Electronic Discovery Institute Class 30: eDiscovery Challenges in Specific Practice Areas: Antitrust

Here's a continuation of my postings about the Electronic Discovery Institute's online e-discovery certification program, that you can subscribe to for just $1. I last blogged about this program on August 19, 2018. Go to https://www.lawinstitute.org/ to sign up for it.

The course entitled, eDiscovery Challenges in Specific Practice Areas: Antitrust, is taught by Robert Keeling, a partner with Sidley Austin; Dave Shonka, a partner with Redgrave LLP; and Rishi Chhatwal, a senior legal counsel for AT&T.

What is Antitrust?

Antitrust Law is a way for the government to act against anti-competitive and anti-consumer business practices.

Criminal vs. Civil vs. Regulatory Antitrust Criminal antitrust law is conduct based. Civil actions may be brought against companies or a whole industry. The regulatory filing is the merger notification filing under the Hart-Scott-Rodino Act.

Price fixing is an example of a particularly egregious and criminal activity. The focus is often on mergers and acquisitions and possible collusive conduct.

Hart-Scott-Rodino Act

The Pre-Merger Notification Act was codified as part of the Clayton Act. The DOJ and the FTC must receive notices in advance of mergers. These government agencies may request data from the companies contemplating a merger. The companies cannot complete the merger until the agencies have decided if they want to challenge it.

The Merger Process

A HSR form is filed as part of pre-merger notification. The companies must describe why the merger is advantageous for them. The form is filed with both the DOJ and the FTC, which have 30 days to respond. They may choose to close their investigation, or issue a voluntary access letter or a second request subpoena which will request additional documentation about the merger. This request may take between 30 and 180 days.

Either the FTC or the DOJ may choose to pursue an investigation. The agencies may interview customers and competitors about the investigation.

Data Volumes in Antitrust eDiscovery

An antitrust case requires that a company's actions have an effect on competition in a market. Huge volumes of data may be reviewed. There will be a wide range of requests pursuant to the HSR Second Request. They are typically very broad and cut across departments. They will not just involve email or network data, but will also concern information from databases. Company databases are often designed for corporate reasons. They are not necessarily designed to facilitate the export of data.

Scope of Discovery in a Second Request vs. Civil Litigation The scope and length of a HSR second request varies greatly from those for discovery requests in civil litigation. The new FRCP rules limit discovery based on proportionality concerns. HSR second requests may be more burdensome. Whereas as in civil litigation discovery can last a year or more, in HSR second requests productions may have to be made in only 30 days.

Sales data, bid data, and customer data have to be collected and produced to the DOJ and FTC in forms which these agencies can review. In civil litigation, discovery deadlines are often extended. This is less likely in investigations conducted pursuant to antitrust law.

Useful Technologies for Antitrust eDiscovery The volume of data is usually so high that it necessitates the use of variety of tools. Data should be clustered into groups and email threading should be performed to avoid unnecessary review by contract attorneys of the same emails.

Technology Assisted Review is often employed in antitrust investigations. The DOJ and FTC are comfortable with the use of predictive coding. It allows companies to reduce the amount of data that they need to review.

Cross-Border eDiscovery in Antitrust Cases A U.S. based company may have relevant data on servers located in foreign countries. Sales data may have customer information that is covered by data privacy laws of the European Union. Blocking statutes and data privacy statues may prevent the transfer of data.

A multinational corporation may store data on cloud servers in several different locations. Structured data may be difficult to produce because it may contain a lot of personal data.

Early Case Assessment in Antitrust Cases

When responding to second requests, it's important to use ECA tools. A company must be able to quickly assess the type of data that it has, and see up front if there are any issues that needs to address. A company considering entering into a merger should use ECA tools to evaluate their potential exposure. It's important to quickly find harmful documents that may complicate the approval of data.

Challenges of DOJ & FTC Antitrust Requests The DOJ and FTC are very savvy about electronic discovery. They will understand the kind of data that is most helpful for their review. They will expect to receive instant messaging data and sales data. The DOJ antitrust division is particularly sophisticated. It employs experts in electronic discovery.

Model Second Request

The DOJ and FTC have posted model Second Requests on their web sites. Parties can use these guidelines to anticipate the types of requests that they will receive. The DOJ will typically ask for organizational charts and sales data over 2 or 3 years. The model is not specific to a particular industry. It is not necessarily a good idea to rely on the models. The guidelines limit the number of documents in any one volume to 100,000.

The Duty to Preserve in Antitrust Cases

The trigger for the duty to preserve is difficult to determine because most contemplated mergers never actually move forward Even for those mergers that do actually occur, second requests are often not necessary. It hard to identify which mergers will be executed and which of those will lead to an investigation. It's possible that after a HSR form is filed, a merger will be given early approval. It may not be necessary to preserve data until a second request is made. Best practices may be industry specific. The standard requirement for preservation is still when litigation is reasonably foreseeable.

Antitrust Case Law In re Intel Corp. Microprocessor Antitrust Litig, 258 F.R.D. 280 (D. Del. 2008) is a landmark case that addressed the preservation of data for antitrust cases. Intel did not turn off automatic systems for the deletion of data and did not have perfect compliance by custodians to data requests. Opposing counsel attempted to obtain Intel's custodial interviews and the court allowed the disclosure of certain information from these interviews.

It's important to determine who the key custodians are and that they follow instructions for the preservation of data. There should documentation to support the fact that the preservation takes place.

In re Delta/Airtran Baggage Fee Anti-Trust Litig., 770 F. Supp. 2d 1299 (N.D. Ga. 2011) addressed when preservation duties arose in response to a request from the government. Delta failed to pull data from back-up drives but the court declined to impose spoliation sanctions.

Preservation of Mobile Devices in Antitrust Cases Mobile devices present unique challenges. A company with a BYOD policy will not actually possess the devices from which data must be collected. Data may be accessed through apps which store data in the Cloud.

Private Antitrust Suits

After a government investigation has closed, a company may still face the threat of private litigation. Preservation may necessary until the statute of limitations has run. Private litigants may request all documents produced to the DOJ or FTC. Third parties who get requests in CIDs (civil investigation demands) may have data subject to these requests that will have to be preserved for future litigation.

Joint-Defense Groups

A joint defense agreement may be advisable when two companies contemplating a merger have a unity of interest. Their counsel can share information and better prepare the defenses that need to be made. It's important to confirm that both companies' data support the new efficiencies expected by their mergers.

The Role of Service Providers in Antitrust Cases

Service providers can ensure that data is reviewed in an efficient manner and produced correctly. In an antitrust investigation the location of an ediscovery vendor may be an important consideration. It's important to be able to meet with vendors very quickly given the tight deadlines.

Production Format Requirements

Second requests are almost always accompanied with instructions for production and how the investigating agencies are to receive data. The agencies are usually prepared to discuss the format with the producing parties. Second request have production format requirements which can be burdensome for ediscovery vendors. It may be necessary to normalize time zones. The DOJ tends to be more reasonable than a private party would be.

The Burdens of Antitrust

An enormous amount of time must be invested by company employees to obtain data. The DOJ will have specific questions for individual custodians. The business of the company may have to be put on hold while the merger investigation takes place. For every day that a merger investigation is not completed, the savings from the efficiencies that a merger will create are postponed.

Electronic Discovery Institute Class 29: eDiscovery Challenges in Specific Practice Areas: Employmen

Here's a continuation of my postings about the Electronic Discovery Institute's online e-discovery certification program, that you can subscribe to for just $1. I last blogged about this program on August 12, 2018. Go to https://www.lawinstitute.org/ to sign up for it.

The course entitled, eDiscovery Challenges in Specific Practice Areas: Employment, is taught by Paul Weiner, eDiscovery Counsel for Littler Mendelson; Ron Peppe, a vice president for legal and human resources at Canam Steel Corporation; and Aaron Crews, senior associate general counsel and global head of eDiscovery at Walmart.

Employment Law & eDiscovery Employment law cases may be large class action suits, or suits by individual employees. Discrimination and harassment suits are common. Suits regarding trade secrets are also common. Employment law cases make up 10-15% of the federal docket. Employment claims include those for wages or those concerning non-compete clauses. Private Attorney General Acts (PAGA) allow employees to recover civil fines on behalf of themselves and other employees. It's worth noting that the landmark electronic discovery Zubulake decisions were made in an employment law case.

Some companies require employers to wear fitness trackers which present unique electronic discovery challenges. Employees will often make use of their own electronic devices which also presents unusual problems for electronic discovery. eDiscovery is a two way street. The focus should not only be on the defendant companies. Plaintiff employees may also control large amounts of significant data and these individuals have the same discovery obligations. The Apple iPhone was not introduced at the time of the amendments to the Federal Rules of Civil Procedure in 2006. The use of social media sites like Facebook, Twitter, and YouTube has grown exponentially over the past decade. The number of text messages sent each day is equal to the total number of people on earth. The number of internet connected devices may reach 50 billion in 2020.

Statements and images posted to social media may contradict the contentions made in employment law suits.

Plaintiff's Perspective The plaintiffs in employment law suits tend to be in the position of asking for data and may not hold large amounts of the data themselves. The will be in the position of making asymmetrical requests. However employers may make requests to preserve and produce social media data. The plaintiffs usually anticipate litigation before their employers and hence will have an obligation to preserve data earlier.

Plaintiff's counsel cannot rely on their individual client's claims about data preservation. As data custodians they will have a vested interest in the outcome of the case. A lawyer's obligation to advise an individual about data preservation duties will be heightened with plaintiff employees.

Data Sources & Technology There has a been a proliferation of data sources devices in recent years. It may be difficult to identify the data that is actually at issue in a case. The data may be ephemeral and present preservation problems. The 2015 amendments to the Federal Rules of Civil Procedure addressed the importance of proportional discovery. Discovery may be limited according to the amount at issue in a case. Even in a case with a large amount in controversy, the potential value of certain evidence may be outweighed by the cost of producing it. Under FRCP 26(b) it may be burdensome to review and produce marginally relevant data.

"Bring Your Own Device"

Companies have implemented BYOD policies as way to save money, and also in response to employees' desire to use their own smartphones. BYOD policies mean that the individuals own the data saved on these devices. If the stakes are high enough, employees will be inclined to reject employer's request for the data on personal devices. Some employees try to control how their employees will use these devices and limit their access to company servers to specific time periods. Devices should be less frequently used as 'data containers' and more often as 'data portals'. Devices are becoming less likely to contain data not saved elsewhere.

Structured & Unstructured Data Queries can be run on structured data more easily than unstructured data. Sharepoint is an example of unstructured data. Time and attendance records, salary information, door scans tend to be saved as structured data.

Companies always have data in a variety of formats. It is not easy to run reports on data stored in proprietary systems.

Class Action Lawsuits

Class action suits tend to involve a large amount of data in different locations. It will take a lot of work to collect the data There may be thousands of individual plaintiffs. Rule 23 class action is a usually an opt out case - individual plaintiffs may affirmatively opt out. Other types of class actions may allow plaintiffs to opt in to the case. The first phase of a class action will determine whether or not the case is appropriate for a class action in the first place. The second phase will be merits related discovery and will only proceed if a court has first certified a class. Pre-certification discovery may be limited to certification related discovery. Merits related discovery may only proceed if the class is certified.

Under FRE 502(d) and FRE 502(e) a clawback agreement can be drafted to allow for the return of inadvertently produced privileged documents. Such an agreement may preclude the consideration of the adequacy of the review for the production and how long a party waited to request the return of the privileged data.

Large companies are required by federal and state law to protect the data of their employees. They will often engage in information security audits. Protective orders should include basic information security provisions. Most eDiscovery vendors have sophisticated information security measures.

The Scope of Discovery Requesting anything related to the employment of an individual may lead to a large data dump. Courts generally don't allow fishing expeditions, but they may give plaintiffs a lot of leeway in employment law cases.

The Future of Employment Law

Companies don't often think of the challenges involved in retrieving data from cloud storage for employment law cases. It may not be advisable to retain the data held by dismissed employees. There should be an increased emphasis on proportionality in determining what data needs to be preserved and produced.

Effective Policies, Best Practices & Conclusion

Information governance requires the implementation of a records retention policy. A data map should be maintained to help facilitate the preservation and production of data for litigation. Data should only be retained for so long unless a preservation obligation arises.

A data map must a constantly updated reference and account for how employees move data to different locations.

Electronic Discovery Institute Class 28: Building an eDiscovery Practice and Team

Here's a continuation of my postings about the Electronic Discovery Institute's online e-discovery certification program, that you can subscribe to for just $1. I last blogged about this program on August 10, 2018. Go to https://www.lawinstitute.org/ to sign up for it.

The course entitled, Building an eDiscovery Practice and Team, is taught by Scott Milner, an attorney with Morgan Lewis's eData practice; Renee Meisel, a Legal Director for Dell, Inc., who specializes in cybersecurity; and Jennifer Hamilton, an eDiscovery counsel for Deere & Company.

What is an eDiscovery Team?

An eDiscovery team will coordinate with different groups of people within an organization - the legal department, IT, and different business groups. An in-house team can help standardize an organization's approach to electronic discovery so it is defensible and repeatable.

The potential for the same problem to approached in different ways may arise because of the involvement of both in-house and outside counsel on any one case. The eDiscovery team should try to manage the cost of electronic discovery to a business. Hamilton has spent a lot of time with HR and cybersecurity personnel to insure the integrity of data used in electronic discovery Part of her aim is to avoid cross border data privacy issues. She finds that new applications are acquired to replace old ones at a more rapid pace than in the past.

Goals of an eDiscovery Team While a legal department may serve as the institutional memory of an organization, the eDiscovery group can help track the location and use of data over time. Milner emphasized the importance of information governance, which concerns records retention; bring your own device policies; and data disposition policies. Hamilton is often consulted at the beginning of cases about how much certain projects will cost and how long they will take. At the end of a matter, the eDiscovery Team will be responsible for retaining data in case it is needed for another matter.

Meisel noted that the eDiscovery Team can help prepare a corporation's witnesses. A member of the team may actually serve as the company's 30(b)(6) witness.

Hamilton observed that the eDiscovery Team's role has evolved away from educating people about the potential dangerous pitfalls of handing ESI improperly, to emphasizing how the team's function can add value to the organization.

The Roles of an eDiscovery Team

Meisel noted that there is now more of a focus on the left side of the EDRM. Her team has developed specialized tools, and developed methods for keeping track of the location of data.

Hamilton finds that it is a challenge to convince other in-house counsel that expertise in eDiscovery can help them gain an advantage in a case, but won't drive the overall strategy of a case.

The Members of an eDiscovery Team

Meisel finds that the key members of the team are the eDiscovery project managers. Hamilton noted that some companies use paralegals as eDiscovery managers.

Meisel noted she has a lot of 'partners' that she needs to rely on to make eDiscovery happen. IT controls access to data; Records will know where documentation is located and how long it will be retained.

Hamilton's group interacts most often with IT. She coordinates with people responsible for information security, as well as the compliance/business conduct group to make sure that contracts that are entered into include provisions for access to data needed for electronic discovery. She spends a lot of time interacting with groups not directly involved in litigation. Business managers must assist with getting data from people before they move on.

Meisel noted that an eDiscovery team can help support internal investigations, and implement data security policies.

The Role of Technology The eDiscovery Team is instrumental in acquiring new technology and also providing input for the internal team on what tools are best for data analysis. After technology is procured user acceptance studies must be conducted.

The team should promulgate disposition requirements, in order to make sure that data does not sit around indefinitely.

Out-Sourcing vs. In-Sourcing

Technology may be brought in-house for data collection and document review or third parties may perform this work. It may be difficult to justify bringing people in-house to perform eDiscovery when a lot of money is being paid to outside counsel for discovery in general.

Milner has seen an increased demand for national discovery counsel.

Working with Merits Counsel

The eDiscovery team should understand the merits counsel's role, which will be more responsible for making strategic decisions. Merits counsel should have a kick-off call with the eDiscovery team at the beginning of a case. They should also review documentation provided by the eDiscovery team.

Building the Team

A team must acknowledge that a business is not designed around facilitating the eDiscovery process. A leader of team should keep track of pending matters and their size in terms of the amount of data involved.

The members of the team should know the relevant rules and keep up with changes to them. They should be prepared to manage legal holds and optimize the team's standard practices. It is not necessary for every member of the team to have prior experience with electronic discovery. Everyone should understand the overall direction for a case. Technology should allow members of the team to collaborate with one another.

Milner's ideal team member will understand each of the steps in the EDRM. People must be involved who understand the process of project management. Someone should be able to apply analytics to the data that is collected. There is a role to play from a financial perspective - is there a return on the investment?

The team should have good communication skills and not be inclined to always describe a project in technical terms. People with backgrounds in conducting IT audits can be valuable.

What is Success for an eDiscovery Team?

Success can be measured in a number of different ways. Cost reduction per gigabyte or custodian should be a key goal. One should try to track the burden of electronic discovery on the organization. This may be hard to do and it may be advisable to rely on anecdotal information.

Having metrics about how electronic discovery is performed can help with plans for future projects.