Authored By: Edward J. Piasecki

Citation: Terraphase Engineering, Inc., et al. v. Arcadis, U.S., Inc. U.S. District Court for the Northern District of California

Employee/Employer Implicated: In-House and Outside Counsel

e-Lesson Learned: If counsel inadvertently receives an email containing privileged information, reads it, and fails to notify the sender, counsel may be disqualified.

Tweet This: Finders Keepers? What Not to Do With Inadvertently Received Privileged Information

Ever find something you knew did not belong to you, but kept it anyway? If you have, perhaps you did so under the guidance of the old adage “Finders keepers, losers weepers.” The adage can be applied in a multitude of ways to a variety of things. One of the more humorous situations in which this occurs is via the receipt of an inadvertently sent email. Perhaps a colleague, thinking he was writing to his wife, inadvertently sent you an email about shopping at Bed, Bath, and Beyond. Or perhaps another colleague inadvertently hit reply all to an email belittling his boss. If you have spent anytime in the workplace, scenarios like these are all too familiar. When you receive an email like this, it may be the greatest gift the office humor gods can bestow upon you and it must be opened immediately and maybe even saved to embarrass a colleague at some later date. Finders keepers, losers weepers right? Unfortunately, this is not always so. When legal counsel inadvertently receives an email with privileged information, finders keepers can have dire consequences.

Authored By: Drew Manary

Citation: Radian Asset Assurance, Inc. v. College of Christian Brothers of New Mexico (2010).

Employee/Employer Implicated: Plaintiff (Radian), defendant (College of Christian Brothers of New Mexico) and subsequent owner of defendant’s assets, Laureate Education, Inc.

e-Lesson Learned: If a defendant is compelled to produce unreviewed ESI, defendant shall have to pay for production but plaintiff shall pay for review. Additionally, if privileged information is transferred inadvertently from defendant to plaintiff, the defendant has burden of proving the information was privileged.

Tweet This: Forcing D's to pay for ct-ordered production isn't unreasonable, nor making them est. the inadvertent transf of privl. information

Radian initially filed suit against College of Christian Brothers in September 2009. Two days the filing, defendant (“College”) sold its assets to Laureate Education. As early as March 2010, College subpoenaed Laureate Education for materials obtained in the sale. In August 2010, College received 135 hard drives, 52 backup tapes, and an additional hard drive with information from Laureate Education’s current server. Radian and College had been to court several times over ESI. In September 2010, the Court ordered that College search and produce email from certain tape backups as well as producing 1,219 files Radian had assessed as relevant from Laureate Education’s current hard drive. The dispute in the present matter is whether College should be forced to restore the tape backups and review them at their own expense and whether doing otherwise constitutes unreasonable cost-shifting. Radian makes five arguments in support of this proposition.

Authored By: Jessica K. Rauskolb

Citation: In re Grand Jury Subpoenas, 627 F.3d 1143 (9th Cir. Cal. 2010)

Employee/Employer Implicated: Government official, Outside counsel, Miscellaneous

e-Lesson Learned: Non-privileged information originating outside the U.S. that you had to produce as a result of discovery from a civil antitrust suit can get into the hands of a grand jury and be used against you in an antitrust investigation.

Tweet This: Note, discovery in civil litigation can move information within the grasp of the grand jury - and there is nothing you can do about it.

Be careful when you defend a civil suit that was triggered by a government investigation! When you respond to discovery requests and produce material which was previously not within the reach of the grand jury, the government can subpoena these documents! A civil protective order will not do you any good! The defendants in In re Grand Jury Subpoenas had to find that out the hard way.

Authored By: M.J.R.

Citation: Jannx Medical Systems, Inc. v. Methodist Hospitals, Inc., 2010 WL 4789275 (N.D. Ind., Nov. 17, 2010)

Employee/Employer Implicated: Outside Counsel, In-house Counsel, Senior Management, information technology manager

e-Lesson Learned: Discoverable data must be produced in a reasonably usable form in which it is ordinarily maintained and not in a format more difficult for the requesting party to use in litigation.

Tweet This: Indiana Court hands down a harsh punishment for shady electronic discovery practices!

Not only was Jannx scolded by the District Court on three separate issues, they are now responsible for significant legal fees, and lost a motion to protect their own data. It’s safe to say the Indiana District Court was not impressed with the Jannx legal team. Basically, this case involves a dispute over pre-trial discovery motions between the plaintiff, Jannx Medical Systems and defendants, Methodist Hospital, Crothall Healthcare, Inc., and Propoco Professional Services. The Court issued an opinion and order on Defendant’s motion to get Jannx to comply with electronic discovery and Jannx’s motion to withhold electronic data from discovery by reason of trade secrets, etc.

Authored By: S.S.K.

Citation: Estate of Davis v. Spriggs, 2010 WL 4817348 (Delaware County Nov. 19, 2010)

Employee/Employer Implicated: Miscellaneous employees

e-Lesson Learned: Having an “Evidence Eliminator” program which destroys electronic data on a computer upon start-up can justify incidental deletion of evidence when your job involves sensitive information.

Tweet This: OH AppCt: It’s legal to destroy incriminating evidence on your computer! (Sometimes.)

Again with the scandalous sex tapes? Seriously? With all the publicity surrounding leaked sex tapes coupled with the prevalence and ease of digital communication, one cannot honestly believe such a tape will remain a well kept secret. You’ll receive no sympathy on this blog for your escapades, and you’ll receive no sympathy in the Ohio court system, either. In Davis v. Spriggs, Spriggs was suing her former husband (Davis) for posting pictures and video on an adult website after the divorce settlement, signed a few months prior, specifically prohibited such distribution. Spriggs discovered these pictures after logging into a members-only adult website which sent her enough email spam she just had to check it out. Whilst cruising the racy adult website she also discovered pictures of her ex’s new girlfriend.

Authored By: Phil G. Ryan

Citation: Holmes v. Petrovich Dev. Co., LLC, 2011 WL 117230 (Cal. Ct. App. Jan. 13, 2011)

Employee/Employer Implicated: Employees

e-Lesson Learned: Communications between an employee and her attorney on a company’s computer, in violation of the company’s computer policy, are discoverable by the employee’s employer because those communications are not communicated in confidence and, are therefore, not privileged.

Tweet This: Inside-Voices Only! If you’re going to talk poorly about your boss do not use the company computer!

They are always watching! Whether you’re emailing your kids, encouraging them to do their homework and chores before watching television, sending a message to this week’s fantasy football rival, rejecting his offer to trade his kicker for your star running back, or reaching out to your college roommates, seeking advice on how to pick up the girl at the local coffee shop, make no mistake, they are watching! When you agree to your company’s computer policy, the one that says you’ll use the employer issued device for work purposes only, you do more than just promise you will spend your time focused on your job. You give up your privacy. Those emails to your kid, the message in your fantasy league, and the note to your friends, are all fair game for your boss to read.

Authored By: Christopher Dize

Citation: In re Grand Jury Subpoenas, 2010 U.S. App. LEXIS 24893 (9th Cir. Cal. Dec. 7, 2010).

Employee/Employer Implicated: Law Firms, Companies engaged in price fixing and other antitrust violations

e-Lesson Learned: Don’t engage in illegal price fixing . . . but if you do, don’t import the evidence into the United States, too!

Tweet This: Don’t engage in illegal price fixing . . . but if you do, don’t import the evidence into the United States, too! http://ellblog.com/?p=2256

For foreign companies doing business in the United States, avoiding getting sued may be hard enough without having to worry about whether you’re being investigated by a grand jury and the U.S. Department of Justice. However, life can be really difficult for foreign companies that are not only getting sued, but also have to turn over their civil litigation documents for investigations of possible criminal conduct. Under a recent 9th Circuit ruling, this is exactly the kind of misfortune that has befallen several foreign LCD manufacturers. The foreign companies, including LG Display, Sharp, and Chunghwa Picture Tubes, are embroiled in an antitrust class action suit and are simultaneously being investigated for antitrust criminal behavior. Even though it couldn’t find any precedent to support its decision, the court ruled that if the documents were in the country, they were within the “grasp” of the grand jury. The 9th Circuit’s ruling comes as a big victory for the DOJ. It gives prosecutors expanded power to subpoena foreign documents that have entered the country for civil litigation purposes.

Authored By: Eric Abes

Citation: Gates v. Wheeler, 2010 Minn. App. Unpub. LEXIS 1136 (Minn. Ct. App. Nov. 23, 2010)

Employee/Employer Implicated: Owners; IT Administrator

e-Lesson Learned: Do not put anything into your company’s computers that you want to remain private. Do not read your business partners emails.

Tweet This: You may have an expectation of privacy in your emails, but don’t expect your boss to abide by it --> http://ellblog.com/?p=2238

Everyone knows that the iPhone is a superior method of communication. It far surpasses all other computers, smart phones, company email accounts, Morse code, smoke signals and binary code communications. And most importantly, IT CANNOT BE ACCESSED BY YOUR BUSINESS PARTNER. In Gates v. Wheeler, 2010 Minn. App. Unpub. LEXIS 1136 (Minn. Ct. App. Nov. 23, 2010), the respondent may have been vindicated, but the problem was partly of his own making. In Gates, Gates sued his business partner, Wheeler, for equitable relief concerning their jointly held LLC. The two were the sole partners and could not agree on business decisions. As they were deadlocked, Gates sued to have the court remedy the situation. Fairly typical case until Wheeler decided to cheat.

Authored By: Joscelyn

Citation: Stengart v. Loving Care Agency, Inc.

Employee/Employer Implicated: Employees and Employers Alike

e-Lesson Learned: The employee in this case had a reasonable expectation of privacy in personal web-based emails between the employee and her lawyer, sent and received (during work hours) using the employer’s computer and IT systems.

Tweet This: Video eLessons: Privacy wins out in latest Stengart decision --> http://ellblog.com/?p=2059

This is the second video by Joscelyn from the eLessons Learned series on Stengart, dealing with the March 30 New Jersey Supreme Court decision favoring privacy over waiver of attorney-client privilege.

Authored By: Evan Rosenberg

Citation: Preferred Care Partners Holding v. Humana, 2009 WL 982460 (S.D. Fla. April 9, 2009)

Employee/Employer Implicated: Outside Counsel

e-Lesson Learned: Outside counsel should advise all party employees to conduct a thorough search of their computers so that relevant documents will be discovered and produced before the end of the discovery period.

Tweet This: You risk more than making a fool of yourself when you fail to conduct thorough discovery --> http://ellblog.com/?p=1975

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.