Data Protection and the New Practice Direction

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Legal IQ: Thank you very much for your time today; to make a start, can you give us a quick introduction into your roles starting with starting with Dominic?

D Regan: Hello. I’m very much a civil litigator and all I do is spend my time talking to lawyers about evolving case law and search through material, so I’ve got a profound interest in how key material is expanding. And indeed a year ago this month I was invited to interview Chris Dale, who we will come to in a moment, for The Times about the function of E-Disclosure. I’m also helping – more about this later – Sir Rupert Jackson with one of his projects which involves electronic disclosure centrally.

Legal IQ: And Chris, could you give us an introduction to yourself and your current role?

C Dale: I run the E-Disclosure information project which carries information about E-Disclosure, as we call it in England – eDiscovery elsewhere, between lawyers and judges and clients and suppliers, so that they each understand what the other is facing and is expecting in terms of the disclosure of electronic information. That is a UK based project but worldwide in the general talking about it and writing about it. I write a blog, I go to conferences and my whole life is devoted to the assimilation and dissemination of information about E-Disclosure.

Legal IQ: Thank you. So having a look at the programme then, Dominic, what do you think about the programme ahead?

D Regan: Well, I have the outline before me and it’s really me asking because Chris is very much the master and the maestro of the topic. But things on the horizon – first of all we’ve got the Bribery Act, and even I can recognise that this is something that crosses borders, but how big is that going to be and where does it fit in with E-Disclosure, Chris?

C Dale: It’s going to be extremely big; this will be the UK playing for the first time a big role in anti corruption. It’s been deferred for the moment whilst the guidance notes are being refined, but the point that cuts across into E-Disclosure, amongst other parts anyway, but the main point is the defence that you had adequate procedures to anticipate and head of bribery. Adequate procedures will include all sorts of things – there will be HR matters and auditing and terms of contract, and that sort of thing, but it will also involve being on top of your information in the same way that one has to be for... to anticipate litigation, for example.

The cross cut, if you like, into E-Disclosure is the quotation from a judgement called Earles against Barclays Bank where His Honour, Judge Simon Brown said this – he said, potential litigants needs to anticipate having to get a disclosure of specifically relevant electronic documentation and have the means of doing so efficiently and effectively. That is going to be... is going to match the same obligations that companies have when they’re gearing up to say that they have adequate procedures.

D Regan: So the mantra is the same? Be prepared or else die?

C Dale: Be prepared or else die. Vivian Robinson, who is General Counsel to the serious fraud office made a speech in Munich a while ago – he is one of the speakers at the IQPC conference in London – and he drew this line, this connection between those things which we urge companies to do in preparation for all sorts of other eDiscovery tasks, not just litigation but regulation. It is the same test; it puts serious pressure on companies to be ready.

D Regan: Right, good; okay. Well, that’s something that is of universal application and bringing with it, I think, tremendously punitive measures for those who contravene the law – that in itself sounds a major point of principle. Also, and more than once – sorry, if I’m not being critical of the programme – data protection, privacy, is that a big deal? Why is that so important? Why is that so highlighted, Chris, do you think?

C Dale: It’s a big deal because of the conflict between US demand for eDiscovery, either for litigation under the Federal rules of civil procedure, or regulatory investigations of one kind or another, or indeed the State, the US, in its official form making enquiries in investigations. That involves, within the US, demands for documents which US lawyers and companies are geared up to anticipate and to deal with. If they come to Europe they expect the same reaction, and what they walk into is EU restrictions on data protection and privacy and on one’s ability to hand over documents. That imposes a pretty serious burden all round because if one simply says, well, I’m 2

sorry, we’re an EU company, we are subject to laws, we cannot hand over documents – that is likely to have adverse effects, sometimes in criminal terms, in the US. So it is again part of the you-must-be-ready type message – at one level it’s simply understanding what the problems are.

D Regan: Indeed. And of course, American lawyers are so much familiar with very wide ranging disclosure, where of course, in our jurisdiction the movement, certainly ever since Lord Wolfson and perhaps also Sir Rupert Jackson has been to narrow it down and make it less and less substantial – so there’s a real tension there between the two jurisdictions, is there not?

C Dale: There is, and in terms of... even one’s surmounted the data protection and privacy hurdles demands for documents that are of the American style, open-ended and extremely broad, walk into exactly as you say, our own much tighter limitations on what you’re entitled to demand from other people.

D Regan: And is that why you’ve got American judges on the panel?

C Dale: That’s part of why we have American judges on the panel. We have a starry array of US judges turning up to sit on the second day, on a panel with two English judges – the two English judges being Master Whitaker and His Honour, Judge Simon Brown QC. The US judges, who are Judge Peck, Judge Grimm and Judge Facciola are leading thinkers and doers in the US, best known judges for handling E-Disclosure.

It’s relevant in the UK for various reasons – one though is that one of the answers that one finds in the UK is when one says to people you ought to be giving disclosure of your electronic documents. People say, oh, E-Disclosure, that’s something Americans do, isn’t it, and look how expensive it is? And it seems to me to be critical to bring over the really thoughtful, influential US judges to show that they take seriously the broad concepts of proportionality, even though the framework of laws on their side is rather different. And it’s a two-way process – we find out more about what they do; they find out what we do, and ideas are generated as a result, and it’s an extremely valuable exercise for that reason.

D Regan: And you mentioned Master Whitaker who, in his own way I think perhaps his judgement of being aware, certainly of our domestic jurisdiction; in the case of Goodale, struck me as astonishing because there we have drug addicts imprisoned, using or seeking E-Disclosure directions. And there is this, I think, massively misleading perception that E-Disclosure is for a handful of people dealing with multinational, commercial, telephone number claims for damages, and Goodale was, if you like, as close to the gutter as one could expect, and yet the topic rears its head there, doesn't it?

C Dale: It does. When you say it’s an astonishing judgement you mean it, I think, in a good way?

D Regan: Oh, absolutely. My point, sorry, it’s not a bad judgement, but astonishing in the sense that it shows that E-Disclosure, to my mind, is permeating its way into the mainstream, is not in the rarefied atmosphere of the, as I say, the blotty commercial, digicell, £100 million sort of claims. This is at the sharp end, this is where, dare I call them normal litigators might find themselves confronted by E-Disclosure, and that’s why I found it a fascinating case.

C Dale: That’s entirely so. It’s important also for another reason that’s fundamental to the management of E-Disclosure, and that is that confronted by one party who said we don't intend to give disclosure of electronic documents, and another party who said we want all the documents that they’ve got. Master Whitaker cut a course through those competing claims by saying let’s focus on the people who matter here, let’s identify a handful of key custodians and get their documents, and then we’ll see if we need to go wider than that. That is entirely catered for within the rules, it doesn’t even depend on the new Practice Direction that we’re going to come to in a minute perhaps.

D Regan: Yes, I wanted to ask you about that.

C Dale: Well, just in fundamental principles, requirements placed on judges to manage cases proportionately, for example, within the overriding objective, Goodale is smack within that and shows what can be achieved in terms of focusing narrowly and early on what matters if you have a judge who is prepared to roll up his sleeves and get involved in the detail.

D Regan: I have a view of that which we’ll come to in a little bit. Now, there is of course, again, I think perhaps two sessions on the new Practice Direction – I hope it doesn’t sound cynical, but has the Practice Direction really changed things or is it just affirming of what was best practice anyway? What was your take there, Chris?

C Dale: The Practice Direction is – I was on Master Whitaker’s working party which drafted the Practice Directions, so it’s a subject that’s dear to my heart – it is in part based on the existing Practice Direction to Part 31, which we’ve had since October 2005, and much of it is not new, it’s simply giving more prominence and sharpening up the obligations in that Practice Direction, which for these purposes, for the purposes that we’re talking about here, are primarily the duty of the parties to find out what they’ve got, what their clients have as electronic sources of information, and to share that information before the case management conference so that the 3 go into the CMC armed with an understanding of what they’ve got and what the other side have got.

D Regan: With their eyes open?

C Dale: Yes, with their eyes open, entirely consistent with Lord Wolfson’s principles of cards on the table but with the added point, if you like, that if they can agree between themselves that certain classes of documents, certain electronic sources whatever they may be, whilst disclosable strictly within the definition of a disclosable document in Part 31, nevertheless are going to add nothing to anybody’s understanding, or may well not add anything to the court’s ability to deal with it, whilst being disclosed as existing are not actually worth hauling into the formal disclosure. Given the cost of disclosure that is an enormous potential saving, again, if one has a judge prepared to manage it actively.

Now, the missing component, if you like, in the original Practice Direction was some formalisation, a structured way of presenting the information that one of the lawyers gets from ones client’s systems. One of the main things that one gets in this Practice Direction is a questionnaire which asks the parties to give information about their client’s systems – not all technical, some of it’s obvious like what date range do you think applies here, which is not a bad thing for parties to agree in advance of giving disclosure instead of discovering afterwards that they had different ideas about that.

That theme permeates the whole questionnaire, which includes the possibility for one side to say what it’s expecting from the other side, and includes a section in which they identify potential problems. All of that ends up in front of the court effectively on two pieces of paper – these are the things we’ve agreed subject to your view, Judge, and these are the things we can’t agree on, will you help us with them which, quite apart from anything else ought to give us much more efficient case management conferences.

D Regan: Utterly, yes.

C Dale: And that is a big step forward. To revert to your precise question which is, is it going to have the influence that is claimed for it? That depends on how you approach it. It actually formally applies to relatively few cases – firstly, the whole Practice Direction only applies to multi track cases; secondly, the questionnaire only comes into play in three circumstances. One is if the parties agree that it would be helpful – so there’s no element of compulsion there. One is if they fail to reach an agreement, and it’s implicit in that position that there was something to disagree about – so it’s not being imposed on parties where electronic disclosure isn’t a relevant consideration anyway.

And the third area is where they have reached an agreement but the court doesn’t like the look of it. There again, one takes it for granted that there was something to fight about, or something to agree about at least, before the court decides to propose the questionnaire. And even then the court is not compelled to use the questionnaire; it can decide whether it’s a good idea for parties to complete all or part of the questionnaire. So those who say, oh, this questionnaire thing is imposing enormous burdens on us clearly haven’t red it, and that is one of the main messages.

D Regan: And you’re going to be explaining that in great detail I have no doubt, at the conference?

C Dale: In greater or lesser detail, depending on which session we’re in. Nevertheless, it is important because a lot of lawyers – and this anecdotal rather than statistically based evidence – anecdotally a lot of lawyers are looking at the questionnaire and saying, well, even in cases that it doesn’t formally apply to, we think this is a pretty good way of narrowing the field of identifying what we ought to be discussing with our opponents, and perhaps we should use it anyway, and not just in the field of litigation. It has a role, I think, in regulation where one gets marks, as it were, from the regulator by showing that you’re on top of your systems, and being able to complete the questionnaire properly is an example of that.

D Regan: Good. Well, certainly from my perspective it’s fascinating because – many won’t appreciate it – but I’m monitoring (unclear) and the cost management pilot in Birmingham, and a fundamental part of that is E-Disclosure as a method of getting the costs down and getting on with actions. And certainly I know it is the view, for I’d heard it from his own lips, that the Senior Cost Judge that the Birmingham pilot is seen as great success, and later this year is going to be extended. So the whole approach of case management with E-Disclosure at the core of it, is something that’s plainly not going to go away is it, Chris?

C Dale: It isn’t; case management is ultimately cost management, that’s what it’s about, that we should go the one further step and require parties to say up front what they think components of the litigation are going to cost. They seem a radical step but actually if the court is supposed to be deciding what is proportionate, how can it do that without knowing what estimates are around? Not just for a way of running a litigation perhaps, but in some cases for different alternative ways of doing it. Since proportionality is effectively weight risk against cost, risk that you’ll miss something against the cost of finding everything, it’s hard to see how one can make a proper proportionate decision without some idea of what the costs are. 4

D Regan: My final question, because I’m intrigued, on the agenda there is a play – and I wondered if that was a misprint but I’m told that it’s not – what is the play?

C Dale: The play is something I’ve written now for two years running, which casts the judges that we’ve got around anyway, in varying roles – some as judges, some as litigants – trying to deliver in a relatively light hearted way some serious messages. The idea of the role play is for those who are pretending to be the lawyers, they have got it wrong perhaps in one respect or another, whilst the judges hand out their suggestions as to how it should be done, or their orders.

What was interesting last year when we did it at the same IQPC show, was that many of the cases which immediately preceded that defied parody anyway. It was relatively...

D Regan: You couldn’t make it up?

C Dale: You couldn’t make it up, so quite a lot of it simply involved not quite copying and pasting from the judgements, but picking up some of the ideas. That seemed to go down well as a way of sugaring the pill, if you like, handing out what are serious messages but doing it in a way that’s less...

D Regan: In a palatable manner. Well, Chris, it’s been lovely talking to you as ever.

C Dale: And to you, Dom.

D Regan: I very much hope that I’ll be... I didn’t get an invite to the May event but I think that’s, from my understanding, is now much clearer and Chris has as ever set out his stall in perfect form – so with that I think I’ll hand you back to our hostess.

C Dale: Well, thank you very much for your questions.

Legal IQ: Well, Chris, Dominic, thanks very much for your time and insight today; it’s been great to get some lively discussion on the subject.