Mag. Judge Chapman Rejects "Confidentiality" Designation and Addresses "Undue Burden"

Posted on March 11, 2008 by Kevin McBride

In Hill v. Eddie Bauer, Magistrate Judge Rosalyn M. Chapman (Spring Street Courthouse) required production of alleged "confidential and proprietary" information without a protective order where defendant failed to provide a proper showing that the information was, in fact, confidential.

 

Attorneys sometimes take for granted that a protective order will be "automatic" and that a wide net can be cast around information that the client asserts is "confidential."  It is not unusual (in my experience) to refuse to produce documents until a protective order is in place--as happened here. 

 

But Judge Chapman would not condone this approach.  She required Eddie Bauer to prove the confidential information it sought to protect was, in fact, confidential and proprietary.  Because no proof was offered for confidentiality, and no confidentiality order was pre-negotiated in advance of the discovery due date, no protective order was granted. 

 

On a different subject, Judge Chapman provisionally accepted Eddie Bauer's argument (based on declarations and proof) that production of certain third party information should not occur because of "undue burden."   She allowed, however, a limited sampling of the third-party information (with certain confidential information redacted) to determine if full production should be required.

 

This ruling is a good reminder for counsel to take nothing for granted in asserting confidentiality; to be prepared with proof and declarations as to why certain information is confidential and/or unduly burdensome; and to negotiate a protective order before the discovery due date, if possible.

 

Case Highlights:

 

1.  In response to almost each and every request for production, defendants objected on, inter alia, the following grounds: "seeks confidential proprietary information prior to issuance of a protective order" ; "constitutes an unwarranted invasion of [third party''s] constitutional, statutory and common-law right of privacy in confidentiality.

 

2.  Defendant admits withholding documents from plaintiff based upon its claim of confidential proprietary information and has refused to turn over these documents without a protective order.

 

3.  Here, defendant has failed to provide any declarations or other evidence to support its claim that the documents requested are confidential information and that their "disclosure would be harmful to the party's interest in the property."

 

 4.  Moreover, if defendant truly believes it has "confidential proprietary information" it should have entered into a stipulated protective order with plaintiff or filed a motion for protective order before the date by which it was to respond to the requests.

 

5.  In addition, defendant also object to nearly all production requests as: "overly broad, unduly burdensome, and seeks information not reasonably calculated to lead to the discovery of admissible evidence." 

 

6.  Although defendant has made a general or boilerplate relevancy objection to plaintiff's document request, defendant has not provided any explanation at all why these requests are not relevant.

 

7.  In light of the declarations submitted by defendant which establish that much of the information plaintiff seeks is available in electronic format, it appears to the Court that counsel for the parties, and particularly plaintiff, must address electronic discovery.

 

Plaintiffs in this case were represented by Initiative Legal Group (Century City); defendants were represented by Akin Gump (Los Angeles office).

 

Discussion:

 

In addition to the discussion about confidential information, this case also highlights the risk of relying on "boilerplate" objections.  We all use boilerplate objections, often without much thought or analysis. 

 

This case reminds that even boilerplate objections need to be defensible, and should be more carefully analyzed at the time discovery is answered.

 

The question of "undue burden" is also highlighted in this case.  Defendants' declarations asserted that response to certain of the plaintiff's requests would consume 3,900 hours of work--the equivalent of two full work years.  Based on this Judge Chapman found an undue burden.  However, defendant had offered to provide sampling of this data; an offer that plaintiff refused. 

 

Judge Chapman ruled that because the information was largely in electronic format, sampling was an appropriate interim step. 

 

Not discussed in the opinion, however, was the apparent fact that the estimate of 3,900 hours of work for full production was based on manual printing and review of documents--a questionable approach to review of information contained in electronic format. 

 

It is a good idea for requesting parties to probe the underling assumptions of "undue burden" raised in response to a document request.  Make sure that declarations asserting the burden of review are based on electronic review procedures, not manual review procedures. 

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About this Blog

Posted on February 27, 2008 by Kevin McBride

This blog analyzes e-discovery decisions and trends in Los Angeles area federal and state courts.  In particular, this forum is designed to help practicing litigaiton attorneys in the Los Angeles area be aware of new e-discovery decisions and practices as they evolve.

 

Electronic discovery rules and case law now require litigation lawyers (and general counsel) to manage e-discovery at a high level of expertise.  A well-known case from the California Southern District Court, Qualcomm v. Broadcom, shows that failure to follow electronic discovery protocols can carry serious consequences, including referral to the state bar on ethics charges.

 

In a less well known but equally important case for practice in California Central District Court, Housing Rights Center v. Sterling, CACD Judge Dale S. Fischer has ruled that an attorney’s failure to implement a proper “litigation hold” and indifference to a client’s destruction of documents in an electronic backup system was sufficient misconduct to impose sanctions in the form of an adverse jury instruction and attorneys fees. Judge Fischer observed: “Defense counsel's apparent failure, in this electronic age, to verify with appropriate representatives of their client whether there was an e-mail backup system, cannot be countenanced.” 

 

These cases (and others) serve as a wake-up call for litigation counsel to become aware of, and properly deal with, the new challenges posed by electronic discovery. But many litigation attorneys today do not fully grasp the proper way to preserve documents, impose a litigation hold or even communicate with clients about information technology. This blog forum is designed to help litigation attorneys understand and deal with these challenges. 

 

Why another e-discovery blog?

This blog site focuses on California e-discovery law, with particular emphasis on decisions by California Central District federal judges and Los Angeles Superior Court state judges—and the e-discovery trends that evolve from those decisions. It is intended to be a “go-to” resource for any litigation attorney with cases pending in LA Superior Court or US Central District of California.  By having a narrow focus we are able to follow the development of e-discovery law in California in detail, and track rulings and tendencies of specific judges in the US California Central District Courts and Los Angeles area Superior Courts in particular.  Also, this blog site approaches e-discovery as an important strategic component of litigation—not just a mechanical exchange of electronic data. 

 

But do e-discovery laws apply in California Superior Courts?

A proposed set of statutory amendments and rule changes is under consideration by the California Rules and Projects Committee on Electronic Discovery: Legislation and Rules (Item W08-01/Leg08-01). The period for public comment closed January 25, 2008. It is expected that new e-discovery rules will be proposed to the California Judicial Counsel shortly, and then presented to the legislature for adoption. But even before adoption of formal electronic discovery rules, e-discovery is a rapidly growing area of litigation practice in California Superior Courts. For example, as early as 2003, Los Angeles Superior Court Judge Charles W. McCoy issued an order in Knable v. Intuit requiring preservation of computer evidence and allowing forensic analysis of a mirror image computer hard drive; and Judge George H. Wu in Galvan v. Ford ordered inspection of a party’s electronic data in a personal injury case. Many LA Superior Court cases have followed suit in subsequent years, some of which will be the subject of articles in this blog. 

 

We have reached the point where the vast majority of business deals and personal communications involve email. Nowadays, you can usually know what someone is thinking through access to his or her emails. Are these emails properly treated as party admissions at trial? 

 

Nowadays, most documents are stored in computers, not filing cabinets. Are you entitled to access those computer files in discovery? All California courts say “yes,” but endless battles are now being fought over the scope of access. 

 

Even before adoption of electronic discovery rules by the legislature, ad hoc practices are developing all around California by Superior court judges.   If you practice in Superior Court, you need to be aware of these trends.

 

How are FRCP e-discovery rules being applied in the Central District of California?

Discovery rules under FRCP were amended effective December 1, 2006 to formally implement electronic discovery in federal courts.  There are currently so many e-discovery cases in US district courts across the country that it is difficult to effectively track all of them. Therefore, this blog focuses on the cases of greatest practical value to Los Angeles-area practitioners—those decisions by CACD judges, decisions from the Ninth Circuit and decisions from other California US District Court judges and magistrate judges.

 

So far, in some cases main-stream decisions have been followed.  For example, Judge Dale Fischer followed the landmark case of Zubulake v. UBS Warburg  IV in her ruling in Housing Rights Center v. Sterling, defining the "litigation hold" obligation.  But in another case, Columbia Pictures v. Bunnell, new ground was developed by a CACD judge in e-discovery law, when Magistrate Judge Jacqueline Chooljian defined computer "random access memory" (RAM) as “electronically stored information" (ESI) under FRCP 34(a). 

 

This blog will closely follow all CACD decisions to help identify trends and practice tips for particular judges in the Central District.

 

How can I make practical use of this blog?

This blog addresses the core problems of electronic discovery, topic by topic, as defined by statutes, rules and case law in California state courts and in federal courts. Where pertinent, differences between California and federal law and practices are addressed and discussed. 

 

Where available, analysis of rulings by specific judges currently on the bench in US California Central District Court or Los Angeles Superior Court are discussed. Hopefully this will provide useful information to practitioners to better understand and deal with new and evolving electronic discovery rules, arguments and practices.

 

If you have cases involving electronic discovery in the Central District Court or Los Angeles Superior Court and would like to share your insights and observations, please post! 
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