Navigating the New E-Discovery Rules

By Paul D. Weiner and Mary Kay Brown

Imagine having to tell your client that it must pay more than $1 billion in damages. Imagine now that such a verdict was the direct result of multiple sanctions imposed by the court for discovery violations resulting from the failure to preserve and produce electronic information. If there is any doubt that electronic discovery issues can have a drastic impact on the outcome of cases, Coleman Holdings, Inc. v. Morgan Stanley & Co., Inc. [1] should serve as a wake-up call to all trial lawyers practicing in today’s digital age.

Although the primary claim in the Coleman case was that the defendant, an investment banking firm, conspired with one of its clients to perpetrate a fraud, shortly before trial the judge took the extraordinary step of reversing the burden of proof for fraud based on the defendant’s “willful and gross abuse of its discovery obligations.” Thus, the defendant had to prove to the jury that it lacked knowledge of its client’s accounting fraud and did not conspire to defraud the plaintiff. The court also permitted the plaintiff to read a statement to the jury detailing the defendant’s efforts to hide its emails as evidence of its evil intent. Finally, after still more discovery violations came to light, the court took the additional step of reading a 12-page adverse inference instruction to the jury that described the defendant’s fraudulent scheme in devastating detail.

For more see’s Tips from the Trenches.


One Response

  1. thanks for the GREAT post! Very useful…

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: