Wortzman Nickle at the Osgoode Short Course on Obtaining, Producing and Presenting Electronic Evidence
This year, Wortzman Nickle presented on three separate topics at the Osgoode course on Electronic Evidence, held in Toronto on January 24th and 25th.
Chuck Rothman and Karen Groulx of Pallett Valo LLP presented the “Admissibility of Electronic Evidence”. The unique properties of digital information compared to its paper counterpart were explored, and the speakers emphasized that admissibility needs to be considered from the start – a misunderstanding regarding the process that created the electronically stored information may ultimately render the information inadmissible.
Chuck and Karen also discussed social networks and cloud computing, and how they may impact electronic discovery. The growth of social networking in the corporate environment is becoming exponential – when was the last time you saw an ad that didn’t ask you to visit the company’s Facebook page? The use of cloud computing is also growing at a substantial rate, with some predictions suggesting that most electronically stored information will be stored “in the cloud” in ten years. Although these technologies will change how electronic discovery is conducted, the basic tenants will remain the same – electronic discovery is still discovery, with the same legal considerations. Only the techniques are different.
Susan Wortzman and Susan Nickle explored “Obtaining Relevant Electronic Evidence”, with a focus on how to defensibly obtain such information first from one’s own client, and then from opposing parties. One of the key issues raised by lawyers in the audience was how to properly cooperate with opposing counsel when he/she refuses to participate in the discovery plan/meet and confer process. While this lack of collaboration (regrettably) continues to be a problem, there are ways to protect your own client. In such circumstances, Susan Wortzman recommends drafting your own client’s discovery plan and sending it to the other side. By failing to respond, counsel may tacitly approve the plan.
As conference season is now in full swing, you can expect to see reports from a number of pending conferences, including Legal Tech New York 2011, in the coming weeks.
Justice Paul Grimm has released his decision in Victor Stanley II, confirming that severe spoliation sanctions are escalating in the United States.
In this unfair competition action, the defendant’s president, Mark Pappas, was accused of destroying (directly and indirectly) thousands of emails relevant to the case and of intentionally deleting relevant electronically stored information from his computer the night prior to its discovery. For good measure, Pappas also ran ‘”defragging” software. He alleged that the emails had been moved to a deleted items folder for “storage purposes”. The court rejected his story, calling Pappas’ conduct “clearly contemptuous”.
The court entered a permanent injunction and default judgment regarding the liability against the defendant with respect to the plaintiff’s copyright claim. However, the balance of the claims were permitted to proceed, as the court held the plaintiff had yet to prove irreparable or substantial prejudice.
The plaintiff was held to be entitled to its legal fees and costs related to the spoliation, violations of court orders relating to discovery, and the plaintiff’s seeking of sanctions. As a result, Pappas was ordered to “be imprisoned for a period not to exceed two years, unless and until he pays to the plaintiff the attorney’s fees and costs that will be awarded.” These costs were substantial at $1,049,850.04.
This must-read case will be to 2011 what the Pension Committee case was to 2010. Of particular interest is the 12 page chart drafted by the court that provides spoliation sanctions by court circuit to assist counsel in avoiding similar results. It’s only the third week of January. Stay tuned.
In the U.S., many lawyers are calling 2010 “the year of e-discovery sanctions”. There were more sanctions and parties cited for failing to adequately respond to e-discovery requests than in any previous year. The costs associated with e-discovery are also growing at an exponential rate. As a result, corporate counsel are starting to realise that the costs and risks associated with scrambling to locate and organize e-discovery evidence after litigation strikes are just too high.
In Canada, things are not (yet) as daunting as in the U.S. Canadian courts are opting to be more proactive, changing rules and adopting the Sedona Canada Principles to direct counsel down the right e-discovery path from the outset. However, the courts are making it clear that they will not tolerate parties who fail to properly address e-discovery processes.
So what’s the solution? According to a Forbes report, e-discovery needs to treated as a standard business process, like legal, corporate governance, HR, and IT, and not as a project that is kicked off on an as-needed basis.
As we emerge from the most recent recession with its associated financial restraints, this idea may sound too expensive to deal with at the moment. However, as the Forbes article suggests, companies should see this it as an opportunity to introduce cost savings into the organization, by changing the current corporate culture so that employees understand how their role is governed by and influences e-discovery requirements.
A side effect of this corporate wide ESI management revolution is that IT will end up spending much less time and money managing digital information, and employees will see a dramatic reduction in the time it takes to find the information they need to do their job. The cost savings from this alone will more than offset any expense due to corporate training and auditing.
In 2011, transform your corporation’s e-discovery approach from a tactical search and rescue mission into a strategic business function.