Archive for August 2016

Statements of Information Withheld Comply with Amended Rule 34, Motion to Compel Denied

Rowan v. Sunflower Elec. Power Corp., No. 15-cv-9227-JWL-TJJ, 2016 WL 3743102 (D. Kan. July 13, 2016)

In this case, the court addressed, among other things, the sufficiency of Defendant’s objections to Plaintiff’s Requests for Production and in particular its compliance with the new requirements of amended Fed. R. Civ. P. 34, effective as of December 1, 2015. Upon review of the objections and Defendant’s statements of information witheld (as expressed by Defendant’s identification of its search parameters), the court concluded that Defendant’s responses were sufficient and counseled Plaintiff to make additional inquiries in future discovery to the extent he desired additional information.

Effective December 1, 2015, Fed. R. Civ. P. 34(b)(2)(C) was amended to require that objections to Requests for Production include a statement indicating “whether any responsive materials are being witheld on the basis of that objection.” Per the Advisory Committee’s note, “An objection that states the limits that have controlled the search for responsive and relevant materials qualifies as a statement that the materials have been ‘witheld.’”

In the present case, Plaintiff challenged the sufficiency of Defendant’s objections and in particular its statements regarding information witheld. The court addressed four examples in its opinion:

  1. Where Defendant responded to certain RFPs by objecting and stating that “[Defendant] has limited its search to the e-mail.PST files for project management for the subject project, and has produced all non-privileged e-mails and attachments identified therein relating to the subject project,” the court found that the response complied with Rule 34(b)(2)(C).
  2. Where Defendant responded to requests for “documents reflecting [Defendant’s] bid analyses of subcontractors who submitted bids for the project” by stating in relevant part that “it limited its search for responsive documents to all bid proposals [Defendant] received for the project dated July 25 and November 1, 2013, and to the evaluation and recommendation letters submitted for those bid proposals,” the court again found that the response complied with Rule 34(b)(2)(C).
  3. Where Defendant responded to a request seeking “all documents reflecting an investigation of the incident surrounding Plaintiff’s injuries” with a statement “that it limited its search to OSHA’s investigation, its own investigation report, Track’s investigation report, and email .PST files for project management for the subject project,” the court found that “[u]nder Rule 34, [Defendant] ha[d] provided a sufficient response.”
  4. Where Defendant responded to a “very broad request” seeking “any documents” regarding internal meetings related to specified topics by objecting to the overbroad nature of the request and stating that it “limited its search to the email .PST files for project management for the project,” the court found that the response complied with Rule 34.

Accordingly, the court denied Plaintiff’s Motion to Compel.

A full copy of the court’s Memorandum and Order is available here.

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Use of Predictive Coding was “Reasonable Inquiry,” Motion to Compel Additional Discovery Denied

Dynamo Holdings Ltd. P’ship v. Comm’r of Internal Revenue, No. 2685-11, 8393-12, 2016 WL 4204067 (T.C. July 13, 2016)

In September 2014, the court approved Petitioners’ use of predictive coding to identify potentially responsive and privileged data contained on two backup tapes, despite Respondent’s objection that the technology was “unproven.” (Read a summary of that opinion here.)  At that time, the court indicated that Respondent could move to compel additional discovery in the event he believed that Petitioners’ response was insufficient.   Accordingly, after Petitioners denied Respondent’s request for production of additional documents containing certain specified search hits, Respondent moved to compel.  Concluding that Petitioners’ reliance on predictive coding satisfied the requirement for a “reasonable inquiry,” the court denied the motion.

Over Respondent’s objection, the court approved Petitioners’ use of predictive coding to identify responsive materials. Thereafter, the parties worked together to craft a predictive coding protocol, with the court stepping in to resolve areas of disagreement.  Upon completion of the process, Petitioners “delivered a production set of approximately 180,000 total documents” for Respondent’s review, 5,796 of which he retained and returned the rest to Petitioners.  In June 2016, Respondent filed his motion to compel, seeking production of documents identified by specified terms which were not previously produced.

Following an informative discussion of “recall versus precision” (two important concepts in predictive coding), the court indicated it would “assume” (as Respondent had argued) that the predictive coding response was “flawed” (because the level of recall was too low) and turned to the question of whether relief should therefore be afforded.

The court began its analysis with the premise that “Respondent’s motion [was] predicated on two myths”: the “myth of human review” and the “myth of a perfect response.” The “myth of human review” (per the court, citing the Sedona Conference) is the idea that manual review by humans “constitutes the gold standard by which all searches should be measured.”  The “myth of a perfect response”—perhaps more obvious on its face—is the idea that a discovery response should be perfect.  Regarding the first “myth,” the court cited a 2012 report from RAND Corp. establishing that “human review is far from perfect” where humans frequently disagree regarding what constitutes a  responsive document.  Regarding the second “myth” the court made clear that the Tax Court Rules (and the Federal Rules of Civil Procedure) “do not require a perfect response,” but rather “require that the responding party make a ‘reasonable inquiry’ before submitting the response.” Moreover, the court reasoned that “[t[he fact that a responding party uses predictive coding to respond to a request for production does not change the standard for measuring the completeness of the response.”

Accordingly, the court concluded:

There is no question that petitioners satisfied our Rules when they responded using predictive coding. Petitioners provided the Commissioner with seed sets of documents from the backup tapes, and the Commissioner determined which documents were relevant. That selection was used to develop the predictive coding algorithm. After the predictive coding algorithm was applied to the backup tapes, petitioners provided the Commissioner with the production set. Thus, it is clear that petitioners satisfied our Rules with their response. Petitioners made a reasonable inquiry in responding to the Commissioner’s discovery demands when they used predictive coding to produce any documents that the algorithm determined was responsive, and petitioners’ response was complete when they produced those documents.

Respondent’s motion was denied.

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

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A Responding Party Cannot be Forced to Use Technology Assisted Review (Predictive Coding)

Hyles v. New York City, 10 Civ. 3119 (AT)(AJP) (S.D.N.Y. Aug. 1, 2016)

In this case, the court addressed the question of whether the City could be “forced” to use technology assisted review (predictive coding) to identify discoverable information when the City itself preferred to use keyword searching. “The short answer [was] a decisive ‘NO.’”

After consulting with an e-discovery vendor, Plaintiff’s counsel in this case “proposed that the City should use TAR as a ‘more cost-effective and efficient method of obtaining ESI from Defendants.’” “The City declined, both because of cost and concerns that the parties, based on their history of scope negotiations, would not be able to collaborate to develop the seed set for a TAR process.”  The issue was referred to Magistrate Judge Andrew Peck for resolution.

Despite acknowledging the truth of Plaintiff’s assertions that in general “TAR is cheaper, more efficient and superior to keyword searching,” and that “parties should cooperate in discovery,” the court ultimately concluded that the “[c]ooperation principles … do not give the requesting party, or the Court, the power to force cooperation or to force the responding party to use TAR.” Further, the court indicated its support for Sedona Principle 6, which provides that “[r]esponding parties are best situated to evaluate the procedures, methodologies, and technologies appropriate for preserving and producing their own electronically stored information” and also counseled that while Plaintiff “may well be correct that production using keywords may not be as complete as it would be if TAR were used, the standard is not perfection, or using the ‘best’ tool, but whether the search results are reasonable and proportional.” (Citations omitted.)

Accordingly, the court concluded:

To be clear, the Court believes that for most cases today, TAR is the best and most efficient search tool. That is particularly so, according to research studies (cited in Rio Tinto), where the TAR methodology uses continuous active learning (“CAL”), which eliminates issues about the seed set and stabilizing the TAR tool.  The Court would have liked the City to use TAR in this case.  But the Court cannot, and will not, force the City to do so.  There may come a time when TAR is so widely used that it might be unreasonable for a party to decline to use TAR.  We are not there yet.  Thus, despite what the Court might want a responding party to do, Sedona Principle 6 controls. Hyles’ application to force the City to use TAR is DENIED.”

However, the court’s opinion did indicate that if Plaintiff “later demonstrates deficiencies in the City’s production, the City may have to re-do its search.”

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

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Reliance on Caselaw Analyzing Prior Version of Rule 26 “Inexplicable” and “Inexcusable,” Sanctions Imposed

Fulton v. Livingston Fin., LLC, No. C15-0574JLR, 2016 WL 3976558 (W.D. Wash. July 25, 2016)

In this opinion, the court imposed sanctions for counsel’s misrepresentations of law and fact, including his citation to caselaw analyzing outdated standards under Fed. R. Civ. P. 26(b)(1), which was substantially affected by the December 2015 amendments. Calling counsel’s reliance on caselaw applying outdated standards “inexplicable” and “inexcusable” where the “December 1, 2015 amendments to Federal Rule of Civil Procedure 26(b)(1) ‘dramatically changed’ what information is discoverable,” the court ultimately imposed monetary sanctions (payment of Plaintiff’s fees and costs for defending the at-issue motion) and ordered counsel to supply “senior members” of his firm with the “offending brief” with the explanation that “the court is entering sanctions . . . for quoting provisions of the civil rules that are badly out of date, and also making direct misrepresentations to the court.”  Declining to also require the attorney to report the sanction on future pro hac vice applications, the court did order that if a federal court threatened or imposed sanctions on the attorney at any time in the next five years, the attorney must “immediately disclose to that court the sanctions imposed by this court by providing that court with a copy of this order and the offending briefing.”

As illustrated by this opinion, the importance of reviewing, understanding, and applying the appropriate standards under the newly-amended rules cannot be overstated. To that end, please note that the rules affected by the December 1, 2015 amendments are: 1, 4, 16, 26, 30, 31, 33, 34, 37, 55, 84 & the Appendix of Forms.  The current rules and their informative Committee Notes are available here: http://www.uscourts.gov/rules-policies/current-rules-practice-procedure/federal-rules-civil-procedure

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

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