D R U G A N D M E D I C A L D E V I C EStaying in the GameBy Kelly E. Jonesand Daniella D. DaCunzoE-Discoverywith aLive ProductIn cases involving activelymarketed products,counsel must not onlyreinforce litigationholds, but also keeptrack of changes andavoid disclosure of allthings privileged.Despite the vast number of prescription and over-thecounterdrugs involved in litigation today, only a smallpercentage of those lawsuits involve products that havebeen recalled or withdrawn from the market. A recalledor no longer marketed product allows counselto sequester all potential litigation discoverymaterials at one point in time andgive appropriately measured considerationto newly created documents. In contrast,preserving and collecting electronicallystored information (ESI) in litigation presentscounsel with special challenges whenthis information involves a “live” product,meaning a product currently on the market.A live or actively marketed product requirescounsel to “stay in the discovery game” bycontinually supplementing discovery productions,often with imminent deadlines,without hindering a company’s daily functions.This article will address some of thesteps that counsel should consider whenconducting discovery for “live” products.Makers of actively marketed pharmaceuticaland medical device products may facelitigation while still in the process of modifyinglabels or designing an actual productat issue. In those cases, regulatory counselmust address regulatory issues at thesame time as liability counsel reviews documentsfor discovery purposes. <strong>The</strong>se activities,together with a company’s ongoingmanufacturing efforts, generate numerousdocuments and ESI, creating an enormouschallenge. Counsel and a client must preserverelevant information and ensure thatthe collection process is as complete as reasonablypossible. To ensure faithful adherenceto the rules of ESI discovery, counselmust understand their duties and follow thesteps outlined below.Rules of the Game: Discovery UnderPension Committee and ZubulakeJudge Shira Scheindlin, author of the significante- discovery opinions in the Zubulakecases, has recently rearticulatedcounsel’s e- discovery duties in PensionComm. of the Univ. of Montreal PensionPlan v. Bank of Am. Sec., LLC, 685 F. Supp.2d 456 (S.D.N.Y. <strong>2010</strong>), holding that partiesmust “participate meaningfully andfairly” in the discovery process. Id. at 463.32 n <strong>For</strong> <strong>The</strong> <strong>Defense</strong> n <strong>October</strong> <strong>2010</strong>■ Kelly E. Jones and Daniella D. DaCunzo are associates of Harris Beach PLLC in New York City and aremembers of the firm’s e-info electronic information counseling and management team. <strong>The</strong>y both primarilylitigate and consult in cases involving pharmaceuticals and medical devices. Ms. Jones is currently theYoung Lawyers liaison to <strong>DRI</strong>’s Drug and Medical Device Committee and the chair of the Young LawyersMembership Subcommittee.
This requires a client and counsel to produce,as well as to preserve, evidence, orface judicial sanction. See id. at 465–66.In the context of ESI, this requires counselto become actively involved in a client’sdiscovery process and to work to ensurethat relevant information is preserved andcollected. See Zubulake v. UBS WarburgLLC, 229 F.R.D. 422, 432 (S.D.N.Y. 2004)(Zubulake V). Counsel must actively participatethroughout the collection and preservationprocess by ensuring that a clientimplements a litigation hold, identifyingand communicating with personnel thatmanage the relevant data, and ensuringthis data is retained and produced for theopposing party. See id.Failure to meet these obligations willresult in harsh penalties. In the discoveryof electronically stored information, thefailure to preserve and adequately searchfor relevant material “inevitably resultsin the spoliation of evidence,” and a courtcan sanction counsel for even careless mistakesthat result from a “pure heart andan empty head.” Pension Comm., 685 F.Supp. 2d at 464 (holding the failure to preserve,collect, and review evidence resultingin loss of relevant data was at leastnegligent). <strong>The</strong>se sanctions can be quitesevere and involve fines, adverse inferencejury instructions, and other costs.See, e.g., Google, Inc. v. Am. Blind & WallpaperFactory, Inc., No. C 03-5340 JF, 2007WL 1848665, at *1, 5–6 (N.D. Cal. June 27,2007) (evidentiary sanction and fine of$15,000 for willful indifference toward discoveryobligations); Phoenix Four, Inc. v.Strategic Res. Corp., No. 05 Civ. 4837, 2006WL 1409413, at *9 (S.D.N.Y. May 23, 2006)(payment of costs of bringing motion andre- depositions for delinquent production ofdocuments); Zubulake V, 229 F.R.D. at 439–40 (adverse inference instruction for failureto preserve e-mails after receiving adequatewarnings). <strong>The</strong>refore, it is important thatcounsel identify the moment when discoveryduties arise and respond effectively.E-discovery obligations present a challengeeven with products that are no longermarketed and involve static informationgenerated from a closed group of key players.Discovery challenges increase exponentiallywith litigation involving liveproducts, as companies juggle compliancewith ongoing regulatory demands,business obligations, and personnel withchanging organizational responsibilities.<strong>The</strong>se challenges require counsel to takeextra steps to respond to changes as theyoccur and to ensure confidentiality andprivilege issues are not compromised.Develop a Strong Offense and<strong>Defense</strong>—Anticipation of LitigationTriggers Counsel’s Duties<strong>The</strong> obligation to oversee a client’s preservationof evidence begins with the anticipationof a lawsuit: “Once a party reasonablyanticipates litigation, it must suspend itsroutine document retention/destructionpolicy and put in place a ‘litigation hold’to ensure the preservation of relevant documents.”Pension Comm., 685 F. Supp. 2dat 466 (quoting Zubulake v. UBS WarburgLLC, 220 F.R.D. 212, 218 (S.D.N.Y. 2003)(Zubulake IV)). <strong>The</strong> beginning of this dutyto preserve evidence often coincides withthe commencement of a lawsuit. But, thisduty “may arise even earlier if a party hasnotice that future litigation is likely.” CacheLa Poudre Feeds, LLC v. Land O’Lakes Inc.,244 F.R.D. 614, 621, 622–23 (D. Colo. 2007)(holding that a party’s duty to preserve wastriggered by filing a complaint rather thanby pre- filing correspondence); see Goodmanv. Praxair Servs, Inc., 632 F. Supp. 2d494, 511 (D. Md. 2009) (finding that a dutyto preserve was triggered by a letter threateninglitigation). Thus, counsel must beprepared to initiate a litigation hold at veryearly stages of a conflict or face judicialsanction. See, e.g., Doe v. Norwalk Cmty.Coll., D. Conn. 2007 (finding defendantsgrossly negligent for failure to implementa litigation hold upon initial discovery ofsexual assault allegations).Once the duty to preserve begins, counselmust not only help implement a litigationhold but also continually monitora client’s document- gathering process.Implementing a litigation hold is “only thebeginning” of counsel’s duties in the discoveryprocess. Zublake V, 229 F.R.D. at432; see also Cache La Poudre Feeds, 244F.R.D. at 630. Accordingly, it is insufficientto establish a litigation hold and merelycommunicate it to company employees.See Cache La Poudre Feeds, 244 F.R.D. at630 (holding that counsel failed to dischargediscovery obligations by directingemployees to produce relevant informationwithout overseeing and verifying theirproduction). Instead, counsel has a dutythroughout the discovery process to ensurecompliance with a hold and to oversee andmonitor a client’s efforts to retain and produceESI. Zublake V, 229 F.R.D. at 432; seePension Comm., 685 F. Supp. 2d at 473(holding a counsel’s instruction to plaintiffs,absent active supervision, failed toIt is important thatcounsel identify the momentwhen discovery duties ariseand respond effectively.meet the standard for a litigation hold).Counsel must work with a client to identifyappropriate custodians throughoutthe organization, communicate the holdto employees, interview potential custodiansand IT staff, conduct diligent inquiryof information repositories, suspend routinedeletion protocols, and frame andimplement reliable collection methodologies.See Pension Comm., 685 F. Supp. 2dat 473 n.67 (noting that attorney oversightincludes “the ability to review, sample, orspot-check the collection efforts”).<strong>For</strong> actively marketed products, thisongoing obligation provides unique challengesthroughout the litigation period.<strong>The</strong> “live” status of the relevant productrequires vigilant monitoring of a legal hold,as the product continues to be marketedthroughout litigation. Counsel must providespecific instructions on preservationof metadata and then continually monitorthe performance of a client’s personnel,verifying that a hold directive has beenextended to terminated employees and tonew hires. Attorneys should also implementprocedures that track informationand provide continuing reminders to a client.<strong>For</strong> example, counsel could track holdnotice receipts and confirmations, on paperor electronically, and use a tickler systemto implement a preestablished scheduleto send reminder notices. Counsel couldalso work with a client to schedule frequentreminders to ensure compliance and<strong>For</strong> <strong>The</strong> <strong>Defense</strong> n <strong>October</strong> <strong>2010</strong> n 33
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