The new electronic discovery rules: a place for employee privacy?

• Author: Kim, Elaine Ki Jin

In 2002, the world's computer users generated approximately five exabytes of data, the informational equivalent of a half a million libraries the size of the Library of Congress. Ninety-two percent of that new information was stored magnetically. (1) Since then, our appetite for electronic information, and for hardware that can store greater amounts of it, has grown exponentially.

The law has struggled to keep pace with the proliferation and stockpiling of electronic data. In particular, this trend has placed severe strains on the existing framework for discovery, prompting the Civil Rules Advisory Committee of the U.S. Judicial Conference to recommend amendments to the Federal Rules of Civil Procedure. As the Advisory Committee has acknowledged, the traditional paper rules cannot simply be stretched to deal with unprecedented problems such as the automatic creation of metadata, the retrieval of "deleted" data, and, most urgently, the sheer volume of electronic information. (2)

A package of proposed amendments on electronic discovery, or "e-discovery," has recently been approved by the Judicial conference and now awaits consideration by the U.S. Supreme Court. Although the amendment process appears to be in the final stages, it will be some time before the new rules go into effect. (3) Meanwhile, courts continue to formulate their own e-discovery rules. One recent case, Zubulake v. UBS Warburg LLC, (4) has intensified corporations' anxiety about their e-discovery obligations. In this employment discrimination case, the district court treated data stored on magnetic backup tapes as broadly discoverable, eventually instructing the jury that it could infer bad faith on the part of the corporation for its e-discovery failures. (5)

While Zubulake and recent commentary on e-discovery have emphasized balancing the interests of the litigants, this Comment shifts the focus to the collateral effects that e-discovery may have on everyday employment relations. Specifically, this Comment contends that the e-discovery framework offered by Zubulake increases incentives for employers to implement intrusive forms of electronic surveillance. While the Judicial Conference's proposed rules may reduce these incentives indirectly by easing the discovery burdens on employers, courts applying the new rules can and should engage the issue of employee privacy directly. This Comment suggests how courts can shape e-discovery procedures to discourage the abuse of surveillance technologies and protect privacy in the workplace.

1. THE ZUBULAKE STANDARD

   In Zubulake, a former employee sued UBS Warburg for gender discrimination and illegal retaliation. During the discovery phase, the plaintiff requested "[a]ll documents concerning any communication by or between UBS employees concerning Plaintiff," including internal e-mails stored on the firm's active and archived media. (6) The court took the discoverability of the disaster recovery tapes as given, (7) but ordered a sample restoration office tapes to assess the cost of producing all the relevant data. It was only later, when ruling on UBS's cost-shifting motion, that the court gave special consideration to the inaccessible nature of the requested information. (8) As part of a multifactor cost-shifting test, the court analyzed whether the plaintiffs request for inaccessible data was specifically tailored to discover relevant information and whether the information was available from more accessible sources. (9) Evaluating sixty-eight e-mails from the sample production that the plaintiff had pinpointed as "highly relevant to the issues," the court concluded that the sample restoration sufficiently "demonstrated that Zubulake's discovery request was narrowly tailored," (10) while admitting that it was "speculative" that the backup tapes contained the smoking-gun email that Zubulake sought. (11) The court eventually ordered UBS to restore and produce the remaining tapes and to bear seventy-five percent of the production costs. (12)

   In subsequent rulings in the case, the court turned its attention to whether UBS had committed spoliation--the destruction of discoverable evidence. Restoration of the backup tapes revealed that key players had deleted relevant e-mails from their computers after the lawsuit was filed. Furthermore, UBS had recycled some tapes in violation of its retention policy, and UBS's counsel had failed to inform two employees to turn over responsive e-mails stored in their active files. (13) Although the corporation's failures were arguably only negligent, (14) the court found that the employees' deletions of e-mails had been willful and granted the plaintiff's motion for an adverse inference instruction to the jury. (15) Ultimately, the jury awarded the plaintiff $9.1 million in compensatory damages and $20.1 million in punitive damages. (16)

2. ZUBULAKE AND EMPLOYEE PRIVACY

   Zubulake has had an impact far beyond the Southern District of New York, influencing courts in other jurisdictions (17) and alarming corporations (and their counsel) across the country. (18) Zubulake poignantly demonstrates that a court can order the production of old disaster recovery tapes even if no one knows exactly what they contain. Given the broad relevance standard of the Federal Rules, the scope of discoverable...