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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.
In a case dealing with gender discrimination between female employees and a large advertising conglomerate, the plaintiffs filed claims against the defendants under Title VII of the Family and Medical Leave Act, the Equal Pay Act, the Fair Labor Standards Act, and similar New York labor laws. After the plaintiffs objectioned to the defendants’ use of computer-assisted review and search method, United States Magistrate Judge Andrew J. Peck opined that computer-assisted review is an acceptable search method for relevant ESI in appropriate cases. Throughout his opinion, Judge Peck referred to articles and public statements he had made prior to the case on his beliefs of the value of computer-assisted review. Judge Peck explains his interactions with the two parties involved started at the first discovery conference, which took place on December 11, 2011. While, both parties had discussed ESI protocol, the plaintiffs were reluctant to accept the defendant’s utilization of predictive coding to gather the relevant documents among the three million electronic documents from the agreed-upon custodians. In a later discovery conference, the court refuted the defendants’ proposal to cutoff production at the most relevant 40,000 documents due to expense, explaining that proportionality must consider cost and results in gathering the most likely highly responsive documents. The court went on to agree with the defendants on other factors concerning document production and custodians due to the fact that the plaintiffs could not give meaningful reasons for the inclusion of other custodians and emails or assert a likelihood that the information could be found through other reasonable discovery procedures. On February 8, 2012, after going through the main issues that were holding up the discovery process, Judge Peck acknowledged that the defendants agreed to provide the plaintiffs with all seed documents and protocol in determining relevant ESI throughout the computer-assisted review process. With that knowledge, Judge Peck accepted the proposal that defendants submitted to the plaintiffs and the court for producing relevant ESI, and acknowledged that computer-assisted review was an efficient and officially judicially approved method for ESI protocol and production when given the appropriate case. On February 8, 2012, the plaintiffs filed an objection to the court’s ruling.
How many readers are familiar with a class action suit? Do class actions suits seem to be never ending and broad? What is the scope of such suits? In Oppenheimer Fund v. Sanders, the United States Supreme Court addressed the issue of a class action lawsuit in regards to compiling the names and addresses of the members of the class. A class action was brought against Oppenheimer Fund, an open-end diversified investment fund that sells shares to the public at their net asset value plus a sales charge. The respondents bought shares at various times and filed complaints that the shares in the Fund were artificially inflated as they had been overvalued on the Fund’s books. As a result a class action suit was filed. The respondents sought to require the Fund to help compile a list of the names and addresses of the members of the plaintiff class from records kept by using a transfer agent so that individual notices could be sent. The respondents essentially were seeking information about 121,000 people. Of this large number, 103,000 individuals still had shares in the Fund, while 18,000 others had sold their shares. Gathering this information would be time-consuming, as the transfer agent would have to manually sort through paper files. The Second Circuit held that the discovery rules authorized the district court to order the petitioners to assist the respondents in compiling this list of members of the respondent class and to bear the expenses of compilation. The issue was brought before the Supreme Court, which reversed the lower court’s holding, finding that it was an abuse of discretion of the court to require petitioners to bear the expenses of compilation. Here, the respondents could easily hire the transfer agent as a third party to compile the list by paying the agent the same amount that petitioners would have to pay. The Court reasoned that this information must be obtained to comply with the obligation of the respondents’ to prove notice to their class. Additionally, no special circumstances were presented to warrant requiring petitioners to bear the expense. The Court noted that a mere allegation of wrongdoing is an insufficient reason to require the Fund to undertake the financial burdens and risks in compiling the list. Overall, the lesson to be learned here is that in class action lawsuits, where the information sought can be obtained at the same cost to either party, it is the respondents who will bear these expenses to identify members of their own class. Jennifer Whritenour received her B.S. in Political Science and History in 2011 from the University of Scranton. In 2014, Ms. Whritenour graduated from Seton Hall University School of Law.
On July 31, 1996, plaintiff Omega Engineering Corp. ("Omega"), a New Jersey based company, lost its computer programs relating to design and production permanently from its system. Omega manufactured “highly specialized and sophisticated industrial process measurement devices and control equipment” for NASA and the United States Navy. The deletion of these programs debilitated their ability for manufacturing as well as costed the company millions of dollars in contracts and sales. From 1985 to July 10, 1996, defendant Timothy Lloyd worked as the computer system administrator at Omega. He trained with the Novell computer network and installed it to Omega’s computer system. The program worked to ensure that all of Omega’s documents could be kept on a central file server. Lloyd was the only Omega employee to maintain the Novell client and have “top-level security access” to it; however, the defense asserted that others at the company had access. According to a government expert, access "means that ... [an] account has full access to everything on the server." Lloyd was also the only employee in charge of backing up the information to the server. In 1994 or 1995, Lloyd became difficult. The company moved him laterally in hopes of improving his behavior. A government witness testified that even though it was a lateral move, it was in fact, considered a demotion by the company. Lloyd’s new supervisor asked him about the back-up system and wanted him to loop a couple more people in but he never did. Moreover, he instituted a company-wide policy that employees were no longer allowed to make personal backups of their files. On top of the above issues, there was also a “substandard performance review and raise.” The combination of the two factors, according to the government, showed Lloyd that his employment with the company would soon be terminated. This established Lloyd’s motive to sabotage the Omega computer system. On July 10, 1006, Lloyd was terminated. On July 31, 1996, Omega’s file server would not start up. On July 31, “Lloyd told a third party, that "everybody's job at Omega is in jeopardy.” days later it was realized that all of the information contained on it were permanently lost. More than 1,200 of Omega’s programs were deleted and, as per Lloyd’s policy, none of the employees had their own personal backups. There was no way for any of these programs to be recovered. A search warrant conducted on Lloyd’s house turned up some backup tapes and a file server master hard drive. Experts hired by Omega found that the deletion of information was “intentional and only someone with supervisory-level access to the network could have accomplished such a feat.” The commands necessary to pull off such a purge were characterized as a “time bomb” set to go off on July 31st when an employee logged into the system. There was evidence found by these experts of Lloyd testing these specific commands three different times. This string of commands was further found on the hard drive that was in Lloyd’s home. Lloyd was convicted of a federal count of computer sabotage. It was remanded due to a jury member’s claimed use of outside knowledge during deliberations. Julie received her J.D. from Seton Hall University School of Law in 2014. Prior to law school, she was a 2008 magna cum laude graduate of Syracuse University, where she earned a B.A. in History and a minor in Religion and Society. After law school, Julie will serve as a law clerk to a judge of the Superior Court of New Jersey.
In Timken Co. v. U.S., the plaintiff ("Timken" or "Plaintiff") challenged the decision of the Department of Commerce, International Trade Administration ("Commerce"), denying Plaintiff access to computer tapes submitted by defendant-intervenors (the "Defendant") in a complex trade case. Timken sought the tapes notwithstanding that it had received the very same information in paper form. Plaintiff advocated its position by discussing the hardship that would be imposed if Plaintiff had to reproduce the tapes itself. Plaintiff demonstrated that it would require 7,500 man-hours and a legion of "keypunchers," at a total cost of approximately $200,000 to duplicate what Commerce already had in its possession. With respect to the need for the tapes, Plaintiff indicated that without the tapes it would not be able to identify factual errors in the data and other mathematical or methodological errors. Commerce countered the above points by arguing that if it had to supply the tapes, it would have to expend significant energy insuring that customer names had been deleted and assisting Plaintiff with mechanical problems that may arise. Commerce also asserted that if it was compelled the tapes companies would be less likely to store information on tapes moving forward, to prevent disclosure. In reviewing the merits, the Court of International Review applied the standard expounded in the applicable legislative history; that is, "whether the need of the party requesting the information outweighs the need of the party submitting the information for continued confidential treatment." The court first concluded that the cost factored weighed in favor of Plaintiffs. Not only were Plaintiff’s costs to reproduce high, but also Plaintiff was willing to offset any costs to Commerce. This process also minimized the involvement, and therefore the burden, of Commerce. With respect to the argument that the tapes were required by Plaintiff to independently analyze the data, the court found that access to the tapes was essential for effective advocacy, and that such work by Plaintiff would not constitute a "duplication of administrative functions." Finally, the Court dismissed Commerce's argument that companies would no longer maintain data on tape: "[I]t is unlikely that the mere possibility of trade litigation in the United States would prompt foreign exporters to return to archaic business procedures." Although not articulated as such, the court engaged in a proportionality analysis typically applied to discovery disputes in federal courts. Plaintiff's willingness to offset the costs to Commerce seemed to sway the court, just as it would in a typical discovery dispute. Another principle to be extracted from this case is the value inherent in having data in a particular form. This may be an area where practitioners miss the boat. A savvy e-disco attorney will know the ins and outs of how different forms of data can be manipulated, and the form most ideal for recovering (or inhibiting recovery) of particular information. So practitioners should remember at their next meet and confer, just getting the information may not be enough—form may be critical. Adam L. Peterson is a graduate of Seton Hall University School of Law. Adam was a member of the Seton Hall Law Review and, prior to law school, Adam was an Environmental Analyst with the New York State Department of Environmental Conservation.
This case involves a contractual dispute worth $41 million between Juster and North Hudson Sewerage Authority (NHSA). Juster issued a request for production of documents that included 49 requests for documents and a list of 67 proposed search terms. Some of these terms included words such as “fee,” “debt,” “tax,” and “SEC.” NHSA argues that the court should grant a protective order because it already produced 8,000 pages of documents and felt these search terms were too vague. Additionally, NHSA stated that if the court did not grant its protective order, the cost for producing these documents and running the searches should be shifted to Juster. The court did not agree with NHSA’s claims. Not only was there a lack of evidence that the data requested here was inaccessible, the court also applied the seven-factor test set forth in Zubulake v. UBS Warburg. This case has been adopted by the Third Circuit in cases that involve fee shifting. The Zubulake factors include: The extent to which the request is specifically tailored to discover relevant information; The availability of such information from other sources; The total cost of production, compared to the amount in controversy; The total cost of production; The relative ability of each party to control costs and its incentive to do so; The importance of the issues at stake in the litigation; and The relative benefits to the parties of obtaining the information In applying the Zubulake factors to this case, the court held that fee shifting is not warranted. The requests for electronically stored information (ESI) were tailored, as the searches were restricted to a specific time period (2011-2012). Second, it is unknown if this information is available from other sources. The third, fourth, and fifth factors are concerned with the costs associated with the request for ESI. Here, the court found that given the amount of damages at stake, NHSA’s ability to absorb the costs of the ESI requests, and the projected costs are not substantial enough to justify fee shifting. The fact that the litigation had $41 million at issue and the cost of running the keyword searches was approximately between $6,000 and $16,000, the court felt fee shifting would be inappropriate. The final factors are not relevant to this litigation as this is a private contractual dispute between two parties and no public policy is implicated. Overall, these factors weigh heavily in favor of Juster. As a result, this case illustrates that courts are reluctant to sway from the idea that it is the responding party that bears the costs in complying with discovery requests. Only when there is an undue burden on the responding party, or inaccessibility of information, will the court consider fee shifting. Yet, given today’s society, most information is accessible. Additionally, when both parties have comparable discovery requests and both agree to pay their own costs in producing discovery, fee shifting is even less likely to occur. Jennifer Whritenour received her B.S. in Political Science and History in 2011 from the University of Scranton. In May 2014, she received her J.D. from Seton Hall University School of Law.
The defendant in personal injury litigation commonly requests discovery concerning a plaintiff’s Facebook account. The reason such requests are made is that pictures on Facebook may reveal the “injured” plaintiff dancing on top of a bar table, skiing, traveling, etc. These damaging photos may prove that the plaintiff’s injury is not as severe as he or she claims and could result in dismissal of the case. Therefore, it is not uncommon for a plaintiff to delete his or her Facebook account in order to conceal any damaging pictures. The deletion of a Facebook account, however, may result in sanctions such as an adverse inference jury instruction. In Gato v. United Airlines, Inc., the plaintiff was injured while working for the defendant. During the litigation, the plaintiff permanently deleted his Facebook account. The defendant motioned for an adverse inference jury instruction claiming that the deletion of the Facebook account destroyed relevant evidence, thereby prejudicing the defendant. In granting the sanction, the district of New Jersey adopted a very low standard as to what a litigant must show in order to obtain an adverse inference jury instruction. The court held that “so long as evidence is relevant, the offending party’s culpability is largely irrelevant, as it cannot be denied that the opposing party has been prejudiced.” This seemingly simple sentence has enormous implications for litigants in the district of New Jersey for two reasons. First, it means that as long as the destroyed evidence was relevant, a litigant need not prove that the adversary intentionally (or even negligently) destroyed evidence. The lack of state of mind requirement eliminates what is often the most difficult element to prove when seeking spoliation sanctions. Without the need to prove a litigant’s culpability in destroying the evidence, the court seems to impose a form of strict liability upon the destroying party. The only requirement imposed by the court is that the party seeking sanctions prove that the destroyed evidence was relevant. This is a significant deviation from the traditional method employed by courts which requires proof that a party was at least negligent in destroying the evidence. Second, the court indicates that as long as the evidence is relevant, it will presume that the destruction of the evidence was prejudicial to the opposing party. This eliminates the need for the party seeking sanctions to prove that it was prejudiced by the missing evidence. Instead, the party only needs to prove that the evidence was relevant. Notably, the court explained that the defendants in Gato were “prejudiced because they have lost access to evidence that is potentially relevant to Plaintiff’s damages and credibility.” In other words, the defendant in Gato did not have to even prove that the destroyed evidence was undoubtedly relevant—the defendant only had to prove that the evidence was potentially relevant. In sum, the District of New Jersey imposed an adverse inference jury instruction simply because the destroyed evidence was potentially relevant to the litigation. The court did not require the defendant to show that it was prejudiced by the destruction, nor did the court require any showing as to the Plaintiff’s state of mind in destroying the evidence. Moving forward, litigants must be extra careful in their efforts to preserve evidence relevant to litigation. E-DiscoParty, a Seton Hall University School of Law graduate (Class of 2014), served on the executive board of the Seton Hall Law Review and is a member of the Interscholastic Moot Court Board. Currently, E-DiscoParty clerks for a Justice on the Supreme Court of New Jersey.  An adverse inference jury instruction is a powerful sanction where the court advises the jury to presume that any destroyed or missing evidence contained detrimental information about the party that destroyed or lost the evidence.
Background Omega Engineering Corporation, an international company based in New Jersey, was once the employer of Timothy Lloyd. To put Omega’s importance into perspective, the U.S. Navy and NASA were two of their clients for highly specialized and sophisticated industrial process measurement devices. According to testimony during the trial, Lloyd worked at Omega as its sole system administrator from 1985 through 1996. In 1995, Lloyd had undergone Novell network training and installed Novell software on Omega’s computer system. Additionally, Lloyd was the only person who maintained and had top-level access to the Omega network. Between 1994 and 1995, Lloyd became belligerent and increasingly truculent. Due to his poor interpersonal skills, he was demoted in May 1995 from manufacturing to support engineer. A woman who had once been Lloyd’s subordinate and had engaged in a romantic relationship with Lloyd, was the individual responsible for replacing Lloyd as manufacturing supervisor. In June 1996, Lloyd instituted a policy to “clean up” all of the individual computers in Omega’s manufacturing department. It was unclear as to why Lloyd was implementing company policies after his demotion. Nonetheless, the policy required employees to save their files to the company’s file server and prohibited them from making their own backups. Lloyd’s manager became suspicious of this policy and requested from Lloyd access to the file server. Lloyd never complied. By the end of June, upper management had enough of Lloyd’s behavior and terminated him in early July 1996. On July 31, Omega’s file server would not boot up. All of Omega’s manufacturing programs on the server, which contained instructions for operating the machines, were gone. Multiple computer experts were brought in to recover the files, but to no avail. The files had not only been deleted, but also had been “purged,” meaning that they were rendered unrecoverable. A leading expert on Novell networking testified at trial that this could only have been done intentionally and by someone with supervisory-level access. The government’s theory included that on July 30, anyone who would log on to the server at any time after that date would “detonate” a program installed by Lloyd that would destroy the information on the Omega file server. The government’s theory was bolstered by the fact that the Secret Service recovered missing Omega backup tapes that had been reformatted as well as a master hard drive from the file server. This had the same string of commands that had functioned as the time bomb program found on the Omega file server. The Decision Ultimately, Lloyd was found guilty of computer sabotage. The jury had deliberated for over twelve hours over the span of three days and had requested testimony in the jury room before they reached their verdict. However, three days after the verdict, one juror said that she had seen on the news, during the trial, about a computer virus called the Philippine “love bug” which allowed the perpetrator to cause great harm by flooding the victim computers and causing them to crash. Whether this affected her decision is unclear; however, the defendant claimed that his 6th Amendment rights had been violated. The district court agreed, granting a new trial. On review, the Court of Appeals reversed the district court’s holding. After a lengthy discussion, the court said that there were significant dissimilarities between the “love bug” and the “time bomb” and most jurors would not confuse the two. Therefore, the appellate court found, the defendant was not prejudiced. Lloyd’s managers should never have allowed a single employee hold as much power as they did. This case highlights the vulnerabilities the company subjects itself to if that is allowed to happen. For example, Omega lost over 1,200 programs and many current and potential clients as well. Akiva Shepard received his J.D. from Seton Hall University School of Law in 2014. Akiva has worked for a New York State Supreme Court Judge in Kings County, and for a NJ real estate firm.
Plaintiff Erick Zayas joined with the Equal Employment Opportunity Commission (EEOC) to sue Ventura Corp. for employment discrimination on the basis of sex in 2007. In essence, Zavas complained that Ventura’s long-standing tradition of hiring women for the position he applied to was discriminatory. Furthermore, Zavas alleged that Ventura destroyed relevant evidence. In its answer, Ventura stated that the fact that no men have filed applications or have not met the position requirements did not support the plaintiffs’ assertion of discrimination. However, during limited discovery a list revealed that qualified men did in fact apply and accounted for 34.5 percent of qualified applicants. The central issue involved application materials received by Ventura. These included materials submitted by e-mail and hard copy resumes. The court first notes that spoliation is “the failure to preserve evidence that is relevant to pending or potential litigation.” The duty to preserve relevant evidence arises once litigation is reasonably anticipated. The court noted that since Ventura was notified in 2007 that it was being charged with sexual discrimination, at that point Ventura should have reasonably anticipated litigation and was thus under the duty to preserve. Ventura attempted to make a statutory argument that resumes did not need to be preserved. The relevant statute, 29 CFR 1602.14 (see http://www.law.cornell.edu/cfr/text/29/1602.14), makes reference to “application forms” and “test papers.” Ventura argued that it required neither application forms nor test papers and that resumes were not mentioned. However, the court rejected this argument. The court noted that the statute also includes the language, “other records having to do with hiring.” The court ultimately held that resumes therefore clearly applied. Ventura’s Human Resource Analyst testified that certain documents were shredded or taken to a warehouse as a result of an office restructuring in 2009. Furthermore, the HR Analyst wasn’t able to find the said documents. The plaintiffs were therefore able to establish that Ventura either lost or destroyed the resumes between 2007 and 2010. Because Ventura was on notice since 2007, the disappearance of these documents constituted a violation of its duty to preserve relevant evidence. Soft copies of resumes delivered by e-mail were also lost in the same time period. In fact, th plaintiffs were able to produce a relevant e-mail to and from Ventura, while Ventura was not able to produce the very same e-mail. This e-mail alone and the fact that other relevant e-mails likely existed in the 2007-2010 period but were nowhere to be found, was sufficient to infer that Ventura likely destroyed them. The court held that sanctions were in order for Ventura’s violation of its duty to preserve. As a result of Ventura’s failure to preserve relevant evidence, the court imposed a “spoliation instruction” or adverse inference instruction. Such an instruction allows the trier of fact to infer that the content of the destroyed relevant evidence was damaging to Ventura’s case. Lesson learned? If you intentionally or unintentionally destroy relevant evidence while under a duty to preserve, an adverse inference instruction will likely bring swift defeat and sway the trier of fact against you. It’s best to preserve evidence and maintain your credibility with the court and trier of fact even with bad facts. Rocco Seminerio is a Seton Hall University School of Law graduate (Class of 2014). Mr. Seminerio focuses in the areas of Estate Planning, Elder Law, and Health Law. He graduated from Seton Hall University in 2011 with a degree in Philosophy. He also has an interest in the life sciences.
Richard Fraser was an independent contractor working for Nationwide Mutual Insurance Company when he was fired in 1998. Although Fraser argued that he was fired for reporting illegal policies that Nationwide had implemented, Nationwide stated he was fired because he was disloyal to the company. Nationwide found that plaintiff had drafted (but not sent) two letters to two Nationwide competitors, Erie Insurance Company and Zurich American Insurance, expressing Contractors Association members' dissatisfaction with Nationwide and seeking to determine whether Erie and Zurich would be interested in acquiring the policyholders of the agents in the Contractors Association. After discovering the letters, Nationwide also searched its mail file server and found e-mails revealing company trade secrets. Fraser filed a wrongful termination suit against Nationwide, arguing that Nationwide’s accessing Fraser’s e-mail account without permission violated the Electronic Communication Privacy Act and a parallel Pennsylvania statute. The trial court granted Nationwide’s motion for summary judgment and Fraser appealed. The Third Circuit Court of Appeals affirmed the trial court’s ruling that Nationwide had access to the independent contractor’s emails. Nationwide was found to not have violated the ECPA because Nationwide had provided the independent contractor with the e-mail account, the e-mail was hosted on Nationwide’s servers, and the e-mails were acquired after transmission of the e-mails. Therefore, the court held that the e-mails were not intercepted by Nationwide. Title 1 of the ECPA prohibits the interception of e-mails, but Nationwide argued that since the e-mails were reviewed after the transmission of the e-mail, that no interception had occurred. The court agreed and found that for one to intercept e-mail, he must occur contemporaneously, at the time of the transmission. Therefore, as long as the seizure of e-mail occurs after the e-mail is transmitted, a company does not need permission to access the independent contractor’s e-mails. Salim received his B.A. in Applied Communications, with a minor in Legal Studies, from Monmouth University. He received his J.D. from Seton Hall University School of Law in 2014. Salim’s past experiences include interning for a personal injury law firm prior to attending law school, as well as judicial internships in the Civil and Family Divisions.