Rhoads decision first to apply FRE 502

December 12th, 2008 | By Steve Puiszis

Federal Rule of Evidence 502 was recently enacted to address the inadvertent waiver of privilege. Rhoads v. Building Materials Corp. of America, 2008 WL 4916026 (E.D. Pa. Nov.14, 2008) is the first case to address Rule 502 and its application to inadvertently produced electronic data.

Several points about Rhoads bear mentioning. First, even though the lawsuit was filed and the inadvertent production occurred before the enactment of Rule 502, the district court found it was “just and practicable” to apply Rule 502 in the case before it. So Rhoads supports the notion that the Rule can be applied even when the discovery production occurred before Rule 502′s effective date.

Second, even though an e-discovery consultant was retained and a “fairly sophisticated screening device” was used to screen a data set for privilege and work product, the court found that attorney-client privilege was waived as to a group of documents for which a privilege log was not provided on a timely basis. This case teaches that F.R.C.P. 26′s obligation to provide a privilege log must be taken seriously and that Rule 502 may not save you if a privilege log is not timely provided.

The court in Rhoads cited with approval Victor Stanley, Inc. v. Creative Pipe, Inc., 250 F.R.D. 251 (D. Md. 2008), which discussed the care that must be taken when using keyword searches during privilege review and noted: “An understandable desire to minimize costs of litigation and to be frugal in spending a client’s money cannot be an after-the-fact excuse for a failed screening of privileged documents.”

Victor Stanley acknowledged that keyword searching has been widely accepted by courts when parties use them to search for responsive documents to a discovery request. However, the court in Victor Stanley further explained that “simple keyword searching is inadequate in at least some discovery contexts” because keyword searches end up being both over and under – inclusive. One such context where extreme care must be taken with keyword searches is when keywords are used to find privileged documents. When an inadvertent production of privileged documents occurs as in Victory Stanley, a party that used a keyword search to screen for privilege has the burden to demonstrate that the search methodology was reasonable. Because the defendants failed to prove the reasonableness of their methodology, the court in Victor Stanley concluded that attorney-client privilege had been waived as to the particular documents that had been inadvertently produced in that case.

Rhoads however, provides at least a partial answer to the problem noted in Victory Stanley when search techniques or methodologies are used to screen a set of documents for privilege. The district court in Rhoads concluded that the use of a “fairly sophisticated screening device” showed substantial compliance with F.R.E. 502(b)’s requirement that reasonable steps be taken prior to production to prevent inadvertent disclosure.

The district court in Rhoads issued another twelve days later, which addressed privilege log issues for an e-mail string. That opinion notes there is disagreement among various district courts as to whether only the last message sent to an attorney which is part of an email string or all messages which make up that string have to be included in the privilege log. For examples of the contrasting viewpoints, see Baxter Healthcare Corp. v. Fresenius Medical Care Holding, Inc., 2008 WL 4547190 (N.D. Cal. Oct. 10, 2008) (ordering production of a log “that separately identifies the author, reciepient(s), copyee(s), and blind carbon copyee(s) for each logged email communication regardless of whether the communication is part of an email string”), with Muro v. Target Corp., 250 F.R.D. 350 (N.D. Ill. 2007) (holding only the last email sent to an attorney should be logged because logging the preceding emails which are part of the string and which are not themselves privileged could thereby reveal what information was sent to the attorney and result in a breach of attorney-client privilege), and Rhoads v. Building Materials Corp of America, 2008 WL 5082993 (E.D. Pa. Nov. 26, 2008) (same).

For movie trivia buffs, if you run a Google search on the word “privilege,” you will eventually discover a 1967 movie by the same name which has been described by some as a “mockumentary” and others a “cult film.” The movie, Privilege, stars the “immortal” Paul Jones who plays a rock star in the future where entertainment is controlled by the government. This weekend, see if you can find a copy of the movie Privilege and while you are it, checkout Rhoads so that your next privilege review doesn’t turn into its own ediscovery “mockumentary.”

Leave a Comment »

---