Not all written communications must be preserved in perpetuity. But, when a party reasonably anticipates that a particular matter may result in a lawsuit, that party and its representatives are prohibited from destroying written materials and electronic communication (emails, etc.) which may be relevant or discoverable in that lawsuit.
In the wake of Enron and the widespread destruction of written documents and materials in numerous well-publicized disputes resulting from the financial crises of 2008, courts have increasingly imposed severe sanctions (monetary or otherwise) on a parties found be in violation of the rule prohibiting the destruction of evidence.
However, under the newly amended procedural rules, if a party is found to have destroyed electronic information and materials or if the party is found to have failed to take reasonable steps to preserve the evidence (in consideration of the circumstances of a particular matter, including the expense involved, location, storage, etc.), then a court will not sanction the offending party unless it determines that:
1. the lost information cannot be replaced or developed through some other method or source; and
2. the opposing party has been prejudiced as a result of the lost information or materials. Even then, under the new rules, a court is to “order measures no greater than necessary to cure the prejudice…”
If the court determines a party acted with the intent to deprive another party from obtaining electronic information, then the court may impose a greater sanction.
Similarly, the newly amended court rules provide that, when producing materials to an opposing party in a lawsuit, the extent of the obligation is limited to what is proportional to the needs of the case. In this manner, if a lawsuit involves a small matter, or a relatively minor sum of money, it is unlikely that the newly amended court rules would require a party to expend extensive and costly efforts to produce a large volume of data or communications. Requiring a party to do so under those circumstances would be contrary to the intent and spirit of the rules of the court.
The procedural rules of our court system are devised by committees comprised of legal scholars and experts, and are published after extensive and careful deliberation, study and opportunity for comment by members of the legal community. The newly amended court rules allow for consideration of proportionality to avoid the wasting of resources and expenses.
Now, parties may obtain non-privileged information and materials in a lawsuit that are “relevant to any party’s claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.”
The newly amended federal rules of court have evolved and kept pace with the changes and economic realities of a modern economy. Additional changes in the substantive and/or procedure rule of law will always be needed from time to time under our unique system of government, whether those changes are pursued through the legislative process, or whether they come from the judiciary in accordance with the Constitution
This latest change in the procedural rules of court, though seemingly small, is a positive and important development, and one which should be acknowledged and remembered. The principle of stare decisis (adherence to precedents), combined with a system of court rules and procedures developed to administer the fair, equitable and efficient methodology for resolving disputes in litigation, are the primary reasons why the American Court System, with all of its faults and limitations, remains the Gold Standard among all nations.
» Scott Ellzey is a litigation attorney who focuses on commercial litigation and general insurance defense matters involving both third-party liability claims and first-party coverage issues. He serves as a partner in Phelps Dunbar LLP’s Gulfport office.
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