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Bad Faith Custodians and Other People Problems

Created on July 15, 2019

Director of Marketing at Exterro

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A custodian intentionally deletes data. IT accidentally erases a laptop of a departing employee on legal hold. These are the worst of the worst, things you have nightmares about. Over the next month, we asked e-discovery professionals how they dealt with these e-discovery "worst case scenarios" and how to respond to them.

This week we are addressing "worst case scenarios" around bad faith custodians.

Without a doubt, one of the worst possible scenarios for an e-discovery professional is a bad faith custodian—someone who is more concerned with protecting themselves from any possible repercussions of their actions than with providing an accurate record of their communications, work product, etc. After all, it can be difficult enough to identify, preserve, and then produce all the relevant electronically stored information (ESI) for a given matter without having someone who’s trying to thwart your best efforts!

What are the steps you can take in these situations?

Educate Employees

Really, this first tip is more about prevention than remediation—but it’s really the most important tip. Make sure all employees are aware of their obligations in the event of a legal hold. After all, an ounce of prevention is worth a pound of cure.

“The employee handbook should explain that there may be situations in where employees may have to provide evidence in litigation. Explain the process that the organization uses to obtain relevant ESI, as well as whatever HR policies are in place to deal with non-compliance with organizational policies. In many respects, this is a human resources issue, not a legal department issue,” explains Albert Barsocchini, Director of Strategic Consulting at NightOwl Discovery.

Verify Bad Faith

Although less famous than Occam’s razor, Hanlon’s razor is a philosophical test that you should apply if you encounter what appears to be a bad faith custodian—Never attribute to malice that which is adequately explained by incompetence. If you’re concerned that a custodian in a legal matter or investigation is intentionally spoliating data, make sure of it before you take any hasty actions.

After all, inadvertent spoliation is far more common than intentional deletion.

“Before jumping to conclusions, make sure that it’s really a bad faith situation, as opposed to a misunderstanding about what exactly a custodian is supposed to do. Once you determine that the custodian is not providing information that you’ve requested, then I would consider my options instead of immediately going aggressively after him,” Barsocchini said.

In fact, there might even be back-door solutions by working with your IT team. For example, legal teams should try and work with their IT counterparts and send a notice to employee at issue and say they need to change their login in credentials, when in reality they are limiting that custodians access to data, preventing subsequent spoliation.

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Consider conducting this conversation in the course of a typical custodian interview.

Involve Human Resources

Since non-compliance is a violation of organizational policy, don’t hesitate to bring in an HR person to have a discussion with the custodian. Remind them of the policies that they accepted when they took their position. If at all possible, consider using the carrot, not the stick, to get compliance. “Try to push the custodian in the direction of providing the information without immediately strong-arming him or her. In my experience, that approach usually shuts down the conversation. Remember, your goal is to get the ESI so you can move forward with discovery and litigation,” says Barsocchini.

Back-ups Aren’t Just for Data

Joe Mulenex, Director of Solutions Consulting at Exterro, explains, “People think of redundancies from a technology perspective. If my system goes down, I can roll to a hot backup. It makes a lot of sense. But it’s also possible to put too much control or rely too greatly on a single human resource, as well. It’s extremely risky.”

Many companies operate that way—without redundancies for key personnel—because of the mandate to run lean and “do more with less.” But that attitude can put key personnel under stress, leading to mistakes or missed deadlines. One such worst case scenario follows.

Missing in Action

“We were in final production before a big trial started. Everything had been done, and we were down to the final quality control step. Everything was produced, imaged, and numbered. We knew the 18,000 documents that were going to be submitted as exhibits,” Mulenex recalls. “The final step was performed by our senior production person. And for lack of a better term, he had a nervous breakdown on the job. The deadline was midnight, and at 11:45 pm, he closed his computer, picked it up, and walked out the door. He didn’t submit the production, didn’t push the data out, nothing.”

“No one knew until the next morning, when the head litigator came in to the office and said, ‘I didn’t get the receipt that said we filed.’ We dug into it and found out that the production person had downloaded everything to their local machine and walked out the door with it.”

Implement Fail-safes

Responding to a people-centric crisis isn’t that different than other crises. It requires a two-fold response: figuring out what happened and notifying impacted parties. In this case, technology helped compensate for human error, as there was a backup on the servers.

“We pulled the data into the filing system and got it out. We ended up being only about seven hours late, and we were still four weeks ahead of the actual trial date. Because we did our best, nobody raised a stink. Even the judge said, ‘Tell us the root cause later,’ Mulenex remembers. “I don’t think we reported ‘nervous breakdown’ as a root cause. But knowing you have a critical deadline, pinning your reliance on a single point of failure and not having safeguards was a huge miss. In subsequent productions, we went to a ‘two-key’ system and never had that problem again.”

For smaller teams, it may not be easy to have two resources with comparable skills, but having a seasoned partner understands these issues can help you avoid pitfalls and mitigate risks.

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Check back next week for another blog post about e-discovery worst case scenarios and how to respond!