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BigLaw: Civ Pro 2.0: Think Before You Stipulate: The Perils of Being Too Agreeable Too Soon

By Kimberlee Gunning | Monday, July 5, 2010

BigLaw-06-28-10-450

Originally published on June 28, 2010 in our free BigLaw newsletter.

The Federal Rule of Civil Procedure Rule 26(f) conference, which requires litigants in federal court to meet and confer regarding a discovery plan, has the potential to be enormously useful. Instead of making up discovery strategy as you go along — which never, ever happens, does it? — you have a duty under FRCP 26(f)(3) to discuss both the subject of discovery and how to conduct it.

Often ignored by the parties is the rule's requirement to discuss, and include in the written discovery plan submitted to the court, "any issues about disclosure or discovery of electronically stored information, including the form or forms in which it should be produced." Fed. R. Civ. P. 26(f)(3)(C).

What often results is a generic stipulation in which the parties appear to agree on an eDiscovery protocol, but actually agree on nothing but their mutual desire to avoid any discussion of eDiscovery. Or worse, the resulting stipulation describes a protocol for discovery of electronic information that proves unworkable and frustrating.

The Court Will Hold You to Your eDiscovery Agreement, Even If You Shoot Yourself in the Foot

The emerging eDiscovery case law indicates that courts will likely enforce the terms of a stipulation, even if doing so would unduly burden or prejudice one party — even if the rules were amended since the parties entered into the agreement.

In In re ATM Fee Antitrust Litig., 2007 WL 1827635 (N.D. Cal. June 25, 2007), for example, the parties agreed at the onset of litigation to produce electronic documents as searchable TIFF files. The plaintiff later moved to compel the defendants to comply with the then-newly-amended Rule 34, which requires electronically stored information to be produced in "a form or forms in which it is ordinarily maintained or in a reasonably useable form or forms." Notwithstanding the language of Rule 34, the federal district court declined to "abdicat[e]...the parties' agreement" regarding the form of production. Indeed, Rule 34 itself makes clear that the stated procedure for production of electronically stored information applies "[u]nless otherwise stipulated or ordered by the court[.]"

More recent opinions follow this trend of enforcing stipulated eDiscovery protocols. In In re Fannie Mae Sec. Litig., 552 F.3d 814 (D.C. Cir. 2009), the D.C. Circuit affirmed the district court's order giving the defendants sole discretion to determine the search terms used to search a third party's off-site backup tapes for responsive documents. The third party, the Office of Federal Housing Enterprise Oversight ("OFHEO") had been served with a third-party subpoena. After OFHEO's initial production, the defendants learned that OFHEO did not search its off-site backup tapes. OFHEO volunteered to do so, and entered into a stipulated order providing the defendants "will specify the search terms to be used."

OFHEO was not pleased when it learned defendants' search terms resulted in over 600,000 documents. Its efforts to comply with production of responsive documents ultimately resulted in the agency spending over 9 percent of its total budget on the project. In response to OFHEO's request for relief, the district court held OFHEO must produce all responsive documents, finding the stipulation's language was clear and provided defendants with sole discretion over search terms, and thus, over the scope of the production. Ouch.

Rules of the Road for eDiscovery Stipulations

So, what can you do when faced with the need to agree on eDiscovery protocol early in the litigation? Keep these three principles to keep in mind.
  1. Don't agree to limits on the production format for electronically stored information. Preserve your right to obtain copies of electronically stored information in its native format. You may end up deciding later that TIFF files are acceptable, but make that call later, after you've familiarized yourself with the issues in the case and the types of electronic information in the other parties' possession.

  2. Don't agree to let the other party dictate search terms. The better practice is to stipulate to a procedure in which the requesting party submits a list of search terms with its discovery requests. The producing party is then free to object, after which the parties can take any disputes to the court if necessary.

  3. Don't agree to limits on the sources of electronic information to be searched by the other parties. Opposing counsel's idea of which employees' hard drives and which backup tapes are likely to contain responsive information will likely differ from yours, especially after you learn about their information systems and key witnesses. In this vein, consider a Rule 30(b)(6) deposition about the opposing party's information systems and preservation procedures before propounding interrogatories and requests for production. For example, you may learn that Defendant uses XYZ software to track the customer complaints that are key to your case, enabling you to frame your discovery requests accordingly.
Absent fraud or duress or the other usual contract defenses, courts are reluctant to release parties from discovery stipulations. By following a few simple guidelines, you can prevent having to explain to your client that you cannot obtain key evidence for your case because you agreed that the opposing party did not have to provide it to you.

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Topics: BiglawWorld | Litigation/Discovery/Trials
 
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