Archive for February 2016

For the First Time, English Court Approves Use of Predictive Coding

Pyrrho Investments Ltd v MWB Property Ltd [2016] EWHC 256 (Ch)

On February 2, 2016 an English court approved the use of predictive coding for the first time. Thereafter, it issued an opinion explaining the reasons for approval, relying in part upon the well-known Da Silva Moore case, which was the first to approve the use of predictive coding in American litigation.

Following extensive discussion of the issue, including acknowledging the parties’ agreement to utilize predictive coding in this case, the court laid out the factors it considered in favor of approving the use of predictive coding, noting “there were no factors of any weight pointing in the opposite direction”:


33.     In the present case, the factors in favour of approving the use of predictive coding technology in the disclosure process seemed to me to be these:

(1)     Experience in other jurisdictions, whilst so far limited, has been that predictive coding software can be useful in appropriate cases.

(2)     There is no evidence to show that the use of predictive coding software leads to less accurate disclosure being given than, say, manual review alone or keyword searches and manual review combined, and indeed there is some evidence (referred to in the US and Irish cases to which I referred above) to the contrary.

(3)     Moreover,  there will be greater consistency in using the computer to apply the approach of a senior lawyer towards the initial sample (as refined) to the whole document set, than in using dozens, perhaps hundreds, of lower-grade fee-earners, each seeking independently to apply the relevant criteria in relation to individual documents.

(4)     There is nothing in the CPR or Practice Directions to prohibit the use of such software.

(5)     The number of electronic documents which must be considered for relevance and possible disclosure in the present case is huge, over 3 million.

(6)     The cost of manually searching these documents would be enormous, amounting to several million pounds at least. In my judgment, therefore, a full manual review of each document would be “unreasonable” within paragraph 25 of Practice Direction B to Part 31, at least where a suitable automated alternative exists at lower cost.

(7)     The costs of using predictive coding software would depend on various factors, including importantly whether the number of documents is reduced by keyword searches, but the estimates given in this case vary between £181,988 plus monthly hosting costs of £15,717, to £469,049 plus monthly hosting costs of £20,820. This is obviously far less expensive than the full manual alternative, though of course there may be additional costs if manual reviews still need to be carried out when the software has done its best.

(8)     The ‘value’ of the claims made in this litigation is in the tens of millions of pounds. In my judgment the estimated costs of using the software are proportionate.

(9)     The trial in the present case is not until June 2017, so there would be plenty of time to consider other disclosure methods if for any reason the predictive software route turned out to be unsatisfactory.

(10)    The parties have agreed on the use of software, and also how to use it, subject only to the approval of the Court.

There were no factors of any weight pointing in the opposite direction.

34.     Accordingly, I considered that the present was a suitable case in which to use, and that it would promote the overriding objective set out in Part 1 of the CPR if I approved the use of, predictive coding software, and I therefore did so. Whether it would be right for approval to be given in other cases will, of course, depend upon the particular circumstances obtaining in them.

A full copy of the court’s opinion is available here.

Court Declines to Compel Production of All Documents Identified by Agreed-Upon Search Terms

Gardner v. Continental Cas. Co., 3:13 CV 1918 (JBA), 2016 WL 155002 (D. Conn. Jan. 1, 2016)

Plaintiffs sought to compel production of all 38,000 documents hit by agreed-upon search terms.  Following review for relevance and privilege, Defendant produced only 2,214 pages “of which 274 pages consisted of copies of the complaints, with exhibits, filed in this lawsuit.” The court declined to compel the production of all search hits, but acknowledged concerns regarding Defendant’s production based on documents produced by a third party.  Accordingly, the court ordered the parties to confer regarding variations of “sampling and iterative refinement” or “a quick peek protocol” of the documents hit by search terms and also indicated willingness to consider appointment of a Special Master to conduct a review of the documents at the expense of the parties.

The parties in this case disagreed over the production of documents identified by agreed-upon search hits. Plaintiffs argued that Defendant “cherry-picked” documents for production and that the reason for agreed-upon search terms was “to avoid prolonged and detailed debate over what ESI documents are ‘responsive’ . . . .” Plaintiffs further supported their concerns regarding the completeness of Defendant’s production by noting that the production from Defendant’s third-party claims administrator was “far more comprehensive and informative.”  Defendant, in turn, argued that it had already provided “extensive discovery” and that it spent “significant resources” reviewing the documents identified by the search terms prior to production.

The court found Plaintiffs’ position “untenable,” concluding that “defendant is not obligated to turn over all 38,000 documents, after a review eliminates some on the basis of privilege.”  The court reasoned: “As every law school student and law school graduate knows, when performing a computer search on WESTLAW and/or LEXIS, not every case responsive to a search command will prove to be relevant to the legal issues for which the research was performed. Searching tens of thousands, and hundreds of thousands, of electronic documents is no different.” Recognizing “plaintiffs’ legitimate concern” regarding the production, however, the court ordered counsel to confer regarding two approaches for addressing the search hits—“sampling and iterative refinement” or a “quick peek protocol”—and indicated in footnote its willingness to consider the appointment of a Special Master to review the documents at the parties’ expense if no agreement could be reached. The court also ordered production of several documents for in camera review to determine if redactions were appropriate.

A full copy of the court’s order is available here.

Citing Newly-Amended Rule 37(e), Court Vacates Prior Order Imposing Adverse Inference

Nuvasive, Inc. v. Madsen Med. Inc., No. 13cv2077 BTM(RBB), 2016 WL 305096 (S.D. Cal. Jan. 26, 2016)

In this case, the court granted Plaintiff’s motion to reconsider a prior order imposing an adverse inference for Plaintiff’s failure to preserve text messages, in light of new standards imposed under recently amended Federal Rule of Civil Procedure 37(e).

Plaintiff sought to vacate the court’s prior order imposing an adverse inference for the loss of text messages, citing recent amendments to Fed. R. Civ. P. 37(e).  Specifically, the rule now permits an adverse inference for failure to preserve ESI “only upon finding that the [spoliating] party acted with the intent to deprive another party of the information’s use in the ligation.” Citing the relevant language of the new rule and the instruction provided in the Committee Notes, the court concluded that “it would not be proper for the Court to give the adverse instruction” where the court previously found that “[Plaintiff] was at fault for not enforcing compliance with the litigation hold” but made no finding that the failure to preserve was intentional and where “[t]he record does not support a finding of intentional spoliation by [Plaintiff].”

Regarding application of the new rule to a prior order, the court acknowledged that “’[g]enerally a new procedural rule applies to the uncompleted portions of suits pending when the rule became effective . . . .’” (citation omitted) and reasoned that although the rule was not in effect at the time of its prior ruling, the court had not yet given the adverse inference, because trial had not taken place.  The court therefore concluded that “the new rule applies to the trial proceedings.”

Defendants argued, among other things, that it was “neither ‘just’ nor ‘practicable’ to apply the new rule” because “application of the amended rule would cause substantial prejudice to [Defendant], which took discovery and filed its spoliation motion under the standard applicable at the time.” Rejecting that argument, the court noted that even under the prior standard intent was relevant, reasoning that “the importance of intent, if it can be proved, is not new” and that “Defendants probably did not ask the witnesses whether they intentionally destroyed the text messages because in all likelihood, they would have denied it.”

Finally, addressing Defendants’ claim that no alternative sanction could remedy the prejudice they suffered, the court reasoned that it was “not accurate to say that Defendants have no remedy or recourse” citing the Committee Notes which explain that the new rule “would not prohibit a court from allowing the parties to present evidence to the jury concerning the loss and likely relevance of information and instructing the jury that it may consider that evidence, along with all the other evidence in the case, in making its decision.”

Accordingly, the court indicated that it would allow Plaintiff and Defendants to “to present evidence to the jury regarding the loss of electronically stored information and will instruct the jury that the jury may consider such evidence along with all other evidence in the case in making its decision.”  Notably, the court had previously indicated that both parties would be allowed to present evidence of the other side’s failure to preserve, where Plaintiff had also alleged spoliation against Defendants, but could not establish that it was entitled to an adverse inference (under the pre-amendment standard).

A copy of the court’s full order is available here.