Friday, December 01, 2006

E-discovery amendments to FRCvP Effective Today

Not what ABL wanted for Christmas, but it will do. Actually, ABL would like to see the Rules Committee take some action on his proposal to amend Rule 4 (

In any event, these amendments will have a great impact on businesses, especially small and mid-sized business. Defendants tend to prefer federal court, but I think that the new ESI regime may compel business to prefer state court when they have the option. Large business (i.e. perpetual litigants) must ensure that record retention policies are reviewed and updated if necessary. ABL will discuss various aspects of the ESI ("electronically stored information") amendments in future posts.

The first change that jumps out at ABL is FRCvP 37(f):

Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide [ESI] lost as a result of the routine, good-faith operation of an electronic information system." Sounds goods, but the ambiguity scares the hell out of ABL. What are "exceptional circumstances"? Although it sounds like a sufficiently high standard, it remains to be seen how it will be applied. Moreover, this suggests that there ARE circumstances in which a party MAY be sanctioned for routine, good-faith operation of the EI system.

Lawyer: Did I mention that the judge sanctioned your company?

Client: For what?

Lawyer: Your company copied over old back-up tapes during routine course of business and deleted old e-mails under its document retention policy.

Client: But that is the document retention policy that your firm drafted for my company!

Lawyer: I know, but the judge found that "exceptional circumstances" existed. What can I say, you win some, you lose some.

Client: Well, a lot of good that does me. What should I do to avoid future "exceptional circumstances" sanctions?

Lawyer: You could save everything, storage is relatively inexpensive.

Client: But do you know how many electronic documents the company generates in a year? We will have to purchase ten new servers a year to store the stuff that we no longer need.

Lawyer: Did I mention that our firm sells servers too?


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