Commercial Litigation and Arbitration

Electronic Spoliation

Gregory P. Joseph*

Can you properly instruct your experts to destroy drafts of their reports as they are working toward the final? Does it matter whether those drafts bear or reflect the comments of others? What if the comments reflected on the drafts are yours? Must communications with experts — including your emails —be preserved? Are your notes of conversations with your own experts discoverable?

We live in an era of spoliation. Parties long not so much for documentary evidence as for evidence that documents have been destroyed. This article explores the application of spoliation principles to expert-related materials.

The threshold question is whether the materials are discoverable. If so, there is necessarily a duty to preserve them since by definition there is a pending or reasonably foreseeable lawsuit. West v. Goodyear Tire & Rubber Co., 167 F.3d 776, 779 (2d Cir. 1999).

Impact of Report Requirement. The discoverability of expert-related materials turns largely on an analysis of Fed. R. Civ. P. 26(a)(2)(B), the expert report requirement added in 1993. This Rule mandates disclosure not only of "a complete statement of all opinions" but also of "the data or other information considered by the witness in forming the opinions." The critical word is "considered." The 1991 draft of this rule originally proposed "relied," but that was deleted as too restrictive.

"‘Considered,’ which simply means ‘to take into account,’ clearly invokes a broader spectrum of thought than the phrase ‘relied upon,’ which requires dependence on the information." Karn v. Ingersoll Rand, 168 F.R.D. 633, 639 (N.D. Ind. 1996) ("considered" is satisfied where experts have "reviewed" documents "related to the subject matter of the litigation... in connection with forming their opinions"). The 1993 Advisory Committee Note to Rule 26(a)(2)(B) observes that: "Given the obligation of disclosure, litigants should no longer be able to argue the materials furnished to their experts to be used in forming their opinions are protected from disclosure when such persons are testifying or being deposed."

Therefore, matters considered by experts are generally disclosable in their reports and, therefore, discoverable. This includes documents provided by counsel to the expert and the expert’s draft reports and notes. Corrigan v. Methodist Hosp., 158 F.R.D. 54, 58 (E.D. Pa. 1994); Ladd Furniture v. Ernst & Young, 1998 U.S. Dist. LEXIS 17345 at *34 (M.D.N.C. Aug. 27, 1998); Hewlett-Packard v. Bausch & Lomb, 116 F.R.D. 533, 537 (N.D. Cal. 1997).

Consequently, ordering experts to destroy drafts and notes is generally sanctionable. W.R. Grace & Co. v. Zotos Int’l, Inc., 2000 WL 1843258 at *10-*11 (W.D.N.Y. Nov. 2, 2000). There are, however, a series of open issues — and a fundamental question whether this result is always the right one.

Comments of Consulting Experts. What if the drafts bear the comments of nontestifying, consulting experts, whose work product is generally non-discoverable, subject to the "exceptional circumstances" test of Rule 26(b)(4)? An important 2001 opinion, Trigon Ins. Co. v. United States, 204 F.R.D. 277 (E.D. Va. 2001), holds this material discoverable. The defendant in Trigon retained a respected litigation consulting firm to supply experts (third-party academics) and to assist those experts in preparing their reports. The consulting firm and its principals remained non-testifying experts. The plaintiff sought all drafts worked up between the testifying experts and the consulting firm — and all communications (including email traffic) between them — much of which had not been preserved.

The Trigon Court held that since the drafts and substantive emails had been "considered" by the testifying experts in forming their opinions, the materials were discoverable. Trigon further ruled that the destruction of these materials was sanctionable because it was intentional, and that spoliation remedies attached regardless of whether the defendant acted in bad faith. The Court did not preclude the experts’ testimony because that would have interposed a delay prejudicial to the plaintiff (the court would have permitted the defendant to engage new experts). Instead, the Trigon Court ordered the defendant to engage an outside technology consultant to retrieve as much of this data as possible — with the plaintiff’s full participation in the process — and held it "appropriate to draw adverse inferences respecting the substantive testimony and credibility of the experts." Id. at 291.

In a late 2002 opinion, the Trigon Court also awarded the plaintiff more then $179,000 in fees and costs attributable to the spoliation. Trigon Ins. Co. v. United States, 2002 U.S. Dist. LEXIS 24782 at *7 (Dec. 17, 2002).

Interestingly, at the same time that it found sanctionable the destruction of drafts bearing the comments of other experts, the Trigon opinion stressed that it was not deciding "whether a testifying expert is required to retain, and a party is required to disclose, the drafts prepared solely by [the testifying] expert while formulating the proper language in which to articulate that experts’ own, ultimate opinion arrived at by the expert’s own work or those working at the expert’s personal direction" and that "[t]here are cogent reasons which militate against such arequirement...." 204 F.R.D. at 283 n.8.

These cogent reasons were not specified, and, as noted above, other cases expressly allow discovery of draft reports and notes. At least one federal judge has issued a Standing Order requiring their production. See Supplemental Order to Order Setting Case Management 3 Conference in Civil Cases Before Judge William Alsup at ¶15 (N.D. Cal. November 25, 200 ).

However, there are cogent reasons why the Advisory Committee should reconsider whether this is the optimal result. Every carefully-drafted document has false starts. The quality of the final is not judged by the quantity or quality of the drafts. That is true of judicial opinions and briefs as well as expert reports. For the expert to formulate a reasoned opinion, he or she should be afforded the latitude to filter the facts through the prism of his or her expertise — using whatever process seems most appropriate — without intrusion and without the necessity of attempting to avoid committing matters to writing. If the concern is ghost-writing or undue influence by others, a party should be required to make a prima facie showing that validates that concern before piercing the report and opening underlying matters to discovery.

Regrettably, the proposed distinction in Trigon between the work-product generated by "those working at the expert’s personal direction" and that of the outside consulting litigation firm is also difficult to sustain under Rule 26(a)(2)(B). Moreover, if it were sustained, the expert industry would no doubt be restructured so that experts relied only on "employees." But if the relevant concern is ghost-writing, there is no obvious reason why the courts should treat ghostwriting by employees differently from that of third-parties. The element of personal direction is really the key, and the question is always the same — whether the expert is giving the direction or receiving it. Is there a genuine issue as to just whose opinion the expert is espousing?

Counsel’s Comments/Communications with Expert. The discoverability of communications between counsel and experts has split the courts since 1993. See generally 6 MOORE’S FEDERAL PRACTICE § 26.80[1][a] (3d ed. 2002). The technical issue is whether the protection for opinion work product set forth in Rule 26(b)(3) is trumped by the disclosure requirement of Rule 26(a)(2)(B). Many courts, like Karn, hold that it is and that all 4communications between counsel and the expert are discoverable. Others, following Haworth, Inc. v. Herman Miller, Inc., 162 F.R.D. 289 (W.D. Mich. 1995), come to the opposite conclusion. I have advocated the latter position (Emerging Expert Issues Under the 1993 Disclosure Amendments to the Federal Rules of Civil Procedure, 164 F.R.D. 97 (1996)), but the trend of decisions appears now to favor the Karn approach. While that approach airly addresses the perceived need to explore the basis of the expert’s opinion, it is overly broad — capturing every exchange between counsel and the expert, regardless of the substance and regardless of whetherthere is any doubt that the opinion is in all respects that of the witness. This result operates to favor those litigants who can afford separate consulting experts off whom, for example, counsel may bounce ideas as to cross of opposing experts and trial strategy.

In those jurisdictions following the Karn approach, drafts of expert reports bearing counsel’s comments are discoverable. Weil v. Long Island Savings Bank, 206 F.R.D. 38 (E.D.N.Y. 2001). There is the further question of the discoverability of counsel’s notes reflecting oral communications with the expert. This is one step removed from the actual communications — assuming that the expert has never seen the notes — and necessarily implicates serious opinion work product concerns. The notes should be deemed immune from discovery, absent a prima facie showing of that (1) they reflect either misconduct or ghostwriting by counsel or form an important basis of the expert’s opinion, and (2) cannot be recreated in any other way (e.g., from testimony from the expert). Some courts have properly shown some reticence in ordering production of such notes. See, e.g., B.C.F. Oil Refining v. Consol. Edison Co. of N.Y., 171 F.R.D. 57, 66-67 (S.D.N.Y. 1997). W.R. Grace, 2000 WL 1843258 at *5; Amster v. Tiver Capital nt’l Group, 2002 U.S. Dist. LEXIS 13669 (S.D.N.Y. July 26, 2002).

Practice Pointers. This discussion suggest the following practice pointers:

1. Each expert should, on retention, be made aware that everything he or she writes or receives, including every email, is potentially discoverable. Nothing should be discarded or purged (better yet, nothing written). This should be added to the expert retention letter, to show counsel’s diligence in this regard. Special efforts must be undertaken by those experts working for organizations whose electronic documents are regularly purged to insure that potentially discoverable material is not destroyed.

2. Lawyers should curtail their written communications with experts, and those of others, like consulting experts (whose engagement letter should similarly afford notice of the preservation obligation). There is no duty to create exhibits for your adversary.

3. Lawyers should be conscious of the risk that notes of conversations with experts may be discoverable. For years you’ve urged your clients not to take notes. Now, it’s your turn.

4. Even if draft expert reports are discoverable, there is no obligation to create them. There is no prohibition against having an expert work on a single version of a single electronic document. This will not prevent the adversary from requesting the hard drive of the expert’s computer to see what can be electronically discerned. That, however, is expensive and less likely than a routine request for hard copies.

5. Be slow to request any of this discovery from your adversary. You, too, have a expert. It is effectively possible o insure that no potentially responsive documents are lost, however hard you try. Mutual assured destruction worked for decades. It still has legs.

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