Michigan First Credit Union v. Cumis Insurance Society, Inc., Case No. 05-74423 (E.D. Mich. November 16, 2007)

Sometimes a failed argument and an inaccurate analysis can teach us a lot. Cumis is one of those cases where the court may have made the right decision but completely missed on the analysis, resulting in a decision that may fool you if you’re not careful. Views on metadata, which is the focus of Cumis, its relevancy and usefulness, and the need to produce it are changing rapidly. Dependence on old cases, and 2006 is already old, can lead you down the wrong path.

The court was considering a motion in which the plaintiff sought production of metadata and sanctions for the defendant’s failure to produce it. The defendant had originally objected to production of metadata among other things, and when the court originally ordered production of the documents in response to an earlier motion by the plaintiff, the order did not mention metadata. In its brief in response to the motion for sanctions, the defendant attached a declaration from a senior manager in its “Information Security Assurance” department. She attested to the fact that one of the sources of electronic data had no metadata; a second source – Lotus Notes email messages – had very limited metadata, all the relevant parts of which were actually shown on the email screen shots that were produced; and the final source – Microsoft Office documents – were maintained by the defendant in hard copy and producing the metadata “would consume substantial resources.”

Plaintiff made no real attempt to rebut this latter assertion. Nor did plaintiff make any attempt to show why the metadata was relevant or important. Left without such guidance, Magistrate Judge R. Steven Whalen naturally rejected sanctions and refused to order the production of metadata. In his analysis, however, he sustained the original objection essentially on the ground that the emerging standards of electronic discovery appear to articulate a general presumption against the production of metadata. With all due respect your honor, those emerging standards are so last year.

The court relied on three cases: Wyeth v. Impax Laboratories, Inc., 2006 WL 3091331 (D. Del. 2006); Kentucky Speedway, LLC v. NASCAR, Inc., 2006 U.S. Dist. LEXIS 92028 (E.D. Ky. 2006) and Williams v. Sprint, 230 FRD 640 (D. Kan. 2005). In Wyeth, the court articulated the emerging standard quoted in Cumis. The court referenced Williams’ comment that “most metadata is of limited value, and reviewing it can waste litigation resources.” The court pointed to the Delaware District Court’s Default Standard For Discovery of Electronic Documents, which defaults to production of an image file absent agreement or a showing of particularized need. Particularized need obviously translates into relevance or usefulness, what value does the metadata have. In Wyeth, the moving party failed to make the required particularized showing, so the court denied the request for metadata.

In Williams, the defendant had scrubbed the metadata from Excel spreadsheets and was under an order to show cause. The court noted:

The group of judges and attorneys comprising the Sedona Conference Working Group on Best Practices for Electronic Document Retention and Production (Sedona Electronic Document Working Group) identified metadata as one of the primary ways in which producing electronic documents differs from producing paper documents. The Sedona Electronic Document Working Group also recognized that understanding when metadata should be specifically preserved and produced represents one of the biggest challenges in electronic document production.

In the face of the defendant’s assertion that “emerging standards of electronic discovery articulate a presumption against the production of metadata,” the court analyzed the federal rules and the case law and found an absence of guidance on the production of metadata. Like many courts before and since, the court turned to the Sedona Guidelines, specifically Principles 9 and 12. Principle 9 focuses on the scope of a “document” under Fed. R. Civ. P. 34. The court noted that Comment 9a provides the following illustration:

A party demands that responsive documents, “whether in hard copy or electronic format,” be produced. The producing party objects to producing the documents in electronic format and states that production will be made through PDF or TIF images on CD-ROMs. The producing party assembles copies of the relevant hard copy memoranda, prints out copies of relevant e-mails and electronic memoranda, and produces them in a PDF or TIF format that does not include metadata. Absent a special request for metadata (or any reasonable basis to conclude the metadata was relevant to the claims and defenses in the litigation), and a prior order of the court based on a showing of need, this production of documents complies with the ordinary meaning of Rule 34. (emphasis added)

Comment 12 specifically discusses metadata in depth. The court noted:

The comment [12a] states that ‘although there are exceptions to every rule, especially in an evolving area of the law, there should be a modest legal presumption in most cases that the producing party need not take special efforts to preserve or produce metadata.” The comment further notes that it is likely to remain the exceptional situation in which metadata must be produced.

The court went on to find the “Sedona Principles and comments particularly instructive in how the Court should address the electronic discovery issue currently before it.” The court then held”

Based on these emerging standards, the Court holds that when a party is ordered to produce electronic documents as they are maintained in the ordinary course of business, the producing party should produce the electronic documents with their metadata intact, unless that party timely objects to production of metadata, the parties agree that the metadata should not be produced, or the producing party requests a protective order. The initial burden with regard to the disclosure of the metadata would therefore be placed on the party to whom the request or order to produce is directed. The burden to object to the disclosure of metadata is appropriately placed on the party ordered to produce its electronic documents as they are ordinarily maintained because that party already has access to the metadata and is in the best position to determine whether producing it is objectionable. Placing the burden on the producing party is further supported by the fact that metadata is an inherent part of an electronic document, and its removal ordinarily requires an affirmative act by the producing party that alters the electronic document. (Emphasis added)

Ultimately the Williams court determined that some of the metadata in question was relevant and ordered it produced. Under the standard promulgated by the Williams court, the Cumis decision was correct.

The Kentucky Speedway court rejected the holding in Williams, finding it too liberal in its treatment of metadata. As in Williams, the court pointed to the emerging standards, particularly as articulated in Principle 12 of the Sedona Guidelines. The court correctly pointed out that this issue should be worked out in the Rule 26(f) conference and that plaintiff has not made any showing of particularized need. The court’s idea of particularized need, however, seemed to envision a document by document analysis, which is utterly impossible in the electronic age, given the huge volumes often involved. In other words, the particularized need articulated by the court would not work. The court’s attitude was evident in the following comment: “Metadata may or may not provide the information plaintiff seeks concerning specific documents in this Case.” It seems the emerging standards as articulated in the Sedona Guidelines have been adopted as the default provisions in many cases.

The problem, of course, is that what was emerging in 2006 is no longer emerging. The Guidelines that the courts were pointing to were issued in 2005. In June 2007, the Sedona Conference issued a new set of Guidelines. Principle 9 now contains no reference whatsoever to metadata and the illustration in Comment 9a is no longer the one cited by the Williams court. It relates to something else altogether. Principle 12 now reads as follows:

Absent party agreement or court order specifying the form or forms of production, production should be made in the form or forms in which the information is ordinarily maintained or in a reasonably usable form, taking into account the need to produce reasonably accessible metadata that will enable the receiving party to have the same ability to access, search, and display the information as the producing party where appropriate or necessary in light of the nature of the information and the needs of the case. (Emphasis added)

The text of Comment 12a endorses the concept of fairness, stating:

Aside from its potential relation to the facts of the case, metadata may also play a functional role in the usability of electronically stored information. For example, system metadata may allow for the quick and efficient sorting of a multitude of files by virtue of the dates or other information captured in metadata. In addition, application metadata may be critical to allow the functioning of routines within the file, such as cell formulae in spreadsheets.

* * *

The extent to which metadata should be preserved and produced in a particular case will depend on the needs of the case. Parties and counsel should consider: (a) what metadata is ordinarily maintained; (b) the potential relevance of the metadata to the dispute (e.g., is the metadata needed to prove a claim or defense, such as the transmittal of an incriminating statement); and (c) the importance of reasonably accessible metadata to facilitating the parties’ review, production, and use of the information. In assessing preservation, it should be noted that the failure to preserve and produce metadata may deprive the producing party of the opportunity later to contest the authenticity of the document if the metadata is material to that determination. Organizations should evaluate the potential benefits of retaining native files and metadata (whether or not it is produced) to ensure that documents are authentic and to preclude the fraudulent creation of evidence.

When dealing with metadata, it helps to stay current. Cases that rely on the 2005 version of the Sedona Guidelines are out of date and generally based upon an early and incomplete understanding of the value and uses of metadata. Court standards, such as those from the District of Delaware, that were issued before June 2007 may well be equally out of date.

Read the Cumis case

Read the Williams case

Read the Kentucky Speedway case

Read Wyeth