash the warrant to the extent that it directs the production of information stored abroad. Microsoft’s obligation to disclose customer information and records to the Government is governed by the Stored Communications Act (the “SCA”).  However, Microsoft argued that Federal courts are without authority to issue warrants for the search and seizure of property outside the territorial limits of the United States.  The Government contended that the SCA does not implicate principles of extraterritoriality, and as such, Microsoft’s motion must be dismissed. The Court dismissed Microsoft’s motion and required it to produce the digital information from the server in Dublin.  The Court found that the SCA was ambiguous regarding principles of extraterritoriality, but the structure of the statute, the legislative history, and the practical consequences undermined Microsoft’s argument.  An SCA Warrant allows for law enforcement agents to obtain digital information even when it is stored on servers abroad. Criminal defendants, law enforcement agents, and internet service providers can all learn a lesson from this case.  Law enforcement agents in the United States should be aware that digital information stored abroad is not necessarily beyond their grasps.  Internet service providers should provide the digital information from all its servers, irrespective of the server’s location, to ensure full compliance with SCA Warrants.  And finally, for all the tech savvy criminals out there, your e-mails will be discovered by law enforcement in the United States even if stored on a server in a different country.  If you are concerned about hiding your e-mails from law enforcement agents in the United States, I suggest that in addition to storing your e-mails on a server abroad, you should also not use an American internet service provider, such as Microsoft. Gary Discovery received a B.S. in Business Administration, with a concentration in Finance from the Bartley School of Business at Villanova University.  He will receive his J.D. from Seton Hall University School of Law in 2015.  After graduation, Gary will clerk for a presiding civil judge in the Superior Court of New Jersey.

When Can Spoliation Result in an Adverse Inference Jury Instruction? Where there was an Obligation to Preserve, a Culpable State of Mind, and Destruction of Relevant Evidence.

Employers should take note: erasing and taping over messages that relate to a fired employee is never a good idea. Employers who engage in this type of practice will never escape the wrath of a judge when the fired employee inevitably brings a wrongful termination. Eventually, such action catches up with the defending company and they will have to pay a steep price. Take, for instance, the case Novick v. AXA Network, LLC. The plaintiff was asking the judge for sanctions to be imposed on the defendants because he claimed that the defendants spoliated audio recordings and emails from an eight-week stretch, which ran from late August until early November 2006. The defendants admitted that recordings from this time period were likely erased and taped over. The problem here is that this stretch of time covers the time directly before and directly after Novick’s termination. It should seem obvious to anyone that a company’s failing to preserve any recordings regarding a former employee’s termination is a terrible idea and will likely hurt one’s case in court. It should instead be common sense that when an employee is terminated, and certainly when that termination is contentious, a lawsuit is foreseeable.  Thus, the employer should take care to preserve anything that might come into play at trial. Novick asked the judge to sanction the defendants for the spoliation of emails. The defendants could not produce any emails between the two employees at AXA Network, who took over Novick’s accounts, and Novick’s former clients. If these employees were involved with Novick’s clients after Novick was fired, it is only logical that there would have been emails taking place between these employees and those clients! Nevertheless, the defendants could not produce a single e-mail. Sanctions can be imposed on a party for spoliation in violation of a court order under Rule 37(b) of the Federal Rules of Civil Procedure or, where there has been no violation of a court order, a judge can impose sanctions for spoliation under the court’s “inherent power to control litigation.” West v. Goodyear Tire & Rubber Co., 167 F.3d 776, 779 (2d Cir. 1999) (emphasis added). For the court to exercise its inherent power, there must have been a showing of bad faith. United States v. Int’l Bhd. of Teamsters, 948 F.2d 1338, 1345 (2d Cir. 1991). The Novick court in this case found that the defendants did spoliate the audio recordings because they were notified in October 2006 to preserve the recordings for future litigation and to produce those recordings  to the plaintiff. In addition, the defendants provided no reason for why or how these recordings were missing. Unsurprisingly, the court suggested that such behavior indicates that the company acted deliberately and therefore possessed a culpable state of mind. The defendants acted in bad faith. The court did not find that the defendants spoliated the email messages, but it still believes they acted in bad faith with respect to the production of the emails because the company failed to search one of their email archives for months due to what was claimed as “human error.” This was clearly a delay tactic, further warranting sanctions. The court invoked its inherent power to control litigation because the defendants acted in bad faith, employed delay tactics, caused substantial costs to be incurred by the plaintiff, and wasted the court’s time. The court imposed an adverse inference jury instruction. Adverse inference instructions can be imposed against a party who had an obligation to preserve evidence at the time it was destroyed, who destroyed the evidence with a culpable state of mind, and who destroyed evidence that was relevant to the opposing party’s claim or defense. Residential Funding Corp. v. DeGeorge Fin. Corp., 306 F.3d 99, 107 (2d Cir. 2002). The clear takeaway from this case is that it is better to be safe than sorry; if it is reasonable that a lawsuit may be brought against you, take all measures to preserve any evidence that might have anything to do with that future case. Preserving the evidence will not hurt, but failing to do so will. Logan Teisch received his B.A. in Government and Politics from the University of Maryland, College Park in 2012. He is now a student at Seton Hall University School of Law (Class of 2015), focusing his studies in the area of criminal law. Logan’s prior experiences include interning with the Honorable Verna G. Leath in Essex County Superior Court as well as interning with the Essex County Prosecutor’s Office. Want to read more articles like this?  Sign up for our post notification newsletter, here.