Tag Archives: rules

Obama Vetoes rule that would have negative impact on union elections

President Barack Obama vetoed a measure passed by the Republican-led Congress that would have stopped the National Labor Relations Board from streamlining the process of unionizing workers.

The new rules, drafted by the NLRB last year would, shorten the amount of time between when a union election is called and when it is held to as little as 14 days.

They also require employers to supply union organizers with workers’ email addresses and telephone numbers, and delay legal challenges by employers until after workers have voted on a proposal to unionize.

They are now set to take effect on April 14.

Earlier this month, Republicans in the House and Senate approved a bill that would have stopped their enactment.

But on Tuesday, Obama vetoed the measure, while stating that he say the NLRB’s approach as “modest” and a reflection of “common sense.”

“”Unions have played a vital role in giving workers that voice, allowing workers to organize together for higher wages, better working conditions, and the benefits and protections that most workers take for granted today.,” the president said. ” Workers deserve a level playing field that lets them freely choose to make their voices heard, and this requires fair and streamlined procedures for determining whether to have unions as their bargaining representative..”

” Because this resolution seeks to undermine a streamlined democratic process that allows American workers to freely choose to make their voices heard, I cannot support it,” Obama added.

via Courthouse News Service.

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Major Possible Changes to Federal Discovery Rules

Corporate Counsel reported about a very important and significant change that might occur next year.  Here are the highlights of the proposed amendments (starting on Page 91 of 322).

The e-discovery rules may change once again by next year.  The United States Court’s Advisory Committee on Civil Rules voted last week to send proposed amendments to the Standing Committee on Rules of Practice and Procedure.  The Standing Committee will consider approving or rejecting the proposal in early June.

The most significant proposals would narrow the scope of discovery under Rule 26; impose or reduce numerical limits on written discovery and depositions under Rules 30, 31, 33, and 36; Rule 37 will adopt a uniform set of guidelines regarding sanctions when a party fails to preserve discoverable information; and Rule 34 will tighten the rules governing responses for production of documents.

Rule 26’s proposed amendments are as follows:

  • Rule 26(b)’s proposed amendment restricts the defined scope of discovery to information that is “proportional to the needs of the case.”  The language is as follows:

    “and proportional to the needs of the case considering the amount in controversy, the importance of the issues at stake in the action, 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.

    These proportional considerations are currently listed in Rule(b)(2)(c)(iii).  This amendment would mandate adherence by the parties without court intervention.

  • Rule 26(b)’s proposed amendment would delete the following sentences:

    (1) “For good cause, the court order discovery of any matter relevant to the subject matter involved in the action.  Relevant information need not be admissible at trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence.”

  • Note, that the proposed amendment for Rule 26(b) states that “Information within this scope of discovery need not be admissible in evidence to be discoverable.
  • Rule 26(c) (protective orders) adds “or the allocation of expenses.”

Rules 30’s and 31’s proposed amendments are as follows:

  • The number of depositions (oral and written) would be reduced from 10 to 5.
  • The limit of an oral deposition is reduced to 6 hours.
  • The number of written interrogatories would change from 25 to 15.
  • The number of requests will be 25, except for requests relating to the genuineness of documents.
  • There will be a presumptive limit on the number of Requests for Admissions a party may serve.
  • A court order or a stipulation by the parties may increase the limits on any numerical discovery.

Rule 34’s proposed amendments (which govern the production of documents and electronically stored information) are as follows:

  • The objections to document requests must be stated with specificity.  This requirement has already been applied to interrogatory responses under Rule 33.
  • When the responding party must state that it will produce the requested documents (instead of permitting inspection), the production must be completed by the date for inspection stated in the request or by a later reasonable time stated in the response.
  • A party objecting to a document request must state whether any responsive materials are being withheld on the basis of the objection.

Rule 37(e)’s proposed amendment (which concern sanctions for failure to preserve discoverable information) state:

  • A court may impose sanctions when it finds that a party failed to preserve information that should have been preserved for litigation.  The sanctions includes remedies and curative measures that are not considered “sanctions,” such as allowing additional discovery, requiring a party to recreate or obtain the information that it lost, or ordering a party to pay reasonable expenses resulting from the loss of information.
  • The court may also impose sanctions listed in Rule 37(b)(2)(A) when to address preservation failures.  These sanctions include issue or evidence preclusion, the striking of pleadings, the dismissal of the action in whole or in part, and an adverse inference.
  • The court may impose sanctions or order an adverse jury instruction only if it finds that the failure to preserve caused “substantial prejudice” in the litigation and was “willful or in bad faith.” or that the failure to preserve “irreparably deprived a party of any meaningful opportunity” to litigate the claims in the action.

 

via On the Cusp of Major Changes to E-Discovery Rules.

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Attorney Fees and Prevailing Party

This is an interesting case, coming out of the 8th Circuit Court of Appeals, that reinforces the idea that attorney fees should only be granted to the prevailing party.

In S. Wine and Spirits of Nevada v. Mountain Valley Spring Co., No. 12-1857 (8th Cir. 2013), the 8th Circuit Court of Appeals ruled that neither of the parties prevailed in the lawsuit.  Thereby, no attorney fees would be granted.

So why did this case come to the 8th Circuit Court of Appeals?  Southern Wine and Spirits won a judgement for $861,000.  In the same token, Mountain Valley won a judgment of $183,000.  Southern argued that it was entitled to attorney fees because it had prevailed on 3 out of its 4 claims and because its monetary award was more than four times larger than the one obtained by Mountain Valley.

The District Court and the 8th Circuit Court of Appeals disagreed.  Following Nevada law, a party is not the “prevailing party” when both parties are found to be at fault.  See also Glenbrook Homeowners Ass’n v. Glenbrook Co., 901 P.2d 132, 141 (Nev. 1995) (per curiam).

Thereby, in this case, when both parties won a judgment, it is fair to say that both parties have been found at fault.

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Judicial Ethics and Social Media

On February 21, 2013, the American Bar Association released a formal opinion (#462) regarding judicial ethics in the social media context.  The ABA concluded,

A judge may participate in electronic social networking, but as with all social relationships and contacts, a judge must comply with relevant provisions of the Code of Judicial Conduct and avoid any conduct that would undermine the judge’s independence, integrity, or impartiality, or create an appearance of impartiality.

So what does this mean?

Electronic Social Media and the Judicial Independence, impartiality, and integrity

The ABA recognized that social networking is a part of worldwide culture and that electronic social media interactions might be beneficial to judges in order to prevent them from being thought of as isolated or out of touch.

So how should judges then behave in this electronic environment?  Given the oath and importance of promoting public confidence in the independence, integrity, and impartiality,” the judge must be sensitive to the appearance of relationships with others.

It is important to understand that relations over the internet are difficult to manage because messages may be taken out of context, misinterpreted, or relayed incorrectly.

In other words, judges must assume that comments, images, or profile information, as well as any other information, might be publicly revealed without the judge’s permission.

In addition, judges should not form relationships with persons or organizations that might be violative of Judicial Ethics because these relationships convey that the individuals or organizations are in a position to influence the judge.

Furthermore, there might be disclosure or disqualification concerns regarding judges when the sites that were “friended” or “liked” which are used by lawyers or others who may appear before the judge.  The context is important here when assessing the judge’s relationship to attorneys or others who may appear before them.

Electronic Social Media and Election Campaigns

In the ABA Model Code (which may be adopted as a whole or in part by states), a judge or judicial candidate may engage in political or campaign activity with certain enumerated exceptions.

Of great importance is that judges and judicial candidates must “be free and appear to be free from political influence and political pressure.” ABA Model Rule 4.1 [1].

Similarly of equal importance, the judge or judicial candidate is prohibited from personally soliciting or accepting campaign contributions other than through a campaign committee.  ABA Model Rule 4.1(A)(8); see also ABA Model Rule 4.4.  In the Model Rules, the method of communication is not addressed or restricted.

In addition, judges and judicial candidates are prohibited from “publicly endorsing or opposing a candidate for any public office.” ABA Model Rule 4.1(A)(3).  This means that judges or judicial candidates should be aware that by “liking” or becoming a “fan” of, or by “sharing” messages, photos, or other content, this Model Rule might be violated.

In sum, judges and judicial candidates can use social media but must be aware of the potential pitfalls that might arise. These might arise from “friending,” “liking,” “sharing,” being a “fan” of, and posting comments, photos, or other information that might be distributed.  It is also important for judges and judicial candidates to be aware that any information on the Internet might be distributed by others and made public with or without their consent.

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In Minnesota, Amendments to the Rules of Civil Procedure Highlight Proportionality

On February 4, 2013, the Supreme Court of the State of Minnesota adopted amendments to the Rules of Civil Procedure, including those affecting discovery.  Of particular note were amendments to Rules 1 and 26.  Specifically (and significantly), Rule 1 was amended to state that it is the responsibility of the parties and the court to assure proportionality throughout the litigation.  Accordingly, Rule 1 now states (new language is underlined):

These rules govern the procedure in the district courts of the State of Minnesota in all suits of a civil nature, with the exceptions stated in Rule 81.  They shall be construed and administered to secure the just, speedy, and inexpensive determination of every action.

It is the responsibility of the court and the parties to examine each civil action to assure that the process and the costs are proportionate to the amount in controversy and the complexity and importance of the issues.  The factors to be considered by the court in making a proportionality assessment include, without limitation: needs of the case, amount in controversy, parties’ resources, and complexity and importance of the issues at stake in the litigation.

Similarly, in addition to other significant amendments to Rule 26, Rule 26.02(b) has been amended to require that the scope of discovery “comport with the factors of proportionality, including without limitation, the burden or expense of the proposed discovery weighed against its likely benefit, considering the needs of the case, the amount in controversy, the parties’ resources, the importance of the issues at stake in the action, and the importance of the discovery in resolving the issues.”  While such limitations to discovery were previously acknowledged, the amended rule more strongly emphasizes the importance of proportionality.

Significant amendments to other rules were also adopted.  Notably, an order attaching “corrective amendments” was entered several days later.  Those orders are available HERE and HERE.  The newly adopted amendments become effective July 1, 2013.

via In Minnesota, Amendments to the Rules of Civil Procedure Highlight Proportionality : Electronic Discovery Law.

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Zubulake revisited: Shifting standards in e-discovery

InsideCounsel has a very insightful article regarding the changes in Zubulake.  As previously addressed, the Zubulake cases are the leading guide posts of electronic discovery.  Nevertheless, recent case law signals potential departures from Zubulake.

InsideCounsel’s article states as follows:

 

Litigation holds 101

While the American concept of the litigation hold (also known as legal hold) received a passing reference in the advisory notes to the 2006 Federal Rule of Civil Procedure (FRCP) amendments, it was not until Zubulake, and later, Pension Committee, that courts connected the legal hold to the spoliation sanction framework.

Generally, sanctions are warranted when a party with control over discoverable information and under a duty to preserve acted with a culpable state of mind when destroying or losing relevant information. Once a party has established spoliation, a court must assess which sanction (ranging from further discovery to dismissal) aligns with the culpability of the spoliating party and the prejudice caused.

In Pension Committee, the court held that failing to issue a litigation hold is gross negligence per se. The court found that not only can relevance and prejudice be presumed when a spoliating party is grossly negligent, but that an adverse inference instruction was the appropriate sanction in that case.

Departures from Zubulake

In 2012, in Chin v. Port Auth. of New York & New Jersey, 11 plaintiff employees sued the defendant employer for alleged civil rights violations. In discovery, the plaintiffs learned that the defendant failed to implement a document retention policy, which resulted in the spoliation of at least 32 folders used to make promotion decisions from August 1999 to August 2002. The plaintiffs also learned that the defendant failed to issue a litigation hold regarding the promotion folders at any point between 2001 and 2007, and thus argued that this inaction amounted to gross negligence. However, the court rejected the argument that a failure to institute a litigation hold automatically constitutes gross negligence per se, contrary to the rule of Zubulake.

Instead, the court ruled in favor of a case-by-case approach, in which failure to preserve documents is one of multiple factors in the determination of whether to issue sanctions. In the end, the court upheld the district court’s conclusion that an adverse inference instruction was inappropriate in light of the limited role of the destroyed folders in the promotion process, as well as the plaintiffs’ ample evidence regarding their relative qualifications when compared with the officers who were actually promoted.

What does it all mean?

Chin established that, depending on the facts, if a party acts reasonably and in good faith to preserve documents, it may be off the hook for severe sanctions. However, many commentators have argued that this does not change best practices—that parties should still issue a written litigation hold in accordance with Pension Committee.

For large organizations that touch many jurisdictions (many of which still follow Zubulake), corporate counsel should not disband their litigation hold systems just yet—in fact, they probably do not want ever to disband them. The litigation hold is an incredible powerful and defensible means to preservation. Large organizations often must track many custodians storing potentially relevant information on complicated IT systems. Corporations derive substantial benefits from being able to maintain holds, as well as being able to internally track multiple simultaneous preservation obligations.

It is worth noting, however, that not every case, or company, is the same. Should a tight-knit company of a few employees in a non-complex litigation have to issue a written legal hold in order to be safe from sanctions? As case law in 2013 develops, perhaps litigants in these types of cases will take a second look at the role of the litigation hold.

A breath of “reasonable” fresh air

On the topic of preservation, case law developments are not the only item on the horizon for 2013. The discovery subcommittee tasked with developing potential FRCP rule changes has been scrutinizing the preservation topic. In one possible version amending FRCP 37, the drafters adopted a factor-based approach to determining culpability. While one factor looks at the reasonableness of a party’s efforts to preserve the information, “including the use of a litigation hold,” another factor includes “the proportionality of the preservation efforts to any anticipated or ongoing litigation.” On Nov. 2, 2012, when the Advisory Committee voted to adopt the subcommittee’s proposal, a common opinion was that even this minor reference to the litigation hold should be omitted or reverted to the commentary to underscore the factor-based nature of draft Rule 37. As we continue down the road to Federal Rule amendments, it is becoming clear that the gold standard of Zubulake may be shifting in the coming year.

via Zubulake revisited: Shifting standards in e-discovery.

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Ethics and Cloud Computing

I came across this post regarding ethics and the use of cloud computing by attorneys.  The post is as follows:

The Massachusetts Bar Association has issued an ethics opinion concluding that lawyers may use cloud services to store and synchronize digital files containing client information, provided the lawyer takes reasonable measures to ensure that the service’s terms of use and data-privacy policies are compatible with the lawyer’s professional obligations. However, lawyers should not use cloud services for clients who expressly request that their documents not be stored online and lawyers should not store “particularly sensitive” information in the cloud without first obtaining the client’s express consent, the opinion says.

MBA Ethics Opinion 12-03 was drafted by the MBA’s Committee on Professional Ethics and approved by the association’s House of Delegates on May 17, 2012. The MBA is not the official lawyer-discipline board in the state, so its ethics opinions are advisory only.

Even so, the MBA’s opinion adds to the growing and unanimous list of lawyer-ethics panels that have concluded that lawyers may ethically use cloud applications and services, provided they take reasonable precautions to protect the confidentiality and security of the data. (See our earlier post: Two New Legal Ethics Opinions Suggest Clear Skies Ahead for Cloud Computing.)

This brings to 11 the number of states that have ruled on the ethics of cloud computing. In addition to Mass., the other opinions are:

Notably, all of these states agree that the use of cloud computing is ethical.

via Mass. Joins Other States in Ruling that Cloud Computing is Ethical for Lawyers.

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Be Nice: More States Are Treating Incivility as a Possible Ethics Violation

The ABA Magazine has an interesting article regarding lack of civility and how it is being addressed by different States and organizations, such as the ABA:

Incivility among lawyers is not a new concern. But as the general tone of public discourse in the United States becomes more heated, the issue of civility—or lack thereof—within the legal profession appears to be moving to the front burner.

“Civility used to be inherent in public discourse. Where did we go wrong?” said then-ABA President Stephen N. Zack in a speech during the 2011 ABA Annual Meeting in Toronto. “As lawyers, we must honor civility,” said Zack, the administrative partner at Boies, Schiller & Flexner in Miami. “Words matter. How we treat others matters.”

Lawyers engaging in uncivil behavior run the risk of court sanctions, but in a growing number of jurisdictions, incivility also may land them in front of their state disciplinary bodies on charges of violating ethics rules.

The ABA Model Rules of Professional Conduct don’t specifically address civility. Nevertheless, a lawyer’s alleged incivility may implicate the competence provisions in Model Rule 1.1 or, more often, Rule 8.4, which contains broad provisions covering misconduct—including dishonesty, fraud, deceit or misrepresentation—and, as stated in Rule 8.4(d), conduct “that is prejudicial to the administration of justice.”

via Be Nice: More States Are Treating Incivility as a Possible Ethics Violation – Magazine – ABA Journal.

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8th Circuit upholds judicial campaign restrictions

The Eighth Circuit in Wetsal v. Sexton, No. 09-1578, ruled en banc that the Minnesota Code of Judicial Conduct clauses for endorsement, personal solicitation, and solicitation for a political organization or candidate do not violate the First Amendment.

Under strict scrutiny, the State bore the burden of proof that the endorsement and solicitation clauses advance a compelling state interest and that it is narrowly tailored to serve that interest.

Minnesota argued that it had a compelling interest in maintaining judicial impartiality and in maintaining the appearance of judicial impartiality.  The Eighth Circuit agreed.  “[W]e easily conclude Minnesota’s interest in preserving the appearance of impartiality is compelling, particularly when cast against other interests courts have recognized as compelling.”

The Eighth Circuit also held that the judicial campaign restrictions were narrowly tailored.  The Court explained that the endorsement clause is narrowly tailored since it restricts speech for or against particular parties, rather than for or against particular issues.  The court explains its concern as follows,

Under either framework, a judge “who tips the outcome of a close election in a politician’s favor would necessarily be a powerful political actor, and thus call into question the impartiality of the court.”

The Court held the solicitation clause is also narrowly tailored.  The Court first distinguished itself from Republican Party of Minn. v. White, 416 F.3d 738 (8th Cir. 2005) (en banc), which dealt with large group solicitation and signature bans; as opposed to Wersal, which dealt with personal solicitation.  With a personal solicitation, “[a] contribution given directly to a judge, in response to a judge’s personal solicitation of that contribution, carries with it both a greater potential for a quid pro quo and a greater appearance of a quid pro than a contribution given to the judge’s campaign committee at the request of someone other than the judge, or in response to a mass mailing sent above the judge’s signature.”  Quoting Siefert v. Alexander, 608 F.3d 974, 989 (7th Cir. 2010).  The Court also concluded that because recusal would not be a workable remedy to prevent bias or the appearance of bias from personal solicitations, the solicitation clause is narrowly tailored.

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ABA Opinion Gives Guidance on Changing Legal Fee Arrangements

Lawyers aren’t expected to practice year after year without raising their fees. And circumstances, of course, can change unexpectedly. So it’s often permissible for an attorney to change legal fee arrangements during an ongoing representation, as long as the change is reasonable and consented to by the client.

However, other provisions may be required or simply recommended to make sure the change complies with the ABA Model Rules of Professional Conduct, explained the ABA Standing Committee on Ethics and Professional Responsibility in an ethics opinion (PDF) announced today in a press release.

The Model Rules are used by many states as a basis for their own attorney ethics rules.

Disclosure in the initial fee agreement that billing rates may change in the future, for example, could rarely, if ever, be a mistake, according to the opinion.

And while lawyers may also require a client to provide new or additional security for payment under an existing fee agreement, they should be aware that this is considered a business transaction with a client that requires compliance with additional ethical standards.

For more details about what is required, read the full opinion, which is known as Formal Opinion 11-458 (PDF).

via ABA Opinion Gives Guidance on Changing Legal Fee Arrangements During Representation – News – ABA Journal.

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