Judicial Interpretation of an ESI Protocol

This blog discusses how the Court interpreted the ESI protocol in McCormick & Co., Inc. v. Ryder Integrated Logistics, Inc., 2023 WL 2433902 (D. Md. March 9, 2023)(Bredar, J.), McCormick was a consolidated breach of contract action involving multi-million dollar claims.

The Court wrote:

The ESI Protocol provides, under a subsection titled “No Presumption of Responsiveness,” that “a party’s obligation to conduct a reasonable search for documents in response to discovery requests shall be deemed to be satisfied by reviewing documents that are captured by utilizing the methodology provided for in this Protocol” and that “[t]he fact that a document is captured by a search pursuant to this protocol does not mean that such document is responsive to a discovery request or otherwise relevant to this litigation and Parties may exclude such nonresponsive documents from production.”[1]

McCormick then discovered that, despite its “issuance” of a litigation hold, a key custodian’s files were deleted when she left employment.  McCormick then – commendably and properly[2] – notified Ryder.  It gathered ESI from six additional custodians and performed searches to capture the missing information.[3]

Ryder argued: “This has resulted in a significant increase in the number of potentially relevant documents.”  Ryder calculated that approximately 30% of hits with families resulted from these additional searches.

The Court explained what followed: “The instant issue arose when the parties disagreed as to whether they were required to manually review these documents (i.e., the documents captured by the search terms) for relevance prior to production, or whether [McCormick] could produce those documents without a document-by-document review.”

In short, McCormick, having failed to properly implement the litigation hold, produced additional documents, and wanted to shift the burden to Ryder to review them for relevance.  The tactic failed.

The Court held that the ESI Protocol mandated a document-by-document review by the producing party.  It wrote:

[T]he language providing that “a party’s obligation to conduct a reasonable search for documents in response to discovery requests shall be deemed to be satisfied by reviewing documents that are captured by utilizing the methodology provided for in this Protocol” plainly requires such review.

It specifically cited the Protocol’s language that “a party’s obligation to conduct a reasonable search for documents in response to discovery requests shall be deemed to be satisfied by reviewing documents that are captured by utilizing the methodology provided for in this Protocol.” [emphasis added by the Court].

The Court added that “ it defies logic that the ESI Protocol would provide for a party to review documents but not to exclude irrelevant documents identified in that review.”  [emphasis added].

In rejecting McCormick’s proportionality argument, the Court relied on: the parties’ agreement; the fact that McCormick’s error created the problem; and, the fact that McCormick estimated the review cost at $240,000 in a $4 million case.

The Court also rejected the argument that its decision invariably mandated document-by-document review in every case:

McCormick argues that [Magistrate] Judge Copperthite concluded that there is some overarching duty to conduct a document-by-document review based on his reading of the case law. Once again, as with the ESI Protocol, McCormick cherry-picks and misstates the [Magistrate Judge’s] Discovery Order. Judge Copperthite never concluded that there exists a per se duty to conduct such a manual review; he concluded that—in this case, given the facts and circumstances, including an ESI Protocol that explicitly provides for it—McCormick and Ryder must conduct such a review. Of course, in the absence of the ESI Protocol, Judge Copperthite may (or may not) have concluded differently, and the cases cited by Judge Copperthite and the parties reflect that a manual review may or may not be appropriate, depending on the circumstances. However, Judge Copperthite, having appropriately considered the agreement between the parties and the facts of the dispute, determined that a document-by-document review in this case was required.

It is axiomatic that litigants must Be Careful What You Agree To, But the Duty to Cooperate May Provide an Escape Hatch (Part II).

In Should an ESI Protocol Be Incorporated Into a Court Order?, I discussed how, upon one party’s motion, the Court in McCormick & Co., Inc. v. Ryder Integrated Logistics, Inc., 2023 WL 2433902 (D. Md. March 9, 2023)(Bredar, J.), incorporated an ESI Protocol into a Court order.

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[1] For more information on excluding documents that are on “hit reports,” please see How to Avoid Contentious “Hit Report” Problems and Hit Reports.

[2] See Damage Control Method (prompt and voluntary disclosure of error), Is There a Duty to “’Fess Up?”,  and, Is There a Duty to “’Fess Up?” – Part II

[3] Under Fed.R.Civ.P. 37(e) sanctions are not available if there is satisfactory secondary evidence.  McCormick’s approach was tactically prudent.