E-Discovery Law Alert

E-Discovery Law Alert

Developments in Electronic Discovery and Corporate Information Technology

Florida is the Latest State to Allow Attorneys to Advise Clients About the Removal of Social Media Posts and Pictures

Posted in Legal Decisions & Court Rules, Litigation Preparedness & Strategies

On January 23, 2015, the Professional Ethics Committee of the Florida Bar issued an advisory opinion holding that before litigation commences, and absent any other preservation obligation, an attorney may advise a client to: (1) remove information from social media pages and (2) change privacy settings from public to private, as long as the client retains a record of any deleted information or data. In so holding, the Florida ethics committee joined panels from New York, Pennsylvania, and North Carolina that have issued similar guidance.

By way of background, an attorney sought guidance about the ethical implications of advising a client to “clean up” his social media pages before litigation commences to delete “embarrassing” information the attorney deemed immaterial and not directly related to impending litigation. Because the client retained counsel, the ethics committee assumed litigation was “reasonably foreseeable” and, therefore, determined the appropriate inquiry was whether the social media was “relevant,” rather than “related directly” to the underlying litigation. The ethics committee held that relevancy is determined on a factual, case-by-case basis.

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Two Failures to Preserve, Two Starkly Different Results in New York

Posted in Legal Decisions & Court Rules

Two recent spoliation decisions, both out of the same New York Court and issued within a week of each other, demonstrate the potential for starkly different sanctions results depending on the level of culpability of the spoliator.

AJ Holdings Group, LLC, v. IP Holdings, LLC, Index No. 600530/2009 (Sup. Ct. N.Y. County, September 19, 2014) and L&L Painting Co., Inc. v. Odyssey Contracting Corp., 2014 N.Y. Misc. LEXIS 4300 (Sup. Ct. N.Y. County, September 25, 2014) are both breach of contract actions in which plaintiffs were accused of spoliating evidence. In both cases, plaintiffs failed to issue litigation holds after the duty to preserve was triggered and emails from key players were destroyed. That is where the similarities end.

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Bill to Expand Data Breach Notification Requirements Passes New Jersey Assembly

Posted in Legal Decisions & Court Rules

On December 15, 2014, the New Jersey Assembly voted 75-to-0 to advance a bill that would expand the existing data breach notification requirements for companies doing business in the state. The bill, A3146, would broaden the type of information that, if compromised, would trigger a company’s obligation to notify customers of the breach. The proposal now heads to the Senate, where a similar bill, S2188, has been pending in the Commerce Committee since June.

If enacted, the bill would expand the definition of “personal information” to include a customer’s “user name or email address, in combination with any password or security question and answer that would permit access to an online account.” The current definition already includes a customer’s (1) Social Security number; (2) driver’s license or State identification card number; and (3) account, debit, or credit card number, in conjunction with any required access code or password that would permit access to an individual’s financial account. Under the current law, if data falling into any one of these three categories is illegally accessed, along with an individual’s first name or initial and last name, the company must disclosure the breach to the customers affected.

With this proposed update, New Jersey lawmakers are recognizing that individuals are increasingly using online accounts to store sensitive and potentially valuable data. If hackers obtain the credentials to access such accounts, that data may be stolen and used to the detriment of the account holders. As the spate of recent corporate data breaches has shown, businesses of all sizes are increasingly being targeted by more sophisticated hackers and the risk of a data breach is growing everyday. Therefore, in addition to protecting against such security breaches before they occur, it is imperative that companies doing business in New Jersey are aware of the steps that should be taken following a data breach, including complying with all applicable data breach notification laws.

Michael C. Landis is an Associate in the Gibbons Business & Commercial Litigation Department and a member of the Gibbons E-Discovery Task Force. This post originally appeared on the Business Litigation Alert on January 22, 2015.

Software License Cannot Be Used as a “Shield” Against Production

Posted in Legal Decisions & Court Rules

In Pero v. Norfolk Southern Railway, Co., No. 14-cv-16 (E.D. Tenn. Dec. 1, 2014), the United States District Court for the Eastern District of Tennessee concluded that a party cannot use a video software license to block a party from obtaining relevant evidence. Pero, an employee of Norfolk, sued after he was injured while operating a locomotive. The train was equipped with a camera and recorded the events leading to Pero’s injuries. Pero moved to compel production of the video, which could only be viewed using a proprietary software program. Norfolk moved for a protective order, arguing that providing a copy of the video would exceed the scope of its software license. Norfolk took the position that Pero had to pay $500 to purchase his own license or Pero could view the video in Norfolk’s counsel’s office.

The court began its analysis by reviewing Rule 34 of the Federal Rules of Civil Procedure, specifically subsection (b)(2)(E)(ii), which states that electronically stored information must be produced “in a form or forms in which it is ordinarily maintained or in a reasonably usable form or forms.” The court also relied on the comments to the 2006 amendments, which acknowledge that “[u]nder some circumstances, the responding party may need to provide some reasonable amount of technical support, information on application software, or other reasonable assistance to enable the requesting party to use the information.” The court found that the train’s camera was similar to “[p]olice cruiser cameras, store cameras, and surveillance cameras,” which “often use unique software” but “the existence and use of this software cannot insulate against production.”

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E-Discovery Year-in-Review 2014: Panel at Gibbons Eighth Annual E-Discovery Conference Discusses Recent Developments, Issues, and Trends

Posted in Technology Developments & Issues

On December 5, 2014, Gibbons hosted its Eighth Annual E-Discovery Conference. The day’s first session discussed the year’s significant developments and featured panelists Michael Arkfeld, Principal at Arkfeld & Associates, and two Gibbons E-Discovery Task Force members; Director Jennifer Hradil and Associate Michael Landis.

The panel first addressed attorney competency regarding technology and the potential ethical implications of a failure to use and understand technological advances. Of particular focus was the State Bar of California’s ethics opinion addressing “an attorney’s ethical duties in the handling of discovery of electronically stored information.” Although an attorney’s technological competency is not a new topic, the panel discussed the shift in focus from not just the benefits of using technology, but also the potential negative effects (such as violations of ethics rules) of an attorney’s failure to keep current on the latest technological developments.

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Second Circuit Vacates Defendant’s Conviction Due to Government’s Failure to Authenticate Social Media Evidence

Posted in Technology Developments & Issues

The Second Circuit Court of Appeals has reversed a conviction for unlawful transfer of a false identification document (a forged birth certificate) because the district court abused its discretion and committed error in admitting a Russian social media page — akin to Facebook — that the government failed to authenticate as required by Federal Rule of Evidence 901.

In the trial underlying U.S. v. Vayner, et al., the government offered into evidence a printed copy of a web page from VK.com, “the Russian equivalent of Facebook,” claiming that it was defendant Aliaksandr Zhyltsou’s profile page. At trial, the government offered evidence from Vladyslav Timku, a cooperating witness who had plead guilty to conspiracy to commit wire fraud, aggravated identity theft, and impersonating a diplomat. Timku testified that he was familiar with Zhyltsou’s forgeries because he had hired Zhyltsou to create false documents for him, including the forged birth certificate at issue. Timku testified that Zhyltsou e-mailed the forged birth certificate to him using the Gmail address “azmadeuz@gmail.com.” Timku’s testimony was the only evidence connecting Zhyltsou to this Gmail address.

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#Do-Not-Disclose — Twitter Sues Government Alleging Free Speech Violation

Posted in Legal Decisions & Court Rules

Twitter’s ubiquitous 140-character-or-less tweets are not, the company argues, sufficiently similar to email or other forms of stored electronic information to warrant lumping them together with the likes of Google, Microsoft, Facebook, Yahoo!, or Apple, all of which have agreed to restrictive limitations on their public reporting of government surveillance. Twitter has sued the U.S. Government in federal court in California to make its point.

The case arises because the federal Stored Communications Act (“SCA”) authorizes the FBI to issue National Security Letters (“NSLs”) to electronic communication service providers, such as Twitter, compelling them to disclose “subscriber information and toll billing records information” upon an FBI certification that the information sought is “relevant to an authorized investigation to protect against international terrorism or clandestine intelligence activities.” 18 U.S.C. § 2709(a), (b). In addition, various sections of the Foreign Intelligence Surveillance Act (“FISA”) permit the government to seek court-ordered real-time surveillance or disclosure of stored records from an electronic communication service provider; and again various laws prevent recipients of a FISA court order from disclosing information about that order. See 50 U.S.C. § 1805(c)(2)(B); 18 U.S.C. § 793.

Twitter argues that these statutory restrictions prevent it from countering “inaccurate information reported in the media, statements of public officials, and related public concerns regarding [Twitter’s] involvement with and exposure to U.S. surveillance efforts.” Twitter also believes that these various laws — and the government’s interpretation of and reliance on them — are facially invalid and, as applied, violate Twitter’s First Amendment right to engage in speech regarding a matter of significant public concern.
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Rule Amendments Update: Judicial Conference Approves Proposed Changes

Posted in Legal Decisions & Court Rules

On September 16, 2014, the Judicial Conference approved, without changes, the proposed amendments to the Federal Rules of Civil Procedure. (For background information on the proposed amendments and the approval process, see our previous blog posts from June 19, 2014, May 27, 2014, February 10, 2014, and May 6, 2013.) The proposed amendments, which include changes to the definition of the scope of discovery in Rule 26(b)(1) and the applicable standard courts should apply when considering sanctions for ESI spoliation under Rule 37(e), will now be submitted to the U.S. Supreme Court for consideration and approval. If adopted by the Supreme Court before May 1, 2015, and Congress does not intervene, the proposed amendments will take effect on December 1, 2015.

Michael C. Landis is an Associate in the Gibbons Business & Commercial Litigation Department.

Attempting to Shoot for the Moon and Settle For the Stars During the Meet and Confer Process May Result in Obtaining Neither

Posted in Legal Decisions & Court Rules

A recent decision out of the Northern District of California provides a sobering reminder that a party’s obligation to meet and confer must be undertaken in good faith. If a party is overly aggressive – and therefore perceived not to be acting in good faith – it may wind up with nothing.

Boston Scientific Corporation v. Lee, was a fairly typical case involving a former employee’s alleged theft of trade secrets. Defendant Dongchul Lee (Lee) left Plaintiff Boston Scientific Corp. (Boston) and began working for a competitor, nonparty Nevro Corp. (Nevro). Shortly thereafter, Boston sued Lee, claiming theft of trade secrets and violation of a confidentiality agreement. Boston alleged Lee had downloaded its confidential information onto a USB thumb drive, and used these trade secrets in his subsequent employment with Nevro.

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Rule Amendments Update: Standing Committee Approves Proposed Changes

Posted in Legal Decisions & Court Rules

On May 29-30, 2014, the Judicial Conference’s Standing Committee on Rules of Practice and Procedure (the “Standing Committee”) met and approved the proposed amendments to the Federal Rules of Civil Procedure. (For background information on the proposed amendments, see our previous blog posts from May 27, 2014, February 10, 2014, and May 6, 2013.) The Standing Committee approved the entire slate of proposed amendments, including changes to the scope of discovery, as defined in Rule 26(b)(1), and changes to the standard to be applied by courts when imposing curative measures or sanctions for the spoliation of electronically stored information, as per Rule 37(e). Before approving the proposed amendments, the Standing Committee made several minor revisions, including changes to the proposed Committee Notes to Rules 26 and 37 (the meeting minutes setting forth the precise changes were not available as of writing). The Agenda Book from the Standing Committee’s meeting is available here.

The full Judicial Conference will take up the proposed amendments during its next meeting in September 2014. If approved by the Judicial Conference, the proposed amendments will then be submitted to the U.S. Supreme Court for consideration and approval. If adopted by the Supreme Court before May 1, 2015, the proposed amendments would take effect on December 1, 2015.

Michael C. Landis is an Associate in the Gibbons Business & Commercial Litigation Department and a member of the Gibbons E-Discovery Task Force.
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