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Federal Rules Advisory Committee Scraps Proposed Rule 37(e)

Posted on April 9th, 2014

After over 2,000 public comments, the Federal Rules Advisory Committee has decided to rewrite the proposed changes to Rule 37(e). As we noted in our newsletter on the controversy of Rule 37(e), the proposed Rule would impose higher burdens upon parties seeking sanctions for spoliation of electronic evidence. In most class action lawsuits and MDLs, the defense production is usually much larger than any plaintiff ESI sought and therefore, the new rule would negatively affect plaintiffs in large-scale litigation. This is why plaintiff trial attorneys and defense counsel generally disagree on whether the proposed Rule 37(e) is a good change.

The Advisory Committee just published its notes from the Discovery Subcommittee Report on Rule 37(e). (Go to page 369 of the PDF file.) The Committee noted that the original rule was published in 2006, and the Duke Conference agreed that the time has come to update the rule in 2010. The goals were to established greater uniformity regarding lost or destroyed ESI and to reduce massive and costly over-preservation. While the draft rule attempted to hammer out definitive guidelines, the committee recognized that the diversity of federal jurisdiction may be too great for specific guidelines to apply in all cases.

The Committee noted that both the old and the new Rule 37(e) do not create the duty to preserve evidence, this duty arises by case law. Some corporate and defense attorneys wanted the rule to eliminate the duty to preserve before litigation was filed, the Subcommittee disagreed and recognized that such a rule would result in the loss or destruction of relevant ESI.

The Subcommittee reiterated the need for a general rule in civil litigation that addresses the loss of ESI. It noted the explosion of ESI over the last decade, that the preservation of ESI is a major issue for litigators, attorneys and the courts and the loss of ESI has produced a “bewildering” number of disputes. Further, there is currently a split in the circuits. The Second District (where Judge Shira Scheindlin’s Sekisui case and Zubulake cases were decided) allow for sanctions when negligent or gross negligence results in lost ESI. The Tenth Circuit, on the other hand, requires a showing of bad faith (higher than a showing of negligence) in order to impose sanctions.

The Subcommittee appears to attempt a balance between over-preservation of ESI with the very real concern that courts do need some discretion for imposing sanctions when ESI is lost. Did they listen to the 2,000+ comments? In our next post, our discussion of the Subcommittee Report continues with the text of the new proposed rule.

ILS – Plaintiff eDiscovery Experts

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