Document Preservation, Collection and Production Obligations

Originally published by the Daily Journal of Commerce on September 19, 2024.

Whether a construction dispute is subject to arbitration or court litigation, the parties to the dispute will most likely engage in a process to exchange their project files, project-related emails, and a myriad of other project-related documents relevant to the dispute. While this process is not unique to construction cases, the fulsome exchange of documents is particularly critical to fairly resolving them because the story of a construction dispute is almost always told through the emails and other communications between and among the various project participants. Construction lawyers are well-versed in the issues this presents, particularly in the era of electronically stored information (“ESI”). Nonetheless, owners, design professionals, and contractors would all benefit from even a rudimentary understanding of the process and their obligations.

The first step is to ensure that potential evidence is not destroyed. The law imposes an affirmative obligation to preserve evidence even before litigation or arbitration is under way—often at the point litigation or arbitration becomes “reasonably foreseeable.” Evidence subject to the preservation obligation includes not just project-related documents—both in paper form and ESI—but also the physical evidence, including the project itself. The failure to preserve evidence could result in harsh civil or criminal penalties.

In the modern ESI era, the preservation obligation imposes unique challenges. Email and other data systems utilized by businesses may be subject to record retention programs that automatically delete files on a scheduled basis. It is critical that these systems are suspended once the preservation obligation is triggered. It is equally important that individuals not discard, delete, or destroy ESI or other project documents. If physical evidence—like building materials that became part of a project—must be moved or altered in any way, it is important that the other parties to the dispute (or potential dispute) be provided with advanced notice.

Once the preservation obligation is triggered, it typically continues until the matter is resolved.

In most large construction disputes—and even some smaller ones—shortly after arbitration or litigation is commenced, the parties’ attorneys will confer to discuss and formalize an ESI protocol that the parties will use to collect, search, and produce relevant information. Because most construction projects span multiple years, it is impractical for the parties and their lawyers to do a page turn of all emails, texts, instant messages, and other communications sent and received during the project. Thus, the purpose of an ESI protocol is to establish agreed-upon search procedures that maximize the likelihood that relevant material is collected, identified, and produced on an equivalent basis by all parties.

There are at least four core elements to an ESI protocol:

An agreement to collaborate in good faith

Because the ESI protocol is standing in for a full-scale page turn to identify relevant documents, the process is dependent on each side acting in good faith and having confidence that the other parties are making like efforts to collect, identify, and produce relevant information.

An agreement on the sources of data subject to preservation, collection, search, and production

Typically, the data sources will be grouped into custodial data sources—i.e., the data sources specific to individuals (i.e., custodians)—and non-custodial data sources—i.e., the data sources where shared information is stored, like a project file. Depending on the likelihood that a specific data source will have information relevant to the dispute, the parties will agree whether the source will be subject to collection or just preservation. For custodial productions, the parties may also agree to limit the date range for collection with respect to a particular custodian based on the time period that the custodian worked on the project. For instance, if Jane Smith worked on the project only briefly, the parties may agree to initially collect Ms. Smith’s emails only from that specific time period.

An agreement on the way the parties will search the collected data for potentially relevant material

This mainly applies to the emails and other ESI collected from custodial data sources and not project files or other non-custodial sources. Because many of the custodians will have worked on the project for years—and thus will have lengthy collection periods—the volume of total ESI collected from these individuals makes it impossible to perform a page-by-page review to identify the relevant emails and other documents that are responsive to a discovery request. Instead, parties typically agree on search terms that each party will use to identify potentially relevant material. The development of search term lists is typically a collaborative and iterative process that involves running trial searches and exchanging search term reports that show the number of “hits” for each term. Because the purpose of this initial search is to identify potentially relevant documents, the focus is on terms likely to identify documents related to the project in general as well as specific issues in the case rather than elimination of irrelevant documents. Each party will cull out irrelevant documents and other documents not subject to production—e.g., privileged communications—during its internal review processes.

An agreement that metadata will be preserved and produced intact and on the format(s) for production

The metadata provides important information about a document, such as its author, when it was created, and when it was last altered. This can be critical evidence—sometimes even more so than the content of the document. Additionally, law firms representing parties in large construction disputes typically use sophisticated eDiscovery software to manage document discovery. It is important that the parties agree on the metadata fields that are subject to production to maximize the efficiency of the review process using those platforms. It is equally important to agree on the format of production—e.g., whether documents will be produced only in native format or both in native format and with image files.

A fulsome document production is essential to the fair and meritorious resolution of construction disputes. A party’s lawyer will typically lead all stages of the effort to ensure their client meets its obligations to preserve, collect, and ultimately produce documents relevant to a dispute. But the party itself plays an important role in that process, and a fundamental understanding of the party’s obligations is critical for avoiding the sometimes-harsh results of noncompliance.