5 Things to Include in an ESI and E-Discovery Clawback Agreement
What is a clawback agreement? It is an agreement permitted by Federal Rule of Evidence 502 allowing parties to “claw back” inadvertently produced attorney work product or attorney-client privileged information.
According to the Explanatory Notes, Rule 502 is a response to widespread complaints that preventing disclosure of privileged information during electronic discovery is a costly endeavor. To those ends, under Rule 502(b), inadvertent production of privileged information does not waive the privilege if the party took reasonable steps to prevent and rectify the disclosure.
Importantly, litigants may craft their own “clawback” or non-waiver agreements as an alternative to the language of Rule 502(b). Attorneys are well advised to enter into such agreements or include a clawback provision in an ESI or e-discovery protocol. When drafting and negotiating clawback agreements, here are some things to consider:
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Are the requirements of inadvertent production and reasonableness applicable?
As noted, Rule 502(b) prevents the waiver of privilege only if disclosure is inadvertent and reasonable steps are taken to prevent and rectify the disclosure. However, many clawback agreements provide that any production of protected information may be clawed back regardless of inadvertence and regardless of reasonable steps taken to prevent disclosure (if any).
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If the parties desire to maintain the reasonableness requirement, what constitutes reasonableness?
If parties want to maintain Rule 502’s reasonableness standard, they might consider detailing what, specifically, are reasonable efforts to prevent against the disclosure of privileged information. Specifying what constitutes reasonable efforts creates benchmarks to guide courts if disputes arise over the disclosure of protected information.
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What, if any, deadlines apply to clawback rights and how are they invoked?
As noted, Rule 502(b) states that to maintain attorney-client privilege or work product protection, the producing party must “promptly [take] steps to rectify the error” in producing privileged materials. However, a clawback provision may alter the requirement of prompt action. Parties may agree that privileged documents may be clawed back at any time, or may specify when parties must notify the others of the production of protected information and may how notice is to be provided. For instance the agreement may require 14 day written notice with an explanation of the basis of the privilege.
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How will disputes be resolved?
Non-waiver agreements often detail what meet and confer requirements are necessary before bringing privilege disputes before the court and may also establish deadlines within which the matter must be raised. Clawback agreements sometimes also specify who bears the burden of establishing the privileged nature of the disputed information.
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Will the non-waiver agreement bind third parties?
It is important to note that under Rule 502(e), if a clawback agreement is not incorporated into a court order, it binds only the parties to the agreement. Thus, clawback language is often included in protective orders entered by the court. Along these lines, it is worth noting that if one party will not agree to a clawback clause, there is nothing preventing the other from unilaterally asking the court to enter a non-waiver order.
For further reading about Rule 502(e) clawback agreements take a look at this opinion in Klein v. Facebook, Case No. 20-cv-08570-LHK (N.D. Calif. June 3, 2021). The court examined in detail the issues discussed above. For a sample clawback agreement and examples of clawback provisions, see the model order from the Fordham Law Review.
Other Articles on Clawback Agreements You May be Interested in:
Even With Clawback Agreement, Use of Material May Waive Privilege
How Much Privilege Review is Required Under a Clawback Agreement?
6 Things to Include in E-Discovery “Quick Peek” Agreements
