Discovery considerations presented by group collaboration tools
This article was published in the American Bar Association's The Brief, volume 51, number 1, fall 2021. ©2021 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.
Displaced by the COVID-19 pandemic, corporate workforces quickly transitioned watercooler banter and
board meetings from the office into cyberspace. In many ways, the implementation of digital collaboration tools, such as Slack, paved the way for streamlined communication and efficiency. With just a few computer clicks, participants from across the globe are now able to join meetings, provide feedback in live chat streams, and carry out instant messaging conversations with coworkers. While these platforms offer numerous benefits, the vast amount of electronic data that may be created and shared through them within an organization presents additional considerations in terms of discovery obligations in litigation. In this article, we provide an overview of the applicable discovery rules and recent case law addressing disputes arising from workflow platforms as well as guidance for avoiding potential pitfalls in discovery.
Scope of E-Discovery under the Federal Rules
To understand the implications of discovery aimed at group collaboration tools, users must first consider the general scope of discovery permitted in litigation. Federal Rule of Civil Procedure 26(b)(1) provides that a party may obtain discovery “regarding any nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case.” Factors to consider include “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.”
The Federal Rules of Civil Procedure have evolved with the times to specifically address discovery of electronically stored information (ESI). In particular, Rule 26(b)(2)(B) outlines that a party “need not provide discovery of electronically stored information from sources that the party identifies as not reasonably accessible because of undue burden or cost” and places the burden on the party opposing the discovery to “show that the information is not reasonably accessible” because of such undue burden or cost.
Consequences of Failing to Preserve ESI
In 2015, Rule 37(e) was rewritten to “provide a nationally uniform standard for when courts can give an adverse inference instruction, or impose equally or more severe sanctions, to remedy the loss of (or failure to adequately preserve) ESI.” The text of Rule 37 provides a multistep inquiry to assist courts in determining whether sanctions, ranging from monetary fines to termination of a case, are appropriate for the failure to preserve ESI.
First, a party seeking sanctions under Rule 37(e) bears a threshold duty to show that the ESI at issue was, in fact, lost or destroyed. If such a showing has been made, the court must then determine whether “(1) the ESI should have been preserved in the anticipation or conduct of litigation; (2) the ESI is lost because a party failed to take reasonable steps to preserve it; and (3) the ESI cannot be restored or replaced through additional discovery.”
If each of these questions is answered in the affirmative, the next inquiry under Rule 37(e)(1) is whether the loss of information results in prejudice to another party, in which case sanctions may be imposed but no greater than necessary to cure the prejudice. Alternatively, under Rule 37(e)(2), the next inquiry is whether the deleting party acted with the intent to deprive another party of the information’s use in the litigation. Rule 37(e)(2) does not require a finding of prejudice to the party deprived of the information, as it may be presumed or inferred by way of intent. If such an intent is found, the court has discretion to impose a variety of sanctions, including a presumption that the lost information was unfavorable to the party, an instruction that the jury may or must presume that the information was unfavorable to a party, or, most extreme, a dismissal of the action. These rules (and various state law analogues) set the stage for the obligations and consequences parties may face in litigation when utilizing group collaboration tools.
TIP: Businesses employing group collaboration tools in the workplace should develop a protocol for usage to minimize the risk of discovery burdens or disputes in future litigation.
Slack: A Remote Workforce Dream or an E-Discovery Nightmare?
Launched in 2013, Slack has become a common workplace communication tool. Apropos to the subject of this article, “Slack” is an acronym for “Searchable Log of All Conversation and Knowledge.” By the numbers, Slack’s integration into corporate workforces has been nothing short of incredible. As of November 2021, the number of people using Slack daily exceeded 10 million, with 43% of Fortune 100 businesses paying to use the platform. Slack exceeds one billion usage minutes every workday and is designed to work in conjunction with thousands of apps, thereby giving rise to large volumes of electronic data transmitted over its platform.
In order to tailor the platform to specific company needs, Slack offers several levels of service: Free, Pro, Business+, and Enterprise Grid. These plans offer varying degrees of security (including data encryption and document management), as well as custom retention policies for messages and files, and, of relevance here, data exports for all messages. Despite its relatively recent vintage, Slack and similar platforms are already finding themselves in the crosshairs of discovery motions in courts throughout the United States.
A Trio of Slack-Related Rulings from California
Recent cases from California highlight the need for an ESI preservation plan when it comes to the usage of Slack and other group messaging tools—a plan of “a-Slack” if you will. In Benebone LLC v. Pet Qwerks, Inc., Benebone took the position that Slack messages should be excluded from the scope of discovery. As part of the meet and confer process, Benebone informed the defendants that its Slack account contained approximately 30,000 messages and that it would cost $110,000 to $255,000 to extract, process, and review those messages. Based on these cost estimates, Benebone asserted that searching and producing data from Slack would be an undue burden and would not be proportional to the needs of the case. The defendants disagreed and filed a motion to compel Benebone’s Slack messages.
In weighing the Rule 37 and Rule 26 factors, the United States District Court for the Central District of California first noted that because Benebone uses Slack as part of its internal business communication, “there is no real dispute that Benebone’s Slack messages are likely to contain relevant information.” With respect to the claim of burden, the court concluded that requiring review and production of Slack messages by Benebone was generally comparable to requiring search and production of emails and was not unduly burdensome or disproportional to the needs of the case, so long as the requests and searches were appropriately limited and focused. The court reasoned that e-discovery tools are available for such a process, and the scope of Slack messages for review could be narrowed based on channels or users likely to have information relevant to the case.
Calendar Research LLC v. StubHub, Inc., another decision from the Central District of California, provides guidance on another nuance of the Slack platform—the preservation capabilities of free versus paid accounts. In Calendar Research, the plaintiff filed a motion to compel the production of additional Slack messages and the imposition of monetary and evidentiary sanctions against certain defendants. According to the defendants’ counsel, certain Slack folders were not retrievable at the time of the parties’ initial production because the company had used a free account, and full access to the database required a premium account, which the company had since obtained. After the upgrade, Slack informed the defendants that it would not allow a full corporate export of the entire account without the consent of all parties who used the account. However, it provided a utility tool that allowed the company to extract private channels used by the individual defendants.
After extracting those files, the individual defendants were told by their employer, StubHub, that certain files contained communications subject to its attorney-client privilege. StubHub identified the privileged files, and the individual defendants asked their e-discovery vendor to remove them from the remaining files to be produced.
The court granted the plaintiff ’s motion to compel but denied the request for monetary sanctions. The court reasoned that the plaintiff had not demonstrated that the individual defendants had acted in bad faith to justify an adverse inference that they conspired to violate computer fraud statutes. The court further noted that such relief would be particularly inappropriate given that the individual defendants had produced the documents and represented that they would supplement that production as soon as they received the remaining Slack files from their vendor. Although the defendants in Calendar Research avoided sanctions, this case serves as an important warning to litigants as to the potentially severe consequences that may result from the failure to properly preserve and produce ESI from work collaboration tools.
But courts do recognize the bounds of e-discovery. In Laub v. Horbaczewski, the plaintiffs sought to compel various categories of discovery, including messages stored on the defendants’ Slack instant messaging platform. On a prior motion to compel, the court had held that, due to the level of their plan, the defendants’ Slack messages were not within their possession, custody, and control but rather were housed at Slack.com. As such, they were not obligated to produce Slack messages in response to the plaintiffs’ discovery requests. The court instructed the plaintiffs to pursue the messages through a third-party subpoena to Slack, without prejudice to their ability to seek further Slack-related discovery from the defendants directly at a future date.
Thereafter, the plaintiffs requested the defendants’ consent to Slack’s production of messages subject to the defendants’ opportunity to review the messages before they would be produced. Slack objected to the subpoena, citing the Stored Communications Act, and the defendants declined to consent to the subpoena, noting that it was untimely, overbroad, and not proportional to the needs of the case. The plaintiffs filed another motion to compel the defendants to produce the Slack messages, asserting that the company had upgraded its Slack plan, which would allow it to retrieve archived messages (or otherwise, that the defendants should be required to consent to the subpoena to Slack).
In denying the motion to compel and request for sanctions, the court first considered whether the defendants’ upgraded Slack plan gave them access to the messages at issue. Unlike the situation in Calendar Research, the court found no evidence to establish that the defendants now had access to the messages to which they previously did not. The defendants credibly established that while they upgraded from a free Slack account to a paid account on Slack’s “Standard” plan, they still were not permitted to search messages sent via private channels or direct messages. The defendants clarified that although Slack offers a utility tool that permits the export and search of messages sent through private channels, the tool is only available to accounts on Slack’s “Plus” tier or above, which the defendants did not have. Thus, the court stood by its earlier ruling that the defendants need not produce the messages in response to discovery because they lacked access to ESI housed at Slack.com.
The court acknowledged that certain private channel messages sent via Slack might be relevant to the issues in the case but ruled that the plaintiff had failed to satisfy the proportionality requirement of Rule 26.The court agreed with the defendants that any additional evidence derived from the requested individual’s private Slack messages (in addition to the emails, text messages, and messages sent over public Slack channels already produced) would likely be cumulative and that the plaintiffs offered no evidence that the private messages contained any novel or noteworthy information that warranted their production.
Pitfalls Presented by Ephemeral Messaging
Another potential discovery trap arises when a company utilizes a collaboration platform with the ultimate security measure: disappearing messages. Ephemeral messaging applications, such as Signal, are often used by high-profile individuals and companies that strive for the utmost confidentiality in their communications. While disappearing data may be great for real-time confidentiality, these evanescent communications may cause headaches for lawyers if a dispute ends up in litigation.
These issues are not unique to private party litigation— Signal found itself front and center in a recent action filed by the Federal Trade Commission. In August 2021, the United States District Court for the District of Arizona grappled with a defendant’s purposeful use of Signal’s auto-delete function to evade turning over communications in discovery. The deletion of the Signal app from various devices resulted in a total inability of the parties or outside forensic experts to recover the contents of the Signal messages. In determining that ESI was intentionally lost and that sanctions were warranted, the court noted:
[A]utodelete functionality is and has been a near ubiquitous feature in programs and email services that produce ESI, leading to a phalanx of publications warning litigators of the need to clearly and adequately inform their clients to investigate and turn off autodelete functions as part of their litigation hold processes.
Although the facts at issue in this particular case involved a deliberate attempt to conceal communications, the court’s ruling serves as an important reminder to litigants. To satisfy preservation obligations in cases involving ESI, parties should investigate and disable auto-delete functions on email accounts or other data streams upon the onset of litigation if those accounts are reasonably likely to contain relevant information and it is reasonable under the circumstances of the case to do so.
These cases offer helpful guidance for navigating the potentially perilous waters of managing a corporate Slack account or similar platforms. Although no one hopes for litigation, it is not uncommon for a company to find itself embroiled in a dispute that will require discovery of its electronic records. Failure to adequately preserve and manage ESI prior to, and during, litigation can lead to serious consequences.
To minimize the risk of such a scenario, a prudent company should take stock of the types of technology and group collaboration tools it utilizes in the normal course of business. With new apps and tech features popping up constantly, it is natural to jump on the bandwagon and explore new technologies. However, transacting business over various workflow platforms or instant messaging programs may open the door to additional sources of ESI that must be preserved, collected, and produced in subsequent litigation.
After assessing the appropriate tools to employ for corporate purposes, the company should also consider whether to place parameters on the use of such tools. For instance, the use of the chat feature may be limited to informal communication among employees and exclude any substantive business communication. Or perhaps any substantive business communication conveyed over chat must be saved in another location on the company’s system so as to be officially preserved in another format.
These types of precautions may be helpful to the company in a later discovery battle on whether there is substantial need for the messages and whether the burden of collection is proportional to the needs of the case. If no substantive business communication is transmitted over chat, or if all such transmissions would be saved elsewhere, the company may have a compelling argument that the burden of retrieving, reviewing, and identifying potentially responsive messages would greatly outweigh the likelihood of discovering responsive and nonduplicative material. Indeed, with respect to Rule 37(e), the advisory committee noted that “[b]ecause electronically stored information often exists in multiple locations, loss from one source may often be harmless when substitute information can be found elsewhere.”
Regardless of the company’s formal policy on the use of online platforms, employees should be informed of the potential discoverability of chat messaging and reminded that anything said via workplace chat communication may very well be subject to disclosure in future litigation. One of the risks presented by these types of communication tools is the appearance of informality, even compared to email. Employees may feel comfortable saying something over chat that they would not say in person or in an email. Comments may be made without any context or in jest. Companies should educate their employees that, in today’s cyber-focused world, they must be vigilant when engaging in any form of workplace communication, which could become the target of an opposing party’s discovery request years down the road.
A company should also consider the level of subscription plan that is appropriate for its needs. As the California cases discussed above reflect, a litigant’s obligation to produce messages may rest on whether or not it has direct access to message archives. Although we can anticipate that the sophistication of these platforms, and the corporate usage of them, will increase over time such that the “premier” level service is the norm, the current legal landscape does acknowledge the potentially disproportionate burden on a litigant utilizing a free or standard-level plan to obtain ESI housed by a third party such as Slack. A company should evaluate its need for a particular group collaboration tool and make an informed decision as to which plan is suitable, bearing in mind all the “bells and whistles” that might come with it and result in additional streams of data that need to be preserved appropriately.
More broadly, companies should adopt document retention policies that address ESI and ensure that their litigation hold practices comply with the applicable preservation obligations, including disabling automatic delete mechanisms when appropriate. And just as importantly, companies should periodically review their practices and confirm that usage of collaborative workflow tools is being done according to protocol and subject to the appropriate preservation procedures.
In short, companies should think through these issues before finding themselves embroiled in e-discovery disputes. Working with sophisticated e-discovery vendors is critical if the business does not have the in-house resources, and even that can pose its own concerns. All in all, proper planning is critical.
While this review of case law and practical suggestions certainly is nonexhaustive, it offers some helpful guideposts for lawyers and clients facing the new discovery frontier presented by the proliferation of group collaboration platforms in the workplace. As these discovery battles continue to play out in court, we can expect an evolving body of law addressing litigants’ preservation and production obligations in the ESI realm.
[1.] Fed. R. Civ. P. 26(b)(1).
[3.] Fed. R. Civ. P. 26(b)(2)(B).
[4.] Steven S. Gensler & Lumen N. Mulligan, Federal Rules of
Civil Procedure, Rules and Commentary 1194 (2021).
[5.] Porter v. City & County of San Francisco, No. 16-cv-03771,
2018 WL 4215602, at *3 (N.D. Cal. Sept. 5, 2018); see also Fed. R. Civ. P. 37(e) advisory committee’s note to 2015 amendment (“The new rule applies only if the lost information should have been preserved in the anticipation or conduct of litigation and the party failed to take reasonable steps to preserve it.”).
[6.] See Jacquelyn Bulao, 21 Impressive Slack StatisticsYou Must Know about in 2021,TechJury (Nov. 1, 2021), https://techjury.net/blog/ slack-statistics.
[7.] Id; see The Lawyer’s Guide to Discovery and Investigations in Slack, Logikcull, https://www.logikcull.com/slack (last visited Nov. 4, 2021).
[8.] Bulao, supra note 6.
[9.] See Pricing, Slack, https://slack.com/pricing (last visited Nov. 4, 2021).
[10.] See Stewart Butterfield, Slack, https://slack.com/about/leadership/stewart-butterfield (last visited Nov. 4, 2021).
[11.] No. 8:20-cv-00850-AB-AFMx, 2021 WL 831025, at *1 (C.D. Cal. Feb. 18, 2021).
[12.] Id. at *2.
[13.] No. 2:17-cv-04062-SVW-SSx, 2019 WL 1581406, at *1 (C.D. Cal. Mar. 14, 2019).
[14.] No. 2:17-cv-06210-JAK-KSx (C.D. Cal. Nov. 17, 2020).
[15.] See, e.g., Zak Doffman, NewWhatsApp Security Blow: Political Staffers Move to Signal—Here’s WhyThat Matters, Forbes (Feb. 24, 2020), https://www.forbes.com/sites/zakdoffman/2020/02/24/new-whatsapp-security-blow-as-political-staffers-are-pushed-to- signal-heres-why-that-matters.
[16.] Fed.Trade Comm’n v. Noland, No. 2:20-cv-00047-PHX- DWL, 2021 WL 3857413, at *4 (D.Ariz.Aug. 30, 2021).
[17.] Id., slip op. at 12 (quoting DR Distribs., LLC v. 21 Century Smoking, Inc., 513 F. Supp. 3d 839, 931–33 (N.D. Ill. 2021)); see also Sedona Conf., The Sedona Conference Primer on Social Media, Second Edition, 20 Sedona Conf. J. 1, 90–91 (2019) (“A client’s use of ephemeral messaging for relevant communications after a duty to preserve has arisen may be particularly problematic, as it would have the potential to deprive adversaries and the court of relevant evidence.”).
[18.] Fed. R. Civ. P. 37(e) advisory committee’s note to 2015 amendment.