• Rachel Mentz

What Proportional Really Means in Discovery

Updated: Mar 4

It's Not Just One Thing - FRCP 26 in Federal Civil Litigation

Book case to the Sky - looking for Proportionality

Proportionality is a key consideration to the appropriate scope of discovery in federal courts and elsewhere. But whether something is proportional depends on the circumstances. The word does not mean just one thing. Rather, this in-depth article explains the six key factors to determining what discovery is proportional. It also explores hypothetical and actual examples.

For a quick checklist of arguments to make for and against proportionality in discovery, see 11 Arguments For Proportionality and 15 Arguments to Make Against Proportionality

Six Factors to Proportionality

The six key factors are:

- the importance of the issues at stake in the action;

- the importance of the discovery in resolving the issues;

- the amount at stake;

- the parties’ relative access to relevant information;

- the parties’ resources; and

- whether the burden or expense of the proposed discovery outweighs its benefit.

Proportionality was always intended to be part of the analysis of what type of discovery is permissible.

Proportionality Amendment to FRCP 26

In 2015, Rule 26(b)(1) of the Federal Rules of Civil Procedure (FRCP 26) was amended to expressly refer to proportionality as a necessary factor in determining the scope of discovery in federal court.

The comments to the 2015 amendments make clear that proportionality was always intended to be part of the analysis of what type of discovery is permissible.

Including proportionality as part of Rule 26 has gone a long way to reshaping the language used around the discovery process, including how parties and courts handle eDiscovery. No longer is it acceptable to justify discovery by merely showing it is relevant. "An assessment of proportionality is essential." Motorola Solutions, Inc. v. Hytera Communications Corp., 365 F. Supp. 3d 916, 924 (N.D. Ill. 2019).

For an overview of the eDiscovery process, check out my Ultimate Guide to eDiscovery.

The current version of Rule 26(b)(1) states:

Scope in General. Unless otherwise limited by court order, the scope of discovery is as follows:

Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.

Information within this scope of discovery need not be admissible in evidence to be discoverable.

(emphasis added).

The key factors of proportionality and undue burden guide the scope of discovery

Now, in addition to relevance, the key factors of proportionality and undue burden guide the scope of discovery. In evaluating whether certain discovery is proportional, courts consider:

- the importance of the issues at stake in the action;

- the importance of the discovery in resolving the issues;

- the amount at stake;

- the parties’ relative access to relevant information;

- the parties’ resources; and

- whether the burden or expense of the proposed discovery outweighs its benefit.

It is up to the party resisting discovery to show how the requested discovery is overly broad, unduly burdensome, or oppressive by submitting affidavits or offering evidence revealing the nature of the burden. See Merrill v. Waffle House, Inc., 227 F.R.D. 475, 477 (N.D. Tex. 2005).

Considering these factors, "[a] court can—and must—limit proposed discovery that it determines is not proportional to the needs of the case, . . . [and] must do so even in the absence of a motion." Samsung Electronics America Inc. v. Yang Kun “Michael” Chung, 325 F.R.D. 578 (2017).

Importance of the Issues at Stake in the Action

The type of action involved and the specific types of substantive issues at stake play a role in determining whether the discovery sought is permissible.

For example, in Garcia Ramirez v. U.S. Immigration & Customs Enf't, 331 F.R.D. 194, 196 (D.D.C. 2019), the court determined that it was proportional to order federal agencies to produce relevant documents from sixteen additional custodians after the government had already produced ESI from eighteen custodians.

The dispute involved the alleged failure of Immigration and Customs Enforcement to consider the least restrictive setting, as statutorily required, in transferring young adults who had arrived in the United States as unaccompanied minors to adult detention facilities.

Even though the plaintiffs did not seek monetary damages, the Court held the discovery was proportional given the importance of the issues at stake.

“[T]his litigation is vitally important to the welfare of numerous teenagers, there is a large information disadvantage between the parties, [the government’s] resources are not unnecessarily strained, and discovery is important in resolving the underlying issues.” 331 F.R.D. at 199.

Courts, therefore, may be more likely to order additional discovery when the issues are especially important.

Importance of the Discovery

In many cases, the parties serve scattershot and incredibly broad discovery requests with the goal of trying to make sure that they get everything on a particular topic.

Often, these requests are impermissibly overbroad. They also tend to seek information that is not actually very important to the dispute.

Keep in mind that broad discovery requests can also lead to the unintended consequence of the responding party producing everything under the sun in a data dump of ESI that has minimal if no actual relevance to the the dispute. It is hard to successfully object to an over-production when the requests leading to it were so overbroad to begin with.

A party should always be able to explain why the discovery sought is important to the needs of the case.

Hypothetical: Finding Important Discovery in Breach of Contract Dispute

For example, consider a breach of contract dispute regarding performance under a high-volume sales contract over a two-year period. There are disputes regarding timely payments and a dispute over prices charged.

You could ask for "all documents regarding the DATE contract between Party X and Party Y". But not all documents regarding the contract are likely important.

There might be a huge volume of mundane irrelevant e-mails between your adversary's employees about ordering materials to produce orders when those orders and the quality of the items are not issues in the case.

There also could be thousands of internal and external e-mails from employees of the shipping and receiving department regarding fulfilling and shipping orders when the fulfillment of orders is not an issue in the case.

An overbroad request for production can easily balloon review costs for the client.

A broad discovery request could yield production of a huge volume of documents that are indeed "regarding the contract", and which now must be analyzed for review, but they are not all important. This type of request can easily balloon review costs for the client.

Discovery costs ballooning after receiving huge production of documents

A better approach could involve investigation with the client or through a tiered discovery approach to determine who at the adversary's company actually handled the specific payment and pricing issues in the dispute.

Using information from your client and information from your client's own documents, you could learn that only two people from the opposing party's company appear to have primarily handled the issues in the dispute.

You may also learn that the client suspects from communications with these two individuals that the CEO was also involved as the ultimate decision-maker.

If your client does not know much about who at the adversary's company was involved, you could instead serve interrogatories early in the case to find out this type of information.

It is wise for attorneys to carefully investigate with their client where likely evidence will be found

To serve a more narrowly tailored request, you could seek:

"documents from Custodian A, Custodian B, and Custodian C regarding payments made and the prices charged under the DATE contract between X and Y".

This discovery request is much narrower and focused and more likely to identify the important information to the dispute.

Sampling of Proposed Discovery

You might also push for a sampling of documents from other custodians so that you can get a sense of what types of relevant information that custodian actually has. By agreeing to a set of search terms to be applied to the custodians’ data, a random sampling of documents obtained may give you the information you need to advocate for additional ESI to be produced.

If, from the discovery produced, you learn that other people were involved and likely have key information, you can serve follow-up discovery requests that are targeted at that information.

A sampling approach was ordered in Ad Astra Recovery Servs., Inc. v. Heath, No. 18-1145-JWB-ADM, 2019 WL 4466903, at *1 (D. Kan. Sept. 18, 2019). The case involved a debt collector’s claims against defendant attorneys who ran a credit repair business that allegedly bombarded the debt collector with false credit dispute letters. The debt collector sought fifty of the lawyers’ audio recordings with clients.

The lawyers argued the discovery would pose an undue burden because of how time-consuming it would be to download and review the recordings for responsiveness and privileged communications. The lawyers estimated it would take more than 200 hours to conduct the review. Id. at *4.

Because the audio recordings appeared to be of “some importance” in resolving whether the clients had consented to sending the credit dispute letters, the court ordered review and production of a sampling of ten of the fifty recordings to determine whether the recordings were sufficiently important to resolving the issues at stake. Id.

The court noted that for additional recordings to be produced, the sampling must establish the audio recordings were not unreasonably cumulative of information, such as paralegal notes of the conversations, that had been previously produced. Id. at *5.

It is wise, therefore, for attorneys to carefully investigate with their client where likely evidence will be found in their adversary's documents to weigh whether the information they are seeking is narrowly tailored and likely to be important to the specific issues in the dispute.

Amount at Stake

While the comments to Rule 26 are clear that the amount at stake in the litigation is not determinative to the amount of discovery permissible, it is a consideration that courts take into account.

It often does not make sense to engage in significant eDiscovery when there is not a great deal of money at stake.

Money at stake in a dispute is an important factor to proportionality.

Looking at the above breach of contract case study, if the dispute under the contract is only worth $50,000, it likely does not make sense to seek all documents from three custodians regarding payment and price under the contract over a two-year period.

A better approach may be to focus on documents from those three custodians related to specific orders over a narrower, specific date range.

If you have a key e-mail from your client that was sent to the adversary regarding the pricing and payment, you could ask for all documents from your adversary from the three custodians that specifically relate to the issues identified in your client's e-mail.

On the other hand, just because millions of dollars are at stake does not mean the court will permit extremely extensive discovery.

In Motorola Solutions, Inc. v. Hytera Communications Corp., 365 F. Supp. 3d 916 (N.D. Ill. 2019), the court declined to order the forensic inspection of computers from China in a multi-million-dollar dispute regarding alleged copyright infringement and theft of trade secrets.

The defendant had already produced two million documents, totaling approximately 20 million pages. The court found the plaintiff’s motion seeking a forensic inspection of the laptop was cumulative and “discovery overkill”. Id. at 923. The plaintiff admitted it had already found significant evidence in support of its claims. Id. at 926. “The discovery rules are not a ticket to an unlimited, never-ending exploration of every conceivable matter that captures an attorney’s interest.” Id. at 925.

The fact that there appeared to be 100 relevant missing e-mails from defendant’s production, and that plaintiff had not yet been able to determine the specific identity of the custodian of of the pirated code that had been found, did not warrant the additional discovery. Id.

“Forensic examination of a party’s computer’s, even on American soil, is no routine matter.” Id. at 925. The Court also noted it would be difficult, if not impossible, to obtain a forensic inspection under Chinese law. Id. at 923, 928-29. And, in any event, the forensic inspection could not be completed by the discovery cut-off deadline.

Relative Access to Relevant Information

Access to relevant information is a factor that attorneys often overlook.

It is sometimes the case that both the client and the adversary have similar access to certain types of relevant information. It may be cheaper and easier to find that information by looking at your client's own documents or seeking it from a third party than trying to obtain it from your adversary or vice versa.

A court will be unlikely to require the adversary to bear the expense of collecting, reviewing, and producing this type of ESI if your client has similar access to the information.

A court could require the requesting party to pay for some or all of the costs associated with the adversary's collection, review, and production of the data.

For example, imagine that you are seeking relevant information that you suspect is in a large volume of e-mails between your client, your adversary, and a third party.

You could serve discovery requests on your adversary seeking these e-mails. Alternatively, or, in addition, you could look for them in your client's own data or even seek them by subpoenaing the third party.

If you insist on obtaining the adversary's copies over the adversary's refusal, a court will likely consider each party's relevant access in determining whether the adversary has to produce its copies of the e-mails.

Production could be required if, for instance, it is less expensive or not very burdensome for the adversary to produce the documents while your client will incur significant costs and burden to do so. But you will need to convince the judge why.

If the source of the data is damaged, there may be a basis for seeking the discovery elsewhere.
Broken laptop impacts relative access to relevant information in discovery

If your client cannot access the documents without having to recover damaged or archived data, such as from legacy servers, inoperative laptops and hard drives, or tape backup, there may be a basis for seeking the discovery elsewhere.

A court might order the adversary to produce the documents in these circumstances if your adversary can easily find its copies of the documents, without incurring significant costs.

Cost-shifting might be appropriate. The court could require the requesting party to pay for some or all of the costs associated with the collection, review, and production.

Parties' Resources

Courts often consider the resources of the parties in determining whether to allow certain discovery.

If one of the parties lacks substantial resources, a court may weigh the lack of resources with the other proportionality factors and be unwilling to order the discovery. The comments to Rule 26 state that, "[t]he burden or expense of proposed discovery should be determined in a realistic way."

While courts do consider the parties' resources in evaluating the appropriate scope of discovery, it is not a determinative factor. The comments to Rule 26 further state:

"[C]onsideration of the parties' resources does not foreclose discovery requests addressed to an impecunious party, nor justify unlimited discovery requests addressed to a wealthy party. . . .

[T]he court must apply the standards in an even-handed manner that will prevent use of discovery to wage a war of attrition or as a device to coerce a party, whether financially weak or affluent."

Burden or Expense of the Proposed Discovery Weighed Against Benefit

Finally, the last factor to assessing proportionality is the explicit cost-benefit analysis of the burden of the proposed discovery against its likely benefit. Inherent in considering all of the other factors is this ultimate analysis.

Does it make sense to do this type of discovery given how much it will cost?

eDiscovery costs associated with collecting, reviewing, and producing certain types of documents can easily dwarf the other costs of litigation.

To control eDiscovery costs, it is essential to understand up front what the likely discovery expenses will be. If the information to be gathered has minimal importance to resolving the issues between the parties, it may not be worth it to conduct the discovery at all.

Being able to present detailed cost or other information to be able to convince a court that the proposed discovery would in fact pose an undue burden to your client is crucial.

In Garcia Ramirez, discussed above, the government failed to show undue burden associated with producing ESI from sixteen additional custodians, entailing review of roughly 144,000 additional documents, even though it had previously produced ESI from eighteen custodians. 331 F.R.D. at 198.

The court focused on the fact the government had not provided any evidence or specific factual allegations to support their claim the discovery imposed an undue burden.

The court pointed to the fact that the ESI for the additional custodians had already been gathered and searched. And the government failed to address the plaintiffs’ assertion that “de-dupe” and active learning technology could be used to prevent the unnecessary review and production of documents that had previously been reviewed and produced. Id.

Disclaimer: The statements expressed in this posting are my own and are for general informational purposes only and do not constitute legal advice or a legal opinion.

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Rachel Mentz

Attorney author Rachel Mentz is an eDiscovery Consultant, blogger, and commercial litigator. Find her at www.mentz-law.com/about
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