An Employer’s New Obligation for Document Retention and Preservation
By Ryan T. Neumeyer Employees today create, store and transmit hundreds of documents each day through their desktop computers, laptops, PDA’s, cellular phones and memory sticks. What happens when your company finds itself in a lawsuit where various electronic documents are requested by an opposing party during the “discovery” process? For those of you out there lucky enough to never have been subjected to a past lawsuit, “discovery” is the period of time, after the onset of a lawsuit and before trial, where parties to a lawsuit will request and attempt to “discover” as much crucial information from the opposing party as possible. When it comes to discoverable documents, a person generally thinks of huge files filled with thousands of paper documents. However, electronic documents are much more prevalent in 2007 and federal law is catching up to address “electronically stored information” or “ESI.”
The Federal Rules of Civil Procedure changed at the end of 2006 to include new provisions, which require a party in litigation to discuss the preservation of ESI at the initial pretrial hearing. These rule changes also significantly increase the degree of knowledge that attorneys must have regarding their client’s potentially discoverable ESI, computer systems and record retention policy prior to the initial discovery conference. Accordingly, the new rules impact the obligations of an employer to both retain and be able to retrieve all relevant ESI during discovery. Moreover, given that Ohio’s rules of civil procedure mirror the federal rules, it is probable that some courts may follow some of the federal rules relating to e-discovery and that Ohio may even someday adopt them.
The new rules place unique burdens on employers during litigation due to the one-sided nature of discovery in employment litigation. In employment litigation, the majority of discoverable information is usually possessed by the employer. While personnel files, time records and other important paper communications or documents are probably maintained by most employers, the underlying documentation for disciplinary notices or performance evaluations may be found in e-mails, on a supervisor’s PDA, on computer-generated calendar entries maintained by the employer or even on an employee’s own workplace computer. Similarly, electronic time-clock and electronic key-card data could be discoverable in a wide variety of employment matters.
Employers are responsible for maintaining all relevant data after they know or should have known that litigation is pending. The penalties for failing to do so can be very severe, including, but not limited to, monetary sanctions and having a plaintiff receive an evidentiary inference at trial.
Although it may seem like the burdens of e-discovery are huge, there a number of steps an employer may take to protect itself prior to the anticipation or onset of litigation. The new federal rules provide a “safe harbor” for the good faith destruction of electronically stored information or paper documents in the regular course of business. The “safe harbor rule” applies if the employer destroyed documents pursuant to a document retention program before it anticipated litigation. Accordingly, employers should adopt a written records retention and destruction schedule in compliance with applicable state and federal law. Doing so will permit employers to take advantage of the safe harbor rule in appropriate circumstances. In conjunction with the document retention program, an employer should also have a litigation-hold policy, which is a systematic plan to stop the destruction of discoverable material once the employer anticipates litigation.
In summary, every employer should be aware of the new federal rules and the issues employers now face throughout the discovery process. To ensure compliance, employers should consider all of their sources of electronically stored information and the best methods of records management for their organization.
Please do not hesitate to contact Lynn Schonberg or Ryan Neumeyer with any and all questions regarding e-discovery and/or document retention and preservation. Lynn and Ryan would be happy to assist your company in developing a document retention program and a litigation-hold policy.
|
