Electronically Stored Information

It is not uncommon, in the litigation of a federal construction claim, for the Government to produce gigabytes of electronic data, amounting to thousands and thousands of documents, in response to a motion for the production of documents.  Frequently, these “electronic” documents are simply the scanned versions of paper files in the Government’s offices.  In the scanning process, extensive duplication occurs and documents that are clearly separate in paper file folders are scanned together in a manner that often combines multiple documents.  Once combining occurs, it is very difficult for the recipient of the electronic information to tell where one document ends and the next one begins.  Documents and their attachments become confused, are re-arranged, and difficult to follow.  Continue Reading E-Discovery- Bring Back the Boxes

There is no question that documentation is an important part in the resolution of any construction dispute. Particularly contemporaneous documents – documents that are created at the time that events occur. Quality control reports, daily logs, and timely letters all fall into the “contemporaneous” category. Another type, however, has an instantaneous characteristic that not only makes it contemporaneous, but so current as to be potentially dangerous – e-mail. This form of documentation cannot only be useful to record events virtually as soon as they occur, but it also has become a vehicle for the expression of emotions without the benefit of reflection.

Sending sms

Every contractor, for example, has had the occasion to be angered by something that another contractor, vendor, or owner has done during the performance of a construction project. If the subject of that anger, or disagreement, could lead to a request for additional compensation, there is often a knee-jerk reaction to put something in writing. Many of us have hurriedly drafted a letter and then, feeling better for having written it, crumpled the paper and tossed it into the nearest wastebasket. It has a therapeutic value and no harm is done. In our Information Age, however, with the ability to compose e-mail messages on our computers, iPads, and smartphones, the opportunity for reflection is gone as soon as we hit the “Send” button.

As an attorney, this often creates a serious problem when those messages are sent by a prime contractor to a sub, or by a sub to the prime. What both parties seem to fail to recognize is that these instantaneously transmitted messages not only record past events and express current thoughts, they may also have a dramatic effect on the future outcome of a dispute. What happens when the prime accuses the sub of poor workmanship and later seeks to blame the owner for providing a defective specification that actually caused the problem? That e-mail message, sent hastily to the subcontractor before all the facts were known, may become a useful document to the owner during litigation. The question, on cross-examination, will be “Isn’t is true that you believed that the problem was poor workmanship by your subcontractor, and not any defect in the specifications?” If the problem really is a defective specification, the ill-advised e-mail message has provided a potential defense to the owner and has introduced uncertainty into the dispute where none may have otherwise existed.

The lesson in all of this is that all parties should think about the possible consequences of the emotions and feelings they are expressing. There is no question that the facts, such as the working conditions, equipment, and manpower at the site must be recorded promptly and accurately. If the accurate recording of events affects the outcome of a dispute, it probably means that justice has been done. Expressions of emotions and opinions that are not well thought-out are in a different category, however and, when conveyed in e-mail messages, they are an unwelcome byproduct of the Information Age. E-mail messages, and all forms of Electronically Stored Information (“ESI”), are just as discoverable by the other side as paper documents. My advice is to be careful and think about the possible future impact of writing, and instantaneously transmitting, things that do not need to be said. Not every form of contemporaneous documentation is a good idea.

Michael H. Payne is the Chairman of the firm’s Federal Practice Group and, together with other experienced members of the group, frequently advises contractors on federal contracting matters including bid protests, claims and appeals, procurement issues, small business issues, and dispute resolution.

On December 1, 2006, amendments to the Federal Rules of Civil Procedure became effective and made something that had already been established by court decisions very clear – that virtually every kind of electronically stored information (“ESI”) is discoverable in litigation.  Government construction contractors, and their attorneys, need to be concerned about the preservation and disclosure of electronic information, including e-mail messages, voicemail messages, and any kind of a file stored on a computer.  Unfortunately, as the information age makes an exponentially greater volume of information available, the seemingly easy storage of that information may actually be creating a vast minefield for the unwary.

Contractors need to be aware that even computer files that have been intentionally or inadvertently deleted are potentially discoverable.  (Simply because data has been “deleted” from a hard drive does not necessarily mean that it cannot be retrieved).  Courts may no longer accept the excuse that “the files were erased” if there was an obligation to preserve the data, or if the company failed to have an established ESI retention policy to assure the reasonable retention of electronic information.  The new rules provide guidance and clarification on a number of topics related to electronic discovery (e-discovery), including the discoverability of data that is difficult to access, such as back-up tapes, the form in which electronically stored information should be produced, and how to deal with the inadvertent production of privileged information when large amounts of electronic data are produced.

One of the difficulties with the production of electronic data is that it is often harder to review than paper documentation because it involves the examination of large amounts of data stored on CDs, DVDs, floppy disks, hard drives, backup tapes, network servers, Internet backup services, and other storage devices.  A company often finds it to be an overwhelming task to gather the data, and an equally daunting and costly task to electronically produce it.  Electronic information on a complex matter involving technical data can occupy hundreds or even thousands of CDs (we are currently involved in exactly such a case). 

It is important to recognize that the content of electronic information can be very different, and far less formal, than paper documentation.  We have noticed that there is often a tendency to be careless when writing an e-mail message because of the informality, as compared to a letter.  Contractor personnel are frequently very candid in e-mail messages and they may make off-the-cuff remarks that give the other side “ammunition” to discredit the contractor’s position.   In addition, electronic information often contains “metadata” (underlying data that states when a document was created, modified, accessed, etc.).  Without realizing it, or intending to do so, an electronic file may provide much more information than the author or the company ever intended, or was required, to preserve and that information may be a goldmine for the other side in litigation.

Continue Reading Important New Rules on Electronically Stored Information