Various amendments to the Federal Rules of Civil Procedure are taking effect on December 1. Here are my thoughts on how these amendments may impact the defense of class actions:

  • Greater Emphasis on Proportionality: The new Rule 26(b)(1) will expressly limit discovery to that which is “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.” While class actions are generally large and important cases, they can vary widely in the amount in controversy, for example. Defendants can use this change as an important new tool in seeking to limit the scope of the discovery they are burdened with in class actions.
  • Cost-Sharing: The new Rule 26(c)(1)(B) has an express provision for a protective order directing cost sharing for discovery. It will be interesting to see how courts apply this in class actions when defendants seek to shift costs to the named plaintiffs or their counsel (who almost always are funding the litigation).
  • Preservation of Evidence and Clawback Agreements: The new Rule 16 suggests that the initial scheduling order include a provision with respect to preservation of electronically stored information (ESI) and a provision with respect to a clawback agreement under Fed. R. Evid. 502 for inadvertent disclosure of privileged material. These are sometimes but not always included in initial scheduling orders, and generally desirable to have, so that the defendant can be assured that the scope of its litigation hold in a class action is court-approved early in the case.
  • Document Productions: The new Rule 34 allows a party objecting and responding to a document request to specify “another reasonable time” for producing the responsive documents. This should give large corporate defendants some leeway where document productions take longer. Another new provision requires the responding party’s objection to “state whether any responsive materials are being withheld on the basis of that objection.” One thing the new rule seems to overlook on that point, however, is that often a responding party will not know whether there are additional responsive materials because the objection is to the burden of searching beyond a particular scope. I would expect responding parties will state in their objections what they are not searching for, and thus do not know what exists. Hopefully judges will view that as adequate compliance with the new rule.
  • Sanctions for Failure to Preserve ESI: The new Rule 37 narrows the scope of sanctions for failure to take reasonable steps to preserve ESI. An adverse inference instruction or other severe sanction is permitted “only upon finding that the party acted with the intent to deprive another party of the information’s use in the litigation . . . .” This should reduce the stress level when oversights or mistakes are made in the preservation of ESI.

On a related note, if you are interested in a program on strategies for the use of absent class member discovery in defending class actions, my fellow class action blogger Andrew Trask and I are doing a webinar for Stafford on that subject on December 2. I have a small number of free registrations available for clients and friends – if you are interested just e-mail me.