Proposed FRCP Amendments: Rule 37

November 24, 2014

FCRP updateUp next in our series on the proposed amendments to the Federal Rules of Civil Procedure is Rule 37.

The proposed amendments would modify Rule 37 in three main ways. First, Rule 37(a)(3)(B)(iv) currently allows a party to “move for an order compelling an answer, designation, production or inspection…if a party fails to respond that inspection will be permitted—or fails to permit inspection—as required under Rule 34.” The Rule would be amended to also allow for a motion to compel if a party failed to produce documents.

This change corresponds to the amendment to Rule 34, which recognizes that parties often produce copies of documents rather than permit inspection of documents.

The other two changes to Rule 37 are intended to address the failure to preserve Electronically Stored Information (ESI).  Rule 37(e) currently asserts “absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically store information lost as a result of the routine, good-faith operation of the electronic information system.”

The Committee recognized that a more detailed rule was needed to establish uniformity in judicial responses to the loss of ESI. The proposed amendments do no create a duty to preserve ESI, but focus on the response to a failure to preserve information in the reasonable anticipation of litigation.

Under the proposed amendments, Rule 37(e)(1) would state “upon finding prejudice to another party from loss of information, [the court] may order measures no greater than necessary to cure the prejudice.”

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The proposed rule does not indicate which party has the burden of proving prejudice. Public comments advised that opposing parties often have difficulty proving they were prejudiced by the loss of information they have not been able to examine. In response, the Committee Note indicates that judges will have discretion in determining how to assess prejudice.

The proposed Rule 37(e)(2) is meant to put an end to a circuit split on when an adverse inference jury instruction may be given. Rule 37(e)(2) would provide “the court…only upon finding the party acted with the intent to deprive another party of the information’s use in the litigation may: (A) presume that the lost information was unfavorable to the party; (B) instruct the jury that it may or must presume the information was unfavorable to the party; or (C) dismiss the action or enter a default judgment.”

The Committee Note directs courts to use caution in ordering the 37(e)(2) remedies and indicates that a finding of intent to deprive another party of lost information does not automatically require a court to use the measures prescribed therein, especially if the lost information was unimportant or if a lesser remedy would suffice.