By James D. Shook, Esq.

In the cult-classic “Weekend At Bernie’s”[1], two young men try to fool others into believing that their murdered boss is still alive, despite strong evidence to the contrary.  Of course, trying to keep up appearances with a decaying body gets more and more difficult with time, but they persist.  Eventually, they are found out – but in true Hollywood fashion, all ends well.

Have we now reached the same point with end-user based eDiscovery?

End-user or Custodian-based eDiscovery is the practice of relying almost entirely upon end-user employees to identify, preserve and collect data for a specific case.[2] There are good reasons that end-user eDiscovery became popular – it’s relatively easy and quick to create and administer a process; very little (if any) technology needs to be understood, purchased or deployed; and, under the proper circumstances, it can be reasonably defensible.  In addition, the process of relying on end-users to preserve and collect relevant information has its roots in the old paper days of discovery, which means that many lawyers are very comfortable with the process.

However, end-user eDiscovery has seen a steady stream of detractors who have pointed out its many flaws.[3] More recently, the number of detractors seems to have grown, and the detractors now include the only group that really matters for eDiscovery – the courts.  Recent cases have indicated little patience for a process where legal abdicates its responsibility for eDiscovery to end-users, and many cases have resulted in sanctions.

Here are a few of the key risks inherent in relying on end-user custodians for eDiscovery:

Employee Self Interest.  Many litigation matters involve employees who may have a significant personal interest in hiding data, even if they are not a named party.  When these interested parties are asked to identify, preserve and collect data that is relevant to a case – data that they believe would be embarrassing or harmful to them – it can be a difficult process to defend.

It is unreasonable to allow a party’s interested employees to make the decision about the relevance of such documents, especially when those same employees have the ability to permanently delete unfavorable email from a party’s system…. Furthermore, employees are often reluctant to reveal their mistakes or misdeeds.[4]

Lack of Legal Knowledge. The proper scope of discovery – which dictates what information must be preserved and collected — can be difficult to determine, especially early in the case when preservation is required.

For example, in a routine breach of contract case, one would expect an employee to search for information about the parties arguing over whether they have lived up to their contractual obligations.  However, the true scope of discovery could be broader and include communications about the negotiation process, which would have occurred earlier.  Additionally, information through the years about the course of conduct of the parties, evidenced by emails, documents and other ESI, might also be relevant to establish if the terms of the agreement had bee modified.  Most end-users would not understand that this data would be appropriate for discovery:

Most non-lawyer employees, whether marketing consultants or high school deans, do not have enough knowledge of the applicable law to correctly recognize which documents are relevant to a lawsuit and which are not.[5]

Lack of Control.  Courts are also less comfortable when an attorney – who is both trained in the legal process and also directly subject to the power of the court — is not taking a lead role in the process.  The Pension Committee court found the process employed by certain defendants to be fatally flawed because it “places total reliance on the employee to search and select what that employee believed to be responsive records without any supervision from Counsel.”[6] Similarly, at least one other court found that a responding party violated its duty to preserve information because the defendant’s preservation practices “place operations-level employees in the position of deciding what information is relevant.”[7]

Other risks inherent to an end-user based process include:

• System Complexity:  How can custodians identify and preserve data if the system is complex and difficult to understand;
• Hold Risk:  If employees are preserving the data on their own, what is the risk that a device (flash drive, laptop, etc.) may fail, be destroyed, legitimately lost or mistakenly overwritten;
• Metadata Spoliation:  While not all cases are concerned with metadata, having employees preserve and self-collect ESI will, in most cases, result in changes to the metadata.

After cases like Pension Committee, Jones and Cache La Poudre[8] – is end-user based ediscovery as dead as Bernie?  As with other eDiscovery issues, there’s never been a requirement to be “perfect”[9], so the process must be evaluated on a sliding scale, risk-reward basis, and hopefully including the legal notion of proportionality in the analysis.  In matters where the employee is truly uninterested (no risk of embarrassment, diminished job prospects, sanctions, etc.) but not disinterested, the systems involved are not complex, the legal and discovery issues are straightforward and potential changes to metadata are unimportant, the process is probably acceptable, at least if there is strong legal oversight.  Short of having that perfect storm of factors?  There will be risk, and based on recent decisions, that risk is probably growing.  We may all need to face up to the fact that Uncle Bernie is gone for good.

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[1] For the full IMDB treatment of the movie, see http://www.imdb.com/title/tt0098627 (last accessed 8/4/10).

[2] . See, e.g. “Don’t Be An EDiscovery Ostrich”, J. Shook, available at http://www.kmworld.com/Articles/White-Paper/Article/Don%27t-Be-An-E-Discovery-Ostrich-60457.aspx (last accessed 8/4/10; registration may be required).

[3] See “Avoiding Faux eDiscovery”, J. Shook and A. Cohen, March 2008, available at http://andrewsblog.typepad.com/andrew/files/faux_e_discovery.pdf (last accessed 8/4/10).  For those of you who read footnotes – yes, I realize that I’m an author of both cited articles.  If you know of other articles on this same point, please send them to me and I will update!  Shook_jim@emc.com.

[4] Jones v. Bremen High School Dist. 228, 2010 WL 2106640 (N.D. Ill. May 25, 2010)

[5] Jones, supra.

[6] Pension Committee v. Banc of America Securities, LLC, 2010 WL 184312 (S.D.N.Y. Jan. 15, 2010), note 68.

[7] Adams v Dell, 621 F.Supp. 2d 1173, 1194 (D. Utah 2009).

[8] Cache La Poudre Feed, LLC v. Land O’’ Lakes Inc., 244 F.R.D. 614 (D. Colo. 2007).

[9] “Courts cannot and do not expect that any party can meet a standard of perfection.”  Pension Committee at 2.