e-Discovery Team Training

Welcome to Module 3-O.

Paper or Plastic? The Wisdom of Supermarket Bag Boys and the Need for Local Rules

This module goes deeper into native file production, one of the most misunderstood issues in e-discovery, and includes Ralph Losey’s “Paper or Plastic” lecture to law students. At the very least a Rule 26(f) conference should discuss the form of production. Should it be a traditional paper production or a modern native production of ESI, a production usually made on VCDs or DVDs, which are plastic. Which is it going to be, paper or plastic? Even supermarket bag boys know that is a good thing to ask before you begin your work. Why don’t lawyers?

I did not attend every Federal Rule 26(f) attorney conference in the country this year. Yet, I am still pretty sure that e-discovery was not discussed in most of them. In the few conferences where e-discovery was mentioned, it was probably not discussed in depth, despite the fact that the 2006 Rule 26 Commentary added ESI to the list of subjects to be discussed. How do I know this? I speak with lawyers from all over the country, real everyday litigators, not just the small group of e-discovery specialists who practice the same kind of law that I do.

I meet these pre-digital or proto-digital lawyers all of the time. I have known some of them all of my life; some are family. Occasionally, other litigators I meet for the first time will ask what type of law I practice. When I tell them I practice e-discovery law, it is obvious that they have little idea of what it is that I really do on a day-to-day basis. If I were to go into the technical details with them, they would be totally lost and likely bored.

I might have the same response to an immigration or zoning lawyer’s technical descriptions of what they do. I have never practiced in these areas of law and have little interest in them. Litigators have the same kind of response to my practice area for the same reason: they have never personally done e-discovery (hiring a vendor does not count) and they have no real interest in the field. However, immigration or zoning law have nothing to do with my practice and I need no skill in these areas to do my job.

There is no getting around the fact that many litigators have no real interest in e-discovery. They smile when you explain that you not only specialize in discovery, but in one small kind of discovery, the “e” kind. They usually respond with an empty remark of false enthusiasm, like “Gee, that must be interesting. How cutting edge.” It is obvious what they are secretly thinking. This part of discovery, the electronic computer geek stuff, is such a small part of discovery for them as to be barely existent. Yet a lawyer purports to specialize and limit their practice to it? The strange life of big firm lawyers.

Most Lawyers Do Not Discuss e-Discovery at Rule 26(f) Conferences

Everyone knows that lawyers are not discussing e-discovery at Rule 26(f) conferences, or if they are, it is just done in a cursory fashion. Why are we not talking about this? I will confess that I once participated in a Rule 26(f) conference where the sum total of our ESI discussion took only four words, count them:

Defendant’s counsel: Paper or plastic?Plaintiff’s counsel: Paper!

Both sides then chuckled and moved on to more important things, like who would take the first deposition and where. The litigators here both knew what they meant by this shorthand conversation. Paper meant business as usual, a search for and production of paper documents. Plastic meant e-discovery, where you waste a ton of money paying vendors to chase down unimportant ESI and pay young lawyers to read emails about what people had for lunch, which are then produced to each other on plastic CDs.
A deficient discussion you may say, but I contend it is compliant and perhaps even smart for one party or another in certain cases. For instance, the defense counsel in the above real-world conference left with a stipulation for production in paper format. Moreover, he then knew that he was up against a plaintiff’s counsel who would not be asking for ESI. This was then put in a Rule 16(b) report, dressed up with something like “the parties agree that no electronic discovery is needed or required in this case and all responsive documents located shall be produced in paper format.” Both attorneys were then protected and relieved of e-discovery. Yes, that is how most litigators still think about it. Certainly the plaintiff’s lawyer did in this example, whereas the defense lawyer, me, was relieved for yet another reason. I will let you imagine why.

I contend that the vast majority of attorneys in federal practice today fail to have a meaningful discussion of e-discovery at Rule 26(f) conferences. Most do not even go so far as the supermarket bag boy question, or if they do, they pick their old friend paper. It is either no discussion at all, or a cursory “paper or plastic” mention. (Lest you think I am picking on federal practitioners here, the practice in states courts is even worse.)

The Federal Rules are Vague Enough to Allow this Practice

Does this mean that the Bar is in contemptuous disregard of the rules? Is this a secret rebellion of the pre and protodigitals? Is there a conspiracy among attorneys, officers of the court, to disobey the very rules that they have sworn to uphold?

No. I am not willing to go quite that far yet. It is merely another example of creative rule interpretation coupled with over-tolerant judicial acquiescence. Here is what revised Rule 26(f) actually states:

[T]he parties must … confer … to develop a proposed discovery plan that indicates the parties’ views and proposals concerning: …

(3) any issues relating to disclosure or discovery of electronically stored information, including the form or forms in which it should be produced;

So, that means if the parties do not have any views or proposals on ESI issues, then they have nothing to discuss. End of story. No rebellion, just a reasonable straight forward interpretation of the letter of the law. Alternatively, the attorneys may well have views to discuss, their view may be that e-discovery is a bad idea and they propose to ignore it for now, and just hope that the case settles before they have to hire vendors to do e-discovery for them. This is how a rule is interpreted into a meaningless provision.

There is plenty of precedent for such minor interpretative rebellions by the bench and bar to rules they do not like. You have only to think of Rule 26(g), which both lawyers and judges have ignored for years. See Mancia v. Mayflower Textile Services. Co., 253 F.R.D. 354 (D.Md. Oct. 15, 2008), where Judge Grimm notes that courts are required to impose penalties for boilerplate discovery requests and form responses. But, as we all know, they never do. In fact, Judge Grimm in Mancia calls Rule 26(g) the least understood and most frequently violated discovery rule of them all. That may be, but if so Rule 26(f) is a close second and gaining fast.

How To Force Attorneys To Talk About ESI at Rule 26(f) Conferences

How can this evasion of the ESI discussion requirement in Rule 26(f) be stopped? One answer is attorney education, which I have talked about here on many occasions. Another is to use local rules to require attorneys to include ESI discovery plans in the Case Management Reports of their 26(f) conferences. In my conclusion I provide a specific suggestion for use in a mandatory form CMR.

Local practice should also require magistrates to carefully review the CMRs for adequacy at Rule 16(b) hearings. The program will not work, especially at first, without an active, involved judiciary. Most judges today do not require an e-discovery plan or an alternative stipulation of no e-discovery. The parties can and do often leave it vague and no judge calls them on it. Often attorneys leave it vague on purpose, and do not forego e-discovery entirely, just in case they do not settle and have to hire an e-discovery vendor near the end of the case to do e-discovery for them. If lawyers in a case want to ignore e-discovery today, most judges are still ok with that. This also complies with the letter of Rule 16(b) as written, which merely says:

The scheduling order may also include: … (5) provisions for disclosure or discovery of electronically stored information;

The operative word here is “may,” not shall. Despite the much heralded rule changes of 2006, lawyers can and do avoid e-discovery if they do want to. They are free to ignore most of the information their clients possess concerning a dispute, if they want to.

Problems with the Current Prevailing Strategy of Avoidance

There are, of course, multiple problems with this prevailing strategy, if want to call it that. Number one, it ignores most of the evidence needed for the just, fair, and speedy resolution of a dispute. It is thus a disservice to the American system of justice. The disservice is primarily to the parties, to the clients that the litigators supposedly represent. The ethical mandates of competency and diligence are also ignored by such a strategy. Even though this may be a common practice, it may still be unethical. Further, although the strategy of avoidance may comply with the letter of the rules as currently interpreted, it still clearly violates the spirit and intent of the 2006 Rule revisions. A quick read of the official Rule Commentaries makes that obvious.

Another problem with the ostrich strategy is that lawyers often change their minds half way into the case. They are sometimes forced to pull their head out of the sand, or wherever it is, and start asking for emails and the like. This is, of course, just what the 2006 rule changes were designed to try to avoid and thus the source of much irritation by the poor judges called up to referee such change-of-heart games.

Don’t Ask, Don’t Tell

To summarize, I contend that most attorneys do not adequately discuss e-discovery at Rule 26(f) conferences. Most do not even ask the most rudimentary paper or plastic questions. I also contend that this practice of avoidance complies with the rules as written and interpreted by most litigators and tolerated by most judges. You could question and argue against this interpretation, but few do, and most judges go along with it. The presiding judges let this game go on every day in the vast majority of federal cases now pending in this country. They approve by their silent acquiescence. Not all do, of course, a few e-discovery oriented judges speak out, and speak loudly, but they are a small minority. Most judges just look the other way. We need to change this by more enlightened attitudes in the bench and bar, by education, and also by local rules that can force some kind of discussion.

Until these changes are made we will continue to see cases where there are stupid, unnecessary disputes over form of production, paper or plastic, simply because the lawyers did not have the wisdom of grocery store bag boys. They all know to ask a customer which form they want before they bag the groceries, not after. They know not to just assume the customer wants paper simply because that may be easier for them to pack. They know that if they do not ask, they may well have to do it all over again. So they ask the now annoying question, paper or plastic, and they keep bugging you until they get an answer. How long will it take for lawyers all over the world to learn to do the same?

Ford Motor Co. v. Edgewood Properties, Inc.

In Ford Motor Co. v. Edgewood Properties, Inc., 257 F.R.D. 418 (D.N.J. May 19, 2009), Judge Esther Salas was faced with situation similar to Judge Facciola’s Convad case and archaic request for production that we discussed before. Yes, this is a paper or plastic case, but, unlike in Convad, here the requesting party did specifically ask for plastic. They requested production of ESI in the original native form with full metadata. The responding party replied by saying no, they would produce in modified paper, here TIFF image files with some metadata. Id. at 424. Judge Salas called this “dueling declarations” where no agreement was reached, but then the responding party “unilaterally adopted its own objection and produced them in TIFF format.” Id. The requesting party then stood silent after the TIFF production began. Only later, after all production was complete, did they file an objection and ask the court to intervene and require a reproduction of the same documents in native form.

It is as if the grocery store customer said plastic, the bag boy then said no, but I will pack in paper, and then went ahead and packed all of the groceries in paper just like he said he would. The customer watched and waited and did not complain until after all of the groceries had been bagged, and then the customer complained and said no, take them all out and repack them in plastic bags.
In this situation Judge Salas followed common sense and held that the requesting party had waited too long and had waived the objection. The requesting party should have complained as soon as the first paper production was made. They said the words paper and plastic at each other, but they did not really discuss it, much less reach an agreement. If they had, and if the agreement had been included in a court approved Rule 16(b) order, then this dispute would not have happened.

Aguilar v. Immigration and Customs Enforcement Div. of U.S. Dept. of Homeland Sec.

The same situation is considered by Judge Frank Maas in Aguilar v. Immigration and Customs Enforcement Div. of U.S. Dept. of Homeland Sec., 255 F.R.D. 350 (S.D.N.Y. Nov. 21, 2008). Aguiar is well known for its phrase that metadata has become “the new black” and contains a good discussion on when and how metadata should be requested. Id. at 359. Of course, a native (plastic) production has metadata, whereas a paper version does not. Once again, the attorneys in Aguilar did not reach any agreement on production form at the beginning of the case; they did not even discuss it. They did their clients a disservice via silence as Judge Mass noted:

This lawsuit demonstrates why it is so important that parties fully discuss their ESI early in the evolution of a case. Had that been done, the Defendants might not have opposed the Plaintiffs’ requests for certain metadata. Moreover, the parties might have been able to work out many, if not all, of their differences without court involvement or additional expense, thereby furthering the “just, speedy, and inexpensive determination” of this case. See Fed.R.Civ.P. 1. Instead, these proceedings have now been bogged down in expensive and time-consuming litigation of electronic discovery issues only tangentially related to the underlying merits of the Plaintiffs’ Bivens claims. Hopefully, as counsel in future cases become more knowledgeable about ESI issues, the frequency of such skirmishes will diminish. Id. at 364.

In re Netbank, Inc. Securities Litigation

A case out of Atlanta covers a new twist to the paper or plastic issue. In re Netbank, Inc. Securities Litigation, 2009 WL 2461036 (N.D.Ga. Aug. 7, 2009). District Court Judge Beverly B. Martin considered a motion by the plaintiff to compel the defendants to produce all ESI is native format. The defendants basically responded by saying that even though the plaintiff asked for plastic, they did not want to do what he asked, and the judge should not make them because the rules did not require it. Instead, the defendants refused to produce ESI in anything other than TIFF format. That is quite retro of them in my opinion; apparently Judge Martin agrees, because she granted plaintiff’s motion and compelled native production.

This dispute as to form of production did not come at the commencement of this case as the rules contemplate. We have no way of knowing for sure from this opinion whether it was discussed or not in the Rule 26(f) “meet and greet.” But it probably was not, or the issue would have been flushed out in the magistrate judge’s 16(b) order or have been the subject of an earlier motion. Most of this lengthy opinion by Judge Martin concerns her certification of the class, which is usually a serious blow to the defendants, and comes many months after the commencement of the action.

The plaintiff wanted native ESI so they could use the metadata, including the date and author, and other obviously important metadata functions that anyone would want in any case, including knowing what attachments go with what email, and being able to electronically search the documents. The defendants not only wanted to produce a flat electronic file, but also a dead one at that, with all searchabilty removed. In a case in Orlando a dead TIFF maneuver just like that resulted in sanctions against the producing party, their attorneys, and their attorneys law firm. Bray & Gillespie Mgmt. LLC v. Lexington Ins. Co., 2009 WL 546429 (M.D. Fla. Mar. 4, 2009) (more on this case in a later class).

I am wary of the dead TIFF approach to paper production of ESI. In my view it is more efficient to produce most ESI in native form and defendants opposition here was misguided. So to be fair, rather than my paraphrasing defendants arguments, I will quote Judge Martin:

The Defendants argue that they are not required to produce ESI in any particular format, so long as it is reasonably usable. They state that producing documents in native format “allows the alteration of documents produced and creates difficulties in authenticating and tracking documents produced.” (Defs.’ Opp’n to Pl.’s Mot. to Compel 14-15.) The Defendants further state that using native format makes it impossible to “Bates label individual pages of a document,” and state that “[a]nother potential drawback with native format production is that one or more of the parties may lack access to the software program or application required to read the native file.” In re Netbank, supra at *21.

It is odd that the defendants, represented by dozens of attorneys, many from prominent law firms, would actually argue that they should not have to produce in native format because the files could be easily altered. Could it be that none of these attorneys have heard of hash? See Losey, R., HASH: The New Bates Stamp, 12 Journal of Technology Law & Policy 1 (June 2007). Then they further argue against native production by complaining that it will be hard for them to reimpose archaic Bates stamping invented in 1890. Talk about retro!

Judge Martin was not too impressed with defendants’ arguments either. Frankly, defendants’ arguments conjured an image in my mind of a belligerent bag boy who refuses to use plastic bags just because he doesn’t want to. He only likes paper and he claims that plastic bags don’t hold up, hurt your hands to carry, don’t biodegrade, can’t be Bates stamped, etc. Here is Judge Martin’s rejection of their arguments:

*22 Federal Rule of Civil Procedure 34 states that a party requesting production of electronically stored information “may specify the form or forms in which electronically stored information is to be produced.” Fed.R.Civ.P. 34(b)(1)(C). The Advisory Committee Notes to Rule 34 contemplate that “[t]he responding party also is involved in determining the form of production.” Fed.R.Civ.P. 34 advisory committee’s note, 2006 Amendment, subdivision (b). In the instance that the two sides are in disagreement about the form, and they have met to confer pursuant to Rule 37(a)(2)(B), the requesting party may file a motion to compel, in which case “the court resolves the dispute[.] [T]he court is not limited to the forms initially chosen by the requesting party, stated by the respond-ing party, or specified in this rule for situations in which there is no court order or party agreement.” Id.

Although the Defendants have listed a number of hypothetical problems with providing documents in native format, they have not asserted these to be actual problems arising in the present case. For example, the court does not understand the Defendants to be asserting that Mr. Brown or his attorneys will alter the documents they produce. Likewise, neither of the parties in fact lacks access to the software required to read native files. Furthermore, the court is confident that the precision of record citations can be appropriately dealt with should Mr. Brown desire to use any of the documents at issue as exhibits or evidence. In contrast, Mr. Brown has definitively stated that the provision of TIFF documents has made “review and analysis much more difficult and expensive,” and likewise “conceals (by omission) any metadata FN24 known to the Defendants.” (Mem. of Law in Supp. of Pl.’s Mot. to Compel 16.) The Defendants having given no good reason why they should not produce Mr. Brown’s requested documents in native format, the Motion to Compel production of ESI information in native format is granted. Id. at *22.

Valeo Electrical Systems, Inc. v. Cleveland Die & Mfg. Co.

I could go on and on with examples of parties not talking to each other and then wasting the court’s time and their client’s money over silly disputes concerning paper or plastic, or my second favorite waste of time, dueling lists of search terms. But I will restrain myself and just focus on a case out of Michigan. Valeo Electrical Systems, Inc. v. Cleveland Die & Mfg. Co., 2009 WL 1803216 (E.D.Mich. June 17, 2009). This case is unlike all of the others because the attorneys here did have some discussion about ESI, but as you will see, not enough. Apparently defense counsel did not understand the potential impact of the deal he made at the 26(f) conference for the parties to produce ESI in “searchable PDF format that is readable in the Adobe Acrobat system.” Id. at *1.

The big mistake of the parties here was their failure to agree to native production. Instead, they agreed to produce in quasi-paper, namely searchable PDF files, and they did not also agree to full load files and other metadata exchange profiles. These searchable, but other wise dead (metadata stripped) PDF image files of ESI are grossly inferior to the original full live native files. They are inferior, and the agreement was ill founded, because most of the metadata is lost in a PDF version of ESI, even a searchable PDF version. Gone in this agreed format are most of the important metadata of these documents and email, including the metadata which tells you the email attachment correlations, and, the way the plaintiff did it here, even the original file names.

Defense counsel obviously did not understand what he had agreed to because when all he received as a production were plastic CDs full of unnamed PDF files, 270,000 pages worth, he complained like hell and moved to compel a proper response. He was the victim of a near hopeless document dump, not made much better by the fact that it was indexed for search. Search is so limited without full metadata. It will not tell you the original file names, the authors, the dates, or even whether they were sent by email to someone or not. It is nearly as stupid as paper itself.

After the defendant’s attorney filed his motion, plaintiff’s counsel attempted to put a happy face on this for the judge’s sake by providing spreadsheets with the original names and some other information and indices about the 270,000 pages of PDFs produced. The attorneys for the defendant did not find these spreadsheet lists particularly helpful, and the presiding Magistrate Judge Steven D. Pepe was inclined to agree saying:

These two indices may be the nearest thing approaching a “magic decoder ring” and defense counsel may consider it of no more help than the Rosetta Stone leaving him and his associates hours of work ahead to comb through what was previously undecipherable hieroglyphics on the 15 discs. Id. at *3.

In spite of this serious problem, Judge Pepe denied defendant’s motion, pointing out that they received what they had asked for and agreed to in their Rule 26(f) conference. The moral of this story is obvious. Do not agree to what you do not understand. Get an expert to help. If you do not, the bag could well break and you could end up with serious egg on your face and a mystical decoder ring on your hand.

Conclusion

Cases like these confirm my anecdotal research that most attorneys are not discussing ESI at 26(f) conferences. When they do discuss ESI, the discussion is very short, perhaps not as short as my shameful four word record, but inadequate nonetheless. I am not saying that all attorneys in federal practice are refusing to follow the recommendations of the Rule Commentaries. Some attorneys are doing it right and doing it very well. They are saving their clients money in the process by avoiding unnecessary disputes, or confronting necessary disputes head-on at the beginning of the case and getting them resolved quickly. This protects their clients. There are a significant and growing number of attorneys who are doing it right. What I am saying is that these rule compliant attorneys are the small minority.

I am also saying that the attorneys who do not engage in meaningful discussions about electronic discovery in Rule 26(f) conferences are not really violating the rule, as I have shown above, but they are interpreting and applying it into oblivion. That is not good. We should do something about it.

We should raise the level of understanding and educate the silent majority of litigators on why and how to talk. We should also ask our judges to promulgate local rules that encourage, even force compliance. Right now it is way too easy to avoid e-discovery discussions and get away with it. Although a few judges complain, like Judge Facciola, most do not; they just wink at the non-compliance.

One local rule that might help is to require attorneys to file a standard form case management report that specifically addresses each of the issues suggested in the Comments. Here is an example that I created with the help of Bill Hamilton and others:

The parties have discussed issues relating to disclosure or discovery of electronically stored information (“ESI”) and agree that (check one):

__ no party anticipates the disclosure or discovery of ESI in this case;

__ one or more of the parties anticipate the disclosure or discovery of ESI in this case.

If disclosure or discovery of ESI is sought by any party from another party, then the following issues shall be discussed.

A. The form or forms in which ESI should be produced.

B. Nature and extent of the contemplated ESI disclosure and discovery, including specification of the topics for such discovery and the time period for which discovery will be sought.

C. Whether the production of metadata is sought for any type of ESI, and if so, what types of metadata.

D. The various sources of ESI within a party’s control that should be searched for ESI, and whether either party has relevant ESI that it contends is not reasonably accessible under Rule 26(b)(2)(B), and if so, the estimated burden or costs of retrieving and reviewing that information.

E. The characteristics of the party’s information systems that may contain relevant ESI, including, where appropriate, the identity of individuals with special knowledge of a party’s computer systems.

F. Any issues relating to preservation of discoverable ESI.

G. Assertions of privilege or of protection as trial-preparation materials, including whether the parties can facilitate discovery by agreeing on procedures and, if appropriate, an Order under Federal Rules of Evidence Rule 502. If the parties agree that a protective order is needed, they shall attach a copy of the proposed order to the Case Management Report. The parties should attempt to agree on protocols that minimize the risk of waiver.

H. Whether the discovery of ESI should be conducted in phases, limited, or focused upon particular issues.

Please state if there are any areas of disagreement on these issues and, if so, summarize the parties positions on each: __________________________________________________

This kind of checklist for mandatory discussion and agreement could force attorneys to figure out what they want to do. It could flush out the inevitable disagreements and bring them to the magistrates for resolution at the beginning of the case, the 16(b) hearing, rather than the end. This kind of proposal can work, but only if judges get behind it, promulgate the rules, hold 16(b) hearings in each case, and closely question attorneys during these hearings about their e-discovery plans, including the paper or plastic question. With a lot of work, and a little luck, the paper or plastic mantra will become as popular and oft heard in the courthouse as it is the supermarket.

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PAPER OR PLASTIC?

Professor Losey’s U.F. Law Class Lecture Excerpt on the Importance of Metadata

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SUPPLEMENTAL READING: Find a case dealing with a Rule 26(f) conference and e-discovery. There are many of them out there. How would you handle a Rule 26(f) conference. Do you think it would be better to discuss e-discovery issues in a series of conferences, not just one? Think back to Ralph’s animated video in the introduction to this program, where the young lawyer sets up the clueless plaintiff’s attorney at the meet and greet. Watch it again now that you are three-fourths of the way through the program. Watch what he is doing. Are you ready to be that attorney?

EXERCISE: Check out some of the many other YouTube videos by Losey. Which one is your favorite and why? Yeah, you can write him about that one (ralph.losey@gmail.com).

Students are invited to leave a public comment below. Insights that might help other students are especially welcome. Let’s collaborate!

Copyright Ralph Losey 2015