Electronic Data Records Law | How to Win E-Discovery

Electronic Discovery Professional Duty

Falsehoods and Duty of Confidentiality

What is an e-forensics specialist to do when she discovers her client has been lying to her?  Typically this kind of computer specialist is hired to find, audit and report on electronically stored information (ESI).  If the specialist has been making representations to others -- such as a court, an internal investigator or an inspector general who has issued a subpoena, on the basis of what she now knows to be lies, she is in a bind.  Like any professional working for a client on a sensitive matter, the specialist will likely owe the client a duty of confidentiality.  Normally she will have signed a non-disclosure agreement. 

How to Preserve Reputation?

The specialist’s reputation is at stake. Obviously, to disassociate herself from misrepresentation, she can withdraw from the engagement.  But she fears that the third party will continue to rely on her representations, which are no longer well-founded. 

A practical technique available to this specialist is known as the noisy withdrawal.  Although noisy withdrawal is most commonly known from cases where lawyers learn that their clients have been lying to them, the technique is a responsible measure available any ethical professional.  

In a noisy withdrawal a professional announces that he is withdrawing from representation of his client. In addition (this is the noisy part) he declares to interested third parties that he disaffirms his prior statements made on behalf of the client.  With the noisy withdrawal, the professional aims to preserve his own credibility, without compromising the client’s secrets.  He does not reveal why he is withdrawing, why he is disclaiming prior statements or any information his client has told him.

Examples of Noisy Withdrawal

A recent example of a noisy withdrawal occurred in the investigation of Stanford Financial Group. Attorney Thomas Sjoblom had represented the firm before the Securities and Exchange Commission as it examined alleged fraud, corruption and irregularities.  But then he made a noisy withdrawal from the engagement.  Observers surmised that as the case progressed he had come to disbelieve what his client had been telling him. Kara Scannell, “Top Lawyer’s Withdrawal from Stanford Case Waves a Flag,” Wall Street Journal, Mar. 6, 2009.

Another famous example transpired in the Whitewater investigation during the Clinton presidential administration.  Legendary ethics expert Sam Dash made a noisy withdrawal when the Whitewater Independent Counsel wrongly gave the impression that Professor Dash endorsed the Counsel’s conduct.  (By the way, prior to this story, the late Sam Dash was my ethics professor in law school.  Over the long run, I hope Professor Dash’s teaching helps me stay out of trouble!)

–Benjamin Wright

Mr. Wright teaches cyber defense law at the SANS Institute, where he emphasizes the role of ethics and savvy public communications.

Health-care eDiscovery | Email Destroyed

Duty to Preserve Electronically Stored Information (ESI)
Standard for E-mail Litigation Hold

When a lawsuit is filed or reasonably anticipated, parties are expected to apply a litigation hold to ensure records are not destroyed (which includes ensuring emails are not erased).

In a class action case concerning rights to state-paid medical care (connected with Medicare), a federal trial court has criticized Tennessee state agencies (Defendants) for failing to preserve electronic records.  Said the court:

"Defendants left their employees to decide on their own what to retain without evidence of any written instruction or guidance from counsel on what is significant o[r] material information in this complex action.  Under the State's computer system, after six to seven months emails were destroyed.  Some key custodians did not have backup tapes for their work station computer.  Given the complexity of this action, isolated statements [from counsel to employees] about the litigation hold over a period of several years are equivalent to the lack of any meaningful litigation hold." John B. v. Goetz, 2007 WL 3012808 (M.D. Tennessee Oct. 10, 2007), Memorandum, page 126.

The court went on to criticize the inadequate litigation hold at Defendants' contractors.

The court’s statements open the possibility for e-discovery sanctions against Defendants.    

The case reminds how courts can scrutinize e-mail retention decisions years after the decisions are made.  It illuminates the danger when an enterprise leaves retention and destruction responsibility in the hands of individual employees (or contractors), who may not be fully aware of the legal implications of that responsibility.  Accordingly, I advocate generous, centralized retention of enterprise e-mail and text messages.  By "centralized," I mean the records are retained in an enterprise-controlled archive such that employees cannot destroy their individual records.

Here a federal court second-guessed Tennesee state agencies.  But in theory the state involved could just as easily have been Iowa, Oregon, Nevada, Texas, Idaho or any other.

–Benjamin Wright

Mr. Wright is an advisor to Messaging Architects, leading provider of e-mail archival solutions for healthcare.  He also teaches e-data law at the SANS Institute.

Healthcare Internal Control: Retained E-mail & IM Records

Board of Directors Fiduciary Duty

Medicare Compliance & Fraud Investigations

Electronic records such as e-mail do more than satisfy discovery requests in litigation. They serve as a check against mistake, fraud, overcharge, kickbacks, tax evasion, false records, misappropriation of funds-assets and other misconduct. Healthcare institutions need to retain these records to enable investigations of misconduct on the part of administrators or other decision-makers.