What You Need to Know About the FRCP E-Discovery Amendments

As referenced in prior posts, amendments to the Federal Rules of Civil Procedure addressing e-discovery and electronically stored information (ESI) are closer to adoption. On April 29, 2015, the United States Supreme Court approved the amendments and transmitted them to Congress for final approval. The amendments, which are discussed below, are expected to become effective December 2015.

Rule 1 Amended to Emphasize that Courts, Litigants and Lawyers Are All Obligated to Pursue Efficient Litigation

The amendments start at Rule 1 which is amended to emphasize that litigants and their attorneys, not just courts, are responsible for efficient litigation. The amendments add language stating that the Rules of Civil Procedure should be “employed by the court and the parties to secure the just, speedy, and inexpensive determination of every action and proceeding.”

One reason for this change is to emphasize procedural proportionality. The notes to Rule 1 observe that suggestions to improve civil procedure often include “pleas to discourage over-use, misuse, and abuse of procedural tools that increase cost and result in delay.”

Scheduling Orders Issued Earlier in Case

In an effort to speed litigation, as amended, Rule 16 reduces the time in which courts must issue scheduling orders. Under the new rules, scheduling orders are due from the earlier of 90 days from service on a defendant (currently a 120 day deadline), or 60 days (instead of 90 days) after the appearance of a defendant.

However, the drafters acknowledge that in complex cases lawyers may not be ready to enter scheduling orders under shortened deadlines because of inadequate time to prepare for and participate meaningful Rule 26(f) conferences. Thus, even as amended, Rule 16 permits courts to extend deadlines for scheduling orders when cases warrant.

Additionally, as amended, Rule 16 will permit courts to address three additional items in scheduling orders: 1) preservation of ESI; 2) Clawback agreements reached by the parties under Federal Evidence Rule 502; and 3) requiring parties to request a court conference before filing discovery motions.

Rule 26 Emphasizes Proportionality and Limits Discovery to Information Relevant to a Claim or Defense

The committee made several amendments to Rule 26 including a narrowing of the scope of permissible discovery and moving the proportionality standard now found in Rule 26(b)(2)(C)(iii)) to a more prominent place in Rule 26(b)(1).

Under the revisions to Rule 26, discovery is limited to matters relevant to a claim or defense rather than permitting discovery into matters “reasonably calculated to lead to the discovery of admissible evidence.”

The committee believed that the “reasonably calculated” phrase “has been used by some, incorrectly, to define the scope of discovery” and that “use of the ‘reasonably calculated’ phrase . . . ‘might swallow any other limitation on the scope of discovery.'”

Rule 26 is also changed to address discovery proportionality. As amended Rule 26(b)(1) will read:

Scope in General. Unless otherwise limited by court order, the scope of discovery is as follows: Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit. Information within this scope of discovery need not be admissible to be evidence to be discoverable.

The notes accompanying revisions to Rule 26 state that the change “restores the proportionality factors to their original place in defining the scope of discovery reinforces the Rule 26(g) obligation of parties to consider [proportionality] factors in making discovery requests responses or objections.” Further to those ends Rules 30 and 31 (regarding depositions) and Rule 33 (regarding interrogatories) are amended to specifically reference proportionality considerations.

Notes to the rule emphasize that

[r]estoring the proportionality calculation to Rule 26(b)(1) does not change the existing responsibilities of the court and the parties to consider proportionality, and the change does not place on the party seeking discovery the burden of addressing all proportionality considerations. Nor is the change intended to permit the opposing party to refuse discovery simply by making a boilerplate objection that it is not proportional. The parties and the court have a collective responsibility to consider the proportionality of all discovery and consider it in resolving discovery disputes.

Rule 26 (and Rule 34), as amended, will also permit parties to “deliver” document requests to opponents prior to Rule 26(f) conferences. The requests will then be considered served at the conference. The change is made to facilitate discussions about discovery and document production at the Rule 26(f) conference.

Objections to Document Requests Require Specificity

Amendments to Rule 34 address objections to document requests. After amendment, objections must be made “with specificity” and state whether material is being withheld based upon objection. The rule is revised to limit confusion caused when a party objects to a document request, yet still produces responsive information.

Rule 34 is also amended to reflect the fact that rather than permitting inspection of documents, parties often produce copies of documents or ESI. Under changes to the rule, responses to document requests must indicate that copies are being produced and specify the time of production.

Finally, under changes to Rule 34, if a production is made in stages, the beginning and end dates of production must be specified in the response.

Serious Spoliation Sanctions Require Bad Faith

Some of the most significant amendments are to Rule 37. The committee revised Rule 37 to address a spilt among courts regarding the level of culpability required to issue severe sanctions for failing to preserve ESI (including adverse inferences). Some courts required only a finding of negligent failure to preserve, while other courts required a finding of bad faith.

Under Rule 37(e)(1) upon a finding that the loss of ESI prejudiced another party, courts may only “order measures no greater than necessary to cure the prejudice.” However, to impose serious sanctions, there must be a finding of bad faith. As amended, Rule 37(e)(2) will now require a finding that the offending party intended to deprive the other party of the lost information before issuing severe sanctions such as adverse inferences or dismissal.

The notes state that Rule 37(e)(2) is “designed to provide a uniform standard in federal court for use of these serious measures when addressing failure to preserve electronically stored information.” The committee also stated a belief that negligence and gross negligence does not logically support severe sanctions. Even in instances in which an intent to deprive another of evidence is found, the committee cautions courts that the “remedy should fit the wrong.”

The rule will now read:

(e) FAILURE TO PRESERVE ELECTRONICALLY STORED INFORMATION. If electronically stored information that should have been preserved in the anticipation or conduct of litigation is lost because a party failed to take reasonable steps to preserve the information, and the information cannot be restored or replaced through additional discovery, the court may:
(1) Upon finding of prejudice to another party from loss of the information, order measures no greater than necessary to cure the prejudice;
(2) Only upon a finding that the party acted with the intent to deprive another party of the information’s use in the litigation,
(A) presume that the lost information was unfavorable to the party;
(B) instruct the jury that it may or must presume the information was unfavorable to the party; or
(C) dismiss the action or enter a default judgment.

The Supreme Court transmittal letter to Congress may be found here.