Technology-Assisted Review Is Not Compulsory, but Litigants’ Reluctance to Accept New E-Discovery Technologies Comes With Consequences

A Special Master appointed to administer discovery disputes in In re Mercedes-Benz Emissions Litigation, pending in the District of New Jersey, rejected Plaintiffs’ application to compel Defendants to utilize technology assisted review (“TAR”) or predictive coding in connection with the parties’ negotiation of their search term protocol. While we have previously addressed courts that have “endorsed” the use of predictive coding and/or TAR and have recommended that litigants consider the use of such technologies to promote efficiency in the discovery process, courts will be extremely hesitant to impose affirmative requirements on litigants in carrying out discovery.

TAR is a process “in which human reviewers and a computer engage in an interactive process to ‘train’ the computer how to identify responsive documents based on properties and characteristics beyond simple search terms.” Special Master Dennis M. Cavanaugh, U.S.D.J. (ret.) observed that courts have universally concluded that TAR is “cheaper, more efficient and superior to keyword searching.” Nevertheless, the Special Master acknowledged that “responding parties are best situated to evaluate the procedures, methodologies, and technologies appropriate for producing their own electronically stored information.” Thus, while courts have permitted parties to use TAR for document review, no court has compelled predictive coding over another party’s objection.

The Special Master followed the approach of the few courts that have addressed this issue in declining to compel Defendants to employ predictive coding in their review of documents. The Special Master adopted the reasoning of these courts and espoused in the Sedona Principles, specifically Principle 6, by determining that, notwithstanding the fact that TAR would “likely be a more cost effective and efficient methodology for identifying responsive documents,” the parties are in the best position to evaluate and decide for themselves the appropriate technology for producing their ESI. While granting Defendants autonomy to forge their own path with respect to the review and production of ESI, the Special Master cautioned Defendants with respect to any future arguments they may raise with respect to burdensome discovery in light of their refusal to proceed with a “cheaper, more efficient” means of document review.

As promised, a month after issuing the above decision, the Special Master rejected Defendants’ burden arguments in connection with the parties’ dispute involving the scope of discovery and appropriate custodial sources. The Special Master determined that Defendants failed to sustain their burden to demonstrate that the production of particular materials would create an undue burden and reminded Defendants that the court would disregard any “generalized arguments of burden and cost,” given that the parties chose to utilize search terms as opposed to TAR.

Given the limited amount of authority in the Third Circuit regarding TAR and the compulsion of parties’ utilization of predictive coding, these decisions serve as important guideposts for attorneys dealing with emerging technologies in e-discovery. Perhaps, most importantly, these decisions illustrate the impact of these technological developments on litigation strategy throughout all phases of discovery.

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