Tips for Following Best Practices in E-Discovery Data Management

As technology continues to evolve and electronic devices become cheaper to purchase and easier to use, it is inevitable that the volume of e-discovery available for collection in litigation will continue to grow exponentially. Companies that want to stay current need to invest more personnel and financial resources to e-discovery management before litigation occurs to reduce risk and keep costs at a minimum so that they are ready when lawsuits are foreseeable and comprehensive e-discovery requests are made by opposing counsel.

When e-discovery requests are served in litigation, companies may be required to search through wide ranging types of electronic data including, but not limited to, emails, memos, pdfs, calendar entries, contacts, thumb drives, home computers, text messages, social media posts, voicemails, photos and videos. Basically, any type of electronic information that can be shown to likely contain business communications can become necessary to preserve, even if it may not ultimately be discoverable in litigation. Spoliation claims are much easier for companies to defend when they implement and follow a well thought out plan to manage the different types of electronic data that may eventually be discoverable.

When putting together a data management and document retention policy for your business, it is important to consider all of the various ways in which employees within your business communicate. You should make sure all known forms of business communication are addressed in your policy with specific instructions as to how long each type of data should be retained. You should also monitor your employees to make sure they are following procedures by disposing of the data according to the retention period outlined in the policy. It is important to communicate to employees through email or memorandum that they should ask any questions they might have about compliance with the policy and someone knowledgeable should be assigned to respond to those questions.

If litigation is reasonably foreseeable, the litigation hold policies established in the policy should immediately be triggered, which would include instructing those individuals within your company who are identified as having possession or access to documents, electronically stored information or tangible items that are potentially discoverable to immediately suspend any auto-deletion programs and otherwise suspend the disposal of information pursuant to the standard retention procedures. Using best practices, communication of suspension of the retention policy should be verbally as well as via a memo attached to an email as part of well thought out and described litigation hold instructions so that you have something to use in court if opposing counsel decides to challenge your discovery process with the goal of making a claim of spoliation. Further, you should continue to follow-up with company employees that receive the litigation hold to make sure they continue to comply with its terms and to answer any questions they may have. Constant auditing of the policies is an additional way to defend against a claim of negligence discovery practices.

Taking the steps outlined above with regards to data retention before and during litigation can potentially save you and your company from incurring substantial litigation costs, including possible sanctions when dealing with e-discovery requests.


In Solo v. United Parcel Services Co., No. 14-12719, 2017 U.S. Dist. LEXIS ______ (E.D. Mich. January 10, 2017) UPS successfully argued that a discovery request was excessively burdensome, using as support the fact that the company had established internal policies to archive information on to back up tapes after six months, with the business rationale being that the volume of information was so large that it was only maintained in a “live” format for that limited time period. UPS then outlined that collecting usable data from the back up tapes would require custom software, take six months, and cost around $120,000, and offered an alternative less costly mechanism for providing their opponents with information that would suit their needs.

The important message to businesses of all sizes is that having sound and rational data retention policies that are strictly and consistently followed can provide powerful evidence to support motions objecting to burdensome requests for collection and preservation of documents, under the new proportionality principles embedded in the late 2015 changes to the Federal rules. Without such internal policies and procedures, defenses are difficult to maintain against fishing expeditions that impose a cost burden on companies, resulting in warped case evaluations and early unwanted resolutions of what are often otherwise meritorious cases.

There are many factors to consider in establishing such policies, including costs and forms of archiving data, downsides of reducing immediate access to some data versus savings from archiving it, compliance with relevant regulations and laws, compliance with existing litigation holds, and much more. For more on the importance of litigation holds, click HERE.

However, given the potential runaway costs of complying with onerous discovery obligations, companies would be wise to spend the time and money necessary on the front end to put reasonable data management policies in place that will arm litigation counsel with evidence needed to support proportionality objections, potentially resulting in untold future savings.


The Texas Supreme Court has agreed to hear oral argument on March 9, 2017, in In re State Farm Lloyds from Hidalgo County and the Corpus Christi-Edinburg Court of Appeals.

This notable case has the potential to significantly impact future obligations and burdens on litigants in Texas cases to preserve and produce electronic data, and the resulting impact on their abilities to economically defend against the merits of claims. The main issue is whether the trial court abused its discretion by ordering production of documents in “native” or “near-native” format (with metadata) instead of static images, like Portable Document Format (PDF) or Tagged Image File Format (TIFF). The specific issues presented are:

  1. Did the trial court abuse its discretion by imposing an ESI protocol that misinterprets Texas Rule of Civil Procedure 196.4 because its order mandates specific forms of production absent a novel showing of “infeasibility,” eliminates all other available objections under the civil rules, and disregards evidence that the producing party proffered other reasonably usable formats?; and
  2. Did the trial court abuse its discretion by disregarding proportionality considerations under Texas Rule of Civil Procedure 192.4 where a party has proffered reasonably usable formats that are a less intrusive and less burdensome means of meeting the party’s discovery obligations?

State Farm, in its brief and request for Oral Argument, argues that “A new but significant battleground has emerged in Texas involving. . . .a group of plaintiffs’ attorneys who routinely sue on behalf of insureds after essentially every Texas storm and seek to inflate the value of cases simply by demanding extensive and invasive discovery that is disproportionate to the value of their claims and thereby obtain unjust, unfair, and inequitable dispositions of their cases. . . .

The latest tactic of certain plaintiffs’ attorneys is to insist on particular ‘forms of production’ for electronically stored information (“ESI”). Using an unsupported application of Texas Rule of Civil Procedure 196.4, these plaintiffs’ attorneys argue that a trial court must honor whatever form of production a requesting party demands for any case of any type or any size – regardless of the need for, or the burdens and intrusions imposed by such formats, or the availability of alternate formats that are reasonably usable. When these form of production demands are overlaid on equally draconian discovery requests of increasing scope and breadth, this combination threatens to eviscerate the tenets of Rule 1 of the Texas Rules of Civil Procedure by forcing insurance carriers to decide whether to resolve cases at vastly inflated amounts, or incur the excessive cost required to meet the discovery demand and to defend hundreds of cases after every major weather event. If plaintiffs are permitted to carry on with this strategy, the consequences for civil discovery in Texas will be dramatic. Responding parties will no longer be able to seek or obtain relief through long-honored discovery objections that exist under the Texas Rules, or rely on standard procedures, methodologies, or technologies to determine the appropriate method to produce their own electronically stored information. Instead, all responding parties will be at the mercy of burdens and expenses imposed literally at the whim of requesting parties, and these ‘whims’ could literally change from cases to case.”

The Federal Rules, amended December 2015, put a renewed emphasis on proportionality, and the decision in this case will signal whether or not Texas is going to move in the same direction.

The Importance of Establishing a Litigation Hold Release Policy

Any e-discovery counsel can mindlessly rattle off the standard criteria for when a litigation hold should be initiated – upon reasonable anticipation of litigation. Many articles and blogs have covered what that means, and the significant risks for not timely issuing a litigation hold.

However, the question of when a litigation hold should properly be released is not as well established. Litigants are eager to release litigation holds for all the same reasons they would prefer never to have to issue one – litigation holds are costly, burdensome to manage and maintain, and create unwelcome tension due to fears of violating the legal hold. (It is equally important to release a litigation hold when appropriate, as delaying releasing a hold can lead to future complications, but that could be the topic of a whole separate post.) The common sense initial thought is once a case that is the source for the litigation hold is “over” (settled, dismissed, tried to verdict, appeals exhausted, etc.) the hold can be released. While that may be true in many circumstances, the issue is more complex.

In order to handle the release of a litigation hold in a good faith way that will provide a reasonable position in Court, should the release ever be challenged, a company’s position on when to release a litigation hold should be clearly set forth as one part of a company’s overall written e-discovery policies. Having pre-established set criteria for the release of a hold, as with the initiation of a hold, shows good faith consistent application and helps avoid being susceptible to an accusation of arbitrary case by case manipulation.

This policy should be strictly adhered to in every case. While it is all too easy to disregard the policy as attention turns quickly away from a lawsuit as soon as it is resolved, inconsistent application puts the company at the same risk of being accused of making post-hoc decisions on whether and when to release a hold. The policy that is written should probably strike the balance between what can technically be justified (releasing a litigation hold the moment it is possible to do so) and being overly cautious and leaving a litigation hold in place beyond what is practical. However, erring on the side of caution and leaving some wiggle room so it can be argued to a Court, if ever necessary, that the company took a conservative approach arms litigation counsel with a powerful and persuasive starting position if the release of a hold is ever at issue.

The policy setting the criteria should take into account multiple factors to be considered as part of a decision matrix for each individual case, including:

  • Whether other similar claims have been or could be made (Under what circumstances can you truly feel justified in the position that another similar lawsuit is not likely to be filed? Does reasonable anticipation of litigation persist for some time period just because of the simple reality that one case was already filed?);
  • Whether dissimilar claims have been made but would implicate some of the same data;
  • Whether the issue could conceivably be litigated again (is the product still on the market, e.g.);
  • What the burden and cost is of maintaining the hold;
  • Whether the case has been completely resolved; and
  • What optics the company wants to create — if a hold is released immediately after a case is perceived as final, and then the worst case scenario occurs and a new case is filed, no doubt opposing counsel in that new case will accuse the releasing party of bad faith for having not maintained the hold for some reasonable minimum period of time.

Finally, it is just as important to audit the proper release of a litigation hold as it is to audit compliance with a litigation hold. If some custodians hold onto data that should be discarded, it can compromise the position that the data was no longer necessary to be retained.

As with all things in e-discovery, having a plan and staying true to it is critical to avoiding having a Court sense, rightly or wrongly, that something untoward has happened and having that color their view of the client or negatively impact an otherwise meritorious case.

Steps Companies Can Take In Protecting Themselves From Costly Discovery Disputes Related to Text Messaging

Given its position as a quick and easy way to exchange information, texting continues to grow in popularity as a way for co-workers to communicate about substantive business related activities. With the growth in business texting, the division between private and discoverable communications has become extremely thin. While courts in civil litigation are unlikely to allow a wide open search of an entire personal mobile phone given the privacy issues that would come into play, texts on personal devices are still very much an open discovery source. This is especially true if the request for text messages is narrowly targeted and the information sought is unavailable from other sources.

According to eWeek, over 80% of people use text messaging for business and 15% said that more than half of their total number of text messages are for business purposes. Given this information, it is not surprising that text messaging has been a regularly contested subject in litigation discovery disputes. Courts have shown they are willing to hand out harsh sanctions and fines in excess of $1 million when they believe discoverable text messages were improperly destroyed.

The following are some fairly straightforward steps a company can take in protecting itself from costly e-discovery disputes relating to text messages in both federal and state court.

1. Create An Effective Mobile Device Policy

Many e-discovery problems can be avoided in the first place by creating a well-written and comprehensive mobile device policy. The policy should clearly lay out under what circumstances, if any, texting will be allowed for business purposes by company employees. The language used in the policy should be straightforward and easy for all company employees to understand.

If helpful, a mobile device policy can be tailored specifically to different aspects of the company’s business. For example, if a company employs a large sales force that relies on texting as a way to communicate simple logistics related meetings with customers to co-workers (such as the timing and location of meetings), it may make sense to have the policy state that texting is allowed for communication of meeting logistics but that it is never to be used for substantive business purposes. This type of mobile device policy would also need to include a clear and concise definition as to what type of communications would be considered substantive.

Drafting a mobile device policy can be a challenge if you are unfamiliar with how they are put together and what information should be included. Therefore, it often makes sense to consult with those who specialize in e-discovery to make sure you are doing what is necessary to protect your business.

2. Take Appropriate Steps To Ensure The Mobile Device Policy
Is Being Followed By Company Employees

There are several steps a company can take to ensure that its employees understand and follow a mobile device policy. First and foremost, the details of the mobile device policy should be communicated both verbally and in writing to all employees. The company should also provide its employees training on how the mobile device policy applies to them. In addition, employees should be given an opportunity to ask questions about the policy and how it may affect them. Once these steps have been performed, employees should be required to sign a form indicating that 1) they are aware of the policy; 2) they have been given the opportunity to ask questions about the policy; and 3) they will follow it. Further, the policy should be included in the company employee handbook and that handbook should be distributed to all current employees and any new employees moving forward. Any updates to the policy should be communicated immediately to all employees.

3. Encourage Verbal Communications Rather Than
Electronic Communications Between Employees

Another way to protect your company from incurring unnecessary costs and potential sanctions related to text messages requested through e-discovery is to encourage employees to communicate face-to-face or on the phone rather than by electronic means. Communicating verbally rather than by electronic means is often the most effective to get a point across to a co-worker. In addition, it can lead to more collaboration and less misunderstanding given that verbal communications are not limited to what can be typed on a mobile phone or computer.

4. Address Text Messaging As Part Of Litigation Hold Procedures

When issuing a litigation hold, it is important to include language instructing employees to preserve all text messages in a litigation hold policy. It is surprising how often attorneys neglect to take this critical step. Including specific language addressing text messaging in a litigation hold policy can help avoid the loss of critical data, which often times cannot be retrieved.

As text messaging in business continues to grow in popularity, it is important for companies to make sure that they take the steps necessary to protect themselves against costly e-discovery disputes. The steps outlined above are a good way for companies to try to protect themselves against incurring costly sanctions for spoliation of evidence related to text messages when litigation arises.