Tuesday, November 17, 2015

Trial & Litigation: Amendments to the Federal Rules of Civil Procedure to be Effective December 1, 2015

By Tyler J. Derr

         On April 29, Chief Justice John Roberts sent a letter to the speaker of the House and the president of the Senate regarding changes to Federal Rules of Civil Procedure 1, 4, 16, 26, 30, 31, 33, 34, 37, 55, and 84 (in addition to the Appendix of Forms) that become effective December 1.  Although some changes are minor, others are significant.

         For starters, the revised Rule 1 puts an onus on the parties to ensure speedy and just resolution of disputes. This change dovetails with the changes to the discovery rules, explained below. Often overlooked by practitioners, Rule 1 is the keystone for all other rules and should be the first rule cited in any discovery motion.

         Rule 26, which governs general discovery matters, now sets forth specific proportionality factors — including the importance of the issues at stake, the amount in controversy, the relative access to relevant information, the parties’ resources, the importance of the discovery in reaching a resolution, and whether the burden or expense of discovery outweighs the likely benefits — that must be considered in determining the scope of discovery. Such factors are in line with the overarching theme of the amendments — parties are to cooperate and not waste resources in the discovery phase.

         The new Rule 37, which permits sanctions for discovery violations, now allows a party to compel an answer, designation, production, or inspection for the failure to produce documents. Rule 37 has also been updated to conform to today’s technologically driven world. Specifically, Rule 37(e) now deals with the failure to preserve it ESI, not just a failure to produce it. The rule allows courts to sanction a party that has lost ESI that should have been preserved in anticipation of litigation. Upon a finding of prejudice, the court may fashion a cure or sanction, such as an award of the costs incurred by the opposing party as a result of the loss of data, even if the loss was unintentional. If the court determines a party intentionally destroyed ESI, it may: (i) presume the lost ESI was unfavorable to the party; (ii) instruct the jury that it must consider the lost ESI unfavorable to the party; or (iii) enter a default judgment. Rule 37(e)’s amendments underscore a party’s efforts to create and comply with a reasonable data retention policy.

         Aside from changes to the discovery rules, two interesting changes have been made to Rule 4. The first has to do with waiver of service. The waiver request must now include the form appended to Rule 4, and if the defendant fails to sign the waiver, the serving party may seek to impose the costs of service upon the defendant. The second has to do with the time for service. Now under Rule 4(m), the court must dismiss the action without prejudice if service is not made within 90 days, instead of 120 days under the old rules.

         The new rules have a clear theme: Streamline litigation, encourage cooperation, and reduce unnecessary expense. Although the amendments are a step in the right direction, only time will tell if the changes result in more narrowly tailored discovery requests and cooperation from counsel and the parties on discovery matters.