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TN Civil Rule 26.02(5) - The "Clawback"
In the world of electronic information, the possibility for massive amounts of information exists in litigation. Even after a diligent review of the information, confidential or privileged information could be inadvertently released. With this possibility, Tennessee Rule 26.02(5) includes a section covering the accidental production of privileged information.
As many will agree, reviewing electronically stored information (ESI) during litigation has its challenges, but also potential advantages. The courts realize that paper and electronic documents are very different. As we have discussed in the past, electronic information contains information that is not immediately obvious, such as metadata. Within the metadata, the unseen information could be privileged or confidential. To complicate matters even more, some versions of Microsoft Word provided the ability to review the previous edits of a document by reversing the "track changes" feature. There have been many instances of crucial information being produced accidentally via metadata. USAToday has a great article describing some high profile "uh-ohs" involving metadata. For more examples, simply go to google and search for "embarrassing metadata". This is where Rule 26.02(5), the "clawback", comes into play. If information deemed privileged is inadvertently produced, the producing party can notify the recipient of this assertion and the basis for it. The requesting party must return, sequester, or destroy the information promptly, and is barred from disclosing it until the claim is resolved.
One of the advantages of ESI over paper is the potential assistance with the review of information. Forensic Discoveries has been involved in matters in which nearly 90,000 electronic documents were produced. While some may choose to review all of this information, some choose to leverage the technology. The same technology that was used to find the information, keyword searching, can also be used to assist in the review for privilege. By developing an applicable keyword list with the search terms that would appropriately flag potential privileged or confidential information, the information produced from the search can be set aside for review. If the comfort level is there, the remaining information can be released.
With the revolution and value of leveraging electronically stored information in litigation, approaching the review aspect requires additional consideration and potential advantages. TN Rule 26.02(5), the "clawback", was designed to address the accidental production of privileged or confidential information to opposing counsel. To potentially assist in the review, an advantage to electronically stored information is the ability to search for search terms that will flag and removed sensitive information from the production.
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Metadata Ethics Opinions Around the U.S.
Metadata is loosely defined as "data about data." More specifically,
the term refers to the embedded stratum of data in electronics file
that may include such information as who authored a document, when it
was created, what software was used, any comments embedded within the
content, and even a record of changes made to the document.
While
metadata is often harmless, it can potentially include sensitive,
confidential, or privileged information. As such, it presents a serious
concern for attorneys charged with maintaining confidentiality -- both
their own and their clients. Professional responsibility committees at
several bar associations around the country have weighed in on
attorneys' ethical responsibilities regarding metadata, but there is no
clear consensus on the major metadata issues. Read more and view the chart here
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Tennessee Passes New Law Forcing Colleges To Police Illegal Downloads
On November 12th, Tennessee passed a new law requiring both public and private colleges in the state to police their computer networks to detect illegal downloads. In an apparent victory for the Recording Industry Association of America (RIAA), the law is aimed at reducing the large number of illegal downloads coming from college campuses. According to a survey, more than half of college students download movies and music illegally. Under the law, universities must implement "technological support and develop and enforce a computer network usage policy to effectively limit the number of unauthorized transmissions of copyrighted works." The Electronic Frontier Foundation (EFF) said the law is ridiculous and would initially cost Tennessee over $9 million to enforce and more than $1.5 million annually thereafter. The EFF also explained that the law will not stop piracy on college campuses because there are other, low cost ways for students to exchange music, utilizing DVDs and USB drives.
The RIAA press release may be found here
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Careless/Disgruntled Employees May Pose Data Breach Threat
On November 20th, Cisco released the third installation of its study on company data security. The third part deals with the "insider threat" to data leaks: company employees who are uninformed, disgruntled, careless, or all of the above. The study indicates that insider threats can be greater than attacks that originate outside the company. Other key findings were that portable hard drives are bigger security concerns than e-mail, and that some employees keep devices with employer data on them even after they leave the company. One of the biggest mistakes is assuming that a disgruntled employee, e.g. one who is fired and steals data to get even, is a bigger threat than a careless employee. A careless employee can be just as bad, e.g. the guy loudly revealing company data while talking on his cell phone, failing to log off a computer, leaving passwords lying around, or worst yet, losing his cell phone, laptop or other electronic device that's unencrypted and void of any password protection. Advice for companies dealing with these issues included education, training and awareness.
The Cisco press release with links to the studies may be found here
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EDiscovery Case Law
Court Holds No Expectation of Privacy on Work Computer Even for "Personal" Information
In this case of first impression in New Jersey, defendant argued
that personal information found on his work computers should be
suppressed because his employer had no authority to consent to the
search. Defendant argued that he, not his employer, owned the
computers and that he therefore had a reasonable expectation of privacy
as to the personal information stored on them. Finding that the
employer, in fact, owned the computers and therefore had every right to
consent to the search, the court denied defendant's motion to suppress.
Defendant
was initially hired by his employer as a part time bookkeeper but was
eventually hired full time and given additional computer
responsibilities because he was "an expert" and maintained a used
computer sales business on the side. Upon being hired, the defendant
was made aware that "the computers or anything else in the office is
company property." Eventually, the defendant sold at least ten
computers to his employer. Among those were the laptop and the desktop
at issue in the case. In addition to his employer's password
protection, the defendant created his own password protected areas on
both computers and used them to store personal information, at least
some of which indicated theft from his employer. When the employer
discovered that the defendant had fraudulently raised his own salary,
the defendant was immediately fired. His employer subsequently
discovered evidence of additional and extensive theft and contacted the
police. The employer provided police with written consent to search
the two computers. On them was found additional evidence of the
defendant's illegal activities.
Defendant argued that he was the true owner of the computers and
that he had a reasonable expectation of privacy on them, especially in
the password protected areas. In support of his contention, the
defendant argued that he had reimbursed the company for the purchase of
the laptop and that he kept it at home three out of five days a week.
As to the desktop, the defendant argued that it had merely been
delivered to his employer's business because no one was available at
the defendant's computer business to sign for it and that he brought it
to work when a temporary intern was using the computer in his office.
Rejecting his arguments as "implausible", the court found ownership
properly resided with the employer in light of several facts,
including, among other things, the employer's payment for the
computers, the placing of the laptop on the depreciation schedule of
the employer's corporate tax returns and the specific instruction to
defendant that all computers were company property. Accordingly, the
court upheld the validity of the warrantless search and denied the
defendant's motion to suppress.
A copy of the full decision is available here
Court Sets E-Discovery Protocol After Parties Cannot Agree
On October 29th, in the U.S. District Court for the District of Columbia, Judge Facciola set his own protocol for Plaintiff's expert's search of Defendants' computer systems after the parties could not agree. Defendants offered a search protocol, but the court rejected it because it was highly restrictive, full of undefined "buzz words," and was "fundamentally misguided" as the limited search was not likely to produce all the electronically stored evidence that Plaintiff legitimately demanded. Judge Facciola then formulated his own search protocol. The protocol laid out what the Plaintiff's expert could search, the time to conduct the search, and found that Defendants' representative could be present during the search. The court also considered Defendants' concern about privileged information, and found that Defendants would have three weeks to go through the search results before the results were given to Plaintiff. Defendants were also ordered to produce a privilege log in compliance with Federal Rule of Civil Procedure 26. Finally, the court determined that Defendants would pay up to $10,000 for the search, and if the search was more expensive, then the court would determine how to allocate costs.
The decision may be found here
Magistrate Judge Recommends Default Judgment For Spoliation
On October 15th, a magistrate judge in the Eastern District of New York recommended the imposition of default judgment against the defendants in a fraud cause due to their intentional spoliation of evidence on a laptop. Defendants' conduct included: visiting a website that provided a computer program to delete files from a computer, downloading (but not using) the deletion program, deleting hundreds of user documents in the days before forensic imaging, deleting files that were labeled as related to the litigation and listed in Defendants' privilege log, reinstalling the operating system on the laptop two days before the forensic imaging, deleting hundreds more files after the operating system was re-installed, and changing timestamps for laptop documents. The court found that it was clear that defendants' intentionally destroyed information from this conduct. The judge recommended default judgment as a sanction and also ordered defendants to pay all plaintiffs' legal costs relating to the discovery dispute over the laptop.
The case is Gutman v. Klein, and it may be found here
CEO compelled to provide personal laptop for forensic analysis
First USA Bank v. PayPal, Inc., 76 Fed.Appx. 935 (Fed.Cir. 2003).
In a patent infringement action, the plaintiff subpoenaed the defendant's former chief executive officer, specifically requesting the court to compel his deposition and to require him to produce his laptop computer for forensic inspection. The former-CEO had used the computer while employed by the defendant and subsequently purchased it from the defendant when he left its employ. Despite objection, the magistrate judge ordered the former-CEO to be available for deposition and approved a search protocol. The search protocol allowed electronic evidence consultants to create a forensic copy of the computer's hard drive, identify any potentially relevant documents, and, if such documents were found
and identified, allow the former-CEO to create a privilege log. The district court affirmed the magistrate's order and former-CEO appealed. The appellate court dismissed the former-CEO's appeal of the lower court's non-final interlocutory discovery order.
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