Transcript Batten Down the Hatches and Run Before the Wind:

Batten Down the Hatches and
Run Before the Wind:
How to Implement an E-Records
“Hold” Without Wrecking the Ship
(MER, May 22, 2005)
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Shipwrecks
• Arthur Andersen
– Criminal conviction of the CORPORATION
– Out of business
• Cobell v Norton
– Agency’s web site shut down
– Cabinet officials held in contempt of court
• Zubulake Jury Instruction
– Jury told to presume “bad faith”
– Jury awards plaintiff $29.2 million
• Morgan Stanley
– Lawyer disbarred
– Jury awards plaintiff $1.4 BILLION
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Who We Are:
• John Paul Deley
Records Officer
Energy Information
Administration
• [email protected]
• 202-586-6257
• Kenneth J. Withers
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Senior Education
Attorney
[email protected]
202-502-4065
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Who You Are:
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Attorneys
Records Managers
Information Technology Professionals
Business and Government Leaders
Members of the Public
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Goals of the Workshop:
• To define the conditions that surround an e-records
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“hold” and best practices for responding to one/many.
To outline preventative measures that can be taken to
minimize liabilities associated with “freezing” and
maintaining e-records.
To test e-record holds policies in the context of a
common legal framework
To establish a framework for better understanding the
relationship(s) between RM, I/T and legal counsel and
program managers in an e-records environment.
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Overview of the Day:
10:00 - 10:10
10:10 - 11:20
11:20 - 11:35
11:35 - 12:45
12:45 - 1:45
1:45 - 2:00
2:00 - 2:45
2:45 - 3:15
3:15 - 3:30
3:30 - 4:15
4:15 - 4:45
4:45 - 5:00
Introduction and Overview
Defining the Dilemma: The Approaching Storm
Break (15 minutes)
Charting the Legal Seas
Lunch (1 hour)
Case Study: Orders from the Admiral
Group Problem One: Battening Down the Hatches, or Who's
Manning the Life Boats?
Reporting to the Captain
Break (15 minutes)
Group Problem Two: Is it "Flotsum" or "Jetsum?" Salvaging
the Cargo
Reporting to the Captain
Wrap-up and Evaluation
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Establishing a Common Language:
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What are “Records”
What is a “E-Records Hold”
How can “records” be “evidence”
Unique challenges of e-records
Importance of e-records policy
What is records “Life Cycle”
What is “preservation”
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Definitions of Record
• International Council on Archives
• Uniform Rules of Evidence Rule 1001(a)
• Federal Rules of Evidence Rule 1001(1)
• Federal Records Act
• State Records Acts
• ISO 15489
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ERC of the ICA transactional records are defined
as:
• recorded information
• in any form, including data in computer
systems,
• created or received and maintained
• by an organization or person
• in the transaction of business or the
conduct of affairs
• and kept as evidence of such activity.'
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Our Definition of Record for Today
• Information regardless of medium or
format, that has value to an organization.
Collectively, the term is used to describe
both documents and electronically stored
information.
• E-records for today’s discussion should be
scheduled, certified and documented.
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Electronic Discovery can involve:
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E-mail
Web pages
Content management Systems
Data “warehouses”
“Off-line” e-storage
GIS and Media Files
Etc…
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Examples of how ER’s have been
used as “evidence”
• Document a business transaction
• Document a decision
• Document a condition or environment
• Can be used to enforce an obligation
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Differences between
electronic “stuff”
Official records
• Have value – fulfills a
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specific purpose
Document administrative,
legal, fiscal policies and
decisions
Dissemination qualities
Serve as legal “evidence”
Preserve historical
memory
Non-records
• Duplicative
• Information that does not
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meet “official criteria”
Personal papers
Can be subject to
discovery or investigation
Extraneous (system files,
cookies, slack)
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Unique challenges of managing
electronic media
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Not an artifact – intangible
The custodial problem
The proliferation problem
The viewing problem
The scrambling problem (mutations)
The inter-relation problem
The translation problem
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Attributes of E-Records:
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Timeliness
Reliability
Accuracy
Completeness
Integrity
(Authentic records are trustworthy)
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Components of ERM Policy
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Purpose and Framework (Context)
Authority and Scope
Definitions and Implementation Plan
Custodianship and Registration
Schedule Citations and Technical References
Vital Records and Disaster Recovery
Access, Preservation and Back-up
Documentation
Security and Policy Audit
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Sources of E-Records Guidance:
• “The Law” – Statutory, Regulatory, and
other “Principles” (Obligations to preserve
“evidence”)
• Professional Standards for Industry
Groups
• Best practices commonly accepted by
individual communities
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Electronic Records Lifecycle
• “a sequence of events that mark the
development and use of an information
resource”
• An example – create a draft, revise an
article, publish a book, acquire a library,
transcribe to magnetic disk, migrate to
optical storage, translate to English, etc…
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What is a Records Schedule?
• A plan for the management of records,
listing types of records (systems or series)
and how long they should be kept; the
purpose is to provide continuing authority
to provide control for records at each
stage of their life cycle.
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Some Necessary Functionalities
For E-Record Systems:
• Security
• Schedule Implementation
• Record Content Identification and
Segregation
• Selecting and Retrieving Records
• Transferring, Migrating, Auditing and
Destroying Records
• Access Control, Backups, etc…
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Custodians of Records:
• Individual responsible for the physical
protection of records throughout their
retention period.
• May change during records life cycle but
organization should always be
accountable
• Content custodian / Technical custodian
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Importance of an Electronic
Records Management Policy
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Mitigates the problems
Establishes a common language
Assigns responsibility
Protects value
Creates value
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Litigation Response Plan
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No “safe harbor,” only lighthouses
STOP! LOOK! LISTEN!
Scope of the plan
Delegating authority
Search and identification procedures
Certification procedures
Access, maintenance, and preservation
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What is a Records “Hold”
• Communication issued as a result of
current or anticipated litigation, audit,
investigation or other such matter that
suspends the normal disposition or
processing of records.
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Some Reasons for a Records Hold:
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Personnel Matter
Financial or Program Audit
Impending or Anticipated Litigation
Health and Safety Issues
Changing Regulatory Requirements
Congressional Inquiry / Press Inquiry
Best interest of Public
ETC…
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Irony of Modern
“Preservation” Media:
• As “Information Density*” goes up – Life
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Expectancy of Data goes down.
Clay Tablet 10,000 years
Papyrus 5,000 years
Microfilm 300 years
Newsprint 50 years
Magnetic Tape 30 years
Optical Disc 5 Years
(Characters Per Square Inch)
(50)
(50)
(900)
(300)
(10,000)
(51,000,000)
(PAUL CONWAY, “Preserving the Digital World”, 1996)
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Ways Producing E-Records Differ
from Traditional Records
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Volume and Duplicity
Persistence
Dynamic, Changeable Content
Metadata
Environment Dependence / Obsolescence
Dispersion and Searchability
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Systems Documentation:
• Records REQUIRED to plan, develop,
operate, maintain, and use electronic
records, including, but not limited to –
system specifications, codebooks, record
layouts, user guides and output
specifications.
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Metadata
• Standards for cross-domain information
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resource access and exchange – promote
interoperability
Element set – “descriptors” specific to process
and application
Ideally, metadata are semantically rich and
specific (tourist “browsing across international
lines”)
Facilitate use of controlled vocabulary and
“authority file”
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4 Strengths of
Organizational Culture
1. Attention on the human side; strong
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leadership; significance in even the most
mundane functions
Create shared meaning to work together for
desired outcome
Every individual must acknowledge impact of
their behavior on group’s
Relationships are affected by environment
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4 Priorities in Good
Organizational Culture:
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Purpose more important than process.
Service more important than authority
Reality more important than form
Adaptability more important than
precedence.
(Gerald E. Calden, “The Dynamics of Public Administration,” 1971, p. 8)
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Who Needs to be “at the table”
When an e-records hold is required
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The Records Manager
The Appropriate Program Staff
I/T Staff and/or CIO
Legal Counsel
Possibly Senior manager, CFO or
representative and Press Officer
depending on situation
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Ways to Minimize Risks:
• 1) RM integrated into “enterprise architecture”
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plan
2) Records management plan with up-to-date
record schedules,
3) Way of identifying staff who are “experts” in
content areas, including links to traditional
legacy materials, and
4) Method of “certifying” the authenticity of its
collection methodologies.
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Look for E-Records
Where they Were:
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CREATED or COLLECTED
LINKED or INTEGRATED
REVIEWED or DISSEMINATED
ACCESSED or MODIFIED
MAINTAINED, MIGRATED or STORED
ARCHIVED or PRESERVED
AUDITED, REDACTED or CATALOGUED
SEGREGATED, EDITED or REFINED
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Tools for Easing an
E-Records Search:
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Enterprise Architecture
E-Systems Inventory
Documentation Standard – Central Repository
Taxonomy
Ontology
Thesaurus
Authority List
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What is a Litigation Inventory:
• A litigation inventory (needs assessment)
identifies (targets) those series or
components of the electronic infrastructure
that might be “reasonably expected” to be
necessary during any potential discovery
process by an individual, organization or
community.
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HOW TO PREPARE
• Litigation Inventory:
– Assessment of What you have (inventory)
– Assessment of What is relevant
– Establishing procedures for Preservation
– Execution and Certification
– Quality Control and Evaluation (ongoing)
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Why Conduct a
Litigation Inventory:
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identify record value
reduce risk
identify record context
identify significant events and
establish an auditable procedural history
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A Litigation Inventory Includes:
• What have we learned from past court experiences?
• What changes in behavior and performance are to be
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“reasonable expected”?
What electronic records have been / will be crucial to
defending the interests and mission of the organization?
What are the expected economic costs and benefits of
any projected solutions?
What are the public relations, organizational culture, or
historic costs of electronic solutions? How does the
inventory support the core business plan?
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Steps in Conducting
a Litigation Inventory:
• Step 1. Perform a "GAP“ analysis.
• Step 2. Identify Priorities and Importance of
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Information.
Step 3. Identify Causes of Legal Performance
Problems and / or Opportunities.
Step 4. Identify Possible Solutions (incl. I/T)
and Growth Opportunities.
STEP 5: Compare the consequences if the
inventory is or is not implemented
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Questions:
BREAK
Relax for 15 Minutes
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Overview of
Records Management Law
Relating to “Holds”
• Not a well-defined legal topic
• Difficult to research
• Few publications, courses, or specialist
practitioners
• www.kenwithers.com/articles
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Records as legal evidence:
• Authentication
– Is this what it purports to be?
• Admissibility
– Is this relevant to the case?
• Overcoming hearsay objection
– Is this reliable, despite the lack of a witness
with personal knowledge of the facts?
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Records and Discovery
• Discovery under FRCP 26 is very broad
• “Discoverability” is broader than
“admissibility”
• Use of the term “record” is avoided
• The term “data compilations” has been
interpreted to include all things digital
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Records and Discovery:
• Judge has power to limit “permissible”
discovery under FRCP 26(b)(2)
• Parties have the right to ask judge to limit
discovery under FRCP 26(c)
• Considerations of cost/benefit, likelihood
of success, privilege, burden, “relieving
oppression” can be weighed by judge
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Records and Discovery:
• FRCP 26(a) places affirmative duty on parties to
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disclose, up front, information they may use to
support their case
FRCP 26(f) requires the parties to meet and
confer on a discovery plan before starting
– Logic dictates a broader disclosure
• FRCP 16(b) generally requires a conference
with the the judge
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Records and Discovery:
• FRCP 30(b)(6) allows a deposition of an
unnamed person, qualified to answer
questions on behalf of an organization
– “Records keeper” deposition
• FRCP 34 governs discovery (as opposed
to disclosure) of documents
• FRCP 37 allows judge to impose
sanctions
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Possible sanctions under Rule 37
• FRCP 37 sanctions may be imposed for failure
to disclose or respond to discovery, or for
evasive or incomplete answers
– No showing of intent necessary
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Order establishing a disputed fact
Order denying a claim or defense
Contempt of court, with possible fines
Judgment by default
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Spoliation:
• Destruction of evidence needed by
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another
Historically a tort action against a third
party
Can trigger a Rule 37 sanction
Can be a separate tort in a few states
Under Rule 37, no intent is necessary
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Spoliation questions
• When does the duty to preserve evidence
arise?
– When discovery request is received, or
– When action is filed, or
– When litigation is reasonably anticipated?
• …and what is the scope of the duty to
preserve?
– Can only be defined by the facts of the case
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Spoliation questions
• What is the relationship between spoliation
and violation of statutory or regulatory
record retention requirements?
– Duty to retain relates only to those intended
beneficiaries in statute or regulation
– BUT, failure of RM policy to meet legal
requirements may be evidence that policy is
not adequate
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Spoliation questions
• What is the relationship between spoliation
and routine records disposition, subject to
a records management policy?
– Lewy v. Remington Arms: RM policy must
have a “litigation hold” mechanism
– Carlucci v. Piper Aircraft: RM policy must not
be cover for selective destruction in
anticipation of litigation
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Spoliation questions:
• Do routine computer operations constitute
spoliation?
– Bell v. Cheyenne Software: routine recycling
of backup tapes must be halted during
litigation
– GTMF v. Wal-Mart: sanctions may be imposed
for routine data destruction during litigation
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Spoliation Questions:
• Does this extend to unintentional data
destruction?
– Gates Rubber v. Bando Chemical: negligent
actions by computer expert during discovery
– Residential Funding v. DeGeorge Financial:
“purposeful sluggishness” in migrating data to
useable format or media may be tantamount
to spoliation
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Weighing benefits and burdens
• Traditional view is that organizations
choose their record keeping systems and
assume the costs
– Kozlowski v. Sears Roebuck: “to allow a
defendant whose business generates
massive records to frustrate discovery by
creating an inadequate filing system, and then
claiming undue burden, would defeat the
purposes of the discovery rules.”
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Weighing benefits and burdens
• Defining what burden is “undue”
• Is the requested discovery within the scope of
what the records management system should
reasonably anticipate?
– In Re Air Crash Disaster at Detroit Metropolitan
Airport: not in this case
– In Re Brand Name Drugs Prescription Litigation:
respondent must assume reasonably anticipated
costs of doing business
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Weighing benefits and burdens
• Recognizing both the necessity and
complications of information technology
– Rowe Entertainment v. William Morris
Agencies: eight factors to consider in
allocating costs; purpose for maintaining data
is one
– Zubulake v. UBS Warburg: five levels of
accessibility
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Emerging duties to create and
maintain records
• Accounting scandals
• Sarbanes-Oxley Bill (signed into law July 30,
2002)
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Retention requirements for accounting papers
New criminal penalties for “shredding”
Common sense legislative history
Safe harbor provision
• Cobell v. Norton
– Contempt proceedings for failure to establish a
reliable and secure electronic business process
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What Are the Sedona Principles
Related to Document Production:
• www.TheSedonaConference.org
• “Think tank” of attorneys, judges,
corporate executives, records
management professions
• Goal is to identify problem areas and state
“best practices” in general terms
• To legal inform decision making at all
levels- management, legal, judicial
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #1
• Electronic data and documents are
potentially discoverable under Fed. R. Civ.
P. 34 or its state law equivalents.
Organizations must properly preserve
electronic data and documents that can
reasonably be anticipated to be relevant to
litigation.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #2
• When balancing the cost, burden, and need for
electronic data and documents, courts and
parties should apply the balancing standard
embodied in Fed. R. Civ. P. 26(b)(2) and its state
law equivalents, which require considering the
technological feasibility and realistic costs of
preserving, retrieving, producing, and reviewing
electronic data, as well as the nature of the
litigation and the amount in controversy.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #3
• Parties should confer early in discovery
regarding the preservation and production
of electronic data and documents when
these matters are at issue in the litigation,
and seek to agree on the scope of each
party’s rights and responsibilities.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #4
• Discovery requests should make as clear
as possible what electronic documents
and data are being asked for, while
responses and objections to discovery
should disclose the scope and limits of
what is being produced.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #5
• The obligation to preserve electronic data
and documents requires reasonable and
good faith efforts to retain information that
may be relevant to pending or threatened
litigation. However, it is unreasonable to
expect parties to take every conceivable
step to preserve all potentially relevant
data.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #6
• Responding parties are best situated to
evaluate the procedures, methodologies,
and technologies appropriate for
preserving and producing their own
electronic data and documents.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #7
• The requesting party has the burden on a
motion to compel to show that the
responding party’s steps to preserve and
produce relevant electronic data and
documents were inadequate.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #8
• The primary source of electronic data and
documents for production should be active data
and information purposely stored in a manner
that anticipates future business use and permits
efficient searching and retrieval. Resort to
disaster recovery backup tapes and other
sources of data and documents requires the
requesting party to demonstrate need and
relevance that outweigh the cost, burden, and
disruption of retrieving and processing the data
from such sources.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #9
• Absent a showing of special need and
relevance a responding party should not
be required to preserve, review, or
produce deleted, shadowed, fragmented,
or residual data or documents.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #10
• A responding party should follow
reasonable procedures to protect
privileges and objections to production of
electronic data and documents.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #11
• A responding party may satisfy its good
faith obligation to preserve and produce
potentially responsive electronic data and
documents by using electronic tools and
processes, such as data sampling,
searching, or the use of selection criteria,
to identify data most likely to contain
responsive information.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #12
• Unless it is material to resolving the
dispute, there is no obligation to preserve
and produce metadata absent agreement
of the parties or order of the court.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #13
• Absent a specific objection, agreement of the parties or
order of the court, the reasonable costs of retrieving and
reviewing electronic information for production should be
borne by the responding party, unless the information
sought is not reasonably available to the responding
party in the ordinary course of business. If the data or
formatting of the information sought is not reasonably
available to the responding party in the ordinary course
of business, then, absent special circumstances, the
costs of retrieving and reviewing such electronic
information should be shifted to the requesting party.
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SEDONA E-DOCUMENT
PRODUCTION PRINCIPLE #14
• Sanctions, including spoliation findings,
should only be considered by the court if,
upon a showing of a clear duty to
preserve, the court finds that there was an
intentional or reckless failure to preserve
and produce relevant electronic data and
that there is a reasonable probability that
the loss of the evidence has materially
prejudiced the adverse party.
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What is “reasonable?”
• Balancing standard of Rule 26(b)(2)
• Requesting party: Relevance to issues
– “Claims and defenses”
– “Subject matter”
• Responding party: Burdens of production
– Accessibility
– Cost
– Privilege
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QUESTIONS?
LUNCH BREAK
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