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Keep or Weep Litigation Holds – Policies and Practices. James Swanson jts@bdplaw.com (403)260-5712. Today’s Topics. Obligations to preserve records Background Statutory and regulatory requirements Privacy law Government investigations Civil Litigation Preservation Litigation Holds.

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keep or weep litigation holds policies and practices
Keep or WeepLitigation Holds – Policies and Practices

James Swanson

jts@bdplaw.com

(403)260-5712

today s topics
Today’s Topics

Obligations to preserve records

Background

Statutory and regulatory requirements

Privacy law

Government investigations

Civil Litigation

Preservation

Litigation Holds

background the obligation
Background – the Obligation

Statutory obligations to preserve records:

Plethora of legislation and regulations

Employment Standards

Corporate record keeping

Tax records

Audits, investigations, etc.

Failure to preserve may attract criminal liability, fines, penalties, etc.

background the obligation4
Background – the Obligation

Statutory obligations to destroy records:

Privacy laws – PIPA, PIPEDA, etc.

Obligation to destroy when no longer needed for reasonable business / legal purposes

Destruction of personal information is an offense when it occurs after an individual has requested access to their information

background civil litigation
Background – Civil Litigation

Litigation Stages:

Pleadings

Discovery and Production of Records

Interlocutory Applications / Notices of Motion

Trial

Appeal

slide6
Pleadings

Statement of Claim, Originating Notice, Petition, etc.

Statement of Defence, Demand of Notice, Praecipe to Note in Default

Third Party Notices, Demand for Particulars, etc.

Interlocutory matters

Case management, Interim Orders

Trial / Appeal (if any)

Background – Civil Litigation

slide7
Discovery

Oral examinations, under oath, Court Reporters, transcripts

Discovery of Records (or Documents) - Production

Background – Civil Litigation

slide8
Production

Providing the opposite party with access to records that are potentially relevant and material (Alberta) (relevance, semblance of relevance, etc. in other jurisdictions)

For simplicity – we’ll call it “relevance”

Disclosure

Background – Civil Litigation

slide9
Production of Records

Definition of Record very broad in the legal system

May differ from what RM considers a “record”

Records and documents are legally the same thing, and would include information recorded in any fashion, data, visible or audible matter, etc.

If it’s relevant and perceivable by humans, it’s a record

Background – Civil Litigation

records
Records

Alberta Rules of Court

"record" includes the physical representation or record of any information, data or other thing that is or is capable of being represented or reproduced visually or by sound, or both.

slide11
Alberta Evidence Act

"record" means a record of information in any form and includes notes, images, audiovisual recordings, x-rays, books, documents, maps, drawings, photographs, letters, vouchers and papers and any other information that is written, photographed, recorded or stored in any manner, but does not include software or any mechanism that produces records.

Records

slide12
The Courts have ordered production of entire disks or hard drives on basis they are a document

The Courts have refused production of disks or hard drives on basis they are akin to a filing cabinet, or are something else besides a single document or record

As drives get larger, more of the latter approach

Records

slide13
Canadian General Standards Board

Electronic records as admissible evidence

CAN/CGSB 72.34.2005

Public release – January 2006

Records

slide14
Canadian General Standards Board

Part 1: Electronic records as documentary evidence

Part 2: Electronic Signatures and evidentiary requirements

Part 3: Codes representing retention and disposal requirements

Part 4: Long term preservation of digital information

Records

slide15
What are we talking about?

Evidence Act and Rules of Court very broad – if you can see it or hear it, then it's likely a record

Is there a difference between a document and a record?

Not in the Evidence Act or the Rules of Court

Records managers may differ

Records – Bottom Line

slide16
Electronically Stored Information (ESI) will be considered records in the legal system if they meet the relevant and material test

In discovery, potentially relevant and material records must be provided to the opposing party in the process of determining relevancy

Records

your grand dad s records
Your Grand Dad's Records

Paper was simpler

All content readily visible

Number of formats limited

WYSIWYG

Generally categorized and indexed for filing or not kept

Once destroyed, it was generally gone

Driving to the landfill was rare

Not dynamic – relatively fixed content

slide18
Copying generally led to degradation

Copying was expensive

Paper did not make copies of itself without your knowledge, nor did it run around and hide from you

File cabinets did not talk to each other

Distribution required moving atoms (at least until the fax)

Paper was not distributed and did not reside in the Cloud

Your Grand Dad's Records

slide19
Content not always readily visible – metadata

Display on screen one way of looking at the record

Printed copy another way of looking at the record

Not Your Grand Dad's Records

slide20
Number of formats large and can be changed

WYSIWYG – maybe

Very dynamic – often cannot be printed or rendered static and make sense

Often not categorized and indexed – resides all over the place

Not Your Grand Dad's Records

not your grand dad s records
Not Your Grand Dad's Records

Copying does not lead to degradation

Copying basically free

Records copy themselves without your knowing

Your servers, SAN's, etc. (file cabinets) may talk to each other without your knowledge

slide22
May have a recorded history that is not readily visible

Deleted? Maybe - a trip to the digital landfills (yes, there may be multiple copies) is generally easy

Distribution - moving bits, not atoms

Not Your Grand Dad's Records

not your grand dad s records23
Not Your Grand Dad's Records

May be interactive with other e-records, or have relationships that make viewing in isolation problematic

May virtually shred itself to bits and form a cloud of information that, if asked nicely, can reassemble into (virtually) a sheet of paper

slide24
Formerly discrete and separate domains:

telephone calls

documents and correspondence

photos, images, CAD

music, video

Now all members of the same family – DATA

Records

slide25
Anything that is digital

Not Your Grand Dad's Records

but your grand dad s records
But Your Grand Dad's Records

Can have:

DNA

Coffee stains

Fingerprints

metadata
METADATA

Data about data

You are being watched, tracked and recorded (Your computer loves you)

Complete (or not so complete) histories may be available

In the file, backups, including earlier versions, print spool files, temp files, operating systems, other applications, network software, etc.

May be relevant

metadata28
METADATA

Email is full of metadata

dates, times, sender, recipients, forwards, sent, received, routing information, cc, bcc, opened/read, printed, attachments (and where they came from)

Attachments may also have metadata

where is the e evidence
Where is the e-Evidence?

PCs, Laptops

Servers, SANs

Backup media and libraries

PDAs, cell phones, Blackberries

Removable media, disks, thumb drives, USB devices

GIS, GPS devices

PlayStation, X-Box, I-Pod, I-Phone, WII, WII Fit

where is the e evidence30
Where is the e-Evidence?

Televisions, toasters, fridges - anywhere you can hide a chip

The Network is the Computer - the Cloud, Social Media,

A lot of data about you is in the custody of third parties or machines

Production of records from third parties can be compelled by subpoena, Court Order, Letters Rogatory, etc. - or, you can be compelled

electronic records
Electronic Records

Contradictory nature:

Fragile, fleeting, subject to change or modification

booting up or down, or looking at a file can potentially destroy

Persistent, wide-spread, difficult to locate and impossible to delete

Undelete is possible, sometimes easy

Virtual Voodoo – forensic techniques

electronic records32
Electronic Records

Many potentially relevant records are:

Not created by humans

Not normally seen by humans

(sometimes) altered or destroyed, but not always by humans

Exact or near duplicates of other records

electronic records33
Electronic Records

Computers keep enormous amounts of data and history on user activities:

To be helpful

To backup data in case of loss

In the process of carrying out activities such as printing

To avoid using computing power that the user may want

To not have to decide what to delete

finding the evidence
Finding the Evidence

We can just manually review the records, right?

Volume of Data:

Kb = one page

Mb = small novel, 5 Mb = all of Shakespeare

Gb = a pickup truck full of books, 100 Gb = a library floor

Tb = 50,000 trees, 10 Tb = the entire print collection of the U.S. Library of Congress

terminology
Terminology

Active data:

On directly accessible media

Readily visible to the operating system and/or application software

Immediately accessible without restoration or reconstruction

slide38
Residual (ambient) data:

Not active

Including in free or slack space on hard disks

Data functionally deleted without recovery or special techniques

Includes deleted files

Terminology

records39
Records

Records Managers might not call metadata or residual data a record

Records Managers might not call your Facebook page or tweets a record

A lawyer would (subject to it being relevant and material)

sedona canada
Sedona Canada

Working Group 7 of the Sedona Conference

www.thesedonaconference.org

www.thesedonaconference.org/wgs

The Sedona Canada Principles Addressing Electronic Discovery

Draft for public comment 2007

Final version 2008

Ongoing development and commentary

sedona canada42
Sedona Canada

Beginning to be accepted by the courts

See, for example, Innovative Health Group Inc. v. Calgary Health Region, 2008 ABCA 219

The judiciary have participated in the drafting

sedona canada43
Sedona Canada

ESI is discoverable

Proportionality

Nature, scope, complexity of case

Amounts at stake

Relevance of available ESI

Importance of ESI to court’s adjudication

Costs, burden and delay involved

Reasonable and good faith steps to preserve potentially relevant ESI

e discovery

E-Discovery

Potentially relevant and material electronic evidence must be preserved and produced in litigation and failure to do so will result in sanctions

Reasonableness and good faith are key (see Sedona Canada Principle 2)

preservation

Preservation

A party is under a duty to preserve what it knows, or reasonably should know, is relevant and material in an action

As soon as litigation is reasonably anticipated, parties must consider their obligation to take reasonable and good faith steps to preserve potentially relevant ESI (Sedona Principle 3)

slide46

The meaning of Preservation

  • Broad in scope
  • Arises on anticipation of litigation, investigation or audit
  • Ensure that all potential sources of ESI are not modified or deleted
  • Even deleted versions of ESI may be recoverable and ordered producible
  • Reasonable steps having regard to the nature of the case required
what to preserve
What to Preserve
  • Preserve potentially relevant ESI; not all ESI
  • You cannot delete an electronic file simply because a paper version has been preserved – both must be preserved and produced
  • Electronic files contain important features such as metadata, HTML and attachments
  • Remove records that need to be preserved from any destruction sequence or schedule
what to preserve48
What to Preserve
  • Electronic records provide details to the facts
  • Be over-inclusive, just in case
  • Reasonableness and good faith appear to be gaining acceptance as a standard in the courts
  • Meet and confer at an early stage
litigation hold
Litigation Hold
  • The process used by organizations to inform employees of anticipated litigation and the obligation to preserve evidence
  • Record management policies must integrate clearly and seamlessly with the litigation hold process
  • Upon anticipation of litigation, records management must work with counsel to ensure an immediate litigation hold on potentially relevant records
  • Convene a retention planning meeting with in-house counsel, client IT, records management and key employees
litigation hold50
Litigation Hold
  • All potential sources of ESI must be identified
  • Just having a document retention policy is not sufficient – In fact, the policy may have to be modified to fit the requirements of the case
  • Back-up tapes or other legacy data, if relevant, must be preserved
litigation hold51
Litigation Hold
  • Provide clear instructions describing potentially relevant information and the legal duty of preservation
    • Provide concise direction
    • Put in writing
    • Identify that a duty to preserve has been triggered
    • Identify potentially relevant records
slide52

Sedona

Guideline 8 – A legal hold is most effective if:

Identifies the likely custodians

Communication of the preservation notice is written and ensures actual, comprehensive and effective notice of the requirements to preserve

Clearly defines what is to be preserved and how

Is periodically reviewed and reissued in either the original or modified form

slide53

Litigation Hold

Identify potential locations or sources

Identify relevant time period

Identify who has authority to deal with data and answer any questions

Direct to the appropriate people: potential custodians and those in charge of systems

Require compliance confirmation and follow up

Involve key employees

Regular review and update as litigation progresses

slide54

Litigation Hold

Keep records of steps taken as those may be relevant. Include:

Date and by whom hold was triggered and the triggering event

Initial scope of information, custodians, sources and systems involved

Subsequent scope changes as new custodians or data are identified or initial sources are eliminated

slide55

Litigation Hold

Include:

Notices and reminders sent, confirmations of compliance received and handling of exceptions to policy

Description of collection protocol, persons contacted and date information was collected

Notes from any interviews of employees, etc.

Master list of custodians, systems, sources of information involved

slide56

Litigation Hold

Determine:

Whether to use electronic search tools / methodologies to locate or keep volume manageable

Whether to preserve or restore residual, ambient or deleted but available data, or to use forensic methods such as hard drive images

How to provide a snapshot of active data

Whether legacy data is still accessible

Whether consultants or experts are required

preservation letter order
Preservation Letter/Order
  • Counsel should consider sending opposing counsel or the opposing party a preservation letter, especially if there is a lack of cooperation or no planned meet and confer with the opposing party
  • Depending on the situation, it may be prudent to apply for a Preservation Order or an Anton Piller Order
  • Consider third party custodians – social media sites, Cloud computing services
preservation letter order58
Preservation Letter/Order
  • The Preservation letter or Order should:
    • be as specific as possible on the electronic evidence you want preserved
    • list the types of documents to be preserved
    • set the temporal scope for production
    • not be over or under-inclusive
    • request confirmation of preservation
  • Ensure that you meet the standard and expectations you demand of the opposing party – No BOOMERANG EFFECT
spoliation

Spoliation

Destruction of evidence

Destruction of records that may be relevant to ongoing or anticipated litigation, investigation or audit

Destruction of evidence does not have to be wilful or malicious in order to attract sanctions

Sanctions for spoliation have been on a case-by-case basis

slide60

Spoliation

  • Considerations for sanctions include:
    • prejudice to the parties or judicial system
    • role of counsel
    • motivation of the party
    • nature of the destruction
    • degree of culpability
    • need to deter such behaviour in the future
spoliation61

Spoliation

Sanctions include:

fines

costs

limits on evidence

adverse inference

default judgment

Where there is record loss and potential spoliation, there is a need to show reasonable good faith steps were taken to preserve those records (see Sedona Principle 11)

sedona principle 11

Sedona Principle 11

Sanctions should be considered by the court where a party will be materially prejudiced by another party’s failure to meet any obligation to preserve, collect, review or produce electronically stored information. The party in default may avoid sanctions if it demonstrates the failure was not intentional or reckless.

big picture

Big Picture

Litigation Holds are just a part of proper records management and litigation readiness

Do you have:

A networked nightmare

Or

A ‘one-click’ Affidavit of Records?

lessons

Lessons

Reasonableness and good faith: the law does not require perfection, but efforts must be made to meet duties

Proportionality: an attempt to balance burden with importance recognizing that all cases are not created equally

Proactive planning: plan ahead to weather the e-discovery storm as most sanctions are awarded against those who respond to litigation in crisis mode

Education and training: the importance of these issues must be clearly communicated to those who must comply

slide65

Ask

Do I know what electronic records my company creates?

Of this data created, how much is retained? how? where?

Are our files organized and tracked? Can we find files quickly?

Do we have to search our entire network in order to certify that we have taken reasonable steps to find relevant records?

slide66

Ask

How quickly can we produce both physical and electronic files for discovery?

Do we retain records for the appropriate period of time?

Can we prevent destruction of relevant records upon contemplation or knowledge of litigation?

Are we deleting unneeded records in order to reduce the "universe" that must be searched when e-discovery obligations arise?

5 categories of records
5 Categories of Records

Those that must be retained (pending or actual litigation, legal, statutory or regulatory requirements)

Those that it’s advisable to retain (evidence that may be useful or defensive if litigation commenced, kept at least until last limitation period expires)

slide68
Those that are unnecessary or no longer needed

Those you really should get rid of (embarrassing, or could be used against you, but no pending or foreseeable litigation – careful on this point)

Those that are legally required to be destroyed at a particular point in time (e.g. personal information)

5 Categories of Records

conclusion

Conclusion

Come up with a plan – be proactive

Don't let litigation be determined by procedure rather than the merits of the case

It’s all about policies and procedures – good RM practices

thank you
Thank you!

James Swanson

jts@bdplaw.com

403-260-5712