CLICK ON EACH FILE IN THE LEFT HAND COLUMN TO SEE INDIVIDUAL PRESENTATIONS. If no column is present: click Bookmarks or Pages on the left side of the window. If no icons are present: Click V iew, select N avigational Panels, and chose either Bookmarks or Pages. If you need assistance or to register for the audio portion, please call Strafford customer service at 800-926-7926 ext. 10 Email and Discovery Risks: Beyond Qualcomm v. Broadcom Effectively Managing Electronic Evidence and Avoiding Sanctions, Penalties and Ethical Violations presents Today's panel features: Lynn M. Reilly, K & L Gates, Seattle Michael E. Lackey, Jr., Partner, Mayer Brown, Washington, D.C. Marie A. Lona, Partner, Winston & Strawn, Chicago Wednesday, June 3, 2009 The conference begins at: 1 pm Eastern 12 pm Central 11 am Mountain 10 am Pacific The audio portion of this conference will be accessible by telephone only. Please refer to the dial in instructions emailed to registrants to access the audio portion of the conference. A Live 90-Minute Audio Conference with Interactive Q&A
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CLICK ON EACH FILE IN THE LEFT HAND COLUMN TO SEE INDIVIDUAL PRESENTATIONS.
If no column is present: click Bookmarks or Pages on the left side of the window.
If no icons are present: Click View, select Navigational Panels, and chose either Bookmarks or Pages.
If you need assistance or to register for the audio portion, please call Strafford customer service at 800-926-7926 ext. 10
Email and Discovery Risks: Beyond Qualcomm v. Broadcom
Effectively Managing Electronic Evidence and Avoiding Sanctions,Penalties and Ethical Violations
presents
Today's panel features:
Lynn M. Reilly, K & L Gates, Seattle
Michael E. Lackey, Jr., Partner, Mayer Brown, Washington, D.C.
Marie A. Lona, Partner, Winston & Strawn, Chicago
Wednesday, June 3, 2009
The conference begins at:1 pm Eastern12 pm Central
11 am Mountain10 am Pacific
The audio portion of this conference will be accessible by telephone only. Please refer to the dial in instructions emailed to registrants to access the audio portion of the conference.
A Live 90-Minute Audio Conference with Interactive Q&A
Email and Discovery: Lessons Learned from Qualcomm
Lynn Reilly, K&L Gates
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Qualcomm Inc. v. Broadcom Corp.
U.S. District Court, Southern District of CaliforniaSenior District Judge Rudi M. BrewsterMagistrate Judge Barbara Lynn Major
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What Went Wrong?
Option 1: Qualcomm intentionally hid documents so effectively that outside counsel did not know or suspect that the suppressed documents existed.
Option 2: Outside lawyers failed to discoverintentionally hidden documents due to“complete ineptitude and disorganization.”
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What Went Wrong?
Option 3: Qualcomm shared the damaging documents with outside counsel and they worked together to hide them.
Option 4: Outside counsel suspected they existed, but ignored the evidence and warning signs and accepted Qualcomm’s “incredible assertions.”
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Background
Patent infringement case regarding video compression technology
H.264 standard implicated Qualcomm’s patents
Qualcomm’s participation in standards body central to defense
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How Did They Get Here?
Typical Discovery Responses
“… documents describing QUALCOMM’s participation in the JVT, if any”
“... documents that were given to or received from” a standards body
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How Did They Get Here?
30(b)(6) response “troubling”
Two witnesses; both testified falsely
Neither witness’ computer had been searched
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The Loose Thread …
2002 “email reflector list” from the “Advanced Video Coding” ad hoc group (avc_ce)
Over the coming months, Qualcomm aggressively argues, based on lack of evidence, that it did not participate.
Submits expert report on corporate records Moves for summary adjudication Files motion in limine to exclude the email list
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Begins to Unravel …
Did not search the hard drives of the 30(b)(6) witnesses
Did not search for pre-September 2003 JVT, avc_ce or H.264 records in the email of testifying witnesses
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Trial Begins
A junior associate discovers an email welcoming Viji to the avc_ce mailing list
Search for term “avc_ce” discovers 21 more emails not produced
Qualcomm decides not to produce: not responsive to discovery requests
Qualcomm trial team conducts no further investigation
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The Turning Point …
Qualcomm’s counsel, arguing that email list is inadmissible:
“Actually, there are no emails – there are no emails … there’s no evidence that any email was actually sent to this list.“
No Qualcomm attorney mentioned the 21 emails found four days earlier
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The Turning Point …
During Viji’s direct testimony, Qualcomm’s counsel asked whether she had “any knowledge of having read” email from the avc_ce mailing list
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The Turning Point …
Viji admits receiving email from the acv_ce mailing list in 2002
Qualcomm produces the 21 emails during lunch recess
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Six Months Later …
Qualcomm had searched the email archives of 21 employees and located more than 46,000 responsive documents totaling more than 300,000 pages that had not been produced.
Many of these emails were to or from the original 30(b)(6) witness.
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“The Court finds by clear and convincing evidence that Qualcomm counsel participated in an organized program of litigation misconduct and concealment throughout discovery, trial and post-trial ….”
Judge Brewster’s 8/6/07 Order
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“[T]he Sanctioned Attorneys assisted Qualcomm in committing this incredible discovery violation by intentionally hiding or recklessly ignoring relevant documents, ignoring or rejecting numerous warning signs that Qualcomm’s document search was inadequate, and blindly accepting Qualcomm’s unsupported assurances that its document search was adequate. The Sanctioned Attorneys then used the lack of evidence to repeatedly and forcefully make false statements and arguments to the court and jury.”
Magistrate Judge Major’s 1/7/08 Order
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Summary of Failings
No reasonable inquiry before making specific representations and legal arguments to the court
No search of key employees’ computers using obvious search terms
Ignored warning signs and failed to investigate further
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Summary of Failings
Decided not to produce critical emails
“Approved or ignored” pleadings containing false statements
“Stood mute” while inaccurate representations were made to the court
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Sanctions imposed by the magistrate judge:
Qualcomm sanctioned $8,568,633.24 All Broadcom’s attorneys’ fees and costs
6 Qualcomm outside counsel ordered to report themselves to California State Bar
6 Qualcomm outside counsel and 5 in-house attorneys ordered to participate in CREDO program
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Updates
Tension between Qualcomm and its outside counsel
Judgment affirmed December 1, 2008
Discovery dispute continued until case settled
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Lessons Learned
Don’t ignore red flags – follow up and fully investigate Junior lawyers must report problems to supervising
attorneys Make factual representations to the court only after
conducting a reasonable inquiry
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Records Management
Develop comprehensive records management policies
Consistency means lower costs
Ensures critical business information is disaster-proof
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Litigation Readiness
Develop a litigation response plan
Lower costs to collect and review
Quick dissemination of legal holds
Strategic advantage during early meet and confer
Easier compliance with discovery obligations
Mayer Brown is a global legal services organization comprising legal practices that are separate entities ("Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP, a limited liability partnership established in the United States; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales; and JSM, a Hong Kong partnership, and its associated entities in Asia. The Mayer Brown Practices are known as Mayer Brown JSM in Asia.
of Inaccessible Data Sources• Rule 26(f) Early Meeting of Counsel• Rule 33 Interrogatories to Parties• Rule 34 Demand for Documents• Rule 37 Sanctions• Rule 45 Subpoenas
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Trigger Analysis: Plaintiffs v. Defendants
• “Reasonable anticipation of litigation”• Defendant demand letter workplace dispute (employment cases) attorney work product
• Plaintiff start thinking about a suit begin factual/legal inquiry draft complaint
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FRCP 37 & The “Litigation Hold”
• “Reasonable and good faith efforts to retain information that may be relevant to pending or threatened litigation” Sedona Principle 5
•Rule 37: “Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good faith operation of an information system.”
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What Is “Routine Loss”?
• Standing Committee Report: Recycling of backup tapes
• Automatically or manually?
Automatic overwriting of deleted information
Automatic deletion of e-mail that has not beenaccessed within a defined period
Automatic changes to metadata as information is used
Dynamic database programs that are automatically updated and discard information
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What Is “Good Faith”?
Cannot take advantage of such routine operations to destroy data that should be preserved
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Litigation Hold Considerations
• What information is relevant?• Who is likely to have relevant information?
Get organizational charts; create lists; interviews
• Where are the data located? Data mapping; identify servers/laptops/etc.; e-mail, file/print
servers, databases, distributed data; voicemail; home computers,PDAs, backup tapes The “Morgan Stanley” problem
• When is the relevant time frame? Historical only? Current data? Ongoing?
• How must the data be handled? HIPPA
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Best Practices When Implementing A Hold
• Prompt notification Key people, work outward Who sends the notice Broad then narrow
• Involve business unit, IT, document management personnel Awareness of automatic deletion issues
• Email janitor system; databases, archives (backup systems and paper)
Suspend systems?
• Keep good records of process, decisions• Identify 30(b)6 witness(es)
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Best Practices When Implementing A Hold
• Supplemental notice with more detailed information and guidance Refine what must be retained
How to retain (be specific)
How will data be collected
Who to contact with questions
• Personal follow-up, interviews
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Ongoing Preservation Obligation
• Difficult problem: Advanced Micro Devices, Inc. v. Intel Corp., (D. Del.)
• Volume
• Risk of mistake
• Manual v. Automated Approach
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ESI Collection Issues
• Flexibility
• Authenticity – data not changed
• Admissibility – chain of custody issues, hearsay
• Lorraine v. Markel American Ins. Co., 241 FRD 534 (D. Md. 2007)
• United States v. Safavian, 435 F. Supp. 2d 36 (D.D.C. 2006)
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Privilege Issues
• Rule 26(f) Meet and confer obligation: parties must meet “as soon as practicable”
• Parties must discuss “preservation issues”
•As part of discovery plan, parties address: Handling privilege claims
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Privilege Issues
• Rule 26(b)(5)(B): Privilege Absent agreement, a party notified of a claim that
information produced was privileged or trial preparation material must promptly return, sequester, or destroy it and not use it until claim resolved
Rules 26(f) and 16(b) Committee Notes encourage use of “Quick Peek” and /or “Clawback” agreements
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Rule 26(f): “Quick Peek” Agreement
•Responding party makes all potentially relevant information available without first performing a privilege review
•Requesting party reviews the information and designates what is responsive
•Responding party then reviews only the designated information for privilege issues and asserts privilege for appropriate documents even though other side has already seen them
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Rule 26(f): “Claw Back” Agreement
•Non-waiver agreement
•Parties agree that, if privileged information is inadvertently produced, the receiving party will return it
•They agree that the inadvertent production did not waive the privilege
•Receiving party may still challenge the claim of privilege on other grounds
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Litigation Risks in Hold and Collection Process
•Hold: miss documents versus over preserve possible sanctions
subsequent litigation
impact organizations operations
•Collection: miss documents versus over collect and review possible sanctions
Adverse Inference: In re Napster, Inc. Copyright Litig., 2006 WL 3050864 (N.D. Cal. Oct. 25, 2006)
Default, partial default judgment: Morgan Stanley
Referral to state bar: Qualcomm
Criminal: Andersen
•Self-imposed remediation AMD v. Intel
Mayer Brown is a global legal services organization comprising legal practices that are separate entities ("Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP, a limited liability partnership established in the United States; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales; and JSM, a Hong Kong partnership, and its associated entities in Asia. The Mayer Brown Practices are known as Mayer Brown JSM in Asia.
Information Management:Types of Electronic Documents and Data
• E-mail (including attachments)• Word processing documents• Spreadsheets• Presentation documents• Graphics• Animations• Images• Audio, video and A-V recordings• Voicemail• Text messages and other communication
Information Management:Still More Sources of Electronic Documents and Data
• Databases• Networks• Computer systems, including legacy systems
(hardware and software)• Servers (network, departmental, e-mail, fax, etc.)• Archives• Back up or disaster recovery systems• Tapes, discs, back-up zip, jaz and tape drives,
Phoenix Four, Inc. v. Strategic Resources Corp., 2006 WL 1409413 (S.D.N.Y. May 23, 2006)
• Defendant goes out of business and abandons computers
• Counsel needed to make reasonable inquiry: Abandonment of computers "constituted an act of gross negligence that is not excused by the disarray of their business affairs"
• Ten steps a company should take to comply with electronic discovery obligations Maintain and communicate a well-thought-out records retention policy
– involve legal, IT, records managers and senior management Implement and monitor information management policy Create datamap of electronic environment Set up a discovery response plan and team Maintain litigation hold policy and database Routine communication of litigation holds Make sure in-house counsel is educated about ESI Make sure outside counsel is educated about ESI Implement preservation steps quickly Proceed cautiously with collection of ESI and document steps and
Suggestions for Outside Counsel Under the Amended Rules
• Understand the client's electronic environment early
• Obtain information on ESI in advance of Rule 26(f) conference
• Use the Rule 26(f) conference to disclose ESI environment, accessibility issues and preservation steps – First line of defense for later motion practice and sanctions
• Document steps and decisions made regarding production and preservation
• Develop lines of communication with in-house counsel and IT personnel as well as third-party vendors
• Marie Lona is a litigation partner in Winston & Strawn's Chicagooffice and is the founding chair of the firm's e-Discovery and Electronic Information practice group. She is highly experienced in e-discovery matters in large, complex litigation from assessment and retention through production and admissibility. She assistsclients in simplifying the often complex world of electronic information in anticipation of and preparation for major litigation-oriented activities. Ms. Lona routinely provides seminars to corporations concerning electronic information. She also is a member of the Sedona Conference working group, Electronic Document Retention and Productions.