Magistrate Judge's Findings of Fact on ESI Spoliation

On June 28, 2018, Magistrate Judge Jean Rosenbluth issued Findings of Fact related to the Defendants' Motion for an Award of Evidentiary and Monetary Sanctions, based on the Plaintiff's spoliation of electronic evidence in Export-Import Bank of Korea. v. ASI Corp., CV 16-2056-MWF (JPRx), 2018 U.S. Dist. LEXIS 111198 (C.D. Cal. June 28, 2018). At a prior hearing the Court imposed monetary sanctions on the Plaintiff and ordered additional productions, but referred the issue of whether or not evidentiary sanctions should be awarded under Federal Rule of Civil Procedure 37(e) to the District Court.

Shortly after a request from Plaintiff's counsel to preserve relevant ESI , the Plaintiff deleted the hard drives of employees who were implicated in a bribery scandal. Emails sent by these employees were recoverable from a server, but the data on the hard drives was lost. The Court did not find that the Defendants were prejudiced by the deletion of the hard drives. "Plaintiff did search for responsive documents on the computers of the remaining personnel-committee members and did not find any. Thus, the Court cannot find that Defendants were prejudiced by these hard-drive deletions, even if they did take place slightly after Plaintiff's counsel had instructed Defendant ASI to implement a wide-ranging litigation hold." Id. at *7 n.2.

The laptop of one of the employees was wiped after the filing of the Defendants' Answer which referenced this employee. No inventory of the contents of the laptop was prepared before it was wiped.

The Plaintiff failed to disclose the deletion of data as required by the ESI order in the case. It also ignored the order's requirement to disclose its Computer Information Protection Standard policy that required that data on the computers of employees who left be deleted so it could not be recovered. The Plaintiff did not disclose information about the deleted data until after a subsequent court order which was issued after it identified one of the employees as a custodian of relevant information.

The Plaintiff also failed to search for relevant ESI until one year after the Defendants' discovery requests. While their delay in discovery and the hard drive deletions warranted monetary sanctions Judge Rosenbluth concluded that, "the Court has no nonspeculative basis to find that any relevant, material evidence has been lost as a result of Plaintiff's evidence destruction." Id. at *12.

Supreme Court of Oregon: Computer Search Warrants Are Not Digital General Warrrants

On June 28, 2018, the Supreme Court of Oregon issued a decision in State v. Mansor, No. SC S064382, 2018 Ore. LEXIS 522, 363 Ore.185 (Or. June 28, 2018) on the Defendant's challenge under the Oregon Constitution to a warrant issued for a search of his computer. The warrant was issued for an investigation into the circumstances around the death of the defendant's infant son. The defendant's contention that he searched online for information on first aid care before phoning 911 prompted the police to request the warrant. The search showed that the father looked for information on the internet regarding child abuse shortly before his son's death.

The Oregon Court of Appeals ruled that the search violated the particularity requirement of the Oregon Constitution because it permitted the police to search anything on the Defendant's computer. On this basis Mansor's conviction for murder was reversed, and the case was remanded. The Supreme Court in part affirmed the decision of the Court of Appeals. "We acknowledge that, for practical reasons, searches of computers are often comprehensive and therefore are likely to uncover information that goes beyond the probable cause basis for the warrant. In light of that fact, to protect the right to privacy and to avoid permitting the digital equivalent of general warrants, we also hold that Article I, section 9, prevents the state from using evidence found in a computer search unless a valid warrant authorized the search for that particular evidence, or it is admissible under an exception to the warrant requirement." Id. at *4-5.

A forensic search was necessary to find the details of the Defendant's internet search history. Justice Balmer's opinion includes a section entitled, "The Digital Context", which gives a lengthy description of how data is stored on a computer, discussing the recovery of deleted files and how to hide files. He notes that criminal investigations search computers in two phases: a data acquisition phase (the search for the computer itself) and a data reduction phase (the review by the forensic examiner).

Justice Balmer noted that it was advisable to list a specific time range in the affidavit for the warrant, but that this is not a necessary element of the particularity requirement. "To meet the particularity requirement of Article I, section 9, the warrant must identify, as specifically as reasonably possible in the circumstances, the information to be searched for,including, if relevant and available, the time period during which that information was created, accessed, or otherwise used. We emphasize, however, based on our discussion of digital devices and computer searches above that the forensic examination likely will need to examine, at least briefly,some information or data beyond that identified in the warrant ." Id. at 55. Because the warrant specifically stated that a search was to be conducted for internet search history on a particular date, the Supreme Court disagreed with the Court of Appeals that the warrant was facially invalid and overbroad.

The Supreme Court did however find that trial court was wrong to deny the motion to suppress the results of the forensic examination in its entirety. A reasonable search way require a review of information beyond the scope of the warrant. This poses the risk of warrants to search digital evidence becoming general warrants. A targeted search will not invade a person's privacy interest. However evidence from a search for information not identified in the warrant, or the use of information not identified in the warrant, uncovered in the targeted search, cannot be used.

Northern District of Texas Decision on the Taxation of Costs

This past month Magistrate Judge David Horan issued a decision, Gonzales v. Pan Am. Labs., L.L.C. ,No. 3:14-cv-2787-L, 2018 U.S. Dist. LEXIS 88280 (N.D. Tex. May 4, 2018), recommending that the Court grant the Plaintiff's Objection to the Defendants' Bill of Costs and the Motion for the Court to Review/Retax Costs.

The Defendants' Bill of Costs included fees for transcript; printing; service of subpoenas; and almost $6,000 in computer forensic services. Federal Rule of Civil Procedure 54(d) gives a court discretion to award costs to the party that prevails in an action. 28 U.S.C. § 1920 allows a court to tax as costs printing and copying fees, as well as fees for printed or recorded transcripts.

The Court sustained the objection to the transcription costs because the transcripts were not prepared for use in this case. Judge Horan also declined to approve rush fees assessed by a process server. An objection to copying costs was also sustained because the Defendants did not show these costs were incurred to use the copies in litigation and not just for the convenience of the counsel. "[I]n support of their Bill of Costs, Defendants submitted only a bare affidavit that repeats the declaration on the clerk's approved form stating that all of the requested costs were necessarily incurred in this action. See Dkt. No. 56 at 3 of 23. That conclusory assertion alone is not enough, and, without more, the Court cannot determine whether the copies were necessarily obtained for use in the present litigation." Id. at 9.

Judge Horan also recommended that the electronic database services were not covered by 28 U.S.C. § 1920. "Congress did not use language that would have unequivocally intended 'printing' under Section 1920(3) to include electronic data copying and storage." Id. at *16. He also denied a request to tax costs for printing electronically stored documents. Even though copies may be necessary for the process of document production they are not necessarily obtained for use in the litigation. "Defendants' choosing to proactively gather any and all relevant and discoverable materials and copy them onto an electronic database for potential production in discovery —although perhaps efficient, convenient, and cost conscious— does not automatically render the copying of such materials taxable under Section 1920(4) without further explanation." Id. at 23.