A CEO, a Judge and a Few Attorneys Chat About the FRCP Revisions…..

Practical implications of the recent revisions to the FRCP Rules 26(b)(1) (incorporating proportionality) and 37(e) (failure to preserve)

by Howard Reissner, Esq.

I’ve had many conversations on the newly enacted rule revisions with several defense attorneys, a leading plaintiff’s attorney and a Federal Judge. Each of them had differing thoughts on how these amendments would impact Information Governance re: preservation of data and on the broader scope of Discovery in general.

The new focus on proportionality in Rule 26 was encouraged by the Defense Bar to limit what they perceived as the often broad based, unfocused discovery requests in “asymmetrical” litigation, where a Plaintiff with limited resources could force the larger Defendant to settle the case rather than expend large dollars on the gathering and review of expansive quantities of data. The practical application from the Plaintiff’s point of view is that going forward they must have greater knowledge of the Defendant’s potential sources of responsive data at the outset of the case so as to avoid the claim that the discovery requests are not proportionate to the value of the case, the resources of the parties, and the issues at stake.

The concept of “duty to preserve” addressed in the changes to Rule 37 (e) has received a substantial amount of attention and comment. The basic premise behind the Amendment to this rule is that there would be more clarity to corporations on the issue, allowing voluminous quantities of data to be removed from preservation without fear of sanctions. The Federal Judge was of the opinion that if management and retention policies were properly designed and implemented, it would in fact reduce the risk of possible negative consequences for eliminating data that could someday become responsive to a discovery request. He does feel that there will be varying interpretations of the meaning of “intent” as the trigger for when sanctions may be imposed for failure to preserve.

Several defense attorneys felt that the concept of “reasonable steps” taken to preserve data would be dependent on the sophistication of the party and their resources, especially as data sources from social media and mobile devices continue to proliferate.

As a service provider, we have seen an explosion in the volume and disparate sources of data creation and storage. It is imperative that business entities implement and maintain Information Management systems and policies that are fully defensible under the standard of “reasonableness”.

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