Tar Heel EDiscovery

The North Carolina Court of Appeals articulated governing principles of electronic discovery and concluded that a trial court’s disclosure order was an abuse of discretion.

Despite the general disdain of courts for discovery disputes, in the words of Dorothea Dix, “[a]ttention to any subject will in a short time render it attractive, be it ever so disagreeable and tedious at first.” Dorothea L. Dix, Conversations on Common Things; Or, Guide to Knowledge. With Questions. For the Use of Schools and Families. 270 (4th ed. 1832). This appeal presents this Court with our first opportunity to address the contours of eDiscovery within the context of North Carolina common and statutory law regarding the attorney-client privilege and work product doctrine.

The interlocutor y appeal was from an order that permitted opposing counsel’s expert free access to electronic documents

Defendants appeal from an order compelling discovery that allows Plaintiffs’ discovery expert access to Fayetteville Technical Community College’s (“FTCC”) entire computer system prior to any opportunity for Defendants to review and withhold documents that contain privileged information or are otherwise immune from discovery. Defendants argue that the order compelling discovery constitutes an impermissible involuntary waiver of those privileges. Plaintiffs argue that the trial court’s order, in conjunction with a stipulated protective order consented to by the parties, adequately protects Defendants’ privileges such that no waiver will occur. After careful review, we hold that the trial court abused its discretion by compelling production through a protocol that provides Plaintiffs’ agent with direct access to potentially privileged information and precludes reasonable efforts by Defendants to avoid waiving any privilege. We therefore vacate the order and remand for further proceedings not inconsistent with this opinion.

Plaintiffs allege retaliatory dismissal for whistleblower activities.

The landscape

North Carolina authority regarding eDiscovery is bare bones, generally providing that “discovery of [ESI] stands on equal footing with discovery of paper documents.” N.C. R. Civ. P. 34, Comment to the 2011 Amendment (2017); see also N.C. R. Civ. P. 26(b) (defining ESI and including it within the scope of discovery subject to the same privileges as paper documents).

No statute, procedural rule, or decision by this Court or the North Carolina Supreme Court has delineated the parameters of eDiscovery protocols with respect to the protection of documents and information privileged or otherwise immune from discovery…

Although the advent of eDiscovery has undeniably altered how discovery is conducted by parties and overseen by courts, it has not thus far influenced North Carolina law regarding privileges. Fundamentally, the attorney-client privilege and work-product immunity doctrine attach to ESI in the same manner and to the same extent they apply to paper documents or verbal communications.

The search

While the use of search terms assists in preventing disclosure of privileged materials, it is far from a panacea. “[A]ll keyword searches are not created equal; and there is a growing body of literature that highlights the risks associated with conducting an unreliable or inadequate keyword search or relying exclusively on such searches for privilege review.”

The trial court order

In short, the Protocol Order provides Plaintiffs’ agent direct access to privileged information, which disclosure immediately violates Defendants’ privileges. It furthers that violation by directing that agent, having attempted to screen some privileged documents out through the use of search terms, to produce potentially responsive documents without providing Defendants an opportunity to examine them for privilege. If, following that continued violation, Plaintiffs—their agent notwithstanding—receive privileged documents, Defendants must attempt to clawback that information, reducing their privilege to a post-disclosure attempt at unringing the eDiscovery bell. Such compelled disclosure of privileged information is contrary to our law concerning both attorney-client privilege and work-product immunity. Cf. In re Miller, 357 N.C. at 333-35, 584 S.E.2d at 786-87; N.C. R. Civ. P. 26(b)(3). As a result, we hold the trial court misapprehended the law concerning attorney-client privilege and the work-product immunity (however understandably given its undeveloped state within the eDiscovery arena), vacate the Protocol Order, and remand for further proceedings.

The trial court may appoint a special master

we vacate the Protocol Order for an abuse of discretion and remand for further proceedings not inconsistent with this opinion