A Good Decision Brings Out the Bullies

http://ow.ly/7sEB9

A blog post by Craig Ball, Esq. on his blog, Ball in Your Court.

The article discusses the recent ruling in the case  Pippins v. KPMG, in which KPMG was subject to a substantial preservation obligation based on the court's ruling.

The article defends the judge's decision, which has come under attack as lacking in proportionality and extending too costly of a preservation obligation on KPMG. The author writes, "Before class certification, KPMG elected to amass 2,500 hard drives from computers used by members of the putative class. No one ordered KPMG to do so. It was KPMG’s decision, and probably a sound one. Neither was KPMG ordered to preserve relevant material by preserving the entire contents of the hard drives. They could have made a defensible choice to preserve just the relevant contents and toss the drives. Again, holding the data as complete hard drives was a cautious and cost-effective choice, but it was KPMG’s choice, not something foisted upon them."

The article further states, "What KPMG wants is the court to anticipatorily shield it from a claim of spoliation should it later turn out that the drives KPMG discarded held relevant, material and non-duplicative information. Courts aren’t in the habit of giving such rulings, but Federal Rule of Civil Procedure 26(c) affords courts broad discretion to issue protective orders “for good cause … to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense.” As movant, KPMG bore the burden of proving its need for protection."  In addition, the author explains that there might be better sources of relevant information in this matter, but that is difficult to say unless there is a way to analyze the content from all of the available sources.

The article further explains that part of the judge's decision deal with KPMG's inability or unwillingness to provide any information about the contents of the materials on the hard drives.  The article states,"Judge Cott did what smart, fair judges do. He preserved the status quo and sent the parties away with guidance that will either enable them to work it out or assist KPMG in returning with sufficient evidence to allow the judge to weigh the relief sought.

As Judge Cott succinctly put it: “[A]t this point it is not entirely clear what the hard drives contain, in part because of KPMG’s own efforts to keep that information at bay…. Additionally, KPMG’s ongoing burden is self-inflicted to a large extent. It is suffering from the effects of its own reluctance to work with Plaintiffs to generate a reasonable sample that may well be less burdensome to maintain.” (slip opinion at p. 11)."