Supreme Court of Tennessee Adopts Rule 34 Specificity Amendment

Earlier this month, the Supreme Court of Tennessee issued an order adopting amendments to the Tennessee Rules of Civil Procedure. See, In re Amendments to the Tenn. Rules of Civil Procedure, No. ADM2018-01575, 2019 Tenn. LEXIS 3 (Tenn. Jan. 8, 2019). The Tennessee General Assembly (its Senate and House of Representatives) must still approve the amendments.

In addition to changes to Rule 4, addressing the service of defendants, the Supreme Court has approved an amendment to Rule 34.02, which concerns document productions.

"The response shall state, with respect to each item or category, that inspection and related activities will be permitted as requested, unless the request is objected to, including an objection to the requested form or forms for producing electronically stored information, stating with specificity the grounds and reasons for objecting to the request. If objection is made to part of an item or category, the part shall be specified. An objection must state whether any responsive materials are being withheld on the basis of that objection."

The inserted language is underlined and boldfaced. This mirrors the amendments to Federal Rules of Civil Procedure in December 2015. The first added phrase is nearly the same wording as the amended version of Fed. R. Civ. P. 34(b)(2)(B): ". . . with specificity the grounds for objecting to the request, including the reasons." The second added phrase is identical to that used in Fed. R. Civ. P. 34(b)(2)(C).

The Advisory Commission's Comment to the amendment states that it is intended to make clear that boilerplate objections are improper. The reasons for objections are to be stated to, "facilitat[e] the resolution of discovery disputes without the need for judicial intervention." 2019 Tenn. LEXIS 3, at *11. If objections are made to overbroad requests, parties must specify if they are made in whole or in part, and produce materials which are not covered by the objection. "For any such objection or response that covers only a part of the request, it should be clear from the response that production is being limited to documents or electronically-stored information covering the specifically identified time period or sources for which the responding party has no objection." Id. at *12. The comment goes on to note that while it will not be necessary to submit a log of withheld documents, a party must give an adequate enough description of them to facilitate an informed discussion of the reasons for the withholding.

S.D. Tex. Awards Sanctions for Failure to Disclose Information About Related Suit

Last Thursday, Judge Gray H. Miller, issued a decision, Garcia v. Vasilia, No. H-17-1601, 2019 U.S. Dist. LEXIS 4371(S.D. Tex. Jan. 10, 2019), granting in part the Plaintffs' motion for sanctions against the MidCap Defendants. This is a FLSA suit brought by drivers for their failure to receive pay when the MidCap Defendants acquired their employer, Graebel Companies, Inc.. A motion for dismiss for lack of personal jurisdiction was granted for one of the MidCap Defendants, but not the other.

The Plaintiffs say that the MidCap Defendants failed to disclose a settlement agreement between themselves, and the owners of the Graebel businesses pursuant to a suit filled in Dallas County. They allege that the settlement should have been taken into consideration by the Court when ruling on the motion to dismiss. The MidCap Defendants contend that the Plaintiffs'discovery requests were overboard. They disclosed that they did not search for or review all electronic communications. The documents the Plaintiffs state should have been disclosed were outside of the electronic discovery agreement signed by the parties. The same lawyers representing the MidCap entities in this case, also represented them in the action in which a settlement was reached. The Plaintiffs sought sanctions under Fed. R. Civ. P. 26(g), which requires attorneys to sign responses to discovery requests attesting to their having made a reasonable inquiry for discoverable materials, and under the Court's inherent authority. Sanctions are usually awarded when an attorney has acted in bad faith.

Judge Miller issued sanctions against the MidCap Defendants for failing to disclose information about the other case. "While the court understands MidCap Funding's argument that electronic documents relating to the Dallas Lawsuit may not have been captured with the search terms in the e-discovery agreement, the Dallas Lawsuit is evidence of contacts with the state, the MidCap Defendants' lawyers were clearly aware of the Dallas Lawsuit, and it should have been disclosed to Plaintiffs during jurisdictional discovery whether documents relating to the lawsuit came up when the search terms were entered or not." Id. at *11. However he declined to grant the Plaintiffs' request that he assert personal jurisdiction over the previously dismissed MidCap Defendant as a form of sanction. He also rejected their request to toll the statute of limitations for plaintiffs who had not yet joined the suit. The Plaintiffs were only awarded attorneys fees charged in connection with the motion for sanctions, and part of the fees for the motion to dismiss.

Massachusetts Superior Court Rejects Equifax's Protective Order in Data Breach Case

In November the Superior Court of Massachusetts issued a decision, Commonwealth v. Equifax, Inc., No. 1784-CV-3009 BLS2, 2018 Mass. Super. LEXIS 547 (Nov. 28, 2018), denying the Defendant's Motion for a Protective Order. In this case, the Massachusetts Attorney General sued Equifax on behalf of citizens of the Commonwealth whose personal data was disclosed in a data breach. The Commonwealth alleged that adequate measures were not taken to protect the data, and customers were not informed about the breach quickly enough. Equifax moved for a protective order to prevent the production of information about its cyber-security program, which it claims was necessary to prevent another data breach. Judge Janet L. Sanders found that the restrictions of the proposed order would restrict the Commonwealth's ability to prosecute a complex case. Equifax did not show good cause existed for the protective order where the data would be given to a law enforcement agency that regularly handles sensitive data.

Equifax's protective order would have imposed five conditions, and Judge Sanders rejected each of them:

1. Certain materials were to be reviewed only in a virtual data room, where the Commonwealth was not to take notes or prepare or download summaries of the data. The Court found the restriction on note taking and summarizing information to be an undue burden on the Commonwealth.

2. Equifax sought to impose two confidentiality categories: 'Confidential Secure Documents' and a more restrictive 'Confidential Secure Data'. Judge Sanders ruled that this would allow the Defendant to over designate data with the more restrictive confidentiality status. Documents of special concern can be addressed on a case by case basis.

3. Equifax also wanted to require the Commonwealth to get its permission for copies of documents in the virtual data room, and allow it to redact those documents. Judge Sanders found that, "[r]equiring the Commonwealth to alert Equifax to which documents it views as important also intrudes on the work product privilege." Id. at *5. She pointed out the Attorney General's office kept scanned documents on encrypted computers.

4. The proposed protective order would have limited access to confidential secure materials to the two attorneys who have entered appearances in this case. Judge Sanders rejected this condition because it would impose a burden on the Commonwealth to work without the assistance of staff members that would not be shared by the law firm representing Equifax.

5. Confidential Secure data was not to be produced in its native form. Equifax argued that native files were not needed in a case about a failure to notify about a data breach. Judge Sanders observed this argument construed the Commonwealth's claims too narrowly, and no saw no basis to withhold native files. "[T]he rules require that documents be produced in native form—and for good reason. In such a format, they are searchable and the viewer has access to metadata." Id. at *7.

The Court adopted a modified protective order proposed by the Commonwealth.