Summary
ordering former directors and officers of failed bank, who were "more likely to have an idea of what documents they are looking for in a particular request," to "propose search terms first; though since FDIC-R oversaw the loading of ESI into [its document database], it is expected to provide active assistance, and should anticipate consulting its technically skilled staff or contractors as necessary."
Summary of this case from Fed. Deposit Ins. Corp. v. BowdenOpinion
For W Holding Company, Inc., Plaintiff: Carlos A. Lazaro-Castro, LEAD ATTORNEY, San Juan, PR; PHV Andres Rivero, LEAD ATTORNEY, Rivero Mestre, Coral Gables, FL.
For Frank Stipes-Garcia, Juan C. Frontera-Garcia, Hector Del Rio-Torres, William Vidal-Carvajal, Cesar Ruiz, Pedro R. Dominguez-Zayas, Plaintiffs: Maria Paula Aguila, LEAD ATTORNEY, PRO HAC VICE, Rivero Mestre, Coral Gables, FL; PHV Andres Rivero, LEAD ATTORNEY, Rivero Mestre, Coral Gables, FL; Raul Gonzalez-Toro, LEAD ATTORNEY, San Juan, PR; Alan H. Rolnick, PRO HAC VICE, Andres Rivero, PRO HAC VICE, Charles E. Whorton, PRO HAC VICE, Rivero Mestre LLP, Miami, FL.
For Luis Bartolome Rivera Cuebas, as Trustee of the Socio Cultural Conservation Trust, Conjugal Partnership Rio-Diaz, Plaintiffs: PHV Andres Rivero, LEAD ATTORNEY, Rivero Mestre, Coral Gables, FL.
For Chartis Insurance Company-Puerto Rico, Defendant: Fernando Sabater-Clavell, LEAD ATTORNEY, Saldana & Carvajal, P.S.C., San Juan, PR; Luis N. Saldana-Roman, LEAD ATTORNEY, Saldana, Carvajal & Velez-Rive, PSC., San Juan, PR; Anjali C. Das, PRO HAC VICE, James K. Thurston, PRO HAC VICE, Wilson Elser Moskowitz Edelman & Dicker LLP, Chicago, IL.
For Marlene Cruz-Caballero, Conjugal Partnership Frontera-Cruz, Lilliam Diaz-Cabassa, Gladys Barletta-Segarra, Conjugal Partnership Vidal-Barletta, Hannalore Schmidt-Michels, Conjugal Partnership Ruiz-Schmidt, Sonia Sotomayor-Vicenty, Conjugal Partnership Dominguez-Sotomayor, Defendants: PHV Andres Rivero, LEAD ATTORNEY, Rivero Mestre, Coral Gables, FL; Raul Gonzalez-Toro, LEAD ATTORNEY, San Juan, PR.
For Jose M Biaggi-Landron, Jane Doe, Conjugal Partnership Biaggi-Doe, Defendants: Ruben T. Nigaglioni, LEAD ATTORNEY, Nigaglioni Law Offices PSC, San Juan, PR.
For Ricardo Cortina-Cruz, Elizabeth Aldebol de Cortina, Conjugal Partnership Cortina-Aldebol, Defendants: Raul Gonzalez-Toro, LEAD ATTORNEY, San Juan, PR; Jane W. Moscowitz, PRO HAC VICE, Norman A. Moscowitz, PRO HAC VICE, Moscowitz & Moscowitz, P.A., Miami, FL.
For Miguel A Vazquez-Seijo, Sharon McDowell-Nixon, Conjugal Partnership Vazquez-McDowell, Defendants: Roberto Buso-Aboy, LEAD ATTORNEY, Buso Aboy Law Office, San Juan, PR.
For Julia Fuentes del Collado, Defendant: Enrique Peral-Soler, LEAD ATTORNEY, Enrique Peral Law Offices, P.S.C., San Juan, PR.
For Mario A Ramirez-Matos, Defendant, Cross Claimant: Antonio J. Amadeo-Murga, LEAD ATTORNEY, A. J. Amadeo Murga Law Office, San Juan, PR.
For Cornelius Tamboer,Olga Morales-Perez, Conjugal Partnership Tamboer-Morales, Defendants: Gary H. Montilla-Brogan, LEAD ATTORNEY, San Juan, PR.
For XL Specialty Insurance Company, Defendant: Benjamin C. Eggert, PRO HAC VICE, David H. Topol, PRO HAC VICE, Karen L. Toto, PRO HAC VICE, Wiley Rein LLP, Washington, DC; Harold D. Vicente-Colon, Harold D. Vicente-Gonzalez, Vicente & Cuebas, San Juan, PR.
For Liberty Mutual Insurance Company, Defendant: Heidi L. Rodriguez-Benitez, LEAD ATTORNEY, Pietrantoni Mendez & Alvarez, San Juan, PR; Jack A. Wilson, PRO HAC VICE, Robin A. Henry, Boies, Schiller & Flexner LLP, Armonk, NY; Jason R. Aguilo-Suro, Pietrantoni Mendez & Alvarez, LLP, San Juan, PR.
For Ace Insurance Company, Defendant: Francisco E. Colon-Ramirez, Colon & Colon PSC, San Juan, PR; Katharine Bills Bowman, Michael Robert Goodstein, PRO HAC VICE, Bailey Cavalieri LLC, Columbus, OH.
For Frank Stipes-Garcia, Juan C. Frontera-Garcia, William Vidal-Carvajal, Cesar Ruiz, Pedro R. Dominguez-Zayas, Cross Defendants: Raul Gonzalez-Toro, LEAD ATTORNEY, San Juan, PR.
For Hector Del Rio-Torres, Cross Defendant: PHV Andres Rivero, LEAD ATTORNEY, Rivero Mestre, Coral Gables, FL; Raul Gonzalez-Toro, LEAD ATTORNEY, San Juan, PR.
For Federal Deposit Insurance Corporation, FDIC as receiver of Westernbank Puerto Rico- Plaintiff Intervenor, Intervenor: Carey L. Menasco, PRO HAC VICE, Elizabeth L. Baer, PRO HAC VICE,George Jr. Denegre, PRO HAC VICE, James A. Brown, Liskow & Lewis, New Orleans, LA; Erin L. Delatte, PRO HAC VICE, Liskow & Lewis, PLC, New Orleans, LA; Linette Figueroa-Torres, Manuel Fernandez-Bared, Toro, Colon, Mullet, Rivera & Sifre, PSC, San Juan, PR; Jane P. Van Kirk, Toro, Colon, Mullet, Rivera & Sifre, San Juan, PR.
For Chartis Insurance Company-Puerto Rico, Cross Defendant: Fernando Sabater-Clavell, LEAD ATTORNEY, Saldana & Carvajal, P.S.C., San Juan, PR; Luis N. Saldana-Roman, LEAD ATTORNEY, Saldana, Carvajal & Velez-Rive, PSC., San Juan, PR; Anjali C. Das, James K. Thurston, Wilson Elser Moskowitz Edelman & Dicker LLP, Chicago, IL.
OPINION MEMORANDUM OPINION
BRUCE J. McGIVERIN, United States Magistrate Judge.
This action involves numerous claims among the FDIC as receiver of Westernbank (" FDIC-R" ), former directors and officers of Westernbank (collectively, " D& Os" ), various insurers, and the FDIC in its corporate capacity (" FDIC-C" ). This case was referred for an initial scheduling conference. (Docket No. 305). Prior to the conference, FDIC-R proposed an order establishing a " protocol" for the discovery of Westernbank's electronically stored information (" ESI" ), and to reduce the number of written interrogatories. (Docket No. 359). Certain D& Os offered a competing protocol. (Docket No. 363). Oral argument was heard at the conference, and the parties were granted leave to provide additional briefing. FDIC-R filed an initial brief (Docket No. 391), the D& Os opposed (Docket No. 395, 398), and FDIC-R replied (Docket No. 406). For the following reasons, FDIC-R's request to alter the number of interrogatories is denied. A separate order will be issued to establish an ESI protocol.
BACKGROUND
The court summarized the general travel of the case and the nature of FDIC-R's claims in its opinion and order denying the D& Os' motions to dismiss; in short, it is a $176 million suit alleging D& O negligence in the course of making certain loans. (Docket No. 304). There have also been counterclaims, cross-claims, and third-party claims among the D& Os, FDIC-C, and the insurance companies. Prior to the initial scheduling conference, the parties noted their disagreement over the " protocol" for producing ESI held by FDIC-R, and filed competing proposals. (See Docket Nos. 359-1, 363). The court heard oral argument and granted the parties an opportunity for briefing. (Docket No. 372).
Ray Rivard, an FDIC-R employee, provided a written statement about the data FDIC-R is maintaining. (Docket No. 391-2, or " Rivard Decl." ). When FDIC stepped in as receiver for Westernbank, it " immediately" possessed approximately 6.8 terabytes of ESI and 921,000 paper documents. " Most" of this original material was brought into a system called DMS iConnect (" DMS" ), an internal database operated through a contractor. A subset of paper documents that FDIC " anticipated would be relevant to litigation against former directors and officers" were scanned into digital images and processed to generate searchable text. By this point, FDIC had spent $2.1 million. However, the contracts and sub-contracts for DMS are not litigation-specific, making it impractical to estimate the costs in this case with any greater detail.
FDIC plans to use a second contractor-maintained system called Relativity to give its litigation opponents searchable access to selected data. The FDIC will have to pay $450 per gigabyte to move data from DMS to Relativity. FDIC estimates its costs for producing documents to include: $0.185 per page for scanning paper documents and generating searchable text; $0.025 per page for Bates and confidentiality stamping; $325 per gigabyte for imaging native-format ESI into TIFF files; and $35 to $300 per labor-hour for technicians, quality control, and management staff. (Id. ¶ ¶ 4, 9, 12, 13, 15, 17). The FDIC-R has also provided lists naming specific ESI sources.
FDIC-R describes five steps of production. First, it would turn over " roughly 86,000 pages" of " certain scanned documents," which are " targeted sets of documents not amenable to search terms," a stage it dubs " Phase I." (Docket No. 391-1 ¶ 6; Rivard Decl. ¶ 11) (emphasis added). Second, beginning " Phase II," FDIC-R would confer with defendants, " collectively," to " identify a reasonable set of search terms" across the DMS data set, including feedback statistics on positive matches. Third, once a set of search terms is fixed, FDIC-R will transfer matching data from DMS to Relativity. Fourth, D& Os will be allowed to access Relativity and select documents for final production. Fifth, FDIC-R will Bates-stamp, confidentiality-stamp, and export those documents from Relativity, completing " Phase II." The recipients of Phase II production would pay FDIC-R $0.06 per page.
The D& Os' process would begin with an initial production of documents FDIC-R identified in its initial disclosures. Next, the parties would confer and develop search terms to run against the searchable data, though FDIC-R would have to propose the first search terms. FDIC-R would provide both feedback statistics as well as sampled test productions. FDIC-R would then " perform a responsiveness review" on any documents subject to production. Should the parties agree on search terms, the universe of this review would be restricted to documents matching those search terms. In the absence of agreement, the FDIC would be required to review " all documents amenable to search terms." FDIC-R would also manually review and produce the non-searchable documents, either " in the exact order in which they are kept in the ordinary course of business," or labeled to match the requests to which they respond. No costs would be payable.
There is no material difference between the two proposals for the mechanical aspects of production, such as data formats and definitions of technical terms. Both parties suggested an express statement that backup media need not be recovered or searched. The two proposals contain similar language dealing with claw-back of inadvertent disclosures and requiring D& Os to privilege-log their own ESI. However, the D& Os would consult the court for every dispute. FDIC-R, for its part, would require " exercise of a reasonable standard of care" to invoke claw-back. Finally, the parties included similar language allowing them to omit materials disclosed pre-suit, though the D& Os add a requirement to identify those materials.
DISCUSSION
The parties' briefing discuss three broad points: (1) whether FDIC-R must organize and label its responses to production requests; (2) whether the cost of FDIC-R's ESI production should be shared by the D& Os; and (3) whether the D& Os should be required to submit consolidated interrogatories. Each of these are considered in turn, followed by a summary of the court's reasoning.
I. Organization and Screening
The D& Os argue that FDIC-R must " perform a responsiveness review," screening out irrelevant documents and labeling them to correspond to production requests; the FDIC-R counters that the " quick peek" framework it proposes is enough. When responding to a request for production, the responding party either " must produce documents as they are kept in the usual course of business or must organize and label them to correspond to the categories in the request." R. 34(b)(2)(E)(i). The " usual course of business" alternative is only available when by the documents' natural organization makes finding critical documents reasonably possible. See, e.g., FDIC v. Appleton, No. CV 11-476-JAK (PLAx), at *8 (C.D. Cal. Nov. 29, 2012) ( available at Docket No. 396-1); Pass & Seymour, Inc. v. Hubbell, Inc., 255 F.R.D. 331, 334 (N.D.N.Y. 2008); CooperVision, Inc. v. Ciba Vision Corp., No. 2: 06-CV-149, 2007 WL 2264848 at *4 (E.D. Tex. Aug. 6, 2007). For that reason, responding government agencies sometimes cannot rely on this modality; investigation documents often lack meaningful organization, in contrast to an agency's routine administrative records. See SEC v. Collins & Aikman Corp., 256 F.R.D. 403, 412-13 (S.D.N.Y. 2009) (1.7 million documents resulting from investigation and stored in " large disorderly databases" could not be produced without labeling).
At this time, the court does not have enough information to support ordering FDIC-R to conduct organize-and-label production. The D& Os cite cases where responding parties failed to organize their productions, but do not suggest any factual basis for concluding that data that will be produced in this case is similarly disorganized. On the other hand, FDIC-R should not suppose that it may simply provide unsorted piles of data for the D& Os to pore over. While Ray Rivard's declaration hints at how the data was preserved and indexed, there is no information that suggests the degree of organization that an actual production request will yield. In short, FDIC-R will not yet be required to label and organize its productions as a rule, but it may only avoid that burden to the extent its production satisfies the usual-course-of-business threshold. That could depend, for example, on whether critical organizational data (folder structures from network servers; physical sources of scanned documents) was preserved in the first place, as well as whether that organization is conveyed in the final production.
II. Cost-Shifting
FDIC-R seeks six cents per page for all ESI production beyond its initial disclosures. Yet " [f]or all discovery, including electronic discovery, the presumption is that parties must satisfy their own costs in replying to discovery requests." Dahl v. Bain Capital Partners, LLC, 655 F.Supp.2d 146, 148 (D. Mass. 2009) (citing Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 358, 98 S.Ct. 2380, 57 L.Ed.2d 253 (1978) and Zubulake v. UBS Warburg LLC, 216 F.R.D. 280, 283 ( Zubulake III ) (S.D.N.Y. 2003)). FDIC-R advances three rationales in support of its proposal: (1) ESI production costs are analogous to " copying costs" borne by the requestor; (2) the Westernbank ESI is " not reasonably accessible" under Rule 26(b)(2)(B); and (3) the seven-factor test applied in Zubulake III counsels cost-shifting here. I consider each point in turn.
A. ESI Production Costs as Copying Costs
FDIC-R argues it is entitled to demand an up-front contribution to its ESI production costs because (1) producing parties are not ordinarily burdened with the cost of making copies, and (2) ESI production costs are sometimes taxed under 28 U.S.C. § 1920 by analogy to its provision for copying costs. Both prongs of its syllogism are flawed. First, as the D& Os note, the fact that courts have taxed ESI expenses as costs awarded to prevailing parties at the end of a suit suggests they aren't routinely shifted before then. (See Docket No. 395 at 23). But more importantly, FDIC-R fails to explain how the costs it identifies--scanning and performing OCR, creating static images, Bates stamping, and privilege review--are outside the realm of gathering and preparation expenses customarily borne by responding parties. See also Bills v. Kennecott Corp., 108 F.R.D. 459, 462 (D. Utah 1985) (" Ordinarily, the producing party bears the costs of reviewing and gathering documents while the requesting party pays for the costs of the copies only." ). Perhaps at most, the supply and labor costs of making and delivering recordable CDs, DVDs, or analogous media could fairly be borne by the D& Os. Cf. Dahl, 655 F.Supp.2d at 149 (requesting parties " would need only pay to put the converted documents on DVDs . . . ." ). But FDIC-R offers no evidence of what this cost would be. Regardless, it is not entitled to generalized per-page cost-shifting on this ground.
B. " Not Reasonably Accessible"
FDIC-R alternatively contends that the Westernbank ESI is not reasonably accessible within the meaning of Rule 26(b)(2)(B), justifying cost-shifting as a protective measure. That rule provides that " [a] party need not provide discovery of electronically stored information from sources that the party identifies as not reasonably accessible because of undue burden or cost." The party resisting discovery has the initial burden of showing inaccessibility, after which the discovery proponent must establish " good cause" for requiring production. Id. In other words:
Rule 26(b)(2)(B) takes a categorical approach: it invites the classification of [ESI] as either " accessible" or " not reasonably accessible." While cost and burden are critical elements in determining accessibility, a showing of undue burden is not sufficient by itself to trigger a finding of inaccessibility. For example, the sheer volume of data may make its production expensive, but that alone does not bring it within the scope of Rule 26(b)(2)(B). Rather, the cost or burden must be associated with some technological feature that inhibits accessibility.
Chen-Oster v. Goldman, Sachs & Co., 285 F.R.D. 294, 301 (S.D.N.Y. 2012) (footnote omitted). See also W.E. Aubuchon Co. v. BeneFirst, LLC, 245 F.R.D. 38, 42-43 (D. Mass. 2007) (unindexed, unsearchable filing system was not reasonably accessible, and so irrational that it bordered on intentional obfuscation). Here, FDIC-R has not hinted at any technical problem hindering access to the data the D& Os would have it search. To the contrary, both Rivard's statement and FDIC-R's proposed protocol suggest that relevant ESI has already been loaded into a retrieval system (DMS) that is both searchable and organized into meaningful databases.
FDIC-R argues, superficially, that another decision from this district " recognized that high production costs are sufficient to render ESI 'not reasonably accessible'" under the rule. (Docket No. 391 at 13) (citing Rodrí guez-Torres v. Gov't Dev. Bank of P.R., 265 F.R.D. 40 (D.P.R. 2010)). The plaintiff there had alleged age and sex discrimination; among the failure-to-promote claims ultimately found timely by the court, the highest-paid position she sought had a $51,400 annual salary. See 704 F.Supp.2d 81, 91 (D.P.R. 2010) (opinion granting summary judgment for defendants). In its discovery order, the court held that an estimated $35,000 cost of production, exclusive of privilege review costs, was excessive " in this type of action." 265 F.R.D. at 44. But while the court cited Rule 26(b)(2)(B), its rationale did not address accessibility so much as proportionality, which is not relevant to Rule 26(b)(2)(B)'s purpose and function. Cf. Chen-Oster, 285 F.R.D. at 303 (court may block disproportionate requests even when ESI is reasonably accessible under Rule 26(b)(2)(B)). In short, I reject the contention that Rule 26(b)(2)(B)--and its shifting burden to justify production requests--kicks in any time that discovery implicates both (1) electronically stored information and (2) large volumes of data, even where the volume renders review costly.
Because FDIC-R has not shown that access to the Westernbank data is hindered by any unique technological hurdles, it has failed to trigger Rule 26(b)(2)(B). It is therefore not entitled to categorically label the DMS databases " not reasonably accessible."
C. The Zubulake Factors and Proportionality
FDIC-R argues that several of the " Zubulake factors" favor cost-shifting. The plaintiff in that case alleged that she suffered employment discrimination because of her gender, as well as retaliation. In discovery, she sought e-mails that were largely stored on archived backup tapes which were " only accessible through costly and time-consuming data retrieval." Zubulake III, 216 F.R.D. at 281. The court applied a seven-factor analysis to determine the extent to which the requesting plaintiff, rather than the responding defendant, should bear the cost of production:
1. The extent to which the request is specifically tailored to discover relevant information;
2. The availability of such information from other sources;
3. The total cost of production, compared to the amount in controversy;
4. The total cost of production, compared to the resources available to each party;
5. The relative ability of each party to control costs and its incentive to do so;
6. The importance of the issues at stake in the litigation; and
7. The relative benefits to the parties of obtaining the information.
216 F.R.D. at 284. Yet as the D& Os note, the court tailored these factors to allocate the cost of retrieving data that is not readily accessible--" '[t]he responding party should always bear the cost of reviewing and producing electronic data once it has been converted to an accessible form.'" (Docket No. 395 at 24) (quoting Zubulake III, 216 F.R.D. at 290-91). In light of the accessibility analysis discussed above, I am persuaded that the Zubulake analysis does not apply per se. Notwithstanding, the court is required, " [o]n motion or on its own," to: . . . limit the frequency or extent of discovery otherwise allowed by these rules or by local rule if it determines that:
(i) the discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive;
(ii) the party seeking discovery has had ample opportunity to obtain the information by discovery in the action; or
(iii) the burden or expense of the proposed discovery outweighs its likely benefit, considering the needs of the case, the amount in controversy, the parties' resources, the importance of the issues at stake in the action, and the importance of the discovery in resolving the issues.
R. 26(b)(2)(C). I would therefore focus on the proportionality considerations under this rule. But frankly, the parties' broad claims about their respective discovery proposals are too speculative to merit a ruling at this time. FDIC-R's affidavit describes the nature of the Westernbank data and itemizes some of the bulk costs, but does not shed any light on the effort in this case--particularly with respect to building responsive searches--that will be required to respond to particular requests. Likewise, it extols the policy virtues of its Relativity proposal, though it never articulates how using a contractor that charges $450 per gigabyte will reduce the net burden on FDIC-R. (See Docket No. 406 at 10). For their part, the D& Os point to two decisions where FDIC-R was ordered to provide discovery in a certain way. (Docket No. 395 at 19-22) (discussing Appleton and FDIC v. Klein, No. 1: 12-CV-0896-RLV (N.D.Ga. Dec. 13, 2012) ( available at Docket No. 395-1)). But the Appleton order came after discovery attempts showed that FDIC-R's response was entirely unworkable. And as FDIC-R notes, the Klein court did not fully explain the considerations persuading it to adopt the defense's ESI protocol; thus, that precedent does not weigh heavily in my consideration here.
In sum, this is less a situation where the scales are evenly balanced, and more one where the court has been given nothing to place on either side. Until the parties take affirmative steps to conduct discovery--perhaps after test runs, for instance--there is no ground for the court to dramatically alter the defaults under the Federal Rules of Civil Procedure. Cf. Zubulake v. UBS Warburg LLC, 217 F.R.D. 309, 324 ( Zubulake I ) (S.D.N.Y. 2003) (declining to issue a cost-shifting order for inaccessible media until a test run was conducted; " by requiring a sample restoration of backup tapes, the entire cost-shifting analysis can be grounded in fact rather than guesswork." ).
III. Consolidated Interrogatories
Unrelatedly, FDIC-R also seeks an order requiring the defendants' written discovery requests to be consolidated in light of the number of people it has sued. By default, Rule 33 permits each party to serve up to twenty-five written interrogatories. FDIC-R would have the defendants agree on fifteen questions in common, and leave each defendant with a bank of up to fifteen questions limited to " individual issues" facing each defendant. This, it argues, would spare it the burden of " responding to duplicative, overlapping requests on the same issues from each Defendant." (Docket No. 391 at 17).
At best, I find FDIC-R's request to be premature. As it is not complaining about any specific requests for interrogatories, its abstract argument about the burdens it will face are difficult to assess. Moreover, the default rule strikes a balance by correlating the potential number of interrogatories a party faces with the number of parties in the suit, which seems to be a reasonable proxy for the case's overall complexity. Gross abuses, such as those narrated in the cases FDIC-R cites, may justify tinkering with this balance, as could stipulations or partial settlements that narrow the scope of the case. Since there is no such demonstration here, I am not persuaded that the court should issue such an order at this time.
IV. Summary
To give the parties a roadmap, the court will issue an order reflecting the reasoning discussed above. In short, FDIC-R will neither be categorically required to organize and label its productions, nor permitted to produce documents without adequate organization. No cost-shifting is justified at this time, though trial runs showing disproportionate costs, or abusive discovery tactics, could warrant reconsideration.
Without explanation in their briefing, the D& Os would have FDIC-R propose initial search terms. But as former directors and officers of Westernbank, the D& Os are more likely to have an idea of what documents they are looking for in a particular request. Therefore, the court will require the requesting party to propose search terms first--though since FDIC-R oversaw the loading of ESI into DMS, it is expected to provide active assistance, and should anticipate consulting its technically-skilled staff or contractors as necessary.
In addition to specifying a protocol for negotiating searches, the order will explicitly require FDIC-R to produce and continue producing materials subject to its initial disclosure obligations. But because the parties' briefing only touched on the terms for producing FDIC-R's searchable data in the DMS system, the order will not address production by either (a) the other parties, or (b) any of FDIC-R's other sources of discoverable material, whether digital or physical. Those sources of production remain subject to discovery under the ordinary rules.
The parties' agreed technical procedures and vocabulary will be incorporated with only stylistic changes, along with their general claw-back language. However, the language duplicating Fed.R.Evid. 502 and Fed.R.Civ.P. 26(b)(5)(B) will be simplified. Finally, rather than endorsing the suggestion that the parties will bring all privilege questions to the court (see Docket No. 363-1, ¶ ¶ 13-15), language is added emphasizing the parties' obligation to meet and confer under the local rules.
CONCLUSION
For the foregoing reasons, FDIC-R's request for a change in the number of interrogatories is DENIED. A separate order will issue containing the court's ESI protocol.
IT IS SO ORDERED.
ORDER GOVERNING DISCOVERY OF ELECTRONICALLY STORED INFORMATION FROM FDIC-R
I. Preamble and Definitions
For the reasons stated in the accompanying opinion, the parties to this action are hereby ordered to comply with the following as a default protocol for obtaining certain electronically stored information (" ESI" ) from the Federal Deposit Insurance Corporation in its capacity as receiver of Westernbank Puerto Rico (" FDIC-R" ). FDIC-R and any other party may privately agree to alter these terms as permitted by Fed.R.Civ.P. 29(b). In the absence of agreement, however, this order will control until it is amended or vacated by the court.
The following terms are given special meanings:
Native File means ESI in the electronic format of the application in which such ESI is normally created, viewed, and/or modified. Native Files are a subset of ESI.
Metadata means (i) information embedded in a Native File that is not ordinarily viewable or printable from the application that generated, edited, or modified such Native File; and (ii) information generated automatically by the operation of a computer or other information technology system when a Native File is created, modified, transmitted, deleted, or otherwise manipulated by a user of such system. Metadata is a subset of ESI.
Static Image means a representation of ESI produced by converting a Native File into a standard image format capable of being viewed and printed on standard computer systems. In the absence of agreement of the Parties or order of Court, a Static Image should be provided in Tagged Image File Format (TIFF, or .TIF files). If a TIFF or .TIF file cannot be created, then the Static Image should be provided in Portable Document Format (PDF). If Load Files were created in the process of converting Native Files to Static Images, or if Load Files may be created without undue burden or cost, Load Files shall be provided as set forth in Part III.D.
Load File means the file necessary to load data into a reviewable database. A load file can, for example, specify what individual pages belong together as a document, what attachments are included with a document, where a document begins and ends, and what metadata is associated with a document.
DMS Data means ESI in the following " DMS iConnect" databases identified by FDIC-R:
WT ADP PC Payroll Employee Master 44 WT AFS ImageVision Additional Images (Checks/Returns/Lockbox) 55
WT AFS ImageVision Check Images 46_1
WT AFS ImageVision Check Images 46_2
WT AFS Return and Lockbox Check Images 54
WT Data Select CLCS Customer Master 15
WT Data Select CLCS Loan Master 16
WT Data Select CLCS Loan Participation Master 17
WT Data Select CLCS Loan Transaction History 18
WT Email Database
WT Email Database 2
WT Fiserv Signature Customer Master 1
WT Fiserv Signature Deposit Master 6
WT Fiserv Signature Deposit Master Additional Details 7
WT Fiserv Signature Deposit Transaction History 8_1
WT Fiserv Signature Deposit Transaction History 8_2
WT Fiserv Signature GL Master 13
WT Fiserv Signature GL Transaction History 14
WT Fiserv Signature Loan Collateral 5
WT Fiserv Signature Loan Master 2
WT Fiserv Signature Loan Master Additional 52
WT Fiserv Signature Loan Part Tran History 53
WT Fiserv Signature Loan Participation 3
WT Fiserv Signature Loan Transaction History 4
WT Fiserv Signature Safety Deposit Box Master 11
WT Fiserv Signature Safety Deposit Box Transaction History 12
WT Fiserv Signature Time Deposit Master 9
WT Fiserv Signature Time Deposit Transaction History 10
WT Forensic Data 2
WT Forensic Data Email
WT Forensic File Inventories
WT GFI MailArchiver Email
WT GFI MailArchiver Email Part2
WT INQ MortgageWare Loan Applications 19
WT INQ MortgageWare Loan Applications Custom Fields 1 20
WT INQ MortgageWare Loan Applications Custom Fields 2 21
WT Investigations Master Inventory
WT Metavante Metaviewer Reports Deposit Loan Wires others 45
WT Microsoft Access AP Transaction History 38
WT Microsoft Access AP Vendor Master 37
WT Microsoft File Shares and Miscellaneous Documents 51
WT Scanned Documents
WT Scanned Documents 2
WT TPG Derivative Genius CUSIP Buckets 42
WT TPG Derivative Genius General Ledger 43
WT TPG Derivative Genius Investment Portfolio 39
WT TPG Derivative Genius Investment Positions 41
WT TPG Derivative Genius Investor Instruments 40
WT TSC Trust Account Management 31
WT TSC Trust Account Plan Amendments 35
WT TSC Trust Account Plan Master 30
WT TSC Trust Account Plan Status 33
WT TSC Trust Account Withdrawal Transactions 34
WT TSC Trust Financial Reports (AP others) 36
WT TSC Trustee Payouts 32
WT T-Sys DXR Reports Statements Charge-offs others 50
WT William Stuckey NT-ABL Asset Customer Credit Lines 23
WT William Stuckey NT-ABL Asset Customer Master 22
WT William Stuckey NT-ABL Asset Loan Daily Status 28
WT William Stuckey NT-ABL Asset Loan Interest Rates 25
WT William Stuckey NT-ABL Asset Loan Limits 26
WT William Stuckey NT-ABL Asset Loan Master 24
WT William Stuckey NT-ABL Asset Loan Reduction Schedule 27
WT William Stuckey NT-ABL Asset Loan Transaction History 29
(See Docket No. 391-1, p. 12-13).
Westernbank/Inyx Data means the Inyx bankruptcy ESI identified by FDIC-R from the following sources and with the following Bates codes:
Bates Code
Description
AOL0000
Barry Woods' (counsel for Westernbank) AOLaccount emails
AUDIT
BAW000000
Barry Woods, counsel for Westernbank
BERK00000000
Berkowitz & Lago CPA, Inyx's public auditor
Deloitte
Deloitte & Touche, Westernbank's auditor
EFILE
4,537 Documents from dataroom used for ProjectMichael
research
E& Y
Ernst & Young, Westernbank's auditor
GREEN_PR
INYX_WB
Inyx hardcopy and electronic production
INYX_WB0000000
E& Y UK Supplemental Production 1/14/08 of InyxDocuments
JR
Joseph Rose, former corporate accountant for Inyx
KACH
Jack Kachkar, CEO and Chairman of Inyx
LAURUS-INYX
W000
Weinberg & Company, Accountants for Jack Kachkar inMiami
WBEM00000000
Westernbank Electronic Production
WBPR00000000
Westernbank hard copy and electronic production
ZINN_00000
David Zinn, CFO for Westernbank located in Miami
(See Docket No. 391-1, p. 14).
II. Initial Disclosures and Requests for Production
Absent contrary agreement, FDIC-R must produce the documents identified in its Rule 26 initial disclosures, as well as the Westernbank/Inyx Data, in the way specified in part III. To the extent FDIC-R is obligated to supplement its initial disclosures, it is likewise obligated to supplement production under this part.
To obtain production from searchable DMS Data, the requestor must propose initial parameters for a query, such as search terms, databases, and fields of metadata to be searched. FDIC-R and the requestor must reasonably cooperate to reach an agreement on a query that will satisfy the request. FDIC-R's cooperation must include, but is not limited to, offering hit reports and suggesting alternative queries that better meet the request. The requestor's cooperation must include, but is not limited to, identifying specific complaints about queries and suggesting alternatives. FDIC-R will then produce all non-privileged data resulting from the agreed-upon query, subject to the terms in the following sections.
Requests for production of any other data--including non-searchable DMS Data, physical documents, and other sources of ESI--are not governed by this part.
III. Production Method
A. Form of Production for Email
All electronic email from Windows-Based ESI (" WESI" ) shall be produced as Static Images complete with full text extracts and the following fields of metadata, to the extent the metadata is available:
1. Custodian (Name of Custodian from which file is being produced);
2. Other Custodians (Name(s) of custodian(s) who had exact copy of message before de-duplication);
3. Author (FROM field);
4. CC;
5. BCC;
6. Recipient (TO field);
7. MD5 Hash Value or Equivalent;
8. Date Sent (Date the email was sent);
9. Date Received (Date the file was received);
10. Time Sent (Time the email was received);
11. Time Received (Time the email was received);
12. File Type (Application used to create the file);
13. Page Count;
14. File Ext (Extension for the file);
15. PST Name;
16. Body Text (Extracted text);
17. Bates Begin (Beginning Production Number);
18. Bates End (Ending Production Number);
19. Attach Begin (Beginning Attachment Range Number);
20. Attach End (Ending Attachment Range Number).
Electronic mail shall be produced along with attachments to the extent the message and/or any attachment is responsive, relevant and not privileged. As a general matter, subject to specific review, a message and its attachments(s) shall not be withheld from production based on the fact that one or more attachments are privileged, irrelevant or non-responsive. To the extent the message and/or one or more attachments is privileged or non-responsive, the responsive, non-privileged documents shall be produced along with placeholders indicating whether the individual record was withheld as non-responsive or privileged.
B. Form of Production for Other WESI
All other WESI (including attachments to electronic mail) shall be produced as Static Images complete with full text extracts and the following fields of metadata, to the extent the metadata is available:
1. Custodian (Name of Custodian from which file is being produced);
2. Other Custodians (Name(s) of custodian(s) who had exact copy of file before de-duplication);
3. Author;
4. Doc Title (Title of file from properties);
5. Doc Subject (Subject of file from properties);
6. Created Date (Date the file was created);
7. Created Time (Time the file was created);
8. Last Modified Date (Date the file was last modified);
9. Last Modified Time (Time the file was last modified);
10. Last Saved By (Name of user who last saved the file);
11. File Type (Application used to create the file);
12. Doc Type;
13. Page Count;
14. File Ext (Extension for the file);
15. Path (Full path of the original location where the file was located);
16. MD5 Hash (MD5 hash value of the original native file);
17. Body Text (OCR for paper data or Extracted text for all ESI);
18. Bates Begin (Beginning Production Number);
19. Bates End (Ending Production Number);
20. Attach Begin (Beginning Attachment Range Number);
21. Attach End (Ending Attachment Range Number).
C. Form of Production for Spreadsheets
ESI in the form of spreadsheets shall be produced in native format. There will be a static image placeholder within the final Bates-numbered set, stating that the document will be produced natively. The file name of the placeholder will be changed to reflect the static image's Bates number for cross-reference purposes. These documents will be accompanied with the appropriate load files indicating a cross reference to the Bates numbered Static Image.
D. Load Files
All WESI shall be produced along with an IPRO, Opticon, or Summation DII load file indicating Bates numbers and document breaks. Metadata shall be produced in Concordance DAT file format, DII format and summary text file for Summation, or XML format and extracted full text shall be provided in TXT file format at the document level. Non-Windows-Based Applications and Data shall be subject to the same production requirements to the extent technically and legally feasible.
E. Data Culling
The following file types shall be processed for production:
Extension
File Type Description
cab
Windows cabinet (data will be extracted and containerfile discarded)
csv
Comma Separated Values file
dat
Data file
dbx
Outlook Express E-mail Folder
doc
Microsoft Word
docx
Microsoft Word 2007
doom
Microsoft Word Template
dxl
Lotus Notes Message File
efax
Electronic fax documents
Outlook Express E-mail Message
eml
Outlook Express Saved Mail Messages files
emlx
Apple Mail email message
htm
Web based Hypertext Markup Language File
html
Web based Hypertext Markup Language File
ics
Calendar items in Apple, Mozilla and Google
key
Apple Keynote presentation
maildb
MSN Mail file
mbox
Unix MAC file mailbox
mdb
Microsoft Access Database
mht
Multipurpose Internet Mail Extension
mim
Multipurpose Internet Mail Extension
mlm
Novell GroupWise saved email message file
mpp
Microsoft Project
msg
Outlook Mail Message
nsf
Lotus Notes (data will be extracted and containerfile discarded)
ost
Microsoft Outlook Offline folder file (data will beconverted, extracted, and
container file discarded)
pbx
Outlook Express message folder file
Portable Document Format File
pop
PopMail messages file
pps
Microsoft PowerPoint Show file
ppt
Microsoft PowerPoint file
pptx
Microsoft PowerPoint 2007
pst
Microsoft Outlook personal folder file (data will beextracted and container file
discarded)
rar
WinRAR compressed archive (data will be extracted andcontainer file discarded)
rtf
Rich Text Format
tif
Tagged Image Format
F. Duplicates
To avoid the production of more than one copy of a particular unique item, the Parties shall use industry standard MD5 or SHA-1 hash values within (1) all emails identified for production, and (2) all loose files identified for production. The Parties will not de-duplicate attachments to emails against loose files.
G. Other Methods to Streamline Discovery
The Parties shall meet and confer in good faith about any other technology or process that a producing party proposes to use to streamline the culling, review and production of ESI (e.g., email threading, near de-duplication, technology assisted review). The Parties shall make reasonable good faith efforts to resolve any objections to the use of such technology or process before seeking relief from the court.
H. Production Media
Documents shall be produced on external hard drives or readily accessible computer or electronic media, e.g., CDs or DVDs, or by FTP upload (" Production Media" ). All Production Media should have the following four directories: (1) IMAGES for the images; (2) DATA for the .dat and .opt files; (3) TEXT for the extracted text/OCR files; and (4) NATIVES for the native Excel files. The Production Media shall identify: (a) the producing party's name; (b) the production date; and (c) the Bates Number range of the materials contained on the Production Media.
I. Color
Where the original of a produced document is in color, and color is material to the interpretation of the document, the receiving party may request that the document be produced in color (whether electronic or paper).
J. Physical Documents
Documents that exist solely in physical hard-copy format shall be converted and produced following the same protocols outlined above. The metadata shall indicate document breaks and identify the custodian from whom the document was collected. The " .tiff" files shall be subject to an Optical Character Recognition (" OCR" ) process.
K. Inaccessible Data
The Parties need not collect documents stored on disaster recovery backup tapes unless a showing of specific need is made.
IV. Labeling
To the extent that the production reasonably preserves the organization by which Westernbank's documents were " kept in the usual course of business," FDIC-R may furnish production without further review or labeling. Otherwise, FDIC-R must organize and label its production to correspond to the categories in the request. See Fed.R.Civ.P. 34(b)(2)(E)(i).
V. Claw-Back
Producing any ESI or documents for inspection shall be without prejudice to any claim that said ESI or documents are protected by the attorney-client privilege, work product doctrine, or any other applicable privilege or basis for withholding production. Upon demand, the receiving party shall return any such inadvertently produced ESI or documents subject to a privilege claim, including all copies thereof, to the producing party. To the extent that the parties disagree over the application of these principles to any such production or challenge the privileged nature of such material, the receiving party shall not make use of the material in question until the matter is resolved by the Court.
This order does not reduce the claw-back protections afforded by any other rule, such as Fed.R.Evid. 502 or Fed R. Civ. P. 26(b)(5)(B).
VI. Conclusion
This order does not alter the obligation under Local Rule 26(b) to make a " reasonable and good faith effort to reach an agreement" before bringing discovery disputes to the court. Moreover, the parties and their attorneys can expect stiff monetary and other sanctions to be imposed against the losing party in any discovery-related motions. See Fed.R.Civ.P. 37.
IT IS SO ORDERED.