New Federal Cases Spotlight 2021’s Key Trends in eDiscovery

Recent case law continues to reflect key trends in eDiscovery, ranging from the propriety of forensic examinations to ESI spoliation. While an order requiring a forensic collection of a party’s devices has generally been a disfavored remedy, courts now seem more willing to consider this as an option to prevent spoliation of ESI. Regarding ESI spoliation cases, courts have recently emphasized two additional issues. First, parties who preserve lesser forms of ESI like screenshots that do not adequately capture metadata may face severe procedural and evidentiary consequences. Second, counsel have an ethical obligation to inform the court and adversaries regarding ESI preservation failings.[1]

Forensic Examinations of Electronic Devices

Measured Wealth Private Client Group v. Foster is one of several recent cases in which courts have ordered the appointment of a forensic expert to create images of smartphones and other client devices.[2] In Measured Wealth, the defendant failed to produce relevant iMessages and SMS text messages. In response, plaintiff sought the appointment of a forensic expert to image defendant’s phone and thereby ensure the relevant messages were preserved and produced.

After reviewing the parties’ respective positions, Magistrate Judge William Matthewman ordered the appointment of an independent forensics expert to image defendant’s phone in order “to put an end to this discovery dispute.” Because defendant “agreed to produce certain text messages and iMessages at one time and then failed to do so,” the court reasoned that taking a forensic image would help “ensure that all relevant and proportional discovery is produced in this case.” Citing to District Judge Iain Johnston’s decision in DR Distributors v. 21 Century Smoking, Judge Matthewman closed by warning that “[s]erious sanctions can issue if e-discovery preservation, search, or production is inadequate.”

The increase in orders directing the imaging of devices is significant. While still a disfavored remedy, courts are seemingly turning to forensic imaging to prevent the loss of dynamic content such as text messages that are easily subject to modification and deletion. Parties should be aware of this trend and cognizant that engaging in obstructionist conduct—like the defendant in Measured Wealth—may lead to this type of remedy.

ESI Spoliation—ESI Evidence

Recent cases also make clear that parties who preserve lesser forms of ESI (such as screenshots) that do not adequately capture metadata may face harsh consequences. For example, the court in Edwards v. Junior State of America Foundation imposed multiple preclusion sanctions under Federal Rules of Civil Procedure 37(c) and 37(e)(1) to address plaintiff’s failure to preserve exported versions of Facebook Messenger messages.[3]

Plaintiff took screenshots of communications allegedly containing “racist and homophobic messages” he received on Facebook Messenger. Despite those messages being the key evidence in the case, plaintiff failed to produce those messages in an export format (JSON or HTML) that would have preserved their metadata. After prevaricating for several years, plaintiff finally acknowledged during sanctions motion practice that the actual messages were lost forever since he permanently deleted his Facebook account.

Under FRCP 37(e), the court found that relevant ESI was “lost” despite the existence of the message screenshots. The court held the screenshots would not satisfy the Original Documents Rule because they did not “‘accurately’ reflect the information” shared on the actual messages pursuant to Federal Rule of Evidence 1001(d). Instead, the court determined that only an “original” of the exported messages would suffice given the questions raised regarding the genuineness of the message screenshots.

Edwards is particularly instructive regarding the need to preserve and produce admissible ESI evidence. For years, courts have warned about the evidentiary perils of using screenshots to preserve certain ESI. While those admonitions have generally focused on authentication requirements, Edwards teaches that screenshots may run afoul of other evidentiary rules including the Original Documents Rule. Unless admissible ESI evidence is preserved, litigants may be unable to substantiate their claims or positions in dispositive motion practice, trial, or, as Edwards teaches, in connection with ESI spoliation motions.

ESI Spoliation—Ethical Duty to Inform the Court and Adversaries

Courts have recently expounded on counsel’s ethical duty to inform the court and adversaries regarding client ESI preservation failures. In Charlestown Capital Advisors v. Acero Junction (S.D.N.Y. Sept. 30, 2020), the court expressed frustration with defendants’ lawyers for their “obfuscations and misdirections” that allowed defendants “to conceal the fact of [their ESI] spoliation for months.”[4] Implicit in this rebuke was the court’s expectation that counsel should have disclosed defendants’ spoliation event—which resulted in the loss of thousands of emails and the imposition of FRCP 37(e)(1) sanctions—to the court and plaintiffs.

While the Charlestown court did not find that defendants’ counsel violated the rules of professional conduct, other lawyers have not been so fortunate. For instance, the court in DR Distributorsv. 21 Century Smoking found that defendants’ lawyers generally violated “rules requiring candor to the court and fairness to the opposing party and counsel” by failing to disclose defendants’ spoliation of relevant emails.[5] Judge Johnston observed that lead counsel had known of the fact of spoliation “for over a year,” but neglected to disclose this information either to the court or to plaintiff’s counsel. While not specifying which ethics rules had been violated, the court repeatedly referenced Rules 3.3, 3.4, and 8.4 in its analysis.

Even though Charlestown Capital and DR Distributors make clear that counsel have a duty to disclose information relating to ESI spoliation, they do not delineate precisely when counsel must do so. While there are benefits to promptly raising and addressing spoliation issues, counsel for a preserving party should have the option to investigate and remediate those issues before being forced to divulge this information. Indeed, neither Charlestown Capital nor DR Distributors require the immediate disclosure of spoliation events. Those courts were exasperated that counsel respectively waited “months” or “over a year” to disclose spoliation problems. Instead, these cases should be read as spotlighting counsel’s obligation to disclose client spoliation, but only after a reasonable time during which counsel may explore the issues and work with the client to ameliorate any resulting harm.

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