Delaware Chancery Homes In on EDD

In a spate of recent rulings, the court signals that companies need to engage in early preservation of data

If lawyers viewed the dearth of Delaware Court of Chancery electronic discovery rulings as evidence of the court's lack of concern about e-discovery battles, a spate of recent rulings and opinions from the court may have dispelled any false comfort.

The court issued two letter rulings and two opinions between May 18 and June 2 squarely addressing e-discovery issues. Lawyers say the decisions flesh out the Chancery's sparse e-discovery case law, which was previously tackled by only a handful of cases since 2002. Given the court's role as judiciary for the array of U.S. companies chartered in Delaware, the changes are likely to have an outsized effect on corporate practitioners, lawyers who practice in the state say.

The new rulings address a panoply of issues, including early preservation of evidence and who should pay for expensive data-recovery projects. The two opinions grant adverse inferences -- when a court considers missing evidence to be harmful to the party that can't produce it -- for data destruction. They also award costs and legal fees to the party that made the motion to address the issue.

Kevin Brady, vice chairman of the business law group at Wilmington, Del.'s Connolly Bove Lodge & Hutz and a member of the Court of Chancery Rules Committee, said the rules changes show that e-discovery is becoming a more visible issue with the court. "It's a wake-up call for practitioners," Brady said. "It's telling practitioners that it's probably a good idea that everyone look at these issues sooner rather than later."

To Continue Reading: Click Here
-----------------------------------------------
Source: law.com
By: Sheri Qualters