This Sidley Update addresses the following recent developments and court decisions involving e-discovery issues:
- a Northern District of Ohio decision rejecting burden arguments and requiring defendant either to write a program to extract data from an existing database or to provide plaintiff’s expert access to extract data from the database — but ruling that plaintiff bear the reasonable cost of such discovery if the defendant writes the program
- a Southern District of Indiana case granting in part a motion to compel production of social media, ordering production of public data and private data relating to alleged injuries along with metadata relating to specific posts if the defendant demonstrates the metadata’s relevance but denying requests for broader production of general private social media information
- a U.S. Court of Appeals for the Fifth Circuit per curiam opinion finding that a district court had abused its discretion in dismissing a lawsuit as a sanction for purported noncompliance with discovery orders a District of New Mexico ruling denying a motion to compel the production of electronically stored information (ESI) in native electronic format where the documents were stored in the ordinary course of business both electronically and in hard copy
1. In Meredith v. United Collection Bureau, Inc., 2017 WL 1355696 (N.D. Ohio Apr. 13, 2017), U.S. District Judge Patricia A. Gaughan rejected burden arguments in requiring defendant to write a program to extract data from an existing database or to provide plaintiff’s expert access to extract data from the database but ruling that plaintiff bear the reasonable cost of such discovery if the defendant writes the program.
Plaintiff, a consumer who received multiple recorded telephone calls from the debt collection service defendant, alleged that defendant’s calls violated the Telephone Consumer Protection Act (TCPA) and asserted class claims against defendant.
In discovery, plaintiff sought information from defendant sufficient to identify the number and identity of calls made by defendant to wrong numbers, along with associated account notes. Id. at *2. Deposition testimony established that the information plaintiff sought could be extracted from defendant’s database by creating and executing a program to query the database. When defendant refused plaintiff’s request to create and execute such a program, plaintiff moved to compel.
Defendant opposed the motion to compel and sought a protective order on two grounds: (1) that Rule 34 limits the production of ESI to the manner in which it is “kept in the usual course of business,” and by asking defendant to write a program that does not already exist, plaintiff was asking for ESI that is not kept in the usual course of business, and (2) that writing and testing such a program “would take a few days” and could harm the defendant’s ability to conduct its business during regular business hours. Id. at *3.
Judge Gaughan applied Fed. R. Civ. P. 26(b)(1) and first found that the ESI requested was relevant to both establishing the size and nature of the class and to the merits of plaintiff’s TCPA claims. She further found that plaintiff could not obtain the requested information by other means. Judge Gaughan rejected defendant’s argument that the requested ESI did not exist in the ordinary course of business, finding that “[c]ourts have long recognized that defendants may be required under the Federal Rules to create computer programs to search an existing database for relevant information.” Id. (citing cases). Judge Gaughan quoted approvingly from a Northern District of California case: “[While] a party should not be required to create completely new documents, that is not the same as requiring a party to query an existing dynamic database for relevant information.” Id. (quoting Apple Inc. v. Samsung Electronics Co. Ltd., 2013 WL 4426512, at *2-*3 (N.D. Cal. Aug. 14, 2013)).
Judge Gaughan also rejected defendant’s burden argument, finding that courts have allowed ESI discovery even where it would take many days to produce the data and determined that the burden on defendant did not outweigh the likely benefit of production.
On this basis, Judge Gaughan ordered defendant to either (1) write the program that would produce the class data of wrong number calls and associated account notes for the class period or (2) produce the relevant portions of its database to plaintiff so that her expert could write the program and conduct the query himself. Judge Gaughan ordered plaintiff to bear the costs associated with the discovery if defendant wrote the program, or, in the alternative, ordered defendant to provide plaintiff with information and assistance (including potentially deposition testimony) sufficient to allow plaintiff’s expert to write a program capable of the extracting the requested ESI.
2. In In re Cook Medical, Inc., IVC Filters Marketing, Sales Practices and Products Liability Litigation, 2017 WL 4099209 (S.D. Ind. Sept. 15, 2017), Magistrate Judge Tim Baker granted in part a motion to compel production of social media ordering production of public data and private data relating to alleged injuries, as well as metadata for specific posts if the defendant demonstrated the metadata’s relevance but denying broader production of general private social media information.
In this bellwether products liability multidistrict litigation related to an implanted filter, defendants filed a motion to compel certain discovery responses before trial. Id. at *1. Magistrate Judge Baker first considered a waiver issue, with defendants arguing that a blanket waiver of all objections was appropriate because plaintiff’s response to the requests was delayed by 11 days, and plaintiff did not submit a privilege log. Magistrate Judge Baker held that a blanket waiver was inappropriate because blanket waivers are generally reserved as a sanction for unjustified delay, and plaintiff’s 11-day delay was due in part to a hurricane. In addition, a blanket waiver for the failure to produce a privilege log was inappropriate because plaintiff made a good-faith showing that portions of the requested material were privileged. Id. at *2. That said, even though a blanket waiver was not warranted, Magistrate Judge Baker did hold that plaintiff had waived several objections by failing to assert them in her response to the discovery requests. Id. at *2-*3 (citing Fed. R. Civ. P. 33(b)(4), 34(b)(2)(A)-(C)).
Magistrate Judge Baker next considered the format and scope of production related to defendants’ request for social media. Defendants had sought an order compelling plaintiff to produce social media data in native format. Id. at *3. Magistrate Judge Baker noted that while Rule 34(b)(1)(C) provides that parties may specify the format in which electronically stored information is produced, the responding party may object under Rule 34(d)(2)(D). In this instance, plaintiff argued producing social media data in native format with the associated metadata was intrusive and would contain additional private information. Magistrate Judge Baker held that defendants had failed to make a sufficient showing to obtain metadata for all responsive social media data. Id. at *4. Instead, defendants could request the native files for specific posts upon showing that the metadata for these posts was relevant.
Defendants had also sought the production of plaintiff’s publicly available and private social media data. With respect to publicly available social media, Magistrate Judge Baker noted that viewing a public social media profile does not violate any privacy rights, as “the very nature of social media limits parties’ privacy expectations.” Magistrate Judge Baker thus granted the motion to compel the production of publicly available social media, though plaintiff was not required to bear the costs of producing information that defendants could obtain through an Internet search.
With respect to private social media, Magistrate Judge Baker noted that any request must be relevant and proportional to the needs of the case, stating that “[t]he requesting party does not have an unfettered right to rummage through the responding party’s social media and must limit the time period and content of the request.” Id. at *5. In a case in which plaintiff was seeking damages for loss of enjoyment of life, emotional distress and medical issues, defendants requested social media data regarding, among other things, plaintiff’s travel, hobbies, social activities, medical conditions and recovery. Magistrate Judge Baker concluded that this request was “aimed ... at particular aspects of alleged injuries” and ordered plaintiff to comply with the request. On the other hand, defendants had also sought screenshots of all social media websites used by plaintiff showing all of plaintiff’s posts and messages after the implantation of defendants’ medical device. Magistrate Judge Baker held that this separate request lacked any content limitation and would require plaintiff to turn over “a screen shot of every private message she ever sent to anyone on any topic” after the filter implantation. Id. at *6. Magistrate Judge Baker denied the motion to compel a response with respect to this request.
3. In Oprex Surgery (Baytown), L.P. v. Sonic Automotive Employee Welfare Benefit Plan, 2017 WL 3442373 (5th Cir. Aug. 10, 2017), the Fifth Circuit in a per curiam opinion held that the district court had abused its discretion in dismissing a lawsuit as a sanction for purported noncompliance with discovery orders.
In this litigation regarding medical benefits allegedly due under an employee benefits plan, the district court had dismissed plaintiff’s complaint for failure to comply with two discovery orders. In the first, the district court ordered the parties in July 2016 to exchange relevant documents, including how plaintiff determined its prices. Id. at *2. After plaintiff produced its documents, defendant raised certain issues with the information, but the parties were unable to confer before the next pretrial conference, where plaintiff expressed willingness to supplement its original production. At the conference, the district court warned plaintiff that if it did not provide the requested information, plaintiff would “lose” because it “[has] got to prove the case.”
Following the scheduling conference, the district court issued a separate order in August 2016 directing plaintiff to provide the “program and algorithm” it used to set billable rates for out-of-network services and a spreadsheet of the “co-payments and deductibles paid by the claimants.” Id. at *3. Plaintiff began to collect this information and, after it realized it would take longer than anticipated to comply, filed an unopposed motion for a one-week extension, which the district court granted. With the benefit of the one-week extension, plaintiff produced documents responsive to the court’s order.
One month later, defendant again expressed concerns about plaintiff’s discovery response and requested a status conference with the court. One hour before the scheduled telephone status conference, defendant filed a memorandum detailing the ways it believed plaintiff’s response to the August 2016 order was inadequate. In particular, defendant argued that plaintiff had failed to explain sufficiently its billing rates and to analyze what other out-of-network medical facilities were receiving in reimbursements. For these alleged shortcomings, defendant asked the district court to order plaintiff to comply and impose appropriate sanctions.
During the status conference, plaintiff attempted to explain its billing rates. Id. at *4. The district court expressed dissatisfaction with the explanation and indicated a willingness to dismiss the case. Defendant agreed that dismissal was an appropriate sanction and, without providing plaintiff an opportunity to respond, the district court dismissed the complaint, citing plaintiff’s “recalcitrance” in failing to comply with the discovery orders.
On appeal, the Fifth Circuit held that the district court abused its discretion in dismissing the complaint. Id. at *2. While the district court failed to specify the basis for its ruling, the Fifth Circuit reasoned that the district court acted under Fed. R. Civ. P. 37, which empowers the court to “impose ‘just’ sanctions on parties who disobey a discovery order,” including dismissing the suit in whole or in part. Fed. R. Civ. P. 37(b)(2)(A)(v). Id. at *1. The appeals court noted that dismissal with prejudice as a sanction under Rule 37 is a “draconian remedy” that should be used only “under extreme circumstances.” Id. at *2 (quoting FDIC v. Conner, 20 F.3d 1376, 1380 (5th Cir. 1994)). The Fifth Circuit identified in Conner several factors that must be present before invoking this remedy:
(1) the refusal to comply results from willfulness or bad faith and is accompanied by a clear record of delay or contumacious conduct; (2) the violation must be attributable to the client instead of the attorney; (3) the violating party’s misconduct must substantially prejudice the opposing party’s preparation for trial; and (4) a less drastic sanction would [not] substantially achieve the desired deterrent effect. Id. (quoting Conner, 20 F.3d at 1380-81) (internal quotations omitted).
In this case, the Fifth Circuit noted that the district court failed to make any explicit findings as to the necessary factors and held that the record fell “far short” of what is sufficient to justify dismissal. Sonic, 2017 WL 3442373, at *2. Looking to the Conner factors, the Fifth Circuit noted that it was not apparent that plaintiff had refused to comply with the district court’s discovery orders willfully or in bad faith, even if its responses could have been more “fulsome.” Id. at *4. In addition, there was insufficient evidence that the alleged deficiencies in plaintiff’s discovery responses were attributable to plaintiff (as opposed to plaintiff’s counsel) or that defendant suffered substantial prejudice. Defendant had argued that it was prejudiced by the time and expense required to attend the scheduling conference and status conference but failed to identify any prejudice related to its preparation for trial. Finally, there was no indication in the record before the Fifth Circuit that the district court had considered less drastic sanctions before dismissing the case with prejudice, which the Fifth Circuit noted was a “most severe sanction that we have deemed to be a remedy of last resort.” Id. at *4 (citation omitted). Because none of the Conner factors was present, the Fifth Circuit held that the district court’s decision to dismiss plaintiff’s suit fell “well outside the bounds of its broad discretion in adjudicating discovery matters.” Id. at *5.
4. In Ortega v. Management and Training Corp., 2017 WL 3588818 (D.N.M. Jan. 6, 2017), U.S. Magistrate Judge Stephan M. Vidmar denied a motion to compel the production of ESI in native, electronic format where the documents were stored in the ordinary course of business both electronically and in hard copy.
Plaintiff sent discovery requests to defendant, his former employer, asking for ESI to be produced in the manner in which it was ordinarily kept in the usual course of business. Id. at *1. Defendant produced only hard copy versions of certain documents, and plaintiff filed a motion to compel production of ESI in its native format (that is, electronically) as well. Plaintiffs argued that information kept electronically in “the usual course of business” should be produced electronically. Defendant countered that it produced in hard copy all documents ordinarily kept in hard copy and produced in electronic format all documents ordinarily kept electronically. With respect to documents it ordinarily kept in both formats, however, defendant produced the documents only in hard copy.
In making its decision, the magistrate judge noted that Fed. R. Civ. P. 34 does not require a party to produce documents in multiple formats, nor does it require a party to produce ESI in the form in which it is ordinarily maintained. Rather, the rule requires that the documents be produced in “reasonably usable form.” Id. at *2. Therefore, because the production did not “run afoul” of Fed. R. Civ. P. 34, the court denied the motion to compel but in a footnote encouraged the defendant to make the electronic production if it could be done without incurring “significant expense.” Id. & n. 2.