Looking Back on 2015: The 6 Most Important eDiscovery Cases in Delaware - Part 1

This is the first in a series of posts summarizing the 6 most important eDiscovery cases in Delaware in 2015.

In re: ISN Software Corporation Appraisal Litigation, C.A. No. 8388–VCG, Oral Argument on Petitioners Motion to Compel and Partial Rulings of the Court, April 27, 2015.

In this fifth motion to compel before Vice Chancellor Glasscock, petitioners concerns were focused on the problem that several of respondent’s key custodians had received new computers during the pendency of the litigation and the whereabouts of the old machines were unknown.  Despite the fact that ISN stated that “everything” got rolled forward on to the new computers, petitioners felt this was insufficient for a couple of reasons.  First, they were concerned that the process was unsupervised and that custodians may have been left to pick and choose what actually got copied to the new machine, especially given that ISN did not keep any records on what was transferred from each computer.  Second, because several of the computers at issue were Surface Pros, which have a solid state drive, petitioners’ technical experts explained that the metadata that was on any original documents would not have been copied in toto to the new machines.  So any old documents would translate now as brand new documents (with revised date and other metadata) on the new computers.  Without the old computers to examine, it would be extremely difficult to ensure that all documents had been properly preserved.

Petitioners requested not only fee shifting but also a burden shift at trial and that the Court recognize that spoliation had occurred.  Vice Chancellor Glasscock explained that he had the same concerns that he had for the third and fourth motions to compel (which we discussed in our previous blog post), which is “are we creating an evidentiary universe from which I can render a just opinion?”  His main question for ISN was whether or not they had done a vigorous and complete search for the missing machines and had they looked exhaustively for any form of backup that could corroborate their statements that everything had been transferred to the new ones?

Given that ISN had originally stated that the laptops did not exist and did not admit that they did until petitioners had found proof, the Vice Chancellor was concerned that ISN was being “less than forthcoming” and while he felt that these issues were probably peripheral to the actual dispute between the parties, he seemed suspicious about why this information had been so difficult to get out of ISN.  Vice Chancellor Glasscock ruled that there would be fee shifting for petitioners bringing the motion and possibly additional fees if it seemed that the missing information created more expense in the future (such as requiring repeated or additional depositions).

However, the Vice Chancellor did not feel he was ready to rule on the remaining sanctions with the current record.  He ruled that the parties should continue to depositions and that a case schedule should be put in place.  Once the facts of the case have been developed, he will determine whether this additional spoliation needs to be taken into account, whether through burden shifting or another remedy.

The Vice Chancellor stressed that ISN had “triggered [his] concern at this point and anything they can do to alleviate that…would be helpful, ultimately, to them, and they should undertake that.”  He requested that counsel communicate this with their client and, once an exhaustive search had been undertaken, that counsel put a letter in the record confirming that fact.

This case demonstrates the Court’s wish that parties remain transparent and forthcoming throughout the discovery process.  Parties who refuse to do so may find their veracity questioned later in the case.