The legal landscape is now littered with parties--and their attorneys--who have been sanctioned by courts for electronic data discovery failures. Most of the litigation dealing with the loss of digital information addresses the failure of a party to preserve and collect the data after it was under a legal obligation to do so. The scope of that legal obligation is still not fully understood by many attorneys and their clients: it includes electronically stored information (ESI) held by third parties in many circumstances. Which circumstances? Consider the following scenarios.
Scenario 1: A global chemical and cleaning products company has some products manufactured by third-party suppliers. Some data concerning product formulation, manufacturing processes and quality control, testing and compliance resides with those contractors.
Common third party "control" situations
Based on experience and a review of the cases concerning the meaning of "control" for purposes of Rule 34, there are three frequent scenarios that your organization is most apt to encounter:
1. Information in the possession of legally related third parties
Information in the possession of former employees
Cache La Poudre Feeds, LLC v. Land O' Lakes, Inc., 2007 US Dist LEXIS 15277 (D. Colo. 2007), raised the issue of whether, and to what extent, a party may be obliged to contact former employees who the party had reason to believe possessed responsive information, under the "control" prong of Rule 34. The court recognized that "[u]nder some circumstances, a court could determine that an employer has control over documents maintained by a former employee," for example, suggesting that an employer may have "control" over information in the possession of a former employee if that individual is still receiving economic benefits from the employer.