Coming Clean on E-mail Discovery
Published By American Bar Association Journal December 1999

This article first appeared in the December 1999 issue of the American Bar Association Journal..


Coming Clean on E-mail Discovery
Soap giant Procter & Gamble, Amway battle shows need for clear rules

By Timothy Q. Delaney

The widespread use of e-mail in the workplace is causing lawyers, litigants and courts to reconsider the parameters of the rules of discovery.

In a typical company today, the use of e-mail is not only widespread but practically nonstop. Employees at all levels of a company, from administrative assistants to the ceo, use e-mail.

The sheer bulk of all that electronic correspondence places a burden on any litigant facing a discovery request that includes e-mail documents. Dealing with that burden, and the costs that go with it, may put a greater premium on cooperation between parties in litigation to define the scope of e-mail discovery, at least until the courts develop clearer rules on how e-mail discovery should be handled.

A case in point involves litigation between Procter & Gamble-- the world's largest manufacturer and distributor of personal and home care products--and Amway Corp., one of its competitors.

In 1995, P&G sued an independent distributor of Amway products in U.S. District Court in Salt Lake City. Even though Amway was not named as a party until later in the case, P&G immediately served it with a subpoena seeking documents, including e-mail. (Amway has been represented in this matter by the author's firm.)

A Massive Undertaking

Amway determined that the burden of retaining and searching every daily back-up of its e-mail, which is used extensively by more than 14,000 company employees worldwide, would be overwhelming. Amway sought to negotiate a reciprocal agreement with P&G on what e-mail should be subject to retention, pursuant to discovery.

The parties were unable to reach a discovery agreement, however, even after Amway became a party in the case with standing to conduct its own discovery.

Amway then asked the court for a protective order that would place reasonable limits on the amount of e-mail it should retain and the method of search. P&G vigorously opposed the order as 'a naked request for judicially sanctioned spoliation on a grand scale.' Amway, on the other hand, viewed it as a way to avoid any possible charges of destruction of evidence that also would benefit P&G when its turn came to respond to discovery requests for e-mail.

After the court granted Am- way's motion for a protective order, the company initiated its discovery of P&G's e-mail, only to find that P&G had made minimal efforts to save its e-mail and was discarding files on a daily basis.

Amway filed a motion for sanctions against P&G. Ruling on the motion, the court ordered P&G to pay Amway $10,000 for bad-faith destruction of e-mail records. Procter & Gamble Co. v. Haugen, 179 F.R.D. 622 (D. Utah 1998).

Keeping Pace With Progress

A sanction order by a court against a party in litigation for destroying e-mail documents is a significant step in the legal system's efforts to grapple with the advent of new technology in the workplace and its impact on litigation.

In an age of increasingly sophisticated electronic technology, the importance of preserving electronic data and materials relevant to a company's operations and legal obligations cannot be overstated.

Until the courts develop clear rules on e-mail discovery, the key to a manageable process may be getting the parties to agree to mutual parameters for that discovery.

Litigants might agree to limit their searches to: a back-up or snap- shot of their e-mail systems from an agreed date; the relevant documents uncovered by an electronic search with a limited number of key terms; e-mails generated during an agreed period of time; and to only the e-mail of employees likely to have relevant materials.

In attempting to reach agreement, litigants should be mindful of their obligations to produce documents while remaining sympathetic to the practical difficulties each side faces when tackling such a task.

That is not always an easy balance to reach. After all, in many ways, cooperation is a novel concept in litigation, too.

Timothy Q. Delaney practices intellectual property law at Brinks Gilson & Lione in Chicago.

Reprinted from the American Bar Association Journal, December 1999.  For additional information, write: ABA Journal, 750 N. Lake Shore Drive, Chicago IL 60611.