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The E-Discovery Plot Thickens with the Passing of FRE 502

On September 19, 2008, Federal Rule of Evidence (FRE) 502 passed into law with the goal of establishing uniform, nationwide standards addressing the waiver of attorney-client privilege and work product protection. Besides healing the rift between numerous jurisdictions with varying standards, FRE 502 responds to rapidly escalating e-discovery costs by attempting to change the traditional document-by-document review process.

"The proposed new rule facilitates discovery and reduces privilege-review costs by limiting the circumstances under which the privilege or protection is forfeited, which may happen if the privileged or protected information or material is produced in discovery," according to the committee notes for the rule. "The burden and cost of steps to preserve the privileged status of attorney-client information and trial preparation materials can be enormous. Under present practices, lawyers and firms must thoroughly review everything in a client's possession before responding to discovery requests. Otherwise they risk waiving the privileged status not only of the individual item disclosed but of all other items dealing with the same subject matter. This burden is particularly onerous when the discovery consists of massive amounts of electronically stored information."

502(b) is the rule's core provision. It states that an inadvertent disclosure will not constitute a waiver when made in a federal proceeding or to a federal agency, if the privilege holder took reasonable steps to prevent disclosure or rectify the error.

Despite finding for the receiving party on the first four factors--meaning that the producing party's processes were not "reasonable"--the Rhoads court nevertheless put a heavy weighting on the final "justice" factor:

"I find that the fifth factor, the interest of justice, strongly favors Rhoads. Loss of the attorney-client privilege in a high-stakes, hard-fought litigation is a severe sanction and can lead to serious prejudice. ... [D]enying these documents to Defendants is not prejudicial to Defendants because, in the first place, they have no right or expectation to any of Rhoads's privileged communications."

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Dean Gonsowski

A former litigator, general counsel and associate general counsel, Dean Gonsowski is the global head of information governance at Recommind and has more than 15...

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