The days of sifting through and producing boxes of documents in response to litigation discovery are—for the most part—long gone. Instead, litigation counsel is more typically preoccupied with the production of electronically stored information, commonly referred to as ESI. The trend toward ESI discovery is certainly being experienced in connection with litigation involving employee benefit plans.

Given the sheer size of many employee benefit plans, the large number of participants and beneficiaries (both actives and retirees) in those plans, and the extensive reporting and disclosure requirements mandated by the Employee Retirement Income Security Act of 1974 (ERISA), it stands to reason that e-discovery in ERISA litigation can be a massive undertaking. And while modern technology helps litigants navigate through the process, there may be difficult strategic choices to make, and risks to confront, along the way. In this article, we highlight some considerations relevant to e-discovery as applied to the litigation of employee benefit disputes.

1. Consider Whether the Requested ESI Is Proportional to the Needs of the Case

Despite its prevalence in litigation, discovery of ESI may not be appropriate in all matters. Rule 26(b)(1) of the Federal Rules of Civil Procedure permits a party to

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....

The collection, review and production of ESI—no matter how small or large the volume of documents—takes time, money and resources, and large productions can quickly become unduly burdensome and costly. Thus, consideration should be given in all cases as to whether the discovery of ESI is proportional to the needs of the case. This is true especially in complex litigations over employee benefits where the volume of documents sought and produced from the plans far exceeds that produced by participants and beneficiaries. In the absence of negotiating effective limitations on the scope of ESI discovery, it is good practice to document the burdens and costs associated with collecting, processing, and producing the ESI. It may help a court resolve a dispute about whether the requested discovery is in fact proportional, or whether to impose cost-sharing, as contemplated by the advisory comments to Federal Rule of Civil Procedure 26(c)(1)(B).

2. Consider the Implications of Self-Collection and Production

In litigation involving employee benefit plans, many of the relevant materials—e.g., plan documents, summary plan descriptions (SPDs), and participant communications—are often readily accessible and their contents are well-known. Although a quick collection and production of these materials via encrypted email may seem harmless, consideration should be given to whether the search for responsive documents has included all appropriate custodial (i.e., people) and noncustodial (e.g., shared drives) sources. The same of course would be true for documents that are less readily accessible.

Consideration also should be given to whether there is a need to preserve metadata. Metadata is data about the data that is being produced, such as the file name, date modified, recipient, etc. In some cases, the failure to preserve metadata may be viewed as spoliation, which could lead to court-imposed sanctions. For example, a court in one case chastised and sanctioned a producing party, stating that their “amateurish collection of documents leading to the destruction of perhaps critical metadata certainly reflects that plaintiff did not take ‘reasonable steps’ to preserve the evidence as required by Rule 37(e).” Leidig v. Buzzfeed, Inc., 16-cv-542 (S.D.N.Y. Dec. 19, 2017).

3. Consider Whether Forensic Data Is Responsive

Many litigators are familiar with discovery of active, electronic documents stored on electronic devices and processed in the applications people use every day, such as e-mail, word processing, shared folders, etc. They may be less familiar, however, with forensic data, which is digital data that exists on a level that is not readily accessible by a lay person, such as the history of activity on a device, click-paths for websites, archived information on back-up tapes, and deleted data and files.

As companies migrate to paperless or semi-paperless operations, analysis and/or discovery of forensic data has the potential to become more relevant. For instance, if a litigant sought to determine whether a mistake was made in completing a benefit enrollment form, she might typically seek draft or discarded copies of the enrollment form, if the enrollment records are kept in hard copy. If an online enrollment system is used, additional information may be stored digitally, such as information on when the online system was accessed, how long the employee was on the page, what she clicked on, etc. Similarly, if an SPD is posted on an intranet page rather than mailed in hard copy, there may be forensic data showing the views of the SPD, and that may be useful for purposes of establishing whether and when a participant had actual knowledge of plan terms.

4. Cautiously Embrace New Technology

Given the ever-increasing volume of ESI, document-by-document, manual review of potentially responsive documents is becoming less and less practical. New technologies may present the means for tackling discovery more efficiently. For example, technology-assisted review (TAR) software allows attorneys to use sample sets of responsive and non-responsive documents to train a computer program to conduct an automated document review.

Over the past several years, TAR has gained popularity as a tool to standardize review and combat the resource demands of a large-scale document review. TAR is not fool-proof, however, and gives rise to an entirely new set of issues, such as whether the reviewing party properly “trained” the review system, how to validate and audit the results of the review, and whether using TAR is even proper at all. See, e.g., Entrata, Inc. v. Yardi Sys., Inc., 15-cv-102 (D. Utah June 20, 2018). Due to the learning curve and new issues associated with TAR and other new technology, litigation counsel are well-advised to learn about these issues before they arise in litigation.

View from Proskauer

As litigation over employee benefits increases in complexity, and the technology used to store, access, process, and produce such information continues to evolve, an effective discovery plan should devote considerable attention to issues pertaining to the discovery of ESI. Indeed, Rule 26(f)(3)(C) of the Federal Rules of Civil Procedure requires the parties to discuss ESI during their initial planning conference. The issues may seem daunting to some, but there is no expectation of perfection in responding to discovery; rather the federal rules require reasonable and proportional responses. Thus, best practices militate in favor of staying abreast of new advances so that when litigation arises reasonable and informed decisions on how to handle e-discovery can be made.

Lindsey Chopin is an associate in the Labor & Employment Law Department and a member of the Employee Benefits & Executive Compensation Group at Proskauer Rose, focusing on complex employee benefits litigation.