Advances in technology have brought the world to our fingertips. Cell phones, WiFi and the Internet have dramatically changed how and where we communicate. Times have changed and the new rules regarding electronic discovery must change as well. Read more for a synopsis of the amendments along with some observations about their impact.

For the last six years, the best minds of the bench and bar have been shepherding through important amendments to the Federal Rules of Civil Procedure. These amendments all address discovery of electronic evidence and take effect on December 1, 2006. The last time the federal rules were changed to accommodate electronic evidence, eight-track tapes were the hot technology, the Internet and cell phones were science fiction and computers were room-sized behemoths only big companies, universities and the government could afford.

Computers are now unfathomably more powerful than those that landed man on the moon, yet cost so little that almost every American has one or two. It's routine to wirelessly connect to a virtual library a million times larger than any physical one while sitting at a café chatting with a colleague who's aboard an airplane half a world away using an iPod to watch a feature film downloaded from the Internet. Times have certainly changed, and the Rules must change with the times. Here's a synopsis of the amendments, along with some observations about their operation and impact.

Introducing ESI

There's a new species of evidence recognized in the amendments. It's called ESI, for Electronically Stored Information, and it encompasses any potentially relevant data that's stored on computers, disks, tape, gadgets and the Internet.

The amendments don't so much create new rights as compel lawyers and litigants to deal with the central role computers and the Internet play in business and our lives. ESI comprises a startling 95 percent of all information created nowadays, yet legions of lawyers have been remiss in marshalling this rich evidentiary resource, preferring instead to focus on familiar paper documents. The Rules amendments make clear that discovery of ESI stands on equal footing with discovery of paper documents and require that any request for production of documents be understood to include a request for ESI. Although the Committee that drafted the ESI amendments could have stretched the definition of "document" to include ESI, they wisely recognized that more was needed. After all, so much of the electronic information that impacts our lives—like databases, web content, voice messaging, even spreadsheets—bears little resemblance to conventional documents. Instead, ESI is defined broadly to encompass the forms computer-based information takes today and adapt to whatever tomorrow brings.

The upshot of the new Rules is that:

• ESI is discoverable
• Clients must preserve and produce ESI
• Lawyers must understand how to request, protect, review and produce ESI
• The courts have the tools to rectify abusive or obstructive electronic discovery

Preservation of ESI

Though the Rules don't articulate what litigants must do to meet their common law and statutory duties to preserve potentially relevant ESI, they make clear that the duty to preserve evidence is very much alive and well in the realm of electronic discovery. In fact, not only must accessible ESI be preserved, ESI which a party deems inaccessible must also be preserved so as not to eviscerate a requesting party's right to obtain production.

Make no mistake: preservation of ESI is challenging. Information stored on computers always consists of two or more "chunks" of data, typically a "file" plus information called system "metadata" describing the characteristics of the file and its place within its host environment, e.g., its location, size, name, origins and history. Metadata take many forms and are often important evidence in their own right. However, as some metadata are designed to change in order to track, e.g., access to the file, changes to the file and its relocation, metadata may be quite fluid; accordingly, its preservation demands special handling.

In recognition of the challenges posed by preservation of malleable data in a fluid and somewhat autonomous environment, the amended Rules provide a measure of reassurance to those who act diligently to preserve data but fail. Absent exceptional circumstances, amended Rule 37(f) prohibits a court from imposing sanctions under the Rules of Civil Procedure for the failure of a party to provide ESI lost as a result of the "routine, good-faith operation of an electronic information system." Nothing in the new rule limits the scope of preservation, and the commentary to the amendments suggests that a finding of good faith will hinge on the extent to which the party's efforts to preserve the lost data were reasonable and timely.

Third Party Preservation and Production

A lot of people store your client's electronic information. That data should be preserved in a litigation hold because it's fair game in discovery. So plan on telling lawyers, accountants, Internet service providers, spouses and off site data storage providers to hang on to what they have. If you're the requesting party, don't forget to consider third parties when you send out preservation letters, and note that Rule 45 governing subpoenas has been amended to support discovery of ESI from third parties, as well as to protect third parties from unduly burdensome requests for ESI.

Stepping Up to the Plate

Amended Rule 26(a) requires that a party must, without awaiting a discovery request, promptly identify or produce ESI (along with documents and tangible things) in the party's possession, custody or control that the party may use to support its claims or defenses. That's right, you've got to step forward without a discovery request.

The duty to affirmatively disclose material supporting claims and defenses has been part of the Rules for some time; however, paper is inherently accessible without specialized software or equipment. Further, paper has a self-limiting character in terms of volume. A lot of paper is expensive, heavy and takes up space, so we tended to get rid of it. By contrast, billions of bytes seem not to weigh anything and feel like they don't take up physical space or cost much to store. Consequently, we acquire and amass electronic information in volumes that, were it on paper, would have driven us from our homes and offices long ago. The obligation to promptly identify and produce relevant ESI presupposes the ability to first promptly find, preserve, collect, manage, review and duplicate that ESI—a capability that few litigants and fewer lawyers currently possess, but which we all must acquire.

Meet and Confer

Under the new Rules, parties must not only be prepared to swiftly produce the ESI they expect to use, but they must also, very early on, be fluent and forthcoming about their preservation of ESI and any issues relating to its disclosure or discovery. Amended Rule 26(f) requires that parties meet and confer shortly after the response date to address any issues relating to ESI, including its preservation and the form or forms in which it should be produced. The courts expect the conferees to arrive with answers and display a genuine, good faith effort to resolve e-discovery questions.

In some jurisdictions, the Rule 26(f) conference has been something of a "drive by" event. This will surely change after December 1, and counsel should be prepared to know who to call to get answers about information systems, back up and retention practices, customary formats and applications, data location, volume and composition and a host of other new and unfamiliar topics. Counsel attending these conferences will either need to know their client's systems well or bring along someone who does. Early and earnest cooperation with opposing counsel and transparency of process will be essential. Adversarial posturing is best checked at the door.

Inaccessibility

Under the amended rules, your client need not produce ESI that's "not reasonably accessible," but if an opponent objects, your client must prove inaccessibility in court. No one yet knows what is and is not "reasonably accessible" where ESI is concerned, and the definitions extant vary according to whose ox is gored. When a great volume of ESI is implicated, producing parties will claim inaccessibility despite having easy access to individual files. They'll contend that information is inaccessible if it's stored on tape or consists of data that's rarely accessed or is simply disorganized and commingled with privileged material such that it's costly to review. Requesting parties will counter that anything's accessible if you devote sufficient money and effort to the task. Judges—principally federal magistrates—will bridge the chasm as best they can using wisdom gleaned from colleagues and judicial education, by splitting the baby and by applying their (often very astute) "radar" to distinguish bad faith from good.

Plan on the court asking why ESI is difficult to access and pressing counsel to articulate exactly what they're seeking and why they need it. Some judges will say, "Just give it to them" or "Do you want it badly enough to pay for it?" Mostly, we can expect to hear, "Get your technical people down here, go into my jury room and don't leave until you've worked it out."

The Vale of Tiers

Even if you satisfy the court that your client's ESI isn't reasonably accessible, you're not done. There's a second tier to be surmounted. The new Rules allow a requesting party to seek production of inaccessible ESI through a showing of good cause. If you represent a party ordered to produce inaccessible ESI after good cause is shown, your recourse is to ask the court to tailor the production order to minimize your client's burden, perhaps in ways (such as by cost shifting) that will cause the requesting party to narrow or abandon the request. The court may also impose conditions to minimize undue burden by, e.g., granting access to less than the entire pool of potentially responsive ESI (instead, sampling parts of the data to assess its value to the case) or by requiring the use of data filtering and keyword searches designed to narrow the scope of review and production.

Cost Shifting

Cost shifting may have some salutary chilling effect on abusive or sloppy discovery, but it also risks closing the courthouse to meritorious claims against, e.g., "packrat" organizations with poorly managed information. Too, the twin goals of expediency and cost-efficiency enunciated by the Federal Rules of Civil Procedure are unlikely to be furthered when costs come from the other side's purse. Where's the incentive to be fast or frugal when the opposition's footing the bill? Here again, magistrates are the ones in the trenches and, in balancing the equities, must be sensitive to the impact of costs and cost shifting, promoting proportionality without erecting barriers to justice.

Forms of Production

Unless the other side expressly agrees or the court orders it, you can't produce paper printouts of documents when the originals you hold are electronically searchable.

Per amended Rule 34(b), the other side gets to select the form or forms in which your side produces ESI. If you don't produce as designated, you must produce as maintained in the course of business or in a reasonably usable form. Whether you preserved electronic searchability will be a decisive factor in assessing usability.

You can't produce ESI in a form different from that selected by the requesting party unless you've first told the other side the form you intend to use and afforded them an opportunity to object and seek assistance of the court. An unceremonious "here it is" may get your client into trouble. It's unclear how long prior to the deadline for production you must make the alternate format disclosure. Can a producing party designate the production format on the thirtieth day and then wait for objection, or must the producing party designate beforehand and then produce in your preferred format on the thirtieth day? The commentary to the Rules note that additional time may be needed, but offers no guidance.

Clawback Protection

The inadvertent production of privileged information is every lawyer's nightmare. It occurred with regularity in the discovery of paper evidence even when we examined every page before production. But as the volume of information grows exponentially with the ascendancy of ESI, we are fast losing the ability to review individual items, and it's increasingly common for privileged and non-privileged content to insidiously mix, as occurs when, e.g., a privileged exchange is an embedded thread in an apparently benign e-mail. Recognizing the growing potential for inadvertent production of privileged material, amended Rule 26(b)(5)(B) permits a party who has produced privileged or work product data to notify any party recipient of the data and the basis for the claim that it's privileged. After notice, any party receiving the allegedly privileged material must return, sequester or destroy the specified information, must retrieve any copies shared with non-parties (e.g., experts) and may not use or destroy the allegedly privileged ESI until the claim of privilege is resolved.

The amendment affords any party challenging the assertion of privilege the right to promptly present the disputed ESI to the court under seal. The producing party is obliged to preserve the disputed ESI until the claim is resolved.

The amended Rule doesn't affect the substantive law governing privilege in the jurisdiction in which the case is pending. The law of the forum or other applicable law still governs issues of privilege and waiver. The amended Rule merely describes a framework for preservation of rights and presentation of claims pending resolution under the applicable law. The ESI claimed to be privileged must be logged as other privileged materials but it's unclear how much detail will be required for ESI. Must privileged ESI be logged item-by-item or may be described more broadly so long as the description is sufficiently clear and complete to permit the parties and the court to understand the basis for the claim and determine whether waiver has occurred?

Fear, Uncertainty and Doubt

Learning to live under the new Rules won't be easy, but fundamentally important changes rarely are. Requesting parties will curse the delay and unpredictability of the two-tiered accessibility analysis. Responding parties will bemoan the necessity and cost to collect, review and produce all the relevant electronic evidence they've happily been ignoring heretofore. Judges and magistrates will see dockets swell with e-discovery disputes. All will wish they better understood computers and that, in the rush to embrace automation, we hadn't all been so quick to abandon records management.

Electronic evidence isn't going away. It grows more important—more revealing, more varied, more detailed—each day. Despite the confusion and cost, the Rules amendments insure that electronic discovery receives the overdue focus it warrants, and as we learn more about digital evidence and become adept at seeking, identifying, preserving, searching and producing ESI, the fear, uncertainty and doubt will be as distant a memory as eight-track tapes and phonorecords.