Ethics in the era of electronic evidence: to represent your clients effectively and ethically, you need a good grasp of the e-discovery process - and the obligations it creates for you and opposing counsel.

Attorneys are bound by codes of professional conduct and must conform to ethical standards governing almost every area of law. Considering the role technology plays in the world today, lawyers must understand and strategically integrate electronic evidence into their cases to represent their clients effectively and ethically.

Litigators who ignore the fact that more than 90 percent of potentially discoverable information is generated and stored electronically risk facing dissatisfied clients, accusations of ethical violations, malpractice suits, and judicial sanctions for failure to comply with electronic evidence obligations. (1) As technology advances and clients' and opponents' systems become more complex, lawyers' duties in discovery also evolve rapidly.

The Model Rules of Professional Conduct state: "A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation." (2) In addition, most states' professional responsibility rules require attorneys to perform legal services with diligence, competence, faithfulness, and good judgment. In today's digital era, this duty of competence requires you to educate yourself and your clients about electronic discovery issues before a complaint or answer is ever filed.

Many members of the plaintiff bar may view electronic discovery--collecting, reviewing, and producing electronically stored information such as e-mail, word-processing documents, spreadsheets, and databases--as primarily defense counsel's problem. After all, defendants generally are the parties ordered to preserve and produce such information. But plaintiff lawyers have e-discovery duties as well. Nearly every set of document requests and interrogatories propounded, for example, seeks (or at least should seek) to uncover e-mail and other electronically stored gems.

Ethical obligations associated with electronic evidence generally fall into three categories:

* a duty to understand how to ask for and uncover smoking-gun documents and other powerful pieces of e-evidence

* a duty to advise clients of adequate preservation protocols

* a duty to use technology to zealously advocate for clients' interests, such as using high-tech innovations to make document review and other tasks more cost-efficient.

Discovery requests

The Federal Rules of Civil Procedure no longer permit discovery on matters that merely may lead to the discovery of admissible information? Rather, you must seek specific, relevant information that relates to the claims or defenses of any party? As with discovery of paper-based documents, requests for electronic documents should not be phrased too broadly. Narrowly tailored requests help you avoid an "overly broad and unduly burdensome" objection and show the court that your discovery is not a "blind fishing expedition." If you keep your requests carefully tailored, opposing counsel is less likely to retaliate with broad and burdensome discovery requests of their own.

Because a large volume of electronic evidence may exist, a narrowly tailored request can increase your chances of actually receiving and identifying the most sought-after information. As the defendant produces the relevant electronic information, you can expand your requests. The court probably will support further discovery efforts if there is no evidence that your discovery requests are overly broad or unduly burdensome. Requests such as "all electronic documents" typically are seen as abusive and not allowed in most courts.

Plaintiff attorneys also have a duty to ensure that defense counsel is complying with discovery requests by closely reviewing the document production process for full compliance. In commenting on recent proposed amendments to the Federal Rules of Civil Procedure, ATLA Immediate Past President Todd Smith noted, "In ATLA's view, the greatest current problems of discovery practice are not the amount of paper involved or the number of electronic records. We believe that the really substantial problem in the area of discovery is the well-documented, continuing, obdurate recalcitrance of defendants in tort litigation ... to make reasonable and necessary discovery in good faith. " (5)

In Coleman (Parent) Holdings, Inc. v. Morgan Stanley & Co., Inc., the court issued an adverse-inference instruction against Morgan Stanley for its discovery practices. It directed the jury to accept that the company helped defraud investors, noting, "The conclusion is inescapable that [the defendant] sought to thwart discovery in this specific case." (6) In May 2005, relying in part on that instruction, the jury awarded damages to Coleman (Parent) Holdings (CPH). (7)

The court was quick to recognize the burden Morgan Stanley's inadequate discovery responses placed on CPH. The court stated,

   Electronic data are the modern-day equivalent
   of the paper trail.... In this case, the paper
   trail is critical to CPH's ability to make
   out its prima facie case. Thus, [Morgan
   Stanley's] acts have severely hindered
   CPH's ability to proceed. The only way to
   test the potentially self-serving testimony of
   [Morgan Stanley] personnel is with the written
   record of the events. (8)

You should know enough about how electronic data is stored so that you can identify when the electronic trail may have been altered or erased. You should then be ready to engage in frank discussion about possible sanctions if defense counsel refuse to comply with their discovery obligations.

Of course, you must comply with these obligations as well. In Invision Media Communications, Inc. v. Federal Insurance Co., a suit based on the breach of an insurance contract, the plaintiff lawyer did not fulfill these duties. The court awarded the defendant costs and attorney fees, noting that a "reasonable inquiry by the plaintiff's counsel ... would have alerted counsel that the plaintiff possessed electronic mail that fell within the scope of Federal's document request." (9) Without specifically discussing ethical concerns, the court held that "the plaintiff has disregarded its discovery obligations, made misleading statements regarding the existence and location of relevant evidence, and/or failed to make reasonable inquiries into matters pertinent to the pretrial discovery phase of this litigation." (10)

Preservation

In cases involving two-sided discovery--when both the plaintiff and the defendant have relevant electronic document collections--both sides need to be concerned with e-discovery preservation and production issues.

Zubulake v. UBS Warburg LLC is an instructive example of the potential perils of unmonitored document preservation and destruction. The multiple Zubulake opinions should serve as more than just a guide to how not to conduct discovery and to what can happen when evidence is deliberately destroyed. (11) In the fifth Zubulake decision, the court stated that litigators have an affirmative duty to ensure relevant documents are preserved by placing a "litigation hold" on them, communicating to the client the need to preserve them, and arranging to safeguard relevant archival media. (12)

Under this reasoning, failure to comply with the duty of preservation--intentionally or unintentionally--could place attorneys and their clients at risk. In the Zubulake case, the defendant's document-preservation practices were in question, but the lessons articulated in the decision apply equally to plaintiff counsel. If your client has a large volume of electronic documents that could be relevant, you should act swiftly and diligently to preserve them.

In Rambus, Inc. v. Infineon Technologies AG, the defendant alleged that the plaintiff instituted a document-purging program despite being on notice of impending litigation over the patents at issue. (13) The court concluded that even if the plaintiff "did not institute its document-retention policy in bad faith, if it reasonably anticipated litigation when it did so, it is guilty of spoliation." (14) The court ordered the plaintiff to immediately produce documents containing information relating to the creation, preparation, or scope of its document-retention policy.

Rambus illustrates an important point: Even if your client has a valid document-retention policy in place, you must instruct the client to modify the policy as necessary to preserve documents if you reasonably anticipate litigation.

Production

Once the review is complete and all documents have been identified as responsive, nonresponsive, privileged, or otherwise, counsel must focus on producing the responsive documents to the opposing party, court, or government. The two main questions that must be addressed at this stage are how they want the documents to be produced and whether they will accept the documents in an electronic format. These questions are best addressed long before the document review begins, typically at some of the first discovery planning conferences with the opposing party or court.

Plaintiff attorneys, usually on the requesting and receiving side of production, will want to address the production format questions long before the discovery deadline. While the production process of the past generally has been production in paper format, it is generally accepted that production in electronic format may be demanded when available. (15)

Because an overwhelming majority of corporate documents appear in electronic format, production in that form should not come as a surprise. It is important that the requesting party make a strategic decision about the format of the data to be delivered, especially in light of the time, ease of use, and cost savings associated with reviewing data in electronic form. Benefits include quicker and more efficient searching, Bates number branding, redacting, annotating, and the ability to catalog and reorganize information for production, depositions, or trial.

Courts are unsympathetic to attorneys who are uneducated about e-discovery best practices or who knowingly shun the duty to produce electronic documents. In Beck v. Atlantic Coast PLC, the court sanctioned plaintiff counsel for their discovery production tactics. (16) The plaintiff had brought a breach-of-warranty and fraud class action. In his complaint, he accused the defendant of using deceptive marketing and sales techniques to sell software on the Internet. Discovery revealed that the plaintiff, in e-mail correspondence with the defendant, had posed as an organization interested in purchasing the software. He then posted the information he obtained on his personal Web page.

During discovery, the plaintiff withheld much of the Web page's content from the defendant. Meanwhile, the defendant discovered the entire content of the page by conductingits own Internet search. The defendant moved for dismissal and sought attorney fees, alleging that the plaintiff and his counsel had acted frivolously and in bad faith.

Finding the plaintiff's behavior "inexcusable," the court dismissed the suit and ordered the plaintiff and his counsel to pay the defendants $25,000. The court stated,

   Without ensuring that [the plaintiff] and
   his counsel bear appropriate responsibility
   for their inappropriate conduct by awarding
   a substantial, but fair, sanction of fees
   and costs against them, this court would do
   a disservice not only to [the defendants]
   and other litigants in this court, but also to
   those plaintiffs whose interests are well
   served by the availability of class action suits
   to remedy harms that would otherwise go
   unredressed. (17)

The power of technology

The bottom line is that attorneys today need to embrace technology to solve the problems that technology is creating within the practice of law. Judges today expect counsel to fully understand the best practices for requesting, preserving, and producing electronic documents, as well as the technology tools available to make these processes quicker, easier, and less expensive. Online review and repository tools are one such example of up-and-coming legal technology. Such tools typically use the Internet for storage and access of discovery documents. Documents are uploaded into the tool and available for retrieval and analysis as needed by the document review team.

As online document-review tools and repositories become more popular and more sophisticated, many attorneys are finding it easier and more cost-effective to produce electronic documents in an online repository. However, the litigation team will typically have to work with an electronic evidence expert or vendor that provides this technology. Also, features among the tools vary widely, and some due diligence will be required when evaluating tools.

If both parties agree to use one, the responding party can categorize, redact, and annotate the documents using the review tool. Then that party can copy the relevant and nonprivileged documents over to a separate production database for the requesting party to use in conducting its review.

With such software programs, reviewers access their documents remotely via a secure Internet connection. The files must be converted to a standard format or undergo some sort of text extraction so they can be placed into a Web-based tool with the ability to search across the collection of documents. Each page of a document is placed into a database after being converted into two separate components: a graphic image (usually a .tiff, .jpg, or .pdf) that can be viewed in a standard browser, and an accompanying file that contains the text and "metadata" for each document. (Metadata is data about the data, such as the "created on" or "last accessed" date in files, or the "to," "from," or "CC" fields in e-mail.) If you are selecting an online review repository, consider the following.

Speed. Look for a software package that provides for speedy document viewing. How many seconds does it take to logon to the system? How many seconds does it take to navigate among online documents?

Security. How are the documents protected against interception by someone else on the Web? Look for a tool with built-in encryption. In addition, no traces of the discovery documents should be left on the reviewer's computer in the process of accessing the documents and reviewing them for privilege and responsiveness.

Ease of use. The software's graphical user interface should be easy to use. The layout should be familiar (similar to a common word-processing or e-mail system) and simple to navigate. How many hours of training are necessary before the review team can begin looking at documents?

All-inclusive software. Can standard software such as Microsoft's Internet Explorer be used? Must additional software or licenses be purchased before the review begins, and what do they cost? Are there any hidden costs associated with the review that were not laid out in the contracting phase, such as additional costs for excess time logged into the tool, printing documents from it, or technical support?

Robust functionality. Online review systems are constantly changing, offering the customer more advanced features. Does the repository offer note-taking, highlighting, redactions, redaction coding, or privilege log creation?

Searching. The ability to search the database is one main advantage of keeping them in an electronic format. How do the repository's search features work? Can the metadata be searched and sorted? Are notes and comments searchable? Is advanced searching (conceptual or "fuzzy" searching) available?

Duplicate handling and family cascading. If the data is kept in an electronic format, relationships between duplicate documents and "parent" and "child" documents can be identified and maintained in the database.

Mass categorization. Reviewers can categorize several documents at once based on search results. This feature gives reviewers the power to categorize documents as clearly responsive, nonresponsive, or potentially privileged and to review them more quickly in groups rather than individually.

Native file review. Cutting-edge online document repositories allow for both native (original file format) and .tiff (image of the document) viewing in one database. Such tools have emerged only recently in the legal arena. Without them, litigation teams have been forced to deal with the disadvantages of raw native files or .tiff or .pdf images when reviewing documents.

Disadvantages of native files include

* the risk of spoliation of evidence 

* the risk of inadvertently altering metadata and document content

* the need for software applications associated with each native file

* the inability to overlay or brand documents with number schemes.

Disadvantages of .tiff or .pdf images include

* the inability to index and catalog images

* the inability to see formulas and hidden comments embedded in the document

* the need for outside assistance to convert the original files to .tiff or .pdf images.

Using these new tools, depending on their functionality, counsel can leverage the advantages of native file review and .tiff image review without the drawbacks of reviewing either format in its individual setting.

As technology plays an increasingly significant role in modern litigation, plaintiff attorneys must understand the details of preserving, requesting, and producing electronic evidence. All litigators--plaintiff and defense--must discuss electronic data issues thoroughly and early on in the litigation to avoid subjecting themselves or their firms to claims that they failed in their duty to competently represent their clients. A comprehensive understanding of the electronic discovery process---coupled with strategies to manage it--will help litigators avoid judicial sanctions, ethical violations, adverse inferences, and malpractice claims.

Notes

(1.) KEVIN CRAINE, DESIGNING A DOCUMENT STRATEGY (2000).

(2.) MODEL RULES OF PROF'L CONDUCT R. 1.1 (2003). Other model rules also apply to electronic discovery. See, e.g., R. 1.3 (stating that a lawyer should act with "commitment and dedication to the interests of the client and with zeal in advocacy upon the client's behalf"); R. 3.4 (a) (stating that a lawyer shall not "unlawfully obstruct another party's access to evidence or un lawfully alter, destroy, or conceal a document or other material having potential evidentiary value"); and R. 1.2 (imposing on counsel a duty to "consult with the client as to the means by which [the objectives of the representation] are to be pursued").

(3.) FED. R. CIV. P 26 Advisory Committee note.

(4.) FED. R. CIV. P. 26(b).

(5.) Statement of Todd A. Smith, President, ATLA, on proposals for rule-making on discovery of electronically stored information, Advisory Committee on the Rules of Civil Procedure, Judicial Conference of the United States (Feb. 11, 2005), available at www.uscourts.gov/rules/ e-discovery/04-CV-012.pdf (last visited Aug. 24, 2005).

(6.) No. 502003CA005045XXOCAI, 2005 WL 679071, at *6 (Fla., Palm Beach County Cir. Ct. Mar. 1, 2005).

(7.) Drew Douglas, Fla. Jury Orders Morgan Stanley To Pay $1.45 Billion in Sunbeam Case, SEC. REG. & LAW REP., May 23, 2005, available at http://corplawcenter.bna.com/pic2/clb.nsf/id/ BNAP-6CJU2F?OpenDocument (last visited Aug. 24, 2005).

(8.) Coleman (Parent) Holdings, Inc., 2005 WL 679071, at *6.

(9.) No. 02 Civ. 5461, 2004 WL 396037, at *8 (S.D.N.Y. Mar. 2, 2004).

(10.) Id. at*9.

(11.) See Zubulake v. UBS Warburg LLC, 217 F.R.D. 309 (S.D.N.Y. 2003) (Zubulake I); No. 02 Civ. 1243, 2003 WL 21087136 (S.D.N.Y. May 13, 2003) (Zubulake II); 216 F.R.D. 280 (S.D.N.Y. 2003) (Zubulake III); 220 F.R.D. 212 (S.D.N.Y. 2003) (Zubulake IV); No. 02 Civ. 1243, 2004 WL 1620866 (S.D.N.Y. July 20, 2004) (Zubulake V); No. 02 Civ. 1243, 2005 WL627638 (S.D.N.Y. Mar. 16, 2005) (Zubulake VI).

(12.) Zubulake V, 2004 WL 1620866.

(13.) No. 3:00CV524, 2004 WL383590 (E.D.Va. Feb. 26, 2004), vacated and amended by 220 F.R.D. 264 (E.D. Va. 2004).

(14.) 220 F.R.D. 264, 286.

(15.) Anti-Monopoly, Inc. v. Hasbro, Inc., No. 94CIV.2120, 1995 WL 649934 (S.D.N.Y. Nov. 3, 1995). "The law is clear that data in computerized form is discoverable even if paper 'hard copies' of the information have been produced .... [T]oday it is black letter law that computerized data is discoverable if relevant."

(16.) 868A.2d 840 (Del. Ch. 2005).

(17.) Id. at 844.

CHRISTOPHER D. WALL, a former practicing attorney, is a legal consultant with Kroll Ontrack, an Eden Prairie, Minnesota-based company that provides discovery and computer forensics services. He works in the company's Reston, Virginia, office. He gratefully acknowledges the assistance of Charity Delich, a Kroll Ontrack law clerk, in writing this article.