Litigation

A Promise Made is a Promise Kept: Court Holds Party to Its Promise and Orders Re-Production in Native Format but Orders Requesting Party to Bear the Cost

By reston, Gates and Ellis

In re Classicstar Mare Lease Litig., 2009 WL 260954 (E.D. Ky. Feb. 2, 2009)

In this case, despite prior production in accordance with the Federal Rules, the court enforced a promise to produce in native format but ordered the requesting party to bear the costs.

This matter came before the court on the motion of GeoStar Corporation for relief from the court’s order requiring it to produce financial information in its native format.  Plaintiffs originally requested financial information from GeoStar “as they are kept in the usual course of business” or organized and labeled in a manner proscribed.  GeoStar objected, but the court ultimately entered orders requiring production.  The orders did not specify the format of production.

Pursuant to those orders, GeoStar produced the requested financial information.  The information was initially produced in .pdf and Excel format but was followed by a production in .tif format with load files allowing the text of each document to be searched.

Unsatisfied, plaintiffs sought, and eventually received, an order from the court directing GeoStar to produce the documents in native format.  That order also directed plaintiffs to depose a GeoStar representative with the goal of establishing the impact of such a production on GeoStar operations and invited GeoStar to make a motion for a protective order if necessary.

At deposition, GeoStar’s Chief Financial Officer testified that the re-production would be difficult and burdensome because of the necessity of performing extensive redactions and the need to review and possibly repair older and corrupted data.

Seeking relief from the production of native documents, GeoStar argued that its prior production “met and satisfied the requirements of Fed. R. Civ. P. 34(b)(2)(E).”  Rule 34 provides that where the requesting party fails to specify the format of production (as was the case here), “a party must produce it in a form or forms in which it is ordinarily maintained or in a reasonably useable form or forms.”  The Advisory Committee Notes clarify:

The rule does not require a party to produce electronically stored information in the form in which it is ordinarily maintained, as long as it is produced in a reasonably usable form ... If the responding party ordinarily maintains the information it is producing in a way that makes it searchable by electronic means, the information should not be produced in a form that removes or significantly degrades this feature.

Thus, GeoStar argued, “that it had the option to produce the documents in their native format or in an alternative format that was ‘reasonably usable’ and that did not ‘significantly degrade’ the searchability function of the documents.”

Plaintiffs’ response did not address the question of whether the data was “reasonably useable” but argued instead that production in native format would save them “hundreds of hours.”

Answering the questions of whether GeoStar’s production was “reasonably useable” and whether the lack of metadata ran afoul of the Federal Rules, the court determined that GeoStar had “not necessarily erred by producing the documents in .pdf and .tif formats.”  Indeed, the court noted that at the time of production plaintiffs did not have the software necessary for the requested native format data.

Despite finding that GeoStar had not violated the Federal Rules and that “the West Hill plaintiffs have received, to the best of the court’s knowledge, the production that their request sought,” the court ordered re-production in native format.  The sole rationale for the order was a prior promise from GeoStar to plaintiffs, in written correspondence, that it would provide the data in native format if plaintiffs chose to buy the necessary software.  Plaintiffs did so, and thus were able to enforce the promise.

Addressing the concerns of GeoStar’s CFO regarding native production, the court noted that a portion of information GeoStar claimed it needed to redact was in fact subject to disclosure.  The court also indicated its willingness to address any issue surrounding corrupted or older data if the need arose, but called GeoStar’s concerns regarding its ability to retrieve the data “incredible” in light of its apparent ability to retrieve the data for the initial production.

Finally, the court turned to the issue of cost and held that because GeoStar had already produced the information and because plaintiffs failed to specify the format of production in their request, “it is only fair to shift the reasonable cost of copying and delivering the second production to the West Hills Plaintiffs.”  Thus, GeoStar was ordered to provide plaintiffs with an estimate of the cost of production to which plaintiffs could respond with a directive to proceed, or not.

A copy of the full opinion is available here.

Full post as published by eDiscovery Law on February 11, 2009 (boomark / email).