Category Archives: Cases of Interest

Cases of Interest, Duties, Privilege, Spoliation

Spoliation Spoils the Broth at Toyota?

J0438712 This one is a little quirky because, based on my research, I'm somewhat uncomfortable with the plaintiff, however, it does well to illustrate how a case can become a P.R. nightmare even before the defendant files an answer.

In Biller v. Toyota Motor Corp., 2:09-cv-5429, U.S.
District Court, Central District of California (Los Angeles) (warning: link opens a 117-page pdf), plaintiff Biller (formerly an attorney for Toyota) asserts that defendant Toyota concealed and destroyed evidence critical to hundreds of rollover cases.  Toyota has motioned to seal the case, citing violation of attorney/client privilege.

Oh boy.  I hated these hypothetical questions in law school.  When may an attorney in a position of confidentiality, break privilege to expose wrongdoing?  What about his corporate duties?  Not easy to discern when attorney and manager are one-and-the-same.  It depends what jurisdiction you're in and which code must be followed.  We used to call it the "climb-the-ladder" obligation.  Bring your concerns to the appropriate executives and hope they'll do the right thing.  You also have to look to who is being damaged and the level and extent of that damage.

Who, exactly, may an attorney speak with when the very act of revealing information – even within the company itself and ostensibly for a proper purpose – may still violate privilege?

This is the kind of issue that could result in a treatise that goes on for page after page, but to distill it down to basics, attorneys are officers of the court first – not the client; their duty of loyalty is clear.  What's not so clear; when does a violation cross the threshold that allows the attorney to go outside of privilege?

We won't know more details about this for a while, but it's one to watch.  My immediate thoughts are, 1) Plaintiff had better have some convincing evidence to back up his claims and 2) Toyota had better hope he doesn't.

Two things are clear.  Even if the claims are proven false, Toyota is already the loser, and as sure as I'm sitting here, this will appear as a question on the California Bar exam in 2012 (just kidding; I assume my position on the Executive Committee in about 10 days, so I don't want anyone jumping to the conclusion that I would ever know what will be on the exams).

Cases of Interest, eMail, Privilege

First there is a Mountain, then there is no Mountain, then there is…

J0407504 For our purposes, substitute the word "e-mail" where you see the word "mountain".  I was reviewing an appellate decision from two months ago, Stengart v. Loving Care Agency, Inc., 2009 N.J. Super. LEXIS 143 (App.Div. June 26, 2009).

The facts are simple.  The court ruled that password-protected emails from a personal account that were accessed on a company computer were not necessarily fair game for the employer.  The particular emails involved the employee corresponding with her attorney; privileged communication.

I suppose if I simply admonish you not to use your company collateral for personal purposes, you're going to ignore me, but it's missing the point, anyway.  You can't un-ring the bell.  Sure, I understand that, in this case, they were forced to return the emails and there was to be a decision as to whether the law firm that read the emails could even continue in their representation, but the bottom line is, the emails were still read.

This is purely a "Perry L. Segal" approach – and you may not agree with me – but my view is this; don't wait for someone else to do your job for you.  Don't wait for your lawyer to make an argument, don't wait for a judge to rule in your favor, don't wait at all!  Don't do the conduct with the attitude that you are the one that won't get caught or your rights won't be violated.  Gambling is great – if you're in Atlantic City.

There was a case going back 30 years or so in which hackers got into a secure computer system.  They were brought to trial and were acquitted.  Why?  Because after they hacked through the first line of defense, the screen they arrived at said, "Welcome".  The judge ruled that this was the same as an invitation to proceed…

I rest my case…

Cases of Interest, Cost, Duties, Law, Sanctions, Spoliation

Case Got Your Tongue? Safe Harbor, Spoliation & Sanctions, Oh My!!!

Melting Pssssst!  See the attorney in the funny hat on the right?  She screwed up her e-discovery case!

A little housecleaning, if I may.  Some of you may have noticed that I didn't do this feature last month.  That's because, after reviewing all of the cases, I kept repeating the same word – Duh!  My assumption is that you, like I, have very little time to waste.

Last month's cases involved weak attorney arguments – made to cover for a mistake – that were tossed by a judge who was having none of it!  Summaries are available everywhere, but I'm looking for cases that either 1) tell us something we don't know, or 2) clarify something we do know.

KCH Services, Inc. v. Vanaire, Inc., 2009 U.S. Dist. LEXIS 62993 (W.D. Ky. July 21, 2009)

NOTICE THIS! – The issue is simple.  When is one sufficiently on notice of potential litigation?  Simple in principle, maybe, but think about it for a moment.  If you're a huge company, irate customers might be calling every day, threatening to sue.  Should you take every single one seriously and immediately issue a litigation hold letter?  In the instant case, the court ruled (in my opinion, correctly) that the person receiving the call had sufficient basis to deem the threat of litigation credible and serious and therefore, should have issued a hold in anticipation of same.

Arista Records LLC v. Usenet.com, "Usenet II", 2009 U.S. Dist. LEXIS 55237 (S.D.N.Y. June 30, 2009)

HOW SAFE IS YOUR HARBOR? – I posed this question recently in my analysis of the new e-discovery California rule.  Here's an example of how you lose it.  Shenanigans!  Is that a legal term?  Oh well…

Spieker v. Quest Cherokee, LLC, “Spieker II”, 2009 U.S. Dist. LEXIS 62073 (D. Kan. July 21, 2009)

COST-SHIFTING TURNED INSIDE/OUT – I'll give this one points for originality, but again, the fact that your IT staff has no experience complying with an e-discovery subpoena is not going to get you any sympathy from the judge.  As far as the costs themselves, I wonder if a California judge might rule differently using our "Toshiba" standard?

In a future post, I will endeavor to address this question – if I don't have to waste too much time reading the "Duh!" cases…

Admissibility, Cases of Interest, Constitution, Criminal Liability, Duties, Law, Privilege, Sanctions, Spoliation, Technology

State of the (e-Discovery) Union; The Sequel

Aspirin My prior post was the Reader's Digest version.  Now, get ready for the migraine version…

Gibson, Dunn & Crutcher LLP has released a comprehensive mid-year update on e-discovery.  This is simple, folks.  If the responsibility for e-discovery sits squarely on your shoulders – and if you take that responsibility seriously – you need to read this publication, no matter how long it takes or how painful it might be (I have some aspirin if you need it…it'll come into play when you read about the increase in sanctions…)

Cases of Interest, Duties, Law, Metadata, Sanctions, Technology

Case Got Your Tongue? “Don’t Tase Me, Bro!!!”

J0315556 Here I go with my latest summary of lead cases I think are of interest.  When it comes to electronic devices that might be subject to e-discovery, I thought I'd thought of everything.  I was wrong…

Ford Motor Co. v. Edgewood Properties, 2009 U.S. Dist. LEXIS 42001 (D.N.J. May 18, 2009)

USE IT OR LOSE IT – This is a classic example of where technical minds weren't properly involved from the outset of litigation and that lack of involvement resulted in a waiver.  The Defendant properly sought production of documents in native format with metadata intact.  The problem is, Plaintiff complied by delivering the documents in TIFF format.  Plaintiff waited six months to request the data again in native format and another two months to make a motion before the court.  The court deemed eight months too long and as a result, ruled Defendant waived its right to receive the documents in native format.

I admit I'm inserting my opinion here, but let's face it; the incoming data should have gone straight to a technical mind for immediate analysis.  A cursory review would have discovered the issue and Defendant could have addressed it within a reasonable time.  On the other hand, if Defendant knew about the issue and was simply tardy in addressing it, shame on them.

McGarry v. Becher, 2009 U.S. Dist. LEXIS 40879 (S.D. Ind. May 13, 2009)

"DON'T TASE ME, BRO!!!" – This potential class-action criminal case may be summed up in one sentence.  The court ruled that memory from tasers is both discoverable and not burdensome on the Defendant.  Add tasers to your list of electronic devices!

1100 West v. Red Spot Paint and Varnish Co., 1:05-cv-1670-LJM-JMS (S.D. Ill. June 5, 2009)

KHARMA CHAMELEON – Don't waste any more time here.  Go directly to Ralph Losey's blog, e-Discovery Team (do not pass go and do not collect $200) and read his treatise on this case; the best post about attorney ethics – or lack thereof – I've seen in a long time!

Cases of Interest, Criminal Liability, Duties, Law, Privilege, Spoliation, Zubulake

Case Got Your Tongue? Mirror, Mirror & Searching the Forest

J0440920 Another interesting collection of cases crossed my desk, recently.  I'm going to refrain from writing about the "wake-up call" case because it's being cited everywhere.  Besides, if anyone hasn't noticed yet, my entire blog is about that.  Furthermore, we already know about my issues with waking up…

By coincidence, two of the cases involve mirror-images of disks; however, the issues in each are completely unrelated.  Also, we have another illustration of how, when rules aren't followed to the letter, one can destroy a criminal case.

Am. Family Mut. Ins. Co. v. Gustafson, 2009 WL
641297 (D.Colo. Mar. 10, 2009)

YOU GOT IT, I TAKE IT – Plaintiff requested that the court set the protocol for the inspection of the mirror-image of Defendant's hard drive.  The court obliged, and in doing so, provided what I think is an excellent guide for anyone undertaking this process.

Forest Laboratories, Inc. v. Caraco Pharm. Laboratories, Ltd., 2009 U.S. Dist. LEXIS 31555 (E.D. Mich. Apr. 14, 2009)

ZUBULAKE – There's only one way to describe this case; Zubulake Duty applies, except when it doesn't…

I can't count how many times on this blog I've referred to how
exceptions to a rule may be more dangerous than the rule itself. 
Forest illustrates that point.  This falls under the "knew, or should
have known" category.  The court is saying that if Plaintiff knew, or
should have known that ESI might be relevant to a dispute in the
future, they should have sought to preserve it – for key employee documents only – contrary to existing
company policy.  A tall order.  Talk about hindsight!

State v. Dingman, 2009 Wash. App. LEXIS 550 (Wash. Ct. App. Mar. 10, 2009)

This case also involves mirror-images of hard drives.  It should serve as a cautionary tale to anyone on the prosecutorial side of the equasion.

The State seized Defendant's computers.  Defendant wanted mirror-images of his computers' hard drives in a certain format and the State refused to provide them in that format.  The court found this to be prejudicial to Defendant and a violation of his Constitutional rights.  Defendant's conviction was overturned.

Still think the 4th, 5th & 6th Amendments don't apply to e-Discovery?

Cases of Interest, Criminal Liability, Miscellaneous

e-Discovery Creates a Moral Dilemma

J0422326 Every once in a while, life throws you a curve-ball…

One of the things that surprised me when I was in law school was the graphic detail in many of the cases we studied.  To put it mildly, they don't mince words.  Everything is described specifically and deliberately, down to the smallest detail.  Honestly, it's not for the faint of heart.

When I clerked at the Los Angeles County District Attorney's Office during law school, I worked on one case for three years.  It involved the kidnapping and gang-rape of two women by some very unsavory characters.  How unsavory?  Well, the Defendant in my particular case was sentenced to something akin to 500 years in prison (whenever I tell the story, I always follow up with the quip, "Don't worry – he's up for parole in 325 years…")

My boss gave the case to me because I was much older than the other law clerks and they were having trouble dealing with the graphic testimony.  It was difficult for me as well, but I managed.

Now comes another element to e-Discovery that I hadn't considered.  As you know from my writing, I'm firmly concentrating in the area of corporate law.  You might say that criminal law is a hobby – but I don't think one can ever use that term when someone's liberty is at stake.  The fascinating thing about criminal law is the 'mens rea' (guilty mind) aspect.  How do you crack open somebody's mind and show what they were thinking?  Besides, with these cases, even if criminality is ever in question, we're talking 'white-collar' crime, here.  How bad could it be?

And then I was approached regarding a completely different kind of case…

…a child-porn case, to be exact.  On the defensive side.  Might even entail expert testimony.

The attorney emailed me the new Tecklenburg case (warning: link opens 28-page pdf) from Westlaw that is at issue.  When I saw the words "children & pornography" in the search results in the body of the email, I had a visceral reaction – as I think most of us would.  I didn't even want to discuss the case using email, lest some spam filter – or worse – detect those words in my correspondences.

And therein lies the dilemma.  Attorneys aren't obligated to take a particular case; and certainly consultants aren't, either.  But here, a fundamental principle of our Constitution is at stake – Defendant is innocent until proven guilty.

What would you do?

I'm still thinking…

Cases of Interest, Criminal Liability, Law, Metadata, Privilege, Sanctions

Case Got Your Tongue? Bray, the SEC goes ‘Bad’ & Brodie gets the ‘News’

PH03099ISorry I’ve been missing in action the past few days.  It’s good and bad.  The good?  I’m really busy.  The bad?  I have less time to post.

I’ve decided to start another periodical series on lead e-discovery cases.  We all have access to these resources, but what I’m endeavoring to do is pick out what I think are the ones you need to know.  As well, I’m going to focus on some of the cases with criminal implications because, 1) it’s an area of interest to me, and 2) I continue to expect there’ll be more cases that induce criminal liability – both for the clients and the attorneys – and I want you to avoid this minefield.  Yeah, I know, once again it’s my theory – but I’m sticking to it!

Also, this will make me a better lawyer because it forces me to take more time reviewing the plethora of cases I receive weekly.  So, in the end, we all benefit.

From now on, whenever you see “Case Got Your Tongue?”, it’ll be another summary.  I hope you find them helpful.  Let’s get started…

Bray & Gillespie Mgmt. LLC v. Lexington Ins. Co., 2009 U.S. Dist. (M.D. Fla. Mar. 4, 2009)

SANCTIONS – Your adversaries are getting more sophisticated, folks.  You can try to bury them with paper and hope that you’ll slip by without complying properly with the subpoena – and you can lie about it if you want to, but make no mistake; more of you are getting caught.

SEC v. Badian, 2009 U.S. Dist. (S.D.N.Y. Jan. 26, 2009)

CLAWBACK – This is a back-door way to criminal liability.  The mistake started at the beginning…

Improper and/or lazy review caused inadvertent production of possibly incriminating documents.  Lesson learned:  Get it right the first time.  An attorney’s letter stating that you retain “clawback rights” doesn’t mean that you do just because you make the claim.

The example I often use is, you can put a sign on your property that says, “Trespassers will be Shot”, but that doesn’t create the unlimited license to shoot people.  Depending on the facts, you may still be charged with murder – or any lesser offense – warning or not.

Independent Newspapers, Inc. v. Brodie, 2009 Md. (Md. Feb. 27, 2009)

INTERNET ANONYMITY – This is a real lawyer’s case and should send shivers up the spine of anyone who thinks they can say whatever they want in internet forums and retain their privacy and 1st Amendment protections.  I’ve warned about this before – anything you say or do on the internet may come back to haunt you someday – and may be discoverable.  Well, Maryland’s Court of Appeals agrees.

I’m not sure how often I’m going to do this series.  Of course, it’ll depend on the cases that come across my desk.  If they simply affirm rules we already know, I’m not as inclined to post.  Let’s see what the next few weeks have in store for us…

Oh, and it’s good to be back!

Cases of Interest, Duties, Law, Privilege, Sanctions

Report to the Principal’s Office!

j0316801 Here’s the tough part – you’d better be sure which Principal’s office is the correct one.  In my prior post, I discussed Principals and Agents from the perspective of both.  But this one is for attorneys; and again, I feel this is relevant in the arena of e-discovery because there will be corporations – and individual custodians – involved.

The Wall Street Journal posted this article about a case which serves as a cautionary tale of what may happen when attorneys endeavor to serve multiple masters (note: you may be required to register, but it’s free).  Ironically, it involves Broadcom (which we know has been at the hub of some very ground-breaking case law involving e-discovery sanctions).

The issue here is that executives were unsure of exactly who their attorneys were representing.  The attorneys represented the corporation, but apparently did not make it clear that they did not represent the executives as well; and I think most of you can understand the inherent conflict of interest that could potentially develop if the interests of both diverge.

This was a critical part of ethics (Professional Responsibility) class in law school and on the bar exam.  The graders wanted to make absolutely sure we knew at all times who our particular client was when representing a corporation.  As stated above, it’s the corporation, not you.  If you think you’re in jeopardy, there’s no middle ground; you must retain your own attorney to protect your interests.

Irell & Manella LLP failed to properly make this distinction clear – and the judge is making them stay after school.

Backup & Recovery Systems, Cases of Interest, Cost, Disaster Recovery, eDiscovery California, Spoliation, Zubulake

I’m Good Enough, I’m Smart Enough & Doggonit, People Like Me…

Cute Sheep…and eventually, I’ll write an in-depth analysis of California AB 5 and contrast it with the Federal Rules.  But, take a look at this fine analysis from Law.com regarding how California will deal with Zubulake ‘accessible vs. inaccessible’ ESI and how it contrasts with the Federal rules.

Finished reading?  Great.  Now let me tell you why nothing in the analysis rattles me.  You should have been treating your ESI as accessible all along.  Here’s why:

The law is all about exceptions.  Everyone knows the general rule, but ultimately the facts dictate whether an exception is in order.  At Sony Pictures in 1997, we successfully fought off a request for ESI in a California court because we made the case that it was accessible, but at punitive cost because we’d long since retired that particular backup system and complying would have required a $250,000 outlay (there was no product like Index Engines around in 1997).

I had a very smart professor in law school.  His advice was to always assume the worst-case scenario, then work backwards.  It’s actually a very logical approach.  Yes, the flood may be that bad, yes, the stock market may fall that much and yes, your adversary may make a persuasive argument to the judge.

Be an actuary.  They look at everything as ‘cost vs. risk’.  Which will likely cost more, paying to protect or paying after the fact?  A young PC user asked me the other day, “Why do I need a firewall?  What are the chances that I will be the one that will be hacked?”  My answer was, “If you want to gamble, that’s your call, but here’s a short list of things that could happen if you’re the unlucky one.”

Gamble if you like; but be prepared to face the consequences.