August 29, 2007

Lorraine v. Markel American Insurance Co., ____ F.R.D. ____, No. PWG-06-1893, 2007 WL 1300739 (D. Md. May 4, 2007)

Ensuring that e-mails are admissible as evidence in support of a motion for summary judgment may be vital to the success of the motion. In Lorraine v. Markel American Insurance Co., the U.S. District Court for the District of Maryland denied Motions for Summary Judgment, without prejudice to re-file, based on each party's failure to ensure the admissibility of their proposed e-mail evidence in support of their petitions to enforce an arbitrator's award. Chief Magistrate Judge Paul W. Grimm's opinion provides a detailed and thoughtful approach to the necessity of ensuring that e-mails are admissible evidence for summary judgment under Federal Rule of Civil Procedure 56(e) as well as at trial. Whether Electronically Stored Information is admissible depends on an analysis of the applicability of a number of Federal Rules of Evidence: relevance (Rule 401), authenticity (Rule 901(a)), hearsay covered by an exception (Rules 801, 803, 804 and 807), originals or duplicates (Rules 1001-1008) and whether the probative value outweighs the possible prejudice (Rule 403).

In making the analysis, the court directed particular attention to the parties' failure to attempt any authentication of the critical e-mails. The party offering the document into evidence need only make a prima facie showing of the authenticity of the document. The court noted that while the standard is relatively low, counsel often fail to meet even this "minimal showing." Judge Grimm referred to this omission as a "self-inflicted injury which can be avoided by thoughtful advance preparation."

E-mails are the most frequent form of ESI that practitioners encounter. The lack of formality of e-mails coupled with their creation at or near critical events makes them frequent fodder as evidentiary exhibits. This fact is particularly true when proof requirements consist of state of mind, intent or motive. As with hard-copy evidence, direct or circumstantial evidence may be used for authentication. E-mails may be self-authenticating under Fed. R. Evid. 902(7) if, as with many business e-mails, the e-mail has a tag identifying the company-employer and the origin of the e-mail. The address of the sender, however, may be insufficient alone to authenticate a document since there can be unauthorized use of the computer. A person with personal knowledge of the sending or receiving of the e-mail may need to testify to provide adequate authentication.

Judge Grimm's opinion relies on newly amended Federal Rules of Evidence and provides guidelines for the admission of ESI, including authentication and overcoming hearsay objections. While the court went to great lengths to provide detailed paths to admissibility, practitioners should not overlook that stipulations or request for admissions under Fed. R. Civ. P. 36 can be employed to satisfy the requirements or to at least narrow the scope of the controversy. In the Lorraine case, counsel simply attached the exhibits to their Motions for Summary Judgment without any affidavits. This left the court without recourse other than to dismiss the motions. While acknowledging that e-mails and instant messages create authentication challenges, Judge Grimm rejected the need for a new legal framework to address the authentication of these and other forms of ESI.

Internet Web site postings and chat rooms create unique obstacles to authentication, since these sites often consist of postings of third parties that may not be within the control of the sponsor of the Web site. The authentication issues focus on whether the exhibit accurately reflects the Web posting and whether the owner is actually responsible for the postings.

In the case of chat rooms, messages consist of "conversations" by identified "screen names." If the intention is to introduce the exhibit against the purported owner of the screen name, circumstantial evidence, including unique identifiers in the screen name or text of the message, can be used. Text messages encounter the same authentication foundation issues. Fed. R. Evid. 901(b)(1) (witness with personal knowledge) or 901(b)(4) (distinctive characteristics of messages).

Computer animations and simulations raise unique evidentiary challenges. As demonstrative evidence, computer-generated animations raise issues common to the use of photographs, both conventional and digital, in that the animations must fairly portray the facts and illustrate the witnesses' testimony. In contrast, computer simulations in which the computer is used to analyze data and draw conclusions need an additional scientific foundation before admissibility, using a witness with knowledge not only of the program software but also of the data used in the calculation and the reliability of that data. A witness with personal knowledge or an expert may be used. Fed. R. Evid. 901(b)(1) and 901(b)(3).

Computer-stored records and data are the easiest to authenticate. While questions can arise from incorrect data entry or operation of the computer program, some courts have ruled that it goes to the weight of the evidence, not admissibility. See, e.g., U.S. v. Meienberg, 263 F.3d 1177, 1180-1181 (10th Cir. 2001). Other courts have taken a more restrictive view, insisting on focusing not on the creation of the records, but on the maintenance of those records once created. The policies and procedures for the use of equipment, databases and programs must be established, as well as the use of backup systems, to ensure the accuracy of the data to be introduced.

The court also addressed the applicability of the hearsay rules in the context of ESI. While much of the hearsay analysis for ESI, as well as the application of exceptions, is identical to that made for hard-copy documents, there are some applications that may be of particular relevance to ESI. Certain communications, such as those between the parties to a contract that prove the terms of the contract, are not considered hearsay because they are not "statements," but rather "verbal acts" or "legally operative facts," according to Judge Grimm. Thus, e-mails containing instructions, the contract or letters from an attorney relating to formation of the contract have all been considered non-hearsay.

The plethora of exceptions to the hearsay rule, including prior inconsistent statements (Fed. R. Evid. 801(d)(1)), admissions of a party opponent (Fed. R. Evid. 801(d)(2)), present sense impression (Fed. R. Evid. 803(1)), excited utterance (Fed. R. Evid. 803(2)), state of mind (Fed. R. Evid. 803(3)) and public records (Fed. R. Evid. 803(8)) as well as business records (Fed. R. Evid. 803(6)), are all available and applicable to ESI. Many litigants erroneously believe that an e-mail created by an employee on the employer's business computer qualifies the e-mail as a business record.

Importantly, the document must not only have been prepared in the course of business contemporaneously (or nearly contemporaneously), but also be based on personal knowledge. Moreover, it must be the regular practice of the business to maintain such a document and not simply the personal choice of the author. These qualifications become even more critical when e-mail chains are offered because many courts insist that each communication in the chain must be separately analyzed.

The Original Writing Rule may also need to be satisfied in order to gain the admissibility of a document containing ESI (Fed. R. Evid. 1001, 1002). This rule might come into play if the contents of the document need to be proved, such as in copyright, defamation and invasion of privacy cases. Because of the ephemeral nature of much of ESI, secondary evidence may be permitted under Fed. R. Evid. 1004. Finally, even after the requirements of relevance, authentication, hearsay and the Original Writing Rule are satisfied, a court is still required under Fed. R. Evid. 403 to balance the probative value of the evidence against the danger of undue prejudice.

While Judge Grimm allowed the parties to re-file their Motions for Summary Judgment without prejudice, this detailed opinion illustrates the pitfalls litigants should avoid when proffering ESI as evidence.

This Alert was authored by Duane Morris eDiscovery Team member Beatrice O'Donnell.

For Further Information
If you have any questions about this Alert or would like more information on eDiscovery, please contact John J. Soroko, John C. Herman, Beatrice O'Donnell, one of the other eDiscovery Team attorneys or the attorney in the firm with whom you are regularly in contact.

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