No fishing poles in the office.

• Author: Slusarz, Joanna K.
• Position: Electronic discovery rule

EARLY settlement is usually encouraged by the courts and welcomed by parties involved in a lawsuit. (1) However, it may not always be the most favorable result for the defendant, the plaintiff, or the civil justice system in general, for example when the costs of continuing litigation in the pursuit of adjudication on the merits of the plaintiff's case and "clearing the defendant's name" outweigh those of early settlement. Settlement may provide "relatively foreseeable, fixed costs to the defendant in comparison to the potentially unknown and less limited costs of litigating numerous actions," (2) and avoids "the risk of compensatory and punitive damages awards at the end of a trial.... wear and tear on company personnel, and the overall impact of ongoing litigation on the company and the market." (3) But early settlement raises the risk of "'stir [ring] the pot' and encourag[ing] additional, low merit cases that might not otherwise have been filed had the company chosen to litigate existing lawsuits." (4) The phenomenon of electronic discovery (5) has exponentially increased the cost of litigation within a relatively short time frame. (6) As a result, defendants are often bullied into a corner and forced to settle prematurely or risk incurring additional, exorbitant expenses that go hand-in-hand with responding to a request calling for e-discovery. (7)

Entities of every size are affected by these counterproductive tactics. Small firms and businesses usually lack the resources and technologies required to store and retrieve their electronically stored information ("ESI") to efficiently respond to e-discovery requests. (8) Large corporations may fall prey to plaintiffs with dubious claims, (9) particularly when the plaintiffs are individuals or class action members (10) who have the clear advantage of a smaller, less complex "paper trail." (11) Undeserving parties may be unfairly rewarded on the defendants' preference to end matters at an earlier stage through settlement. (12) Conversely, "[d]eserving cases are not brought because the cost of pursuing them fails a rational cost-benefit test." (13) The pervasive acceptance of the practice of early settlement of often meritless claims and its frequent occurrence further perpetuate this unfavorable result as e-discovery continues to take on an increasingly prominent role in contemporary civil litigation. (14)

Practitioners have minimal guidance on where to set limits, and responding to an e-discovery request has been dubbed a "fishing expedition" (15) and "mining data." (16) The 2006 Amendments to the Federal Rules of Civil Procedure (17) ("FRCP") attempted to appease the various interests involved in litigation, but do not go nearly far enough (18) due to the Rules' preference for "'liberal discovery' that the producing party must pay for itself and a broad relevance standard--that discoverable evidence need not be admissible, only 'reasonably calculated to lead to the discovery of admissible evidence.'" (19) Although they yield themselves better to certain types of cases, (20) the amended Rules are difficult to apply efficiently to others, (21) leading one commentator to conclude that "[o]ne set of rules cannot accommodate all cases." (22) The FRCP are also binding only in the federal court system, and though some states (23) have enacted e-discovery provisions in their civil rules, the majority of states have not. (24) While some states are waiting and monitoring others' experiences with the amended FRCP, (25) others appear to have no plans to adapt the FRCP or devise their own e-discovery rules. (26) Federal local rules exacerbate these problems because they vary by jurisdiction. (27)

Recent cases have helped to fill in practical loopholes left behind by the FRCP. Still, "[n]ot qualifying as 'final' orders, discovery rulings ordinarily are nonappealable, so few trial court decisions regarding the scope and logistics of discovery reach the appellate level." (28) Even Zubulake v. UBS Warburg, (29) "though 'widely regarded as the leading case authority' on e-discovery," is a "nonbinding district court precedent" and along with almost every e-discovery opinion, has not been universally followed. (30) Because few e-discovery decisions get published, "'any ruling could be a trend.'" (31) Perhaps the greatest criticism of these rulings is that courts, in deciding discovery disputes, "rarely say anything about case merits." If they do mention the merits, it is merely to "disclaim any consideration of the merits." (32) In Carrizosa v. Stassinos, the court determined that the discovery motion at issue "[did] not turn on the merits," (33) and the court in Maher v. Monahan announced that "[plaintiffs] are not required to establish a legally sufficient case ... as a condition of securing discovery." (34)

Numerous think-tank organizations (35) seek to provide guidance with the daunting problem of e-discovery. Their solutions are merely suggestions that have no precedential value for courts or parties. (36) Further, these strategies, "do not aim for a paradigm shift, instead relying on status-quo methods to limit discovery." (37)

"[T]here's waste and inefficiency in e-discovery, largely driven by fear and ignorance," (38) and the current situation seems hopeless. (39) This article provides a background to the drivers of the e-discovery crisis, and the expanding case law that has developed to address it, and proposes that clear, uniform and binding guidelines that reflect and respond to the e-discovery experiences of practitioners, the judiciary, and other major players in civil litigation be developed to tackle the ever-evolving phenomenon of electronic discovery.

1. The Problem

   1. The Scope of E-discovery--What Isn't E-discovery?

      E-discovery is "the process of identifying, collecting, filtering, searching, de-duplicating, reviewing and potentially producing ESI that relates to pending or reasonably anticipated litigation...." (40) The 2006 Amendments to the FRCP define ESI as "writings, drawings, graphs, charts, photographs, sound recordings, images, and other data or data compilations." (41) In practice, the list of frequently requested data expands exponentially to include "'databases, spreadsheets, word processing documents, emails, instant messages, voicemail and other recordings, web pages, images, metadata about documents, document backup tapes, erased but still recoverable documents, and everything else attorneys can think of that might help explain the circumstances on which the lawsuit is based." (42) ESI can also be found on "website log files, cookies and cache files.... hard drives, floppy disks, CDs, DVDs, magnetic tapes, personal digital assistants, cell phones, logs, websites, [and] memory sticks." (43)

      As lengthy as this list is, it is far from fully inclusive. (44) There are many places and devices that may contain company information in various formats, most of it electronic. (45) Though much of this data is reasonably accessible, "vast quantities of the data are also preserved in sources that are not reasonably accessible, such as back-up storage media used for disaster recovery." (46) Files that have been supposedly "deleted" may still be recovered until overwritten. (47) Many ESI storing devices are also portable and thus can be easily transported outside of the physical boundaries of the office. In addition, a large amount of ESI contains "metadata" which is "information about a particular data set or document that describes how, when and by whom it was collected, created, accessed, modified and formatted (48) and in some instances has been more helpful than the actual document itself to attorneys who used it to "'piece together the chronology of events.'" (49)

   2. The Effect of the Exponential Growth of E-Discovery

      "[I]n federal cases, discovery comprises half of all litigation costs; in the most expensive 5 percent of cases, discovery amounts to 90 percent of litigation cost and totals 32 percent of the amount in controversy." (50) Additionally, less than two percent of cases filed actually go to trial. (51) As a result, discovery "has become an end in itself," leading The American College of Trial Lawyers Task Force on Discovery to conclude that "[t]he discovery system is. ... broken" and to point fingers directly at e-discovery. (52)

      The growth of e-discovery in contemporary civil litigation has defied all predictions:

      Both the types of available data storage media and amount of storage available continue to expand unabated under Moore's law. It would be natural to think that the growth is about to level off, but nothing could be further from the truth. Predictions from [electronic storage and production] equipment manufacturers suggest that the amount of digital information will continue to grow at an exponential rate for as long as we can imagine. (53) Electronic mail is a particularly important type of ESI. Not only does email and its attachments contain 60-70% of all corporate data, (54) but "the email of [litigation] participants captures the contemporaneous facts of what happened and why in a way that was unimaginable back in the days of typewriters and phones." (55) The Radicati Group "estimate[d] that corporate e-mail traffic per user has increased at a rate of 33% per year and projections are that worldwide traffic in 2006 was at the rate of 183 billion messages per day." (56) The Radicati Group also found that the average size of email messages has grown, resulting in an increase in bandwidth storage requirements per user. (57) Addionally, instant messages may surpass e-mails traffic in the near future (58) as reports reveal that twelve billion instant messages are sent daily worldwide. (59) Reviewing this volume of data for privilege quickly becomes extraordinarily costly. In Rowe Entertainment v. The William Morris Agency, for example, the cost of satisfying a single request for e-mails found on backup tapes was estimated...