Seminar Materials - Illinois Association of Defense Trial Counsel

Transcription

IDC Winter Seminar
Presented in Conjunction with the Texas Association of Defense Counsel
R. Howard Jump, Jump & Associates, P.C., President
R. Sean Hocking, Craig & Craig, Events Committee Chair
Heather R. Watterson, Kopon Airdo, LLC, Events Committee Vice Chair
Wednesday, February 6, 2013
6:00 - 8:00 p.m. Welcome Reception with the Texas Association of Defense Counsel
Thursday, February 7, 2013
7:30 - 8:30 a.m. Employment Law Update: Social Media - Joshua D. Brown, Lee and Kinder, LLC,
Denver, CO
8:30 - 9:30 a.m. Cybertheft and Insurability - Presented by: Terry A. Fox, SmithAmundsen, Chicago
4:30 - 6:00 p.m. Ethical Downhills, Moguls and Half-Pipes Presented by: R. Howard Jump,
Jump & Associates, P.C., Chicago
Friday, February 8, 2012
7:30 - 8:15 a.m. Jurisdiction and Venue after the Federal Courts Jurisdiction and Venue
Clarification Act of 2011 - Presented by: Peter Jennetten, Quinn, Johnston,
Henderson, Pretorius & Cerulo, Peoria
8:15 - 9:15 a.m. Technology in the Courtroom - There's an App for That! Presented by:
W. Mark Bennett, Strasburger & Price, LLP, Frisco, TX and Timothy
Weaver, Pretzel &Stouffer, Chartered, Chicago
9:15 - 10:00 a.m. Social Media as an Investigative Tool: You Won't Believe What's Out There!
Presented by: Heidi A. Coughlin, Wright & Greenhill, P.C., Austin, TX
Saturday, February 9, 2013
7:30 - 8:30 a.m. Evidentiary Issues Affecting Peer Review Processes - Presented by: John
Watson, Craig & Craig, Mt. Vernon
8:30 - 9:30 a.m. Inherent Conflicts with Litigation Hold Letters - Presented by: David H.
Levitt, Hinshaw & Culbertson, LLP, Chicago
IDC Winter Seminar
Presented in Conjunction with the Texas Association of Defense Counsel
W. Mark Bennett, Strasburger & Price, LLP, 2801 Network Blvd, Ste 600, Frisco, TX 75034,
[email protected]
Mark Bennett splits his practice serving as outside general counsel for numerous companies and handling
complex litigation, bankruptcy, and workout related matters for clients in various industries, including major energy
companies. His outside general counsel experience includes representation of companies of all sizes, both publicly
traded and private. In this role, he is responsible for the overall legal issues of the companies, including business
transactions, mergers and acquisitions, contracts, labor and employment, intellectual property, bankruptcy and workouts,
and general litigation matters, among other areas. Mark also has extensive experience representing logistics and energy
industry clients in litigation, bankruptcy, and workout matters. He previously served as a Senior Attorney with Texaco
Inc. and was in charge of West Coast litigation and all bankruptcy matters for the company. He currently advises clients
on oil and gas transactions, particularly in the downstream market. Mark also currently serves as outside general counsel
for one of the largest publicly-traded logistics companies in the country.
Joshua D. Brown, Lee & Kinder, LLC, 3801 East Florida Avenue, Suite 210, Denver, CO 80210, 303-539-5421,
[email protected]
Mr. Brown recently joined Lee & Kinder LLC and focuses his practice on representing insurance carriers and
employers in workers’ compensation, employment law and general liability claims. He handles matters arising under
such laws as Americans With Disability Act (ADA), Title VII of the Civil Rights Act of 1964, the Age Discrimination
and Employment Act (ADEA), Colorado Wage Act and the Fair Labor Standard Act. Mr. Brown has defended
employers against claims of workers’ compensation, discrimination, harassment, retaliation based on race, color,
religion, sex, national origin, age and disability, in addition to local discrimination laws. He has also represented
employers in the enforcement of employment contracts, including breach of contract matters, non-compete and trade
secret issues.
Heidi A. Coughlin, Wright & Greenhill, 221 W. 6th Street, Suite 1800, Austin, TX 78701, 512-476-4600, hcoughlin@w
-g.com
Ms. Coughlin represents individuals, small businesses, schools, and corporations in many types of civil and
commercial litigation. She handles cases of varying size and complexity, including whisteblower actions, personal
injury, wrongful death, premises liability, defamation, products liability, breach of contract, and employment disputes.
She has sucessfully tried, co-chaired, and second-chaired numerous jury trials. In law school she was selected as a
member of the Board of Barristers and the National Mock Trial Team.
Terry A. Fox, SmithAmundsen, LLC, 150 N. Michigan Avenue, Suite 3300, Chicago IL 60601, 312-894-3343,
[email protected]
Terry Fox is a partner practicing out of SmithAmundsen’s Chicago and St. Charles offices concentrating his
practice in tort and employment related litigation. His practice focus includes advising and protecting employer’s rights
in all areas of employment disputes, including Family Medical Leave Act, Title VII, Civil Rights Act, Americans with
Disabilities Act, Age Discrimination in Employment Act, and other disputes stemming from similar state and local
statutes or ordinances. Terry has significant experience advocating for employers before the Equal Employment
Opportunity Commission, the Illinois Department of Human Rights and Illinois Human Rights Commission, Cook
County Human Rights Commission, and in federal and state trial and appellate courts. He is conversant in E-Discovery
issues, having counseled clients on the impact of information systems on litigation. He has obtained injunctive relief
against terminated employees to stop post-termination contact through internal communication networks. In close
conjunction with employment issues, Terry is involved in insurance coverage, policy drafting, and other risk transfer
strategies. Additionally, Terry has over 15 years of experience in residential and commercial construction disputes.
Peter R. Jennetten, Quinn, Johnston, Henderson, Pretorius & Cerulo, 227 NE Jefferson Street, Peoria IL 61602-1211,
309-674-1133, [email protected]
Peter R. Jennetten is a partner with the Peoria firm of Quinn, Johnston, Henderson & Pretorius. Mr. Jennetten
focuses his practice in Municipal Tort Liability, Civil Rights & Discrimination, Appellate Practice in State and Federal
Court Systems, Premises Liability, Construction Litigation, Employment Law – Litigation, Insurance Coverage and
Analysis Litigation, and Libel and Slander / Defamation. Mr. Jennetten earned a B.S. (cum laude, 1991) and M.S. (cum
laude, 1993) from the University of Illinois and his J.D. (cum laude, 1996) from Georgetown University Law Center. He
was also named the Illinois State Bar Association Young Lawyers of the Year (Downstate) in 2003 and one of Peoria;s
“40 Leaders Under 40” in 2002.
R. Howard Jump, Jump & Associates, P.C., 11 S. LaSalle Street, #2000, Chicago IL 60602-3901, 312-629-5757,
[email protected]
R. Howard Jump is with the Chicago office of Jump & Associates, PC. Mr. Jump practices in all areas of
insurance defense and coverage at the trial and appellate levels. He is currently President-Elect of the IDC. He is long
time member of the IDC's Insurance Law Committee and served as its Board Liaison. He has been a contributing author
of articles on insurance coverage issues for the IDC Quarterly and newsletters for the Insurance Law Committee. His
past IDC service includes: Chair of the Defense Tactics Seminar; Co-chair Long Range Planning; Trial Academy
Faculty; Board of Directors; YLD Liaison; Construction Coverage Symposium Planning Committee; Medicare Seminar
Planning Committee; Bylaws Revision Committee; Committee Structure Initiative; Membership Task Force; Committee
Boot Camp Initiative. He presently serves as Co-Chair of the newly established Industry Relations Committee. He
received the IDC's Distinguished Member Award in 2008. Mr. Jump is also a member of the American, Illinois and
Chicago Bar Associations, the Defense Research Institute and the Association of Defense Trial Attorneys.
David H. Levitt, Hinshaw & Culbertson, LLP, 222 N. LaSalle Street, Suite 300, Chicago, IL 60601-1081, 312-7043515, [email protected]
David Levitt is an experienced trial lawyer and mediator who focuses his practice in a number of distinct areas,
including Intellectual Property, Insurance, Products Liability and Trucking. Mr. Levitt joined Hinshaw & Culbertson
LLP in September 1979. He is a founding member of the Trucking Industry Defense Association. He is the First Vice
President of the Illinois Association of Defense Trial Counsel, and a past editor-in-chief of The IDC Quarterly, as well
as a frequent contributor. Mr. Levitt is also a very active member of the Defense Research Institute (DRI). He has written
for many of its publications and served as editor on others. In October 2009 he was appointed Chair of the DRI
Commercial Litigation Committee Intellectual Property Specialized Litigation Group (SLG). He served as the group’s
Vice-Chair from 2007 to 2009. In addition, Mr. Levitt was profiled in the “Leadership Spotlight,” section of the
December 3, 2007 edition of DRI’s e-newsletter, The Business Suit.
John F. Watson, Craig & Craig, 1807 Broadway Avenue, PO Box 689, Mattoon IL 61938-0689, 217-234-6481,
[email protected]
John F. Watson is a Partner with the Mattoon office of Craig & Craig. Mr. Watson's fields of practice include
general civil defense litigation, medical malpractice defense, municipal liability defense, insurance coverage and
insurance law.
Timothy A. Weaver, Pretzel & Stouffer, Chartered, One South Wacker Drive, #2500, Chicago IL 60606-4673, 312-578
-7416, [email protected]
Timothy A. Weaver is an equity partner at the Chicago law firm of Pretzel & Stouffer, Chartered, where he
concentrates his practice in the defense of physicians and hospitals in malpractice jury trials and general civil litigation
defense. He is a graduate of Brown University, AB cum laude, and University of Illinois, College of Law, JD, where he
was Notes Editor for the Illinois Bar Journal, Recent Decisions Department. He is licensed in Illinois and Wisconsin and
conducts multiple jury trials each year. He was General Editor for two Illinois Institute for CLE books on medical
malpractice litigation.
Slide 1
Social Media Investigation in Litigation
Defense:
Tips and Potential Pitfalls
Joshua D. Brown, Esq.
Lee & Kinder LLC
3801 E. Florida Ave, #210
Denver, CO 80210
303.539.5421
[email protected]
www.leekinder.com
© 2013
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Slide 2
Overview
• Social Media Investigations in litigation are no longer the
exception, but now the norm and a necessary tool.
• Discussion Points
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What is Social Media and what types exist?
What investigative uses exist for litigators in social media?
Tips that exist in finding social media information
Tips for the presentation of such information in court
Ethical and liability concerns that exist with the investigation and
use of social media.
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Slide 3
Social Media Statistics
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Social Media is highly prevelant in today’s world.
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Facebook now has over 850 million users!
96% of people under age 30 have joined a social network
LinkedIn has 100 million users; Twitter has 75 million users
There are over 200 million individual blogs.
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Slide 4
What is Social Media?
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Internet networks that provide a forum and opportunity for registered
and nonregistered users to view information posted on those
websites by various individuals and entities.
Personal, business, dating, advertising, education, etc….
Lots of types. Facebook, Twitter, YouTube, Linked-In, Yahoo,
flicker, Blogs, Discussion forums, google services, Worldpress,
etc…..
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Slide 5
What is Social Media?
•
Most sites encourage users to share even the most mundane aspects of
their daily lives.
•
General Tips for Litigation
– More common place for Plaintiff(s) to be counseled by their attorneys.
• Thus – gather any and all information immediately upon defending a
claim. Do not wait for discovery.
• Continue to check periodically.
– More active – check once or twice per week.
– Less active – every couple weeks.
– The Reverse is also true – Plaintiff counsel are investigating your clients and
their corporate management, officers and employees.
• Defense counsel should speak with company representatives, their agents,
adjusters and other representatives early in the lawsuit about the importance
of not sharing any information on these websites about the Plaintiff or the
lawsuit.
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Slide 6
Facebook
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Slide 7
Facebook: Public vs. Private
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Privacy setting established by the user will dictate whether a Facebook
page is private or public.
If a Facebook account exists under a particular user’s name, generally a
search on Facebook will reveal the account.
– However, it may not allow you to access all of that user’s information.
– If it is truly public (meaning that no privacy settings have been
established), you will be able to see everything that the user posts,
inclusive of writings, pictures, videos, etc….
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Slide 8
Twitter
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Slide 9
Linked In
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Slide 10
Blogs
•
Are online personal journal entries with reflections, comments, and
often hyperlinks provided by the writer.
– Consist of written comments, posting of pictures/videos, links to
other websites and other blogs, as well as personal background
information from the writer.
– Blogs are commonly public and not private.
•
Most have comment sections at the end of each entry which allows
both the writer and users to interact as to the contents of each
posting.
•
Can also be business oriented, in an effort to market the business’
products and/or services.
•
Common Sites: Google Blogger, Wordpress, LiveJournal, Tumblr,
blog.com, etc….
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Slide 11
Blogs
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Slide 12
Discussion and Message Forums
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An Internet forum, or message board, is an online discussion site
where people can hold conversations in the form of posted
messages.
Hierarchical or tree-like in structure: a forum can contain a number
of subforums, each of which may have several topics. Within a
forum's topic, each new discussion started is called a thread.
Includes postings of videos and pictures.
If there is a topic out there, there probably a discussion forum on the
internet.
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Slide 13
Example Forum: Frequent Flyer
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Slide 14
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Slide 15
What Investigative Uses Exist with Social
Media?
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Various investigative uses exist including:
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Obtaining additional background information on plaintiffs.
Surveillance cases (photos, habits, activities).
Locating witnesses.
Background information like character, habits, activities, financial
information and motivation.
– Identifying relationships and/or accomplices.
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Slide 16
Tips for Locating Social Media Information on
Plaintiffs and Witnesses
•
Using Search Engines
– Are algorithmic information retrieval systems that allow searching of massive
web-based databases.
– A web search engine is designed to search for information on the World Wide
Web and FTP servers.
– The search results are generally presented in a list of results and are often called
hits. The information may consist of web pages, images, information and other
types of files.
– Common Search Engines: Google, Bing, Yahoo, AOL Search, AlltheWeb.com,
and Ask Jeeves.
•
Common Searching Methods
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Keyword
Complete Phrase
OR Keyword
Exclude Words or Phrases
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Slide 17
Tips for Locating Social Media
Information on Plaintiffs and Witnesses
• Advanced Search Tips – using Search Meta Words
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“site”
“hostname”
“linkdomain”
URL:
inURL:
Intitle:
A strong search usually contains both the common search
methods, along with the meta words.
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Slide 18
• Level One Type of Searches
– Utilizes the search engines and social media websites with a
plaintiff’s/witness’ name, address, telephone number and specific
location
– For e.g. “Joshua Brown” Denver
– Tend to produce a lot of hits which can be narrowed by the meta search
identifiers
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Slide 19
• Level Two Type of Searches
– Email Address = the gateway to social media findings!
• Nothing more revealing for information than learning personel email
addresses.
• Most sites requires use of an email address to sign up, register or
log-in to
• Determine what social media sites a plainitff is a member of and
search within each site using said email address.
• Domain of the email address may lead to other findings.
• Determine Internet Avatar or Identifiers
– For e.g. [email protected]
– “Coloradotraveler” may lead to other sites, blogs, forums, etc….
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Slide 20
Discovering Email Addresses
• Tips for Discovery Personal Email Addresses
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Review your client’s records
Insurance claim notes
Advise clients/adjusters to request from plaintiff’s
Ask for it in discovery!!!
• Caution: New statutes may prevent.
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Slide 21
– Family and Friends – a diligent search on social media
websites should not end with just the plaintiff or witness.
• Average of 120 friends on Facebook
• Information may exist which is posted by the plaintiff or witness on
the family or friend page.
• Tip Here: Look for patterns of who your subject communicates with.
• Also look for friends with the same last name, interests, or have
repeated interactions with your subject.
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Slide 22
– Pay Sites and Information Aggregators
• Additional tools that pull information from multiple sources and
pages.
• Consolidate the information in a easy digested report.
• Examples:
– Spokeo - Big Brother Of Social Networking.
– 123people.com – Gateway to Paid databases. Shows available
websites around a specific name.
– Pipl - The most comprehensive people search on the web.
– yoName – Searches Social Networks
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Slide 23
Tips for Preserving and Presenting
Social Media Findings
• Preservation of Information
– Can be challenging given that the media is constantly changing
with users updating and deleting information on a daily basis.
• Note: Potential obligation by users of obligation to preserve social
media evidence as relevant to the lawsuit or litigation.
– Relatively few standardize accepted methods for gathering
social media evidence.
• Common Approach = print screen capture and/or print on to paper
to be used in court.
• However – this approach is not ideal because it may not gather all
the information that you want or you may have authentication
problems.
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Slide 24
• Preservation of Information
– Solution = Retention of Third Party Investigator/Computer
Forensic Expert
• Capture a screencast
• Preserve the screencast
• Perform webcast narration by the investigator (optional)
• Obtain signed affidavits
• Court Testimony
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Slide 25
• Evidentiary Concerns
– Special consideration must be given to the rules of evidence
when planning to use this at trial.
– Applicable rules of evidence apply to social media information
and attorneys must satisfy specific requirements for admissibility
under the rules of evidence.
– Important Federal Rules
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Relevancy under 401.
Probative under 403
Hearsay concerns
Authentication concerns under 901
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Slide 26
• Practical Considerations
– Social medial information is useful in litigation, but will likely not
be the essential piece of evidence to close or win your case.
– More times, the information will help you make other decisions
for the defense of lawsuits, approach settlement or find other
discoverable pieces of information.
– Do not heavily rely on such information given that most judges at
hearings/trials limit the use of social media.
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Slide 27
• Courtroom Presentation Tips
– KEY - Do not forget that most judges and some members of a
jury are unfamiliar with social media. Thus, some explanation is
required and can be done through your preservation expert.
– Use Easily Legible and Viable Mediums to Present the
Information
• Legible documents
• Enlarged Photographs
• Video Slideshows
– Be Brief and to the Point.
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Slide 28
Ethical and Liability Concerns with
Investigating Social Media
• Performing Ethical Searches
– Still relatively new type of investigation, little guidance from
authoritative sources on the best way to handle, preserve and
gather social media materials.
– Common Dilemma: information exists on social media sites but
the user can only gain access to the information if you “friend” or
take any step necessary to contact the plaintiff in order to access
their site, blog, etc….
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Slide 29
• Some Authoritative Guidance
– Pennsylvania Bar Association Opinion, 2009 – an attorney or
someone acting on behalf of the attorney making “friend
requests” to an opposing party would be inappropriate under the
Professional Rules of Ethical Conduct.
– New York Bar Association Opinion, 2010 - issued an ethics
opinion confirming that attorneys could access another party’s
social media site in an effort to gather potential impeachment
evidence so “long as the party’s profile is available to all
members in the network and the lawyer neither ‘friends’ the other
party nor directs someone else to do so.”
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Slide 30
• Tips to Avoid Ethical Concerns
– If its truly public information, it’s fair use and okay to review, preserve
and use in litigation.
– No deceptive practices should be used to obtain social media
information from plaintiffs.
– Attorneys, claims professionals or their agents should not contact an
adverse party through a “friend request” or “tweet” or other similar
private message.
– Contacting a plaintiff’s friends and family? Still up in the air and not
decided, but would appear that would not be contact with an opposing
party and thus no ethical concerns.
– If information is private, consider a subpoena.
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Slide 31
•
Liability Concerns
– Legal remedies and protections are available for improper
investigation practices.
– Stored Communications Act
• 1986 – Electronic Communications Privacy Act has restricted
certain kinds of access to data communicated through computer
systems. 18 USC
2701 to 2712
• Title II, known as the Stored Communications Act, prohibits
unauthorized access to remote computing operations and stored
electronic communications in order to protect individual privacy.
• Private right of action exists for a private employer’s knowing or
intentional unauthorized access to social media sties or personal
email accounts.
• Equitable and declaratory relief available, actual and statutory
damages ($1,000 per violation) , plus attorney fees and costs
• Punitive damages available for willful or intentional conduct.
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Slide 32
– Illinois Lawful Products Statute - 820 ILCS 55/5
• State law that protects an applicant’s or employee’s use of lawful
products.
• “it shall be unlawful for an employer to refuse to hire or to discharge
any individual, or otherwise disadvantage any individual, with
respect to compensation, terms, conditions or privileges of
employment because the individual uses lawful products off the
premises of the employer during nonworking hours.”
• “It shall be unlawful for any employer to request or require any
employee or prospective employee to provide any password or
other related account information in order to gain access to the
employee's or prospective employee's account or profile on a social
networking website or to demand access in any manner to an
networking website.”
• Public domain information is excluded.
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Slide 33
– Illinois’s Social Media Privacy Statute - 820 ILCS 55/10
• “It shall be unlawful for any employer to request or require any
employee or prospective employee to provide any password or
other related account information in order to gain access to the
networking website or to demand access in any manner to an
networking website.”
• Public domain information is excluded.
– Invasion of Right to Privacy
• Common law tort action if right to privacy has been violated.
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Slide 34
Future of Social Media
•
•
Here to stay and not ending any time soon.
Increases in mobile accessibility is increasing the numbers of user
members and the amount of information placed on sites on a minute
by minute basis.
– Social platforms are here to stay. Explosion in users reflect that.
– Social Marketing will continue to grow. Businesses are trying to stay on
top of utilizing social media as the new norm for business marketing and
incorporating strategies and software to interact with their customers.
– Digital world will remain. This is not changing and will result in
continued social media platforms that invite plaintiffs for use and us as
defense lawyers to investigate.
•
Bottom Line: as defense attorneys, investigation into social medial
information should also become the norm and used as a tool to
assist in the defense of workers’ compensation claims
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Social Media Investigation and Litigation Defense:
Tips and Potential Pitfalls
Joshua D. Brown, Esq.
Lee & Kinder LLC
3801 E. Florida Ave, #210
Denver, CO 80210
303.539.5421
[email protected]
www.leekinder.com
© 2013
A.
FOCUS OF PRESENTATION
Social media investigations on employees and applicants are no longer the exception
but more and more are turning out to be a required tool in the defense of litigated
claims. Thus, the evidence found on social media sites can be a valuable addition to a
well-rounded investigation, revealing the kind of information that, years ago, would
have been difficult, if not impossible, to find.
Overview





B.
What is Social Media and what types exist?
What investigative uses exist for litigators in social media?
Tips that exist in finding social media information
Tips for the presentation of such information in court
Ethical and liability concerns that exist with the investigation and use of social
media.
OVERVIEW OF SOCIAL MEDIA STATISTICS
Facebook now has over 850 million users and is often the number one traffic
inducing website, beating out perpetual top dog Google.
During certain data points, Facebook generates 7.07 percent of all web traffic while
Google generated 7.03 percent. Combined that’s 14% or almost a 1/6th of all internet
usage.
Other statistics show the following:
 96% of people under age 30 have joined a social network
 LinkedIn has 100 million users; Twitter has 75 million users
 There are over 200 million individual blogs
*Source: Socialnomics, Eric Qualman, Wiley Pub. 2009
KEY: These statistics show just how prevalent social media is in people’s lives and
why these sites can be a gold mine of information in insurance claims and in
litigation.
2
C.
WHAT IS SOCIAL MEDIA?
1. Overview
Social networks are internet sites which provide a forum and opportunity for
registered and nonregistered users to view information posted on those websites by
various individuals and entities. The sites encourage users to share even the most
mundane aspects of their daily lives. Uses of social media include for personal
interaction, dating, businesses, advertising, education, etc….
Lots of types. Facebook, Twitter, YouTube, Linked-In, Yahoo, flicker, Blogs,
Discussion forums, google services, Worldpress, etc…..
TIP: Plaintiffs are now being counseled by their attorneys to avoid using social
media and in some cases to delete their profiles entirely. Many attorneys are giving
this advice during initial consultation, thus it becomes important to gather social
media information as soon as possible.
Once you learn that an employee or former employee uses a social media website
and has an accessible profile, it must be checked periodically throughout the
litigation process.
There is no specific rule of thumb on when to check these pages, but it will likely
depend on the plaintiff’s usage tendencies and the types of postings the plaintiff
has made in the past.
TIP: It is worth noting that plaintiffs can also use social media against defendants just
as easily. Defense counsel should speak with company representatives, their agents,
adjusters and other representatives early in the lawsuit about the importance of not
sharing any information on these websites about the Plaintiff or the lawsuit.
3
2. Facebook - Twitter - Linked In
Private vs. Public:
Privacy setting established by the user will dictate whether a Facebook
page is private or public. If a Facebook account exists under a particular
user’s name, generally a search on Facebook will reveal the account.
However, it may not allow you to access all of that user’s information. If
it is truly public (meaning that no privacy settings have been established),
4
you will be able to see everything that the user posts, inclusive of writings,
pictures, videos, etc….
5
\
3. Blogs
In addition to the exploding usage of the above website based platforms, so too are
people creating individual blogs which acts as an online personal journal with
reflections, comments, and often hyperlinks provided by the writer. These can
contain a wide variety of information consisting of written comments, posting of
pictures/videos, links to other websites and other blogs, as well as personal
background information from the writer. Blogs are commonly public and not private.
Most have comment sections at the end of each entry which allows both the writer
and users to interact as to the contents of each posting.
Blogs can also be business oriented, in an effort to market the business’ products
and/or services. There are also professional blogs that exist as part of the blogger’s
job duties. Journalists are frequented with having separate blogs that publish material
on a daily basis.
Common sites to search for blogs include Google Blogger, Wordpress, LiveJournal,
Tumblr, blog.com, etc….
6
4. Discussion/Message Forums
An Internet forum, or message board, is an online discussion site where people can
hold conversations in the form of posted messages. They differ from chat rooms in
that messages are at least temporarily archived.
A discussion forum is hierarchical or tree-like in structure: a forum can contain a
number of subforums, each of which may have several topics. Within a forum's topic,
each new discussion started is called a thread, and can be replied to by as many
people as so wish. Depending on the forum's settings, users can be anonymous or
have to register with the forum and then subsequently log in order to post messages.
On most forums, users do not have to log in to read existing messages. These often
contain not only discussions, but the posting of videos, pictures and links.
If there is a topic, likely there is a discussion or message forum associated with it.
Thousands upon thousands exist and the likelihood that a plaintiff is using one is
usually dependant upon his/her interests.
7
8
D.
WHAT INVESTIGATIVE USES EXIST WITH SOCIAL MEDIA?
Various investigative uses exist including:




Obtaining additional background information on plaintiffs
Surveillance cases (photos, habits, activities)
Locating witnesses
Background information like character, habits, activities, financial information
and motivation
 Identifying relationships and/or accomplices
But the information has to be gathered in a way that will hold up in court and avoid
liability and ethical concerns. Also, because it’s such a new source of evidence in
investigations, case law is developing rapidly.
May get you to settlement faster!
E.
TIPS FOR LOCATING SOCIAL MEDIA MATERIAL ON PLAINTIFFS AND
WITNESSES
1.
Using the Search Engines
Search engines are algorithmic information retrieval systems that allow searching
of massive web-based databases. A web search engine is designed to search for
information on the World Wide Web and FTP servers. The search results are
generally presented in a list of results and are often called hits. The information
may consist of web pages, images, information and other types of files.
Common Search Engines: Google, Bing, Yahoo, AOL Search, AlltheWeb.com,
and Ask Jeeves.
Search basics: common ways to search

Keyword
By default, the search engines searches for all of the words you type into a
search form. If you type grammar into the search form, the search engines
will return pages and documents that contain the word grammar. A search
for grammar school will return documents that contain both words
somewhere within the document, but not necessarily together.

Complete phrase
To search for words in a specific order, enclose the words in quotation
marks. A search for "grammar school" will return pages and documents
that contain the complete phrase grammar school. You can combine
keyword and phrase searches. To find documents that contain the phrase
9
grammar school and also have the word Illinois somewhere in the
document, you could search for "grammar school" Illinois.

OR keyword
You can change the default behavior of keyword searches by using the
capitalized keyword OR between words. A search for grammar OR
primary will return documents that contain either grammar or primary,
but not necessarily both words.

Exclude words or phrases
To find documents without a certain word, you can use the minus sign (-)
along with the word you want to exclude. If a search for Illinois school
returns too many pages for schools in the city of Chicago, you could type
Illinois school -Chicago to exclude any pages with the word Chicago from
the results.
Advanced Search Tips: In addition to the basic operators, there are keywords
called "search meta words" that you can use to refine your search:

site:
Use this keyword to limit search results to a single web site. You can
search for the word Mars across NASA sites by typing mars
site:nasa.gov. All of the results will be from sites hosted at the nasa.gov
domain. You also use this keyword to limit results to a single top-level
domain, such as .org, .com, or .edu. To find mentions of the word Mars
across academic sites, type mars site:.edu.

hostname:
This keyword limits results to a specific host at a site. For example,
NASA's Mars Exploration Program has a Web site at
http://mars.jpl.nasa.gov. If you want to search this specific section of the
nasa.gov domain for the word rover, you could type rover
hostname:mars.jpl.nasa.gov.
10
 linkdomain:
Instead of a specific page, this keyword looks for any links to a specific
domain. If you're interested in pages that link to http://www.cnet.com,
type linkdomain:cnet.com.
 URL:
This keyword lets you look up a single page by specifying the URL. You
can look up the O'Reilly Hacks home page by typing
url:http://hacks.oreilly.com. You could use this keyword to see how
pages at a site are displayed on the web, as images, and for video Search
results.
 inURL:
Use this keyword to find sites that have a specific word within the URL.
To find all sites that have the word Mars in the URL, type inurl:mars.
 intitle:
Like inurl:, this keyword returns documents that have a specific word in
the document title. To find documents with Mars in the title, use
intitle:mars.
NOTE: You can also use the basic search operators in combination with the
search meta words to refine your search.
For e.g., if you would like to search for the word Mars across documents, but
you don't want pages from any nasa.gov site; type mars -site:nasa.gov.
Because the search engines support very long queries, you could specify a
whole list of sites that you don't want information from: mars -site:nasa.gov site:mars.com -site:space.com.
But to search those sites exclusively, take away the minus symbol, group the
site list together with parentheses, and use the OR keyword like this: mars
(site:nasa.gov OR site:mars.com OR site:space.com). Again, note that the
use of the OR keyword requires the use of parentheses.
11
2.
Level One Type Searches on Plaintiffs and Witnesses
This search can be made by using the search engines. The search simply
uses a plaintiff’s name with or without a specific location. For example
searching “Joshua Brown” Denver. This can also include adding a
plaintiff’s address and known telephone numbers.
Similar type of basic searches can be done on the social media websites as
well, such as searching Joshua Brown on Facebook, twitter, youtube,
etc… For example, you could search “Joshua Brown Denver” on
Facebook to try and locate any individuals with this listed name who also
lists either their current location or place of birth as Denver.
3.
Level Two Type Searches on Plaintiffs
These types of searches go beyond simply the name, location of or
telephone number for the plaintiff. This requires knowledge of plaintiff’s
email addresses, avatar identifiers, discussion forum names, blog
identifiers, etc.. This often reveals much more detailed information about
what plaintiffs are doing on the internet, what sites they may belong to or
are members at and specific postings.
Email Address: An email address is usually the gateway to additional
information that goes beyond what can be discovered by simply searching
a name, address and/or telephone number. Most of the social media sites
require use of an email address to register or to log in.
Searching under an email address on the search engines can then reveal
what social media sites a plaintiff is a member of and where he/she might
be posting information and/or comments. Additionally, search the email
address at the particular social media sites such as Facebook, Twitter,
youTube, etc...
Also, an email address might in of itself reveal key internet identifiers
such as their avatar, blog or discussion forum name. For e.g. – a personal
The term
email address might be [email protected].
“coloradotraveler” may be used by the plaintiff as a blog title, avatar
names for discussion forums, and Facebook/twitter profiles.
Furthermore, the email address may be linked to various social media
facets within the hosting domain for the email. Hosting domain
companies such as “@gmail” (for google), “@yahoo” “@msn” “@aol” all
offer individual social sites, picture posting services, messenger services,
etc.. that are all linked to a user’s email address.
12
TIPS for Discovering Personal Email Addresses:




Review your client’s records
Insurance claim notes
Advise clients/adjusters to request from plaintiff’s
Ask for it in discovery!!!
Friends and Family: A diligent search should also go beyond the
plaintiff’s information. Reviewing information about his/her friends and
family can also reveal information about plaintiff’s other postings,
pictures, videos, etc…
According to a study from 2009, the average user has 120 “friends” on
Facebook. Obviously checking all of these friends is not an efficient use
of time, but usually a pattern exists of who a plaintiff will communicate
more with on such sites.
When searching friend lists, look for “friends” with the same last name or
individuals identified as family members on the profile. Check these
individuals’ pages in the hopes of finding beneficial photographs or
information about the plaintiff. Also check friends that reveal repeated
interaction on a daily basis.
4.
Pay Sites and Information Aggregators
There are tools which pull in information from multiple sources, and
consolidate that information into a smaller and more easily digested
number of streams

Spokeo - Big Brother Of Social Networking.

123people.com – Gateway to Paid databases. Shows available
websites around a specific name.

Pipl - The most comprehensive people search on the web.

yoName – Searches Social Networks

Various Vendors
13
E.
TIPS FOR PRESERVING AND PRESENTING SOCIAL MEDIA FINDINGS
1. Preservation of Information
Collecting evidence from social media sites can be challenging for several
reasons. Social media is constantly changing, and users can easily update and
delete material that could be evidence in a case, although once a user is aware of
an ongoing investigation, he or she is under an obligation to preserve social media
evidence just as if it were any other type of evidence.
So far there are relatively few standardized, widely accepted methods for
gathering evidence from social media sites. A common approach is for someone
to just try to print what they see on their screen onto a piece of paper and show it
in court. However, printouts don’t always contain all of the information and the
interactivity that takes place on social media sites.
Solution = Retention of Third Party Investigator/Computer Forensic Specialist
 Capture a screencast. A screencast captures the look, words, images,
interactivity and inter-relationships from one page to the next. It’s a
valuable tool because it allows for a succinct presentation of the
information and what’s on a social media profile today may not be there
tomorrow.
 Preserve the screencast with a time-date stamp. The screencast then can
be placed on various types of media for presentation purposes in litigation,
such as for depositions, mediations and in court purposes.
 Perform a webcast narration (optional). The investigator records a
video of him/herself talking about what they are seeing on the page. There
are several effective tools for this, including Camtasia and Screencast-OMatic.
 Obtain a signed affidavit from the investigator and prepare him/her for
hearing testimony.
2.
Evidentiary Concerns
Special consideration must be given to the rules of evidence when planning to use
this at trial. Applicable rules of evidence apply to social media information. That
is, attorneys or other individuals seeking to use photographs, comments or
connections discovered on an individual’s social networking site, i.e. Facebook or
Twitter, must satisfy specific requirements for admissibility under the rules of
evidence.
14
Federal rules regarding electronic stored information provide some guidelines:




Relevancy under 401.
Probative under 403
Hearsay concerns
Authentication concerns under 901
3. Practical Considerations
Social media information is a useful tool in the litigation process, but it will not
always provide you with that essential piece of evidence to close the case. More
often than not, you will gather pieces of information that will help guide you to
make more informed decisions on how to proceed with the defense of the claim,
approach settlement and/or find other items of potential discovery to assist with
the defense.
Do not rely heavily on the discovery and existence of social media findings as
part of your overall claim defense. Usually, presentation of such information at
hearing/trial is for a credibility attack and even then, most judges allow for these
limited purposes.
4.
Presentation Tips to Judges and Juries
 KEY - Do not forget that most judges and some members of a jury are
unfamiliar with social media. Thus, some explanation is required and can
be done through your preservation expert.
 Presentation Medium: present the materials to judges and juries so it’s
easy for them to review and comprehend.
i. Legible documents
ii. Enlarged Photographs
iii. Video slideshows
 Be Brief and to the Point: Most of the judges will consider the social
media findings relevant on a limited basis, but will not allow you to
belabor on the materials. Presentation should be to the point in order to
elicit the key information you wish to show from the social media content.
15
F.
ETHICAL AND LIABILITY CONCERNS WITH INVESTIGATING SOCIAL
MEDIA
1.
Performing Ethical Searches
Since the use of social media information in claims and litigation is still relatively
new, there has been little guidance from authoritative sources on the best way to
handle, preserve and use this information.
Any contact with Plaintiffs or an opposing party via Facebook, MySpace, Twitter
or other social networking sites maybe viewed as an inappropriate and illegal
contact with an opposing party.
Common Dilemma: information exists on social media sites but the user can only
gain access to the information if you “friend” or take any step necessary to contact
the plaintiff in order to access their site, blog, etc….
Pennsylvania Bar Association Opinion, 2009 – an attorney or someone
acting on behalf of the attorney making “friend requests” to an opposing
party would be inappropriate under the Professional Rules of Ethical
Conduct.
New York Bar Association Opinion, 2010 - issued an ethics opinion
confirming that attorneys could access another party’s social media site in
an effort to gather potential impeachment evidence so “long as the party’s
profile is available to all members in the network and the lawyer neither
‘friends’ the other party nor directs someone else to do so.”
2.
Tips to Avoiding Ethical Concerns
 If its truly public information, it’s fair use and okay to review, preserve
and use in litigation.
 No deceptive practices should be used to obtain social media information
from plaintifs.
 Attorneys, claims professionals or their agents should not contact an
adverse party through a “friend request” or “tweet” or other similar private
message.
 Contacting a plaintiff’s friends and family? Still up in the air and not
decided, but would appear that would not be contact with an opposing
party and thus no ethical concerns.
 If information is private, consider a subpoena.
16
3.
Liability Concerns
There are legal remedies and protections available to any individual for improper
investigation and privacy concerns.
Stored Communications Act
 1986 – Electronic Communications Privacy Act has restricted certain
kinds of access to data communicated through computer systems. 18 USC
§§ 2701 to 2712
 Title II, known as the Stored Communications Act, prohibits unauthorized
access to remote computing operations and stored electronic
communications in order to protect individual privacy.
 Private right of action exists for a private employer’s knowing or
intentional unauthorized access to social media sties or personal email
accounts.
 Equitable and declaratory relief available, actual and statutory damages
($1,000 per violation) , plus attorney fees and costs
 Punitive damages available for willful or intentional conduct.
Illinois Lawful Products Statute - 820 ILCS 55/5
 State law that protects an applicant’s or employee’s use of lawful
products.
 “it shall be unlawful for an employer to refuse to hire or to discharge any
individual, or otherwise disadvantage any individual, with respect to
compensation, terms, conditions or privileges of employment because the
individual uses lawful products off the premises of the employer during
nonworking hours.”
Illinois’s Social Media Privacy Statute - 820 ILCS 55/10
 “It shall be unlawful for any employer to request or require any employee
or prospective employee to provide any password or other related account
information in order to gain access to the employee's or prospective
employee's account or profile on a social networking website or to demand
access in any manner to an employee's or prospective employee's account
or profile on a social networking website.”
 Public domain information is excluded.
Invasion of Right to Privacy
 Common law tort action if right to privacy has been violated.

17
G.
FUTURE OF SOCIAL MEDIA
Use of social media is not ending anytime soon and a likely medium that is here to stay.
With the increase of mobile accessibility on smart phones, users now incorporate social
media on a minute by minute basis.
 Social platforms are here to stay. Explosion in users reflect that.
 Social Marketing will continue to grow. Businesses are trying to stay on top of
utilizing social media as the new norm for business marketing and incorporating
strategies and software to interact with their customers.
 Digital world will remain. This is not changing and will result in continued social
media platforms that invite plaintiffs for use and us as defense lawyers to
investigate
Bottom Line: as defense attorneys, investigation into social medial information should
also become the norm and used as a tool to assist in the defense of workers’
compensation claims
18
Data Probes, Side Jacking & Fire Sheep: A Preliminary Look at Cyber
Theft Risk, Response, and Insurance Coverage
I.
II.
III.
IV.
The Scope of the Problems – Cyber Risks
Solutions and Protection – Risk Transfer
Insurance Coverage for Cyber Theft
Specialized Cyber Theft Policies – an Overview
INTRODUCTION – Are We Scared Yet?
The electronic internet age has brought quantum leaps in communications between
individuals as well as businesses. It is a primary engine of commerce. With these
advances, unfortunately, have come unanticipated and unexpected challenges and
problems.
You can now buy a smart phone with more computing capabilities than a PC of 10 years
ago, or at least more friendly and accessible capabilities. However, use of such a phone
can expose the owner to spyware installed during a relatively short conversation. Photos
posted and sent on the internet via Twitter and other social media avenues may contain
“geotags” to allow criminals to ascertain location.1 As Albert Einstein said, “we cannot
solve our problems with the same thinking we used when we created them.”
News stories daily recount that data has been taken or computers otherwise compromised
by hackers. See www.advisenfnp.com. The Federal Trade Commission, the federal body
spearheading investigation of data breaches by hackers, recently stated on its webpage
that the public was not to take notices allegedly coming from the FTC as real. The
Pentagon has a cyber crime center, created in 1998, to process data for governmental
clients. The cybercrime center reports that there are millions of external probes into
government computers daily, that the volume has increased annually by 37%. Advisen
Front Page News reported on January 28, 2013, that a little known group known as
“Anonymous” hacked into the United States Sentencing Commission Website. The
intrusion was in response to the death of Aaron Swartz, an “Internet Freedom Advocate”.
The group threatened to release government data.
That same day, January 28th, it was reported that Citizens Bank had its online banking
services disrupted by some individual or group. PNC Bank and JP Morgan had
previously experienced similar problems. A hacker group claimed responsibility and
vowed to continue a six-month campaign to bring down banking websites in the U.S.
That followed a December 7, 2012 attack in which $47,000,000 was stolen from 30,000
banking customers across Europe. www.internetnews.com/security. On December 21,
2012, the highly secretive Council on Foreign Relations website was compromised and
was hosting malicious content. Specifically, the reports stated that “malicious content
does appear to use Adobe Flash to generate a heap spray attack . . .”2
“Drive by cache attacks”, “Zero-Day Threats”, “Pod Slurping”, “worms”, “Trojan
Horse”, “Back-door-Trojan”, “Remote Access Trojan (RAT)”. It is a challenge to try to
wrap one’s mind around this new reality. It requires a new dictionary, which is of course,
on line. www.Technopedia.com. A whole new industry for protecting computers from
invasion has sprung up, with company names such as FireEye, Armorize, SIEM,
eSecurity Planet.
These anecdotal stories and strange new language does not give the true scope of nor
adequately define “cyber theft”. Cyber theft involves any external intrusion into a
business’ computer system to adversely affect the system or to obtain non-public data.
The concept also includes theft of storage devices by employees or others, the most
widely recognized is a “cleaning lady” taking a thumbdrive left on a desk or a laptop
stolen from an employee’s auto.
I. Scope of Risk – Cyber Risks
Cyber thieves steal an estimated tens of billions of dollars worth of data from United
States companies each year. The U.S. Bureau of Economic Analysis estimated the cyber
theft loss in 2011 between $6 billion to $20 billion. A 2009 report listed the loss from
email fraud, theft of trade secrets, computer hacking and extortion at $294.6 million.3
Over 345 million records containing sensitive personal information were involved in
security breaches in the U.S. since January 2005 (as reported in January, 2010). Over
100 million personal records were reported lost or exposed from February, 2005 through
December 2006.4 Over 5,000 Minnesota motorists had their DMV information stolen by
a former Minnesota Department of Natural Resources employee, leading to 2 class action
lawsuits as reported on January 26, 2012. Canadian student loan borrowers are suing in
at least 3 class action suits to recover damages from the Canadian federal government’s
failure to protect personal loan data and other pii.
Not only does the entity holding the personal identifying information face civil lawsuits,
they face suits from the Federal Trade Commission under Section 5 of the Act, for unfair
and deceptive practices. The FTC may seek injunctive relief and monetary redress for
the victims. Wyndam Hotels Worldwide was sued in June, 2012, for three data breaches
over a two year period involving consumer credit card information, where the hotel chain
failed to notify consumers or take measures to reduce the exposure. In 2006, as reported
on the FTC website, an action against ChoicePoint, a “consumer data broker”, was
resolved with ChoicePoint paying a $10,000,000 civil penalty, and $5,000,000 for
consumer redress.
Cyber theft adversely affects business in a number of ways. Customers and others whose
personally identifiable information (“pii”) is obtained by unauthorized system users
subjects the host entity to liability from the individuals whose data was obtained. Class
actions over credit card numbers, social security numbers, and other pii seized or taken
by an external hacker have been filed in state and federal courts, the success of which has
been largely limited by rapid responses from the data holders. Initially, however, is the
cost to the business to determine the true scope of the problem and determine total or
partial solutions. The business must consider public relations fallout. Forty seven states
have cyber theft/data breach notification laws. These require a business to notify its
customers that there has been a breach and that personal identifying information has been
compromised or stolen. Generally, these laws require notice within 30 to 60 days.5
II. Solutions [or at Least Protection]
Obviously, businesses in the possession of the consumer pii need to take serious steps to
preserve the data and reduce the risk of cyber theft, and the scope when it occurs.6 A
sophisticated firewall is required, as well as encryption of data. A current breach risk
assessment is also helpful in defusing scrutiny by the FTC after a breach.
Once a breach occurs, the entity must perform an expedient investigation to determine the
scope and how the breach occurred so that efforts can be taken to eliminate reoccurrence.
Notice to customers or owners of the data has to be made in compliance with the myriad
state and federal laws.7 Those whose pii has been disclosed should be offered identity
theft/credit monitoring services, as well as identity theft insurance, and payment of any
costs to secure new credit card(s). Counsel should be retained to communicate with any
governmental investigators, and to coordinate requests for information from
investigators.
These measures can be expensive for mid to small businesses. In an article
reported in the Washington Post in late 2011, the average cost for a breach to
the business ranges between $5 to $8 million. 8 The 2009 average per
consumer file was $204, although the price is increasing. 9
Risk transfer may protect companies, but at significant cost for more specialized
coverage. Pricing reports for Cyber Risk Coverage suggests $7,000 to $40,000 in
premium for $1,000,000 in coverage. Traditional third party coverage via the
commercial general liability policy, while initially holding promise for insureds, has been
largely removed from the data breach realm via standardized exclusions. First party
policies contain coverage limitations that are problematic to concepts involved in loss of
customer data.
Most commentators in the field suggest a strategy of heightened risk management
coupled with insurance. Placing the risk on an insurance program alone is unlikely to
cover the entire risk, primarily due to multiple retentions and low policy sublimits. Large
enterprises benefit from having an executive level watch dog position created to focus
solely on cyber security. The average per consumer data loss in companies without a
cyber security manager averaged $236 versus $157 with a cyber security manager.10
III. Insurance Coverage for Cyber Theft
1. First Party Coverage – Can Electronic Data Suffer Direct, Physical Loss?
The largest issue with traditional commercial first party coverages is the
requirement for direct physical loss to trigger policy coverage. Newer policies are
also being written with the assumption the insured will buy cyber risk coverage,
which will cover the risks purposely avoided in the property insurance form.11
In Landmark American Insurance Company v. Gulf Coast Analytical
Laboratories, Inc., 2012 U.S.Dist.LEXIS 2012 (M.D.La. 3/30/12), the insured
made claim for loss to data stored electronically. Gulf Coast’s business was to
analyze chemical samples for the petrochemical industry and some governmental
units, via use of a RAID system. The RAID system malfunctioned, leading to a
claimed loss of $112,000 in recovery costs paid by Gulf Coast to third parties, as
well as over $1 million in lost business income. Id., at *3.
Landmark’s inland marine coverage applied to electronic data under an “ISCF”
form. The coverage grant provided, “we cover risks of direct physical ‘loss or
damage’ to Covered Property, including ‘computer viruses,’ except those causes
of ‘loss and damage’ listed in the Exclusions.” Id., at *6. Landmark claimed that
electronic data was not subject to “direct, physical ‘loss or damage’”. Neither
party disputed the meaning of “direct, physical loss”.
Relying in large part on the Louisiana Civil Code of 1870, and the declaration
therein that the perceptibility by any of the senses of a thing rendered it corporeal
in nature, the federal court found electronic data to be physical. While electronic
data is not tangible, it is still physical because it can be observed and altered by
human actions. Landmark, *9 (citing South Cent.Bell v. Barthelemy, 643 So.2d
1240, 1244 (La.1994)). Accord, American Guarantee Liability Ins. Co. v. Ingram
Micro, Inc., 2000 WL 726789 (D.Ariz. 4/18/2000); Southeast Mental Health
Center, Inc. v. Pacific Ins. Co, Ltd., 439 F.Supp.2d 831 (W.D.Tenn. 2006).
Other courts have instead ruled that electronic data is intangible, non-physical
property not capable of suffering a direct, physical loss. See Ward General Ins.
Services, Inc. v. The Employers Fire Ins. Co., 114 Cal.App.4th 548 (2003);
America Online, Inc. v. St. Paul Mercury Ins. Co., 207 F.Supp.2d 459 (E.D.Va.
2002).
In the unpublished, unofficial decision in Greco & Traficante v. Fidelity &
Guaranty Ins. Co., 2009 Cal.App. Unpub.LEXIS 636 (4th Dist. 1/26/09), the court denied
first party coverage for a law firm that claimed loss of billing data based on a power
surge. The problem in that case was that the insured failed to prove any electronic event
or evidence of destruction within the computer system itself. The loss was equally likely
to have been caused by the lack of secretary input of time records into the firm’s
computer system.
2. Coverage Under CGL Policy – Electronic Data and Tangible Property
The insured received a claim from IBM, a customer, when an IBM cart holding
computer data tapes fell out of a van on a highway ramp, and unknown parties took
the tapes. Those tapes contained personal data of more than 500,000 IBM employees.
The dispute as to liability coverage landed in court. Recall Total Information
Management v. Federal Insurance Co., 2012 Conn.Super. LEXIS 227
(Conn.Super.Ct. 1/17/12). No coverage was available, the court held, because the
claim involved loss of electronic data, which was not “tangible property”.
Likewise, the court in Union Pump Co. v. Centrifugal Technologies, Inc., U.S.Dist.
LEXIS 86352 (W.D.La. 9/18/09), held that suit for loss of electronic data containing
design drawings, autocad files and pump models was not covered. No tangible
property was involved, a requirement in the CGL policy. Moreover, there was no
“occurrence” found because plaintiff alleged the insured wrongful took and used the
materials, then destroyed the data. The same allegations triggered the “expected or
intended” policy exclusion.
Both the Recall Total Information and Union Pump cases also involved claims for
advertising injury coverage. Recall Total Information involved claims by the insured
that the taking of the personal employee information involved invasion of privacy.
The court rejected that claim, finding no publication had been made. In the Union
Pump case, the insured argued for “advertising injury” coverage, which was rejected
because there was no evidence of any insured act of advertising.
Commercial general liability coverage was found in the decision in Eyeblaster, Inc. v.
Federal Insurance Company, 613 F.3d 797 (8th Cir. 2010). Eyeblaster, a seeming
business naming fiasco or sandblasting company, was instead a worldwide online
advertising company engaged in “rich media advertising”. A consumer alleged that
Eyeblaster injured his computer, its software, and data after a visit to Eyeblasters site.
Specifically, the consumer alleged Eyeblaster secretly installed spyware on this
computer, causing the computer to immediately freeze up, exhibit slow run speed,
send random error messages, and experience a hijacked browser that communicated
with websites other than directed by the operator. The underlying suit alleged
violation of the federal Computer Fraud and Abuse Act, as well as the Texas
consumer statutes and common law claims including trespass, conversion, conspiracy
and invasion of right of seclusion. Eyeblaster, 613 F.3d, at 800.
The insurer obtained summary judgment from the trial court, on the basis that there
was no claim for loss or damage to tangible property. The tort plaintiff asserted only
damage to software, not the computer hardware. On appeal, the reviewing court
agreed that the allegations in the underlying case did not satisfy the policy
requirement for injury to tangible property. The policy excepted “software, data or
other information that is in electronic form” from the definition of “tangible
property.” Id, at 802. Coverage was found based on language providing coverage for
“loss of use of tangible property that is not physically injured”. The “impaired
property” exclusion was found not to apply because the allegations in the underlying
case included attempts to repair the computer without success.
While not involving a CGL policy, the case of Nationwide Ins. Co. v. Hentz, 2012
U.S.Dist.LEXIS 29181 (S.D.Ill. 3/6/12) involved similar liability coverage provided
by a homeowner’s policy. The insured, an accountant, performed services for a union
pension fund. A CD-Rom belonging to the union, and containing personal
identifiable information of its members, was stolen from the insured’s car.
Thereafter, the union sued the insured in state court for the $200,000 it claimed that it
spent to notify members and for their credit monitoring.
While recognizing that the electronic data on the CD-Rom was intangible property,
and not covered by the homeowners policy, the Nationwide court instead focused on
the medium on which the data was stored. If the homeowner would have had her
computer hacked, and the data taken electronically, there would have been no
coverage because of failure to satisfy the policy requirement of “physical injury to,
destruction of, or loss of use of tangible property.” Summary judgment was denied to
the insurer because the CD-Rom was taken, constituting loss of tangible property.
However, the Nationwide court did find that an exclusion barred coverage. That
exclusion removed coverage for “’[p]roperty damage’ to property . . . in the care of
the ‘insured’.” Nationwide, **12, 13. The court rejected the union’s attempt to argue
the CD-Rom was not within the insured’s care because it was in her car parked
outside her house, but not necessarily on her property.
The widely cited America Online v. St. Paul Mercury Ins. Co., 347 F.3d 89, 95-96
(4th Cir. 2003), held that loss or destruction of electronic data is not “tangible
property” covered under a liability policy.
The issue of CGL coverage for cyber theft now appears to be largely moot due to
exclusions written into CGL forms. Violation of statutes exclusions have been
expanded to include violation of any statute regarding the sending, transmitting,
communicating or distribution of material or information. (ISO CG 00 01 12 07).
Other insurers have manuscript language involving violations of any individual right
to privacy created by statute, appropriation by electronic means of a person’s privacy
rights.12
3. E&O and D&O Policies
Coverage determinations have been reported under Errors & Omissions policies and
Directors & Officers policies. The Eyeblaster decision discussed above also included
an E&O policy form. The dispute under Federal Insurance Company’s Network
Technology Errors or Omissions Liability policy form concerned whether there was a
“wrongful act”. While the trial court found no “wrongful act” because the conduct
alleged was intentional, the appellate court concluded that the conduct alleged was
not “intentionally wrongful”. 613 F.3d, at 804. It pointed to the insurance company’s
own webpage, which utilized Java script and Flash devices, as an example of
common practice. The majority in Eyeblaster also pointed to a stipulation filed as the
underlying Texas state action was being resolved that purported to establish no
evidence of willful, intentional, or otherwise malicious conduct by the insured. Id.
The concurring opinion rejected use of that stipulation as evidence of coverage. See
also St. Paul Fire and Marine Ins. Co. v. Compaq Computer Corp., 539 F.3d 809 (8th
Cir. 2008)(E&O policy provided defense coverage for claims of unintentional sales of
defective computers).
Intentional misconduct was found to bar E&O coverage for an insured where the
underlying allegations included falsification of electronic credit reports in mortgage
applications. New Federal Mortgage Corp. v. National Union Fire Ins. Co. of Pitt.,
543 F.3d 7 (1st Cir. 2008). Directors and Officers coverage was barred for a social
networking website where the claim alleged false representations by website
management as to content protections for children because of a professional services
exclusion. Tagged, Inc. v. Scottsdale Ins. Co., 2011 U.S. Dist. LEXIS 75262
(S.D.N.Y. 5/27/11).
IV. CYBER THEFT POLICIES
There are presently no reported decisions regarding coverage issues arising from
Cyber Theft policies. The discussion presented in this section involves a general
overview of coverage types offered. The current cyber theft policies contain both
first and third party coverage concepts. While the policies are fairly new, having
been developed in the last decade, there are common exposures addressed which can
be summarized as follows:
THIRD PARTY LIABILITY:
Information Security and Privacy Liability
Privacy Notification and Crisis Management Expenses
Regulatory Defense and Penalties – response to governmental
investigations and actions, including state and federal
bodies
Website Media Content Liability – exposure to claims based on content,
including embedded devices
As an example, the Travelers CyberRisk Policy form [CYB-3001 Ed.07-10] contains
three coverages for third party liability, including Network and Information Security
Liability; Communications and Media Liability; and Regulatory Defense Expenses.
The insuring agreement in the Network section provides:
The Company will pay on behalf of the Insured, Loss from any
Claim, other than a Regulatory Claim, first made during the
Policy Period . . . for a Network and Information Security
Wrongful Act.
The term Network and Information Security Wrongful Act is defined to encompass
the exposure for unauthorized computer system access and theft of personal identifying
information, including “failure to prevent unauthorized access to, or use of, electronic or
non-electronic data containing Identity Information.”
Similarly, the AIG CyberEdge policy [AIGPROFCYBER 02 03 12] provides coverage
for Data Liability, including “Network Security” exposures, Loss of Corporate
Information, Outsourcing, and Loss of Personal Information. Hartford Insurance
Company’s CyberChoice 1.0 policy form [CY 00 H003 00 0709] insures for Data
Privacy Wrongful Acts and Network Security Wrongful Acts, encompassing data breach
scenarios.
FIRST PARTY COVERAGE
The First Party coverage encompasses business interruption, electronic-based extortion,
computer-based fraud, and electronic data assets. An example of the extortion insuring
agreement is found within the Landmark American Insurance Company’s “Cy Tech
Confidential” form:
. . . the Company will reimburse the Named Insured . . . for Cyber
Extortion Loss and Cyber Extortion Costs incurred by the Named
Insured. . . as a direct result of a covered Event for a Cyber Extortion
Threat that first takes place during the Policy Period . . . .
The term “Cyber Extortion Threat” is defined as a “credible threat or series of related
threats by anyone other than a principal, officer, partner or director of the Named Insured
. . . which actually affects or threatens to negatively affect the Named Insured’s
Computer System or Website by means of, including but not limited to, a breach of the
Named Insured’s Security Systems; the proliferation of Malicious Code; a Denial of
Service Attack; or theft or unauthorized use of the Named Insured’s Data Assets.”
Cyber Extortion Costs is defined as the Named Insured’s reasonable and necessary costs,
incurred with the insurer’s consent, to respond to the Cyber Extortion Threat. Cyber
Extortion Loss means cash or other valuable thing paid by the Named Insured in response
to a Cyber Extortion Threat, subject to the insurer’s prior written consent.
COMMON TERMS and Concepts Within Cyber Coverage Forms
Similar to Directors and Officers-type policies, the cyber liability forms are fairly
complex. The insuring agreements are fairly short, running no more than two pages, but
the defined terms are extensive. The Travelers form definition section runs the better part
of nine of the form’s 30 pages. Much of the coverage scope appears controlled within
definitions, so that there is no need for a voluminous exclusions section, relatively
speaking. Almost all forms are written on a “claims made” and “duty-to-defend” basis,
with defense costs within limits. All have retentions, with defense costs eroding the limits
and subject to the applicable retention. Most do have consent to settle provisions, which
allows the insured limited ability to forestall settlement, but with a severe downside for
not consenting.
Exclusions are normally found within the cyber liability form for the following:
Criminal and Dishonest conduct
Bodily Injury/Property Damage [except humiliation type damages for
invasion of privacy rights]
Employment-related liability including ERISA
Claims by related companies & insured vs. insured
Contract liability/anti-trust/unfair and deceptive practices
Pollution & Nuclear & Mold, War & Insurrection
Professional Services
Mechanical and Electrical Failure
Unlawful Collection of PII
OTHER Cyber Form Issues & Observations
The use of sublimits is prevalent in cyber liability forms to control the risk taken
by the insurer. Many types of coverages contained therein have no aggregate limits, but
have per claim-applicable retentions. Reporting extensions are generally available. Most
policies have a retroactive date limitation for acts giving rise to claim made within the
policy period.
*
*
*
*
CONCLUSION
Cyber risks are growing in frequency and severity. Commercial enterprises should
review their security systems frequently, and update as technology allows. Hacking and
other theft of personal identifiable information is going to happen so companies should
have an action plan in place to deal with such an event.
One of the ways to spread the risk is by insuring against cyber theft. However, the
current cyber theft liability and response policies are not the panacea of protection that
many executives may think, or desire. The traditional CGL and commercial property
forms are unlikely to provide much protection at all in a data breach/cyber theft scenario.
Cyber liability policies need to be carefully reviewed and tailored to the needs, and risk
appetite, of the purchasing enterprise. The coverage gaps and limitations are not yet fully
known because of the lack of case precedent. Therefore, careful comparison is in order
and consultation with legal counsel is highly recommended.
END NOTES
1
www.privacyrights.org/fs/fs26.cellprivacy.htm contains warnings for consumers about data-tracking and
other unknown harvesting of personal cell phone data.
2
Similar ominous-sounding concepts are involved in the definition of “Fire Sheep”, which “sniffs out
passwords” and such, uses a “packet sniffer” to intercept unencrypted cookies from websites like Facebook
and Twitter, allows the user to instantly take on the login credentials of the user. See Techopedia website,
infra.
3
Cyber Theft Insurance Claims! Really? “rhiclaimsspecialist.com”.
4
Stevens, G., Federal Information Security and Data Breach Notification Laws, Congressional Research
Service, 1/28/10, p.3.
5
The National Conference of State Legislatures maintains a webpage listing the states with notification
laws and links to those statutes. ncls.org-research/telecom/security-breach-notification-laws.aspx.
Generally, the language in the statutes requires notice within the most expedient time possible and without
unreasonable delay [815 ILCS 530/1] , consistent with the needs to first investigate and secure the entity’s
computer system(s). As of late 2012, the NCLS reported only Alabama, Kentucky, New Mexico, and
South Dakota lacked data breach notification laws. Most statutory schemes provide for exceptions to
notice, by providing a substitute, where the reasonable cost exceeds a stated dollar amount and/or number
of persons to be notified. For example, Illinois provides for substitute notice if the cost to provide notice
will exceed $250,000; West Virginia allows substitute notice if the cost will likely exceed $50,000; and
Mississippi allows substitute service if the cost will exceed $5,000. Statutory notice consists of written
notice, telephone notice, and in some cases email notice. Substitute notices includes posting on the entity’s
website, and notification of statewide media in that state. Content of the notice includes providing toll-free
numbers to credit reporting agencies, toll free numbers, address and website to the FTC, as well as date and
approximate time of the event and nature of breach. Some states require the entity to advise of the steps the
entity will take going forward to protect consumer personal identification information. The trigger for
content of data taken requires first name or initial and last name, coupled with either the individual’s social
security number, credit card numbers, bank card numbers with password information.
6
Commentators suggest that with data breach it is a question only of when, not of whether it will occur.
Larry Ponemon, Ponemon Institute, as quoted in Cybersecurity: SEC Outlines, infra.
7
See Note 2. On the federal level, there are various statutes that control based on subject matter, the most
notable is HIPAA and HIGHTECH for medical information. This federal approach is denoted as a
“sectoral approach” to the protection of personal information. Stevens, G., infra, p 1. For publically-traded
companies, Sarbanes-Oxley Act of 2002, Section 404 applies. The SEC has issued guidelines as to when a
publically traded company must report, and how much. CF Disclosure Guidance: Topic No.2, U.S.
Securities and Exchange Commission, 10/13/11.
8
Nakashima, E., and Hilzenrath, D., Cybersecurity: SEC Outlines Requirement that Companies Report
Cyber Theft and Attack, WASHINGTON POST, 10/14/11 (attributing cost estimate to Larry Ponemon for the
Ponemon Institute.
9
Shackelford, S., Cyber Risk Insurance: Valuable, but Not a Magic Bullet, www.strategy-
business.com/article/re00205?pg=all&tid=27782251 (9/14/12).
10
Shackelford, S., supra.
11
Pratt, M., Cyber Insurance Offers IT Peace of Mind – Or Maybe Not,
www.computerworld.com/s/article/9223366 .
12
Elbert, A. and Lamden, S., Closing CGL Cyber Coverage Gaps, THE RISK REPORT, V.XXXIV,
December 2011.
JURISDICTION AND VENUE AFTER THE FEDERAL COURTS
JURISDICTION AND VENUE CLARIFICATION ACT OF 2011
Peter R. Jennetten
Quinn, Johnston, Henderson, Pretorius & Cerulo
227 NE Jefferson Ave.
Peoria, IL 61602
309-674-1133
[email protected]
Peter Jennetten graduated from the Georgetown University Law Center in 1996 and
joined Quinn Johnston Henderson Pretorius and Cerulo. He practices personal injury
defense and increasingly focuses on the defense of cases in federal court, including civil
rights and employment cases. He has been named an Illinois SuperLawyer from 20082013 and recognized as Preeminent AV-rated by Martindale-Hubbell, ISBA Young
Lawyer of the Year and one of Peoria’s 40 Leaders Under 40. He participates in several
defense and legal organizations and serves on the Local Rules Committee for the United
States District Court for the Central District of Illinois.
JURISDICTION AND VENUE AFTER THE FEDERAL COURTS
JURISDICTION AND VENUE CLARIFICATION ACT OF 2011
I. Diversity Jurisdiction
A. Diversity Rule
“The district courts shall have original jurisdiction of all civil actions where the
matter in controversy exceeds the sum or value of $75,000, exclusive of interest and
costs, and” where there is complete diversity. 28 USC §1332(a). If any of the plaintiffs
are from the same state as any of the defendants, there is not complete diversity. This
general principle is unchanged, but the amendments tweaked residency provisions and
the rules pertaining to aliens.
B. Citizenship of Corporations for purposes of Diversity
This section was revised to clarify the status of insurance companies that are
incorporated or have their principal place of business in a foreign state. The previous
version simply referred to “state”, and the current version refers to “State and foreign
state”. The amended statute provides:
(1) a corporation shall be deemed to be a citizen of every State and foreign
state by which it has been incorporated and of the State or foreign state where
it has its principal place of business, except that in any direct action against the
insurer of a policy or contract of liability insurance, whether incorporated or
unincorporated, to which action the insured is not joined as a party-defendant,
such insurer shall be deemed a citizen of—
(A) every State and foreign state of which the insured is a citizen;
(B) every State and foreign state by which the insurer has been
incorporated; and
(C) the State or foreign state where the insurer has its principal place of
business;
Domestic corporations with a principal place of business in a foreign country are
now considered citizens of both their domestic state of incorporation and the foreign
country. Under the old statute, they were often considered only citizens of the domestic
state of incorporation.
Note that the residence of a corporation for the purpose of venue is not the same as
its citizenship for the purpose of diversity jurisdiction, as discussed in the venue section
below.
2
C. Citizenship of Unincorporated Entities for purposes of Diversity
Partnerships, LLCs and unincorporated associations have the citizenship of all of
their members. Grupo Dataflux v. Atlas Global Group, L.P., 541 U.S. 567, 579 (2004) (“the
court ‘looks to’ the citizenship of the several persons composing the entity ...for the
purpose of determining the citizenship of the entity that is a party...”); Harvey v. Grey
Wolf Drilling Co., 542 F.3d 1077, 1080 (5th Cir. 2008) (“like limited partnerships and
other unincorporated associations or entities, the citizenship of a LLC is determined by
the citizenship of all of its members.”); Thomas v. Guardsmark, LLC, 487 F.3d 531, 534 (7th
Cir. 2007).
D. Citizenship of Aliens for purposes of Diversity
Aliens are considered aliens, referred to in the statute as “citizens or subjects of a
foreign state”. The amendments removed the old language in the hanging paragraph at
the end of §1332(a) stating that “an alien admitted for permanent residence shall be
deemed a citizen of the State in which such alien is domiciled.” That language had some
unintended consequences.
E. Alienage Jurisdiction
The amendments removed the “deeming” language in §1332(a), but the drafters still
wanted to make sure that diversity jurisdiction would not include cases between aliens,
so the following language was added:
...the district courts shall not have original jurisdiction under this subsection of
an action between citizens of a State and citizens or subjects of a foreign state
who are lawfully admitted for permanent residence in the United States and are
domiciled in the same State. 28 USC 1332(a).
The intended effect of this language is to remove diversity jurisdiction where an
alien admitted for permanent residence and an opposing U.S. citizen are domiciled in
the same state. Federal diversity jurisdiction is not available at all where there are aliens
on both sides regardless of their residence status. There is significant caselaw
supporting the concept that Article III courts could never have the power to adjudicate
claims between aliens.
The statute clearly provides for jurisdiction when there is an alien on one side and a
citizen on the other. §1332(a)(2). The statute also allows aliens as additional parties
where there is diversity between U.S. citizens. §1332(a)(3). Where there is a U.S. citizen
on one side and aliens on both sides of the litigation, diversity jurisdiction is likely not
available.
3
F. Pleading Jurisdiction
Pleading jurisdiction can be tricky and cases will be remanded if the removing party
does not clearly establish (1) complete diversityand (2) the amount in controversy
exceeding $75,000. For corporations, it is essential to plead both their state of
incorporation and “the” principal place of business. For partnerships, LLCs and
unincorporated associations, the removing party must plead the citizen ship of each
member of those entities. If any of the members is a partnership, LLC or other
unincorporated association, the citizenship of the members of that entity must also be
pled. The principal place of business is irrelevant for unincorporated associations.
G. Diversity cases since the amendments.
Bayerische Landesbank, New York Branch v. Aladdin Capital Management LLC, 692 F.3d
42 (2nd Cir. 2012). The bank sued an investment advisor for losses sustained as a result
of a credit default swap. Bayerische Landesbank, New York Branch filed suit in federal
court claiming diversity jurisdiction and later added its parent, Bayerische Landesbank
as a plaintiff against Aladdin. The Court found that the New York Branch was simply a
division of the bank, rather than a subsidiary, so both were citizens of Germany, having
the bank’s incorporation and principal place of business in Germany.
Aladdin Capital Management LLC (“ACM”) had one member: Aladdin Capital
Holdings LLC (“ACH”). ACH in turn had ten members:
– four U.S. citizens domiciled in the U.S.,
– four U.S. companies with principal places of business in the U.S.,
– one LLC with its principal place of business and three individual citizen partners
domiciled in Connecticut
– one company incorporated in Delaware with its principal place of business in
Tokyo.
At the time suit was filed, the pre-amendment version of §1332(c) remained in effect
and stated that a corporation was a “citizen of any State by which it has been
incorporated and of the State where it has its principal place of business.” The Court
noted that “State” refers only to the 50 states and territories of the US and that a
domestic corporation with its principal place of business abroad is deemed only a
citizen of its state of incorporation. Therefore, the defendants were only US citizens and
the plaintiff only a German citizen and diversity juridiction was proper. Id. at 50-51.
The Court went on to note that the result would have been different under the
amended statute, which treats a corporation as a citizen of both its place of
incorporation and principal place of business, even if the latter is foreign. Since one
4
member of ACM was a company with its principal place of business in Japan and ACM
was a member of ACH, then ACH is also considered a citizen of Japan. Because
diversity does not exist where there are foreign citizens on both sides, the Court would
not have jurisdiction under the amended statute. Id. at 51.
5
II.
Venue
A. Section 1390 generally
Section 1390 defines venue as “the geographic specification of the proper court or
courts for the litigation of a civil action that is within the subject-matter jurisdiction of
the district courts in general, and does not refer to any grant or restriction of
subject-matter jurisdiction providing for a civil action to be adjudicated only by the
district court for a particular district or districts.” 28 USC §1390(a).
The authors of the statute felt that venue could be confused with other statutes
which determine where a case may be brought, but are jurisdictional. The definition
helps clarify the distinction and that this statute does not impair the operation of these
other statutes. The House Report on the bill explained: “Proposed subsection 1390(a)
(‘Venue Defined’) would provide a general definition that distinguishes venue (a
geographic specification of the appropriate forum for litigation) from other provisions
of Federal law that operate as restrictions on subject-matter jurisdiction. Although such
subject-matter restrictions may also include geographic terms, they differ from venue
rules in that they may not be waived by the parties and will not be affected by changes
in Chapter 87’s general venue rules.” H.R. REP. 112-10 at 17.
The distinction between subject matter jurisdiction and venue is important. Subject
matter jurisdiction cannot be waived and can be raised at any point in the litigation
either by the parties or sua sponte by the court or the Appellate Court. Rice v. Rice Found.,
610 F.2d 471, 474 (7th Cir. 1979). Improper venue does not deprive the court of
jurisdiction. Polizzi v. Cowles Magazines, Inc., 345 U.S. 663, 665, 73 S. Ct. 900, 902, 97 L.
Ed. 1331 (1953) (“Section 1391 is a general venue statute. In a case where it applies, if its
requirements are not satisfied, the District Court is not deprived of jurisdiction”).
Subsection (b) of the statute excludes “Admiralty, Maritime and Prize cases.” This
rule codifies Continental Grain Co. v. Barge FBL-585, 364 U.S. 19 (1960) (holding the
general transfer provisions apply to admiralty suits); see also Fed. R. Civ. P. 82 (noting
that an admiralty or maritime claim is not a “civil action” for purposes of the venue
statute). In these cases, “the general admiralty practice prevails, in which venue and
personal jurisdiction analyses merge. If the action is in personam, venue lies wherever
valid service could have been made upon the defendant.” In re McDonnell-Douglas
Corp., 647 F.2d 515, 516 (5th Cir. 1981).
B. Cure for improper venue vs. waiver
Objections to venue can be waived by failure to object or by contract. Any objection
to venue must be raised in the first pleading filed or it may be deemed waived (Fed. R.
6
Civ. P. 12(b)(3) (venue is one of the listed defenses under 12(b) which must be raised)
and 12(h)(1) (defenses not raised are waived). This is also addressed by the statute:
“Nothing in this chapter shall impair the jurisdiction of a district court of any matter
involving a party who does not interpose timely and sufficient objection to the venue.”
28 USC 1406(b). Objections to venue can also be waived by contract. Heller Financial, Inc.
v. Midwhey Powder Co., 883 F.2d 1286, 1293 (7th Cir. 1989)(holding that one of 1404(a)’s
factors — convenience of the parties — allows a party to contractually waive their right
to assert their own inconvenience as a reason for transfer of venue).
If there is an objection, improper venue can be cured by transfer to or refiling in the
proper court. 28 USC 1406(a): “The district court of a district in which is filed a case
laying venue in the wrong division or district shall dismiss, or if it be in the interest of
justice, transfer such case to any district or division in which it could have been
brought.” If the case is dismissed, a refiling of the case in the proper venue will not
relate back for purpose of the statute of limitations. If the statute of limitations has run,
the Court should transfer the case in the interest of justice. Burnett v. New York Cent. R.
Co., 380 U.S. 424, 430 (1965); Gold v. Griffith, 190 F. Supp. 482, 483 (N.D. Ind. 1960).
Transfer is discretionary with the court, however, and a case may be dismissed for
improper venue even if the statute of limitations has run and the plaintiff will be unable
to file a timely suit in the proper venue. Cont’l Ins. Co. v. M/V ORSULA, 354 F.3d 603,
607-08 (7th Cir. 2003) (dismissing case filed in wrong venue despite clear forum selection
clause in bills of lading).
C. The statute does not change procedure for removal.
Cases must be removed to the District Court where the state action is pending (e.g.,
a state case filed in Peoria County must be removed to the Central District of Illinois,
Peoria Division). 28 USC §1441(a). Subsection (c) makes clear that the venue statute
does not change the removal procedure: “This chapter shall not determine the district
court to which a civil action pending in a State court may be removed...”
This codifies the existing practice set forth in Polizzi v. Cowles Magazines, Inc., 345
U.S. 663, 665–66 (1953) (venue removed in cases is controlled by the removal statute,
rather than the general venue statute). Polizzi filed suit in the Circuit Court for Dade
County, FL against a national corporation and the case was removed to the District
Court for the Southern District of Florida and dismissed under 28 U.S.C. § 1391 (general
venue) for want of jurisdiction. The Supreme court held that section 1391 had no
application in this case because it was a removed action. Polizzi, 345 U.S. at 665. Section
1391 deals with where an action may be brought. Id. This action was not “brought” in
the District Court. The action was brought in state court and removed to the Dist. Ct. Id.
at 666. The venue of removed actions is governed by 1441(a). Id. at 665. Section 1441(a)
expressly provides that the proper venue of a removed action is “the district court of
7
the United States for the district and division embracing the place where such action is
pending.” Id. at 666.
The new venue statute states that it governs all actions “brought” in the District
Courts. Because removed cases are not “brought” in the District Court, the venue
statute does not apply. As in Polizzi, the case properly removed cannot then be
dismissed for lack of venue. It can be transferred, as the transfer statute applies to “any
civil action.” 28 USC §1404(a); see also, Hollis v. Florida State University, 259 F.3d 1295,
1300 (11th Cir. 2001) (noting the availability of transfer following removal of a case to
Federal court); Bentz v. Recile, 778 F.2d 1026, 1027–1028 (5th Cir. 1985) (permitting
removal and transfer for convenience of the parties even where action was removed
from a state court that may have lacked jurisdiction over the defendant); Kinney v.
Anchorlock Corp., 736 F. Supp. 818, (N.D. Ill. 1990)(granting a motion for transfer of
venue after removal).
D.
Section 1391 – Proper venue of civil actions
1. Section 1391(a) – Creating a unified venue rule
Old §1391 created slightly different rules for diversity and federal question cases
which are consolidated with the new unitary standard. Former 1391(a) applied to
diversity actions and 1391(b) applied to all other actions, primarily federal question
cases. The old sections were substantially identical, differing only slightly in the fallback
provisions applicable when no other venue was appropriate. Old 1391(a) provided for
fallback venue in “a judicial district in which any defendant is subject to personal
jurisdiction” and 1391(b) provided for venue “a judicial district in which any defendant
may be found...”
Some statutes have their own peculiar venue rules. This general venue statute is
intended to reduce the need for statute-specific rules, which will simplify things for
both the courts and attorneys. H.R. REP. 112-10 at 18 (“A general venue statute may
provide greater uniformity and lessen the need for special venue provisions in titles
other than title 28.”).
The amendment also abrogates the old “local action rule.” H.R. REP. 112-10 at 18.
Under the local action doctrine, courts may not exercise jurisdiction over any “local”
action involving real property unless the property at issue is found within the territorial
boundaries of the state where the court is sitting. Bigio v. Coca-Cola Co., 239 F.3d 440,
449-50 (2nd Cir. 2000). The rule is common law that has been taken to require that “a
suit, with federal jurisdiction based on diversity of citizenship, to recover damages for
[a] defendant’s alleged trespass upon, and unlawful use and occupation of, land in [a
foreign country] . . . not be maintained in any jurisdiction except that in which the land
8
was located.” Id. at 450 (quoting Pasos v. Pan American Airways, Inc., 229 F.2d 271 (2nd
Cir. 1956)). The local action doctrine created problems for plaintiffs trying to assert their
property rights outside of where their land is located. For instance, in Ellenwood v.
Marietta Chair Co., the Supreme Court held that an action for trespassing on land in
West Virginia could not be maintained in a federal court in Ohio. 158 U.S. 105, 108
(1895). For a general discussion of the old rule, see 14D Fed. Prac. & Proc. Juris. § 3822
(3d ed.) (describing the development of the local action rule and the distinction between
local and transitory cases). The House Report explained:
“New paragraph 1391(a)(2) would end the use of the ‘local action’ rule, which
provides that certain kinds of actions pertaining to real property may be
brought only in the district in which the property is located. Such actions,
deemed ‘local,’ differ from the transitory actions that may be brought in any
court with jurisdiction over the dispute and parties. The rule has primarily
caused problems in disputes over suits for damages due to a trespass, because
the district court may not be able to exercise personal jurisdiction over the
defendant in the place where the property is located. Thus, in such situations,
a plaintiff would not be able to pursue his or her case.” H.R. REP. 112-10 at
18.
As noted in the ALI Project, “[t]he virtually unanimous view of modern opinion is
that the local-action rule serves no useful function as a device for allocating venue
among the Federal courts. It is largely a creature of decisional law. . . .” ALI Project at
169. See, e.g., Bigio v. Coca-Cola, 239 F.3d 440, 449-450 (2nd Cir. 2000) (tracing local action
rule to Livingston v. Jefferson, 15 Fed. Cas. 660 (C.C.D.Va. 1811)). H.R. REP. 112-10 at 18.
Statutory restrictions on jurisdiction continue to apply. H.R. REP. 112-10 at 18-19.
The new statute addresses these problems with a unitary standard for venue. 28
USC §1391(a) (“Except as otherwise provided by law (1) this section shall govern the
venue of all civil actions brought in district courts of the United States; and (2) the
proper venue for a civil action shall be determined without regard to whether the action
is local or transitory in nature.”). This provides a single venue rule for most cases, but
preserves more specific venue rules contained in other statutes and eliminates the “local
action rule.”
2. Section 1391(b) - Venue in general
The old section could have the unintended consequence of dragging individual
defendants to far-off jurisdictions when they are joined with other defendants,
particularly corporations:
9
“Presently, the language of paragraphs 1391(a)(1) and (b)(1) makes venue
proper in ‘a judicial district where any defendant resides, if all defendants
reside in the same State.’Literally applied, this language could have
unintended consequences. For example, consider a suit brought against both
a resident (natural person) in Illinois and a corporation that does substantial
business in every state, including Illinois, and the litigation arose from events
that occurred in Illinois. Under current subsection 1391(c), the corporation
could be considered a resident of Illinois and every other state, by virtue of its
being subject to personal jurisdiction in all those states. A plaintiff might sue
both defendants in any other district where the corporation happens to
reside, such as the Southern District of New York, on the theory that, because
all defendants reside in the same state (Illinois) as provided in 28 U.S.C. Sec.
1391(a) and (b), venue is proper in any other district where ‘any defendant
resides.’ Proposed paragraph 1391(b)(1) would alter the statutory language to
preclude such a result, while achieving the intended goal of the original
statute.” H.R. REP. 112-10 at 19.
This problem may have been more theoretical than real (the court would still have to
obtain personal jurisdiction over the individual defendant), but the problem was fixed
in the new venue statute, which provides:
(b) Venue in General. — A civil action may be brought in —
(1)
a judicial district in which any defendant resides, if all
defendants are residents of the State in which the district is
located;
(2)
a judicial district in which a substantial part of the events or
omissions giving rise to the claim occurred, or a substantial part
of property that is the subject of the action is situated; or
(3)
if there is no district in which an action may otherwise be
brought as provided in this section, any judicial district in
which any defendant is subject to the court’s personal
jurisdiction with respect to such action.
If the case involves multiple defendants from different states, venue must be
determined by subsection (2) or (3). Subsection (1) applies only where the defendants
are all residents of the same state. The new rule is discussed in Phillips v. Wexford Health
Sources, Inc., 11 C 2701, 2012 WL 1866377, at *2 (N.D. Ill. May 22, 2012) (finding venue
was proper in the Northern District because one defendant was a resident of the
10
northern district and all other defendants were residents of Illinois, even though the
other defendants did not reside in the northern district).
Section 1391(b)(2) keeps the familiar language that venue is proper “a judicial
district in which a substantial part of the events or omissions giving rise to the claim
occurred, or a substantial part of property that is the subject of the action is situated.”
This rule is unchanged from the old sections 1391(a)(2) and (b)(2). See, Indianapolis Colts,
Inc. v. Metro. Baltimore Football Club Ltd. P’ship, 34 F.3d 410, 411–12 (7th Cir. 1994)
(holding venue was proper in Indiana because the trademarks being defended by the
Colts mainly resided in Indiana and would be primarily injured in Indiana). Given that
subsection (1) is more restrictive than the prior statute, the new statute will require that
more cases be filed where the incident occurred rather than were the defendants reside.
Section 1391(b)(3) provides a single fallback position for venue, replacing the
slightly different standards for diversity and federal question cases in the old statute. If
venue is not proper elsewhere, cases may be brought “any judicial district in which any
defendant is subject to the court’s personal jurisdiction with respect to such action.”
3. Section 1391(c)(1) – Residence of an individual for venue
The old statute referred to where the defendant “resides” rather than the
defendant’s “domicile,” which led some courts to define residence more broadly than
domicile. Thus, individuals could be considered a resident of a state or district where
they were not domiciled. H.R. REP. 112-10 at 20-21; Arley v. United Pac. Ins. Co., 379 F.2d
183, 185, n.1 (9th Cir. 1967) (citizens of Nevada were residents of and properly sued in
Oregon). A majority of courts interpreted “resides” to be the defendant’s domicile,
borrowing the approach that governs citizenship for purposes of diversity of citizenship
jurisdiction. However, a minority of circuit courts (Second, Ninth and Tenth)
interpreted residence more broadly than citizenship and permitted a defendant to be
considered a resident of a state where the defendant was not permanently domiciled
(i.e. venue could be proper in a place where defendant had a summer home). H.R. Rep.
112-10 at 20-21.
The amendment fixed this problem by defining residence as the person’s domicile.
28 USC §1391(c)(1) (“a natural person, including an alien lawfully admitted for
permanent residence in the United States, shall be deemed to reside in the judicial
district in which that person is domiciled”).
This section also now applies to resident aliens, who were previously addressed
under subsection (c)(3), which is now limited to non-resident aliens. A legal resident
alien is now treated the same as citizens for purposes of venue (but not for diversity
jurisdiction).
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4. Section 1391(c)(2) – Residence of an entity for venue
The old 1391(c) addressed the residence of corporations, but not unincorporated
associations and other entities. Courts were split on whether old 1391(c) applied to
unincorporated associations, such as unions, or whether they remained subject to
Denver & Rio Grande W. R. Co. v. Brotherhood of Railroad Trainmen, 387 U.S. 556 (1967).
H.R. REP. 112-10 at 21-22. Denver and Rio Grande held that the Brotherhood could be
sued in any district in which it was doing business.
The amendment provides a uniform rule applicable to all entities including
corporations, LLCs, partnerships and unincorporated associations. 28 USC §1391(c)(2);
H.R. REP. 112-10 at 21-22.
(2)
an entity with the capacity to sue and be sued in its common name
under applicable law, whether or not incorporated, shall be deemed to
reside, if a defendant, in any judicial district in which such defendant
is subject to the court’s personal jurisdiction with respect to the civil
action in question and, if a plaintiff, only in the judicial district in
which it maintains its principal place of business;
Note that the entity’s residence is different when the entity sues as a plaintiff, versus
when it is sued as a defendant. As a plaintiff, it resides only where it has its principal
place of business. This will be significant in the uncommon situation where venue may
be a function of the residence of the Plaintiff. The House reports note that these venue
rules continue the trend away from the plaintiff-oriented venue and toward a focus on
the convenience of the defendant. H.R. REP. 112-10 at 22.
5. Section 1391(c)(3) – Venue residence of non-U.S. residents
The old 1391(d) provided that an alien could be sued in any district, denying aliens a
venue defense even if they were permanent residents domiciled in the U.S. The new law
shifts the focus from alienage to residence. H.R. REP. 112-10 at 22-23. New 1391(c)(1)
applies to permanent resident aliens domiciled in the U.S. and treats them like U.S.
citizens. Their residence is the state of their domicile.
Non-resident aliens are disregarded if there are other defendants who reside in the
U.S. (i.e. you cannot add a non-resident alien and choose to file the case in any district
court). Subsection(c)(3) allows venue in any district when the only defendants are nonresident aliens or U.S. citizens domiciled abroad. Any defendant who is not a resident
of the U.S. is governed by this section. 28 USC §1391(c)(3) (“a defendant not resident in
the United States may be sued in any judicial district, and the joinder of such a
defendant shall be disregarded in determining where the action may be brought with
respect to other defendants.”).
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5. Section 1391(d) – Residence in states with more than one
judicial district
The language of this section was taken from the old section 1391(c) to address the
residence of corporations (but not other entities) in states having more than one judicial
district. The practice in this respect is unchanged.
6. Section 1391(e) regarding suits against officers and
employees of the federal government is unchanged.
See, Reuben H. Donnelley Corp. v. F.T.C., 580 F.2d 264 (7th Cir. 1968).
7. Section 1391(f) regarding suits against foreign states is
unchanged.
See, Rush-Presbyterian-St. Luke’s Medical Center v. Hellenic Republic, 877 F.2d 574 (7th
Cir. 1989).
8. Section 1391(g) regarding multiparty, multiform cases is
unchanged.
See, Laukus v. U.S., 691 F.Supp.2d. 119, 126–27 (D.D.C. 2010)(holding 1391(g) was
inapplicable).
9. Other statutes govern venue for certain actions.
There are statutes that address venue for specific actions (over 200 according to
ALI). A special venue statute will control over the general venue statutes found in
§1391. 14D Charles Alan Wright et al., Federal Practice & Procedure § 3803 (3d ed.
2012). When there is a conflict between two special venue statutes, the venue provisions
in the statute of narrower application usually will control over a statute that covers a
broader range of cases, regardless of the relative priority of the statutes’ enactments. Id.
One illustrative case is Radzanower v. Touche Ross & Co., 426 U.S. 148 (1976), in which the
Supreme Court held that when a national bank is charged with violating the Securities
and Exchange Act of 1934, the venue provisions of the National Bank Act control over
the venue rules of the broader Securities and Exchange Act. Id. The Court wrote that
“where there is no clear intention otherwise, a specific statute will not be controlled or
nullified by a general one, regardless of the priority of enactment.” Id. The Court noted
that the National Bank Act was established to address the “particularized problems” of
the national banks, whereas the Securities and Exchange Act was intended to promote
fair dealing in the securities markets; thus, the application of the venue rules found in
13
the former act would not undermine the latter act’s general goal of regulating the
securities markets. Id.
One common special venue provision is the Clayton Act, 15 U.S.C. § 22, which
provides that “Any suit, action, or proceeding under the antitrust laws against a
corporation may be brought not only in the judicial district whereof it is an inhabitant,
but also in any district wherein it may be found or transacts business.” This provision is
discussed in Tiger Trash v. Browning-Ferris Indus., 560 F.2d 818, 824 (7th Cir. 1977)
(Noting that it was Congress’ intent in passing the Clayton Act to liberalize the
restrictive venue provisions of the Sherman Act). The general venue statute in §1391
will not control cases based upon the Clayton Act.
E. Section 1392 repealed
Since the amendments abolish the local-action rule, this section was deemed
unnecessary and repealed. The old local action rule is discussed in Raphael J. Musicus,
Inc. v. Safeway Stores, Inc., 743 F.2d 503 (7th Cir. 1984) (holding “in order to provide in
rem relief, the court must have jurisdiction over the real property at issue, and a local
action must therefore be brought in the jurisdiction in which that real property is
located”). This case demonstrates how the old §1392 indirectly incorporated the
common law local action rule. Because it incorporated the local action rule, the old
§1392 created confusion on whether actions of a local nature were defined by state or
federal law. As the Seventh Circuit in Musicus held, “while a determination of proper
venue is clearly a matter of federal law, it is unclear whether the federal statute should
be interpreted by reference to general law, including the decisions of both state and
federal courts, or by reference specifically to the law of the forum state, in this case
Illinois. Issues involving real property are often resolved by reference to state law, and
thus a strong argument for adopting the law of the forum can be made.” Id. at 506. This
problem no longer exists.
F. An example
Suppose the plaintiff from Michigan, driving his car through Chicago is struck by a
truck from Iowa. The truck is owned by an Iowa corporation with its principal place of
business in Bettendorf, Iowa, where the truck driver also resides. Plaintiff wishes to
make a federal case against the driver and his employer. Where is venue proper? Under
§1391(b)(1), suit could be filed in the District Court for Northern District of Iowa, as all
of the defendants are residents of Iowa. Under §1391(b)(2) suit could be filed in the
Northern District of Illinois, where the accident occurred.
Suppose instead that the driver of the truck resides in Madison, Wisconsin and that
the trucking company operates only in Illinois and Iowa. Because the defendants are
14
not residents of the same state, venue is not proper in either Iowa or Wisconsin under
subsection (b)(1), but remains proper in the Northern District of Illinois under (b)(2).
15
III. Removal
A. Amendments to §§1441 and 1446
Section 1441 is now applicable only to civil cases. The amendments codified the
“forum defendant” rule prohibiting removal of diversity cases if any of the defendants
is from the forum state. The statute now provides that “A civil action” based on
diversity “may not be removed if any of the parties in interest properly joined and
served as defendants is a citizen of the State in which such action is brought.” 28 USC
§1441(b)(2). This may lead to disputes regarding whether certain defendants were
“properly joined” or whether they have been served.
The amendment also codifies the uniform consent rule, requiring the consent of all
of the defendants to remove the case. §1446(b)(2). Each defendant has 30 days from the
date of service to remove the case. If a later-served defendant decides to remove the
case, any earlier-served defendant can consent to removal even though they did not
attempt to remove the case themselves.
The statute allows removal within 30 days of the receipt of “an amended pleading,
motion, order or other paper” making a non-removable case removable. §1446(b)(3).
Removal is precluded if the case has been pending for more than one year, a limitation
now contained at §1446(c). This limitation does not apply if the court finds that the
plaintiff deliberately failed to disclose the actual amount in controversy. §1446(c)(3).
The amendment addresses the difficulties in determining whether a removed action
meets the amount in controversy requirement. A plaintiff’s allegation in the complaint,
if made in good faith, is determinative. §1446(c)(2). The removing defendant can allege
the amount in controversy if the state practice does not permit an adequate allegation of
the amount in controversy or the plaintiff seeks non-monetary relief (§1446(c)(2)(A)),
but the court must find by a preponderance of the evidence that the amount in
controversy does exceed the jurisdictional limit. If the amount in controversy cannot be
determined at the time of filing, information of record in the state case or obtained in
discovery is considered “other paper” making the case removable at that time.
§1446(c)(3)(A).
The amendments also narrowed the scope of claims that can be brought along with
cases removed on the basis of a federal question. If the suit includes a federal question
claim and a claim that is not within the original (§1331) jurisdiction or supplemental
(§1367) jurisdiction, the case can be removed, but the court is required to sever and
remand the non-removable claims. Only defendants in the removable claims must
consent to the removal, since the others will be sent back to state court anyway.
§1441(c)(2).
16
C. Removal cases since the amendments.
Assaf v. Trinity Medical Center, 696 F.3d 681 (7th Cir. 2012). Dr. Assaf sued his former
employer, Trinity Medical Center, in Illinois state court for breach of his employment
contract. Assaf is a foreign national from Syria. Trinity is a hospital with its principal
place of business in Illinois. Trinity removed the case to federal court. The parties are
diverse and the amount in controversy was met. The 7th Circuit found that removal was
improper because Illinois is Trinity’s home state. A defendant cannot remove a case
from its home state courts: “removal is proper only if ‘none of the... defendants is a
citizen of the State in which such action is brought.’” Id. at 685 (quoting 28 USC
§1441(b)). The court also found that the error was procedural, not jurisdictional and that
Dr. Assaf waived his right to object by failing to do so within 30 days. Id. (quoting 28
USC §1447(c)).
Benson v. Unilever U.S. Inc. – F.Supp.2d – (S.D. Ill. 2012) was remanded to state court
because one of the defendants failed to consent to removal within 30 days. Benson sued
Unilever Illinois Manufacturing and it’s parent, Unilever United States, and Wal-Mart
Stores, Inc. because of a foreign object in his peanut butter. Wal-Mart and Unilever
Illinois removed the case and asserted that Unilever U.S. had not been served. Benson
filed an affidavit showing that Unilever U.S. was served on December 19, 2011 and
Unilever U.S. filed a notice of consent to removal on January 23, 2012 – more than 30
days after they were served. Applying the old statute, the court found the consent too
late.
Meyn America LLC v. Omtron USA LLC, 856 F.Supp.2d 728 (M.D.N.C. 2012). Meyn
sued Omtron in North Carolina state court and Omtron removed the case claiming
diversity jurisdiction. Meyn moved to remand. The court noted that each of the parties
was an LLC and some of their members were LLCs and directed that Omtron file an
amended petition for removal setting forth the residence of each member of the party
LLCs and the residence of the members of LLCs who were members of Meyn America
or Omtron LLC. The sole member of Omtron was a foreign corporation with “a”
principal place of business in Cyprus. It failed to allege whether “foreign corporation”
referred to a state other than North Carolina or to a foreign nation. It also failed to
allege that Cyprus was “the” principal place of business. It did not identify any of the
members of Meyn America’s LLC.
Perez v. Forest Laboratories Inc., – F.Supp.2d –, 2012 WL 4811123 (E.D. Mo. 2012). Perez
sued Forest Laboratories and Forest Pharmaceuticals in Missouri state court.
Laboratories is a Delaware Corporation with its principal place of business in New
York. Pharmaceuticals is a Delaware Corporation with its principal place of business in
Missouri. Six days after suit was filed and before summons was issued for either of the
defendants, Laboratories removed the case to the Eastern District of Missouri, claiming
17
diversity jurisdiction. While the forum defendant rule of 28 USC §1441(b)(2) precludes
removal where a defendant resident of the forum state has been “joined and served”,
Laboratories asserted that it was entitled to remove because Pharmaceuticals had not
been served. The court found Laboratories gamesmanship unamusing, enforced the
forum defendant rule and remanded the case back to state court.
Tilley v. Tisdale, – F.Supp.2d –, 2012 WL 6725911 (E.D.Tex 2012). Tilley filed claims for
breach of contract, tortious interference with contract and business relationship, breach
of fiduciary duty and conspiracy against Cash Money Records, Universal Music, Paul
Tisdale d/b/a Green Light Music and Young Money Records entertainment. Cash
Money and Universal Music removed the case to federal court and Tilley moved to
remand, contending that the removing defendants failed to obtain the consent of
Tisdale. The Court noted that the 2011 amendments codified the rule of unanimity
requiring all defendants to consent to removal. The court found that Tisdale had been
served and that the removing defendants failed to establish his consent to removal. The
court found that his failure to object to removal or respond to emails from the removing
defendants was insufficient to establish consent.
18
IV.
Transfer of Venue
A. Section 1404(a)
Old 1404(a) limited transfers to districts where the case could have been filed. This
excluded other districts which might be more convenient for the parties. The
amendment adds a clause allowing the parties to consent to a district other than one
where the case could have been filed originally:
(a)
For the convenience of parties and witnesses, in the interest of justice, a
district court may transfer any civil action to any other district or
division where it might have been brought or to any district or
division to which all parties have consented.
Note that a case cannot be filed in such a district initially. It must be filed in a district
with proper venue and then transferred. The consent clause maintains the requirement
from the beginning of 1404(a) that the transfer be “for the convenience of parties and
witnesses” and “in the interest of justice.” You cannot stipulate to a transfer to Puerto
Rico unless you can show that it is convenient for the parties and witnesses and in the
interest of justice.
Section 1404(a) is discussed in Research Automation, Inc. v. Schrader-Bridgeport Intern.,
Inc., 626 F.3d 973 (7th Cir. 2010) (upholding transfer of case from Illinois to Virginia). In
that case, the Seventh Circuit provided that “a substantial degree of deference is given
to the District Court in deciding whether transfer is appropriate.” Id. at 977–78. With
respect to the “convenience of parties and witnesses” evaluation, the following factors
were provided: availability of and access to witnesses, each party’s access to and
distance from resources in each forum, the location of material events, and the relative
ease of access to sources of proof. Id. at 978. The “interest of justice” factors included:
docket congestion, likely speed to trial in the transferor and potential transferee forums,
each court’s relative familiarity with the relevant law, the respective desirability of
resolving controversies in each locale, and the relationship of each community to the
controversy. Id.
Note that the statute applies to “any civil action” including removed cases or other
cases that are not within the general venue statute. Even cases whose venue is
determined by other statutes (e.g., admiralty law) may be transferred under this section.
In re McDonnell-Douglas Corp., 647 F.2d 515, 516 (5th Cir. 1981).
Also note that §1404 applies only to cases which were originally filed in an
appropriate venue. Cases which are filed in the wrong venue are subject to dismissal or
transfer under 28 U.S.C. §1406.
19
B.
Section 1404(b) regarding transfer to a different division
within the same district is unchanged.
C.
Section 1404(c) regarding the location of trial within a
district is unchanged.
D.
Section 1404(d)
With the change to allow consent to venue under subparagraph (a), this section
would have allowed transfer from Article III courts to certain territorial courts which
are not Article III courts. H.R. REP. 112-10. This was for some reason deemed
undesirable. The flaw was fixed by defining the term “district court” to include “District
Court of Guam, the District Court for the Northern Mariana Islands, and the District
Court of the Virgin Islands” unless you want to transfer a case there. If you want to
transfer to there, they do not count as District Courts. The statute now provides:
(d)
Transfers from a district court of the United States to the District Court
of Guam, the District Court for the Northern Mariana Islands, or the
District Court of the Virgin Islands shall not be permitted under this
section. As otherwise used in this section, the term “district court”
includes the District Court of Guam, the District Court for the
Northern Mariana Islands, and the District Court of the Virgin Islands,
and the term “district” includes the territorial jurisdiction of each such
court.
E. Transfer cases since the amendment.
Caldera Pharmaceuticals Inc. V. Los Alamos National Security, LLC, 844 F.Supp.2d 926 (N.D.
Ill. 2012). Caldera filed suit against several defendants arising out of a dispute over the
licensing of certain technology. Los Alamos National Security LLC (LANS) moved to
transfer the case from Illinois to New Mexico. The Court found that venue was proper
in Illinois for Caldera’s claims against Uchicago Argonne LLC and LANS, who
allegedly conspired to deprive Caldera of exclusive use of the technology because a
substantial part of the events occurred in Illinois. The court found that venue was not
proper with respect to its claims against LANS for fraudulent concealment and
fraudulent inducement. LANS and Caldera are both New Mexico Corporations with
principal offices in New Mexico. Argonne is an Illinois LLC. The court weighed factors
and transferred the case to New Mexico.
I disagree in part with the court’s analysis in Caldera Pharmaceuticals, though the
ultimate result is sound. FRCP 2 and 3 refer to a single form of action, the “civil action.”
The venue statute refers to the proper venue for “civil actions”, not for particular claims
20
within an action. If the claims and parties are properly joined under FRCP 18, 19 and 20,
they are a single civil action. Venue for the action is either proper or not. The court’s
assertion that venue was improper for certain claims is incorrect. Since a substantial
part of the events occurred in Illinois, venue would be proper in Illinois under 28 USC
§1391(b)(2). A substantial part of the events also occurred in New Mexico, meaning that
New Mexico is also a proper venue and that the court could, under §1404, transfer
venue to the New Mexico District Court as it did.
Greatamerica Leasing Corp. v. Avery Air Conditioning/Heating & A-Abaca Services Inc., 2012
WL 443586. Greatamerica filed suit against Avery in the U.S. District Court for the
Northern District of Iowa claiming diversity jurisdiction. Greatamerica is an Iowa
company with its principal place of business in Iowa. Avery is a Texas Corporation with
its principal place of business in Texas. For venue purposes, a corporation resides
everywhere that it is subject to personal jurisdiction. 28 USC §1391(c)(2). In its contract
with Greatamerica, Avery consented to jurisdiction in Iowa, making venue proper in
Iowa. Relying heavily on the parties forum selection clause, the court found that the
factors weighed in favor of denying transfer and refused to transfer the case to Texas.
In re Atlantic Marine Const. Co., 701 F.3d 736 (5th Cir. 2012). Atlantic Marine obtained a
contract with the Corps of Engineers to build a child development center at Ft. Hood. It
subcontracted some of the work to J-Crew Managment, who later sued Atlantic Marine
in the Western District of Texas for breach of contract. Atlantic sought to have the case
dismissed or transferred to Virginia. The contract contained a forum selection clause,
and the court held that Section 1404(a) was the proper device to enforce it (taking a
minority view). The court also placed the burden of proof on the motion to transfer on
the movant, rather than the party seeking to avoid the forum selection clause. Despite
the significant weight given to the forum selection clause in weighing the factors under
Section 1404, the court upheld the District court’s denial of the motion to dismiss or
transfer. There was a well-written dissent arguing that the forum selection clause
should have been enforced, as venue was proper under the statute in either forum.
21
V. Effective Date
The amendments apply to actions filed on or after January 7, 2011, regardless of
when they are removed to federal court. Pub. L. 112–63, title II, § 205,Dec. 7, 2011, 125
Stat. 764, provided that:
The amendments made by this title (1) shall take effect upon the expiration of
the 30-day period beginning on the date of the enactment of this Act [Dec. 7,
2011]; and (2) shall apply to – (A) any action that is commenced in a United
States district court on or after such effective date; and (B) any action that is
removed from a State court to a United States district court and that had been
commenced, within the meaning of State law, on or after such effective date.
VI.
Additional reading
A. House Report on H.R. 394 – H.R. REP. 112-10, H.R. Rep. No. 10, 112TH Cong., 1st
Sess. 2011, 2011 WL 484052, 2011 U.S.C.C.A.N. 576.
B. American Law Institute, Federal Judicial Code Revision Project, Part III,
Removal, (2004) (ALI Project).
22
Side-by-side comparison of old and new statutes (all are 28 USC)
New §
1332 (a)
Old Text
New Text
(a) The district courts shall have original
jurisdiction of all civil actions where the
matter in controversy exceeds the sum or
value of $75,000, exclusive of interest and
costs, and is between—
(1) citizens of different States;
(2) citizens of a State and citizens or subjects
of a foreign state;
(3) citizens of different States and in which
citizens or subjects of a foreign state are
additional parties; and
For the purposes of this section, section
1335, and section 1441, an alien admitted to
the United States for permanent residence
shall be deemed a citizen of the State in
which such alien is domiciled.
(a) The district courts shall have original
jurisdiction of all civil actions where the
matter in controversy exceeds the sum or
value of $75,000, exclusive of interest and
costs, and is between—
(1) citizens of different States;
(2) citizens of a State and citizens or subjects
of a foreign state, except that the district
courts shall not have original jurisdiction
under this subsection of an action
between citizens of a State and citizens or
subjects of a foreign state who are
lawfully admitted for permanent
residence in the United States and are
dom iciled in the same State;
(3) citizens of different States and in which
citizens or subjects of a foreign state are
additional parties; and
(4) a foreign state, defined in section 1603
(a) of this title, as plaintiff and citizens of a
State or of different States.
(b) Except when express provision therefor
is otherwise made in a statute of the United
States, where the plaintiff who files the case
originally in the Federal courts is finally
adjudged to be entitled to recover less than
the sum or value of 75,000, computed
without regard to any setoff or
counterclaim to which the defendant may
be adjudged to be entitled, and exclusive of
interest and costs, the district court may
deny costs to the plaintiff and, in addition,
may impose costs on the plaintiff.
(b) Except when express provision therefor
is otherwise made in a statute of the United
States, where the plaintiff who files the case
originally in the Federal courts is finally
adjudged to be entitled to recover less than
the sum or value of $75,000, computed
without regard to any setoff or
counterclaim to which the defendant may
be adjudged to be entitled, and exclusive of
interest and costs, the district court may
deny costs to the plaintiff and, in addition,
may impose costs on the plaintiff.
(4) a foreign state, defined in section 1603(a)
of this title, as plaintiff and citizens of a
State or of different States.
1332 (b)
23
New §
1332 (c)
Old Text
New Text
(c) For the purposes of this section and
section 1441 of this title—
(1) a corporation shall be deemed to be a
citizen of any State by which it has been
incorporated and of the State where it has
its principal place of business, except that in
any direct action against the insurer of a
policy or contract of liability insurance,
whether incorporated or unincorporated, to
which action the insured is not joined as a
party-defendant, such insurer shall be
deemed a citizen of the State of which the
insured is a citizen, as well as of any State
by which the insurer has been incorporated
and of the State where it has its principal
place of business; and
(2) the legal representative of the estate of a
decedent shall be deemed to be a citizen
only of the same State as the decedent, and
the legal representative of an infant or
incompetent shall be deemed to be a citizen
only of the same State as the infant or
incompetent.
(c) For the purposes of this section and
section 1441 of this title—
(1) a corporation shall be deemed to be a
citizen of every State and foreign state by
which it has been incorporated and of the
State or foreign state where it has its
principal place of business, except that in
any direct action against the insurer of a
policy or contract of liability insurance,
whether incorporated or unincorporated, to
which action the insured is not joined as a
party-defendant, such insurer shall be
deemed a citizen of—
(A) every State and foreign state of which
the insured is a citizen;
(B) every State and foreign state by which
the insurer has been incorporated; and
(C) the State or foreign state where the
insurer has its principal place of business;
and
(2) the legal representative of the estate of a
decedent shall be deemed to be a citizen
only of the same State as the decedent, and
the legal representative of an infant or
incompetent shall be deemed to be a citizen
only of the same State as the infant or
incompetent.
1332 (d)
[no changes]
[class actions and mass actions]
1332 (e)
(e) The word “States”, as used in this
section, includes the Territories, the District
of Columbia, and the Commonwealth of
Puerto Rico.
(e) The word “States”, as used in this
section, includes the Territories, the District
of Columbia, and the Commonwealth of
Puerto Rico.
1390 (a)
N/A
(a) Venue Defined.— As used in this
chapter, the term “venue” refers to the
geographic specification of the proper court
or courts for the litigation of a civil action
that is within the subject-matter jurisdiction
of the district courts in general, and does
not refer to any grant or restriction of
subject-matter jurisdiction providing for a
civil action to be adjudicated only by the
district court for a particular district or
districts.
24
New §
Old Text
New Text
1390 (b)
N/A
(b) Exclusion of Certain Cases.— Except as
otherwise provided by law, this chapter
shall not govern the venue of a civil action
in which the district court exercises the
jurisdiction conferred by section 1333
[Admiralty, M aritime and Prize], except
that such civil actions may be transferred
between district courts as provided in this
chapter.
1390 (c)
N/A
(c) Clarification Regarding Cases Removed
From State Courts.— This chapter shall not
determine the district court to which a civil
action pending in a State court may be
removed, but shall govern the transfer of an
action so removed as between districts and
divisions of the United States district courts.
1391(a)
(a) A civil action wherein jurisdiction is
founded only on diversity of citizenship
may, except as otherwise provided by law,
be brought only in (1) a judicial district
where any defendant resides, if all
defendants reside in the same State, (2) a
judicial district in which a substantial part
of the events or omissions giving rise to the
claim occurred, or a substantial part of
property that is the subject of the action is
situated, or (3) a judicial district in which
any defendant is subject to personal
jurisdiction at the time the action is
commenced, if there is no district in which
the action may otherwise be brought.
(a) Applicability of Section.— Except as
otherwise provided by law—
(1) this section shall govern the venue of all
civil actions brought in district courts of the
United States; and
(2) the proper venue for a civil action shall
be determined without regard to whether
the action is local or transitory in nature.
25
New §
Old Text
New Text
1391(b)
(b) A civil action wherein jurisdiction is not
founded solely on diversity of citizenship
may, except as otherwise provided by law,
be brought only in (1) a judicial district
where any defendant resides, if all
defendants reside in the same State, (2) a
judicial district in which a substantial part
of the events or omissions giving rise to the
claim occurred, or a substantial part of
property that is the subject of the action is
situated, or (3) a judicial district in which
any defendant may be found, if there is no
district in which the action may otherwise
be brought.
(b) Venue in General.— A civil action may
be brought in—
(1) a judicial district in which any defendant
resides, if all defendants are residents of
the State in which the district is located;
(2) a judicial district in which a substantial
part of the events or omissions giving rise
to the claim occurred, or a substantial part
of property that is the subject of the action
is situated; or
(3) if there is no district in which an action
may otherwise be brought as provided in
this section, any judicial district in which
any defendant is subject to the court’s
personal jurisdiction with respect to such
action.
1391(c)
(c) For purposes of venue under this
chapter, a defendant that is a corporation
shall be deemed to reside in any judicial
district in which it is subject to personal
jurisdiction at the time the action is
commenced. In a State which has more than
one judicial district and in which a
defendant that is a corporation is subject to
personal jurisdiction at the time an action is
commenced, such corporation shall be
deemed to reside in any district in that State
within which its contacts would be
sufficient to subject it to personal
jurisdiction if that district were a separate
State, and, if there is no such district, the
corporation shall be deemed to reside in the
district within which it has the most
significant contacts.
(c) Residency.— For all venue purposes—
(1) a natural person, including an alien
lawfully admitted for permanent residence
in the United States, shall be deemed to
reside in the judicial district in which that
person is dom iciled;
(2) an entity with the capacity to sue and
be sued in its common name under
applicable law, whether or not
incorporated, shall be deemed to reside, if
a defendant, in any judicial district in
which such defendant is subject to the
court’s personal jurisdiction with respect
to the civil action in question and, if a
plaintiff, only in the judicial district in
which it maintains its principal place of
business; and
(3) a defendant not resident in the United
States may be sued in any judicial district,
and the joinder of such a defendant shall be
disregarded in determining where the
action may be brought with respect to other
defendants.
26
New §
1391(d)
Old Text
New Text
(d) An alien may be sued in any district.
27
(d) Residency of Corporations in States
W ith M ultiple Districts.— For purposes of
venue under this chapter, in a State which
has more than one judicial district and in
which a defendant that is a corporation is
subject to personal jurisdiction at the time
an action is commenced, such corporation
shall be deemed to reside in any district in
that State within which its contacts would
be sufficient to subject it to personal
jurisdiction if that district were a separate
State, and, if there is no such district, the
corporation shall be deemed to reside in the
district within which it has the most
significant contacts.
[essentially unchanged from old 1391(c)]
New §
1391(e)
Old Text
New Text
(e) A civil action in which a defendant is an
officer or employee of the United States or
any agency thereof acting in his official
capacity or under color of legal authority,
or an agency of the United States, or the
United States, may, except as otherwise
provided by law, be brought in any judicial
district in which (1) a defendant in the
action resides, (2) a substantial part of the
events or omissions giving rise to the claim
occurred, or a substantial part of property
that is the subject of the action is situated,
or (3) the plaintiff resides if no real property
is involved in the action. Additional
persons may be joined as parties to any
such action in accordance with the Federal
Rules of Civil Procedure and with such
other venue requirements as would be
applicable if the United States or one of its
officers, employees, or agencies were not a
party.
(e) Actions W here Defendant Is Officer or
Employee of the United States.—
(1) In general.— A civil action in which a
defendant is an officer or employee of the
United States or any agency thereof acting
in his official capacity or under color of
legal authority, or an agency of the United
States, or the United States, may, except as
otherwise provided by law, be brought in
any judicial district in which
(A) a defendant in the action resides,
(B) a substantial part of the events or
omissions giving rise to the claim occurred,
or a substantial part of property that is the
subject of the action is situated, or
(C) the plaintiff resides if no real property is
involved in the action. Additional persons
may be joined as parties to any such action
in accordance with the Federal Rules of
Civil Procedure and with such other venue
requirements as would be applicable if the
United States or one of its officers,
employees, or agencies were not a party.
(2) Service.— The summons and complaint
in such an action shall be served as
provided by the Federal Rules of Civil
Procedure except that the delivery of the
summons and complaint to the officer or
agency as required by the rules may be
made by certified mail beyond the
territorial limits of the district in which the
action is brought.
The summons and complaint in such an
action shall be served as provided by the
Federal Rules of Civil Procedure except that
the delivery of the summons and complaint
to the officer or agency as required by the
rules may be made by certified mail beyond
the territorial limits of the district in which
the action is brought.
[NO CHANGES]
28
New §
Old Text
New Text
1391(f)
(f) A civil action against a foreign state as
defined in section 1603(a) of this title may
be brought—
(1) in any judicial district in which a
substantial part of the events or omissions
giving rise to the claim occurred, or a
substantial part of property that is the
subject of the action is situated;
(2) in any judicial district in which the
vessel or cargo of a foreign state is situated,
if the claim is asserted under section 1605(b)
of this title;
agency or instrumentality is licensed to do
business or is doing business, if the action is
brought against an agency or
instrumentality of a foreign state as defined
in section 1603(b) of this title; or
(4) in the United States District Court for
the District of Columbia if the action is
brought against a foreign state or political
subdivision thereof.
[NO CHANGES]
(f) Civil Actions Against a Foreign State.—
A civil action against a foreign state as
defined in section 1603 (a) of this title may
be brought—
(1) in any judicial district in which a
substantial part of the events or omissions
giving rise to the claim occurred, or a
substantial part of property that is the
subject of the action is situated;
vessel or cargo of a foreign state is situated,
if the claim is asserted under section 1605
(b) of this title;
agency or instrumentality is licensed to do
business or is doing business, if the action is
brought against an agency or
instrumentality of a foreign state as defined
in section 1603 (b) of this title; or
(4) in the United States District Court for
the District of Columbia if the action is
brought against a foreign state or political
subdivision thereof.
1391(g)
(g) A civil action in which jurisdiction of the
district court is based upon section 1369 of
this title may be brought in any district in
which any defendant resides or in which a
substantial part of the accident giving rise
to the action took place.
[NO CHANGES]
(g) M ultiparty, M ultiforum Litigation.— A
civil action in which jurisdiction of the
district court is based upon section 1369
[M ultiparty, multiforum jurisdiction] of this
title may be brought in any district in which
any defendant resides or in which a
substantial part of the accident giving rise
to the action took place.
1392
Any civil action, of a local nature, involving
property located in different districts in the
same State, may be brought in any of such
districts.
N/A [Repealed] (see new 1391(a)(2)).
29
New §
Old Text
New Text
1404(a)
(a) For the convenience of parties and
witnesses, in the interest of justice, a district
court may transfer any civil action to any
other district or division where it might
have been brought.
(a) For the convenience of parties and
witnesses, in the interest of justice, a district
court may transfer any civil action to any
other district or division where it might
have been brought or to any district or
division to which all parties have
consented.
1404(b)
(b) Upon motion, consent or stipulation of
all parties, any action, suit or proceeding of
a civil nature or any motion or hearing
thereof, may be transferred, in the
discretion of the court, from the division in
which pending to any other division in the
same district. Transfer of proceedings in
rem brought by or on behalf of the United
States may be transferred under this section
without the consent of the United States
where all other parties request transfer.
[NO CHANGES]
(b) Upon motion, consent or stipulation of
all parties, any action, suit or proceeding of
a civil nature or any motion or hearing
thereof, may be transferred, in the
discretion of the court, from the division in
which pending to any other division in the
same district. Transfer of proceedings in
rem brought by or on behalf of the United
States may be transferred under this section
without the consent of the United States
where all other parties request transfer.
1404(c)
(c) A district court may order any civil
action to be tried at any place within the
division in which it is pending.
[NO CHANGES]
(c) A district court may order any civil
action to be tried at any place within the
division in which it is pending.
1404(d)
(d) As used in this section, the term “district
court” includes the District Court of Guam,
the District Court for the Northern M ariana
Islands, and the District Court of the Virgin
Islands, and the term “district” includes the
territorial jurisdiction of each such court.
(d) Transfers from a district court of the
United States to the District Court of
Guam, the District Court for the Northern
M ariana Islands, or the District Court of
the Virgin Islands shall not be permitted
under this section. As otherwise used in
this section, the term “district court”
includes the District Court of Guam, the
District Court for the Northern M ariana
Islands, and the District Court of the Virgin
Islands, and the term “district” includes the
territorial jurisdiction of each such court.
30
New §
Old Text
New Text
1441(a)
§1441. Actions removable generally
(a) Except as otherwise expressly provided
by Act of Congress, any civil action brought
in a State court of which the district courts
of the United States have original
jurisdiction, may be removed by the
defendant or the defendants, to the district
court of the United States for the district
and division embracing the place where
such action is pending. For purposes of
removal under this chapter, the citizenship
of defendants sued under fictitious names
shall be disregarded.
(a) Generally.— Except as otherwise
expressly provided by Act of Congress, any
civil action brought in a State court of
which the district courts of the United
States have original jurisdiction, may be
removed by the defendant or the
defendants, to the district court of the
United States for the district and division
embracing the place where such action is
pending.
1441(b)
(b) Any civil action of which the district
courts have original jurisdiction founded on
a claim or right arising under the
Constitution, treaties or laws of the United
States shall be removable without regard to
the citizenship or residence of the parties.
Any other such action shall be removable
only if none of the parties in interest
properly joined and served as defendants is
a citizen of the State in which such action is
brought.
(b) Removal Based on Diversity of
Citizenship.—
(1) In determining whether a civil action is
removable on the basis of the jurisdiction
under section 1332 (a) of this title, the
citizenship of defendants sued under
fictitious names shall be disregarded.
(2) A civil action otherwise rem ovable
solely on the basis of the jurisdiction
under section 1332 (a) of this title may not
be rem oved if any of the parties in interest
properly joined and served as defendants
is a citizen of the State in which such
action is brought.
31
New §
Old Text
New Text
1441(c)
(c) W henever a separate and independent
claim or cause of action within the
jurisdiction conferred by section 1331 of this
title is joined with one or more otherwise
non-removable claims or causes of action,
the entire case may be removed and the
district court may determine all issues
therein, or, in its discretion, may remand all
matters in which State law predominates.
(c) Joinder of Federal Law Claims and State
Law Claims.—
(1) If a civil action includes—
(A) a claim arising under the Constitution,
laws, or treaties of the United States
(within the meaning of section 1331 of this
title), and
(B) a claim not within the original or
supplem ental jurisdiction of the district
court or a claim that has been made
nonremovable by statute,
the entire action may be removed if the
action would be removable without the
inclusion of the claim described in
subparagraph (B).
(2) Upon removal of an action described in
paragraph (1), the district court shall sever
from the action all claims described in
paragraph (1)(B) and shall remand the
severed claims to the State court from
which the action was rem oved. Only
defendants against whom a claim
described in paragraph (1)(A) has been
asserted are required to join in or consent
to the removal under paragraph (1).
1441(d)
(d) Any civil action brought in a State court
against a foreign state as defined in section
1603(a) of this title may be removed by the
foreign state to the district court of the
United States for the district and division
pending. Upon removal the action shall be
tried by the court without jury. Where
removal is based upon this subsection, the
time limitations of section 1446(b) of this
chapter may be enlarged at any time for
cause shown.
(d) Actions Against Foreign States.— Any
civil action brought in a State court against
a foreign state as defined in section 1603 (a)
of this title may be removed by the foreign
state to the district court of the United
States for the district and division
pending. Upon removal the action shall be
tried by the court without jury. Where
removal is based upon this subsection, the
time limitations of section 1446 (b) of this
chapter may be enlarged at any time for
cause shown.
32
New §
1441(e)
Old Text
New Text
(e)(1) Notwithstanding the provisions of subsection
(b) of this section, a defendant in a civil action in a
State court may remove the action to the district court
of the United States for the district and division
embracing the place where the action is pending if—
(e) Multiparty, Multiforum Jurisdiction.—
(1) Notwithstanding the provisions of subsection (b)
of this section, a defendant in a civil action in a State
court may remove the action to the district court of the
United States for the district and division embracing
the place where the action is pending if—
(A) the action could have been brought in a United
States district court under section 1369 of this title; or
(B) the defendant is a party to an action which is or
could have been brought, in whole or in part, under
section 1369 in a United States district court and arises
from the same accident as the action in State court,
even if the action to be removed could not have been
brought in a district court as an original matter.
The removal of an action under this subsection shall
be made in accordance with section 1446 of this title,
except that a notice of removal may also be filed
before trial of the action in State court within 30 days
after the date on which the defendant first becomes a
party to an action under section 1369 in a United
States district court that arises from the same accident
as the action in State court, or at a later time with
leave of the district court.
(2) Whenever an action is removed under this
subsection and the district court to which it is
removed or transferred under section 1407 (j) has
made a liability determination requiring further
proceedings as to damages, the district court shall
remand the action to the State court from which it had
been removed for the determination of damages,
unless the court finds that, for the convenience of
parties and witnesses and in the interest of justice, the
action should be retained for the determination of
damages.
(3) Any remand under paragraph (2) shall not be
effective until 60 days after the district court has
issued an order determining liability and has certified
its intention to remand the removed action for the
determination of damages. An appeal with respect to
the liability determination of the district court may be
taken during that 60-day period to the court of
appeals with appellate jurisdiction over the district
court. In the event a party files such an appeal, the
remand shall not be effective until the appeal has been
finally disposed of. Once the remand has become
effective, the liability determination shall not be
subject to further review by appeal or otherwise.
(4) Any decision under this subsection concerning
remand for the determination of damages shall not be
reviewable by appeal or otherwise.
(5) An action removed under this subsection shall be
deemed to be an action under section 1369 and an
action in which jurisdiction is based on section 1369 of
this title for purposes of this section and sections 1407,
1697, and 1785 of this title.
(6) Nothing in this subsection shall restrict the
authority of the district court to transfer or dismiss an
action on the ground of inconvenient forum.
(A) the action could have been brought in a United
States district court under section 1369 of this title; or
(B) the defendant is a party to an action which is or
could have been brought, in whole or in part, under
section 1369 in a United States district court and arises
from the same accident as the action in State court,
even if the action to be removed could not have been
brought in a district court as an original matter.
The removal of an action under this subsection shall
be made in accordance with section 1446 of this title,
except that a notice of removal may also be filed
before trial of the action in State court within 30 days
after the date on which the defendant first becomes a
party to an action under section 1369 in a United
States district court that arises from the same accident
as the action in State court, or at a later time with
leave of the district court.
(2) Whenever an action is removed under this
subsection and the district court to which it is
removed or transferred under section 1407(j) has made
a liability determination requiring further proceedings
as to damages, the district court shall remand the
action to the State court from which it had been
removed for the determination of damages, unless the
court finds that, for the convenience of parties and
witnesses and in the interest of justice, the action
should be retained for the determination of damages.
(3) Any remand under paragraph (2) shall not be
effective until 60 days after the district court has
issued an order determining liability and has certified
its intention to remand the removed action for the
determination of damages. An appeal with respect to
the liability determination of the district court may be
taken during that 60-day period to the court of
appeals with appellate jurisdiction over the district
court. In the event a party files such an appeal, the
remand shall not be effective until the appeal has been
finally disposed of. Once the remand has become
effective, the liability determination shall not be
subject to further review by appeal or otherwise.
(4) Any decision under this subsection concerning
remand for the determination of damages shall not be
reviewable by appeal or otherwise.
(5) An action removed under this subsection shall be
deemed to be an action under section 1369 and an
action in which jurisdiction is based on section 1369 of
this title for purposes of this section and sections 1407,
33
New §
Old Text
New Text
1441(f)
(f) The court to which a civil action is
removed under this section is not precluded
from hearing and determining any claim in
such civil action because the State court
from which such civil action is removed did
not have jurisdiction over that claim.
(f) Derivative Removal Jurisdiction.— The
court to which a civil action is removed
under this section is not precluded from
hearing and determining any claim in such
civil action because the State court from
which such civil action is removed did not
have jurisdiction over that claim.
l446(a)
(a) A defendant or defendants desiring to
remove any civil action or criminal
prosecution from a State court shall file in
the district court of the United States for the
district and division within which such
action is pending a notice of removal signed
pursuant to Rule 11 of the Federal Rules of
Civil Procedure and containing a short and
plain statement of the grounds for removal,
together with a copy of all process,
pleadings, and orders served upon such
defendant or defendants in such action.
(a) Generally.— A defendant or defendants
desiring to remove any civil action from a
State court shall file in the district court of
the United States for the district and
division within which such action is
pending a notice of removal signed
pursuant to Rule 11 of the Federal Rules of
Civil Procedure and containing a short and
plain statement of the grounds for removal,
together with a copy of all process,
pleadings, and orders served upon such
defendant or defendants in such action.
34
New §
l446(b)
Old Text
New Text
(b) The notice of removal of a civil action or
proceeding shall be filed within thirty days
after the receipt by the defendant, through
service or otherwise, of a copy of the initial
pleading setting forth the claim for relief
upon which such action or proceeding is
based, or within thirty days after the service
of sum mons upon the defendant if such
initial pleading has then been filed in court
and is not required to be served on the
defendant, whichever period is shorter.
(b) Requirements; Generally.—
(1) The notice of removal of a civil action or
proceeding shall be filed within 30 days
after the receipt by the defendant, through
service or otherwise, of a copy of the initial
pleading setting forth the claim for relief
upon which such action or proceeding is
based, or within 30 days after the service of
summons upon the defendant if such initial
pleading has then been filed in court and is
not required to be served on the defendant,
whichever period is shorter.
(2)
(A) When a civil action is removed solely
under section 1441 (a), all defendants who
have been properly joined and served
must join in or consent to the removal of
the action.
(B) Each defendant shall have 30 days
after receipt by or service on that
defendant of the initial pleading or
summons described in paragraph (1) to
file the notice of removal.
(C) If defendants are served at different
times, and a later-served defendant files a
notice of removal, any earlier-served
defendant may consent to the removal
even though that earlier-served defendant
did not previously initiate or consent to
rem oval.
(3) Except as provided in subsection (c), if
the case stated by the initial pleading is
not removable, a notice of removal may be
filed within thirty days after receipt by
the defendant, through service or
otherwise, of a copy of an am ended
pleading, motion, order or other paper
from which it may first be ascertained that
the case is one which is or has becom e
removable.
If the case stated by the initial pleading is
not removable, a notice of removal may be
filed within thirty days after receipt by the
defendant, through service or otherwise, of
a copy of an amended pleading, motion,
order or other paper from which it may first
be ascertained that the case is one which is
or has becom e rem ovable, except that a case
may not be removed on the basis of
jurisdiction conferred by section 1332 of this
title more than 1 year after commencement
of the action.
35
New §
l446(c)
Old Text
New Text
(c)(1) A notice of removal of a criminal
prosecution shall be filed not later than
thirty days after the arraignment in the
State court, or at any time before trial,
whichever is earlier, except that for good
cause shown the United States district court
may enter an order granting the defendant
or defendants leave to file the notice at a
later time.
(c) Requirements; Removal Based on
Diversity of Citizenship.—
(1) A case may not be removed under
subsection (b)(3) on the basis of
jurisdiction conferred by section 1332
more than 1 year after commencement of
the action, unless the district court finds
that the plaintiff has acted in bad faith in
order to prevent a defendant from
removing the action.
(2) If removal of a civil action is sought on
the basis of the jurisdiction conferred by
section 1332 (a), the sum demanded in
good faith in the initial pleading shall be
deem ed to be the am ount in controversy,
except that—
(A) the notice of removal may assert the
amount in controversy if the initial
pleading seeks—
(i) nonmonetary relief; or
(ii) a m oney judgm ent, but the State
practice either does not permit dem and for
a specific sum or permits recovery of
damages in excess of the amount
demanded; and
(B) removal of the action is proper on the
basis of an am ount in controversy asserted
under subparagraph (A) if the district
court finds, by the preponderance of the
evidence, that the am ount in controversy
exceeds the am ount specified in section
1332 (a).
(3)
(A) If the case stated by the initial
pleading is not rem ovable solely because
the am ount in controversy does not exceed
the am ount specified in section 1332 (a),
information relating to the am ount in
controversy in the record of the State
proceeding, or in responses to discovery,
shall be treated as an “other paper” under
subsection (b)(3).
(B) If the notice of removal is filed more
than 1 year after commencement of the
action and the district court finds that the
plaintiff deliberately failed to disclose the
actual amount in controversy to prevent
removal, that finding shall be deemed bad
faith under paragraph (1).
(2) A notice of removal of a criminal
prosecution shall include all grounds for
such removal. A failure to state grounds
which exist at the time of the filing of the
notice shall constitute a waiver of such
grounds, and a second notice may be filed
only on grounds not existing at the time of
the original notice. For good cause shown,
the United States district court may grant
relief from the limitations of this paragraph.
(3) The filing of a notice of removal of a
criminal prosecution shall not prevent the
State court in which such prosecution is
pending from proceeding further, except
that a judgment of conviction shall not be
entered unless the prosecution is first
remanded.
(4) The United States district court in which
such notice is filed shall examine the notice
promptly. If it clearly appears on the face of
the notice and any exhibits annexed thereto
that removal should not be permitted, the
court shall make an order for summary
remand.
(5) If the United States district court does
not order the summary remand of such
prosecution, it shall order an evidentiary
hearing to be held promptly and after such
hearing shall make such disposition of the
prosecution as justice shall require. If the
United States district court determines that
removal shall be permitted, it shall so notify
the State court in which prosecution is
pending, which shall proceed no further.
36
New §
Old Text
New Text
l446(d)
(d) Promptly after the filing of such notice
of removal of a civil action the defendant or
defendants shall give written notice thereof
to all adverse parties and shall file a copy of
the notice with the clerk of such State court,
which shall effect the removal and the State
court shall proceed no further unless and
until the case is remanded.
(d) Notice to Adverse Parties and State
Court.— Promptly after the filing of such
notice of removal of a civil action the
defendant or defendants shall give written
notice thereof to all adverse parties and
shall file a copy of the notice with the clerk
of such State court, which shall effect the
removal and the State court shall proceed
no further unless and until the case is
remanded.
l446(e)
(e) If the defendant or defendants are in
actual custody on process issued by the
State court, the district court shall issue its
writ of habeas corpus, and the marshal shall
thereupon take such defendant or
defendants into his custody and deliver a
copy of the writ to the clerk of such State
court.
(e) Counterclaim in 337 Proceeding.— W ith
respect to any counterclaim removed to a
district court pursuant to section 337(c) of
the Tariff Act of 1930, the district court shall
resolve such counterclaim in the same
manner as an original complaint under the
Federal Rules of Civil Procedure, except
that the payment of a filing fee shall not be
required in such cases and the counterclaim
shall relate back to the date of the original
complaint in the proceeding before the
International Trade Commission under
section 337 of that Act.
l446(g)
[sic there is
no subsection
(f)]
(f) W ith respect to any counterclaim
removed to a district court pursuant to
section 337(c) of the Tariff Act of 1930, the
district court shall resolve such
counterclaim in the same manner as an
original complaint under the Federal Rules
of Civil Procedure, except that the payment
of a filing fee shall not be required in such
cases and the counterclaim shall relate back
to the date of the original complaint in the
proceeding before the International Trade
Commission under section 337 of that Act.
(g) W here the civil action or criminal
prosecution that is removable under section
1442 (a) is a proceeding in which a judicial
order for testimony or documents is sought
or issued or sought to be enforced, the
30-day requirement of subsection (b) of this
section and paragraph (1) of section 1455
(b) is satisfied if the person or entity
desiring to remove the proceeding files the
notice of removal not later than 30 days
after receiving, through service, notice of
any such proceeding.
37
Slide 1
___________________________________
___________________________________
Technology in the Court Room
IDC and TADC Winter Seminar
Steamboat Springs, Colorado, February 7-9, 2013
___________________________________
Timothy A. Weaver
Pretzel & Stouffer, Chartered
___________________________________
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Slide 2
Scanned record with blemishes
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Slide 3
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Whiteout applied to remove blemishes
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Slide 4
Text added with Markups
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Slide 5
Medical Record Annotated 1
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Slide 6
Let’s add text.
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Slide 7
Transcription added 1
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Slide 8
Transcription Added 2
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Slide 9
Doctor’s office progress note
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Slide 10
Progress note transcribed
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Slide 11
Detail identified with blue arrow
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Slide 12
Same detail with Zoom In
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Slide 13
Medical illustration in pdf format
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Slide 14
Illustration with arrows added
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Slide 15
Arrows added to hospital note
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Slide 16
Deposition exhibit in need of touch ups
and enhancements
___________________________________
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Slide 17
Deposition exhibit after modification with
Markups
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___________________________________
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Slide 18
Cascade function for organization
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Slide 19
View All to navigate inside document
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Slide 20
View all with Zoom in
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Slide 21
Two files open on one screen
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Slide 22
Pasting pages from one file to another
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Slide 23
Pasted image with no border
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Slide 24
Pages from conference summary 1
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Slide 25
Pages from conference summary 2
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Slide 26
Page from conference summary 3
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Slide 27
Report to company
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1
Illinois Association of Defense Trial Counsel
Texas Association of Defense Counsel
WINTER SEMINAR February 2013
Steamboat Springs, Colorado
Technology in the Court Room
Timothy A. Weaver
Author and Speaker
One South Wacker Drive
Suite 2500
Chicago, IL 60606
312.578.7416
February 8, 2013
2
Table of Contents
I.
II.
III.
IV.
V.
VI.
VII.
Introduction
The Basics: Tabs, Ribbons, and Buttons
Adding Content with Markups
Stamps
File Management and Exhibit Coordination
Uses of eCopy PaperWorks™ in Office Practice
Document Transfers between PC and iPad™
3
4
6
37
48
55
60
A.
60
66
68
72
72
B.
C.
D.
E.
VIII.
IX.
Export pdf files to iPad™ from PC via iTunes™
Export pdf file to iPad™ from PC via DropBox™
Export Word™ files to iPad™ via iTunes™
Export Word™ files to iPad via Dropbox™
Export Pages™ files to PC from iPad™
Internet Document Storage and Transfer
Conclusion
75
82
3
I.
Introduction
Personal computers permit us to create effective and inexpensive
exhibits for jury trials. This paper will show how one can use eCopy
PaperWorks™ to manage documents in the office and in court and how
to create inexpensive but effective demonstrative evidence.
eCopy PaperWorks™ is a powerful computer program that allows
you to add electronic overlays which add information, conceal
information, highlight aspects, and direct the viewer’s attention. These
tools allow medical records to be turned into exhibits which capture
the attention of the jury and enable them to understand the
documents. One can place large headings on the documents, list them
as thumbnails, and find them quickly in court for use during
examinations of witnesses and statements to the jury. Handwritten
material can be transcribed on the original document so the jury can
read both transcription and original hand writing at the same time.
Confidential material and irrelevancies can be redacted. Expensive
medical illustrations can be shown to the jury electronically with the
attorney having the ability to draw red arrows or make other marks in
front of the jury without spoiling the original, poster board exhibits.
Portions of documents can be enlarged for easier viewing by the jury.
Exhibits can be emailed other counsel and witnesses.
The best way to understand the versatility of this program is to
see it in action. The remainder of this paper will set forth examples of
what can be done. I will use Italics and capitalization for the action
words you will find in the tool bars and ribbons of the programs
discussed. Cross referencing will be by Figure number and associated
text. An index is included in the back.
4
II.
The Basics: Tabs, Ribbons, and Buttons
Figure 1.1: eCopy™ screen
Figure 1.1 shows the initial screen when the program is open. A
brief introduction to this screen and its tabs, ribbons, and buttons may
be helpful.
As shown in Figure 1.1, below the Title bar “eCopy PaperWorks™
[title of opened document]” are Command Tabs common to all
Windows® programs and others specific to eCopy PaperWorks™. The
following Command Tabs are displayed: File, Edit, Scan, Scan Inbox,
View, Document, Markups, Options, Window, and Help. We open
documents, save them, and print them from the File tab. The Edit file
5
lets us undo, redo, copy, cut, paste, and delete a page. The Document
tab lets us add a blank page, which will permit us to insert dividers (e.g.,
“Operative Reports,” “Progress Notes”). Markups is the tab for adding
and removing content from the documents. We will spend a
considerable amount of time exploring the functions of Markups.
Finally, Window will let us show multiple eCopy documents in a shingle
fashion for easy switching from one to another.
Immediately below the Command Tabs is a ribbon, which contains
a series of buttons: Open, Save, Print, Search, Previous, Next, Zoom in,
Zoom Out, Text, View All, Fit Width, Rotate Left, Rotate Right, and
Markups. Open, Save, Print have obvious functions common to all
Windows programs. Previous and Next permit paging through the
document one page at a time. Zoom In and Zoom Out have obvious
functions.
View All is an important button because it lets us show the
document as a series of thumbnails, small enough that one can see 21
or more per screen and large enough to determine by formatting or
appearance the type of document it is. Not only can one distinguish
between typed reports and hand written notes but also one can add in
large font headings and page numbers or exhibit numbers that can be
read in thumbnail mode. This will be demonstrated later at Figure 1.44
and the accompanying text.
Many documents contain pages which are printed in landscape
orientation. The Rotate Left and Rotate Right buttons allow one to turn
these landscape-oriented pages for easy viewing. Thus the document
seen in View All mode will show portrait-oriented pages and landscape
pages together with each page having the correct orientation. See
Figure 1.49 and accompanying text.
6
III.
Adding Content with Markups
Figure 1.2: Markups Ribbon
Figure 1.2 shows the screen when Markups is open with a
witness’s curriculum vitae as the document to be addressed. Click the
button Markups to access tools for turning records into demonstrative
exhibits. The third and fourth ribbons contain the many functions of
Markups. The Text tab permits the addition of content to the original
page as a removable overlay. One can add large headings, exhibit
numbers, and transcriptions. The Line button allows us to draw colored
arrows to identify important material. The Highlight button gives us a
paint brush to highlight content. Redactions can be performed with
either Blackout or Whiteout.
7
These functions allow us to place electronic, removable overlays
without altering the document because they can be easily removed in
stages or altogether. The Pick button permits such removal. See Figure
1.10 and accompanying text.
Figure 1.3: Text added per Markups, Text
Figure 1.3 shows a pdf with the addition of a red font heading and
a purple page number in lower right corner.
8
Figure 1.4: Document header added with Markups, Text
Figure 1.4 shows how I identify a document. The heading is large
enough to read by everyone in the court room and by the attorneys in
View All. See Figure 1.44 and accompanying text.
9
Figure 1.5: Line with arrow added by Markups, Line
Markups lets one add lines to draw attention to aspects of the
document. This can be drawn while the jury is watching. The line end
and beginning can have arrow or plain tips. See Markups, Line, Starting
and Ending. The width of the arrow can be varied with the Width
button. Transparent can lighten the line as much as desired.
The yellow highlights were added by clicking Highlight, selecting a
color, and using the cursor to block the material to be highlighted.
10
Figure 1.6: Typical pdf image of scanned record
Choose Whiteout from Markups to remove blemishes, hole-punch
marks, or to make redactions. Compare Figure 1.6 with Figure 1.7. The
first has multiple black circles where holes were punched and a black
border around the original edge of the report. It is an ugly base
document from which to make an exhibit.
11
Figure 1.7: Image of scanned document with blemishes removed by
Whiteout
Figure 1.7 shows the results of using Whiteout to remove the
black holes and paper edges. You can now place a large document title
in color font at the top and an exhibit number at the bottom to make
an attractive exhibit for the jury.
12
Figure 1.8: Heading added after blemishes removed
Figure 1.8 shows the document from Figure 1.6 with Whiteouts
having been used to remove the blemishes and a red heading added for
identification. It looks much better than an enlargement of the original
and yet is authentic in content and format.
Practice Tip: I send other counsel by email the pdf files I plan to use
and have never received an objection to the overlays discussed herein.
13
Figure 1.9: Exhibit showing heading and exhibit number
Figure 1.9 shows the same document but small enough to see the
exhibit number, also placed by using Markups, Text. Headings and
exhibit markings can be standardized and collected as Stamps in
eCopy™. See Figure 1.32 et seq. and accompanying text.
14
Figure 1.10: Removal or alteration of Markups with Pick button
You can use the Pick button to remove Markups if you change
your mind. Here, I clicked Markups, Pick, and then the markup I wanted
to change, which was the heading. I can now move the overlay by
dragging it, change the font type and size by using the font and size
boxes in the banner, or delete it by clicking delete on my keyboard.
I used Blackout to redact the patient’s name for publication of the
exhibit in this paper. At trial I showed the name of the plaintiff. See
Figures 1.13-1.15 and accompanying text.
15
Figure 1.11: Heading font changed with Pick button
Figure 1.11 results from selecting a different font, size, and color
for the blocked Markups shown in Figure 1.10.
16
Figure 1.12: Highlighting to be moved/removed with Pick button
Figure 1.12 shows that highlighting can be blocked and removed
(or even moved) with Markups, Pick.
Practice Tip: One can correct errors made in the annotated pdf files by
use of the Pick button. This is especially useful in changing text and
arrows, which often need modification.
17
Figure 1.13: Arrow identifies information to be redacted
Redaction: We can redact the reference to Medicare, identified by
the blue arrow in Figure 1.13. I can do it with Blackout so everyone
knows that something was blacked out or I can use Whiteout for a more
subtle removal of content. [I have already used Whiteout for identifying
information for purposes of publication of this text. The jury saw all the
identifying information.]
18
Figure 1.14: Blackout content
This is how Blackout appears.
19
Figure 1.15: Whiteout content
This is the same redaction, albeit with Whiteout.
Practice Tip: Blackout creates an obvious redaction. You might want to
use Blackout to remove the names of patients other than the plaintiff
from a surgical log so the jury knows that you are protecting the
identities of these other people and that those people did indeed have
their names on the document. You might want to use the more subtle
Whiteout to remove references to insurance, smoking, and irrelevant
health histories.
20
Figure 1.16: Text button to add transcription of handwritten content
Figure 1.16 shows a transcription of handwritten material as an
overlay to the original document. I did this by selecting Markups, Text,
and choosing the font type, size, and color before placing the cursor at
the location where I planned to type the transcription. (I have used
Blackout to remove the patient’s name from this paper.)
21
Figure 1.17: Text used to add transcription
Practice Tip: Sometimes the transcription creates a dense exhibit, as
seen in Figure 1.17, but it is still an improvement over the handwritten
document enlarged and placed on an expensive poster board. The jury
can read the transcriptions while seeing the nearly illegible hand
written original, which gives credibility to the transcription.
22
Figure 1.18: Text for adding content
Figure 1.18 shows another example of adding content (Text for
adding transcription) and removing content (Blackout of patient’s
name). The exhibit is not dense like Figure 1.17 because this one has
enough blank space for the overlay.
Practice Tip: You can use Whiteout to hide some of the original content
and thereby create a blank space for adding your own content. This can
precipitate objections unless agreement can be reached beforehand.
Figures 1.19-1.20 and accompanying text show a better way to convey
a large amount of content in transcribed format.
23
Figure 1.19: Hand written document to be transcribed
Figure 1.19 shows a doctor’s handwritten office progress note.
While it is fairly legible, it does not show well in court because of the
distance between the screen and the jury box. A better way to present
this evidence is to create a transcription of the page. Take the following
steps.
One can scan the original office records as a pdf file, make them a
group exhibit [“Ex 6.1, 6.2,” etc.], and then create a separate group
24
exhibit which has the first exhibit transcribed line for line and column
for column like the original.
There are two ways to create the transcribed exhibit. With the
document in View All, one can click the Document tab and the Add
Blank Page and then use Markups and Text to type the content desired.
This approach works well if the amount of material is limited.
Figure 1.20: Typing text on blank page with Markups, Text
A second method is to use a word processor to transcribe the
original and then convert it to pdf format by “printing” it from a word
processor, using the eCopy™ printer rather than one of the traditional
printers. Microsoft™ Word 2007 will then open eCopy PaperWorks™
and have on the screen the converted document. It is then ready to be
25
saved as whatever name you choose. If eCopy PaperWorks™ is already
open and there are no open pdf documents on the screen, Word 2007™
will place the converted file on the screen. If eCopy PaperWorks™ is
open and there is a document on the screen, eCopy PaperWorks™ will
ask you to decide whether to append the converted document to the
end of the current pdf document or at the beginning of that document
or if you want to create a new document. Just make your choice in the
dialogue box that pops up.
Figure 1.21: Screen from Word 2007™ showing print function with
eCopy PaperWorks™ Printer selected
26
Figure 1.22: Screen in eCopy™ asking for instructions for
word processing document printed in eCopy™
Practice Tip: Short transcriptions can be done easily with the
Documents, Add Blank Page, Markups, Text approach. Longer
documents, however, should be done in word processing because there
are more functions in word processing to facilitate a closer match
between original and transcription and because the word processor is
more efficient.
27
Figure 1.23: Word 2007™ transcription of handwritten document seen
in Figure 1.19
Figure 1.23 shows the transcription I made of the original progress
note seen in Figure 1.19. I used Word 2007™, making each line read
exactly as the original irrespective of the spacing that resulted, and
using columns to mimic the placement of information on the original.
Practice Tip: Once I establish the authenticity of Figure 1.23 by having
the doctor compare it to Figure 1.19, I rarely use the original in court.
The transcribed version looks more professional and is so easy to read
that I see no need to use the original thereafter. Even in opening
statement I show both versions to the jury, describe how I will later
establish authenticity, and rely on the transcribed exhibit for the
remainder of the opening statement. I do not receive objections by
opposing counsel because they have reviewed these exhibits before
trial.
28
Figure 1.24: Arrow added by Markups, Line
If we want to draw attention to a certain aspect of the original,
we can use an arrow [Markups, Line, and cursor for drawing the line] as
seen in Figures 1.5 and 1.24 and discussed in the text associated with
Figure 1.5. We can add text in large, red font, as shown in Figure 1.16
and as discussed in the text associated with that figure. We can add
highlighting [Markups, Highlight as seen in Figures 1.5 and 1.24 and as
discussed in the text associated with Figure 1.5.
There are, however, other ways to draw attention to content. We
might want to have the jury view a close up of an original entry, e.g.,
the blood pressure reading seen at the end of the arrow in Figure 1.24.
To do this, close Markups use the cursor to draw a box around the
blood pressure reading, and release the left mouse key, bringing up a
dialogue box. Click Zoom In to show the enlarged BP. The size can be
changed by clicking repeatedly the Zoom In and/or the Zoom Out
29
buttons in the ribbon or by changing the percentage number in the box
between the two zoom buttons.
Figure 1.25: Zoom In
Figure 1.25 shows the blood pressure numbers at the end of the
blue arrow in Figure 1.24 but shows them 658% larger than in the
original. The initial enlargement was 861% the size of the original. I
thought some clarity was lost so I zoomed out to 658%, not by choosing
that a specific number but clicking Zoom Out until I was satisfied with
the result.
Practice Tip: Someone assisting the trial attorney can on request do
this in front of the jury. It captures the attention of the jury and helps
to make your ideas and bases of opinions clear.
30
Markups can be used on any document that can be converted to
pdf format. Color photocopies of anatomy books, hand drawn exhibits
from depositions, and illustrations made specifically for trial can all be
shown to the jury via eCopy PaperWorks™. Furthermore, they can be
marked up in front of the jury during opening statement, closing
argument, and even cross examination. The Pick button allows the
removal of any saved markups, but one does not even have to save the
markups. See Figure 1.10 et seq. and accompanying text.
For example, I used arrows during cross examination of an
adverse expert but did not save the changes to the pdf file. Thus I did
not alter my original pdf file or even preserve it. Observers said the jury
was captivated by the exhibit and what I was drawing on it during cross
examination. See Figures 1.27-1.28 and accompanying discussion.
Figure 1.26: Medical illustration saved in pdf
31
Figure 1.26 is a pdf of a medical illustration made for my recent
trial involving vascular surgery to the lower extremity. The drawing on
the left side shows the short bypass [schematically drawn as a green
tube] made by the defendant during his first effort to restore blood
flow to the foot. This effort failed. During the same operation, he
extended the bypass, as shown in the drawing on the right.
During cross examination there was much dispute in very
technical terms about the target of the second bypass. I drew a series
of arrows during the cross examination so the jury could follow my
ideas. Observers said the jury paid very close attention.
Figure 1.27: Arrows added to illustration with Markups, Line; arrows
can be saved or discarded.
32
The red arrows in Figure 1.27 are similar to what I drew during
cross examination. The jury had heard all the terms before but the
arrows helped them understand the anatomy during the examination.
I took the same approach during cross examination as to my
client’s post-operative note, which note contained some unfortunate
errors. I showed how taken as a whole, the note did indeed support my
view as to what had been done, incongruent language and errors to the
contrary notwithstanding. See Figure 1.28.
Figure 1.28: Arrows used during cross examination
In Figure 1.28 I drew arrows to the words “resection of …
posterior tibial trunk” and “Popliteal saphenous vein bypass to
posterior tibial trunk” while cross examining the adverse expert. He
maintained that my client had in the second effort merely bypassed to
a target a few cm lower on the “trunk,” a short artery, whereas my
33
client maintained that he had targeted a much more distal artery. Since
the lower arrow points to my client having resected (cut out) the trunk,
he could not have used that as his final target even though upper
arrowed reference seemed to contradict that assertion. I then showed
other exhibits in which non-party physicians provided notes supportive
of my position.
Figure 1.29: Deposition exhibit in need of redaction of content
Figures 1.29 and 1.30 show how I used Whiteout to remove my
client’s first attempt at deposition to draw a schematic of his bypass
surgery so I could make an exhibit of the final drawing, located
immediately to the right of the first effort [Figure 1.29]. Figure 1.30
shows the same drawing seen on the right side of Figure 1.29 with
34
enhancements identifying the structures and yellow highlighting the
bypass itself but without the first drawing to clutter up the exhibit.
Figure 1.30: Deposition exhibit with Whiteout redaction and Markups,
Text, Line, and Highlight
Figure 1.30 is what I showed the jury. It has the first drawing with
blemishes removed by Whiteout and enhancements made with
Markups, Text, Highlight, and Line.
35
If you want to send documents with no editorial rights to change
your Markups (for example, to opposing counsel), you can do this by
making the Markups permanent. A second reason for making them
permanent is that you will be able to view the Markups in your iPad
only if the Markups are permanent. See Figure 1.64 and the
accompanying text. Since you are likely to need continuing editorial
rights for yourself as discovery and even trial progress, I suggest a
naming scheme that will permit easy organization of the different
permutations of the document. If the names are long, you might not
see the ends of the names in iTunes™ when preparing to transfer the
files to iPad™. See Figures 1.58 et seq. and accompanying text. You
might use a scheme similar to the following:
NAME OF DOCUMENT
LoyolaDec03.pfd
TYPE OF DOCUMENT
Original with no Markups
LoyolaDec03 Anno.pdf
Markups can be edited
LoyolaDec 03 perm.pdf
Markups are permanent
36
Figure 1.31: Save As screen with Make Markups Permanent drop
down menu and All selected
You can make your markups permanent when you do a Save As. In
Figure 1.31 you see the Make Markups Permanent drop down menu at
the bottom of the screen. The choices are None, Blackout/Whiteout,
and All. I have selected All to preserve all of them.
37
IV.
Stamps
eCopy™ allows you to create Stamps for commonly inserted
words. While it is not difficult to quickly type headings, page numbers,
and exhibit designations, using the Stamps feature will promote
consistency in style as to these insertions. You can create specific
Libraries for specific types of stamps.
To begin, click Markups, then Stamp from the eCopy™ ribbon. You
will see a screen similar to that in Figure 1.32.
Figure 1.32: eCopy Markups, Stamps
Click Select Library to choose a different library. You will see a screen
like that in Figure 1.33. Your most recently used library will be the
default when you open Stamps.
38
Figure 1.33: Select a library from list; click OK.
39
Figure 1.34: Stamp “Progress Notes” clicked and dragged from column
on left in Medical Records Library, and placed on top of pdf file
Place cursor on the desired stamp and drag it to the document
where you want to insert it. When you release the left mouse, there
will be a box around the stamp permitting you to move it again. See
Figure 1.34.
To add stamps to the library use Markups to create the stamp,
close Markups, use the cursor to block the desired image, and release
the left mouse. You will see a pop up window to the right of the block.
Click Create Stamp. Figure 1.35 shows an exhibit label as the image for
the new stamp.
40
Figure 1.35: Markups used to create exhibit designation.
Once Create Stamp is selected, you will see the screen shown in Figure
1.36. The new image appears in the Stamp box in the upper right
corner of the screen.
41
Figure 1.36: New stamp image in Stamp box.
To add the image in the box to the stamp library shown, click Add.
Figure 1.37: New stamp shown in both Add box and Library
42
Figure 1.38: Exhibit label now shown in library column on left side of
screen
You can create new stamp libraries. In Figure 1.38 under “Stamps”
and above the column of stamps in the Medical Records stamp Library,
click Manage Library. You will be taken to the screen shown in Figure
1.39. Stamps can be copied from one library to another. You can create
a stamp in an old library and use Manage Library to switch it over to a
new library and then give that new library a name. See Figures 1.39 –
1.42.
43
Figure 1.39: Manage Library, exhibit stamp copied from existing
library on left side of screen to new stamp library on right side.
After putting at least one new stamp in the right column (“Library,
Untitled”), click the far right icon above new stamp library. You will see
the screen in Figure 1.40. Click Yes.
44
Figure 1.40: New Library button selected for untitled library shown in
Figure 1.39
Click Yes in Figure 1.40 and you will see the Save As screen shown
in Figure 1.41. There you can type a name for the new stamp library.
The suffix must be “.glb.”
45
Figure 1.41: Save As screen for Stamps
Figure 1.41 shows the screen for naming the new stamp library.
46
Figure 1.42: NewStampLibrary.glb chosen as name of new stamp
library
After typing the new library name, click Save. You can verify that
you have created a new stamp library by clicking Select Library from the
screen shown in 1.38. See Figure 1.43 to see NewStampLibrary.glb in
the list of libraries.
47
Figure 1.43: Select Library showing NewStampLibrary on list of
available libraries.
48
V. File Management and Exhibit Coordination with eCopy
PaperWorks™
So, you have made all these exhibits, but you fear that you will
not be able to manage them in the court room. The best method of
management comes from the careful use of Window, Cascade to find
the desired files and View All to see what you have created.
Figure 1.44: Documents seen in Window, Cascade
Figure 1.44 shows the result of clicking the Window tab and then
Cascade. You can place the cursor on the title banners of these files to
move them around the screen, and you can change their sizes by
working on the borders of the sub-screens.
49
Figure 1.45: Documents seen as thumbnails in View All
Click View All to see thumbnails of the documents, as
demonstrated in Figure 1.45. Large font headings can be read on
thumbnails even if text cannot be. Large exhibit numbers or page
numbers added to the bottoms of the pages can be read in View All
mode. Click any given page to enlarge it for viewing.
If you want larger but fewer thumbnails, use click the Zoom In
button or enter a number in the % box in the ribbon (right below the
tool bar with Tabs. See Figure 1.46.
50
Figure 1.46: Thumbnails in View All after Zoom In
Figure 1.46 shows View All with larger thumbnails This was
achieved by clicking the Zoom In tab several times. One can see the
inserted dividers made from by selecting Document, Add Blank Page,
Markups, Text, and then adding content. See Figure 1.20 and associated
text.
Dividers made in word processing can be added by “printing”
them into eCopy PaperWorks™. See Figures 1.20, 1.21, 1.22 and
associated text.
51
Figure 1.47: Two files seen in View All with split screen
Figure 1.47 shows two files initially viewed in Window, Cascade
[see Figure 1.44] but then modified by changing the sizes of the subscreens to permit work on two files at the same time.
Click the title bar of each file to move them to view both sets of
thumbnails at the same time. Use cursor to modify the dimensions of
the “screens” showing the two files. Click the pages from the sending
document you want to copy to the receiving document and drag them
to the place in the receiving document desired.
Pages can be copied from one file to another by opening both
receiving file and sending file and dragging the desired pages. Open the
two files. Use Window, Cascade to view the two files in shingle array.
Then modify the windows as discussed in the text associated with
52
Figure 1.47 and as shown in Figures 1.47 and 1.48. Use View all from
the ribbon for each document so you can see the thumbnails.
Figure 1.48: Two files seen in View All with split screen, ready for
export
This shows two files in View All with the screens altered to permit
viewing of thumbnails in each. Note that the fetal monitor strip pages
are shown in landscape orientation while the medical records are
shown in portrait. A given file can accommodate pages in both
orientations. See Figure 1.49.
Clicking on any page in either document will enlarge it for more
careful viewing. Once you have determined what pages are to be
copied, click them and drag to the receiving document. Here I will drag
53
several pages of the fetal monitor strip and place them between two
pages of the hospital chart.
Figure 1.49: Pages copied from bottom file to top file
In Figure 1.49 I have copied the first two pages of the fetal
monitor strip from the file in the lower window and dragged them to
become pages 15 and 16 of the file shown in the upper window. Note
that the file in the upper window has both portrait and landscape.
Practice Tip: This process can be used to create from your many
exhibits special sets for opening statements, closing arguments, and
examination of witnesses. For example, you might select the operative
report, one CT scan report, two progress notes, and the discharge
summary to cross examine a former surgical resident called to the
witness stand by the plaintiff. Those documents can be collected before
54
trial; and the attorney can add documents to the “witness folder” by
this process, even as late as during the direct examination of that very
witness.
Practice Tip: It is especially convenient to create files for opening
statement and closing argument. You can collect a dozen or more key
documents from many hundreds of pdf pages already marked as
exhibits and direct someone to show those on projector to the jury
during summation.
55
VI.
Uses of eCopy PaperWorks™ Technology in Office Practice
This technology is not limited to use in court and preparation for
court. You can use these programs to improve communication with
other counsel and with clients. You can send anatomic drawings or
deposition exhibits with your own markings to clients who are already
receiving your deposition summaries. You can send a word processing
document for the summary and a pdf of the exhibits or drawings.
One can “print” the word processing document into eCopy
PaperWorks™ (see Figures 1.20-1.22 and associated text) and attach
the exhibits so that you have one document in pdf format that has both
your summary and your exhibits. You can send this to opposing counsel
and know that they cannot alter your document. Word processing
documents can be made “read only” but “there’s no way to lock this
on, so someone who is determined to make changes to the file can go
into the properties and turn off the read-only attribute.”1 It is easier to
send everything in pdf.
A second approach is to copy and paste portions of records (pdf
format) into the text of your word processing documents. The result
looks like sophisticated desk top publishing. Follow these steps.
1
Wempen, Using Microsoft Office Word 2007, QUE: 2007, p. 810.
56
Figure 1.50: Blocked image in pdf format ready to copy to clipboard.
Note: block lines not visible in Figure 1.50 but visible in eCopy
PaperWorks™ program.
Use the mouse to block the portion of the material you wish to
copy and release the left mouse button. A popup window will appear at
the lower right corner of the block, asking you whether you want to
Zoom In (see Figure 1.25 associated text) or to Copy to Clipboard. Select
Copy to Clipboard. Change to the Word 2007™ window; place the
cursor where you want to paste the material; and click <ctrl + v> to
paste it there.
57
Figure 1.51: Portion of pdf file pasted into Word 2007™ document.
In Figure 1.50 I used the commands <Alt + print screen> so I could
show the ribbon of the eCopy PaperWorks™ program. Figure 1.51
shows how the pasted material will appear. Note that there is no box
around the pasted image.
This presentation of imaging from pdf files in word processing
documents can be improved by creating a Text box in the receiving
document before pasting the image. In Microsoft® Office Word 2007
select Insert, Text Box from the ribbon, and Simple Text Box.
[Type a quote from the document
or the summary of an interesting
point. You can position the text
box anywhere in the document.
Use the Text Box Tools tab to
change the formatting of the pull
quote text box.]
Figure 1.52: Simple Text Box From Word 2007™
Figure 1.53: Text Box Template after instructional content is deleted
58
Delete the content of the Text Box to obtain image shown in Figure
1.53. Then enlarge it to accommodate the image to be pasted by using
the mouse at the corners and middle portions of the four lines. See
Figure 1.54.
Figure 1.54: Empty Text Box Enlarged to Accommodate Image
Figure 1.5: Text Box with image pasted therein
Then paste the image inside the box by clicking <ctrl + v>. It will look
like Figure 1.55. The box lines can be darkened or given color.
59
Figure 1.56: Simple Text Box with instruction content deleted and
borders made blue and wide.
Figure 1.56 can be achieved by placing the cursor inside the box,
clicking it once, clicking the Insert command tab, then Format from the
ribbon, Text Box Styles (small icon to right of Text Box Styles to go to
Advanced Tools), Colors and Lines, Line (click arrow button and click
desired color), Weight (click type in desired weight of line), and <OK>.
Figure 1.57: Portion of pfd content pasted into blue Text Box
60
VII. Document Transfers between PC and i-Pad™
Document management can be achieved without learning new
data base programs. You can take thousands of pages of records in pdf
format to meetings and depositions, storing them in your laptop or
iPad™. I show witnesses at deposition records in pdf format on my
iPad™ or laptop.
A.
Export pdf files to iPad™ from PC via iTunes™
Figure 1.58: iTunes™ open, reduced to half screen, showing Books.
1.
Link iPad™ to PC with USB cable.
2.
Open iTunes™ in PC and reduce the size of the display to one
half screen. See Figure 1.58.
61
Figure 1.59: eCopy PaperWorks™ open on right and iTunes™ open on
left
3.
Open eCopy PaperWorks™ reduce the size of the display to
one half screen and place it on the side opposite of the
iTunes™ display so that iTunes™ and eCopy™ are side by
side.
62
Figure 1.60: eCopy™ file (“Southshore Hospital”) highlighted
preparatory to pasting to Books in iTunes™
4.
In eCopy™ click the command tabs File, Open located above
the ribbon. Click the pdf file(s) to be copied and drag
it/them onto the iTunes™ side of the screen to the Books
section in the upper left corner. The Books corner of
iTunes™ will turn blue. Then release the left mouse button,
placing the copy in Books. See Figures 1.60, 1.61, and 1.62.
63
Figure 1.61: eCopy™ file (“Southshore Hospital”) highlighted and
dragged to Books, which area changes from gray to blue
Figure 1.62: eCopy™ file (“Southshore Hospital”) after having been
pasted to Books in iTunes™
64
Figure 1.63: iTunes showing iPad™ device clicked in Devices Menu
5.
Click iPad™ device icon in the iTunes™ Devices menu.
6.
Click Books in iTunes™ ribbon. Identify pdf file to paste and
click the small box to its left.
65
Figure 1.64: iPad™ Books open in iTunes™ in PC with document
Southshore Hospital checked for pasting to iPad™
7.
Click Apply to paste a copy to iPad™.
8.
To open the pdf file in iPad™ click iBooks™ from the main
menu, and then Library, Collections, PDFs. Click the pdf you
wish to open.
9.
Note that any Markups made in eCopy™ will be lost when
the pdf file is exported to iPad™. If you want to see the
Markups in the iPad™, move the cursor to the Markup and
then right mouse click and select from the pop up window
Make Markups Permanent. You may make all of the
Markups permanent when you use the Save As function by
selecting All from the Make Markups Permanent drop down
menu. See Figure 1.31 and accompanying text.
66
You may want to rename the document at this point to
preserve the reversible aspect of the original annotation and
the ability to remove or alter the Markups.
B.
Export pdf file to iPad™ from PC via DropBox™
Figure1.65: Dropbox™ website log in screen
You will need to create an account in Dropbox™. It is free. Log in to
your account. Click Files, Upload, Choose files. See Figure 1.66.
67
Figure 1.66: Two files selected for uploading to Dropbox™
After the files are uploaded from PC to Dropbox™, they will
automatically download to Dropbox™ on the iPad™.
Figure 1.67: Two uploaded files now seen in Dropbox™ file list
68
These files can be opened in Dropbox™ in the iPad™ and saved in
iBooks™. If you want your markups to show in iBooks™, you must make
them permanent before uploading the files. See Figure 1.31, 1.64, and
discussions which accompany those two figures.
The pdf files can be opened in the iPad™ in a program called
GoodReader™. This inexpensive app allows you to read Markups made
permanent before uploading and has tools for creating Markups and
notes. The drawback is that you cannot see 9 thumbnails at a time so
finding pages within lengthy file is not as efficient as in iBooks™.
GoodReader™ relies on a scroll bar on the left side of the screen for
navigation within a document. iBooks™ has better navigation but will
not allow any modification of the pdf file.
C.
Export Word™ files to iPad™ from PC via iTunes™
You can export word processing documents to iPad by two
methods: via iTunes and via Dropbox™. The iTunes™ method will be
discussed in this section and the Dropbox™ method will be explained in
the next section.
1. Have iTunes™ open and iPad™ connected to PC by USB
cable. See Figure 1.58.
69
Figure 1.68: iTunes™ with Apps open and Pages highlighted. Pages
Documents will be listed to right of Apps column. Word™ 2007 is open
on right side of screen.
2.
Scroll down to Pages™, which is the iPad™ word
processing application. See Figure 1.68.
70
Figure 1.69: iTunes™ open, Apps open, Pages open, Add clicked, pop
up window in PC open to select word processing documents for
pasting to Pages Documents column in iTunes™
3.
Under Pages Documents click Add to open your PC
directory of folders and documents. See Figure 1.69.
4.
Click Open in PC window. This puts the PC document in
the Pages Documents list in iTunes™. See Figure 1.70.
71
Figure 1.70: PC document shown as pasted in iTunes™ Pages
Documents
5.
In iPad™, open Pages™, touch the downward pointing
arrow at bottom of screen, select Copy from iTunes™.
Find desired document from the list, which is the same
list seen in iTunes™ under Pages Documents. Touch it,
and it will import.
6.
It is likely that iPad™ will say it had to change the font.
Click Done.
72
D.
Export Word™ files to iPad from PC via Dropbox™
Log on to Dropbox, click Files, Upload, Choose files to
identify the documents to be uploaded. These can be retrieved in the
iPad at Dropbox and opened in either Pages or GoodReader. See
Figures 1.65 – 1.67 and accompanying text.
E.
Export Pages™ files to PC from iPad™
1.
Save document in Pages™ by double tapping the gray
background below the new document prepared in
Pages™.
2.
Type new name in the small box where you see Blank 1
but do not add the suffix “Pages.” Click Done.
3.
Scroll in Pages™ until you see the document you want
to export. At the bottom of the screen are four icons.
The first one is a box with a rightward pointing arrow.
Touch that icon and select Send to iTunes™.
4.
The next screen will have the ribbon Choose Format.
Your choices are Pages, PDF and Word. Word
processing documents can be transferred in either PDF
or Word™. I recommend word processing documents
be saved in Word format.
5.
Connect iPad™ to computer and open iTunes in
computer. See Figure 1.58. Click iPad™ device icon.
See Figure 1.63.
73
Figure 1.71: Result in iTunes™ of finding Pages document in iPad™
(Voice Recognition for Trial Lawyers…”), clicking Send to iTunes™,
selecting Word. Pages™ document now listed in PC in iTunes™, Pages,
Pages Documents.
6.
At the devices ribbon in iTunes™, click Apps.
7.
Scroll to bottom of Apps and select Pages. See Figure
1.71. You will see a column of documents under Pages
Documents.
74
Figure 1.72: Result of clicking Save to with Pages Documents file
highlighted. Word processor file directories now open in PC so
document can be saved to PC
8.
Select name of document to be exported and click
Save To at bottom right of Pages Documents listing of
files. There will be a pop up window showing your PC
directories and folders. See Figure 1.72.
9.
In the PC pop up window, navigate to location where
you want to store the document in PC and click OK.
75
VIII. Internet document storage and transfer
A.
Sometimes you cannot email a large document because of
mail box space limitations. Large files, e.g., those large
medical records and the annotated versions of them, can be
stored in secure locations on the Internet. Google™ offers
email accounts with storage of documents that permits
uploading and downloading very large documents. This
permits easy transfer of large files from the firm’s file servers
to off-site computers and laptops.
B.
My secretary and I have a joint Google™ account entitled
[email protected] [TimSueOfficeDocuments]. Figure 1.73
shows the screen after logging on.
Figure 1.73: Google.com™ Gmail™ account open
76
On the screen shown in Figure 1.73, click Documents in the
Google™ ribbon. You will see the screen shown in Figure 1.74.
Figure 1.74: Google documents screen showing file folders and files2
Someone at the firm can Upload and you can Download off site.
You can create file folders and Upload to and Download from those
folders. To create a file folder in the My collections directory, click
Create New under the Google Docs logo in the upper left corner of the
2
My collections in upper left under Create new is collapsed to preserve confidentiality of my list
of files by plaintiff name.
77
screen shown in Figure 1.74. You will see a pop-up menu, as shown in
Figure 1.75.
Figure 1.75: Google Docs, Create new, Collection, to create a file folder
In Figure 1.75, click Collection to create a new file folder, which
will be a sub-folder of My Collections. That will bring you to a screen
similar to that shown in Figure 1.76.
78
Figure 1.76: “New collection” created and ready for name change;
plaintiffs’ names in My collections are redacted with Blackout for
confidentiality
Type the case name or other identifying word(s) and click OK. You
now have a new sub-folder to which you can Upload files and from
which you can Download files.
79
Figure 1.77: Google Docs™ screen for Uploading files
In Figure 1.77, click Upload, Files, and you will see your
computer’s open file screen as depicted in Figure 1.78.
80
Figure 1.78: Word processing screen listing documents
In Figure 1.78 click those documents you want to Upload to
Google Docs™, then click Open.
To Download documents from Google Docs™ to PC, place cursor
on document selected and click right mouse. You will see a screen
similar to that in Figure 1.79.
81
Figure 1.79: Google Docs™ screen for downloading files
C.
Exchanges of large files between client and lawyer
I have created a
[email protected]
pdf files of large medical
them. This allows us to
documents to emails.
Google™ email account entitled
and use it to Upload large files, e.g.,
charts, so my clients can Download
bypass the limitations of attaching
82
D.
Dropbox™ for Storage
Dropbox™ is a website and program which enables members to
upload, store, and download files. This is an alternative to Google
Docs™. Dropbox™ is discussed at Figures 1.65-1.67 and the text
accompanying those figures.
IX.
Conclusion
This paper suggests some of the many ways you can use pdf files
and programs like Microsoft® Word 2007 and eCopy PaperWorks™ to
create effective and inexpensive exhibits, store and transfer them via
such programs as Google Docs™ and Gmail™, and use these ideas in
your office practice. As you learn the many functions of the eCopy
PaperWorks™ program while tinkering with and learning the substance
of the pdf files, you can develop your own ideas of how to present the
material to the jury. Once you begin to use the technology, your
imagination and ingenuity will lead to a multitude of possibilities. With
practice, you will become proficient in using the PC for documentary
evidence.
Just think of the many possibilities, and your enthusiasm will lead
you to new ways to communicate, educate, and persuade
Slide 1
Evidentiary Issues Affecting
Peer Review Processes
PRESENTED BY JOHN F. WATSON
OF CRAIG & CRAIG, LLC
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
Slide 2
The Basics

The Illinois Medical Studies Act:

“All information, interviews, reports, statements, memoranda, recommendations,
letters of reference or other third party confidential assessments of a health care
practitioner's professional competence, or other data of the Illinois Department of Public
Health, local health departments, the Department of Human Services (as successor to the
Department of Mental Health and Developmental Disabilities), the Mental Health and
Developmental Disabilities Medical Review Board, Illinois State Medical Society, allied medical
societies, health maintenance organizations, medical organizations under contract with health
maintenance organizations or with insurance or other health care delivery entities or facilities,
tissue banks, organ procurement agencies, physician-owned insurance companies and their
agents, committees of ambulatory surgical treatment centers or post-surgical
recovery centers or their medical staffs, or committees of licensed or accredited
hospitals or their medical staffs, including Patient Care Audit Committees,
Medical Care Evaluation Committees, Utilization Review Committees, Credential
Committees and Executive Committees, or their designees (but not the medical records
pertaining to the patient), used in the course of internal quality control or of medical
study for the purpose of reducing morbidity or mortality, or for improving patient
care or increasing organ and tissue donation, shall be privileged, strictly confidential
and shall be used only for medical research, increasing organ and tissue donation, the
evaluation and improvement of quality care, or granting, limiting or revoking staff privileges or
agreements for services . . ..”

735 ILCS 5/8-2101 (2012)(emphasis added).
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Slide 3
Public Policy
 Encouraging frank evaluation and criticism balanced
against the interest of a patient in obtaining the facts
relating to his or her care
 The peer review privilege and its accompanying
statutory protections are premised on the belief that,
absent the privilege, physicians would be reluctant to
sit on peer review committees and engage in frank
evaluations of their colleagues.

Anderson v. Rush-Copley Med. Cntr., Inc., 385 Ill. App. 3d
167, 173-74 (2d Dist., 2008).
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Slide 4
What is Protected?
 State peer review privileges generally address three types of issues: immunity,
confidentiality and privilege.
 Immunity to individuals and institutions conducting the peer review process from
those persons adversely affected by the comment and criticism.
 “Furnishing information. The furnishing of such information . . . to in-hospital staff
committees or their authorized representatives, shall not subject any person,
hospital, sanitarium, nursing or rest home or any such agency to any action for
damages or other relief.”

735 ILCS 5/8-2103.
 The protections of the Act offering immunity will not apply if the statement do not
fall within the scope of the Act.

Kopolovic v. Shah, 2012 IL App (2d) 110383, ¶ 36 (2d Dist., 2012)(without specifically mentioning
§ 8-2103, the court found that the alleged libelous memorandum was not generated by a committee
engaged in peer review or internal quality control and thus civil immunity did not apply).
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Slide 5
 Confidentiality of comments, criticism, and details
about the peer review process.
 Confidentiality does not apply to criticisms prior to
the start of peer review.

Tunca v. Painter, 2012 IL App (1st) 110930, ¶¶ 15-16 1st Dist.,
2012)(plaintiff sought to create a private right of action for
improper disclosure under the Act).
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Slide 6
 Exceptions to Confidentiality:
 “Information obtained. All information . . . used in the course of
internal quality control or of medical study . . . shall be privileged,
strictly confidential and shall be used only for medical research . . .
except that in any health maintenance organization proceeding
to decide upon a physician's services or any hospital or
ambulatory surgical treatment center proceeding to decide
upon a physician's staff privileges, or in any judicial review of
either, the claim of confidentiality shall not be invoked to
deny such physician access to or use of data upon which
such a decision was based.

735 ILCS 5/8-2101 (emphasis added).
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Slide 7
 Breach of confidentiality is criminal conduct, but there is no
private right of action.
 “Improper disclosure. The disclosure of any information,
records, reports, statements, notes, memoranda or other data
obtained in any such medical study . . . is unlawful, and any
person convicted of violating any of the provisions of Part 21
of Article VIII of this Act is guilty of a Class A misdemeanor.

735 ILCS 5/8-2105.
 A private right of action for a breach of confidentiality is not
specifically set forth in the Medical Studies Act, nor is it
“implied to ensure compliance” with the statute.

Tunca, 2012 IL App (1st) 110930 at ¶¶ 19-22.
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Slide 8
 Privilege of the peer review work product from
discovery during litigation or from admission into
evidence at a hearing or trial.
 “Admissibility as evidence. Such information, records,
reports, statements, notes, memoranda, or other data,
shall not be admissible as evidence, nor discoverable in
any action of any kind in any court or before any
tribunal, board, agency or person. The disclosure of any
such information or data, whether proper, or improper,
shall not waive or have any effect upon its confidentiality,
nondiscoverability, or nonadmissibility.”

735 ILCS 5/8-2102.
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Slide 9
Context of Discovery
 Peer review information can be sought in the context of written
discovery, discovery depositions of a party, subpoenas, or discovery
depositions of non-parties.
 Written discovery.
 “Any objection to an answer or to the refusal to answer shall be
heard by the court upon prompt notice and motion of the party
propounding the interrogatory.”

IL Sup. Ct. Rule 213(d).
 “Any objection to the request or to the refusal to respond shall be
heard by the court upon prompt notice and motion of the party
submitting the request.”

IL Sup. Ct. Rule 214(d).
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Slide 10

Privilege log:

“Claims of Privilege. When information or documents are withheld from disclosure or
discovery on a claim that they are privileged pursuant to a common law or statutory privilege,
any such claim shall be made expressly and shall be supported by a description of the
nature of the documents, communications or things not produced or disclosed and
the exact privilege which is being claimed.”


IL Sup. Ct. Rule 2o1(n)(emphasis added).
“(p) Asserting Privilege or Work Product Following Discovery Disclosure. If
information inadvertently produced in discovery is subject to a claim of privilege or of workproduct protection, the party making the claim may notify any party that received the
information of the claim and the basis for it. After being notified, each receiving party must
promptly return, sequester, or destroy the specified information and any copies; must not use
or disclose the information until the claim is resolved; must take reasonable steps to retrieve
the information if the receiving party disclosed the information to third parties before being
notified; and may promptly present the information to the court under seal for a determination
of the claim. The producing party must also preserve the information until the claim is
resolved.”

IL Sup. Ct. Rule 2o1(n)(eff. Jan. 1, 2013).
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Slide 11

Depositions:

“Objections at depositions shall be concise, stating the exact legal nature of the objection. ”


IL Sup. Ct. Rule 206(c)(3).
“Motion to Terminate or Limit Examination. At any time during the taking of the deposition, on motion of any party or of
the deponent and upon a showing that the examination is being conducted in bad faith or in any manner that unreasonably
annoys, embarrasses, or oppresses the deponent or party, the court may order that the examination cease forthwith or may limit
the scope and manner of taking the examination as provided by these rules. An examination terminated by the order shall be
resumed only upon further order of the court. Upon the demand of the objecting party or deponent, the taking of the deposition
shall be suspended for the time necessary to present a motion for an order.”

IL Sup. Ct. Rule 206(e).

“As to Competency of Deponent; Admissibility of Testimony; Questions and Answers; Misconduct;
Irregularities.

(1) Grounds of objection to the competency of the deponent or admissibility of testimony which might have been corrected if
presented during the taking of the deposition are waived by failure to make them at that time; otherwise objections to the
competency of the deponent or admissibility of testimony may be made when the testimony is offered in evidence.

(2) Objections to the form of a question or answer, errors and irregularities occurring at the oral examination in the manner of
taking the deposition, in the oath or affirmation, or in the conduct of any person, and errors and irregularities of any kind which
might be corrected if promptly presented, are waived unless seasonable objection thereto is made at the taking of the deposition.”

IL Sup. Ct. Rule 2116(c)(1) and (c)(2).
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Slide 12
The Federal Rules
 Objections to interrogatories “must be stated with specificity. Any ground not stated
in a timely objection is waived” unless for good cause shown.

Fed. R. Civ. P. 33(b)(4).
 The receiving party must specify the part of the request to which it objects.
 Fed. R. Civ. P. 34 (b)(2)(C).
 The objecting party must “[1] expressly make the claim; and [2] describe the nature
of the documents, communications, or tangible things not produced or disclosed—
and do so in a manner that, without revealing information itself privileged or
protected, will enable other parties to assess the claim.”

Fed. R. Civ. P. 26 (b)(5)(A).
 When a subpoena for documents is directed to a nonparty under Rule 45, the
nonparty withholding information must expressly make the claim and describe the
nature of the documents being withheld.

Fed. R. Civ. P. 45(d)(2)(A).
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Slide 13
Non-parties and Waiver
 Deposition of a non-party:
 “At any time during the taking of the deposition, on
motion of any party or of the deponent . . . bad faith . . .
in any manner that unreasonably annoys, embarrasses,
or oppresses the deponent . . ..”

IL Sup. Ct. Rule 206(e).
 “The disclosure of any such information or data, whether
proper, or improper, shall not waive or have any effect
upon its confidentiality, nondiscoverability, or
nonadmissibility.”

735 ILCS 5/8-2102.
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Slide 14
When Peer Review Begins and When it Ends
 The peer review privilege will protect only information that is
actually part of the peer review process, and it therefore becomes
critical in establishing when actual peer review occurs when seeking
such protection.
 “If the simple act of furnishing a committee with earlier-acquired
information were sufficient to cloak that information with the
statutory privilege, a hospital could effectively insulate from
disclosure virtually all adverse facts known to its medical staff, with
the exception of those matters actually contained in a patient’s
records. As a result, it would be substantially more difficult for
patients to hold hospitals responsible for their wrongdoing through
medical malpractice litigation.”

Roach v. Springfield Clinic, 157 Ill. 2d 29, 41 (1993)
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Slide 15
 Contrast: Medical journal articles used by peer review
committees were privileged despite not having been
“initiated, created, prepared, or generated by a peer
review committee.”

Anderson v. Rush-Copley Medical Center, Inc ., 385 Ill. App. 3d 167,
175 and 183-87 (2d Dist., 2008) (quoting Chicago Trust Co. v. Cook
County Hospital , 298 Ill. App. 3d 396, 402 (1st Dist., 1998)).
 The Anderson court determined that since the articles
were obtained as a result of assignments given during
committee meetings and used by the committee in its
deliberations, disclosure would reveal the committee’s
internal process.

Anderson, 385 Ill. App. 3d at 176.
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Slide 16
 A hospital or medical facility cannot insulate adverse
facts known to the medical staff by furnishing such
reports to a peer review committee.

May v. Wood River Twp. Hosp., 257 Ill. App. 3d 969, 974 (5th Dist.,
1994).
 Once the peer review process ends, the actions taken as a
result of peer review are not privileged.

Green v. Lake Forest Hosp., 335 Ill. App. 3d 134, 137-38 (2d Dist.,
2002) (held no evidence that nurse’s suspension form was generated
by peer review committee; document found in nurse’s employee file
and only advised of three-day suspension).
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Slide 17
 For example, if certain surgical privileges of a
physician are removed after a peer review committee
hearing, the fact that the privileges of the physician
have changed is not confidential. The reasoning for
the committee’s decision within the process,
however, should be held in confidence.

Toth v. Jensen, 272 Ill.App.3d 382, 385-86 (1st Dist., 1995)
(holding that the Act protected annual surgery department
evaluation, memorandum from surgery department chair to
credentialing committee chair, and physician evaluations
because the credentialing committee made annual
reappointments and extensions of privileges only after
considering these documents).
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Slide 18
The Burden of Proof
 The recipient of a discovery request is initially
required to file some type of an objection or
exception to a discovery request.
 If the proponent of the discovery disagrees, that
party must bring the issue to the attention of the
court.
 The burden shifts to the party claiming privilege to
establish the legal applicability of the protection.

Roach v. Springfield Clinic, 157 Ill. 2d 29, 41 (1993);
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Slide 19
Evidence
 Affidavits
 Depositions
 Live Testimony
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Slide 20
Affidavits

Affidavits are a common method for providing evidentiary support for application of the peer review privilege.

Pros:



Cons:








Control of the information produced;
Effective as long as counsel provides a foundation for and attaches copies of the bylaws, policies, and procedures that address and direct the peer review
process.
Supreme Court Rule 191;
Affidavit(s) may be incomplete for purposes of providing a complete picture of the peer review process. Aspects of the evidence absent from an affidavit
may include the beginning date, the ending date, and the function within the process that created the documents.
An affidavit may lead to a deposition for purposes of discovery relating to the motion.
Chicago Trust Co. v. Cook County Hospital , 298 Ill. App. 3d 396(1st Dist., 1998).
The defendant hospital sought to protect nine documents.
In support of its position that the peer review privilege protected these documents, the hospital submitted several affidavits,
including those of the medical director, the chair of the hospital oversight committee (HOC), and four affidavits from an associate
administrator and a hospital attorney.
The court spent considerable time discussing the affidavits and how they related to the various documents, commenting that even
after five separate affidavits were submitted, it was still unclear as to whether some documents were prepared before the HOC met
and when it was advised of the occurrence. The court found unclear when the peer review process began and thus whether the
documents were created within that process or long after the process was over.
The court concluded that “The trial judge was given no facts concerning who made the request, when it was made, or where it was
made. The statement in the affidavits is pure conclusion, bereft of the facts.”

Chicago Trust Co., 298 Ill. App. 3d at 404.
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Slide 21
 Who is your Affiant:
 A person with a working knowledge of the peer review process, preferably with a working
knowledge of the bylaws, policies, and procedures that were put in place.
 Peer review Committee Chairperson.
 Risk Manager, if directly involved in Peer Review.
 What are you providing:
 Copies of the bylaws, policies, and procedures that address and direct the peer review process.

The witness should expect to testify as to what events trigger the peer review process, how
information is gathered to allow the committee or panel to conduct its review, and when the peer
review panel concluded its review.

Explain in detail how the reports, documents, opinions, statements, or testimony were generated
within the peer review framework for the purpose of peer review.

Show that the documents, incident or occurrence reports were not generated in the normal course
of hospital business, but pursuant to the Peer Review policy.

Take care not to provide conflicting information and avoid several affidavits being submitted to the
court.
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Slide 22
Deposition Testimony

Deposition testimony also has been used to support the application of the peer review privilege.

Pros:




Cons:





Avoids Rule 191 objections;
Can more effectively provide a foundation for bylaws, policies, and procedures that address and direct the peer
review process.
Testimony and witnesses may become distracted with objections, rather than focusing on the substantive content of
the peer review process that created the documents;
Ordinarily the plaintiff ’s attorney directs the initial line of questioning to the witness;
Objections not ruled upon in real time by the court;
Inability of the court to make inquiry of the witness.
An alternative might be for defense counsel to serve notice to depose defendant’s own
personnel and conduct the initial examination. Under such circumstances, counsel for the
physician, nurse, or health care facility would be in control of the line of questioning and the
documents produced.
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Slide 23
Live Testimony
 Live testimony offered by the party seeking protection is
the most persuasive and effective means for supporting
the peer review privilege.
 Pros:






Avoids Rule 191 objections;
Can more effectively provide a foundation for bylaws, policies, and
procedures that address and direct the peer review process;
Live testimony provides the judge with an opportunity to observe the
witness and weigh the credibility of the testimony
The Court can make additional inquiries on points that may be
unclear;
Allows the Court to directly inspect the documents, statements, or
reports in camera (if appropriate)
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Slide 24
In Camera Inspection
 The Carr court addressed, among other matters, whether an in
camera review of the material was warranted or even beneficial.
 In Carr , defendants contended the peer review statute created an
absolute privilege barring any disclosure, including in camera
review.
 Plaintiff urged the court to conduct an in camera inspection of the
documents to determine whether the content could substantively
demonstrate whether the documents were indeed created for the
purpose of peer review and pursuant to the process of peer review.
 The court noted that in camera inspection must be used only as a
last resort, not as a first step in the evaluation process.

Carr v. Howard, 426 Mass. 514, 689 N.E.2d 1304 (Mass. 1998).
A potential ethical position for the court if a witness’s trial testimony arguably
contradicts statements made by the witness in confidential peer review materials
that are examined by the court but not provided to the patient’s attorney.
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Slide 1
Do Litigation Hold Letters
Create a Conflict of Interest?
David H. Levitt and Starr M. Rayford
Hinshaw & Culbertson LLP
Illinois Association of Defense Counsel – February 2013
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Slide 2
The Problem?
 In many jurisdictions, under current e-discovery and
document/data preservation rules, litigation hold
letters by the attorney are arguably required in
almost every case.
 Because some courts have held to be discoverable
where spoliation issues arise, a potential conflict of
interest arises between attorney and client at the
time that the letter is sent.
 Arguably, under current and developing case law,
almost every lawyer in almost every case has a
conflict of interest the day that he or she is retained.
© 2012 Hinshaw & Culbertson LLP, an Illinois Limited Liability Partnership. All rights reserved.
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Slide 3
Standard Litigation Hold Letters
 Many firms now use standardized litigation hold
letters, developed to meet the standards of the most
onerous jurisdictions
 Sample letter
 Note:
•
•
•
•
The number of locations and devices to be
searched/preserved
To whom the notice should be given
Suspension of document destruction policies/preservation
of actual devices
Continuing obligation to preserve
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Slide 4
Where does this come from?
Zubulake
 Zubulake vs. UBS Warburg LLC, et al, 229 F.R.D
422 (S.D.N.Y. 2004) - Zubulake V
 Claim for gender discrimination and retaliation
•
April 2001 – UBS on notice of claim of gender
discrimination by Zubulake
•
•
August 2001 – Zubulake files EEOC Initial Charge
February 2002 – Zubulake files lawsuit
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Slide 5
Zubulake V, 229 F.R.D at 425
 PRESERVATION INSTRUCTION #1
•
August 2001 – in-house attorneys give oral instructions to
employees not to destroy or delete material – and to
segregate such material into separate files for attorney
review.



immediately after filing of EEOC Charge
pertained to both electronic and hard-copy files
did not specifically mention back-up tapes
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Slide 6
•
August 2001 – outside counsel meets with a number of
UBS’ “key players”

reminds them to preserve and turn over to counsel all files,
records, and other written memoranda

specifically instructs to preserve e-mails
•
February 2002 – inside counsel sends emails to key players
regarding preservation of evidence – immediately after
complaint filed
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Slide 7
•
August 2002 – outside counsel instructs UPS information
technology personnel to stop recycling backup tapes.
•
September 2002 – inside counsel re-sends preservation
email to employees
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Slide 8
 “Every UBS employee mentioned in this Opinion
(with the exception of Mike Davies) either personally
spoke to UBS’s outside counsel about the duty to
preserve e-mails, or was a recipient of one of
Salzberg’s emails.” (emphasis in original)
 Salzberg is inside counsel
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Slide 9
 In sum, counsel has a duty to effectively communicate to her
client its discovery obligations so that all relevant information is
discovered, retained, and produced. In particular, once the
duty to preserve attaches, counsel must identify the sources of
discoverable information. This will usually entail speaking
directly with the key players, as well as the client’s information
technology personnel. In addition, when the duty to preserve
attaches, counsel must put in place a litigation hold and make
that known to all relevant employees by communicating with
them directly. The litigation hold instructions must be
reiterated regularly and compliance must be monitored.
Counsel must also call for employees to produce copies of
relevant electronic evidence, and must arrange for the
segregation and safeguarding of any archival media (e.g.
backup tapes) that the party has to preserve.
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Slide 10
duty to preserve attaches, counsel must identify the sources
of discoverable information. This will usually entail speaking
them directly. The litigation hold instructions must be reiterated
regularly and compliance must be monitored. Counsel must
also call for employees to produce copies of relevant electronic
evidence, and must arrange for the segregation and
safeguarding of any archival media (e.g. backup tapes) that
the party has to preserve.
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Slide 11
attaches, counsel must put in place a litigation hold and
make that known to all relevant employees by
communicating with them directly. The litigation hold
instructions must be reiterated regularly and compliance must
be monitored. Counsel must also call for employees to
produce copies of relevant electronic evidence, and must
arrange for the segregation and safeguarding of any archival
media (e.g. backup tapes) that the party has to preserve.
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Slide 12
 “Unless counsel interviews each employee, it is
impossible to determine whether all potential
sources of information have been inspected.
 “In short, it is not sufficient to notify all employees of
a litigation hold and expect that the party will then
retain and produce all relevant information. Counsel
must take affirmative steps to monitor compliance . .
.” (italics in original)
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Slide 13
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Slide 14
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Slide 15
“Once a ‘litigation hold’ is in place, a party and her
counsel must make certain that all sources of
potentially relevant information are identified and
placed ‘on hold’ . . . To do this, counsel must become
fully familiar with her client’s document retention
policies, as well as the client’s data retention
architecture. This will invariably involve speaking with
information technology personnel, who can explain
system-wide backup procedures . . .”
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Slide 16
Zubulake Cases
 Zubulake I – 217 F.R.D. 309 (S.D.N.Y. 2003) –
ordered UBS to pay for restoring sample backup
tapes – cost approx. $19,000.
 Zubulake III – 216 F.R.D. 280 (S.D.N.Y. 2003) –
ordered UBS to pay 75% of the $165,000 cost of
restoring remaining backup tapes ($123,000) + incur
100% of legal expense for reviewing same
(estimated at $107,000) = $230,000)
 Zubulake IV – 220 F.R.D. 212 (S.D.N.Y. 2003) –
ordered UBS to pay plaintiff’s cost for re-deposing
certain employees whose electronic files had not
previously been produced.
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Slide 17
Zubulake V - Sanctions
 Pay for more re-depositions on newly discovered emails
 Pay to restore and produce additional backup tapes
 Adverse jury instruction
 Pay plaintiff’s attorney’s fees for the discovery
motions.
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Slide 18
Consequences of Zubulake
 UBS gave instructions to preserve at least FIVE
times
 UBS spent over $250,000 on restoration and
production expenses – by court order – before it had
been found liable for anything
 UBS was ordered to pay plaintiff’s costs for redeposing witnesses and costs of motion practice
 UBS was sanctioned with an adverse jury instruction
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Slide 19
Litigation Hold Letters – Privileged?
 Generally, litigation hold letters are privileged and
not discoverable – “ ‘litigation hold letters’ prepared
by counsel giving instructions to the client as to in
what manner to protect discoverable information are
protected by either the attorney-client privilege as to
legal advice or as to the attorney work product
doctrine because they were prepared in anticipation
of litigation and will disclose the attorney’s opinions
as to critical elements of the defense.”
Hoffman v. Aspen Dental Management, Inc., 2011
WL 1258053 (S.D. Ind. 2011), at *2
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Slide 20
Litigation Hold Letters –
Exception to Privilege?
 “In general, unless spoliation is at issue, a litigation hold letter
is not discoverable, particularly where it is shown that the letter
includes material protected by the attorney client privilege or
the work product doctrine.” Cannata v. Wyndham Worldwide
Corp., 2011 WL 3495987 (D. Nev. 2011), at *2.
 No per se rule on protection – party must show applicability of
the privilege
 “Even if a privilege does apply, moreover, GE has not shown
why the Court should not exercise its inherent power to order
[production of litigation hold procedure documents] in light of
Oleksy’s spoliation claim.” Oleksy v. General Electric Co.,
2011 WL 3471016 (N.D. Ill. 2011).
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Slide 21
Litigation Hold Letter –
Road Map for Sanctions?
 Failure to send a litigation hold letter sets up both the client
and lawyer for sanctions, even where (as in the Seventh
Circuit) it is not per se negligence
 But sending a litigation hold letter can also set up both the
client and the lawyer for sanctions
 Zubulake and progeny require counsel to participate in
preserving evidence – and even prior case law required
counsel to advise client on what to do
 Preservation requirements can be very expensive and need to
be done at the very outset of the case – clients may
reasonably resist incurring that much expense that early
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Slide 22
Litigation Hold Letter –
Road Map for Sanctions?
 If there is a threshold showing of spoliation, and the
court orders production of the attorney’s letter, the
letter potentially sets up a standard of care for the
client to follow – and risk sanctions if not followed.
 If a motion seeks sanctions against both the client
and the attorney, a conflict of interest between them
exists.
 Even if the motion is only against the client, the
client may look to the attorney for failing to assist the
client properly in preserving evidence, again
potentially creating a conflict of interest.
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Slide 23
Object Lesson: United Central Bank
 United Central Bank v. Kanan Fashions, 2011 WL 4396912
(N.D. Ill. 2011)
•
•
•
Spoliation claim for not preserving a server where ESI was stored
Motion sought sanctions against both the defendants and the
attorney
Litigation hold letter and other communications between lawyer
and client re preserving evidence were produced
•
Separate counsel needed for the client and the attorney – and
attorney had to withdraw from the case
•
Five day evidentiary hearing – in which counsel’s communications
to client re data preservation were prominently featured
•
Court held client, but not attorney, liable for sanctions – later
orders awarded >$322,000 in sanctions, and other sanctions
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Slide 24
David H. Levitt
Office 312-704-3515
[email protected]
www.hinshawlaw.com
Starr M. Rayford
Office 312-704-3718
[email protected]
www.hinshawlaw.com
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Seminar Materials - Illinois Association of Defense Trial Counsel

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