Beginning Next Week: InsideCounsel will become part of Corporate Counsel. Bringing these two industry-leading websites together will now give you comprehensive coverage of the full spectrum of issues affecting today's General Counsel at companies of all sizes. You will continue to receive expert analysis on key issues including corporate litigation, labor developments, tech initiatives and intellectual property, as well as Women, Influence & Power in Law (WIPL) professional development content. Plus we'll be serving all ALM legal publications from one interconnected platform, powered by, giving you easy access to additional relevant content from other InsideCounsel sister publications.

To prevent a disruption in service, you will be automatically redirected to the new site next week. Thank you for being a valued InsideCounsel reader!


More On

E-discovery: 4 elements of an effective arbitration agreement addressing duty to preserve

A well-drafted agreement can fill the gap when there are no rules for e-discovery preservation

This is the seventh and final column in a series addressing the challenges and opportunities of litigating in forums with few e-discovery rules or precedents. Read parts one, two, three, four, five and six. The previous columns have focused on litigation in the state trial courts. This final column turns to the topic of e-discovery in arbitration.

Many have written about the challenge of maintaining arbitration as a more efficient and less burdensome forum for dispute resolution in the era of e-discovery. In theory, the parties to a contract that includes an arbitration clause could, by prospective agreement, eliminate all the ills of e-discovery and create a framework for reasonably tailored discovery proportionate to the parties’ dispute. The reality of e-discovery in arbitration, however, is more complicated, as the numerous articles on this topic reflect. Part of the problem is that many arbitration agreements encompass a range of potential future disputes too broad for a one-size-fits-all approach to e-discovery. Another obstacle is the perception that one side may be gaming limitations on e-discovery to obtain an unfair advantage. However, the parties to an arbitration agreement do have the opportunity to address, prospectively and evenhandedly, at least one of the key drivers of e-discovery burden—the amorphous duty to preserve potentially relevant evidence.

A well-drafted arbitration agreement should include a separate arbitration clause that specifically addresses the duty to preserve evidence and provides both parties a reliable and binding process for early resolution of any disputes over the scope of the obligation. If drafted with care, an agreement defining a specific process for notice and expedited resolution by the arbitrator could do much to resolve the risk and uncertainty that too often forces litigants to implement overbroad and burdensome internal litigation holds.

An agreement to arbitrate the duty to preserve would include at least the following elements:

1. Delivery of a clearly defined notice as the sole trigger for preservation. Although the general standard for when a duty to preserve arises is easy to describe, its application in any particular case defies bright lines. Under an arbitration clause, the question of when the parties “reasonably anticipate litigation” may be further blurred by multi-step procedures for voluntary resolution before any party actually serves an arbitration demand. And, when the arbitration demand arrives, it may be too vague to identify clearly what issues the parties are litigating. An amorphous dispute with no mechanism for promptly clarifying what to preserve sets the stage for a potentially onerous litigation hold. This burden could be mitigated by including in the parties’ arbitration agreement a stipulation that, as between the parties, a duty to preserve evidence will arise only when the requesting party delivers a specific form of notice that identifies the categories of files to be preserved and the claims for which these files are relevant. 

2. A presumption against preserving metadata and inaccessible data. E-discovery geometrically increases the burden of a litigation hold because the preserving party, in the absence of a safe harbor, may have to retain not only the content of active user files but also the metadata associated with each unique copy of potentially responsive files and the archival or backup copies of such files and, in some cases, even forensically recoverable data. In most cases, few of these sources that fall within the scope of the litigation hold ever actually yield any additional material evidence, although they greatly exacerbate the cost of e-discovery. An arbitration agreement that limits preservation to the user-created content of active files, or at least directs that the arbitrator should require broader preservation only in exceptional cases, could substantially reduce the preservation burden.

3. Prompt resolution of any dispute regarding the scope of preservation. Of course, even with the benefit of a clear notice trigger and a prospective agreement limiting preservation to active user-created file content, the parties still may disagree about the scope of preservation. Because the preservation notice may precede the filing of a formal arbitration demand, the agreement should provide for expedited appointment of an arbitrator to consider the dispute and issue an award. The American Arbitration Association’s Optional Rules for Emergency Measures of Protection provide a useful model.

4. Binding application in all related disputes between the parties. Early resolution of a party’s preservation obligation is of little use if the arbitrator’s jurisdiction is in doubt. Even if the particular substantive dispute is clearly arbitrable, it could arise in the context of other related claims that may not be. Accordingly, the parties should clearly specify preservation as an arbitrable dispute within the arbitrator’s jurisdiction even if the substantive claim giving rise to the preservation demand is non-arbitrable. By treating preservation as an arbitrable dispute that the arbitrator resolves in a final award, instead of simply as a discovery issue, the parties can protect the finality of the arbitrator’s decision and ensure a meaningful safe harbor against subsequent claims of spoliation.


author image

Matthew Prewitt

Matthew Prewitt is a partner in the Chicago office of Schiff Hardin, where he concentrates in complex litigation and also co-chairs the firm's Trade Secrets Client Services...

Bio and more articles

Join the Conversation

Advertisement. Closing in 15 seconds.