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More than a slap on the hand…

On May 3, the 10th Circuit Court of Appeals issued the rare published decision pertaining to an electronic discovery dispute. Markyl Lee et al v. Max International, LLC is worth a read simply based on plaintiffs’ incredible chutzpah and misconduct. Given the level of “bad acts” at issue, are there any takeaways for those of us in the e-discovery space? I propose three.

First, the court affirms the well-established principle that FRCP 37 provides a safe harbor from sanctions for those who lack control over the requested discovery materials or who discard them as a result of good faith business procedures.

Second, it is worth remembering that FRCP 37 limits the imposition of the most sever e-discovery sanction—dismissal—to instances where there is “willfulness, bad faith or some fault.” Inadvertent failures in the e-discovery space can give rise to lesser, albeit serious, sanctions. But whatever they are, they likely won’t be fatal to your case.

Finally, appellate courts likely will not disturb discovery sanctions imposed by trial courts. In fact, Judge Gorsuch notes that circuit courts should show deference to a district court’s sanction for a discovery dispute by applying the standard of “gimlet eye.” He further states that district court judges have special discretion to determine which sanction fits a “discovery crime” because they “live and breathe” discovery problems and are in a better position to assess appropriate sanctions than a circuit court who encounters discovery issues “rarely and then only from a distance.”

So take a look at the case. Marvel at the misconduct. Ponder how you can perform e-discovery better.