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Kucala
Enterprises, Ltd. v. Auto Wax Co., Inc., 2003
WL 21230605 (N.D.Ill.), May 27, 2003
A recently
reported case, Kucala Enterprises, Ltd. v. Auto
Wax Co., Inc., 2003 WL 21230605 (N.D.Ill.), May
27, 2003, highlights the disastrous results that
can befall a litigant that uses a wiping program
such as Evidence Eliminator. In this patent
infringement case in federal court in Illinois,
the district court, in response to a discovery
request by the defendant, had ordered the inspection
of a computer used by the plaintiff. The
defendant then hired an experienced forensic investigator
to use EnCase to create a forensic image and analyze
the plaintiff's computer. On February 28th
the investigator imaged the subject computer.
His analysis revealed that the plaintiff had employed
Evidence Eliminator on his computer between midnight
and 4 a.m. on February 28th to delete and overwrite
over 12,000 files, and that an additional 3,000
files had been deleted and overwritten three days
earlier. In addressing the proprietary of the
plaintiff's use of Evidence Eliminator, the Court
stated "Any reasonable person can deduce,
if not from the name of the product itself, then
by reading the website, that Evidence Eliminator
is a product used to circumvent discovery. Especially
telling is that the product claims to be able
to defeat EnCase ..." (emphasis added). The
Court described the plaintiff's actions as "egregious
conduct" that was wholly unreasonable, and
found the plaintiff at fault for not preserving
evidence that it had a duty to maintain. As
a result, the Magistrate Judge recommended to
the district court that the plaintiff's case be
dismissed with prejudice, and that the plaintiff
be ordered to pay the defendant's attorney fees
and costs incurred with respect to the issue of
sanctions.
(Case
summary courtesy of Guidance Software, Inc.)
Antioch
Co. v. Scrapbook Borders, Inc., 210 F.R.D. 645 (D. Minn. 2002).
Antioch
brought an action for copyright infringement concerning
decorative stickers. Antioch moved for an order
for preservation of records to compel discovery,
to expedite discovery, and to appoint a neutral
computer forensics expert all based upon the belief
that defendants have or would destroy relevant
documents and materials. Defendants
did not oppose the order for preservation of documents
claiming they had no intention of destroying any
relevant materials. Antioch provided a computer
expert who testified through affidavit that data
deleted from computers is retained on the hard
drive but is constantly being overwritten by new
data through normal use of the computer. The
court reviewed the processes described in Playboy
Enter. v. Welles and
Simon Property Group v. mySimon
and designed a process by which a computer forensics
expert would create a mirror image and work with
the parties to provide the relevant information.
GTFM,
Inc. v. Wal-Mart Stores, Inc., 2000 U.S. Dist. LEXIS 16244, 2000 WL 335558 (S.D.N.Y.).
GTFM
sought transactional documents from Wal-Mart in
this trademark infringement case. Wal-Mart's
counsel responded that it did not have the centralized
computer capabilities to track the purchase and
sale of goods for a particular period of time.
Plaintiffs then attempted to discover the
information through other sources. Approximately
one year later, GTFM deposed a Wal-Mart vice president
who revealed that Wal-Mart's computers did in
fact have the capability to track the purchase
and sale of goods. The court held that counsel
for Wal-Mart had a duty to find the person within
the organization who had knowledge of the computer
capabilities and held that Wal-Mart had misrepresented
its computer capacity. The court ordered
defendant to pay all of plaintiffs' attorneys'
fees and costs unnecessarily expended due to the
failure to disclose accurate information.
In
re Bristol-Myers Squibb,
205 F.R.D. 437 (D.N.J. 2002).
The
court emphasizes the importance of the Federal
Rules Civil Procedure 26 meeting and the Rule
16 conference to anticipate and to prevent problems
related to electronic discovery. The court
learned that class plaintiffs agreed to pay for
paper copies of documents that, unbeknownst, the
plaintiffs had stored electronically and could
have been produced inexpensively in electronic
format. The responding party entered many
documents into a litigation software program and
then printed hard copies for plaintiffs in an
attempt to get plaintiffs to pay the bill.
In
re DoubleClick Inc. Privacy Litigation, 154 F. Supp. 2d 497, (S.D.N.Y. 2001).
Plaintiff
class members brought this case against DoubleClick,
the largest provider of Internet advertising products,
based on DoubleClicks' targeting Internet users
for banner advertisements. Based upon personal
information it gathered without the knowledge
of the Internet users, class members brought this
action under Electronic Communications Privacy
Act, 18 U.S.C. § 2701; the Federal Wiretap
Act, 18 U.S.C. § 2510; and the Computer Fraud
and Abuse Act, 18 U.S.C. § 1030. The court
held that class members did not have a cause of
action under any of these federal acts.
Furthermore, it declined to exercise supplemental
jurisdiction over the state claims.
Linnen
v. A.H. Robins Co., 1999
WL 462015 (Mass. Super. Ct. 1999).
Linnen
is one of the first pharmaceutical products liability
cases. In Linnen, the plaintiffs went to
the court ex parte and acquired a document preservation
order. After it was served on the defendants,
the defendants waited for some period of time
prior to stopping the recycling of their backup
tapes. During discovery, defendants balked
at the request to restore many of the backup tapes
to search for responsive information. The
court ordered the defendants to restore the backup
tapes and search. Further, it ordered that
a "spoliation inference" would be given,
that is, that the jury be instructed that an adverse
inference may be drawn from the fact the documents
were destroyed by the defendants.
New
York State Nat'l Org. for Women v. Cuomo,1998
U.S. Dist. LEXIS 10520, 1998 WL 395320
(S.D.N.Y.).
The
court instructed attorneys that they may not take
the obligation to preserve records cavalierly
but that they have a duty to advise their clients
of pending litigation and of the requirements
to preserve potentially relevant evidence, including
electronic evidence. Clients cannot be expected
to know all litigation that may be pending and,
therefore, it devolves to the attorney to inform
the client of the obligation once it arises.
Playboy
Enter. v. Welles, 60
F. Supp. 2d 1050 (S.D. Cal. 1999).
The
court first noted that by requesting "documents"
under the Rules of Civil Procedure the requestor
automatically requests electronic evidence. Based
upon testimony that emails had been created that
might be relevant, the court determined that the
burden upon Welles was outweighed by the need
for the requested information and, therefore,
that the requesting party would be allowed to
find an expert to image the hard drive. The
court would provide a protective order for the
expert to sign and the information would only
be provided to the producing party. The
producing party would then review the material
and produce anything responsive and non-privileged
for the requesting party.
Residential
Funding Corp. v. DeGeorge Financial Corp., 306
F. 3d 99 (2nd Cir. 2002).
The
trial court held that the delay in providing electronic
records by Residential Funding was not done in
bad faith or with gross negligence and, therefore,
that an adverse inference instruction would not
be given. The Second Circuit vacated and
remanded because it found that the wrong standard
had been used. The Second Circuit instructed
the trial courts that an adverse inference instruction
could be imposed when discovery was delayed by
ordinary negligence and that a finding of gross
negligence or bad faith was not necessary.
Rowe
Entertainment, Inc. v. Wm. Morris Agency, Inc.,
205 F.R.D. 421 (S.D.N.Y. 2002).
The
Southern District of New York defined eight factors
to consider when allocating costs of electronic
discovery. Those factors are: specificity
of the discovery requests; likelihood of discovering
critical information; availability of such information
from other sources; purposes for which the responding
party maintains the requested data; relative benefit
of the information to the requesting party; total
cost associated with production; relative ability
of each party to control cost; and, resources
available to each party.
Sattar
v. Motorola, Inc., 138
F.3d 1164 (7th Cir. 1998).
The
court required Motorola to loan proprietary software
to the requesting party or to allow that party
access to Motorola's computer system to view the
data. In an effort to encourage the parties to
work out any problems, the court ordered them
to share the costs of printing 210,000 pages unless
they could create a better solution.
Simon
Property Group L.P. v. mySimon, Inc., 194 F.R.D. 639 (S.D. Ind. 2000).
The
courts sets forth a process for discovery by which
an expert from Computer Forensics, Inc.™
was chosen to inspect computers. The expert
was designated as an officer of the court and
asked to search the data on the computers and
provide a report to the court. The court,
in turn, provided the report to the responding
party to identify responsive and non-privileged
documents and to create a privilege log and produce
that material to the requesting party. The
expert was asked to destroy any materials held
in evidence at the conclusion of the case.
White
v. Office of the Public Defender for the State
of Maryland, 170 F.R.D. 138 (D. Md. 1997).
An
attorney formerly employed by the Maryland Public
Defender sued for racial discrimination. The
court found three bases for imposing sanctions
on the plaintiff for destruction of a diary that
she called a manuscript autobiography. It considered
Rule 3.4(a) of the Rules of Professional Conduct,
Rule 37 of the Rules of Civil Procedure and the
court's inherent authority. The court
went through a two-step process. First,
it considered five elements: the act of destruction;
the discoverability of the destroyed evidence;
the intent to destroy; the timing (that is, if
the destruction occurred after litigation began
or was contemplated); and the prejudice to the
other party. The court held that based
upon all of these factors, sanctions were appropriate
against the plaintiff, the destroying party.
Zubulake
v. UBS Warburg LLC, 02
Civ. 1243 S.D.N.Y. (May 13, 2003).
The
court provides a detailed analysis of the different
types of data available for discovery and determines
that the proper question is the accessibility
of data rather than the media it may be stored
on or the reason for its creation. The
court rejects two of the Rowe Entertainment factors
and creates seven factors to determine whether
cost shifting should occur. First,
it determines that the default answer is that
there should be no cost shifting. Second,
if the question is data in an accessible place,
there should be no cost shifting. If
the data is difficult to access, the new seven
factors should be applied although not weighed
equally. However, prior to the analysis,
the court wants the responding party to restore
and produce responsive documents from a small
sample to assist in the fact intensive analysis.
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