Be prepared to adapt your litigation and cost management strategies to the new amendments to the Federal Rules of Civil Procedure (“FRCP”) which will take effect on December 1, 2015. The amendments follow a four-year effort by the Civil Rules Advisory Committee in response to mounting concerns about the costs of litigation, particularly discovery and e-discovery. The aim of these amendments is to foster cooperation, expedite case management, infuse the concept of proportionality into the discovery rules and better regulate e-discovery.

A series of amendments were collectively approved to help ensure that judges and litigants manage cases early and actively and reduce delay at the beginning of litigation.
  • Amended Rule 4(m) – The presumptive time for serving a defendant with the summons and complaint is reduced from 120 days to 90 days
  • Amended Rule 26(d)(2) – The drafters created an “early Rule 34 request,” which guarantees litigants a right to serve requests for production 21 days after the defendant is served with the summons and complaint, “even if the Rule 26 scheduling conference has not yet been held”
  • Amended Rule 16(b)(2) – The court must now issue its scheduling order 30 days earlier (90 days after any defendant has been served or 60 days after any defendant appears)
  • Amended Rule 16(b)(1)(B) – The scheduling conference must now be a “direct simultaneous communication” between the parties and the court. The goal is to have more productive and complete communication at the early stages of litigation. Mail or email no longer suffice, and the conference must either be held “in person, by telephone, or by more sophisticated electronic means,” such as a videoconference. Requiring an earlier, instantaneous conference in front of the court will force litigants to address electronic discovery issues at the onset of the litigation

Proportionality has been codified as a limitation to the scope of discovery. Amended Rule 26(b)(1) maintains the original requirement that material must be non-privileged and relevant to be discoverable. But Amended Rule 26(b)(1) mandates that discovery must be “proportional to the needs of the case.” The amended rule specifies that a court considering the proportionality of a discovery request should consider:

  1. the importance of the issues at stake in the action
  2. the amount in controversy
  3. the parties’ relative access to relevant information
  4. the parties’ resources
  5. the importance of discovery in resolving the issues
  6. whether the burden or expense of the proposed discovery outweighs its likely benefits

The amendment to Rule 26(b)(1) also deletes the sentence, “[r]elevant information need not be admissible at trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence,” and replaces it with “[i]nformation within this scope of discovery need not be admissible in evidence to be discoverable.” This change is the drafters’ response to the growing realization that the phrase “reasonably calculated to lead to the discovery of admissible evidence” had taken on a life of its own, leading to a de facto expansion of the scope of discovery under Rule 26(b)(1).

Amended Rule 26(b)(1) should shift courts’ focus to a cost/benefit analysis and lead to less disproportionate discovery. Although assessing the proportionality factors listed in Rule 26(b)(1) should reduce the costs associated with discovery, corporate counsel should note that factor number 4 (“the parties resources”) invites courts to distinguish between individuals and corporations. Such a distinction could tempt courts to impose higher expectations on corporations than individuals during discovery.

Amendments to the Rules target the improved regulation and conduct of e-discovery. First, while the duty to preserve evidence and avoid spoliation has always existed, the Amended Rules emphasize the parties’ ongoing duty in the context of e-discovery. For example, Amended Rule 26(f)(3)(C) now requires the Rule 26(f) discovery plan to “state the parties’ views and proposals on…. (C) any issues about disclosure, discovery, or preservation of electronically stored information.” Requiring the parties to discuss preservation early will encourage more wide-spread use of prudent and responsible preservation practices, and comments to the Amended Rules remind practitioners that the duty to preserve evidence can arise even before litigation is filed.

Second, Rule 37(e), originally adopted in 2006, has been dramatically overhauled. The 2015 Comments clarify that the original Rule 37(e) was “limited” and “has not adequately addressed the serous problems resulting from the continued exponential growth in the volume of [ESI].” The Comments also observe that “[f]ederal circuits have established significantly different standards for imposing sanctions or curative measures on parties who fail to preserve electronically stored information” since the passage of original Rule 37(e). Amended Rule 37(e) is a sanctions-based response to add effectiveness and uniformity to courts’ response to e-discovery violations.

Rule 37 Chart
Rule 37(e)(1) Rule 37(e)(2)

Preconditions for sanctions:

  1. ESI should have been preserved in the anticipation or conduct of litigation
  2. that ESI is lost
  3. loss occurs because offending party fails to take reasonable steps to preserve that ESI (i.e., there is at least some level of culpability required)
  4. the ESI cannot be restored or replaced through additional discovery
  5. the non-offending party is prejudiced from the loss of the ESI

Preconditions for sanctions:

  1. ESI should have been preserved in the anticipation or conduct of litigation,
  2. that ESI is lost,
  3. loss occurs because offending party fails to take reasonable steps to preserve that ESI,
  4. the ESI cannot be restored or replaced through additional discovery, and
  5. the court must find that the offending party acted with the intent to deprive another party of the information’s use in the litigation (i.e., the court must find a very egregious level of culpability).

To remedy, the court may:

  • “order measures no greater than necessary to cure the prejudice”

To remedy, the court may:

  • “presume that the lost information was unfavorable to the party,”
  • instruct the jury that it may or must presume the information was unfavorable to the party,”
  • “dismiss the action or enter a default judgment,” or
  • per the Comments, craft a case-specific remedy to “fit the wrong”

At this nascent stage, it is impossible to predict the specific long-term effects of each individual amendment to the FRCP. For instance, it is unknown whether courts will evaluate the proportionality factors using a “totality of the circumstances” type of test or whether certain factors will come to predominance as the jurisprudence develops. One thing is certain though, practitioners around the country must be prepared for these new changes because even cases currently pending are subject to these new changes once they take effect December 1, 2015.

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