E-Discovery Ethics

New Jersey Law Journal May 4, 2016

E-Discovery Ethics: Let's Be Reasonable

Bick is of counsel at Brach Eichler in Roseland. He is also an adjunct professor at Pace and Rutgers law schools, and the author of "101 Things You Need to Know About Internet Law" (Random House 2000).

E-discovery is likely to be as important as traditional discovery because relevant information is as likely to be found on phones, websites, Facebook, e-mail and voicemail messages, as it is in a file cabinet. Although attorneys are rapidly becoming familiar with structuring digital data requests and responding to those requests in a way that is thorough, but reasonable, most attorneys feel at sea in the e-discovery ethics arena. New Jersey and more than a dozen other states have addressed e-discovery ethics and have concluded that "reasonability" is the standard by which ethical digital behavior will be judged.

For example, the N.J. Advisory Committee on Professional Ethics Opinion 701 (2006) found that an attorney may use the Internet to communicate with clients and store client files, provided that the attorney uses reasonable care. This New Jersey ethics opinion also requires New Jersey attorneys to make a reasonable effort to provide security on the Internet against hacking and other forms of unauthorized use of digital information. Additionally, New Jersey attorneys are required to use reasonable care to prevent against unauthorized disclosure of digital documents with which the lawyer has been entrusted, as well as reasonable care to ensure that digital documents entrusted to a third party for analysis are preserved, confidential and secure according to the same ethics opinion.

Applying this standard to the discovery process suggests certain actions. While the evolution of the Internet will require some evolution in these actions, since nearly every case involves some form of evidence stored electronically—in databases, email servers, cellphones, social media networks and the cloud—attorneys are likely to adjust to such new technology by applying existing discovery ethics to e-discovery by analogy.

Furthermore, the New Jersey reasonability standard applies to a requirement that New Jersey attorneys be reasonably educated in Internet-related technology. As noted in Ethics Opinion 701, New Jersey attorneys are considered reasonably competent regarding e-discovery when they avoid being rendered useless, and can maintain the duty of confidentiality, as well as competently overseeing nonlawyers, including e-discovery experts.

Specifically, this ethical requirement means that New Jersey litigators must be able to assess e-discovery needs and issues, understand certain e-discovery terminology such as ESI ("electronically stored information," which refers to all information stored in computers and storage devices), implement appropriate ESI preservation procedures, and effectively advise the client on available options for collection and preservation of ESI and related custodians. Other reasonable e-discovery competencies include assessing the relevant ESI, ability to engage in competent and meaningful meetings and confer with opposing counsel concerning an e-discovery plan, direct digital data searches, harvest responsive ESI and prepare responsive nonprivileged ESI.

Initially, preserving ESI is the most important matter with respect to e-discovery. Among the first e-discovery activities with respect to digital data preservation is a litigation hold. A litigation hold is a demand issued by an attorney to entities associated with a matter who may possess potentially relevant documents (including ESI) that directs those custodians to preserve such documents, pending further direction. Failure to issue an ESI litigation hold, as well as failure to enforce it, may subject a lawyer to ethical and litigation sanctions. In Scentsy v. B.R. Chase (D. Idaho Oct. 2, 2012), the court found that failure to execute an ESI litigation hold would result in the dismissal of the case if any ESI any destruction was revealed.

It would be unreasonable for an attorney to pass the responsibility to preserve documents on to a client upon the implementation of a litigation hold. Rather, an attorney must remain actively involved to ensure the hold is executed, or else both the lawyer and the client may suffer sanctions.

As a result, applying a "reasonability" standard, it would be reasonable for a New Jersey attorney to recommend to a litigation client to regularly monitor a legal hold to ensure compliance by requiring ongoing certifications from custodians. It may also be reasonable for a New Jersey attorney to monitor such certifications, as well as recommend that clients deploy legal hold automation software and dedicated "legal hold" servers to facilitate client compliance.

Since it is reasonable for an attorney to know that a computer is only one source of ESI, a New Jersey attorney is most likely responsible for counseling a client to refrain from Facebook comments, to honor an ethical duty to preserve evidence. The duty to preserve ESI includes text messages and other information stored on a party's cellphone. Thus, it is reasonable for a New Jersey attorney to educate a client on the importance of electronic evidence. Besides, to comply with a reasonable standard as related to ethical duties, a New Jersey attorney must make an active effort to understand his client's electronic storage, contact custodians of documents in order to mandate preservation and monitor compliance with such directions—and do all these things across all forms of ESI.

ESI may result in an ethical duty to preserve a massive amount of data. Nevertheless, it is reasonable that a New Jersey attorney has an ethical obligation to protect privileged documents.

To properly address this ethical obligation, it is reasonable for New Jersey attorneys to determine what search terms could result in harm to a client prior to discussing appropriate searches of a client's database with opposing counsel, or allowing a vendor unfettered access to his client's network. A failure to protect privileged data might also result from a New Jersey attorney's reasonable effort to monitor the vendor or reasonably review the data the vendor gathered. A litigator may ameliorate personal responsibility to comply with an ethical obligation to protect privileged documents by hiring an e-discovery expert to consult on the case. This option is particularly relevant to New Jersey attorneys who are not able to actively supervise searches due to a lack of time or expertise.

Delegation is not a panacea. E-discovery experts may be useful for expediting discovery and guiding a lawyer through an otherwise unmanageable maze of documents. However, the lawyer, not the expert, is ultimately responsible for a breach of ethics because the attorney must be certain never to certify the completeness of discovery responses without a "reasonable inquiry" under Federal Rule of Civil Procedure 26(g), or risk being liable for court-imposed sanctions.

The risk of accidentally producing privileged material is significant due to the nature and volume of ESI, as well as the involvement of third-party experts. Thus, in the event of an error, lawyers rely on claw-back provisions and Federal Rule of Evidence 502(b)—which allows certain inadvertent disclosures to not act as a waiver of privilege—for protection in the event of inadvertently disclosed documents. The relative novelty of ESI makes the execution of this option more palatable for both attorneys and the courts.

However, a claim of "inadvertent disclosure" is not enough to protect accidentally produced, privileged documents. Unless a New Jersey attorney has taken reasonable steps to prevent the inadvertent disclosure, he will be deemed to have waived the privilege, despite his reasonable efforts to correct the error on the back end.