An increasing amount of an organization’s information is recorded electronically. Electronically stored data is as important as any other form of information to assessing, pursuing, or defending employment claims. There are, however, some unique legal issues that arise due to the specific nature of electronic data. In an effort to manage the production and use of such data, the federal rules governing civil proceedings have recently been modified. It is likely that state rules around the country will soon be modified to reflect the federal changes.
In order to implement the newly amended rules, it is critical that organizations understand their data management practices and review or institute certain controls. The process is complicated and time-consuming, so the time to begin preparing is now, before the inevitable need actually arises.
When it appears that a dispute may wind up before an arbitrator or judge, it will be important that all relevant data is preserved. It will become common for parties to send and receive letters similar to the following edited excerpt from the standard letter that I send:
Please take affirmative steps to preserve without alteration all records and tangible things of whatever type and form that are in the possession, custody, or control of you or an agent and that relate in any manner to any of the following: [the allegations, claims, and defenses of all parties; the statements made by witnesses; relevant conduct of parties or witnesses; previous allegations of a substantially similar nature regardless of who made them or when they were made]. The records and things to preserve include without limitation analog recordings of images, sounds, or other data; digital recordings of images, sounds, or other data; notes, reports, letters, drafts, e-mail, and memoranda; database components, including tables, indices, memos, and queries; electronically created or stored files; electronically created or stored backup files and electronically created or stored backup fragments; all logs related to all such documents; and all other material that is likely to be within the scope of [federal and state rules allowing liberal discovery of documents and things that may lead to relevant information, even if the initially discovered documents and things are not themselves relevant to the matter] regardless of whether the material is available from more easily accessible sources. The preserved material should be maintained in its native format as well as in all currently existing usable formats. PLEASE BE AWARE THAT, IN VIEW OF THIS HOLD LETTER, NO INFORMATION THAT IS SUBSEQUENTLY DELETED, LOST, OVERWRITTEN, OR OTHERWISE ALTERED AS A RESULT OF THE OPERATION OF YOUR INFORMATION SYSTEMS OR DATA RETENTION POLICIES WILL BE CONSIDERED TO HAVE BEEN COMPROMISED IN GOOD FAITH.
In order to manage the information necessary to promote your organization’s own interests while also complying with the type of “hold letter” quoted above, I recommend that you take the following steps:
- Assemble your information systems managers. Include outside consultants if you do not have the human resources in house. Managers of other functional divisions will also need to be part of the process.
- Determine what types of data your organization creates.
- Determine where all information resides, including old paper and old electronic data.
- Determine what types of backup operations are in place or contemplated, and where the backup data is located. Note whether the backup data are complete or fragmentary, i.e., incremental.
- Determine what your actual information retention policies are. Then determine what you want them to be. (Note that overwriting an existing file with new or adjusted information is generally equivalent to destroying the previous version.)
- Document and control:
– Where and how information is recorded;
– Where, how, and for how long information is stored;
– When, how, and what information is destroyed.
- Determine now what procedures will be necessary for the following:
– To produce data on any particular topic
– To discontinue normal overwrite and destruction procedures
- Maintain the ability to extract information from your data, which will mean either:
– Preserving hardware and software capable of reading various types of files in their native format, or
– Converting electronic data to a commonly accessible format other than its native format as part of the archiving process.
- Ensure that all affected persons are aware of the policies and procedures.
The question is not whether undertaking this process will be helpful, but how soon it will prove itself to be helpful. The need sooner or later for an organization to control its electronic data in order to comply with the new rules of litigation is inevitable. Taking these steps now, and ensuring that the policies and procedures are implemented throughout the organization, will make a substantial difference in the cost and effectiveness of pursuing and defending legal claims in the future.