by Philip Favro, IG & eDiscovery Consultant, Innovative Driven, with Practical Law Litigation
This document is published by Practical Law and can be found at: us.practicallaw.tr.com/W-001-3978
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Safeguarding privileged information remains a difficult proposition in civil litigation given the ongoing proliferation of electronically stored information (ESI) among organizations and individuals.
Because of the potential for privilege waiver and the human effort required to properly identify and log privileged information, counsel should consider ways to optimize the privilege workflow. Although it often seems like a high-risk, low-reward process, the resolution of a discovery dispute over privileged documents can affect litigation outcomes in certain cases.
Getting the privilege process right is accordingly an essential aspect of a successful litigation strategy. This Article examines steps counsel can take to develop a cost-effective and efficient process for handling privilege issues. In particular, counsel should:
- Lower the risk of inadvertent disclosures by:
- exploring methods for simplifying requirements for logging and clawing back privileged documents;
- approaching litigation adversaries to determine whether they are agreeable to those or other methods for simplifying privilege logging requirements; and
- seeking appropriate court orders, including non-waiver orders under Federal Rule of Evidence (FRE) 502(d) (502(d) Orders). (See Methods for Simplifying Privilege Logs and Protecting Against Inadvertent Disclosure.)
- Develop an internal review workflow that both reflects the circumstances and stakes of the particular case and meets the privilege obligations imposed by governing law, court orders, or agreements with opposing counsel (see Structure an Internal Workflow for Privilege Review).
For more information on how to assert and show that the privilege and work product protections apply, the factors counsel should consider when preparing a privilege log, and when redaction of documents is appropriate, see Practice Note, Attorney-Client Privilege and Work Product Protection: Procedural Issues (Federal): Asserting Privilege Claims.
Methods for Simplifying Privilege Logs and Protecting Against Inadvertent Disclosure
At the outset of the discovery process, before any privilege review begins, counsel should consider exploring methods for simplifying privilege logging requirements and protecting against inadvertent disclosures of privileged information (see Simplify Privilege Logging Requirements and Limit the Impact of Inadvertent Disclosures). Counsel should next determine whether opposing counsel will stipulate to these requests or if judicial relief will be required to accomplish these objectives.
Addressing these issues early in the case ultimately helps counsel develop a more efficient internal review workflow (see Structure an Internal Workflow for Privilege Review).
Simplify Privilege Logging Requirements
Under Federal Rule of Civil Procedure (FRCP) 26(b)(5)(A), a party who withholds otherwise discoverable communications and documents based on the attorneyclient privilege, work product protection, or other applicable privilege or protection must identify the withheld materials on a privilege log. The privilege log must provide key details about the information asserted as privileged so that the adversary may substantiate the claims (FRCP 26(b)(5)(A)(ii)). For a sample privilege log that parties can use in federal civil litigation, see Standard Document, Privilege Log.
Yet privilege logs are considered a bane in litigation by nearly all stakeholders (see Kevin F. Brady, Top 10 Things You Never Hear on Privilege Logs, Law Technology News, Jan. 10, 2013 (”Judges don’t want to hear about the disputes or do any in camera review. Partners do not want to oversee the work on the log and associates don’t want to be bothered with such mundane tasks. Clients don’t want to pay significant amounts of money for something that poses only risk and no reward.”))
While parties must satisfy the requirements of FRCP 26(b)(5)(A), they should seek ways to simplify their privilege logging process. The exponential growth of ESI has resulted in privilege logs that are lengthy, unwieldy, and not very useful. Counsel can minimize the burdens associated with preparing a privilege log by negotiating a stipulation with opposing counsel that limits the scope of the parties’ obligations. Indeed, the FRCP encourage counsel to explore possible limitations on their privilege log obligations at the meet and confer under FRCP 26(f). Specifically, parties must develop a discovery plan that addresses “any issues about claims of privilege or of protection” (FRCP 26(f)(3)(D)). For a sample report and discovery plan that parties can use to memorialize the results of their meet and confer, see Standard Document, Rule 26(f) Report and Discovery Plan. For more information on the topics counsel should be prepared to discuss at the meet and confer, see Rule 26(f) Conference Checklist.
In determining what information should be identified on the log, counsel should be aware that they may not need to share details regarding every fragment of data that is privileged. The FRCP advisory committee notes confirm that divulging specifics regarding the who, what, when, where, and why of a privileged communication “may be appropriate if only a few items are withheld.” By contrast, where counsel withholds many documents as privileged, disclosing that level of detail “may be unduly burdensome.” (FRCP 26(b) advisory committee’s note (1993 amendment).)
In some cases, counsel may agree to eliminate the privilege log altogether rather than try to restrict the logging requirements. In other cases, counsel may propose limitations, such as categorical logging, metadata logs, or sample logs.
- Categorical Logging
In a categorical (or category-based) privilege log, a single entry covers multiple documents of the same category, rather than the traditional approach of entering each withheld document separately. The objective behind the categorical approach is to “create a set of natural differentiations among documents so the parties can say … what is true of items within the category is true of the whole.” The documents can be categorized in “any manner of reasoned organization,” such as by:
- Subject matter.
- Date range.
- The name or type of author, sender, or recipient.
(See Hon. John M. Facciola & Jonathan M. Redgrave, Asserting and Challenging Privilege Claims in Modern Litigation: The Facciola-Redgrave Framework, 4 Fed. Cts. L. Rev. 19, 45 (2010).) Courts generally endorse categorical logs as long as they offer sufficient details about “the nature of the documents, communications, or tangible things not produced or disclosed” to enable adversaries to evaluate claims of privilege (Fed. R. Civ. P. 26(b)(5)(A) (ii); see Rekor Systems, Inc. v. Loughlin, 2021 WL 5450366 (S.D.N.Y. Nov. 22, 2021)).
- Metadata Logs
Metadata logs have come into vogue over the last several years as litigants have looked for methods to both streamline the logging process and expedite completion of the log. Metadata logs can satisfy Rule 26(b)(5)(A)(ii)’s requirements by automating the generation of a log’s content from the metadata corresponding to documents claimed as privileged. For example, an e-discovery platform can lift key details from electronic communications (including sender and recipient information, the date and time of communications, and the communication subject matter) and automate the placement of that information into a log. The speed at which this information is generated is one of the most attractive features of metadata logs. There are drawbacks, though. For example, the producing party should consider manually scrutinizing the subject matter descriptions to ensure those descriptions do not reflect privileged information that should not be disclosed to adversaries. In addition, courts have required parties to include more meaningful subject matter descriptions where the metadata fails to provide sufficiently detailed descriptions of privileged documents (see, for example, Am. Mun. Power, Inc. v. Voith Hydro, Inc., 2020 WL 5014914, at *12 (S.D. Ohio Aug. 25, 2020); Royal Park Invs. SA/NV v. Deutsche Bank Nat’l Tr. Co., 2018 WL 10038859, at *1 (S.D.N.Y. Sept. 28, 2018)).
- Sample Logs
A sample log allows the parties and, if necessary, the court to evaluate a privilege log reflecting a representative sample of documents from the producing party’s overall universe of privileged information. Useful in cases involving voluminous privileged documents, a sample log provides a potentially cost-effective and efficient vehicle for resolving disputes over representative claims of privilege by applying determinations made to representative documents to the balance of the materials the producing party claims as privileged (see Las Vegas Sun, Inc. v. Adelson, 2022 WL 292976 (D. Nev. Feb. 1, 2022)).
Seek a Protective Order
Where opposing counsel refuses to entertain a simplified logging process, or the two sides are otherwise unable to reach an agreement on their privilege logging obligations, counsel can seek a protective order from the court. When making a motion for a protective order, counsel should keep in mind that demonstrating the undue burden of traditional privilege log obligations will likely turn on:
- Whether a court views the approach as being reasonable and proportional to the needs of the case (see U.S. Bank Nat’l Ass’n v. Triaxx Asset Mgmt. LLC, 2021 WL 4973611, at *2 (S.D.N.Y. Oct. 25, 2021)).
- The nature of the meet and confer with opposing counsel.
- Counsel’s credibility with the court and adversaries.
The court may also help in fashioning an acceptable protocol. Regardless of the proposed method, a party who seeks to reasonably narrow the scope of its log may receive judicial approval since courts are generally watchful for opportunities to decrease privilege burdens and enable the “just, speedy, and inexpensive determination” of a particular case (S.D.N.Y. and E.D.N.Y. L. Civ. R. 26.2(c) & committee note (effective Oct. 15, 2021))
Limit the Impact of Inadvertent Disclosures
While inadvertent production of privileged information is not unique to the digital age, it has assumed increased significance in contemporary practice. The amount of ESI now residing in most corporate electronic information systems makes it generally cost prohibitive for counsel to conduct an intensive, document-by-document privilege review, and it is inevitable that some amount of privileged information will be produced.
Inadvertent disclosures are concerning primarily because litigation adversaries will likely raise arguments that the client has waived privilege over that document and those like it. While FRE 502(b) permits a party to avoid waiving the privilege in the event of an inadvertent disclosure, the producing party must meet a somewhat difficult standard to establish inadvertence as a matter of law. Satisfying that standard includes demonstrating that the producing party’s efforts to prevent the disclosure and rectify the error (after learning of the inadvertent production) were reasonable.
To avoid the risk of waiver, counsel should seek a non-waiver order from the court. In state court litigation, counsel may invoke specific rules or procedures or simply move for a protective order, depending on the court. In federal court, the vehicle for obtaining a non-waiver order is FRE 502(d). A 502(d) Order provides that the disclosure of attorney-client privileged or work-product protected information does not waive the privilege or protection in the pending case, or in any other federal or state proceeding. For a sample 502(d) Order that parties can use in federal civil litigation, see Standard Document, FRE 502(d) Order.
In contrast to the process contemplated by FRE 502(b), a properly drafted 502(d) Order eliminates the need for counsel to show that a disclosure was inadvertent as a matter of law. Instead, counsel may simply demand that an adversary return or destroy the mistakenly produced materials. While adversaries may still challenge the claim of privilege, a 502(d) Order can foreclose any argument that a document’s mistaken production resulted in a privilege waiver. As a result, 502(d) Orders generally reduce the expense and risk of litigation over mistaken disclosures of privileged information.
The best and most expeditious way to obtain a 502(d) Order is to execute a claw-back agreement with opposing counsel reflecting this process and then have the court enter it as a 502(d) Order. Even if opposing counsel declines, however, courts are generally amenable to entering 502(d) Orders (see, for example, The Sedona Conference Commentary on the Effective Use of Federal Rule of Evidence 502(d) Orders, 23 SEDONA CONF. J. 1 (forthcoming 2022)).
Counsel should make sure that the terms of a 502(d) Order clearly indicate that FRE 502(b), including its inadvertence standard, does not apply to any waiver determination. Because courts rely on the precise language of the order to determine the rights and obligations of the parties, 502(d) Orders that include the reasonableness factors from FRE 502(b), or that otherwise equivocate on how mistaken disclosures should be resolved, might be construed as 502(b) orders (see Standard Document, FRE 502(d) Order: Drafting Notes: Scope of Protection and Superseding the FRE 502(b) Default Standard and generally the forthcoming Sedona Conference Commentary on the Effective Use of Federal Rule of Evidence 502(d) Orders at 54-55 (providing a sample 502(d) Order)).
Structure an Internal Workflow for Privilege Review
After reaching agreement with opposing counsel or obtaining a court order on privilege logging requirements and the procedure for addressing inadvertently produced documents, counsel should design an internal privilege workflow that is consistent with the established framework. While no review process is identical, there are certain steps counsel can take that are likely to yield better results. For example, counsel should:
- Tailor the level of privilege review to the needs of the particular case and the client’s sensitivities (see Tailor the Review).
- Adopt a top-down approach to the privilege review process (see Adopt a Top-Down Approach).
- Ensure that service providers understand and support the client’s review objectives (see Ensure Support from Vendors).
Tailor the Review
Counsel should determine early on how much attention a privilege review warrants in the particular case. This is because not every privilege review merits equal treatment. In smaller matters or cases where privilege issues are relatively inconsequential, counsel should consider scaling back the resources that would otherwise be deployed in a robust privilege review, while still ensuring that key privileged materials are protected. This might involve limiting the number of review cycles or choosing different analytics tools based on the demands of the case. For information on how counsel might structure the review, see Practice Note, Document Responses: Document Review Overview: Review Phasing.
Counsel should obtain approval from the client for the contemplated privilege review process. By discussing the specific options for the privilege review, analyzing their merits, and sharing estimated budgets for each approach, counsel can better position the client to make informed decisions about the proposed process. Additionally, these discussions may unearth client sensitivities or additional privilege concerns that counsel had not previously considered.
Adopt a Top-Down Approach
Counsel should consider adopting a top-down approach to govern the privilege review, where a team leader provides formal direction at the outset of the review process. This approach contemplates uniform direction on both legal and factual matters to obtain more consistent privilege designations from the team. (See Practice Note, Document Responses: Document Review Overview: Reviewer Training.)
Some privilege reviews follow a bottom-up approach, where individual members of the review team unilaterally apply their understanding of the law and facts to make privilege decisions. This method can lead to inconsistent privilege decisions, with results that are both overinclusive (where too many non-privileged documents are claimed as privileged) and underinclusive (where too many privileged documents are inadvertently disclosed to an adversary). While both scenarios are problematic, underinclusive reviews are particularly troubling because they provide opposing counsel with snapshots of privileged communications, even if those materials are destroyed or returned under a 502(d) Order or claw-back agreement.
In contrast, a top-down approach usually involves formal direction from the team leader at the outset of the review process through an initial and then recurring team meetings (depending on the length of the review) and a formal memorandum for the review team. At a minimum, counsel should identify for the review team:
- The pertinent facts.
- Pressing issues in the case.
- Specific privilege issues that reviewers should keep in mind while conducting their review.
Additionally, a top-down approach requires uniform and consistent guidance on the governing law. The privilege law for particular issues may vary from state to state, in addition to several differences between federal common law and the states. Understanding which law applies in a given case (including the predicate choice of law analysis) can prevent questions that could subsequently arise if the wrong law is applied by the review team. (See, for example, David M. Greenwald, Robert R. Stauffer & Erin R. Schrantz, Testimonial Privileges § 1.69 (3d ed. 2015) (under FRE 501, discussing uncertainties on which jurisdiction’s privilege law should be applied in a particular case).
Ensure Support from Service Providers
A logical corollary to adopting a top-down approach is ensuring that service providers support the review process. Counsel should:
- Carefully review the provider’s intended process for the privilege review. Counsel and the provider should discuss the privilege process agreed to with the client and the analytics tools and pricing needed to achieve that process. Where the provider is supplying the review team, counsel should ensure that the reviewers are properly trained and supervised and otherwise satisfy best practices for engaging document review attorneys. For information on the main issues counsel should consider during the process of retaining an ESI provider, see the Practice Note, Choosing Outside E-Discovery Service Providers and Questions to Ask a Prospective E-Discovery Vendor Checklist. For information on ethical considerations for outsourcing document review, see Practice Note, Ethical Issues for In-House Counsel: Outsourcing Legal Services.
- Specify the nature and format of the privilege log at the outset. Rather than deferring to the standard privilege log template the provider usually uses, counsel should clearly explain to the provider the required content of the privilege log under the applicable law or agreements with adversaries. This discussion can eliminate the need for counsel to substantially rework the log after it is created by the provider.
- Regularly evaluate metrics on the review. This analysis can help counsel gauge review accuracy and speed among the review team and ultimately lead to greater accountability for the provider. (See Standard Document, Document Review Progress Report.)