17
Mar2014

Evolution of Massachusetts Civil Procedure

civil procedure

E-DISCOVERY AND METADATA
by James M. McCarthy, Esq. & Anthony T. Panebianco, Esq. 


I. PURPOSE AND SCOPE 

The purpose of this Memo is to outline and briefly explain the changes to the Massachusetts Rules of Civil Procedure that became effective on January 1, 2014. The changes address the new reality that most business records are stored electronically. By including electronically stored information (ESI) in the Rules of Civil Procedure, the SJC is seeking to foster cooperation between opposing counsel and allow the Trial Court to maintain active participation in the discovery process from the early stages of litigation.

Rules 16, 26, 34, 37, and 45 have been amended by the SJC and have been implemented in every Department of the Trial Court since January 1, 2014. The 2014 Reporter’s Notes to New Rule 26 explain that the purpose of these new rules is to address the staggering amount of electronic or digital data stored by companies and individuals in place of old paper files. Today, most large business computer networks store information measured in terabytes. Each terabyte represents the equivalent of 500 billion typewritten pages of plain text.

The Standing Advisory Committee for the Massachusetts Rules adopted the reasoning behind the changes to the Federal Rules of Civil Procedure in 2006. The goals of the changes are: (1) provide early attention to electronic discovery issues, (2) provide better management of discovery into electronically stored information, (3) set out a procedure for assertions of privilege after production, (4) clarify the application of the rules relating to interrogatories and requests for production of documents to electronically stored information, and (5) clarify the application of the sanctions rules to electronically stored information.

Mass. R. Civ. P. 26 Reporter’s Notes to the 2014 amendments.

Not only has the volume of data increased significantly, the type of information that is now available has increased as well. Companies continue to electronically maintain the same business documentation as the old hard copy versions of contracts, correspondence, invoices, etc. However, the computers and databases through which these documents are created and stored contain unique information of their own. For example, a contract typed with a company computer using the company’s word processing program will be saved and retrieved just like a physical copy of the same contract. The contract can be produced and its contents understood by the reader. Now, however, that document also contains a font of information known as metadata. Metadata is the information that the computer uses to track and maintain that document in the system. Metadata will indicate when the document was created, by whom it was created, when and how any edits were made, and who may have accessed the document. Not only will the document contain the background metadata, the computer itself maintains what is called a Master File Table. The Master File Table functions as a Table of Contents for the computer and, absent a complete wiping of a hard drive, never erases itself. The Master File Table can be easily exported to an Excel spreadsheet to reveal anything, and everything, done on that computer. This metadata is discoverable and the scope of its production should be discussed by counsel at the beginning of litigation. Metadata is useful in criminal investigations into online activity because the computer logs everything accessed, created, or changed by the user. On the civil side, metadata is useful in the area of employment disputes and terminations. The company computer will tell if any corporate files were accessed, copied, or exported in the days prior to an employee quitting or after a poor performance review.

II. CHANGES TO THE RULES 

RULE 16: PRE-TRIAL PROCEDURE: FORMULATING ISSUES 

Not much of a change to Rule 16 other than to broaden the scope and include some electronic discovery issues. In addition to the original eight topics for discussion in a pre-trial conference under Rule 16, there are now three more issues to work out. The new issues have been inserted into the rule as (5)-(7) and they pertain to the timing and extent of discovery, the preservation and discovery of electronically stored information, and agreements or proceedings for asserting privilege or protections over the productions. This conference is still at the court’s discretion but it now allows complex ESI issues to be addressed at the beginning stages of litigation, with court involvement, in order to streamline the process.

RULE 26(b)(5): GENERAL PROVISIONS GOVERNING DISCOVERY 

The new rule retains the text of the old rule in section (A) regarding a Privilege Log. The new rule then adds provisions for when protected information has been mistakenly produced. This “clawback” provision allows materials erroneously produced to be retrieved without further disclosure or waiver of privilege. In order for the clawback provision to apply, a court should determine whether “(i) the disclosure was inadvertent; (ii) the holder of the privilege or protection took reasonable steps to prevent disclosure; and (iii) the holder promptly took reasonable steps to rectify the error.” If the court issues a ruling on the applicability of the clawback, the disclosure will not constitute a waiver of privilege in any other proceeding.

RULE 26(f): 

Rule 26(f) is a brand new rule and it addresses the ESI issue in discovery. Rule 26(f) first outlines the circumstances under which an ESI Conference may be requested by a party and what that conference should accomplish. As a matter of right, any party may request an ESI conference within 90 days from the service of a responsive pleading by any defendant. The request shall be served on each party that has appeared but shall not be filed with the court. Thereafter, such conference shall be conducted as soon as practicable but no later than 30 days after the request is served.

If, however, 90 days have passed since the service of the first responsive pleading, any party may request, without filing in court, that all parties who have appeared conference to discuss ESI issues. This later conference is not a matter of right and the other parties may not agree to such a meeting. If the parties cannot agree on an ESI conference within 30 days of the request, the requesting party may move for a Pre-Trial Discovery Conference with the court pursuant to Rule 16 and discuss ESI issues there.

The purpose of this ESI conference is for the parties to develop a plan relating to the discovery of ESI. The parties shall file a plan and statement with the court within 14 days of the conference to outline the course of discovery and present any unresolved issues to the court. The parties shall discuss preservation of ESI, form of production, possible production of metadata, timeframe for production, privilege and protection issues, methods for protecting proprietary information from third parties, allocation of expenses related to ESI, and any other ESI issues presenting to the parties. The court may also issue an order regarding the issues mentioned above at the request of the parties or sua sponte.

Any party may object to the retrieval and production of “inaccessible electronically stored information” which the party has determined is not reasonably accessible because of undue burden or cost. Any such objection must be accompanied by a reason as to why the information is inaccessible and the party claiming inaccessibility bears the burden of showing inaccessibility when faced with a motion to compel production. The court may order discovery of the inaccessible information after weighing the likely benefit of receipt against the burden of production, the amount in controversy, the resources of the parties, the importance of the issues, and the importance of the requested information in resolving those issues.

RULE 34: PRODUCTION OF DOCUMENTS 

Rule 34 has added sections dealing specifically with ESI and its production. The requests may now specify the form in which ESI should be produced. The responding party may object to that specification by the requesting party or, if no form is specified, shall state the form of ESI production. The ESI shall be produced as it is kept in the ordinary course of business or in any other reasonably usable form. The responding party, however, need not produce the same information in multiple forms.

RULE 37: SANCTIONS 

The New Rule 37 adds Section (f) which prevents a court from imposing sanctions, absent exceptional circumstances, for failing to produce ESI that was lost as a result of the “routine, good-faith operation of an electronic information system.”

RULE 45: SUBPOENAS 

A party may now seek ESI in a subpoena to a third party. However, Section (b) includes a duty on the issuing party or attorney to “take reasonable steps to avoid imposing undue burden or expense on a person subject to a subpoena.” The court may quash or modify an unreasonable or oppressive subpoena upon motion or may shift the cost of compliance to the requesting party.

Section (f) was also added which pertains to duties in responding to a subpoena. Such duties mirror those in Rule 34 document productions and Rule 26 clawback provisions.

III. ADDITIONAL INFORMATION 

Most of the changes implemented on January 1, 2014 simply broaden the scope of a given rule to encompass ESI in the text. The biggest change will be the adoption of Rule 26(f) which calls for discovery conferences specifically related to ESI. Even if opposing counsel will not agree to such a conference, Rule 16 has now been broadened to allow ESI conferences under that provision.

IV. IMPACT ON YOUR BUSINESS 

All aspects of a law firm’s business may be impacted by these new rule changes as well as the increased knowledge by adverse parties as to how metadata can be utilized. At the onset of any case, it is important to realize how the rule changes, as well as metadata, can impact the long-term case strategy and management.

For example, with regard to the new rules, it should be incumbent upon an attorney to inform their clients that the storage of electronic information and preservation of same begins not at the onset of actual litigation or a complaint filed by the on behalf of the client, but upon the first instance that a possible dispute arises. All possible accounting or email communications, all telephone log book entries by a bank once a defendant is a day or two late on a payment, all calls to a bank to ask for assistance in obtaining a Forbearance Agreement, or any other type of communication between a corporate client and a customer must be preserved from that point on. The preservation of same must be in accordance with the rules. Even though that incident may not ever result in actual litigation, the failure to preserve those materials opens a client up to sanctions should they fail to have done so if the matter does reach litigation.

Defendant companies in tort/personal injury cases will also have a responsibility to preserve all electronic discovery data from the point when litigation seems plausible. Defendants in those cases need to preserve records from the time the first customer complaint came in and/or perhaps a mechanic or engineer noticed some sort of defect within original plans for a product. These rules can be used as a vehicle in our favor and against a corporate or institutional client.

Similarly, the understanding of how metadata can affect a case is critical in determining every characteristic of a document. For example, emails, photos, word documents, and pdfs all contain extensive background information that shows changes made to the documents, document history, and even location of where it was created. A party suing for breach of contract could view the original contract in its pdf and/or word form and be able to understand the changes made to the document even though on its face one cannot tell any of the changes made. The changes could represent the original intent of the parties or the intent from the changes made thereafter.

Metadata may also be used to determine the quantity of time and number of individuals that worked on a particular document. This is important to note for both client management and at trial. For example, the metadata do show the quantitative time worked on a particular document. Questions may arise as to the attorneys’ fees and/or other information provided therein. Notes that an attorney may have typed to himself or herself within the body of a document as a placeholder to add additional language in the future can still be recovered through metadata, even if not added to the final document. Wherefore, an attorney’s thoughts and opinions as to a particular matter can be revealed if the metadata isn’t cleared prior to delivery to outside parties. It could be as simple as sending out answers to interrogatories where you say that there are ten Board of Directors’ meetings and enclose them but in your previous version, only ever seen by you, there were actually twelve, two of which you reserved for privileged issues but do not disclose the exact quantity of documents withheld. A technologically savvy opposing counsel could look at the final responses and see that a change was made and question that particular change.

One way to avoid this issue is to filter all documents through metadata cleansers, prior to sending the materials out to opposing counsel. Another way to scrub metadata from documents is to produce them in pdf format if originally in Word or Word Perfect. While pdf contains some metadata, it will be limited and will not contain the track changes or deleted comments that may have been included in the Word or Word Perfect versions.

In document requests, it will be helpful to request that the electronic data you are seeking be produced in the form that it is regularly maintained. That means that printouts of emails are not sufficient in said response. In those terms, we are able to then look at the metadata to see if anything has changed since receipt of other information.

With this decreased capacity to sufficiently control documents or safeguard the confidential data contained therein, it is incumbent upon attorneys to protect their client’s confidences. Unfortunately, there is no guideline in Massachusetts concerning the ethical rules for attorneys to scrub such data and/or not mine the data from adversary parties.

Wherefore, it is helpful to always be cautious of how these new rules and metadata can impact every case at the onset. Establishing a plan earlier on with opposing counsel can avoid serious pitfalls later.

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