[UPDATE] In Defense of Genger, Part II

UPDATE:

I hate to say I told you so, but...wait, no I don't.

Yesterday, the Delaware Supreme Court issued its opinion in this matter affirming the Court of Chancery's spoliation finding. The Court held the spoliation finding proper, because Genger took affirmative steps to overwrite unallocated space, saying:

We do not read the Court of Chancery’s Spoliation Opinion to hold that as a matter of routine document-retention procedures, a computer hard drive’s unallocated free space must always be preserved. The trial court rested its spoliation and contempt findings on more specific and narrow factual grounds—that Genger, despite knowing he had a duty to preserve documents, intentionally took affirmative actions to destroy several relevant documents on his work computer. These actions prevented the Trump Group from recovering those deleted documents for use in the Section 225…

Compare with my statements below that

The [Court of Chancery] opinion in this case does not require preservation of all unallocated space in every case. Genger was sanctioned because he took affirmative steps to overwrite unallocated space, in violation of the Court's order... [T]here is nothing in this opinion that creates any requirement to preserve unallocated space. Rather, the opinion only says you shouldn't go out of your way to destroy it.

I feel quite vindicated in my defense, considering there were some persons and organizations of import in the eDiscovery community lined up on the other side. Obviously, reasonable minds can disagree, especially in interpreting court decisions. Ultimately, I am thankful that the Supreme Court's decision should allay any fears created by certain interpretations of the Court of Chancery's spoliation decision.

ORIGINAL POST (2011-03-11 13:20:45):

I had almost given up on writing this post considering how long it has been since I posted In Defense of Genger, Part I and (more importantly) how long it has been since the publication of the posts I am taking issue with.  However, the ongoing confusion about this case has prompted me to action. 

If you have read Part I, you are familiar with the Court of Chancery's decision in TR Investors LLC v. Genger, C.A. 3994-VCS (December 9, 2009) and with the allegations made by Leonard Deutchman, General Counsel at LDiscovery LLC, in a two-part post hosted by Law.com. <!--You also understand why there's a picture of Austin Powers.--> For those who are not familiar, Mr. Deutchman asserts that the Court got the decision wrong because it (1) does not understand the technology involved (Part 1) and (2) does not understand the law of eDiscovery (Part 2).

It's sufficient to say that I respectfully disagree with Mr. Deutchman on both charges. Rebutting his posts was a fun, interesting exercise for me, but it didn't seem terribly important. I saw it as an esoteric debate between eDiscovery geeks. That has changed, because, today, a prominent media outlet has published a post that elevates the confusion about this opinion and will cause unnecessary fear among corporate counsel.

The latest case of hand-wringing and confusion over this decision comes to us from none other than Forbes by way of Daniel Fisher's post "Delaware Ruling Would Require Massive Data Backups."  Mr. Fisher opens his post stating that:

A little-noticed decision by a Delaware court has the potential to impose huge costs on companies unless it is reversed, computer-security experts say...[e]xperts say retaining such data would be prohibitively expensive since the unallocated space is essentially a trash bin that is altered each time a key is tapped.

<!--Scary, huh?-->

Despite the fact that Mr. Fisher twice refers to "experts" (plural) as the source for these hyper-ventilations, his lone identified source for the post is Daniel Garrie, a lawyer and managing director at Focused Solution Recourse Delivery Group LLC , a computer consulting firm in Seattle. <!--Garrie and Deutchman are both lawyers with eDiscovery vendors. Is there anything to that?--> Mr. Fisher's post continues:

“It’s almost impossible for large companies with massive amounts of equipment to comply,” said Garrie... “I don’t even know if it’s possible,” said Garrie. “I mean, anything’s possible with enough money,” but companies would have to take bit-level images of their hard drives on a regular basis and store them somewhere, to be retrieved each time they are sued. That means all the time for most large companies. The costs would be “exponentially larger,” than current electronic discovery measures. “Several large global companies,” clients he declined to name, “have expressed concern.”

Let me clear up the confusion: The opinion in this case does not require preservation of all unallocated space in every case. Genger was sanctioned because he took affirmative steps to overwrite unallocated space, in violation of the Court's order and without first telling anyone. The routine, passive overwriting of unallocated space was NOT the cause for any sanctions here, so there is nothing in this opinion that creates any requirement to preserve unallocated space. Rather, the opinion only says you shouldn't go out of your way to destroy it. Big, BIG difference. <!--If there are doubts about the Court of Chancery's understanding of eDiscovery, please see their recently released "Guidelines for Preservation of Electronically Stored Information" that clearly embraces the principles of cooperation, reasonableness, and proportionality.-->

To Mr. Garrie's credit, he is consistent—he is co-author of an article in the Northwestern Journal of Technology and Intellectual Property that makes the same mistaken arguments, and he filed a brief with the Delaware Supreme Court arguing for reversal of the Genger opinion. I obviously disagree with Mr. Garrie's opinions on this matter, but I am here to help, so I say:

Mr. Garrie, for the “[s]everal large global companies [that] have expressed concern,” please send them a link to this post and tell them not to worry.

I don't actually expect Mr. Garrie will do that, but perhaps some of his clients will stumble upon this post, in which case here is my advice to them:

If you act cooperatively and transparently, you will be fine. If you find yourself in a similar position to Mr. Genger's, share your concerns with opposing counsel and the court before you do anything. Don't take matters into your own hands and violate a court order by wiping a hard drive in the middle of the night—it's bad form and will only get you in trouble.

Stayed tuned for the decision of the Delaware Supreme Court—I may have a lot of words to eat...

<!--Thanks to flickr user cliff1066™ for the Austin Powers pic.-->

[UPDATE] Self-Collection Prohibited in Delaware

UPDATE:

A colleague recently spoke to Vice Chancellor Laster about this opinion, and the Vice Chancellor reportedly said, "No self-collection in my Court."  I'm not sure that statement addresses my distinction between collection and review, but it does reinforce the Vice Chancellor's opposition to unsupervised custodian document collection.

Also, below is the presentation I made for use in briefing this case for the Herrmann Technology Inn of Court:

 

ORIGINAL POST:

Recently, Vice Chancellor Laster gave some of us a jolt with a bench ruling on a discovery dispute in Roffe v. Eagle Rock Energy GP, et al., C.A. No. 5258-VCL (Del. Ch. Apr. 8, 2010). The ruling addresses the issue of client self-collection and a lawyer's oversight duties.

The Association of Corporate Counsel's (AAC) website carried a summary of the ruling authored by Morgan Lewis & Bockius LLP that stated:

Vice Chancellor Laster ruled from the bench that confirmatory discovery—like formal discovery—requires the defendant’s attorney to be physically present during the collection of electronically stored information from his/her client; self collection by the client is not permitted.

Well-known eDiscovery expert, Kevin Brady of Connolly Bove in Delaware, explained that the ruling:

[P]ointed out that lawyers have an affirmative duty to be actively engaged in the collection process to the point that a lawyer should meet in person with the client to physically review his or her electronic information repositories wherever they may be located (including, if necessary, personal computers if that is where relevant information is stored).

I think Kevin's summary is much closer to the mark, and I'll explain why in a minute. First, the language causing concern is on lines 12-19 on page 10 of the attached transcript and reads as follows:

[Y]ou do not rely on a defendant to search their own e-mail system... There needs to be a lawyer who goes and makes sure the collection is done properly... we don't rely on people who are defendants to decide what documents are responsive, at least not in this Court.

The AAC article suggests there are two things implicated by this, and other supportive, language in the ruling: (1) client self-collection is not allowed, and (2) an attorney must be present during data collection. I think that interpretation assumes the worst and goes too far.

On the issue of self-collection, when the Court says not to "rely on a defendant to search their own e-mail system" and "we don't rely on people who are defendants to decide what documents are responsive," I believe the Court refers specifically to the practice of a client acting as document reviewer and sole arbiter of responsiveness. That is well understood to be a bad practice, so there is nothing shocking about this pronouncement.

I do not think the Court, in this ruling, has said that client bulk self-collection is impermissible. I see nothing in this ruling that would prohibit a client from gathering a mass of potentially responsive documents, e.g. full email accounts for all custodians, with guidance from counsel and turning them over to counsel for review. Counsel must review all potentially responsive documents and make final responsiveness determinations.

On the issue of requiring counsel's physical presence during collection, I again think the AAC article's interpretation of the Court's ruling goes too far. The AAC article seems to rely on the word "goes" in the Court's statement that "[t]here needs to be a lawyer who goes and makes sure the collection is done properly" for the proposition that counsel must 'go' and be physically present for collection. I think we get the spirit of the Court's statement by removing the 'go' part: "[t]here needs to be a lawyer who... makes sure the collection is done properly." That is well understood to be a best, if not required, practice, so there is nothing shocking about this pronouncement either.

To be fair, there are other references in the ruling to lawyers 'getting on a plane' to get data, but these suggestions seem to be case specific.  In this case, Plaintiff was supposed to be conducting confirmatory discovery on three board directors but only collected from two.  The third was a Mr. Smith. So the Vice Chancellor suggests that someone get on a plane to go get Mr. Smith's documents ("And you certainly need to put somebody on a plane to go out and see Mr. Smith." page 10, line 20; "So the question for me would be, one, how fast can you do this right? And that means not only the e-mails from Mr. Smith. As I say, somebody should have been on a plane a long time ago to go through his e-mails. And if he chose to use his personal computer, well, that was his bad choice. All right? And if he has it mixed in other stuff that he gets, 150 e-mails a day, or whatever, that was his bad choice. That makes it all the more essential that a lawyer get on a plane, and go and sit down with Mr. Smith, and go through his e-mail and make sure that what is produced is -- what is responsive is appropriately produced." page 12, lines 1-13). This seems to be a specific issue with Mr. Smith in this particular case requiring the physical presence of counsel to ensure collection of, perhaps, an unwilling participant.

I think my reading of this transcript aligns with Kevin Brady's in that lawyers need to be engaged in the discovery process and may need to be physically present during data collection. If, however, my interpretation is wrong and a lawyer is required to be present during collection that may only be conducted by a vendor, the cost of discovery in Delaware may be on the rise.

Best Practices in Managing Discovery: Strategies & Tactics to Control Spending, Reduce Volume and Streamline Processes

I am honored to be a co-panelist with Richard Baer of Qwest Communications, in a LexisNexis® webinar tomorrow, Thursday, September 23, from 2-3 pm EST.  Rich is Chief Administrative Officer and General Counsel for Qwest, and we will be discussing best practices for managing discovery in-house.

Here is a short summary from the webinar's website:

If your law department is under pressure to control rising costs associated with discovery, you’re not alone. In an average case, discovery expenses now represent 50% of total litigation costs—and in some cases up to 90%.

In this free Webinar, we’ve paired in-house counsel Richard Baer of Qwest Communications and outside counsel Chris Spizzirri of Morris James LLP—two professionals who are expert at minimizing the burden and costs associated with discovery. Register today to discover best practices for:

  • Creating and implementing policies and procedures to streamline every phase of discovery, from preservation efforts to document production
  • Utilizing technology to organize and deal with large volumes of data
  • Assembling and managing response and discovery teams including internal staff, outside counsel, contract attorneys and non-attorneys
  • And more strategies and tactics

Please Register now and join us for an informative session.

18 Morris James Attorneys Selected by their Peers for Inclusion in The Best Lawyers in America® 2011

18 Morris James attorneys in 13 practice areas were recently selected by their peers for inclusion in The Best Lawyers in America® 2011.  New to the list are Mark D. Olson and Bruce W. Tigani from the firm’s Tax, Estates and Business practice.  The firm’s Real Estate Practice Group Chair, Richard Beck, has been named in this highly regarded publication since its inception in 1983. 

The Best Lawyers in America® 2011 has become universally regarded as the definitive guide to legal excellence.   Their rigorous research is based on an exhaustive peer-review survey in which more than 39,000 leading attorneys cast almost 3.1 million votes on the legal abilities of other lawyers in their practice areas.  The Morris James attorneys listed in the 2011 edition and the areas of law in which they are recognized include:

COMMERCIAL LITIGATION
• P. Clarkson Collins, Jr. (2005)
• Lewis H. Lazarus (2006)
• Edward M. McNally (2005)
• James W. Semple (2009)

CORPORATE LAW
• P. Clarkson Collins, Jr. (2005)
• Lewis H. Lazarus (2006)
• Edward M. McNally (2005)

ELDER LAW
• Mary M. Culley (2008)

EDUCATION LAW
• David H. Williams (2007)

FAMILY LAW
• Gretchen S. Knight (2007)

INFORMATION TECHNOLOGY LAW
• Richard K. Herrmann (2003)

INSURANCE LAW
• Mary B. Matterer (2009)

LABOR AND EMPLOYMENT LAW
• David H. Williams (2007)

PERSONAL INJURY LITIGATION
• Keith E. Donovan (2009)
• Dennis D. Ferri (2007)
• Richard Galperin (2005)
• Francis J. Jones, Jr. (2008)

REAL ESTATE LAW
• Richard P. Beck (1983)
• John Bloxom IV (2010)

TAX LAW
• Daniel P. McCollom (2007)
• Mark D. Olson (2011) *
• Bruce W. Tigani (2011) *

TECHNOLOGY LAW
• Richard K. Herrmann (2003)

TRUSTS AND ESTATES
• Mary M. Culley (2008)

* Indicates First Year on List
 

Benchmark Litigation 2011 Names 5 Morris James Partners Among Top "Local Litigation Stars"

Morris James LLP is pleased to announce that five of its partners have been recognized among the top Delaware litigation attorneys in Benchmark Litigation 2011 - The Guide to America's Leading Litigation Firms and Attorneys.

Morris James’ Litigation Stars

Rich Galperin 
Clark Collins
Richard Herrmann
Lewis Lazarus
Edward McNally

Benchmark Litigation focuses exclusively on litigation lawyers and firms in the United States.  Recommendations are based on extensive face-to-face and telephone interviews with the nation’s leading private practice lawyers and in-house counsel.

Chambers USA Names 10 Morris James Partners In Their 2010 Guide to Leading Business Lawyers

Morris James LLP is pleased to announce that ten of its partners have been ranked among the leading Delaware lawyers in the 2010 edition of Chambers USA:  America’s Leading Lawyers for Business - an increase of two rankings from last year.    In addition, four practice areas including Bankruptcy/Restructuring, Chancery, Intellectual Property and Employment Law were identified among the leading practices in Delaware.   The Morris James partners selected for inclusion in the 2010 edition are:

Bankruptcy/Restructuring

  • Brett Fallon
  • Carl N. Kunz
  • Stephen M. Miller

Chancery

  • Edward M. McNally
  • Lewis H. Lazarus
  • P. Clarkson Collins, Jr.

Intellectual Property

  • Mary M. Matterer
  • Richard K. Herrmann

Labor and Employment

  • David H. Williams

Real Estate: Zoning/Land Use

  • A. Kimberly Hoffman

Chambers & Partners is a highly respected and influential London-based research and publishing company that provides rankings of leading business lawyers and law firms throughout the world.  Rankings are based on technical legal ability, professional conduct, client service, commercial astuteness, diligence, commitment, and other qualities most valued by clients. 
 

Peter B. Ladig Joins Morris James LLP as a Partner in the Corporate and Fiduciary Litigation Group

Morris James LLP is pleased to announce Peter B. Ladig has joined the firm as of June 1, 2010.  The majority of Mr. Ladig’s practice is in the Delaware Court of Chancery, although he has extensive experience in the other state and federal courts in Delaware and has been involved in over 50 published decisions. 

David Williams, the firm’s managing partner stated “We are delighted Peter Ladig has joined the Firm as a partner in our Corporate/Commercial Litigation Group. Peter adds his considerable skill and experience to a talented Group. We continue to look for opportunities to grow our Firm by adding accomplished laterals, particularly in the IP practice.”   

Mr. Ladig has represented both stockholders and directors in litigation in the Court of Chancery in cases involving, among other things, advancement of legal fees and expenses, contested elections of directors, requests to inspect books and records and claims for breaches of fiduciary duties.  He has also represented corporations and other entities in commercial disputes involving breach of contract claims and claims arising under the General Corporation Law of the State of Delaware. 

Mr. Ladig has authored several articles pertaining to corporate and commercial litigation in Delaware and he is a frequent speaker before groups of professionals regarding Delaware laws affecting LLCs and other business entities.  Mr. Ladig graduated with distinction from Emory University School of Law and has been a member of the Delaware Bar since 1996.

Super Lawyers® Names 7 Morris James Partners As Top Legal Counsel in Delaware

Super Lawyers® magazine has named 7 Morris James partners as top legal counsel in Delaware.  The multiphase selection process is handled by Law & Politics who evaluates each candidate on 12 indicators of peer recognition and professional achievement. Selections are made on an annual, state-by-state basis and include only 5 percent of the licensed attorneys in a state.

Morris James’ 2010 nominations include:

David H. Williams - Employment & Labor, Government/Cities/Municipalities
P. Clarkson Collins, Jr. - Business Litigation, Business/Corporate, Mergers & Acquisitions
Richard Galperin - Personal Injury Defense: Medical Malpractice
Lewis H. Lazarus - Business Litigation
Edward M. McNally - Business Litigation, Business/Corporate
James W. Semple - Business Litigation, General Litigation, Insurance Coverage
Richard Herrmann – Intellectual Property Litigation
 

Hitler Explains Why RIM Matters

UPDATE: Now I'm ticked! The video below, and all other Hitler "Downfall" parodies, have been pulled from YouTube.  The removal comes per a takedown demand issued by the film's owner Constantin Films, claiming the videos infringed on the copyright. Boo! Hiss!

I am not an IP attorney, so this is not legal advice, but it seems to me that these videos are fair use of copyrighted material.  What's more, Constantin Films clearly does not understand social media—I added Downfall to my Netflix queue because of these parodies.  I otherwise never would have heard of the film.  Constantin Films: THESE VIDEOS ARE HELPING YOU! DUH.

Then again, this takedown dustup is creating even more publicity...hmmm...

 

ORIGINAL POST: Yesterday, on the e-Disclosure Information Project blog, Chris Dale's post Hitler and Cloud Computing Security gives us a super discovery-related entry in the crowded and growing "Hitler and..." series of spoofs.  I can't get enough of these videos and was giddy <!-- That's right, I said giddy.  I'm easily amused. --> to find a related gem on YouTube just days ago, in which Hitler laments the exclusion of records management from the discovery process.  Brilliant.

Disaggregation, Unbundling, and Document Review

I believe I found this video by way of Ryley Carlock's Litigation Unbundling Ramp in Legal OnRamp.  In it, Paul Ward briefly discusses the merits of "smart review"...

On Project Management and Redskins Fans

I wanted to finish the "The State of eDiscovery in Delaware series before moving on to other subjects, but I've found it difficult (there's so many meaty issues to discuss) and finally cracked.  Please indulge this short diversion.

First, a warm and fuzzy congratulations to Gabe Acevedo, author of Gabe's Guide to the e-Discovery Universe, for being invited to regularly contribute to the excellent EDD Update blog.  Do yourself a favor and take a look at Gabe's first contribution.  He'll be a great addition to EDD Update.  I love reading Gabe's posts for his creativity and humor.  (Want proof?  Take a look at the title of his post announcing the launch of this blog.)  Congrats Gabe!  [UPDATE: I forgot to mention, I first found Gabe on Twitter (@GabeAcevedo) where you can follow him too.  Also look for me on Twitter (@cspizzirri).]

Second reason for breaking the series: project management.  "Of course," you say, "what lawyer wouldn't be excited about project management?"  Well, only a few of us geeky types who like workflows and metric and statistics and whatnot, but that will change.  There's a growing recognition of the importance of incorporating project management and other related techniques into the eDiscovery process to help control costs and reduce risks.  (See The Sedona Conference® Commentary on Achieving Quality in the E-Discovery Process [related blog posts here and here] or EDRM's Evergreen/Project Management project.)

I began applying these techniques to our internal eDiscovery processes at Morris James several months ago and took up Six Sigma—with the guidance of a master black belt, mind you—more recently.  You can expect to read about this topic here often and in more depth, but, in the meantime, take a look at Paul Easton's Six Sigma as a Legal Project Management Tool, Part 1.  Project management, quality control, sampling, etc. have been percolating to the top of the eDiscovery discussions, but when I saw a post about EDD and Six Sigma, well, I just couldn't contain myself anymore.  Remember:

What you do not measure, you cannot control. -Tom Peters

We'll resume the regularly scheduled programming shortly.