08 Oct 2020

With advances in forensic tools, it has become increasingly common for courts to grant imaging orders (in support of search orders) for the quick and comprehensive preservation of electronically stored data on hard drives, laptops, etc. An advantage of imaging orders is that they allow the search process to be far less intrusive and disruptive for the business/premises that are being searched. On the other hand, a disadvantage is that the imaging process does not discriminate between documents that pertain to the issues of the proceedings and are covered by the search orders from documents that are irrelevant and/or privileged.

In a recent judgment that was highly critical of the conduct of the claimant and its solicitors on a number of fronts, the Court of Appeal[1] has spelt out the dangers to be associated with imaging orders and served a reminder that the orders were for the preservation of evidence and/or property, and not an alternative to the usual process of disclosure and inspection. The Court expressed the hope that, in the same manner that form and safeguards of search orders were eventually standardised by statute, the same would happen for imaging orders.

Background

The Claimant, TBD (Owen Holland) Limited (TBD), discovered that a competitor of TBD, G2A Limited (G2A), had been using photographs and technical material belonging to TBD, to approach TBD's customers and in its promotional materials. TBD alleged that the First Defendant (AS), former employee of TBD and then director of G2A, was also in breach of a confidentiality clause in his contract of employment by disclosing TBD's trade secrets. TBD also alleged copyright infringement by the Defendants in "design specifications, data sheets, quotations, pricing, structures, manufacturing designs/models and digital content contained on TBD's website and database" – the basis for which allegation was doubted by the Court of Appeal because of section 51 of the Copyright, Designs & Patents Act 1988.

Nevertheless, on 4 July 2018, the High Court, granted TBD orders for searching premises controlled by the Defendants, on a without warning basis. Such ex parte search orders were supported by an order permitting CY4OR, forensic computer experts, to accompany the team searching the premises, for the purpose of taking images of various hard drives, laptops and other electronic devices.

Following the execution of the search and imaging orders, TBD's then solicitors tried to reach an agreement with the Defendants, on the keywords and other parameters for the review of the searched documents in the images then in the possession of CY4OR. AS, acting as a litigant in person, objected to the nature and breadth of the keyword search that had been proposed by the Claimant. However, at a subsequent return day on the search orders (held on 18 February 2019), the objections of AS were not raised with the High Court and, shortly thereafter – despite the objections by AS and no agreement with the other Defendants – TBD's solicitors instructed CY4OR to carry out a search of the images in accordance with the Claimant's keywords list, the length of which list the Court of Appeal described as "on any view, extraordinary" [paragraph 44]. Indeed, TBD's then solicitors even added further keywords to the list. Moreover, subsequent to the analysis, the solicitors used some of the documents revealed to contact third parties including customers of the Defendants. 

Eventually, the circumstances behind the analysis by CY4OR of the searched and imaged documents (the Searched Material) was reviewed by the High Court and as result, on 17 January 2020, Mr Justice Marcus Smith held that TBD and its then solicitors had been in serious breach of the search orders and he ordered, inter alia, that TBD was required: (a) to provide, in short order, a comprehensive list of the documents comprising the Searched Material; (b) to hand over all of the imaged files to a third-party firm of solicitors, who will check whether the Searched Material contained any privileged, self-incriminating and/or irrelevant documents (the expense of which exercise would be borne by TBD); and (c) to explain, in detail (but without invading any privilege that may exist) what use it had made of the Search Material in terms of approaches to third parties (the Decision).

Please see our previous case commentary of the Decision, including guidance on what to do if faced with a search order, here

The Court of Appeal decision

When TBD appealed the Decision, it was dismissed save that it was held that, in order to reduce the cost for TBD of the exercise by the third party firm of solicitors, this review could be carried out by a firm already instructed by some of the Defendants.

Lord Justice Arnold, who gave the leading judgment, observed:

  • The purpose of a search order is the preservation of evidence, whether documentary or real, and/or property in order to prevent the defendant from altering, destroying or hiding such evidence or property if given notice. The purpose of inspecting documents during the course of the search, to the extent permitted by the order, is not an alternative to disclosure but rather to identify documents which should be preserved
  • The facts justifying a search order being made may also, in appropriate cases, justify the making of without notice orders for the disclosure and inspection of documents and/or the provision of information pursuant to either Civil Procedure Rules Part 18 or the court’s inherent jurisdiction, but nevertheless the two types of orders are distinct, require separate justification, have different effects and must not be conflated
  • Both search orders and orders for the disclosure and inspection of documents and/or the provision of information must contain proper safeguards for the respondent, and those safeguards must be respected during the execution of the order.

He recommended that solicitors carrying search orders should apply the following safeguards:

  • Once copies of the relevant material have been made, the material ought to be returned to its owner. The material need be retained no more than a relatively short period of time for that purpose
  • A detailed record of the material taken should always be required to be made by the solicitors who execute the order before the material is removed from the defendant's premises
  • No material should be taken from the defendant's premises by the executing solicitors unless it is clearly covered by the terms of the order
  • It is inappropriate that seized material should be retained by the claimant's solicitors pending the trial. A neutral officer of the court could be charged with the custody of the material
  • There must be proportionality between the perceived threat to the claimant's rights and the remedy granted.

Lord Justice Arnold commented how no standard form of imaging order has yet been developed but he hoped that in due time this would happen. Referring to CBS v Brown[2] and Hewlett Packard v Manchester[3], he highlighted the importance of the following safeguards when executing an imaging order. Notably, the order should contain a provision, agreed by all parties, for the inspection of the imaged documents detailing: (a) which party should go first in carrying out the searches; (b) the form of procedure for disclosure proposed by the claimant (by keywords or/and blacklist for example) and which should not involve disproportionate risks of the interference with the privacy rights not only of the defendants, but also of third parties; and (c) a clear procedure on the return dates to search the images which had been taken.

More specifically, the safe execution of imaging orders would usually necessitate that:

  • any copy or image taken of an electronic data storage device should be handed over by an independent computer specialist to the supervising solicitor who will keep it safely in his custody to the order of the court
  • the independent computer specialist should index the electronic copies according to the directions of the supervising solicitor
  • should there be an inspection of documents on the images by the claimant, it would need to be justified as a separate exercise, and analysed in terms of the disclosure jurisdiction
  • after the search of the premises has been completed, at the instruction (and according to the directions) of the supervising solicitor, the independent computer specialist should organise the material on the copies as appropriate in order to expedite the search of their contents. The applicant's solicitors and the independent computer specialist shall then be entitled to search for listed items upon such electronic copies but only on the conditions that:
    • the respondent be given 24 hours’ written notice of such search by the applicant's solicitors
    • the search take place under the supervising solicitor’s supervision
    • the respondent and its legal advisers shall be entitled to be present at such search
    • a representative of the applicant shall be entitled to be present at such search for the purpose of assisting in identifying the listed items
    • the applicant's solicitors shall be entitled to take copies of any listed items found, subject to the respondent's right to prevent the applicant's solicitors from taking a copy of any part of a document which the supervising solicitor believes to be privileged.

In the present case, the Search Order combined a traditional search with an imaging order and required the Defendants to provide for the imaging of their devices by computer experts "for subsequent analysis" but it was not explained what "analysis" was proposed or how the computer experts were expected to be able to carry out such "analysis".

Key lessons

The decision serves as a reminder that there must be a balance between the rights and the interests of the parties when granting imaging orders. It was emphasised that an imaging order is not allowed to become oppressive and claimants should not exceed the ambit of the order and any documents can only be used for the purpose of the proceedings. There is a danger of using broad keywords to review the images, resulting in extracts from privileged or potentially privileged documents being passed on to a claimant. If an analysis of the images is then to be performed, clear explanations of the procedures should be described and agreed in advance of the search. 

Secondly, safeguards must be respected during and after the execution of imaging orders. For example, it would be wise to require the images to be kept by the forensic computer expert and not to be searched or inspected until the return date. Any departure from the agreed search methodology should require a very high degree of justification and the court's specific and explicit approval.

Finally, turning to the responsibility of claimants and their lawyers with regard to the execution of the order, they must engage with the Court at all stages of the search order, to receive approval and guidance on how to handle the searched material – especially where the defendants are litigants in person.

Includes contribution by Catherine Bailey, Trainee Solicitor

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[1] TBD (Owen Holland) Limited v Andrew Simons & Ors [2020] EWCA Civ 1182

[2] CBS Butler Ltd v Brown [2013] EWHC 3944 (QB)

[3] A v B and Hewlett Packard Enterprise Company v Manchester Technology [2019] EWHC 2089 (Ch)