Discovering the Inaccesible
By Julie Wade
What exactly are inaccessible sources and when should production from such sources be permitted?
Back-up tapes are the first source that comes to mind. These are considered inaccessible because they often have no
organizational structure, are not indexed in any way, and are difficult to search…. Functionally speaking, then, an
inaccessible source is one where a party would have to acquire or create software to retrieve potentially responsive
information or would otherwise be required to render inaccessible information accessible (e.g. restore/translate), which is
always an expensive proposition….
FAQ’s of E-Discovery by Judge Shira A. Scheindlin, S.D. N.Y.
More and more, we are
starting to see document
requests in Texas state
court litigations calling for the production of electronically stored information, or
“ESI” for short.
Rule 196.4 of the Texas Rules of Civil
Procedure sets forth the procedures for a
party to obtain discovery of data or information
that exists in electronic or magnetic
form. This rule states that the requesting
party must (1) specifically request the production
in electronic form, and (2) specify
the form in which that party wants the ESI
produced. Then, the responding party
must produce ESI responsive to the
request that is reasonably available to that
party in the ordinary course of business.
Should that responding party not produce
any ESI data it deems relevant to the case,
then that party must file an objection with
the court setting forth the basis of its reasons
for not complying with the court’s
rule. After consideration, the court may
order the responding party to comply with
the request. If it does, then the court must
also order that the requesting party pay the
reasonable expenses of any extraordinary
steps required to retrieve and produce the
information. That can be expensive.
So, in a Texas state court litigation,
your client is not obligated to produce ESI
that is deemed to be reasonably inaccessible—
at least initially. This includes deleted
data, legacy data and data on backup storage
tapes. Backup tapes are a cost effective
storage solution and that is the reason they
are widely used. But backup tapes are not
designed to be a records management
solution. They were designed to serve as a
“backup” for your system for disaster purposes.
Unlike computer files that can be
searched individually, all the data on backup
tapes are stored “sequentially,” which
means that you have to reload everything
on a backup tape in order to be able to
separate out the file or files you need to
access. This further complicates and escalates
the costs when retrieving backup
tapes to search for files for discovery purposes.
The best storage method is archiving
as much as possible which allows you
to maintain your search capabilities of the
archived media without having to restore
an entire tape.
Archiving systems are designed for long
term document retention and for the
retrieval of records. Technological
advances with indexing protocols help
facilitate retrievals based on standardized
criteria, and new archiving applications
are incorporating more sophisticated
search capabilities across an archived system.
If an opposing party responds with
inaccessibility objections to your discovery
request for ESI, they must set forth the
reasons their client is unable to produce
the requested material. Then you can
decide whether to set a hearing on their
objections or walk away because of the
costs involved. If the court rules that the
electronic discovery is necessary to the litigation
and orders it to be produced, the
court will also order that the requesting
party pays for the reasonable costs of any
“extraordinary steps” taken to produce the
inaccessible data.
There are very legitimate reasons that
ESI may be too burdensome or costly to
access or produce. Multi-national corporations,
such as Exxon, have huge volumes
of ESI and are able to easily demonstrate
that their email volume is equally gigantic.
Charles Beach of Exxon told the Advisory
Committee contemplating the rules
amendments that at the end of 2006,
Exxon used 800 terabytes of total storage
and 121,000 backup tapes per month. If
they were to stop recycling their backup
tapes for a litigation hold, it would cost
Exxon almost $2 million per month. So,
the inaccessibility rules are important and
are in place for a good reason.
Under the Texas rules, a party seeking
to access any of the information stored on
Exxon’s backup tape rotations would be in
for a rude shock when the court granted
its request, but turned right around and
ordered that they also pay for costs associated
with accessing the data.
Rule 26(b)(2)(B), however, the companion
rule addressing inaccessibility
issues for federal court litigations, is more
balanced in weighing the obligations of the
parties as to their ability to pay for and
produce ESI that is deemed inaccessible.
This rule states that a party is not obligated
to produce ESI from sources it identifies
as not reasonably accessible because of
undue burden or cost. A requesting party
could then file a motion to compel or for
a protective order. The responding party
would need to show the court at that point
why the ESI is inaccessible because of the
undue burden or cost. And the court
could then rule that the ESI should be
produced, considering the limits of Rule
26(b)(2)(C) (discovery cannot be compelled
if it is unreasonably cumulative or
duplicative, or if it is obtainable from
some other source that is more convenient,
less burdensome, or less expensive, or
if the burden or expense of the proposed
discovery outweighs its likely benefit, taking
into account the needs of the case, the
amount in controversy, the parties’
resources, the importance of the issues at
stake in the litigation, and the importance
of the proposed discovery in resolving the
issues). But at the end of the day, federal
judges or magistrates can act on their own
initiatives and do something entirely different.
The seminal case on point in Texas
concerning whether backup tapes should
be produced in response to a discovery
request is found in In re C.I. Host, 92
S.W.3d 514, 516-17 (Tex. 2002) (approving
order requiring production of computer
backup tapes). This case is deceptive however,
because the objection to the discovery
related to privacy issues under the
Stored Communications Act (18 U.S.C. §
2701, et. seq.) and not the inaccessibility
argument that is usually at the center of
discovery disputes involving backup tapes.
So although the court allowed the backup
tapes to be produced, other courts have
found that the cost and burden of producing
such tapes outweighs their likely benefit
taking into consideration: the needs of
the case, the amount of controversy, the
resources of the parties, the importance of
the issues at stake in the litigation and of
the discovery sought to the resolution of
the issues. Thompson v. U.S. Dep’t of Hous.
& Urban Dev., 219 F.R.D. 93, 98 (D. Md.
2003).
But we are in Texas, and if your attorney
really wants Exxon’s backup tapes,
your client may have to pony up, at least
according to the state court rule. If your
lawsuit was in federal court, Exxon would
probably be ordered to pay for the restoration
costs because the reasonableness standard
would be weighed against the parties’
resources. Considering Exxon’s financial
resources, you could fill in the blank on
that.
The federal rule also reaches further
than the Texas rule on the inaccessibility
issue because the federal rule requires that
a responding party identify the sources of
potentially responsive ESI that it has not
searched or produced because of the costs
and burdens of accessing this information.
At this point, a requesting party can move
for an order compelling the production
notwithstanding the inaccessibility arguments,
and the responding party would
then have the burden to show how the ESI
is not reasonably accessible. Once again, if
a responding party makes this showing, a
court could nevertheless order the discovery
when good cause is shown. And, in
federal court, a judge or magistrate can
impose any appropriate terms and conditions
it wants to for the production.
I spoke with Jeff Friedman, a Senior
Product Manager with Anacomp’s CaseLogistix,
on his thoughts on archiving,
backup tapes, inaccessible data and the
corporate responsibility to apply preservation
holds against storage media. Jeff has
15 years of eDiscovery experience as an
attorney, consultant, and product manager
and has worked on some of the most complex
electronic discovery matters that have
arisen across the world during that time.
Jeff agreed that “companies are going to
more comprehensive systems in dealing
with document management and life cycle
management—and are thinking about
these concepts a lot more holistically.”
It is interesting to me that the adopters
of the amendments to the 2006 federal
rules provided us with their initial
thoughts behind including ESI into the
new discovery rule amendments, and that
was the cost effectiveness of producing
ESI. Reading from the Report of the Judicial
Conference Committee on Rules of
Practice and Procedure to the Chief Justice
of the United States and Members of the
Judicial Conference of the United States
dated September 2005, the Committee
states:
“The present electronic discovery
proposals grew out of the advisory
committee’s work on the 2000
amendments, which focused on the
“architecture of discovery rules” to
determine whether changes could
be effected to reduce the costs of
discovery….”
So, the initial intent behind requiring ESI
to be preserved and produced in civil
court litigations was to lower the costs of
the discovery process. This certainly has
not proved to be the case as you find your
clients struggling to manage the massive
amounts of data being created by their
workforces.
Friedman also points out that there is a
new degree of responsibility for the business
owner today that some of these
organizations aren’t yet used to. “They
need to consider, what is my document
management policy? What is my backup
strategy? What is my recovery strategy?
These are things that previously they didn’t
have to think about because either it
was just physically impossible or it was
unnecessary. Now it is both possible and
necessary.”
Businesses must have a plan to manage
their electronic records. That is because
they have a duty to preserve ESI that can
be used as evidence in the event of litigation
or a threatened litigation. This culminates
in real time cost repercussions to
your clients who cope to comply with
their records management obligations and
in managing their IT systems.
“Because what was a small litigation for
smaller companies in terms of documentation
is now exploding, and now discovery
costs are going up as well across the
board,” Friedman said.
You cannot repeat enough that correct
procedures and protocol need to be implemented
in connection with the management
of electronic data. Too many times
parties are disadvantaged during the
course of a litigation because the attorneys
and business executives managing the litigation
did not communicate sufficiently
with the IT staff. For instance, the difference
between backup tapes and archives is
unknown; the failure to halt the routine
overwriting of backup tapes is not attended
to can make a huge difference and lead
spoliation sanctions in the case. It is simply
not good enough any more for your
client to establish a proper retention policy
if you do not actually reach the persons
doing the actual records management of
relevant ESI.
A tech-savvy paralegal and a good
knowledge expert, such as Jeff Friedman,
can reach out to both attorneys and the
client’s IT staff in situations where help is
needed and they are able to “speak the
language” to both groups. Developing a
combination of these skills can really help
facilitate the obvious problems between
legal and IT: legal is driven by instant gratification,
instant goal accomplishment—
whereas IT is budget and project focused
and for keeping things moving along in
those lines. Conflicts will always exist
when legal “wants it now,” and IT always
“wants it later.” That tension exists, so it is
very important to have someone with IT
knowledge and legal experience to work as
a buffer in accomplishing the tasks associated
with electronic discovery.
“What we are finding is that much larger
cases in terms of electronic discovery
are going to much smaller firms, and they
need best practices as well as the methodology
in place to handle it.” Friedman
said.
Litigation Paralegals should surf the
web for “electronic discovery” + webinar,
and get up to speed on these imperative
issues facing our work practices today and
in the future.
Julie Wade is a Paralegal for the law firm of
Harrison, Bettis, Staff, McFarland &
Weems, LLP and is a Certified Electronic
Discovery Specialist.
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