Note: This is an unpublished decision. Check your jurisdiction’s rules about citing unpublished decisions before citing this case to a court.
No. Civ.A. 18894-NC
Court of Chancery of Delaware
April 16, 2002
*1 This is my decision with respect to the two pending motions in this case. Plaintiffs have moved to compel defendants to produce certain e-mail communications and to conform their privilege log to the requirements of Delaware law. Defendants, in turn, have cross-moved for an order requiring plaintiffs to provide precise and meaningful answers to defendants' interrogatories.
Having thoroughly reviewed the parties' arguments, I conclude that plaintiffs' motion to compel defendants to produce certain e-mail messages retrievable from Kinko's back-up system must be granted. As to defendants' privilege log, it is necessary for this Court to make determinations regarding the propriety of the privileges invoked. Thus, the files listed on pages 14-16 of plaintiffs' reply brief must be reviewed in camera,
unless defendant provides additional information regarding them. Finally, I am not persuaded that plaintiffs must provide more detailed answers to defendants' interrogatories. Thus, defendants' motion is denied.
Simply stated, the underlying action stems from a valuation dispute arising as the result of two merger agreements. As a result of Kinko's effort to enter the e-commerce business, it created a subsidiary, Kinkos.com, into which Liveprint.com merged around February 2000. After the “.com bubble” burst, and Kinkos.com under-performed, Kinkos.com was merged into the Kinko's Merger Corporation towards the latter part of 2000. Later, litigation regarding the second transaction's share valuation ensued, in the course of which plaintiffs made a series of discovery requests that are the subject of the pending motion.
The defendants' responses to these discovery requests, plaintiffs argue, remain unsatisfactory and plaintiffs now seek to obtain the required relevant information by way of motion. More specifically, plaintiffs seek to compel defendants to produce, for inspection and copying, defendants' electronic mail (“e-mail”) (and possible attachments thereto) that they created from December 1999 to present. In addition, plaintiffs insist that the Court should compel the defendants to produce a privilege log in compliance with the guidelines of Delaware law by specifying the grounds upon which they premise the privilege protection that they invoke. Furthermore, plaintiffs invite the Court to determine in camera
whether the documents identified in the privilege log actually deserve to be protected against discovery. Finally, plaintiffs ask the Court to compel the defendants to produce the entirety of those documents that had previously been produced in a redacted version. Defendants cross-moved, asking the Court to compel plaintiffs to provide more detailed replies to defendants' interrogatories.
As to the production of e-mail communications, plaintiffs allege that the e-mail messages they seek to discover may constitute the core of relevant corporate communications regarding the transaction issue. Since less burdensome means of discovery, such deposing the defendants, do not promise to produce evidence of the same import, plaintiffs contend that the disputed e-mail messages must be produced. Defendants respond that Kinko's does not at present possess an electronic document storage retrieval system that makes the requested information readily accessible and available. Although there is a conversion technique that would allow defendants to restore the requested e-mail files, the actual process of retrieving them will be time consuming and costly, perhaps, approaching $100,000 for all of the e-mail communications. Defendants also argue that the retrievable information will be cumulative by nature and, thus, they question the legitimacy of the request. Defendants insist that the burden that the retrieval process would impose on Kinko's outweighs the potential evidentiary benefit that plaintiffs would obtain from the documents.
*2 Kinko's uses a back-up system that creates monthly back-up tapes on the first Friday of every month, which serves to store the complete set of e-mail communications traveling through the company's system within a defined time frame. These tapes, in contrast to those produced on a weekly basis, are not recycled and are, therefore, retrievable at present. Hence, all e-mails that Kinko's employees either send or receive will necessarily be stored on the back-up system, including communications with Kinkos.com employees. As the group of disputed e-mail messages appear to meet the broad definition of discoverable material under Rule 26(b)(1), plaintiffs have made a sufficient showing to require their production.
The federal case law
to which plaintiffs point is persuasive authority for requiring defendants to comply with the request, notwithstanding defendants' cost and convenience arguments. Although the imposition of not insubstantial cost may appear to be unfair, the need to provide an information retrieval system is the prevailing concern.
There also is authority that while in the discovery stage a company may be required to produce printouts of computer data.
Upon installing a data storage system, it must be assumed that at some point in the future one may need to retrieve the information previously stored. That there may be deficiencies in the retrieval system (or inconvenience and cost associated with the actual retrieval) cannot be sufficient to defeat an otherwise good faith request to examine relevant information (or information likely to lead to the discovery of admissible evidence). Thus, plaintiffs' motion regarding the production of e-mail communications is granted.
Turning next to the issues regarding the supplemental privilege log, I cannot agree with defendants that the log meets the requirements of our law. Plaintiffs correctly note that a series of entries on the log raise doubts as to whether the attorney-client privilege has been properly invoked. A number of times the privilege log notes that certain e-mail messages “seek to obtain legal advice” where the parties participating in the communication appear to either fail to offer or were incapable of rendering the type of advice necessary to rely properly upon the attorney-client privilege. I therefore will direct defendants to submit, for in camera
review, those communications listed in plaintiffs' reply brief (on pages 14-16), unless defendants elect to provide more detailed explanations regarding these entries on the privilege log.
Finally, defendants contend that plaintiffs should be required to provide more detail in their interrogatory answers. The interrogatories asked plaintiffs to identify the factual basis for their allegations. I agree with the plaintiffs, however, that the responses have, for the most part, been adequate. Moreover, defendants have the ability to obtain clarification and specification during depositions of the plaintiffs, which is an easier method to obtain such information. Nevertheless, I do agree with the defendants that plaintiffs' response to Interrogatory Number 1 should be answered with greater specificity. Interrogatory Number 1 asks for the identity of persons knowledgeable about the facts and issues alleged in the complaint and a summary of their knowledge. Because plaintiffs provided a long list (71 individuals and 2 entities) without any summary description of their knowledge, the defendants have no meaningful method for determining whom to depose or how to prepare for such a deposition. Accordingly, I will direct plaintiffs to provide more refined and specific responses to Interrogatory Number 1. In all other respects, however, defendants' motion to compel is denied.
Defendants have not argued that the e-mail documents are not relevant or likely to lead to the discovery of admissible evidence.
In re Brand Name Prescription Drug Antitrust Litigation, 1995 WL 360526 (N.D. Ill. June 15, 1995), a case involving a similar discovery question, i.e.,
the retrieval of CIBA's intra-corporate e-mail communications from the company's computer system with the objective of obtaining responsive e-mail evidence. The District Court noted that, “if a party chooses an electronic storage method, the necessity for a retrieval program or method is an ordinary and foreseeable risk.”
Daewoo Electronics Co. v. United States, 650 F.Supp. 1003, 1006 (Ct.Int'l Trade 1986) (United States Court of International Trade acknowledged the peril that resides in allowing new techniques of information management and storage to hinder the discovery and disclosure that our litigation system is built upon.).
Bills v. Kennecott Corp., 108 F.R.D. 459, 461 (D.Utah 1985).
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