Heriot v. Byrne, 2009 U.S. Dist. LEXIS 22552 (N.D. Ill. Mar. 20, 2009)
To assist them in complying with a production request, responding party hired a vendor to provide scanning and other services associated with discovery. The Vendor created a “master database” that responding party used to conduct their document review. Documents designated for production were then copied to a “production database,” where they would be “marked” with an appropriate confidentiality designation.
Responding party sent hard copy versions of immigration documents to the vendor with instructions to digitize the documents, load them into the Master Database, copy them to the Production Database, apply the appropriate confidentiality legend and bates numbers, and include them in the next production. The vendor, however, mistakenly exported not only the requested documents, but other, privileged documents as well. This resulted in the inadvertent production of privilege. The error was not in the instructions given to the vendor, but was in the vendor’s execution of those instructions. Requesting party then filed a motion
During the production, requesting party asked the responding party if any documents had been withheld due to privilege. Responding party answered in the negative. Responding party subsequently learned of the error, and informed opposing counsel while requesting the documents be destroyed. Opposing counsel destroyed all documents but one set, which it filed under seal with the court. They then filed motions with the court requesting, inter alia, that the court prevent the “claw back” of the documents and instead compel their production. Responding party asserted that the documents were privileged.
The court began its analysis by determining that FRE 502 applied to the case, and crafting a new protocol for deciding whether inadvertent production necessitates the waiver of privilege (see our case blurb here).
Based on the results of an in camera review, the court decided that the documents at issue were privileged, and that the crime-fraud exception does not apply.
The court applied FRE 502(b) by considering: 1) whether disclosure was inadvertent; 2) whether responding party took reasonable steps to prevent disclosure; and 3) whether responding party took prompt steps to rectify the inadvertent disclosure. The court noted that prior to the promulgation of the new rule, the burden rested with the party claiming privilege to prove its contentions. The court saw no reason to shift this burden.
In determining whether a production was inadvertent, the court weighed such factors as: the total number of documents reviewed, the procedures used to review the documents before they were produced, and the actions of producing party after discovering that the documents had been produced.
Additionally, the court examined “the extent of the disclosure” and “the scope of discovery,” while commenting that these two factors operated on a sliding scale: the broader the scope of the discovery, the more extensive a party’s disclosure of confidential materials may be without waiving the privilege, and vice versa. The court noted that the privileged documents comprised 5% of the volume of pages produced, and 13% of the volume of the documents produced, labeling these figures neither apoplectically large nor astonishingly small. The court described the extent of the disclosure as being “broad” and the magnitude of the percentages as “not insignificant.” Nevertheless, the court found other factors more significant for the purpose of its analysis, particularly the actions of the producing party upon discovering the mistake. Because the responding party took immediate action, the court decided that the first factor weighed in favor of responding party, concluding that the production was inadvertent. The court then addressed the second factor of its test, the party’s steps to remedy the inadvertent disclosure. Therefore, as long as reasonable procedures were in place prior to “turning the documents over to the vendors,” the responding party met its obligations. The court concluded, therefore, that responding party did take reasonable measures to prevent inadvertent production.
In beginning the second part of its three-step analysis, the court cited the advisory committee’s notes that it may, in making this determination, consider several factors, including “the number of documents to be reviewed and the time constraints for production”; whether “a party that use[d] advanced analytical software applications and linguistic tools in screening for privilege and work product”; and whether “[t]he implementation of an efficient system of records management before litigation.” The court emphasized that the producing party was not required to engage in a post-production audit, although it was required to follow up on any obvious indications that a protected communication or information has been produced inadvertently.
In the third and final part of its analysis, the court stated that case law it unearthed stood for the proposition that how the disclosing party discovers and rectifies the disclosure is more important than when after the inadvertent disclosure the discovery occurs. In the case at bar, responding party discovered the error earlier than had the responding parties in the cases examined by the court, and were as diligent. In those cases, the disclosing parties were found to have acted appropriately. Therefore, the court found that Plaintiffs took prompt steps to rectify their inadvertent disclosure.
The court concluded that the responding party’s disclosure was inadvertent and that they did not waive the attorney-client privilege as to the Sequestered Documents.
