eDiscovery Daily Blog

• June 26, 2017

In First American Bankcard, Inc. v. Smart Business Technology, Inc., et. al., No. 15-638 (E.D. La., May 24, 2017), Louisiana Magistrate Judge Joseph C. Wilkinson, Jr. granted the Plaintiff’s Motion to Compel Discovery and for Reasonable Expenses against one of the defendants in “substantial part” with regard to interrogatories and requests for production of ESI within physical possession of the former owners of the defendant company, but denied “in limited part” with regard to the plaintiff’s request to take forensic imaging of the defendant company’s computer system, because “neither the relevance nor the proportionality of the forensic imaging sought by this request are readily apparent to the court”.

Case Background

In this case regarding damages the plaintiff allegedly incurred as a result of “deficient and defective” software design, manufacture and hosting of software products for use by plaintiff in processing cash advance and check cashing at casinos, the plaintiff served discovery requests, including document requests upon one defendant – Smart Business Technology, Inc. (Smart).  After determining Smart’s responses and objections to be lacking, the plaintiff filed a Motion to Compel and for Reasonable Expenses to obtain additional responses to certain interrogatories and certain document requests.

Judge’s Ruling

Judge Wilkinson granted the motion with regard to the plaintiff’s Interrogatories, overruling all objections and stating that “defendant has offered nothing sufficient to support or establish its objections on grounds of disproportionality and undue burden and expense outweighing the likely benefit of this highly relevant discovery.”

With regard to the defendant’s objections to producing requested ESI because it “does not have possession of the requested data” because it “is no longer a going concern” and, upon its business demise, the materials “remained in the hands of [its] former owners and top officers, co-defendants Fuente and Romero”, Judge Wilkinson stated that “[t]his argument is unpersuasive for two reasons… First, because defendant did not assert this argument in its Rule 34(b) written responses, the objection has been waived… Second, a party’s obligation to produce materials in the Rule 34 production and inspection process extends beyond mere possession. Defendant’s obligation is to produce such materials or electronically stored information (“ESI”) that are within its possession, custody or control…Rule 34’s definition of possession, custody, or control, includes more than actual possession or control of [documents]; it also contemplates a party’s legal right or practical ability to obtain [documents] from a [non-party] to the action.”

With regard to the plaintiff’s request to take forensic imaging of the defendant company’s computer system, Judge Wilkinson stated that the “motion is denied, at least at this time”, noting that “[u]nlike the discovery that is the subject of the interrogatories and requests for production addressed above, neither the relevance nor the proportionality of the forensic imaging sought by this request are readily apparent to the court.”

So, what do you think?  What does “possession, custody or control” mean to you?  Please share any comments you might have or if you’d like to know more about a particular topic.

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