Vol. 83, No. 7, July 2010
by Richard J. Sankovitz, Jay E. Grenig & William C. Gleisner III
“Lawyers and judges must become better educated about electronic information and [the] discovery thereof. … [P]arties must meet, confer, and seek to identify [electronically stored information] …, what information is and is not accessible, and the scope of each party’s rights and responsibilities. … [D]iscovery (production) requests should be as clear as possible about the data being requested. … [T]rial courts may need to be more active in managing electronic discovery and production than in managing conventional discovery or production of information, especially when parties cannot agree about the scope of electronic information.”1
Long before this article’s authors helped prepare Wisconsin’s new electronic discovery (e-discovery) rules2 as members of the Evidence and Civil Procedure Committee of the Wisconsin Judicial Council, courts and commentators throughout the United States struggled to come to terms with the phenomena of e-discovery. The existing rules of civil procedure and evidence, which had worked so well for many decades for paper evidence, seemed inadequate or completely irrelevant when applied to information existing primarily or only as bits and bytes somewhere in a computer system. In the summer of 2004, when Wisconsin Supreme Court Chief Justice Shirley Abrahamson wrote the words at the beginning of this article, Wisconsin was one of many jurisdictions without any legal rules and procedures specifically addressing the burgeoning digital revolution.
Chief Justice Abrahamson’s concerns are now being addressed. On April 23, 2009, the Judicial Council petitioned the Wisconsin Supreme Court to amend Wisconsin’s civil procedure rules to more specifically guide courts and attorneys in managing e-discovery. The supreme court held a public hearing on that petition on Jan. 15, 2010, and several individuals testified. The supreme court asked that the Judicial Council refine the proposed new rules, and the Judicial Council submitted an amended petition to the court on March 19, 2010. On April 28, 2010, the supreme court, in a 4-3 vote, approved the amended petition. The new e-discovery rules will become effective on Jan. 1, 2011. At its April 28, 2010, conference the court voted to adopt an alternative to section 804.01(4m) (governing “meet and confers”), which is discussed later in this article.
This article addresses four topics:
- a brief history of court rules governing electronic discovery;
- the Judicial Council’s proposal that Wisconsin adopt some but not all of the federal rules governing electronic discovery;
- the new rule changes, including:
- definitional rules, putting electronically stored information on the same footing as conventional documents;
- rules governing the protocol for preserving and producing documents; and
- a rule creating a “safe harbor” for failing to preserve electronically stored information that is lost solely as a result of routine computer operations; and
- the impact of the new rules on lawyers’ discovery duties.
Lawyers Should Review the New Rules before September 2010
The new e-discovery rules do not become effective until Jan. 1, 2011. However, the supreme court will revisit the meet-and-confer provisions in new section 804.01(4m) in September 2010. Judges and attorneys should carefully study the new rules and reflect on how they might affect Wisconsin practice. Attorneys should make their concerns known by letter to the chief justice before the supreme court reconsiders the issue covered by section 804.01(4m).
Richard J. Sankovitz, Harvard 1983, is a Milwaukee County circuit court judge and teaches in the field of electronic discovery. He seeks to reassure judges and lawyers that they need not be specialists or technicians to master these new tools. His teaching presentation is entitled “Electronic Discovery: New Wine in Old Bottles.”
Jay E. Grenig, California-Hastings 1971, is a professor of law at Marquette University Law School. He is a member of the Wisconsin Judicial Council and reporter for the Local Rules Committee of the U.S. District Court for the Eastern District of Wisconsin. He is coauthor of eDiscovery & Digital Evidence, Electronic Discovery and Records Management Guide and Wisconsin Practice Series: Civil Discovery and former managing editor of Electronic Discovery and Records Management Quarterly.
William C. Gleisner III, Marquette 1974, has an extensive background in state and federal litigation and focuses on the technical and legal aspects of obtaining, organizing, and managing electronic evidence. He has provided computerized litigation support and “of counsel” assistance to law firms nationwide, helping them to plan, formulate, and execute e-discovery strategy. With Prof. Grenig, he is coauthor of eDiscovery & Digital Evidence and was a Summation certified software trainer for nearly 10 years.
Brief History of Rules Regulating E-Discovery
For more than two decades – ever since people, businesses, and organizations routinely began storing information on computers and not just in file cabinets – lawyers and judges have struggled with how to apply the normal rules and protocols of document discovery to information maintained in electronic form.
There were no specialized rules in the beginning. Judges formulated solutions on a case-by-case basis by applying existing rules. Analogies were drawn between the paper documents, to which the rules obviously applied, and digital documents.3 Given the many differences between the two types of documents, however, the analogies were strained and the resulting rules were awkward.
Gradually, federal courts began to devise district-wide local rules to address the unusual characteristics of digital evidence.4 At the same time, think tanks began to conduct research and publish findings on how best to deal with digital evidence; an example is the Sedona Conference’s Best Practices, Recommendations and Principles for Addressing Electronic Document Production.5 In August 2004, the American Bar Association added e-discovery to its Civil Discovery Standards.6
Meanwhile, the Judicial Conference of the United States, which is charged with oversight of and improvements to the federal rules of civil procedure and evidence, was studying a nationwide solution for e-discovery in federal litigation. Over the course of about five years, the Judicial Conference developed amendments to the federal rules of civil procedure. The amendments, which took effect on Dec. 1, 2006, modified Rules 16, 26, 33, 34, 37, and 45.7
In October 2007, the Uniform Rules on the Discovery of Electronically Stored Information also were adopted by the National Conference of Commissioners on Uniform State Laws.8 Soon, state court systems began to adopt e-discovery rules that matched or at least paralleled the federal model. Twenty-five states, including California, Illinois, Indiana, Minnesota, New York, Ohio, and Texas, have adopted such rules.9
Wisconsin Appellate Courts Have Not Yet Confronted E-Discovery Issues
Wisconsin’s appellate courts have not yet been presented with a case requiring an assiduous analysis of e-discovery issues.10
Two cases hint at the challenges that e-discovery present. One, Custodian of Records v. State,11 occasioned a strongly worded concurrence by Chief Justice Abrahamson (from which the opening quote of this article was taken) urging reform of Wisconsin’s discovery rules to confront e-discovery.12 The other, WIREdata Inc. v. Village of Sussex,13 was an open-records case involving electronically stored real-estate-tax-assessment data. The decision presents a sophisticated discussion of the mechanics of storing, retrieving, and reviewing electronically stored information and cautions that confidential data not subject to disclosure may be viewed, copied, or destroyed if parties are given unlimited access to electronically stored information.
In neither case, however, did the supreme court prescribe any rule or protocol governing e-discovery in Wisconsin courts.
Want to know more? State Bar Resources
The following Webinar and OnDemand seminars delivered by PINNACLETM (formerly the State Bar of Wisconsin’s CLE Department) provide information you need to effectively deal with electronic discovery to protect and advise your clients, to effectively request and protect electronically stored information, and to avoid malpractice. Full seminar descriptions and registration information is available at www.wisbar.org/cle:
Don’t forget to visit Practice411™ Advice Alert for tips and tricks and links to resources on issues related to electronic documents and e-discovery. Check back often for new content.
The Genesis of Wisconsin’s New E-Discovery Rules
In 2008, the Judicial Council believed the time had come to modify the Wisconsin Rules of Civil Procedure; e-discovery is a growing reality, and virtually all businesses, governmental agencies, and individuals in Wisconsin regularly store discoverable information electronically rather than in hard-copy documents. Recent studies suggest that more than 90 percent of all information created today is stored electronically.14
The Judicial Council’s Evidence and Civil Procedure Committee, chaired by the Hon. Edward E. Leineweber,15 began to study whether Wisconsin should adopt some or all of the 2006 amendments to the federal rules and the Uniform Rules on the Discovery of Electronically Stored Information. The committee sought comments from interested persons throughout Wisconsin.
The Judicial Council considered whether to adopt wholesale the 2006 amendments to the federal rules of civil procedure, as have some other jurisdictions. But ultimately the council determined that a more conservative approach was better, for two principal reasons. First, several of the federal rules that were amended have no analog in Wisconsin. For example, Federal Rule of Civil Procedure 26(a)(1) mandates disclosure, even absent a discovery request, of certain information, for instance a description of all documents a party might use to support its claims or defenses.16 The 2006 amendment to Rule 26(a)(1) specifies that this disclosure applies to electronically stored information as well. Wisconsin’s civil procedure code, however, makes no provision for mandatory disclosure. Therefore, a parallel amendment concerning electronically stored information was deemed unnecessary.
Second, the Judicial Council believed that at least one of the federal amendments would be better addressed by substantive Wisconsin law than by a procedural rule change. The 2006 amendment to Federal Rule of Civil Procedure 26(b)(5) confers a presumptive privilege on a party to retrieve attorney-client communications or work-product materials that have been inadvertently disclosed. This procedure, known in the legal profession as a “claw back,” was widely adhered to even before the federal amendments but remains somewhat controversial. The council believed that whether a party has waived a privilege or the assertion of the work-product doctrine is more properly addressed under the rules of evidence than under the discovery rules.
The New Rules and How They Work
1) New Wis. Stat. § 802.10(3)(jm): Court management of electronic discovery; appointment of referees with special expertise. New Wis. Stat. section 802.10(3)(jm) adds the following to the list of issues a circuit court may address in issuing a scheduling order: “The need for discovery of electronically stored information.” The Judicial Council noted in its petition that this amendment was warranted to “to encourage courts to be more active in managing electronic discovery.”
In discharging this duty, courts may turn to outside experts for assistance. The Judicial Council also noted in its petition that “[p]ursuant to Wis. Stat. § 805.06, the court may also appoint a referee to report on complex and/or expensive discovery issues, including those involving electronically stored information.”
While not widely used in current practice, Wis. Stat. section 805.06 permits a court to appoint a referee:
“A court in which an action is pending may appoint a referee who shall have such qualifications as the court deems appropriate. The fees to be allowed to a referee shall be fixed by the court and shall be charged upon such of the parties … as the court may direct.”
In federal courts, e-discovery issues often are referred to special masters (the federal equivalent of a section 805.06 referee). The Hon. Shira Scheindlin, who sits on the U.S. District Court for the Southern District of New York and is one of the federal judges who has been on the cutting edge of e-discovery,17 recently coauthored an article18 focusing on the importance of using referees, also known as special masters, when dealing with complex or difficult issues involving e-discovery. According to Judge Scheindlin, generalist judges are not and cannot be experts on electronic hardware and software. She suggests that, to manage discovery in cases involving a substantial amount of electronically stored information, and assuming the stakes at risk warrant the cost, special masters with specialized knowledge may become more the rule than the exception.19
The Judicial Council’s Note to new Wis. Stat. section 802.10(3)(jm) suggests that courts should be more active in managing e-discovery. For the new e-discovery rules to work, the circuit courts must be given tools enabling them to discharge this mandate efficiently and effectively.
Wis. Stat. section 805.06 gives Wisconsin such a tool. Section 805.06(2) specifies the following:
“A reference shall be the exception and not the rule. In actions to be tried by a jury, a reference shall be made only when the issues are complicated; in actions to be tried without a jury, save in matters of account and of difficult computation of damages, a reference shall be made only upon a showing that some exceptional condition requires it.”
The provision in section 805.06(2) that a “reference shall be the exception and not the rule” acknowledges use of a special master can add greatly to the cost of civil litigation, and as Judge Scheindlin recognizes, special masters are not needed in every case or even the majority of cases. Nonetheless, some cases will benefit from the appointment of a special master. In those cases, it should be relatively easy to show the necessary exceptional circumstances.
It is not just the judiciary that must learn to adapt to e-discovery. When confronted with technical issues involving electronically stored information, attorneys should retain forensic computer experts who can assist with making or responding to e-discovery requests in a timely and appropriate manner.20
How to Formulate and Respond to E-Discovery Requests
The Judicial Council Note to new section 804.09 is derived from the federal advisory commentary and adopts the significantly broad concept of what constitutes a “document” for purposes of e-discovery and how a discovery request and response may be handled.
The Judicial Council Note to section 804.09 provides as follows:
“Sections 804.09 (1) and (2) are modeled on F.R.C.P. 34(a) and (b). Portions of the Committee Note of the federal Advisory Committee on Civil Rules are pertinent to the scope and purpose of sections 804.09(1) and (2):
“Rule 34(a) is amended to confirm that discovery of electronically stored information stands on equal footing with discovery of paper documents. The change clarifies that Rule 34 applies to information that is fixed in a tangible form and to information that is stored in a medium from which it can be retrieved and examined…. [A] Rule 34 request for production of ‘documents’ should be understood to encompass, and the response should include, electronically stored information unless discovery in the action has clearly distinguished between electronically stored information and ‘documents.’
“Discoverable information often exists in both paper and electronic form, and the same or similar information might exist in both. The items listed in Rule 34(a) show different ways in which information may be recorded or stored. Images, for example, might be hard-copy documents or electronically stored information. The wide variety of computer systems currently in use, and the rapidity of technological change, counsel against a limiting or precise definition of electronically stored information. Rule 34(a)(1) is expansive and includes any type of information that is stored electronically. A common example often sought in discovery is electronic communications, such as e-mail. The rule covers – either as documents or as electronically stored information – information ‘stored in any medium,’ to encompass future developments in computer technology. Rule 34(a)(1) is intended to be broad enough to cover all current types of computer-based information, and flexible enough to encompass future changes and developments.
“References elsewhere in the rules to ‘electronically stored information’ should be understood to invoke this expansive approach. …
“Rule 34(b) provides that a party must produce documents as they are kept in the usual course of business or must organize and label them to correspond with the categories in the discovery request. The production of electronically stored information should be subject to comparable requirements to protect against deliberate or inadvertent production in ways that raise unnecessary obstacles for the requesting party. Rule 34(b) is amended to ensure similar protection for electronically stored information.
“The amendment to Rule 34(b) permits the requesting party to designate the form or forms in which it wants electronically stored information produced. The form of production is more important to the exchange of electronically stored information than of hard-copy materials, although a party might specify hard copy as the requested form. Specification of the desired form or forms may facilitate the orderly, efficient, and cost-effective discovery of electronically stored information. The rule recognizes that different forms of production may be appropriate for different types of electronically stored information. Using current technology, for example, a party might be called upon to produce word processing documents, e-mail messages, electronic spreadsheets, different image or sound files, and material from databases. Requiring that such diverse types of electronically stored information all be produced in the same form could prove impossible, and even if possible could increase the cost and burdens of producing and using the information. The rule therefore provides that the requesting party may ask for different forms of production for different types of electronically stored information.
“The rule does not require that the requesting party choose a form or forms of production. The requesting party may not have a preference. In some cases, the requesting party may not know what form the producing party uses to maintain its electronically stored information. …
“The responding party also is involved in determining the form of production. In the written response to the production request that Rule 34 requires, the responding party must state the form it intends to use for producing electronically stored information if the requesting party does not specify a form or if the responding party objects to a form that the requesting party specifies. Stating the intended form before the production occurs may permit the parties to identify and seek to resolve disputes before the expense and work of the production occurs. A party that responds to a discovery request by simply producing electronically stored information in a form of its choice, without identifying that form in advance of the production in the response required by Rule 34(b) runs a risk that the requesting party can show that the produced form is not reasonably usable and that it is entitled to production of some or all of the information in an additional form. Additional time might be required to permit a responding party to assess the appropriate form or forms of production. …
“[T]he option to produce in a reasonably usable form does not mean that a responding party is free to convert electronically stored information from the form in which it is ordinarily maintained to a different form that makes it more difficult or burdensome for the requesting party to use the information efficiently in the litigation. If the responding party ordinarily maintains the information it is producing in a way that makes it searchable by electronic means, the information should not be produced in a form that removes or significantly degrades this feature.”
2) New Wis. Stat. Section 804.01(4m): New “meet-and-confer” obligation. The Judicial Council’s original April 23, 2009, petition did not include a meet-and-confer provision. However, several of the justices expressed concern during the Jan. 15, 2010, public hearing that such a meet-and-confer provision was necessary to meet the unusual circumstances that may arise in the age of electronic litigation. Accordingly, the amended petition submitted to the court on March 19, 2010, contained the following new subsection:
“804.01 (4m) DISCOVERY CONFERENCE. At any time after commencement of an action, on the court’s own motion or the motion of a party, the court may order the parties to confer by any appropriate means, including in person, regarding:
“(a) the subjects on which discovery may be needed, when discovery should be completed, and whether discovery should be conducted in phases or be limited to particular issues;
“(b) discovery of electronically stored information, including preservation of the information pending discovery and the form or forms in which the information will be produced;
“(c) the method for asserting or preserving claims of privilege or of protection of trial-preparation materials, and to what extent, if any, such claims may be asserted after production;
“(d) the cost of proposed discovery and the extent to which discovery should be limited, if at all, under s. 804.01(3)(a); and
“(e) in exceptional cases involving protracted actions, complex issues or multiple parties, the utility of the appointment by the court of a referee under s. 805.06 or an expert witness under s. 907.06 to supervise or inform the court on any aspect of discovery.”
* * *
In its March 19, 2010, amended petition, the Judicial Council also created a Judicial Council Note to be appended to this new rule, which reads as follows:
“Sub. (4m) was created as a measure to manage the costs of discovery. If the parties confer before embarking on discovery, they can reduce the ultimate cost of discovery. This provision was created as part of a package of revisions to address issues relating to discovery of electronically stored information, but the provision applies generally, except where specifically limited. The subsection is modeled on similar provisions in the Uniform Rules Relating to the Discovery of Electronically Stored Information, Federal Rule of Civil Procedure 26(f), and on civil procedure rules of other states. The proposal does not mandate a discovery conference in every case. In appropriate cases, it empowers a court to order parties to confer if they do not do so voluntarily. Parties who confer and feel the need for further court intervention may consider the provisions of ss. 802.10(3), 804.01(3), 805.06 and 907.06.”
At the supreme court’s April 28, 2010, public conference, a majority of the court decided that this provision should be mandatory, at least in cases involving e-discovery. As of this writing, the court staff and council staff have not decided on wording to implement a “mandatory” meet and confer. The language that will be employed in a mandatory version of section 804.01(4m) will be the subject of another supreme court proceeding in September 2010.
Attorneys should study this rule carefully because it is new to Wisconsin practice. If attorneys have concerns about how this rule (or any of the other new e-discovery rules) may affect their practices, they should write to the chief justice before the supreme court reconsiders the issue covered by section 804.01(4m).
3) New Section 804.08(3): Producing electronic business records in lieu of an answer to an interrogatory. The Judicial Council specified in its petitions that the language “electronically stored information” be specified among the types of business records a business may provide in response to an interrogatory. New subsection 804.08(3) provides:
“OPTION TO PRODUCE BUSINESS RECORDS. If the answer to an interrogatory may be determined by examining, auditing, compiling, abstracting, or summarizing a party’s business records, including electronically stored information, and if the burden of deriving or ascertaining the answer will be substantially the same for either party, the responding party may answer by:
“(a) specifying the records that must be reviewed, in sufficient detail to enable the interrogating party to locate and identify them as readily as the responding party could; and
“(b) giving the interrogating party a reasonable opportunity to examine and audit the records and to make copies, compilations, abstracts, or summaries.”
One of the desires the justices expressed on Jan. 15, 2010, was that the new e-discovery rules more closely parallel the federal e-discovery rules so that it would be easier to bring federal authority to bear in discovery disputes that arise in Wisconsin courts. In its March 19, 2010, amended petition, the Judicial Council accomplished this by adopting extensive portions of the federal advisory commentary to the federal rules. That commentary is set forth in part in the accompanying sidebars. The federal commentary for section 804.08(3) is set forth in the sidebar entitled “What is ‘Electronically Stored Information’?”
Because the new rule in section 804.08(3) is substantially the same as Federal Rule of Civil Procedure 33(d), the comments to this federal rule and federal case law should be persuasive authority when dealing with issues under new Wis. Stat. section 804.08(3).
There are very good reasons why a business might wish to exercise its option under a rule such as new section 804.08(3). As a federal court observed:
“Generally, if the information sought is contained in the responding party’s files and records, he or she is under a duty to search the records to provide the answers. See Govas v. Chalmers, 965 F.2d 298, 302 (7th Cir. 1992). But where the information is contained in business records and answering the question would require the responding party to engage in burdensome or expensive research, the responding party may answer by specifying the records from which the answer may be obtained and making them available for inspection by the party seeking discovery.”21
Attorneys should consider and consult with the client about the difficulties that may arise if they exercise the option under section 804.08(3). As noted in the federal commentary contained in the Judicial Council Note under section 804.08(3):
“Depending on the circumstances, satisfying these provisions with regard to electronically stored information may require the responding party to provide some combination of technical support, information on application software, or other assistance. The key question is whether such support enables the interrogating party to derive or ascertain the answer from the electronically stored information as readily as the responding party. A party that wishes to invoke Rule 33(d) by specifying electronically stored information may be required to provide direct access to its electronic information system, but only if that is necessary to afford the requesting party an adequate opportunity to derive or ascertain the answer to the interrogatory.”22
By exercising the option to produce access to electronically stored information under section 804.08(3), a business may open the door to being required to provide technical support or even software so that a discovering party can ascertain an answer. Courts have in some cases required parties to design a computer program to extract data from computerized business records.23 A business that exercises this option may be vulnerable to a claim that the opposing party be granted access to the computer system to ensure that the records are as easily accessible to the discovering party as they are to the producing party. Although there are benefits to exercising the business-records option, counsel should bear in mind that the option is not mandatory. As the comment to Federal Rule of Civil Procedure 33(d) points out,
“[T]he responding party’s need to protect sensitive interests of confidentiality or privacy may mean that it must derive or ascertain and provide the answer itself rather than invoke Rule 33(d).”
4) New Section 804.09(1) & (2): Treating electronically stored information the same as paper documents; selecting the format in which to produce electronically stored information. The heart of the new electronic discovery rules is in the subsections of sections 804.09(1) and (2). These sections are the mechanisms governing the formulation and response to electronic discovery requests. New section 804.09 provides, in pertinent part, as follows:
“804.09(1) SCOPE. A party may serve on any other party a request within the scope of s. 804.01 (2):
“(a) to produce and permit the requesting party or its representative to inspect, copy, test or sample the following items in the responding party’s possession, custody, or control:
“1. any designated documents or electronically stored information, including writings, drawings, graphs, charts, photographs, sound recordings, images, and other data or data compilations stored in any other medium from which information can be obtained either directly or, if necessary, after translation by the responding party into a reasonably usable form; or
“2. any designated tangible things; or
“(b) to permit entry onto designated land or property possessed or controlled by the responding party, so that the requesting party may inspect, measure, survey, photograph, test, or sample the property or any designated object or operation on it.”
“804.09(2) PROCEDURE. (a) Except as provided in s. 804.015, the request may, without leave of court, be served upon the plaintiff after commencement of the action and upon any other party with or after service of the summons and complaint upon that party, and shall describe with reasonable particularity each item or category of items to be inspected. The request shall specify a reasonable time, place, and manner of making the inspection and performing the related acts. The request may specify the form or forms in which electronically stored information is to be produced.
“(b)1. The party upon whom the request is served shall serve a written response within 30 days after the service of the request, except that a defendant may serve a response within 45 days after service of the summons and complaint upon that defendant. The court may allow a shorter or longer time. The response shall state, with respect to each item or category, that inspection and related activities will be permitted as requested, unless the request is objected to, in which event the reasons for objection shall be stated. If objection is made to part of an item or category, the part shall be specified. The response may state an objection to a requested form for producing electronically stored information. If the responding party objects to a requested form, or if no form was specified in the request, the party shall state the form or forms it intends to use.
“(c) The party submitting the request may move for an order under s. 804.12(1) with respect to any objection to or other failure to respond to the request or any part thereof, or any failure to permit inspection as requested.
“804.09(2)(b)2. Unless otherwise stipulated or ordered by the court, these procedures apply to producing documents or electronically stored information:
“a. A party shall produce documents as they are kept in the usual course of business or shall organize and label them to correspond to the categories in the request;
“b. If a request does not specify a form for producing electronically stored information, a party shall produce it in a form or forms in which it is ordinarily maintained or in a reasonably usable form or forms; and
“c. A party need not produce the same electronically stored information in more than one form.”
* * *
The Judicial Council Note to new section 804.09 also is derived from the federal advisory commentary and is quite extensive. The Judicial Council Note is set forth in the accompanying sidebar entitled “How to Formulate and Respond to E-Discovery Requests.”
The federal counterpart to new Wis. Stat. section 804.09 is Federal Rule of Civil Procedure 34. Therefore, the Advisory Committee Note to the federal rulse and federal cases should provide persuasive authority when dealing with issues under new Wis. Stat. section 804.09.
The term “electronically stored information” is used in both Wis. Stat. section 804.09 and Rule 34 so as to broaden significantly the concept of what constitutes a “document” for the purposes of e-discovery. The Advisory Committee Note to the 2006 amendment to Federal Rule of Civil Procedure 34 explains:
“Lawyers and judges [have strained to interpret] the term ‘documents’ to include electronically stored information because it was obviously improper to allow a party to evade discovery obligations on the basis that the label had not kept pace with changes in information technology. But it has become increasingly difficult to say that all forms of electronically stored information, many dynamic in nature, fit within the traditional concept of a ‘document.’ Electronically stored information may exist in dynamic databases and other forms far different from fixed expression on paper. Rule 34(a) is amended to confirm that discovery of electronically stored information stands on equal footing with discovery of paper documents.”
Production Responsibilities. In terms of e-discovery, Federal Rule of Civil Procedure 34 and Wis. Stat. section 804.09 impose several related e-discovery responsibilities.
Producing attorneys must be aware of all forms in which electronically stored information is stored on a client’s system. Electronically stored information includes native files (files that incorporate the content but also the software functions necessary to use the document, for instance, an Excel spread sheet) and everything that may be associated with those files, such as metadata.24 Even deleted files are discoverable, and a producing party can be compelled to produce such files if they can be restored without unreasonable expense or effort.25 Document-retention policies cannot be used to frustrate discovery or destroy unhelpful evidence, and those policies must be suspended when litigation becomes probable.26
Preservation Responsibilities. Preservation responsibilities are different from production responsibilities. A party may have legitimate objections to production, based on privilege or trade secrets, but that does not excuse the duty to preserve.
The duty to preserve documents in the face of pending or threatening litigation is not a passive obligation; it must be discharged actively.27 It rests on the shoulders of both attorneys and senior corporate officers.28 Attorneys for a business or governmental agency must take steps to learn of a client’s file system and document-retention policies as soon as it is reasonably clear that litigation is probable and must be prepared to impose a “litigation hold” on the activities of a computer system so as to prevent the loss of any relevant data.29 A written preservation plan is crucial to avoid criticism for failing to preserve data.30 Attorneys must supervise the litigation hold to ensure compliance.31
Attorneys, in cooperation with competent forensic experts, should undertake or supervise a careful search for responsive documents. The failure to conduct a thorough search might lead a court to permit an adverse party itself to search the records, by direct access to the responding party’s computer system.32
Under new Wis. Stat. section 804.09(2)(a), the discovering party may specify the form in which electronically stored information is to be produced, which may include native file productions or productions in some generic file format, such as PDF or TIFF images. A responding party may object to the form and offer an alternate form of production.
If the discovering party does not specify a form, then before actually producing electronically stored information the responding party must specify the form that will be used. This will give the discovering party an opportunity to object, thus avoiding unnecessary expense. Attorneys for a producing party are required under the terms of Wis. Stat. section 804.09(2)(b)2.a. “to produce documents as they are kept in the usual course of business or shall organize and label them to correspond to the categories in [a section 804.09] request.” Even if the discovering party does not specify a form, under section 804.09(2)(b)2.b. “a party shall produce it in a form or forms in which it is ordinarily maintained or in a reasonably usable form or forms.”33 As noted by the Advisory Committee Note to the 2006 amendment to Federal Rule of Civil Procedure 34(b), production of electronically stored information should be done so as “to protect against deliberate or inadvertent production in ways that raise unnecessary obstacles for the discovering party.”
The failure to prevent the destruction of electronically stored information, except as immunized by the new amendment to Wis. Stat. section 805.12(5) (discussed below), can result in charges of spoliation. Wisconsin already has a well-developed body of law governing evidence spoliation,34 but the perils are greater when a party is faced with charges of electronically-stored-information spoliation. Although courts are generally loathe to permit direct access to and searches of another party’s computer system,35 if a court is presented with evidence of spoliation, a court may be more inclined to permit the other party’s forensic experts to search the responsible party’s computer system directly.36
If electronically stored information has been produced in one format, under section 804.09(2)(c) the responding party need not produce it in a different format. If electronically stored information is sought that is not reasonably accessible and that will involve an unreasonable burden and expense to retrieve, then attorneys should be alert to the possibility that it may be possible to shift costs to the discovering attorney and client before pursuing such access. Cases such as Zubulake37 and Rowe38 and their progeny should prove invaluable in this regard.
5) New Section 804.12(4m): “Safe harbor” for routine deletion of electronically stored information. The new rules immunize a party from spoliation sanctions if the information that is deleted or otherwise destroyed was done so as the result of the routine operation of the computer system. Computers routinely destroy information. They write over previously recorded information. Every time a file is opened and closed, a computer saves the new version of the document and erases information about the previous version of the document. Every time computers are started or shut down, the computer updates its files, and in the process of doing so, information about those files is altered. “As a result, the ordinary operation of computer systems creates a risk that a party may lose potentially discoverable information without culpable conduct on its part.”39
The new rules address this potential quandary by creating a safe harbor. Under new subsection 804.12(4m), “[a]bsent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system.”
What is ‘Electronically Stored Information’?
To bring federal authority to bear in discovery disputes that arise in Wisconsin courts, the Judicial Council adopted extensive portions of the federal advisory commentary to the federal rules, including the note for Wis. Stat. section 804.08(3) that defines “electronically stored information.”
The Judicial Council Note for section 804.08(3) will read as follows:
“The meaning of the term ‘electronically stored information’ is described in the Judicial Council Note following s. 804.09. Section 804.08 (3) is taken from F.R.C.P. 33(d). Portions of the Committee Note of the federal Advisory Committee on Civil Rules are pertinent to the scope and purpose of s. 804.08(3): ‘Special difficulties may arise in using electronically stored information, either due to its form or because it is dependent on a particular computer system. Rule 33(d) allows a responding party to substitute access to documents or electronically stored information for an answer only if the burden of deriving the answer will be substantially the same for either party. Rule 33(d) states that a party electing to respond to an interrogatory by providing electronically stored information must ensure that the interrogating party can locate and identify it ‘as readily as can the party served,’ and that the responding party must give the interrogating party a ‘reasonable opportunity to examine, audit, or inspect’ the information. Depending on the circumstances, satisfying these provisions with regard to electronically stored information may require the responding party to provide some combination of technical support, information on application software, or other assistance. The key question is whether such support enables the interrogating party to derive or ascertain the answer from the electronically stored information as readily as the responding party. A party that wishes to invoke Rule 33(d) by specifying electronically stored information may be required to provide direct access to its electronic information system, but only if that is necessary to afford the requesting party an adequate opportunity to derive or ascertain the answer to the interrogatory. In that situation, the responding party’s need to protect sensitive interests of confidentiality or privacy may mean that it must derive or ascertain and provide the answer itself rather than invoke Rule 33(d).”
By routine operation, the rule refers to the ways in which such systems are generally designed, programmed, and implemented to meet the party’s technical and business needs.
“The ‘routine operation’ of computer systems includes the alteration and overwriting of information, often without the operator’s specific direction or awareness, a feature with no direct counterpart in hard-copy documents.”40
Good faith operation of an information system refers to whether or not a party operates its computer system according to normal operating protocols and in observance of preservation obligations. A party that deliberately modifies or suspends certain features of its system, causing the loss of information that would otherwise be recoverable, might not be operating in good faith. The good-faith requirement bars a party from exploiting the routine operation of its information system to thwart discovery obligations.
Duties of Discovering Attorneys
The first duty of discovering attorneys is simply to recognize that it may be malpractice not to take careful account of the probability that much of the evidence the client needs access to for litigation may reside on an adversary’s computer system. If e-discovery is indicated, and unless the discovering attorney is extraordinarily well versed in computer operations and searches, the first step should be to retain the services of a competent forensic computer expert. The next step should be to develop a comprehensive discovery plan.41
While the details of what should go into a discovery plan are beyond the scope of this article, several points should be stressed. First, the plan should begin with the issuance of a preservation letter as soon as possible. Second, discovering attorneys, at a minimum, should understand that effective e-discovery is impossible if the attorney does not understand the architecture and nature of an opposing party’s computer system. This understanding should prompt the discovering attorney to conduct a two-tier approach to e-discovery. This two-tier approach should entail the taking of two separate and distinct sets of interrogatories (possibly coupled with relevant depositions).
“Early in a lawsuit, serve interrogatories that seek only information about the other party’s computer systems. These interrogatories should seek to carefully define possible sources of digital evidence and inquire whether those sources exist on a computer system and where they are stored. Also inquire as to which software programs and operating systems are being used by a the party (including all of the technical specifications), and get the user and administrative manuals used in connection with all relevant software and operating systems that are not available commercially.”42After this step, if a discovering party is still not ready to issue interrogatories to uncover specific evidence, it may be wise to pursue discovery addressed to a corporation using a Federal Rule of Civil Procedure 30(b)(6) subpoena or notice directed to finding out more about a producing party’s computer system. The state counterpart is a Wis. Stat. section 804.05(2)(e) subpoena or notice.
While discovery plans are beyond the scope of this article, discovering attorneys should avoid the serious misjudgment of assuming that it does not matter how or in what form evidence is produced. Often, when it comes to e-discovery, “the devil is in details.” And there is much in the details when it comes to e-discovery.
For example, if an attorney accepts paper discovery or PDFs, the attorney might never know about very important evidence connected with the electronically stored information possessed by the opposing party. An obvious example is metadata, the information contained within an electronic document that may identify when and by whom it was created and when and by whom it was reviewed. Discovering attorneys should always be alert to the potential of metadata; the best way to capture that metadata is for attorneys to exercise the option under sections 804.09 and 804.09(2)(b)1. and to request receipt of information in its native format or in a format completely preserving all relevant metadata. There are several manuals and guides to pursuing the discovery of metadata,43 but a discovering party should retain a forensic computer expert in searching for and evaluating metadata.
The assumption that paper documents or PDF images are satisfactory because one can always seek to receive discovery in a different format at a later date is incorrect. Under section 804.09(2)(c), the responding party need not produce the fruits of discovery in more than one format.
The new e-discovery rules have been carefully considered and studied by the Wisconsin Judicial Council. While there may be more that can be done to streamline the management of e-discovery and relieve potential burdens on the court (especially in terms of strengthening the special-master system under section 805.06), the proposed rules represent a balanced and useful development that will enable discovering attorneys, producing attorneys, and the courts to deal effectively and efficiently with e-discovery.
Again, attorneys concerned with how the new rules may affect Wisconsin practice should notify the chief justice by letter before September 2010.