2008-05-30 Spoliation: "Flagrant Reformatting," Tampering, and Backdating - Oh My!

In a May 16 opinion in the case of Johnson v Wells Fargo Home Mtg., Inc. 2008 WL 2142219 (D. Nev 2008), the Court found the plaintiff (who had asserted a Fair Credit Reporting Act violation against defendant) had spoliated digital evidence on his two laptops containing undisputedly relevant evidence, and sanctioned plaintiff by directing that an adverse inference instruction to a jury be made at trial in connection with the computer information contained on those computers. In an interesting twist of the "safe harbor" provisions of Fed. R. Civ. P. 37, the Plaintiff claimed that the reformatting/reinstallation was routine and necessitated (coincidentally, just after demand for them was made and noticed) because the laptops were infected with viruses spy-ware.

Defendant claimed severe prejudice and sought dismissal. Specifically, Defendant asserted (and had expert testimony corroborate) that it "has been prejudiced by Plaintiff's willful acts because relevant information that it could have used in defending against this lawsuit [was] forever lost.

The actions admitted to by plaintiff, or testified to by defendant's expert, pretty much cover the "what not to do" punch list in order to avoid a finding of discovery abuse. Note that some points are direct quotes from the decision:

1. Defendant contends Plaintiff supports his FCRA claim with various letters he drafted on his two laptops, which rest at the very foundation of Plaintiff's claim. Defendant further contends computer evidence reveals Plaintiff may have manufactured these documents to support his claim and then flagrantly reformatted the hard drives on these laptops shortly after Defendant informed him that they had been formally requested and were relevant to the case.

2. "Plaintiff claim[ed] that before this procedure is performed, data on the hard drive is backed up and saved and then downloaded back onto the hard drive after the operating system is reinstalled." Plaintiff failed to produce the backs ups themselves.

2. Plaintiff objected to the request for the laptops and instead offered to produce documents

specifically identified by defendant.

3. Plaintiff repeatedly refused to come to agreement concerning the hard drives, resulting in Defendant's filing of a motion to compel production of hard drives, which was granted.

4. After "eventually" receiving the hard drives, defendant's forensic expert determined that both had been re-formatted or "reinstall[ed]" prior to production.

5. Plaintiff claimed that his "original" files had been backed up, but did not provide the saved backups (created prior to the reformatting-reinstallation) themselves.


Defendant's Expert Testimony

1. Defendant's expert testified that the reformatted drives were not "searchable."

2. Plaintiff altered numbers on correspondence and checks, fabricated evidence to bolster his position.

3. Plaintiff both deleted files and then reformatted them. One laptop was reformatted by Plaintiff's wife, using telephonic instructions given to her by a computer technician.

4. "Within five (5) days of being notified that Defendant intended to file a motion to compel, Plaintiff reformatted his first hard drive ( Id., Exh. 1). Then within ten (10) days of reformatting his first hard drive, Plaintiff reformatted his second hard drive ( Id.). During this entire period of time, Defendant sent numerous e-mails to Plaintiff attempting to settle the dispute over production of the hard drives."


Spoliation: Motion to Dismiss Pursuant to Fed. R. Civ. P. Rule 37, and the Court's Inherent Power

Defendant requested dismissal for discovery violations pursuant to Fed. R. Civ. P. 37 and the Court's "inherent powers." The Court's analysis is instructive. The Court first explains that there are two ways in which a spoliation claim may be decided:

A Court may "...levy sanctions" in response to abusive litigation practices, and the availability of sanctions under Rule 37 against a party who ‘fails to obey an order to provide or permit discovery.’ ” Leon v. IDX Systems Corp., 464 F.3d 951, 958 (9th Cir.2006) (citing Fjelstad v. Am. Honda Motor Co., 762 F.2d 1334, 1337-1338 (9th Cir.1985); Fed R. Civ. P. 37(b)(2)(C)). "

In this case, there was no outstanding discovery order, and accordingly, the Court conducted its spoliation analysis based on it's "inherent powers."


The Court's Analysis:

The Court found that Plaintiff's actions were willful, that it had notice of the relevancy of the information contained in the hard drives that were reformatted,

Willfulness and Notice of Relevancy: The Court noted that,

"[T]he totality of the circumstances indicates Plaintiff's conduct was, in fact, willful. Plaintiff was clearly on notice that Defendant was seeking relevant information on his hard drives. “A party's destruction of evidence qualifies as willful spoliation if the party has ‘some notice that the documents were potentially relevant to the litigation before they were destroyed.’ ”Leon, 464 F.3d at 959 (citing United States v. Kitsap Physicians Serv., 314 F.3d 995, 1001 (9th Cir.2002) (emphasis added) (internal quotation marks and citation omitted))."

The Timing of Plaintiff's Acts was Suspect

"The timing of Plaintiff's reformatting of his hard drives is also very suspect. Plaintiff reformatted both hard drives within a few days of each other, not only during the period of time he knew Defendant sought production of the hard drives, but also after Defendant informed Plaintiff, on September 20, 2007, that it intended to file a motion to compel production of the hard drives."

The "Virus and Spy-Ware" Claims "Not Helpful" to Show Absence of Willfulness/Bad Faith

"Plaintiff's explanation that he reformatted his hard drives because they were infected with viruses and spy-ware and then he downloaded all the files back onto the hard drives is of little help to the court in finding an absence of willfulness or bad faith."

The Court also pointed out that at not time during demand for production or discussions held in connection therewith was this issue raised by Plaintiff. Another reason to find bad faith or willfulness.

Relationship Between Misconduct and Matters in Controversy

The Court found a clear relationship between Plaintiff's reformatting of the hard drives and the controversy.


Prejudice to Non-Spoliating Party:

The Court first sets out the elements for a finding of prejudice in the 9th Circuit:

“A defendant suffers prejudice if the plaintiff's actions impair the defendant's ability to go to trial or threaten to interfere with the rightful decision of the case.” Malone v. United States Postal Service, 833 F.2d 128, 130 (9th Cir.1987), cert. denied sub nom, Malone v. Frank, 488 U.S. 819, 109 S.Ct. 59, 102 L.Ed.2d 37 (1988). “Whether prejudice is sufficient to support an order of dismissal is in part judged with reference to the plaintiff's excuse for the [conduct].” Id. (citing Nealey v. Transportac ion Maritima Mexicana, S.A., 662 F.2d 1275, 1280 (9th Cir.1980)). Delay alone has been held to be insufficient prejudice; however, failure to produce documents as ordered is considered sufficient prejudice. Adriana Intern. Corp. v. Thoeren, 913 F.2d 1406, 1412 (9th Cir.1990), cert. denied, Lewis & Co. v. Thoeren, 498 U.S. 1109, 111 S.Ct. 1019, 112 L.Ed.2d 1100 (1991)."

The Court first points out that the issue being decided one of destruction of evidence rather than of a failure to produce:

"Here, we are not dealing with a failure to produce documents as ordered because Plaintiff reformatted his hard drives prior to the court ordering production of said hard drives."

The Court finds prejudice in part relying on the testimony of Defendant's expert:

"Defendant has shown some prejudice, nonetheless, based on expert testimony suggesting Plaintiff may have altered or manufactured relevant documents and that some documents may be missing."

The Court found that Plaintiff had spoliated computer generated evidence, and arguably the hard drive containing that evidence. The Court finds, however, that the spoliation by Plaintiff did not warrant the extreme sanction of dismissal, and conducted a "less drastic sanctions" analysis under 9th Circuit standards:

"In considering less drastic sanctions for spoliation of evidence, “[a] federal trial court has the inherent discretionary power to make appropriate evidentiary rulings in response to the destruction or spoliation of relevant evidence. Such power includes the power where appropriate to order the exclusion of certain evidence.” Glover v. BIC Corp., 6 F.3d 1318, 1329 (9th Cir.1993). “Short of excluding the disputed evidence, a trial court also has the broad discretionary power to permit a jury to draw an adverse inference from the destruction or spoliation against the party or witness responsible for that behavior.” Id. (citing Akiona v. United States, 938 F.2d 158 (9th Cir.1991)). A finding of “bad faith” is not a prerequisite to this corrective measure; a finding of “willfulness or fault by the offending party” will suffice. Unigard v. Lakewood, 982 F.2d 363, 368-370 & n. 2 (9th Cir.1992)."

The Court found first described the rationale for imposition of an adverse jury instruction sanction on a spoliating party:

"The adverse inference is based on two rationales, one evidentiary and one not. The evidentiary rationale is nothin [sic] more than the common sense observation that a party who has notice that a document is relevant to litigation and who proceeds to destroy the document is more likely to have been threatened by the document than is a party in the same position who does not destroy the document.... The other rationale for the inference has to do with its prophylactic and punitive effects. Allowing the trier of fact to draw the inference presumably deters parties from destroying relevant evidence before it can be introduced at trial. [Citation omitted]"

The Court then imposed an adverse inference instruction finding as the appropriate sanction in this matter:

"Here, an adverse jury instruction creating a presumption in favor of Defendant that the spoliated evidence was unfavorable to Plaintiff is an appropriate, less drastic sanction for several reasons set forth below."

The reasons?

"First, Defendant's forensic computer expert found evidence that Plaintiff tampered with the hard drives (Doc. # 129 at 6). Plaintiff does not dispute reformatting his hard drives during the period Defendant was requesting production of the hard drives. Although Plaintiff suggests he saved and backed up the data on his hard drives, he has failed to produce any saved, back-up files proving he did so. Plaintiff's credibility is solely within the province of the jury and the jurors will be able to draw they're own inferences based on the timing of Plaintiff's conduct and the failure to produce any saved back-up files."

"Second, Defendant's expert did retrieve two (2) letters from Plaintiff's hard drives, which, according to Defendant, “rest at the very foundation of Plaintiff's FCRA claim.” ( Id. at 3). Defendant's expert will apparently testify that Plaintiff created these documents more than one (1) year after Plaintiff claims he created them ( Id. at 8). Defendant's expert's analysis suggests Plaintiff created both of these documents just five (5) days before Plaintiff's counsel sent a letter to Defendant threatening suit and just one (1) month prior to Plaintiff filing this action (Doc. # 129 at 8). Plaintiff argues the allegation that the documents were created after the dates indicated on them is pure speculation and “completely meaningless unless it is known whether the date and time set on the computer were correct when the documents were created.” (Doc. # 133 at 5). However, as previously stated, Plaintiff's credibility is solely within the province of the jury and Defendant will have the opportunity to present evidence from its computer expert indicating Plaintiff backdated the letters. The jury can then weigh the evidence and determine whether Plaintiff's argument is credible, given the totality of the circumstances."

"Third, Defendant asserts that its computer expert retrieved information that shows Plaintiff may have been creating other documents in anticipation of litigation and backdating them to fit his theory of liability."

At first, I thought this Plaintiff must have been pro se. Incredibly, not so.

2008-05-23 Breath Test Administrator Affidavit is Testimonial Under Crawford v Washington - One Step Closer to the Data

This May 1, 2008 decision in State of Florida v Bruce Belvin, No. SC06-593 (FL 2008) appears to bring the issue of Crawford v Washington's application of 6th Amendment right-of-confrontation closer a holding that the computer information itself is testimonial in nature, and equally deserving of 6th Amendment right-to-confront protections.

In Belvin, the Florida Supreme Court overturned the Florida 4th District Court of Appeals decision holding that a breath test administrator's affidavit as to the procedures and observations was *not* testimonial hearsay. In that case, and over defense objections, the affidavit of the breath test administrator was admitted without requiring the administrator herself to testify. The Florida 4th DCA certified that issue to the Florida Supreme Court after making that ruling.

The Florida Supreme Court first discusses the history of the business records exception to the hearsay rule, and analyzes earlier U.S. Supreme Court precedent from Ohio v Roberts, 448 U.S. 56, 66 (1980):

"In Roberts the Court said that a hearsay statement could be admitted in a criminal trial without violating the right of confrontation if it was shown that the declarant was unavailable and the out-of-court statement bore adequate indicia of reliability."

Strange as it may seem, it appears that the Florida Supreme Court interprets the Crawford decision as doing away with "indicia of trustworthiness" test because...the test itself was unreliable, and more deserving of 6th Amendment right-to-confront protection. The Belvin Court then discusses that Crawford v Washington 541 US 36 (2004) discards the "indicia of reliability" test and replaces it with 6th Amendment right-of-confrontation protection:

"The standard for determining whether the admission of a hearsay statement against a criminal defendant violates the right of confrontation was modified by the Supreme Court in Crawford v. Washington. Before Crawford, the Confrontation Clause issue was controlled by Ohio v. Roberts, 448 U.S. 56, 66 (1980). In Roberts the Court said that a hearsay statement could be admitted in a criminal trial without violating the right of confrontation if it was shown that the declarant was unavailable and the out-of-court statement bore adequate indicia of reliability. "

Moreover, the Court notes:

"This test focused on the reliability of the statement. As explained in Roberts, a statement had adequate indicia of reliability if it either fell within a firmly rooted hearsay exception or if it bore ―particularized guarantees of trustworthiness. Id. However, in Crawford, the Supreme Court dispensed with the Roberts reliability analysis for testimonial hearsay and held the admission of a hearsay statement made by a declarant who does not testify at trial violates the Sixth Amendment if (1) the statement is testimonial, (2) the declarant is unavailable, and (3) the defendant lacked a prior opportunity for cross-examination of the declarant. The Court emphasized that if ―testimonial evidence is at issue, ―the Sixth Amendment demands what the common law required: unavailability and a prior opportunity for cross-examination. Crawford, 541 U.S. at 68. ―Only [testimonial statements] cause the declarant to be a ‗witness‘ within the meaning of the Confrontation Clause. Davis v. Washington, 547 U.S. 813, 821 (2006). ―It is the testimonial character of the statement that separates it from other hearsay that, while subject to traditional limitations upon hearsay evidence, is not subject to the Confrontation Clause. Id.

Thus, we must initially determine whether the breath test affidavit at issue in the instant case contains testimonial statements. While Crawford did not establish a precise definition for the term ―testimonial, the Supreme Court provided some guidance, holding that, at a minimum, statements are testimonial if the declarant made them at a ―preliminary hearing, before a grand jury, or at a former trial; and [in] police interrogations. Crawford, 541 U.S. at 68."

The Belvin Court then acknowledges that the affidavit is a "witness" and that the technician who created the affidavit did so to provide a "critical element" in the DUI criminal prosecution.

"Applying the rationales of Davis and Crawford to the instant case, we conclude that the breath test affidavit is testimonial. First, the affidavit was ―acting as a witness‖against the accused. Davis, 547 U.S. at 828; see Crawford, 541 U.S. at 51. The technician who created the breath test affidavit did so to prove a critical element in Belvin's DUI criminal prosecution. In other words, the breath test affidavit was created ―to establish or prove past events potentially relevant to later criminal prosecution. Davis, 547 U.S. at 822; see Thomas v. United States, 914 A.2d 1, 12-13 (D.C. Cir. 2006), cert. denied, 128 S. Ct. 241 (2007). Second, the affidavit was not created during an ongoing emergency or contemporaneously with the crime. Instead, it was created ―well after the criminal events had transpired."

The issue of contemporaneity is also discussed in the above excerpt, and acknowledgment again made that the affidavit in question was not contemporaneously created.

Using the Belvin decision rationale, we are perhaps one step closer to showing that it is the Breath-a-lyzer data itself, acting in concert with the computer environment generating that data, that establishes or proves the element of a DUI. The hint that an argument to that effect might be made:

"More precisely, the sole purpose of a breath test affidavit is to authenticate the results of the test for use at trial. See § 316.1934(5), Fla. Stat. (2007). "

Perhaps, if the argument is sufficiently well crafted, the computer information itself, rather than the affidavit of a technician interpreting that computer information, will itself be held sufficiently testimonial to invoke Crawford's 6th Amendment protection.



Link to the decision: http://www.floridasupremecourt.org/decisions/2008/sc06-593.pdf

2008-05-23 Data Maps and eDiscovery Protocol Deliberations - Discoverable?

The question raised is not only whether internal data maps generated for eDiscovery, but whether discussions about such data map generation, together with decisional processes on selection of eDiscovery protocols, etc., (where not agreed to in advance by both parties) are discoverable.

On the one hand, an argument may be made that these documents fall under the attorney-client privilege, or are attorney work-product, and may therefore be excluded from production. A good way to ensure the availability of these arguments is to make sure that all such deliberations and drafts pass through appropriately placed counsel. The effect, of course, is to "immunize" otherwise discoverable information from disclosure and use by the requesting party.

This approach has recently received some scrutiny and comment by US Magistrate Judge David Baker (Middle District, Florida) and does not bode well for the longevity or vitality of the approach:

A leading treatise author, Paul R. Rice, has recognized the practice of businesses who may try to “immunize internal [business] communications from discovery by placing legal counsel in strategic corporate positions and funneling documents through counsel.” 1 Paul R. Rice, Attorney-Client Privilege in The United States § 7:2. “There is general agreement that the protection of the privilege applies only if the primary or predominate purpose of the attorney-client consultations is to seek legal advice or assistance.” Id. § 7:5. “There are substantial policy reasons for holding that business documents submitted for attorney review are not by that virtue automatically exempt as privileged or work product protected communications.” Visa USA, Inc. v. First Data Corp, 2004 WL 1878209, 8 (N.D.Cal.2004).

The structure of certain business enterprises, when their legal departments have broad powers, and the manner in which they circulate documents is broad, has consequences that those companies must live with relative to their burden of persuasion when privilege is asserted. See, e.g., In re Vioxx Products Liability Litigation, 501 F.Supp.2d 789, 805 (E.D.La.2007). When the business “simultaneously sends communications to both lawyers and non-lawyers, it usually cannot claim that the primary purpose of the communication was for legal advice or assistance because the communication served both business and legal purposes.” Id. (citing United States v. Chevron Corp., 1996 WL 444597 (N.D.Cal.1996)); United States v. International Business Machines Corp., 66 F.R.D. 206, 213 (S.D.N.Y.1974) (“If the document was prepared for purposes of simultaneous review by legal and non-legal personnel, it cannot be said that the primary purpose of the document is to secure legal advice.”). Consequently, the privilege does not protect such communications. In re Vioxx, 501 F.Supp.2d at 805; Attorney-Client Privilege § 7.2.1 (“Because of the ease with which e-mail technology allows in-house counsel to be brought into discussions, counsel are contacted far more frequently, and through those contacts, are likely encouraged to participate in regular business matters far more frequently and broadly than was the case in the past.”). Judge Fallon, incorporating the report from Special Master Rice FN4, explained the reasoning:
FN4. Judge Fallon selected as Special Master for privilege document discovery Professor Paul R. Rice, author of the treatise, Attorney-Client Privilege in the United States.

When these simultaneous conveyances for mixed purposes are through an e-mail message that lists the lawyers' names in the header of the e-mail message, [the defendant] Merck is revealing the contents of the single message that may have been conveyed to its lawyer primarily for legal assistance. In that circumstance, the single message could have been withheld as a privileged communication had Merck sent blind copies to the lawyers, instead of electing this format. Through a blind copy, the content of what was communicated to its attorney would have remained confidential after future discovery of the document from the other recipient's files, its purpose would have been primarily legal, and the privilege would have been applicable. Similarly, if Merck had sent a wholly separate e-mail communication with the same materials to the lawyer, the same claim could be successfully made for that single communication even though it otherwise served mixed purposes. In modern vernacular, Merck, in a variety of instances, “could have had a V-8,” but it chose another format and manner of document circulation and cannot now be heard to complain about the consequences of those choices. Otherwise, Merck would be able to limit the scope of what adversaries can discover by the way in which it chooses to communicate.

*5 Similarly, after a communication with its attachment has been sent to both lawyers and non-lawyers in the same e-mail communication, and its primary purpose is determined not to have been for obtaining legal advice, the lawyer's independent response can only be protected if the derivative nature of the privilege is ignored. Theoretically, the lawyer's response should be protected only if it reveals the content of prior confidential communications from the client. Since those communications are no longer confidential, nothing the lawyer discloses in her edits reveals protected communications of the client. 501 F.Supp.2d at 805-06." In re Seroquel Products Liability Litigation 2008 WL 1995058, 4 -5 (M.D.Fla.,2008)

2008-05-12 Want Native Format Data? Make Sure to Ask for It

In an April 2, 2008 decision in the case of Autotech Technologies Ltd. Partnership v. Automationdirect.com, Inc. --- F.R.D. ----, 2008 WL 902957 (N.D.Ill. 2008), the Court followed Magistrate Judge Facciola's line of reasoning in D'Onofrio v SFX Sports Group Inc. and held that a late "clarification" (quotes mine) is insufficient to save a defective request omitting a specific directive to produce native format data.

"It seems a little late to ask for metadata after documents responsive to a request have been produced in both paper and electronic format. Ordinarily, courts will not compel the production of metadata when a party did not make that a part of its request." See D'Onofrio, 247 F.R.D. at 48 (D.D.C.2008); Wyeth v. Impax Labs., Inc., No. Civ. A. 06-222-JJF, 248 F.R.D. 169, ----, 2006 WL 3091331, at *1-2 (D.Del.2006) (“Since the parties have never agreed that electronic documents would be produced in any particular format, [Plaintiff] complied with its discovery obligation by producing image files”). "

Held: .pdf and paper printouts sufficient. Motion to compel denied.

Bonus: Good definition of metadata in Footnote 1:

"Metadata, commonly described as “data about data,” is defined as “a set of data that describes and gives information about other data” or “information about a particular data set which describes how, when and by whom it was collected, created, accessed, or modified and how it is formatted (including data demographics such as size, location, storage requirements and media information).” It includes all of the contextual, processing, and use information needed to identify and certify the scope, authenticity, and integrity of active or archival electronic information or records. Some examples of metadata for electronic documents include: a file's name, a file's location ( e.g., directory structure or pathname), file format or file type, file size, file dates ( e.g., creation date, date of last data modification, date of last data access, and date of last metadata modification), and file permissions ( e.g., who can read the data, who can write to it, who can run it). Some metadata, such as file dates and sizes, can easily be seen by users; other metadata can be hidden or embedded and unavailable to computer users who are not technically adept. Scotts Co. LLC v. Liberty Mut. Ins. Co., 2007 WL 1723509, *3 n. 2 (S.D.Ohio June 12, 2007) (citations omitted)."