|Electronic Black Hole
What to do with old e-mails? Fail to
properly maintain or account for electronic documents and data
and you could face big legal hassles.
By Scott Sinder
I sent my first e-mail on the Monday after Thanksgiving, 1991.
The law firm where I worked had moved, and one of the many perks
of the new space was computer interconnectivity and e-mail. The
e-mails could be sent only internally. Al Gore’s Internet
had not yet made it to our office. Many of you probably wish it
had never made it to yours.
Some of you view e-mail as a litigation plague to be avoided
at all costs. The rest of us have come to rely on it as an
essential business tool. There are three potential e-mail issues
that could become litigation problems if your firm does not
consciously address them: how long to keep your e-mail; where to
keep it; and knowing what you’re really sending.
How long? The federal courts
have now spoken. In December, the courts adopted amendments to
the Federal Rules of Civil
Procedure, which govern the discovery of electronic
information. Like so much law, this directive is framed in the
negative, directing that a federal court “may not impose
sanctions…on a party for failing to provide electronically
stored information lost as a result of routine, good-faith
operation of an electronic information system.” This
crystal clear rule applies to all electronically created data,
including the four with which you are probably most familiar:
e-mails, databases, word processing documents and
The retention schedule for e-mail turns on what is included in
your e-mails, whether e-mails are printed and retained in paper
files, the nature of your specific business practices, etc.
E-mail is a tool, and every firm employs it in different ways.
Some firms memorialize all of their contractual agreements
through e-mail correspondence. Others bar that practice.
You should have a document retention schedule that includes a
protocol regarding how long e-mails should be retained on your
system. The new federal rules specifically endorse this practice
provided that a few conditions are satisfied. First, the protocol
must be memorialized in a written document that explains the
business justifications for the schedule. Second, that protocol
must be followed. Third, your firm must have someone available at
all times who can explain your protocol, how it is effectuated,
and how your computer systems are configured and maintained. In a
well-publicized case, a Florida court entered a default judgment
against Morgan Stanley due to the firm’s failure to locate
and produce electronically stored information, which led, in
part, to a $1.4 billion damages award for the suing party.
Although that jury award was later overturned, the case poses a
lesson worth heeding.
Where to keep it? Failure to
segment and organize your firm’s electronically stored
information could be an expensive non-decision as well. Simply
creating a division between where your firm stores
benefits-related information and property-casualty information
might cut the costs associated with producing documents by half
in a lawsuit that involves only one of those categories. The more
segmented and more organized, the faster (read: fewer attorney
billable hours) responsive documents can be located and the fewer
you will ultimately need to release.
What are you actually e-mailing?
This is really an e-mail attachment issue. Did you know that when
you provide electronic word processing documents or spreadsheets,
a savvy recipient can often uncover what was changed and by whom
from previous versions? This information, called metadata, can
tip your negotiation strategy or just be plain embarrassing. It
also can be used against you in many state courts. Consider using
available technology to cleanse the metadata or convert your
documents to PDF format, which do not suffer this malady.
If you find yourself embroiled in litigation in federal court,
the first thing the federal rules require your firm to do is put
a litigation stop on your document retention/destruction
protocols. Philip Morris was fined almost $3 million for its
failure to discontinue its policy of destroying all e-mails older
than 60 days after it had been sued by the government several
years ago. Several of its witnesses, whose documents were
included in the errant destruction, were barred from testifying
in defense of Philip Morris.
Your lawyers need to inform the court almost immediately of
the location of relevant, electronically stored information, how
much there may be and how difficult it will be to produce.
Employing a sound retention protocol and good organizational
methodology obviously should make compliance with these mandates
easier and the actual production much more efficient and
economical. Even so, one reality of the digital age is that
electronic document production and review demands can be
Sinder is CIAB general counsel.