Case Summaries – Page 255 – Electronic Discovery Law

Supreme Court of Washington Holds Trial Court Did Not Abuse Discretion in Imposing $8,000,000 Default Judgment Pursuant to CR 37 for Defendant’s Willful Discovery Violations

Dec 11 2009

Magaña v. Hyundai Motor Am., 220 P.3d 191 (Wash. 2009)

Plaintiff sustained injuries in an automobile accident that he alleged were caused in part by a defective seat design which allowed the seat to collapse. The case went to trial and plaintiff was awarded $8,000,000. The verdict was reversed on appeal for reasons related to plaintiff’s expert’s testimony and a new trial on the issue of liability was ordered.

Trial Court Violated Attorney-Client Privilege by Ordering In Camera Review

Dec 03 2009

Costco Wholesale Corp. v. Superior Court, S163335 (Cal. Nov. 30, 2009)

In 2000, Costco hired outside counsel to provide legal advice regarding the applicability of certain wage and overtime laws to its warehouse managers. In furtherance of providing such advice, counsel spoke with two managers Costco had made available to her. Thereafter, she provided Costco with a 22-page opinion letter addressing the question at issue. Several years later, plaintiffs in a class action against Costco sought to compel production of the relevant opinion letter arguing that the letter contained unprivileged information and that Costco had placed the contents in issue thereby waiving the privilege.

To resolve the question, the court ordered the letter be reviewed by a discovery referee who subsequently recommended production of the letter with heavy redactions. The referee reasoned that the factual information therein was not privileged and that while interviewing the two managers, the attorney had acted not as an attorney but as a fact finder. The trial court adopted the recommendation and ordered the letter produced. On appeal (and without ruling on the merits of the trial court’s order or its decision to refer the letter to a discovery referee for review), the court affirmed the order reasoning that Costco had failed to establish that the production would cause irreparable harm. The issue was appealed to the Supreme Court of California.

Finding Back-up Tapes “Not Reasonably Accessible” Court Declines to Compel Restoration of All but One Tape; No Sanctions for Deletion of Email Absent Evidence of Duty to Preserve or Showing of Bad Faith

Dec 03 2009

Calixto v. Watson Bowman Acme Corp., 2009 WL 3823390 (S.D. Fla. Nov. 16, 2009)

In this breach of contract litigation, plaintiff filed a motion to compel defendant Watson Bowman Acme Corporation (“WABO”) to “remedy its spoliation of documents” by restoring and searching back-up tapes that potentially contained copies of emails that were deleted. Plaintiff also sought sanctions for the alleged spoliation. The court denied plaintiff’s motion to compel the restoration of all back-up tapes, following its determination that the burden and cost of such restoration rendered the documents not reasonably accessible and upon finding that plaintiff failed to establish good cause for such a search. However, as to a one tape determined to potentially contain the relevant deleted emails, the court granted plaintiff’s motion and ordered the tape be restored and searched. Regarding sanctions, the court denied plaintiff’s motion absent a clear indication of a duty to preserve at the time of the deletion and absent any evidence of bad faith.

Communications with Attorney Using Company Computer and Email Account Not Protected by Attorney-Client Privilege

Dec 01 2009

Alamar Ranch, LLC v. City of Boise, 2009 WL 3669741 (D. Idaho Nov. 2, 2009)

In this case arising from a land use and permitting dispute, the court ruled that emails sent by a non-party to her attorney using her work computer and work-assigned email address were not protected by the attorney-client privilege. In so holding, the court relied in large part upon the existence of company policy which put the employee on notice that her emails were subject to monitoring and were not confidential. Emails sent by the attorney to the employee’s work account were likewise unprotected where the attorney was on notice of the employee’s use of company email and should have recognized the risk that such emails were unprotected. As for emails sent to the attorney by other clients and copied to the employee, the court reasoned that such emails retained their privileged status where the senders (non-employees of the relevant company) were not on notice of the potential exposure of their emails to outside scrutiny.

Schanfield v. Sojitz Corp. of Am., 2009 WL 577659 (S.D.N.Y. Mar. 6, 2009)

Dec 01 2009

Key Insight: Emails sent to co-workers to recruit them as co-plaintiffs not protected by the work product doctrine where plaintiff merely assumed co-workers would keep his communications secret but where court found that sending emails to employees of a corporation increased the likelihood that the material would reach others within the corporation and thus ruled that plaintiff forfeited the protection by using the work product ?in such a way that they may end up in the hands of [his]adversary;? where plaintiff sent emails to attorney family members and copied his non-lawyer sister or another relative, court ruled emails were protected by work product doctrine because material was prepared in anticipation of litigation and sharing with relatives ?did not significantly increase the likelihood that [defendant] would obtain private information?

Nature of Case: Employment discrimination

Electronic Data Involved: Emails

In re Search of Kindhearts for Charitable Humanitarian Dev., 594 F. Supp. 855 (N.D. Ohio 2009)

Dec 01 2009

Key Insight: Finding the restrictions of a protective order preventing defendant?s access to its own electronic materials seized pursuant to a government investigation too onerous and unconstitutional in light of defendants need for access to assist in its defense, and where defendants sought only copies of the material seized such that the originals would remain preserved, court granted defendants motion to vacate or amend the protective order to allow access to the materials but indicated willingness to allow government to justify certain restrictions based on a showing of substantial need

Nature of Case: Challenge to governmental freeze on charity’s assets and seizure of documents and other tangible items pursuant to executive order

Electronic Data Involved: Copies of seized ESI

Technical Sales Assocs., Inc. v. Ohio Star Forge Co., 2009 WL 1212809 (E.D. Mich. May 1, 2009)

Dec 01 2009

Key Insight: Where forensic examiner revealed evidence of defendants? data deletion to plaintiffs while bound by stipulated order requiring results of the examination to be reported to defendants first, but where the court found the stipulated order was focused on the discovery of actual data rather than the lack of data and that the examiner was therefore not in violation of the order, court reserved ruling on examiner?s motion for attorney?s fees stating that while the examiner?s actions did not rise to the level of contempt, they were not free from taint and that such actions ?[gave] the Court pause about granting [the examiner?s] motion

Nature of Case: Dispute over sales commissions

Electronic Data Involved: Email, ESI

Innis Arden Golf Club v. Pitney Bowes, Inc., 257 F.R.D. 334 (D. Conn. 2009)

Dec 01 2009

Key Insight: Where consulting firm retained by plaintiff destroyed soil samples and related electronic data absent implementation of a litigation hold and where plaintiff was obligated to preserve such evidence in light of the possibility of litigation and its knowledge of the evidence?s relevance to that litigation, court attributed the consulting firm?s destruction of the samples and data to plaintiff based upon ?the close ties? between them and imposed a sanction precluding the admission of evidence based on the destroyed evidence; court found that defendant?s failure to conduct its own testing upon notice of impending remediation to the relevant property did not constitute a disclaimer of defendant?s interest in plaintiff?s pre-remediation soil samples, especially where remediation destroyed defendant?s ability to verify plaintiff?s testing results or conduct additional tests and where defendant was not aware that the existing data in plaintiff?s possession would be destroyed

Nature of Case: Cost recovery action

Electronic Data Involved: Soil samples and related electronic data

Panos v. Timco Engine Ctr., Inc., 2009 WL 1658416 (N.C. Ct. App. June 16, 2009)

Dec 01 2009

Key Insight: Appellate court affirmed trial court?s grant of summary judgment to plaintiff despite defendant?s accusations of spoliation and request for an adverse inference instruction where precedent established that the imposition of an adverse inference was permissive and not mandatory and that it was improper to base the grant or denial of summary judgment on evidence of spoliation, among other principles of law, and where defendant failed to identify any information destroyed by plaintiff that could support it?s claims and presented no independent evidence in support of its claims or alleged damages

Nature of Case: Misappropriation of trade secrets

Electronic Data Involved: ESI

Clarke v. J.P. Morgan Chase & Co., 2009 WL 1838995 (S.D.N.Y. June 22, 2009)

Dec 01 2009

Key Insight: Court upheld prior determination that email withheld as protected by attorney-client privilege should be produced where review of the email and affidavits of defendant?s employees showed that ?rather than having been asked to make a recommendation, in-house counsel had been charged with making a corporate decision as to whether certain jobs would be reclassified? and that the email informed the recipients of that decision and did not provide legal advice

Nature of Case: Class action alleging violations of Fair Labor Standards Act

Electronic Data Involved: Email

Catagory:Case Summaries