What eDiscovery Requests are “Too Burdensome” Under 26(b)(1)?
By
Sierra M. Palmer, Law Clerk
Schwartz Semerdjian Cauley & Moot LLP
Published: 06.01.2018
If there were one word used to describe the eDiscovery collection process, it would not be “concise.” With documents being managed and saved online, there are sometimes millions of pages of documents requested at a time, which can seem excessive and burdensome if you are not the requesting party. However, discovery requests of an unreasonable magnitude are limited under FRCP 26(b)(1), which states as follows:
Unless otherwise limited by court order, the scope of discovery is as follows: Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit. Information within this scope of discovery need not be admissible in evidence to be discoverable.
But what does this rule really mean? Terms like “the importance of the discovery,” or “considering the importance of the issues,” give plenty of room for speculation. However, courts seem to be working on filling in those holes. Most recently in September 2017, the District Court for the District of Columbia emphasized in Oxbow Carbon & Minerals LLC v. Union Pac. R.R., 2017 U.S. Dist. LEXIS 146211 the proportionality factors of FRCP 26(b)(1) when determining whether or not to grant a motion to compel discovery documents.
In this recent anti-trust case, Plaintiffs were comprised of five companies that mine and sell coal and petroleum coke (collectively “Oxbow”). Id. at 4. Oxbow claimed that it paid Defendant railroad companies who were contracted to ship their product more than $50,000,000 in illegal fuel surcharges as a result of a conspiracy to engage in anticompetitive conduct. Id. Oxbow therefore sought recovery of treble damages under 15 U.S.C §15 in addition to the lost business and profits that proximately resulted from the price-fixing conspiracy. Id.
As part of their motion, defendants requested that the court compel Oxbow to add Oxbow’s CEO, William Koch (“Koch”), to the list of document custodians whose records would be searched for responses to their discovery requests. Id. Defendants contended that the CEO possessed relevant and unique information responsive to their requests, but Oxbow refused to add him to the list based on the theory that the production of his documents would be “disproportionately burdensome.” Id. Defendants then asserted that their discovery request was “proportionate and reasonable in light of the facts of this case, including the tens of millions of dollars that Oxbow seeks in damages.” Id.
Oxbow contended in its opposition that defendants failed to satisfy their burden of demonstrating that the discovery they seek is responsive and not unduly burdensome, noting that adding Koch as a document custodian would add 130 gigabytes of documents to discovery, adding an approximate $250,000 to Oxbow’s discovery cots. Id. at 5. Even so, Oxbow reasoned that it was willing to analyze a random sample of Koch’s records using agreed-upon search terms to determine the responsiveness of the documents to their discovery requests. Id. Upon a sample analysis of 467,614 documents in Koch’s file, only 45,639 were deemed a “hit” on the agreed-upon search terms. Id. at 7.
During their August 2, 2017, status report with the court, the parties disagreed about the significance of the sampling results, with Oxbow believing that the results confirmed a low responsiveness and defendants viewing the results of the sampling as proof of relevant and unique documents in Koch's records. Id. Defendants further argued the Oxbow refused to provide them with the data from the sampling that was necessary to evaluate the terms’ effectiveness and noted that Oxbow also refused to negotiate on the agreed-upon search terms. Id. at 8. Oxbow reasserted its contention that producing these documents would be unduly burdensome in violation of the proportionality requirement of FRCP 26(b)(1), and pleaded that the court either deny Defendants’ motion to compel or require them to bear the cost of production of the documents they sought. Id. at 7.
The court ultimately determined that it was unpersuaded by Oxbow’s argument, stating that, besides addressing the “unduly burdensome” factor of Rule 26(b)(1), Oxbow fails to mention any other proportionality factors that make up the rule. Id. at 12. The importance of the issues at stake, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, and the importance of the discovery in resolving issues in the case were all proportionality factors that Oxbow did not address, but instead further stressed the burden and costs of complying with Defendants’ request. Id. at 13.
The court then went through each proportionality factor, being careful to highlight important intricacies in each factor that the court must mind when determining whether or not to compel the production of documents. Id.
In weighing the importance of the first factor, issues at stake, the court should closely examine the “public policy spheres” of the case, such as freedom of speech, employment factors, and other matters. Through this lens, the court noted that personal and public values of the case may have importance beyond the monetary amount involved, which should be an important consideration. Id. at 14.
The second factor, the amount in controversy analysis, featured a ratio of the amount Oxbow has asked for in damages as it relates to the amount it costs to produce the documents—the larger the ratio difference, the more this factor weighs in favor of production. Id. at 15.
In determining the third factor, the weight of relevant access to information, the court looked to an “informational asymmetry” between the parties—namely whether one party has very little discoverable information in comparison to the other party’s vast amount of discoverable information. The court states that the burden always lies heavier on the party who has more information. Id. at 16.
Upon looking at the fourth factor, the parties’ resources, the court made it clear that, although one party is not permitted to “wage a war of attrition” to coerce a party, the question is quite simply asked, “Can they afford to pay?” Id. at 17.
The fifth factor, importance of discovery in resolving the issue, caused the court to ask the question, “Is the issue at stake at the heart of the litigation?” Phrased differently, the court determines whether the discovery request goes to the central issue in controversy or a side issue. Id.
The final factor, Oxbow’s only raised argument, was whether the burden or expense of the proposed discovery outweighs its likely benefit. In analyzing this factor, the court touches on analyses in the above factors to compare the total approximate cost of reviewing and producing the responsive documents in comparison to the amount that the case is potentially worth and how much has already been spent during discovery. Id. at 17-18.
Upon a thorough analysis of the above proportionality factors as they apply to the current case, the court highlighted that no one factor is to be given more weight in the analysis than any other. Id. at 10. After rounding out the underlying themes embodied in the factors, the court concluded the following: That Oxbow made serious allegations against Defendants that had the potential to impact many people, the amount in controversy was immense, Oxbow had more access to the information in question, Oxbow had spent and has the funding to continue to spend resources on discovery efforts, Oxbow’s CEO was of fundamental importance when it came to the resolving the issues of this case, and the expense imposed was not outrageous in comparison to the amount at stake in this case. As a result, the court granted Defendants’ motion to compel the discovery documents under Rule 26(b)(1). Id. at 13-21.
In January 2018, Breiterman v. United States Capitol Police, 2018 U.S. Dist. LEXIS 6539, cited Oxbow in their discovery dispute opinion regarding a gender discrimination case. By utilizing the above proportionality factors of Rule 26(b)(1), the court denied a motion to compel further discovery to a plaintiff. Id. at *11. This denial was due to not only the disproportionality of the request, but also her failure to carry her burden of establishing relevance of the information requested in her interrogatory. Id. at *20. The court further stated that plaintiff could have obtained the requested information through less burdensome means than additional interrogatories. Id. at *22. Ultimately, the court made clear that while Rule 26 allows for broad discovery, this does not equate to limitless discovery or a fishing expedition to prove the requesting party’s case. Id. at *15.
Although complying with Defendants’ discovery request for Oxbow’s CEO records in the pre-eDiscovery era would have neared impossible, technological advances have both allowed us and required us to be more inclusive and thorough in discovery responses. How much more inclusive still remains a point of contention in litigation, but cases like Oxbow have begun to flesh out the bare bones of Rule 26(b)(1) to provide a road map on what production is “too burdensome” and what production we will be held responsible for in the future.