On April 29, 2015, the United States Supreme Court adopted the package of proposed amendments to the Federal Rules of Civil Procedure (“FRCP”) that had been approved by the Civil Rules Advisory Committee (the “Committee”). This amendment package, which is set to go into effect on December 1, 2015 absent congressional interference, represents the most significant overhaul of the rules governing civil litigation in federal court that we’ve seen in decades, including dramatic changes to the timing and procedure surrounding case management and a veritable sea change in the scope of discovery.
This article briefly recounts the history surrounding these changes and includes a chart with an at-a-glance summary of the 2015 Amendments, which amend Rules 1, 4, 16, 30, 31, 33, 34, 37, and 55 and abrogate Rule 84 and the Appendix of Forms. Then, following the chart, some of the most notable amendments in the package are redlined and discussed more fully.
I. HISTORY OF THE 2015 AMENDMENTS TO THE FRCP
The FRCP was enacted to achieve a singular, overarching objective – a just, speedy, and inexpensive resolution to every civil action in federal courts. Despite this lofty goal, years of complaints about the costs, delays and burdens of civil litigation in federal court prompted the Committee to step back and take a sobering look at the efficacy of the FRCP.
Toward that aim, the Committee held a Civil Litigation Conference (the “Conference”) at Duke University School of Law in the Spring of 2010. In preparation for the Conference, the Committee commissioned, assembled and reviewed a mountain of empirical data assessing the federal civil justice system. Then, on May 10, 2010, hundreds of attorneys representing a variety of practice areas converged on Durham, North Carolina for the Conference. Over the course of two days, more than 70 panelists comprising judges, lawyers and academics presented the empirical data and engaged the audience in lively discussions about various ways to remedy the scourge of cost and delay attendant to litigating civil cases in federal court.
Out of the discussions at the Conference, a framework for possible amendments to the FRCP was conceived. And over the next five years, this framework endured several cycles of comment, revision and refinement, which has culminated in the 2015 Amendments to the FRCP – the most robust and significant changes to the federal civil rules in decades. These amendments are intended to redress three key themes highlighted during the Conference: (1) the need for better case management; (2) more effective use of the long-ignored principle of “proportionality”; and (3) an increased emphasis on the role of cooperation among the parties in discovery. The amendments are expected to reduce the cost and delay that has plagued civil litigation in federal court in recent years (largely due to the recent revolution in information technology), and to reposition the FRCP to achieve the goal of helping civil litigants in federal court to obtain just, speedy and inexpensive resolutions to their actions.
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II. DISCUSSION OF AMENDMENTS TO RULES 4, 16, 26, 34, AND 37.
Below is a more detailed explanation of the impending amendments to Rules 4, 16, 26, 34, and 37.
A. RULE 4: TIME LIMIT FOR SERVICE.
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The amendments to Rule 4(m) were born out of the perception that the initial stages of civil litigation simply take too long. The general consensus of the Committee was that it should not take four months to serve a summons and complaint. While the Committee initially considered cutting the time limit for service in half, commenters on that proposed change offered a host of reasons why a 60-day period was not long enough (e.g., evasive defendants, the difficulty of identifying defendants through chains of interlocking or changing corporate relationships, the challenges of effecting service in multiple-defendant cases, and the fact that a 60-day period would effectively deprive plaintiffs of an opportunity to request a waiver of service). As a result of the concerns reflected in the comments, the Committee decided to shorten the time limit for service from 120 days to 90 days.
Shortening the time limit for service produces two notable, collateral effects. First, Rule 15(c)(1)(C) permits an amendment to a pleading to relate back to the date of the original pleading under certain circumstances. Of particular relevance here, an amendment relates back when it changes the party or the naming of the party against whom a claim is asserted, the claim arises out of the conduct, transaction or occurrence set out in the original pleading, and if, within the period provide by Rule 4(m), the party to be brought in by amendment receives notice of the action such that it will not be prejudiced in defending on the merits and knew or should have known that the action would have been brought against it, but for a mistake concerning the proper party’s identity. Thus, as explained in the Advisory Committee Notes, “[s]hortening the time to serve under Rule 4(m) means that the time of the notice required by Rule 15(c)(1)(C) for relation back is also shortened.”
Second, the shortened service period threatened to infringe the rights of property owners in condemnation proceedings. As explained in a May 8, 2013 Report of the Advisory Committee on Civil Rules, “Rule 71.1(d)(3)(A) directs that service of notice of [condemnation] proceeding be made on defendant-owners ‘in accordance with Rule 4.’ This wholesale incorporation of Rule 4 may seem to include Rule 4(m). Invoking Rule 4(m) to dismiss a condemnation proceeding for failure to effect service within the required time, however, is inconsistent with Rule 71.1(i)(C), which directs that if the plaintiff ‘has already taken title, a lesser interest, or possession of’ the property, the court must award compensation. This provision protects the interests of owners, who would be disserved if the proceeding is dismissed without awarding compensation but leaving title in the plaintiff.”
To respond to concerns that shortening the time limit for service would negatively impact owners in condemnation proceedings, the Committee amended Rule 4(m) to make clear that Rule 4(m) does not apply to service of a notice of condemnation proceedings under Rule 71.1(d)(3)(A).
B. RULE 16: SCHEDULING.
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The amendments to the case management provisions of Rule 16(b) continue the Committee’s efforts to streamline the initial stages of civil litigation, and to encourage early judicial involvement. These amendments impact the case management process in four important ways.
First, seizing on the notion that cases are resolved more quickly and with less expense when there is early, active judicial oversight, the Committee omitted the phrase “by telephone, mail, or other means” from Rule 16(b)(1)(B). Instead, the Committee now mandates “direct simultaneous communication” between the litigants and courts during the Rule 16 schedule conference, which now must be held in person, by telephone, or by other “more sophisticated” electronic means. Second, the time frame within which courts must issue scheduling orders has been reduced to the earlier of 90 days after any defendant has been served with the complaint or 60 days after any defendant has appeared in the litigation. However, recognizing that “[l]itigation involving complex issues, multiple parties, and large organizations, public or private, may be more likely to need extra time to establish meaningful collaborations[,]” Rule 16(b)(1)(B) allows courts to delay the issuance of the order on a finding of good cause. Third, noting the growing role of electronically stored information in civil litigation, the Committee is encouraging litigants to address issues surrounding ESI early. Toward that aim, Rule 16(b)(3)(B) now permits courts (a) to incorporate in scheduling orders the parties’ agreements for asserting claims of privilege and work-product protection (including FRE 502 agreements), and (b) to provide in scheduling orders for the preservation of ESI. These amendments were made to remind litigants that early consideration of these subjects can simplify the discovery process, especially use of FRE 502 agreements, a discovery tool the Committee found grossly underused.
Fourth, Rule 16(b)(3)(B) also has been amended to allow courts to require parties to request a conference before filing a discovery motion. The Advisory Committee Notes acknowledge that “[m]any judges who hold such conferences find them an efficient way to resolve most discovery disputes without the delay and burdens attending a formal motion[.]”
C. RULE 26: PROPORTIONAL DISCOVERY, ALLOCATION OF COSTS, AND EARLY REQUESTS.
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The amendments to Rule 26 are intended to promote efficiency and prompt early discussion about discovery between the parties.
The most significant change to Rule 26 amends the scope of permissible discovery by requiring discovery to be proportional to the needs of the case and by deleting the oft-cited phrase, “[r]elevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence.” The proportionality factors added to Rule 26(b)(1) are not new. Indeed, most factors were added in 1983 and all but one factor – the parties’ relative access to information – are currently found in Rule 26(b)(2)(C)(iii), albeit in a different order. By relocating the factors, the amended Rule 26 now explicitly requires parties to consider proportionality when propounding discovery. While proportionality is an important principle to be applied to all of discovery, the Advisory Committee Note explains that this change neither places the burden of addressing all proportionality considerations on the party seeking discovery nor permits the opposing party to refuse discovery by making boilerplate objections based on proportionality.
Rule 26 has also been amended to explicitly recognize a court’s authority to enter protective orders that allocate expenses for disclosure or discovery. This explicit recognition is intended to forestall the temptation of some parties to contest the court’s authority in this regard; however, the Committee warns that this change does not imply that cost-shifting should become common practice, adding “[c]ourts and parties should continue to assume that a responding party ordinarily bears the costs of responding.”
Further, the moratorium on discovery before the Rule 26(f) conference has been relaxed to permit parties to propound Rule 34 requests earlier. The requests, however, are not considered served until the first Rule 26(f) conference and under Rule 34(b)(2)(A), the time to respond runs from service. This early delivery is meant to facilitate and focus discussion between the parties at the initial case management conference, which may produce changes in the requests. The Advisory Committee Notes also make clear that early delivery of requests “should not affect a decision whether to allow additional time to respond.”
Finally, Rule 26(f)(3) was amended to be parallel with Rule 16(b)(3) as discussed above.
D. RULE 34: SPECIFIC OBJECTIONS AND TIME TO RESPOND.
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Rule 34 was amended to reduce potential unreasonable burdens and discovery disputes caused by the use of broad, boilerplate objections to requests, responses that do not state whether responsive documents are being withheld, and responses stating that responsive documents will be produced in due course. To do so, the rule has adopted the language from Rule 33(b)(4), explicitly requiring objections to be stated with specificity. The Advisory Committee Note explains that this specificity requirement is tied to the new provision in Rule 34 directing that an objection must state whether any responsive materials are being withheld. Thus, for example “[a]n objection may state that a request is overbroad, but if the objection recognizes that some part of the request is appropriate the objection should state the scope that is not overbroad,” such as stating that the responding party will limit the search to documents or ESI within a given time period. This change is meant to end the confusion that occurs when a party states several objections and still produces information.
To reflect common practice, the rule was also amended to permit a party to produce copies of documents or ESI instead of permitting inspection. The amended rule, however, clarifies that the production must be completed “no later than the time for inspection specified in the request or another reasonable time specified in the response.” According to the Committee, if the production must be made in stages, “the response should specify the beginning and end dates of the production.”
Further, as mentioned above, Rule 34 now permits requests for productions to be delivered before the Rule 26(f) conference.
E. RULE 37: FAILURE TO PRODUCE AND ESI.
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The amendments to Rule 37 are meant to take into account the exponential growth of ESI, and in particular, the preservation and loss of ESI, which have been major issues confronting parties and courts and have caused a significant circuit split on the level of intent, if any, required for a court to impose sanctions for the loss of ESI.
The amended rule establishes preliminary requirements that must be satisfied before a court may consider whether sanctions are appropriate for the loss of ESI. First, the ESI should have been preserved in the anticipation or conduct of litigation. This duty is not new; it is based on the common-law duty established through case law. The Advisory Committee Notes warn that, in some cases, there may be an independent requirement to preserve information established from other sources, including statutes, administrative regulations, an order in another case, or a party’s own policies. Failure to preserve ESI pursuant to those independent duties, however, does not necessarily establish that a party made unreasonable efforts to preserve information in the action at issue. In deciding whether and when a duty to preserve arose, the Committee has advised courts to “consider the extent to which a party was on notice that litigation was likely and that the information would be relevant.”
Second, the party must have failed to take “reasonable steps.” According to the Committee, “it does not call for perfection.” Whether a party’s action was reasonable depends on proportionality and courts should consider a party’s resources and preservation efforts.
Third, the lost ESI cannot be restored or replaced. This is an important requirement because as the Committee makes clear, “[i]f the information is restored or replaced, no further measures should be taken.” Moreover, in line with the larger theme of the 2015 Amendments, any additional discovery required to restore or replace information should be proportional to the importance of the information.
If these preliminary requirements are satisfied, and the court finds prejudice on the other party from the loss of information, then the court has discretion to order curative measure that are “no greater than necessary to cure the prejudice.” The rule does not place the burden on one party to prove or disprove prejudice, leaving judges with discretion to determine how to assess prejudice.
Alternatively, if the party who lost the ESI acted with the intent to deprive the other party of the information, a court may take more severe measures – presume the information was unfavorable to the party that lost it, provide a negative inference jury instruction, or even dismiss the case. Note, that this subdivision does not require a finding of prejudice. Further, the Committee warns that “[c]ourts should exercise caution . . . in using the[se] measures,” and states that finding an intent to deprive the other party of information “does not require a court to adopt any of the[se] measures” because the remedy should be proportional to the wrong.
These amendments are perhaps the most significant changes to the FRCP in the last two decades. For this reason, attorneys litigating in federal court must be especially vigilant in familiarizing themselves with these amendments, which represent a marked change in how civil litigants operate in federal court.