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eDiscovery Update: The road to sanctions is paved with good intentions

The road to hell is paved with good intentions. In the matter of Alberta LTD v. Fossil Industries Inc., (Supreme Court of New York, Commercial Division, Order dated Sept. 8, 2014), hell was the court sanctioning defendants for discovery lapses. The good intention was on the part of the defendant who used an email archiving system that was apparently not configured to preserve important metadata.

Peter Coons

Peter Coons

The plaintiffs in this matter were “engaged in the business of graphic designs and signage fabrication and installation for outdoor use.” In 2008, the plaintiff began working with the defendants and purchasing their signage products. The plaintiff relied upon the defendant’s representations and guarantees as to the quality of their products. However, in 2010, the products purchased and installed by the plaintiff began to fail. The defendant then “began to impose different and more limited warranties on its purchase orders which conflicted with the express warranties contained in the defendant’s promotional literature.” The plaintiff filed suit and claimed the defendants did not “honor its obligations under its agreements and warranties contained in the defendant’s product literature.”

At the center of this motion were emails: messages that apparently contained evidence of the transactions between the two parties, as well as warranties and guarantees. The plaintiffs demanded the production of these messages and the court agreed that their production was appropriate.

“Since these transactions were accomplished through emails, the plaintiff demanded, and the court so directed, that these emails be provided in their native electronic format, together with their associated metadata, which the defendant failed to furnish. The instant motion was made following unsuccessful attempts at resolving the issues.”

The defendants’ opposition to the production of the native emails was based on two positions.

The first was that Fossil used a product called FileMaker to archive emails. They claim that this application stored the messages in their native format, but did not retain metadata.

The second position was that Fossil had already provided all the communications between the two parties and if that was not good enough or if the metadata is not intact, well too bad, because they did all they could and nothing more could be done.

“If the production is unsatisfactory to Plaintiff, it is only because of impossibility of production on the part of the Defendant”

Let’s tackle the first position. There are myriad reasons to employ an archive tool – especially for email: disaster recovery, preservation of data for litigation purposes, stress and space reduction on the email server. However, if used without regard for its purpose then the benefits are lost. Email archive systems should preserve key metadata elements such as dates, attachments, senders and recipients. Simply saving the body of the message may not be helpful and in this matter it proved detrimental.

When I first read this opinion, I was surprised to see that FileMaker was being used as an email archiving solution. It was surprising, because I have never seen it used in that fashion and did not know it was possible. FileMaker is a database application that is similar to Microsoft Access and it has been around for many years.

After some research I was surprised to find that FileMaker indeed can be used as an archiving solution for email platforms, including Microsoft Outlook. Perhaps the defendants did not use the proper settings when configuring FileMaker or they developed a homegrown application within FileMaker to archive messages. Whichever the case, they failed to exercise due diligence in maintaining an email archive system that would prove valid by today’s evidence-preservation standards.

Takeaway

Ensure that archiving systems and procedures capture and store information that sufficiently represents the original file and its metadata. The defendants claim the messages were stored in their “native format,” but metadata was not preserved. This is a problem.

An archiving system does not necessarily have to preserve files in “native format,” but it should preserve unaltered content and metadata. One could also argue that once a message is removed from a server (i.e. MS Exchange database) it is no longer in its native format and would instead be referred to as “near native.” However, the only people who would care to argue about such things are not the type of people you want at your cocktail parties – boring. Generally, my position is that an archived file or record that accurately reflects the contents and metadata associated with the original file is sufficient. Call it native, near native or whatever. A rose by any other name smells as sweet.

The second position taken by defendants was that they had handed over voluminous amounts of data and that is all they had! Apparently there was no mention of any email system other than FileMaker, even though that is not an email system in the true sense because it did not send or receive messages in this case. The defendants were using it as an archiving solution. No mention was made of attempts to recover or identify messages from other sources such as active or archived message stores.

The plaintiff’s expert opined that FileMaker is not an email application and while it can be used to store and archive message content, if not done properly it can alter or destroy useful metadata. The expert also noted that Fossil failed to describe or identify the email system used to create the original messages. Was it Outlook? Gmail? Who knows.

“From my review of the De Cesare affidavit, I found that Fossil did not disclose what email system it had been using or what happened to the original emails and files it subsequently stored in FileMaker.”

Takeaway

My ears perked up when I read about FileMaker. I am sure plaintiff’s ears were also twitching so they got a second opinion. The plaintiffs in this matter hired a computer forensic expert to investigate the claims that they had made. The expert identified a number of salient facts that may have been missed by someone with less experience. But even the average person who read the De Cesare affidavit should have questioned the mention of FileMaker and email.

Why were they not using Outlook or some other well-known platform? Getting that second opinion turned out to be a judicious move by plaintiffs. The court appeared to have relied heavily upon the expert’s affidavit in its decision.

If an individual has questions about the technical validity of claims made by a party then one should consider reaching out to a computer forensic expert or ask an internal IT person for a first or second opinion. Trust, but verify as I like to say.

In the end, the court noted that several of the defendant’s discovery issues were willful and further found that the lack of date information in the metadata had deprived plaintiff of discovery that was critical to the case. He issued the ultimate sanction by striking defendant’s answer and awarding judgment to plaintiff.

Was the defendant purposely hindering discovery and trying to hide critical evidence or was the missing metadata a result of a poor implementation of an email archiving solution? The court leaned toward the former although the latter certainly played a role in my opinion.

Peter Coons is a senior vice president at D4, providing eDiscovery and digital forensics consulting services to clients. Peter is a Certified Information Systems Security Professional (CISSP), an EnCase Certified Examiner (EnCE), an Access Data Certified Examiner (ACE), and a Certified Computer Examiner (CCE). He belongs to various digital investigation and information security based organizations. Peter holds a master’s degree in Digital Forensics Management from Champlain College and a bachelor’s degree in Economics from the State University of New York at Oneonta.