For some odd reason – odd because I’m not a lawyer and not really in the biz – I’m fascinated by the goings-on in the e-discovery world and avidly follow a number of e-discovery blogs. The thing that really fascinates me is that while courts often rule in counter intuitive ways, the caricature of judges as technophobic Luddites is often dispelled with extreme prejudice when one actually reads the rulings – often to the chagrin of litigants who were banking on that caricature being accurate.
Consider this case reported in the Electronic Discovery Blog where the defendant decided that if the evidence were destroyed that there would be no case. Sorry, no cigar.
The magistrate judge had previously ordered defendant producer to produce computers for forensic examination. When the expert arrived [the defendant] refused to produce a laptop for nearly two hours. When the laptop was finally produced, requestors found “that ‘it was hot to the touch and a screw was missing from its hard drive enclosure.’” The court subsequently appointed a forensic expert to analyze the laptop.
Producers responded by admitting many of the allegations raised by the court’s expert. A computer technician admitted reinstalling the operating system shortly before the imaging took place. He changed the clock “to determine whether old files had expired.” Over 12,000 files were copied onto the laptop by the technician, and had searched for programs to help retrieve the data, including “Kill Disk” and “Get Data Back.”
The court concluded that “plaintiffs have demonstrated that [the defendant] spoliated the laptop.” The duty to preserve the laptop arose on when plaintiff requestors had filed their action. “At a minimum, [the defendant] behaved negligently when he provided [the computer technician] the laptop and asked him to remove potentially embarrassing files without informing him that the laptop’s contents constituted evidence in ongoing litigation.”
The spoliated computer files might have related to any one or more of the claims. Because defendant spoliated the files, “it is impossible to identify which files [were relevant to plaintiff’s claims] and how they might have been used.”… Accordingly, “it is impossible to know what [plaintiffs] would have found if [defendants] and [their] counsel had complied with their discovery obligations.”
Accordingly, the court found that the only appropriate sanction would be a default judgment in plaintiff requestor’s favor. The court noted that previous sanctions against defendants had failed to deter discovery misconduct. In addition, “the most serious forms of spoliation merit the harshest sanctions, and in this case, the destruction of evidence was of the worst sort: intentional, thoroughgoing, and (unsuccessfully) concealed.”
So if you destroy the evidence, the court can only assume the whatever might have been there was really, really bad. Guilty! Thank you, that is all.
Or how about this case reported in Electronic Discovery Law. We’ve always thought – well I’ve always thought – that your spouse could not be compelled to testify against you. Not so fast, buckaroo!
In April 2002, former Broadcom CEO, Henry Nicholas, used his company laptop and email account to send an email to his then-wife discussing his children, his marriage, his drug use, and various issues related to Broadcom. Quotations from the email included:
• “The worst part is the company falling apart because I am not fully functioning.”
• “However, I don’t care about Broadcom anymore…I just feel like a liar to the people I am recruiting to new positions…because I am potentially f—ing some things up this week that will be irreparably damaging.”
• “However, I am willing to lie and bulls— to get key people in place so I can extract myself from Broadcom as soon as possible”
Nicholas also referenced “suffering ecstasy come-down” and “panic attacks” and “electric shock like flashes” upon quitting “cold turkey,” among other things.
In 2002, the email was discovered by an IT staff member engaged in authorized maintenance and was subsequently provided to another member of the IT staff acting on instructions of the Board to gather information regarding concerns over Nicholas’s behavior. Between 2002 and 2007, when the email was disclosed to the government in the course of their investigation of Broadcom’s stock option practices, many people at Broadcom became aware of the email, including General Counsel, the Co-Chairman of the Board of Directors, and the Director of Human Resources.
Extensive motions practice ensued regarding potential protection of the email by the marital privilege.
As the Ninth Circuit recognized, the Email may be admissible at trial notwithstanding the privilege. The Court will have to make the ultimate determination of the Email’s admissibility at trial after considering all of the facts and circumstances at that time. Because the Email may be admissible at trial, in fairness, the Email must now be disclosed to [the co-defendant]. Finally, in light of the disclosure of the contents of the Email by the Orange County Register, the Court finds no compelling interest in keeping this order under seal.
In reaching this determination, the district court first examined the scope of the Ninth Circuit’s ruling regarding the applicability of the marital privilege and relevant precedent regarding the same. Accordingly, the district court stated:
[P]recluding the use of the Email for any purpose would exceed the “appropriate scope of the protection” to which the Email is entitled. Evidentiary privileges are not absolute, and the jury’s obligation to consider relevant, probative, evidence may outweigh any interest in keeping privileged information from it.
Yeah. Be real careful what you email – even to your spouse. Also you probably shouldn’t send email when you’re baked. Or try to run a major corporation.
And then there’s this case from Electronic Discovery Blog wherein a clever guy hatched a plan for milking the DRAM industry with surprise licensing fees but was careful to cover his tracks before launching the dastardly plan.
Rambus is a developer and manufacturer of computer memory chips. As a result of meetings among other chip technology owners, manufacturers and purchasers in 1991 to develop industry-wide standards for memory chips, Rambus became concerned that chip manufacturers were using its technology to develop competing chips. In 1996 and 1997, Rambus “planned to create a patent ‘minefield’ that it could use to its advantage in dealing with other companies in the industry.” In October, 1997, Rambus hired Joel Karp as VP of Intellectual Property, who would be responsible for “assessing [the Rambus] patent portfolio, determining when chips infringe [the Rambus] patent portfolio, setting licensing strategies for infringing chips, and for negotiations with companies that build and sell infringing chips.”
Karp met with several attorneys to discuss licensing and litigation strategy and discussed preparing trial graphics and claims; retaining experts; gathering critical documents and implementing a document retention policy; and building a case against potential litigation targets. A memorandum for the Board was prepared which “discusses Rambus’ competitors, features of the licensing program and a hierarchy of potential licensees and, in the event that licensing efforts failed, a tiered litigation strategy contemplating litigation in fora that “proceed at an accelerated schedule,” making early preparation advantageous for Rambus.” In his presentation to the Board, Karp told them “that the document retention policy was necessary to prepare for the ‘upcoming battle.’”
“One of the reasons for implementing the policy was to allow Rambus to purge documents, including emails, from its files that might be discoverable in litigation.” In May, 1998, Karp sent an email to Rambus employees “announcing that, effective immediately, full system back-up tapes would be saved for only three months and that data to be saved beyond three months must be archived separately…. Karp also announced the imminent implementation of a company-wide document retention policy.”
In September, 1998, Rambus employees participated in “Shred Day”, during which about 400 banker’s boxes of documents were destroyed, “relating to contract and licensing negotiations, patent prosecution, JEDEC and Board meetings, and finances.”
The court concluded that “[i]t is apparent from the record that Rambus, from its inception, was prepared to be an aggressive competitor in a very competitive industry. Its patent portfolio was considered a weapon to be used, as necessary, in its chosen theater of operations, the DRAM market. Under these circumstances, one could safely predict that litigation was inevitable.”
The duty to preserve arose “no later than December, 1998, when Karp had articulated a time frame and a motive for implementation of the Rambus litigation strategy.” Because the document retention policy was discussed in the context of this litigation strategy,
the court found that Rambus knew, or should have known, that a general implementation of the policy was inappropriate because the documents destroyed would become material at some point in the future. Therefore, a duty to preserve potentially relevant evidence arose in December 1998 and any documents purged from that time forward are deemed to have been intentionally destroyed, i.e., destroyed in bad faith.
The spoliation conduct was extensive, including within its scope the destruction of innumerable documents relating to all aspects of Rambus’ business; when considered in light of Rambus’ litigation conduct, the very integrity of the litigation process has been impugned. Therefore, the court concluded that the appropriate sanction for the conduct of record is to declare the patents in suit unenforceable.
Curses foiled again by that “duty to preserve” thing. Great way to bury a promising technology under a mountain of greed.
And finally a P.T. Barnum-esque observation by my favorite e-discovery blogger, Sharon D. Nelson, Esq. in her {ride the lightening} blog regarding social networks.
Theglobeandmail.com has just reported that (according to Nielsen) one in every eleven minutes spent online is spent on a social networking or blogging site. Consider the veritable avalanche of electronic evidence that will result, much of it written in haste and ill-considered.
Apparently there’s more than just one born every minute.
This weekend we volunteered at the FIRST Robotics Challenge Colorado Regional. Not only is this a ton of fun – teams of high school students build robots to compete in a different game each year – it’s a very important activity to encourage young people to get involved in technology.
Not sure what is is with me and e-discovery this week, but I had to mention this as soon as I heard about it. 
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