Andrew B. Turk

Standards governing e-discovery are evolving. Attorneys and courts have struggled to adapt traditional discovery methods to the electronic age. Though there are currently no bright line rules, the author offers practical suggestions regarding electronic document retention.

It is virtually impossible to conduct any business today without the aid of computers.  Computers play an essential role in any significant property management operation.  Rent rolls, lease forms, budgets and accounts receivable are all commonly handled by and stored on computers and computer discs.  Other documents, including employee files, work orders, vendor contracts and more may also be stored electronically.  Even the most mundane of communications, such as e-mails to managers and tenants, often take place only in cyberspace.  Computer files, unlike “hard” or paper files, typically contain documents - perhaps even thousands of documents - that have never been printed or otherwise stored on paper.  Absent special measures, e-mails, correspondence and draft documents, even those thought erased, remain imbedded on computer hard drives, even if not easily accessible.  Indeed, it is just such documents that electronic discovery, more commonly known as e-discovery, is often intended to find.

E-Discovery Is Here To Stay

In recent years, attorneys and courts have struggled to adapt traditional discovery methods to the electronic age.  Questions regarding the duty to preserve evidence relatively simple to answer when the topic is limited to paper, photographs and witness statements, become significantly more complex when electronic media are involved.  Although standards for e-discovery are still being developed one thing is clear - e-mail will never be absolutely private again

Given the prevalence of electronic communications and the increasing likelihood that litigation will lead to their discovery, companies should institute clear policies and procedures for use of e-mail and other electronic communication and information storage media.  One need look no further than recent disclosures of e-mails from governmental agencies to see the negative impact that can result in the careless use of e-mails.  In addition to establishing guidelines for the storage and retention of communications, employees should be given strict guidelines regarding the appropriate use of e-mail.  One seemingly harmless “joke” or complaint about a tenant, employee or vendor may ultimately take center stage in a courtroom.  As in most other business situations, professionalism is the best source of protection.

Litigation Hold

Regardless of any contradictory policies that may be in place, parties confronted with a claim have a duty to institute a “litigation hold” to freeze and preserve relevant information and documents once the threat of a claim or litigation arises.  Any “hold” put in place should encompass not only electronic and hard copy files, but also “back up tapes” and other materials retained by information technology personnel.  Such a hold should be instituted regardless of whether it is requested by the claimant or their attorney.  Parties and their attorneys have an ongoing duty to supervise and monitor document retention and production.

Companies should take reasonable steps to preserve relevant documents and electronic information.  It is important to remember that e-mails, unprinted drafts and electronic memoranda are considered “documents” regardless of whether they were ever committed to paper.  While there is currently no bright line rule, the following list represents a starting point for any document retention program.  When faced with litigation that implicates electronic files, companies, their risk managers and attorneys should:

• Ensure familiarity with relevant document retention policies and data retention “architecture” by:
• speaking with information technology personnel about data backup procedures; and communicating with expected “key players” in the claim to determine the extent of their individual files, their individual information retention policies and otherwise work to understand how they’ store information.

Periodically remind the relevant personnel, including the “key players,” of their duty to preserve electronic and hard-copy documents. Make certain that all backup media which is to be retained is identified and stored in a safe place.  Under certain circumstances, it may be appropriate for counsel to take possession of backup media.

Conclusion

Although electronic discovery will not be an issue in every case, it is one of increasing importance and can no longer be ignored.  The American Bar Association and several federal courts and states have already adopted rules governing electronic discovery.  Thus, it is important to know what, if any, rules apply in each case or jurisdiction.  Until the law is settled, companies and their counsel, whether in-house or otherwise, should exercise caution.  Although the parameters of the duty to retain electronic data are unclear, there can no longer be any doubt that such a duty exists.  Nor can the duty be avoided by a simple mouse click.  As long as computers are an integral part of business, electronic discovery is clearly an issue that is here to stay.

Resources

For more information relating to electronic discovery see:

http://www.uscourts.gov/rules/newrules6.html

http://www.kenwithers.com/

http://www.fjc.gov/

http://www.abanet.org/search/pages/

searchResults.cfm?resultStart=l&searchArea=all&criteria=electronic+discovery&collection=all

http://www.abanetorg/litigation/taskforces/

electronic/home.html

http://www.lexisnexis.com/applieddiscovery/

lawLibrary/courtRules.asp