E-Discovery and HIM: How Amendments to the Federal Rules of Civil Procedure Will Affect HIM Professionals

by Kim Baldwin-Stried, MBA, MJ, RHIA, CPHQ

Barring congressional action, on December 1, 2006, a series of amendments to the Federal Rules of Civil Procedure (FRCP) governing e-discovery will take effect. Are you ready? You and your organization must be prepared to respond to e-discovery requests for information.

This article focuses on two important professional practice topics for HIM professionals: a description of the structure and content of the FRCP and a discussion of how HIM roles will change through implementation of its e-discovery amendments.

The Federal Rules of Civil Procedure

The FRCP govern legal proceedings for civil lawsuits in United States district (federal) courts. The FRCP are promulgated by the United States Supreme Court and approved by the United States Congress. They are comprised of 11 different categories and 86 different rule sets, as summarized in the table “Outline of the Federal Rules of Civil Procedure,” below.

The Judicial Conference of the United States gives its Committee on Rules of Practice and Procedure the power to appoint an Advisory Committee on the Rules of Civil Procedure, which has primary responsibility to monitor the effectiveness of the Rules of Civil Procedure and make recommendations for proposed amendments. Since their establishment in 1938, the FRCP have undergone nine revisions (1948, 1963, 1966, 1970, 1980, 1983, 1987, 1993, and 2000). “The FRCP are not changed very often, so the courts take notice when they are,” notes John Patzakis, vice chairman and chief legal officer of Guidance Software, an e-discovery software vendor.

The US district judge has the ultimate authority in courtroom legal procedure and a very important role in advancing common law practice and establishing new positions. The district court judge applies the substantive laws of the state when making decisions.

Magistrate judges or special masters can also resolve e-discovery disputes. District judges have heavy caseloads; therefore, using magistrate judges and special agents for e-discovery disputes can achieve significant litigation cost and time savings.

Each state will have (or will develop) its own rules regarding e-discovery. Most state e-discovery rules will be adopted based on the FRCP and landmark case law. Over time, the 2006 FRCP amendments will create a whole new set of challenges, opportunities, and responsibilities for legal, IT, and HIM professionals. The endeavors will vary somewhat by state, but regardless of jurisdiction, e-discovery will become an integral function of e-HIM^®.

HIM professionals then must be knowledgeable about their state laws regarding discovery and seek the advice of their legal counsel as necessary when responding to e-discovery requests.

How the Role of HIM Professionals Will Change

Change is perhaps the one true constant under which HIM professionals operate today.

Adapting sound information management to emerging electronic practice is the biggest challenge. “Now, more than ever, HIM professionals are being called upon to ensure a systemized approach to electronic record management that conforms to state and federal legal requirements.”¹ To do this, however, requires a consideration of how HIM roles and functions will change through amendments to the FRCP and landmark e-discovery case law. Summarized on the following pages is an assessment of how those roles and responsibilities will change and evolve through e-discovery.

Electronic Records Management

Danis v. USN Communications, No. 98 C7482, 2000 WL 1694325 (N.D. Ill. Oct. 23, 2000)

Zubulake v. UBS Warburg LLC, 217 F.R.D. 309, 2003 U.S. Dist. LEXIS 7939, 91 Fair Empl. Prac. Cas. (BNA) 1574, 55 Fed. R. Serv. 3d (Callaghan) 622 (S.D.N.Y. May 13, 2003) (“Zubulake I”)

Zubulake v. UBS Warburg LLC, 2003 U.S. Dist. LEXIS 7940, 91 Fair Empl. Prac. Cas. (BNA) 1590 (S.D.N.Y. May 13, 2003) (“Zubulake II”) Please note: Zubulake II does not relate to disclosure of electronic data.

Zubulake v. UBS Warburg LLC,Z 216 F.R.D. 280, 2003 U.S. Dist. LEXIS 12643, 92 Fair Empl. Prac. Cas, (BNA) 684, 56 Fed. R. Serv. 3d (Callaghan) 326 (S.D.N.Y. July 24, 2003) (“Zubulake III”)

Zubulake v. UBS Warburg LLC, 220 F.R.D. 212, 2003 U.S. Dist. LEXIS 18771, 92 Fair Empl. Prac. Cas. (BNA) 1539 (S.D.N.Y October 22, 2003) (“Zubulake IV”)

Zubulake v. UBS Warburg LLC, 2004 U.S. Dist. LEXIS 13574, 85 Empl. Prac. Dec. (CCH) P41728, 94 Fair Empl. Prac. Case (BNA) 1 (S.D.N.Y. July 20, 2004) (“Zubulake V”)

HIM and IT professionals should familiarize themselves with Zubulake v. UBS Warburg (I–V). These five e-discovery cases were decided by the Honorable Shira A. Scheindlin, a United States district judge for the Southern District of New York. Judge Scheindlin’s rulings, along with the Sedona Guidelines (see below) are rapidly defining the e-discovery standards and records management practices for business and healthcare.

Laura E. Ellsworth, a partner in the law firm Jones Day, and Kathleen Massey, vice president of litigation for Motorola, Inc., interviewed Judge Scheindlin in March 2004. They asked, “What are the first 10 steps to ensure your company is prepared to comply with e-discovery obligations?”

Judge Scheindlin answered (paraphrased):

1. Establish a well thought-out records retention policy that takes into account any statutory or regulatory obligations.
2. Make sure someone is really in charge of records retention and that he or she knows what he or she is doing.
3. Establish a records retention committee that meets regularly.
4. Disseminate the records retention policy to all employees and test them.
5. Set up a response team every time there is a litigation need to preserve documents.
6. Consult outside counsel regarding records retention policy.
7. Retain an outside vendor, if case warrants it, to assist in organizing litigation holds.
8. Encourage outside counsel to raise preservation costs at the earliest time.
9. Ensure general counsel is educated and knowledgeable about organizational technology and an organization’s choices for storing records.
10. Be very careful to avoid destruction of documents when it is clear there is a duty to preserve, because sanctions can be imposed when documents are destroyed with duty to preserve.²

Danis v. USN Communications is important to the HIM profession because as evidenced in this case, the courts can impose fines upon organizations (and its individuals, such as CEOs) when organizations employ individuals unqualified in appropriate records management practices. Therefore, organizations must ensure the HIM function is appropriately and effectively managed.

What to Do

Read the Zubulake v. UBS Warburg opinions of Judge Scheindlin to understand e-discovery industry practices and how a foremost legal expert applied the principals of the Sedona Guidelines in the courtroom.

Review the Sedona Guidelines, available on the Sedona Conference Web site at www.thesedonaconference.org.

Organizations must employ qualified and competent HIM professionals who are knowledgeable in e-HIM and state and federal regulations regarding electronic health information management. When unqualified individuals are responsible for the records management function, the organization and its management are at risk for fines or sanctions.

HIM and IT professionals should maintain ongoing education, training, and competency in recognized healthcare electronic systems applications and standards, such as HL7, HIPAA, ASTME, ANSI, and CCHIT.

Subpoena Processing

Important or Related Case Law

Ayers v. SGS Control Servs. 2006 WL 1519609 (S.D.N.Y. pr. 3, 2006)

Zubulake v. UBS Warburg LLC, 217 F.R.D. 309, 2003 (S.D.N.Y. May 13, 2003) (“Zubulake I”)

The Professional Impact

HIM professionals must be aware that e-discovery will be a two-tiered process. The two-tiered discovery process is outlined under 26(b)(2) and provides for balance between the production of electronically stored information that is “reasonably accessible” versus electronically stored information that is “not reasonably accessible.”

Subpoena processing is a pretrial HIM function that will change significantly through e-discovery.

As determined in Zubulake I, any relevant evidence is admissible and therefore can be subpoenaed.

In Ayers, the court ordered production of payroll and time-keeping records in electronic manipulable form, without a third-party subpoena and despite the organization’s prior hard-copy production of the documents.

It is important, therefore, to identify early in litigation (before, if possible) what the true costs to produce electronically stored information are. If deemed excessive, burdensome, or inaccessible, the court can impose mechanisms for sharing the cost of production of information.

Subpoenas will outline requirements that permit testing, sampling and inspection, and copying of paper and electronic records.

Provisions are also in place for subpoenas to designate the form or forms (e.g., paper and electronic, including allowing on-site review and access to information systems and computers) of production of electronically stored information. Electronically stored information need not be produced in more than one form, unless the court orders it for good cause.

What to Do

Review the trial category (category VI) of the FRCP.

Read the relevant FRCP involving subpoena processing including 45, 45(a)(1)(C), 45(c)(1), 45(c)(2)(B), 45(d)(1)(A), 45(d)(1)(B), 45(d)(1)(C), 45(d)(1)(D), 45(d)(2)(A), 45(d)(2)(B).

Refer to Federal Rules of Evidence (803(6)) for admissibility standard of record and Evidence Rule 502 addressing waiver of privilege.

Legal, HIM, and IT professionals should identify which requests for information via subpoena will present an undue burden or cost to the organization to produce.

Organizations should establish a means for determining the actual costs for production of electronically stored information.

Legal, HIM, and IT professionals should establish a “subpoena response plan” for objections to production of certain types of data, including requiring a court order when data requests are determined too costly and burdensome to produce. The response plan should include the following actions:

1. Identify the date of subpoena service.
2. Assess the validity of the subpoena (appropriate jurisdiction, seal, fees).
3. Determine the type and nature of case (civil, criminal, class action) and the parties named. Is the organization or any of its providers a part of the litigation?
4. Determine whether or not information requested is under a legal hold. If not, immediately establish one and notify appropriate departments of the parties involved.
5. Determine whether a pretrial conference was held in which the parties met and identified issues related to e-discovery, including the form or forms in which data should be produced. If so, obtain a copy of Form 35.
6. Determine the level of privacy protection of the information being requested (i.e., subpoena, court order, attorney-client privilege). Establish provisions for “quick peeks” and “claw backs.”
7. Identify when and in what forms the information will be produced (Form 35).
8. Determine the apparent or known issues of the case. Determine what relevant data must be produced and how to access and produce it.

Records Storage, Retention, and Destruction

Related Case Law

Broccoli v. Echostar Communications Corporation, 229 F.R.D. 506 (D. Md., August 4, 2005)

Coleman (Parent) Holdings, Inc. v. Morgan Stanley & Co., Inc., 2005 WL 679071 (Fla. Cir. Ct. Mar. 1, 2005)

In re Prudential Ins. Co. of America Sales Practices Litig. 169 F.R.D. 598 (D.N.J. 1997)

Wachtel v. Guardian Life Ins. Co., 2006 WL 1286189 (D.N.J. May 8, 2006)

Williams v. Sprint/United Mgmt. Co., 2005 U.S. Dist. LEXIS 21966 (D. Kan. Sept. 29, 2005) (“Williams I”)

United States v. Philip Morris, 327 F.Supp.2d 21, 25 (D.D.C.2004)

U.S. v. Arthur Andersen, LLP, 374 F.3d 281 (5th Cir. 2004)

Zubulake v. UBS Warburg LLC, 220 F.R.D.212, 217, (S.D.N.Y 2003) (“Zubulake IV”)

The Professional Impact

In Broccoli, the court held that “Echostar acted in bad faith in its failure to suspend its e-mail and destruction policy or preserve essential personnel documents in order to fulfill its duty to preserve the relevant documentation for purposes of potential litigation.” Sanctions were imposed upon the organization, including an adverse spoliation jury instruction.

In its decision In re Prudential Ins. Co. of America Sales Practices Litig., the court imposed $1 million in sanctions for destroying documents relevant to pending litigation.

Coleman v. Morgan Stanley is a landmark e-discovery case that healthcare organizations and HIM and IT professionals should familiarize themselves with. In Coleman, sanctions were imposed upon the defendant for “its numerous willful and grossly negligent discovery abuses.” Sanctions imposed included:

• Shifting the burden of proof on fraud issue to the defendant
• Court reading to the jury a statement of facts recounting defendant’s duty to preserve evidence and its failure to do so; such facts would be deemed conclusive
• The defendant being ordered to compensate plaintiff for costs and fees associated with the dispute

Through the FRCP, related e-discovery case law, as well as thoughts outlined in the Sedona Guidelines, organizations are expected to establish a records management culture that fosters compliance with all state, federal, and regulatory requirements.

HIM professionals need to be aware that “electronically stored information is characterized by exponentially greater volume than hard-copy documents.”³ They must also remember that the current hybrid records management encompasses electronic medical records as well as any and all information stored, created, or accessed within the organization, including e-mail, voice mail, text messages, metadata, back-up tapes, and legacy information systems.

HIM and IT professionals should begin to conduct comprehensive organizational information flow assessments to determine the forms, methods, formats, and systems used to manage, store, retain, and destroy documents, and electronic, voice, and digital information. They need to be able to effectively respond to complex e-discovery litigation or threaten imposition of sanctions.

Williams v. Sprint has become a landmark e-discovery case concerning metadata. It established the following standard:

When a party is ordered to produce electronic documents as they are maintained in the ordinary course of business, the producing party should produce the electronic documents with their metadata intact, unless that party timely objects to production of metadata, the parties agree that the metadata should not be produced, or the producing party requests a protective order.

What to Do

Review the FRCP aimed at discovery of electronically stored information.

Relevant e-discovery sections include 16, 26, 33, 34, 37, 45, and Form 35.

Refer to AHIMA practice brief “The New Electronic Discovery Civil Rule,” published in the September 2006 issue of the Journal of AHIMA and available online at www.ahima.org.

Legal, HIM, and IT professionals must establish policies and processes for ongoing monitoring and updates to organization document storage, retention, and destruction schedules.

Ensure organizational records management storage and destruction policies:

1. Identify and document the method, location, and native file format of information created within the organization.
2. Recognize that the organization is not obligated to retain all information created or received, unless a business or legal obligation exists for an organization to maintain information. Retaining information beyond these reasons could pose liability for the organization.
3. Specifically delineate the organization’s electronic records maintenance, storage, and destruction schedules.
4. Determine how the organization would define “good faith operation” of its electronic information system if called upon to do so.
5. Establish internal audits or controls to measure compliance with the organization’s storage, retention, and destruction policies. A records management storage, retention, and destruction policy that is not followed is not only useless, it is a potential liability.
6. Recognize that FRCP Rules 37 and 37(f) provide for sanctions and safe harbors, while FRCP 26 provides for provisions to balance the proportionality of e-discovery requests for information.

Risk Management/Litigation Hold

Related Case Law

Rambus v. Infineon Technologies, 220 F.R.D. 264, 282 (E.D. Va. 2004)

Stevenson v. Union Pacific 354 F.3d 739 (8th Cir.2004)

Wiginton v. C.B. Richard Ellis, No. 02 C6832, 2003 WL 22439865, *7 (N.D. Ill. Oct. 27, 2003)

Zubulake v. UBS Warburg LLC, No. 02 Civ. 1243 (SAS). 2204 WL. 1620866, *12 (S.D.N.Y. July 20, 2004) (“Zubulake V”)

The Professional Impact

Through the FRCP, related e-discovery case law, and thoughts outlined in the Sedona Guidelines, organizations must evaluate and enhance their risk management and litigation hold processes.

HIM and IT professionals should meet with legal and risk management to discuss current policies and procedures for suspension and destruction of electronic records in the face of threatened or pending litigation.

What to Do

Legal counsel and senior management should assess the organization’s current litigation hold process.

The organization should review all current policies and procedures related to risk management, including subpoena processing and the establishment of litigation holds.

Steps to be taken include:

1. Identifying all individuals responsible for receipt and processing of subpoenas (e.g., risk management and HIM departments).
2. Documenting the organization’s current process to identify and communicate threatened or pending litigation.
3. Documenting how information is preserved in the face of pending litigation. It should be determined:
   • Who is responsible for establishing a legal hold
   • How data and systems will be secured and for how long
   • Who must be notified
   • The cost and burden to preserve the data
   • Under what circumstances the legal hold will be lifted
   • How the organization expects to respond to the e-discovery request (through an external e-discovery litigation software vendor or through internal IT systems)
4. Determining how large amounts of electronic data will be accessed, manipulated, and produced in response to an e-discovery request.

Professional Litigation Support

Case Law

Sanders v. State, S.W.3d, 2006 WL 561853 (Tex.App. -Waco)

The Professional Impact

Litigation support will evolve as a profession for IT and HIM professionals.

E-discovery requests will be limited at first, but the FRCP amendments—coupled with the advent of sophisticated enterprise investigation systems and complex needs for record searching and retrieval—will create new roles and responsibilities for HIM and IT professionals.

In Sanders, the Court of Appeals of Texas affirmed the trial court’s determination that the “software used by law enforcement investigators properly preserved, authenticated and retrieved digital evidence from the appellant’s computer.” This case is important to HIM because it establishes that in the future, the courts may take judicial notice of the reliability (or unreliability) of particular methods to search and produce electronic information.

On July 27, 2006, by a vote of 270-148, the House passed HR 4157. This legislation promotes the use of health IT to improve the safety and quality of the nation’s healthcare system. This legislation also will help establish national benchmarks and standards by which organizations can measure and compare their safety and quality outcomes. As a result, it will be necessary through sophisticated litigation support mechanisms for organizations to demonstrate their compliance with national safety and quality standards. HIM and IT professionals should therefore begin to understand the features and functionality of the business litigation support vendors in existence in the marketplace today.

What to Do

HIM and IT must maintain effective and ongoing communication with legal counsel in cases involving discovery of electronically stored information. HIM and IT professionals should advise legal counsel at the outset of a case as to the forms, format, location, and accessibility of any and all information maintained by the organization relevant to a case.

Organizations should establish a team of legal, IT, and HIM professionals to address potentially complex e-discovery needs. The team must be knowledgeable of IT litigation support technology and establish a functional requirements list tailored to the needs of the organization.

A New HIM Function

Laws, rules, and regulations are major impetuses behind the policies and procedures we develop to manage health information. As HIM professionals we are keenly aware of our compliance responsibilities.

As the amendments to the e-discovery FRCP change the legal process, so too will they affect the roles of IT and HIM professionals. The challenges and responsibilities will vary by state—and they will evolve slowly—but regardless of the jurisdiction, it is apparent that the ability to respond to e-discovery requests will become an increasingly integral function for both IT and HIM professionals.

Notes

1. AHIMA e-Discovery e-HIM Workgroup. “The New Electronic Discovery Civil Rule.” Journal of AHIMA 77, no. 8 (2006): 68A–H.
2. “Interview of Judge Shira A. Scheindlin.” The Sedona Conference. 2004. Available online at www.thesedonaconference.org/dltForm?did=ScheindlinInterview.pdf.
3. US Courts. “Summary of the Report of the Judicial Conference Committee in Rules of Practice and Procedure.” September 2005. Available online at www.uscourts.gov/rules.

References

Coleman (Parent) Holdings, Inc. v. Morgan Stanley & Co., Inc., 2005 WL 679071 (Fla. Cir. Ct. Mar. 1, 2005). Available online at www.prestongates.com/images/pubs/adverse_inference.pdf.

Danis v .USN Communications, No. 98 C7482, 2000 WL.1694325 (N.D. Ill. Oct. 23, 2000). Available online at cyber.law.harvard.edu/digitaldiscovery/library/preservation/danis.html.

Federal Rules of Civil Procedure. 2005. Available online at http://judiciary.house.gov/media/pdfs/printers/109th/civil2005.pdf.

Federal Rules of Evidence. 2004. Available online at http://judiciary.house.gov/media/pdfs/printers/108th/evid2004.pdf.

“Key Appellate Court Ruling Validates Guidance Software’s EnCase Computer Forensic Software.” CCNews. March 17, 2006. Available online at www.ccnmag.com/news.php?id=4119.

“Magistrate Orders Production of Payroll and Timekeeping Records in Electronic, Manipulable Form Despite Prior Hard Copy Production.” Electronic Discovery Law. June 7, 2006. Available online at www.ediscoverylaw.com.

Ronan, Timothy G. “A Primer on the Pitfalls of Failing to Preserve Electronic Evidence.” Connecticut Lawyer, May 2004. Available online at www.pullcom.com/docs/ElectronicEvidence_TGR_May04.pdf.

Williams v. Sprint/United Mgmt. Co. 2005 U.S. Dist. LEXIS 21966 (D. Kan. Sept. 29, 2005). Available online at www.ksd.uscourts.gov/opinions/032200JWLDJW-3749.pdf.

Zubulake v. UBS Warburg LLC, 2004 U.S. Dist. LEXIS 13574, 85 Empl. Prac. Dec. (CCH) P41728, 94 Fair Empl. Prac. Case (BNA) 1 (S.D.N.Y. July 20, 2004) Available online at www.doar.com/documents/Zubulake.pdf.

Acknowledgment

The author acknowledges Kenneth J. Withers, Esq, of the Sedona Conference for his insight and contributions to this article.

Kim Baldwin-Stried (kbstried@aol.com) is a healthcare compliance professional.