Power of Proof Newsletter - July 2008
In this Issue:
Authenticating Emails at Summary Judgment
Email Leads to Arrest of Bear Stearns Hedge Funds Managers
A Company Computer and Questions About E-Mail Privacy
Email Contracts: A New 'Signed, Sealed, Delivered'
E-Discovery Disclosure Goof Waived Attorney-Client Privilege, Judge Rules
E-Discovery: IT Execs Overconfident and Underprepared
ESI Trends Report from Kroll ONTRACK
Surety Announces International Reseller Partnerships with LG CNS and Samsung SDS
Authenticating Emails at Summary Judgment
Spam Notes
According to this article, some lawyers assume that an e-mail can be turned in with a “to” and “from” line and expect it to be allowed into evidence. As this piece explains, authenticating e-mails at summary judgment is not that easy.
The depth and complexity of authentication varies with each summary judgment situation. Depending upon whether you’re in favor of or against summary judgment, who the documents are produced by and other questions, authentication standards differ. Whatever the case, unless you are exempt under the business records rule, there are some thoughts you should keep in mind when authenticating e-mails for summary judgment:
- Do you need a declaration from the IT person/records custodian or a declaration from the author of the e-mails?
- Who are the e-mails being obtained from – are they forwarded from individual recipients and senders to the person gathering them, or are they accessed from a central location?
- Are the e-mail addresses visible or obscured (how about other similar information - title/contact information)?
- Are the e-mails altered in any way?
E-Discovery Leads to Arrest of Bear Stearns Hedge Funds Managers
Wall Street & Technology
Two former Bear Stearns employees have been accused of being involved in the collapse of two hedge funds that triggered the sub-prime mortgage crisis…all thanks to a simple e-mail.
An e-mail allegedly sent by Matthew Tannin, COO at Bear Stearns, to Ralph Cioffi, a senior portfolio manager of the two funds, is at the center of the controversy. The communication allegedly said that Tannin was "afraid that the market for bond securities they had invested in was 'toast,’” and suggested shutting the funds, according to the Wall Street Journal. Ironically enough, the two men told investors four days later that they were comfortable with their holdings.
A Company Computer and Questions About E-Mail Privacy
The New York Times
We’ve all heard the great debate about the privacy of personal messages sent by company-owned devices and it looks now that the controversy has spread to the email messages of former employees. Take Scott Sidell’s situation for example. Sidell claims that Structured Settlement Investments read emails from his personal Yahoo! account after he was fired from the company.
Structured Settlement Investments argues that Sidell came back to work after being fired and sent confidential company information to his personal email account, violating the terms of his employment contract. Regardless of the veracity of this point, the case raises the issue that Sidell’s personal account was accessed without permission, an act which many people would consider an invasion of privacy.
Stepping away from the case, this story is a good reminder that we live in an ever-evolving world of technology. As times goes on and we begin to develop more devices that help us communicate quicker, these types of cases are going to increase in popularity and questions surrounding privacy will keep mounting. Of course when others access your email accounts and other electronic information, there is potential for date tampering or alteration so it’s important to invest in the proper tools to protect your important info.
E-Mail Contracts: A New 'Signed, Sealed, Delivered'
New York Law Journal
Historically, contracts were required to literally be “signed, sealed and delivered” in order to be considered legitimate. However, the popularity of the Internet is shaking some things up. Parties are now able to agree to and execute contracts via email. (For an example of such a contract, read the 2005 decision made by the U.S. District Court for the Southern District of New York in Hostcentric Technologies Inc. v. Republic Thunderbolt, LLC., 2005 U.S. Dist. Lexis 11130 (S.D.N.Y. June 9, 2005))
This article goes on to explain other decisions that have addressed the issues of signatures and contract amendments, both of which are being influenced by electronic communications.
“As these recent decisions reflect, e-mail contracting can be an effective way to form an enforceable contract. They can, however, be a boon or curse. E-mail is a casual and speedy form of communications, previously unheard of in the practice of law and which belies its potential legal import.”
Now that email is growing in popularity in the world of contracts, it’s important that the parties remember the issue of authentication. Failing to prove the truthfulness of the documents at hand can lead to a dead end. As simple as it is to alter an email, who’s to say that what you’re presenting to the court is original in its entirety?
E-Discovery Disclosure Goof Waived Attorney-Client Privilege, Judge Rules
ABA Journal
U.S. Chief Magistrate Judge Paul Grimm ruled that Creative Pipe Inc. did not take the necessary actions to protect attorney-client privileges when the company mistakenly turned over 165 data-sensitive documents in e-discovery. According to Grimm’s decision, the company used untested-keyword searches to separate sensitive documents from the rest.
“All keyword searches are not created equal,” Grimm wrote in the May 29 opinion (PDF). “Any order issued now by the court to attempt to redress these disclosures would be the equivalent of closing the barn door after the animals have already run away.”
According to Grimm, courts have the following approaches that help them determine waiver when e-discovery documents are unintentionally disclosed:
“The intermediate test considers the reasonableness of the precautions taken to prevent disclosure, the extent of inadvertent disclosures, any delay rectifying disclosure, and the overriding interest of justice.”
E-Discovery: IT Execs Overconfident and Underprepared
Wall Street & Technology
Contrary to what IT executives may think, many of them are not ready to handle e-discovery requests. Most IT professionals rely heavily onsoftware that’s in place but many times it lacks critical features or simply isn’t properly deployed throughout entire the company.
Making bigger waves is the idea that many companies are still trying to sort out their e-discovery practices, an idea suggested by an IDC survey.
“Around 85% of companies said they have formalized litigation communications policies. But 55% said they are still in the early stages of automating the communications process. The survey found that 29% are primarily using voice communications and in-persona notices -- while 13% are still using paper-based surveys.”
This is astonishing considering the vast amount of information that is out there about the importance of e-discovery best practices. Companies should be well underway in creating an action plan and delegating responsibilities. It’s impossible to sort it out when you’re at the mercy of a court, so why wait until the last minute to prepare? Take the time now to establish an e-discovery process so you don’t face the pressures and costs of a having to figure out your e-discovery plan at the last minute.
ESI Trends Report from Kroll ONTRACK
Complex Discovery
Wouldn’t you think that legal professionals would be up to speed on ESI if they were managing it for their clients? One would sure hope so, but according to research conducted by Kroll ONTRACK, many of these attorneys are still simply trying to figure out what ESI exactly is.
The survey revealed in-house counsel’s legal and technology experiences, specifically their ESI management practices. The results boiled down into three themes:
- Preparedness: Organizations are not properly managing their ESI due to a lack of “understanding, preparedness, and enforcement”.
- Ownership: Company departments are unsure of their responsibilities when it comes to ESI matters.
- Challenges: U.S. and U.K. legal teams each have different ESI priorities, thus creating confusion across all borders.
E-discovery “ownership” challenges are something we’ve certainly see on a regular basis – IT and legal departments are often unsure which should take the lead of preparing an organization for e-discovery compliance and the result is that the proper precautions are never implemented. As we’ve seen time and again, failing to prepare for e-discovery is often very costly and can seriously impair a business’s case. Communication between IT and legal departments is crucial and the two teams must work together to figure out what works best for each organization in order to avoid an e-discovery nightmare later down the road.
To learn more about the research findings, be sure to check out the report in its entirety.
Read the full article
Surety Announces International Reseller Partnerships with LG CNS and Samsung SDS
Surety, LLC announced two major international reseller agreements in June, both with Korean-based IT services companies helping businesses secure and protect electronic records as they transition to a paperless office. Under the terms of the agreements, LG CNS and Samsung SDS will integrate Surety’s AbsoluteProof service into third-party electronic record archive systems to Seal electronic documents sent to the companies by their respective affiliated businesses.
LG CNS and Samsung SDS are the second and third largest operators, respectively, for the Korean government’s certified e-document authority (CeDA), a 2006 government initiative to help Korean businesses realize the cost savings and simplified business processes associated with the paperless office. As the Korean government increases its focus on e-business and the realization of paperless and simplified business processes, AbsoluteProof will enable users to ensure the security and litigation-readiness of their electronic documents.