Magazine article Information Management

The End of the Ostrich Defense

Magazine article Information Management

The End of the Ostrich Defense

Article excerpt

While it did not set any new precedents or change the world, Zubulake v UBS Warburg signals a big shift - rational analysis is at least entering the realm of electronic records and the courts

The information management world has been much abuzz of late over a series of interlocutory orders in the case of Zubulake v. UBS Warburg.

Since the filing of the case in 2002, federal judge Shira Scheindlin of the Southern District of New York has issued five opinions and orders, gaining her a reputation as the scourge of sloppy electronic records management. Scheindlin's July 20, 2004, order (Zubulake V) imposed hefty sanctions on the defendant, including the much-feared sanction of an adverse inference and an accompanying jury instruction, meaning the jury was told it could infer that the defendant destroyed potentially relevant evidence because the company feared the evidence would be unfavorable.

Zubulake continues to be an instructive case for those interested in the legal system's attempts to deal with records management issues in general and electronic records management issues in particular. In prior orders, Scheindlin considered the question of costs and difficulties of electronic discovery and the proper allocation of the costs between the parties. In so doing, she developed a test for determining the appropriateness of cost-shifting, taking into account prior authority such as the Rules of Civil Procedure and prior case doctrine, and ordered data sampling to be done in order to determine the potential relevance of e-mails located on backup tapes (Zubulake I). In a later order (Zubulake III), she applied that test and allocated costs for restoring backup tapes based upon the results of the data sampling done pursuant to her prior order. In the current phase of the case (as of the end of 2004), Scheindlin has had occasion to examine and rule upon the results of her earlier orders.

The Significance of the Case

Zubulake is not itself a particularly noteworthy or groundbreaking case. As noted by the judge herself, it is a routine gender discrimination suit involving no novel facts or questions of law. Nor are the discovery issues that have presented themselves novel; the discovery under dispute is routine discovery of e-mail on active servers, archives, and backup tapes, an issue likely to be familiar to most records and information managers, many of whom have had to undertake similar discovery at their own organizations. What is novel and instructive is the court's handling of the issues presented during the dispute and fact-finding process.

Subsequent to Zubulake III, the parties restored the backup tapes in question, and e-mail from them was recovered and given to the plaintiffs. During the restoration process, it was determined that some backup tapes had been destroyed or otherwise rendered unrecoverable. Although at least some of the e-mail contained on those tapes was still available from other tapes due to the redundant nature of the backup process, Zubulake contended that critical e-mail might be permanently unavailable.

Analysis revealed that some e-mails had been deleted from the active system after a duty to preserve them was attached. In some cases, this apparently resulted from miscommunication between counsel and UBS Warburg employees, but in other cases, no explanation of the destruction was offered. Zubulake claimed that this amounted to spoliation of evidence. She therefore sought a variety of sanctions, including restoration at the defendant's cost of still more backup tapes, re-deposition of certain key witnesses at the defendant's expense, and an adverse inference instruction from the court.

In an order dated October 22, 2003 (Zubulake IV), the court discussed at length several questions of interest:

When does the duty to preserve evidence attach? Since some of the missing e-mail apparently pre-dated the filing of the Equal Employment Opportunity Commission (EEOC) complaint at the center of the case, the court considered the time at which the duty to preserve the e-mail attached. …

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