Court Orders Re-Production of ESI at Producing Party’s Expense Where Vendor’s Processing Error Caused Thousands of Emails to be Separated from Their Attachments

PSEG Power New York, Inc. v. Alberici Constructors, Inc., 2007 WL 2687670 (N.D.N.Y. Sept. 7, 2007)

Magistrate Judge Randolph F. Treece began his memorandum decision and order in this construction litigation with these introductory remarks:

With the rapid and sweeping advent of electronic discovery, the litigation landscape has been radically altered in terms of scope, mechanism, cost, and perplexity.  This landscape may be littered with more casualties than successes and the discovery imbroglio in this case is a prime example of this observation.  For nearly six months, the parties and the Court have been grappling with an electronic discovery monstrosity with the hope that it could be corralled and definitively resolved, thereby obviating the need for motion practice.  Alas, attempts to resolve the issue in lieu of briefs fell woefully beyond the parties’ grasp and, as the last straw, they have set the matter at our feet for appropriate resolution.

The parties’ electronic discovery dispute arose when numerous emails being produced by PSEG were “divorced” from their attachments due to a technical glitch in the software used by PSEG’s e-discovery vendor.  (None of the raw data had been lost, and all 750 gigabytes of unfiltered data remained intact and in its original format.)  Upon discovering the problem, the parties attempted to determine whether a reasonable solution was feasible.  However, it became apparent that remarrying the emails to their attachments would be “formidable and costly.”  A number of potential solutions were attempted, none of which proved successful.

Eventually, defendant moved to compel PSEG to re-produce the emails and their attachments as “married documents,” at PSEG’s expense.  PSEG opposed the motion, contending that defendant was impermissibly seeking a “perfect” or “ideal” production, regardless of expense or benefit.  It argued that a “re-do effort” would be duplicative and entirely unnecessary.  It argued that defendant should bear the cost of any re-production, or, alternatively, defendant could identify those emails necessary to a claim or defense, and PSEG would provide those few documents at no cost to defendant.

The court noted that the issues were several-fold:  (1) was defendant entitled to receive the emails with the related attachments together as opposed to their separated state, lacking coordinated identification with each other; (2) although PSEG had provided these emails and attachments in hard copy albeit not “married,” was PSEG obligated to provide these documents in their original format; and (3) if re-production was required, which party bears the cost of this production?

The court observed that the Federal Rules of Civil Procedure were amended to address electronic discovery, effective December 1, 2006, and commented that the “former rules of discovery engagement are not remarkably different than the amended rules.”  The court found that, under either the former or amended versions of Rule 34, PSEG was obligated to produce its business records “as kept in the regular course of business or in such a manner that [defendant] could readily find a necessary document or two.”  The court stated:  “Clearly these 3000 emails and related attachments were not produced in accordance with this mandate, and, as we now know have caused considerable consternation and agony for both parties, which the revised statute was attempting to avoid.”  The court observed that, normally, one would expect that an email and its attachment would have been kept together in the regular course of business, and the production of said documents would have followed suit.  It continued:

Here, the difficulty has been that there was not sufficient identifying information to match attachments with their respective email.  We accept Alberici’s proffer that it has spent considerable time employing different methodologies to unearth attachments to correspond with the emails it has found to be pertinent.  Attempting to reunite these documents has been nothing short of a donnybrook for Alberici.  It has been frustrated if not completely hamstrung in locating these documents.  Compounding Alberici’s angst is the disadvantage it has been placed in preparing for depositions.  In essence, the first production of emails and attachments has been ineffectual.

The court took guidance from CP Solutions PTE, Ltd. v. General Elec. Co., 2006 WL 1272615 (D. Conn. Feb. 6, 2006), a case in which thousands of emails were produced commingled and separated from their attachments.  It found the case was instructive, if not persuasive in managing this type of discovery dispute, but noted that there were other issues to be addressed.

One issue was the extent to which all 3,000 of the disputed emails were relevant to the case.  It found that defendant had demonstrated that the emails were relevant and germane to the subject matters of the action and specifically to its counterclaims.  The court rejected PSEG’s blanket assertion that some of the emails may not be relevant:

Such a panoptic plea is unpersuasive and unavailing.  As far as we can visualize, Alberici is not requesting to roam around in the shadows of relevancy but has established that these emails and their attachments are pertinent to its claims.

PSEG argued that the peculiarities of the case required “a practical, reasonable, and fair solution.”  The court went on to describe the various attempts the parties had made to resolve the problem, and rejected the alternative measures proposed by PSEG.  It stated:  “We acknowledge that discovery production is rarely perfect or ideal, yet this discovery quagmire created by PSEG’s vendor falls woefully short of comporting with the spirit of Rule 34.”  The court concluded that, “[i]n the total scheme of things, re-production is warranted in this case.”  It then turned to the issue of who would pay for such re-production.

Plaintiff’s e-discovery vendor estimated that the re-production of the emails would cost approximately $206,000, while defendant’s vendor believed the production could be completed in less time and for $37,500.  The court suggested that plaintiff use defendant’s vendor, to save costs, and proposed a comprehensive protective order with features to shield privileged or confidential material from defendant.  However, plaintiff rejected the proposal.

The court went to weigh the considerations set out in the advisory committee notes to Rule 26:

(1) the specificity of the discovery request; (2) the quantity of information available from other and more easily accessed sources; (3) the failure to produce relevant information that seems likely to have existed but is no longer available on more easily accessed sources; (4) the likelihood of finding relevant, responsive information that cannot be obtained from other, more easily accessed sources; (5) predictions as to the importance and usefulness of the further information; (6) the importance of the issues at stake in the litigation; and (7) the parties’ resources.

Balancing these factors, the court concluded that re-production was warranted, and that the burden should remain with plaintiff – the responding party.  It noted that plaintiff was the party who would determine the extent of the expense.  The court described several options available and expressed its opinion that plaintiff would be prudent to use defendant’s vendor as a means of substantially reducing its cost.  The court went on to describe steps that could be taken to ensure plaintiff’s confidentiality concerns were adequately addressed should it opt to use defendant’s vendor, but acknowledged that notwithstanding the court’s opinion on the matter, the choice of vendor rested with the plaintiff.

Summing up, the court concluded:

But for PSEG’s vendor creating this email attachment fiasco, we would not be having this discussion.  Without question, attachments should have been produced with their corresponding emails as such are kept in the usual course of business.  PSEG chose to provide the emails and attachments in this disassembled manner albeit unbeknownst to it at the time of production.  Whether created by a software incompatibility or malfunction, such deficiency does not provide a sufficient excuse from presenting an important aspect of discovery in a convoluted fashion.  And, Alberici should not be resigned to accept a flawed discovery process.