Anticipating And Avoiding ESI Problems

Anticipating And Avoiding ESI Problems

by Matthew Kenefick

Not always, but often enough to matter, electronically stored information (“ESI”) problems can be expensive and transform a modest lawsuit into a major dispute. Many times, however, ESI problems can be minimized by identifying the issues early on.

Attorneys commonly work with their clients to institute a litigation hold at the outset of a lawsuit, but will wait until a discovery request is issued before they take a full inventory of their client’s universe of relevant ESI. Such an inventory includes determining the costs and problems associated with the collection, processing, review and production of ESI. A delay in taking such an inventory carries the risk that by the time an attorney learns of his/her client’s ESI problems, so will have the other side who can then use the problems to create a tactical advantage.

An attorney can reduce the risk of ESI problems by evaluating a client’s ESI issues before production obligations arise. ESI problems sometimes may only arise from a group of custodians or a specific issue in the case. Through pleading challenges and amendments, stipulations, admissions of fact and protective orders, a party may be able to exclude expensive or problematic ESI issues before their adversary learns of such issues. By way of example, a party could file a pre-answer motion (e.g., a FRCP 12(b)(6) motion or demurrer) to dispose of an issue which involves a group of custodians who maintain a voluminous amount of active ESI. Likewise, a plaintiff could carefully tailor a complaint to avoid raising issues which invoke ESI that the plaintiff had failed to properly preserve. Various tactics can be employed early on to preempt ESI problems from manifesting – the first step is to identify what those potential ESI problems may be. While some problems are unavoidable, others may be. ESI problems should be considered when formulating a litigation budget and determining settlement value. Attorneys evaluate a whole host of issues in the early stages of a lawsuit, ESI should be one of them.

A challenge with this approach will often be the client. Most clients are adverse to front-loading a case, hoping that the dispute will resolve on its own or through business channels. This approach sometimes proves wise; however, should not preclude a reasonable and early examination into potential ESI problems. ESI problems are volatile and potentially high-stakes – if they can be avoided, they should be.


Matthew Kenefick is a partner in the Litigation Department of Jeffer Mangels Butler & Mitchell LLP. Resident in the Firm’s San Francisco office, his practice extends to many areas, including commercial, business and real estate matters. Matt has experience in all aspects of litigation, including binding-arbitration, trial, appeal, settlement and alternative dispute resolution. Matt also advises retail clients on operational compliance matters. Contact him at 415.984.9677 or MKenefick@JMBM.com.