Very few documents these days begin as paper; most are created on computers. In the discovery process of litigation therefore, dealing with digital data is of growing importance. As litigants increasingly seek computer files, issues concerning who bears the cost of the production have arisen. The rules governing discovery and cost-shifting have not changed, but the move from paper to digital files has changed the factual circumstances. The days where one side could point the other to a warehouse of boxes and allow the other side to look through them may be coming to a close. While one might be able to point an opposing party to your server farm and other digital storage sites and allow “looking through them,” doing so would be a very bad strategy. Especially when it comes to restoring back-up media or other relatively inaccessible data, some litigants have tried to shift the cost of recovery to the requesting party (typically the responding party pays).
Last week, an important case in the Southern District of New York further clarified the rules of cost-shifting in e-discovery. While this is a district court opinion only, lawyers with whom I have spoken tell me that the opinion is likely to be very influential. In Opinion and order re: Zubulake v. UBS Warburg, the court lays out a set of factors to consider in cost shifting. This decision, along with a prior ruling in the same matter lay out clearly the legal reasoning for when cost shifting is appropriate. The two decisions also include a useful discussion of different types of computer storage and point out that the media/systems issues can often be thought of in terms of what is accessible and what is (relatively) inaccessible. It is the accessibility that is important, not so much the media.
For those interested in e-discovery, these decisions are worth reading.