Anyone that’s ever been involved in a lawsuit dreads the discovery process. In the United States, litigating parties typically must produce all relevant information that they possess or control to the other side—known as producing discovery—which can be very expensive and time consuming.

As little as 20 years ago, paper documents made up the bulk of the discovery documents that each side produced. Today, the amount of electronic documents available for production, from emails to PDFs to spreadsheets—known as eDiscovery—is many times greater than the paper documents of the past.

It’s estimated that by 2020 the volume of machine-to-person (M2P) as well as machine-to-machine (M2M) data will surpass person-to-person (P2P) data—just as the volume of electronic documents surpassed paper documents years ago. Companies fear that today’s Big Data will only get bigger and become impossible to manage.

For example, IT managers currently search high and low to find and produce all relevant information for a lawsuit. They often look at every potential data repository, including computers, servers, laptops, storage media, etc. Consequently, discovery for a commercial lawsuit can range from hundreds of thousands to millions of pages of electronic documents.

With the proliferation of the Internet of Things (IoT), the burden of discovery will increase again because IoT completely changes the nature and volume of data available for discovery. The number of places from which parties may need to collect, analyze, and produce discovery will be limitless.

IoT-enabled refrigerators, thermostats, light bulbs, or even your coffee maker will detect and store frightening amounts of data about your environment, all of which might be relevant to an underlying lawsuit and thus subject to discovery. For instance, sensor data generated from an Apple Watch, Google Glass, Jawbone health tracker, smart car, IoT-enabled traffic system, and embedded road sensor may all be discoverable in a lawsuit involving a car accident.

While it’s easy to panic over the exponential expansion of data, recent changes to U.S. law may relieve some of this burden. Last year, the U.S. Supreme Court amended the federal rules governing discovery to balance the burden by more forcefully imposing a proportionality requirement.

Proportionality Defined

Without getting into the legal minutiae, the new rules basically state that parties may obtain discovery that’s relevant to any claim in a lawsuit as long as the discovery is “proportional” to the needs of the case based on the following factors:

1) importance of the legal issues at stake in action, 2) amount of money in controversy, 3) the parties’ relative ease of access to relevant information, 4) the parties’ available resources, 5) importance of the discovery in resolving the issues in the case, and 6) whether the burden or expense of the proposed discovery outweighs its likely benefit.

In other words, before a party’s required to preserve and produce discovery on all of its IoT data, parties must weigh whether the burden’s commensurate with the value of the case and the importance of the data. After all, a party shouldn’t have to spend millions of dollars to preserve and produce marginally relevant data if the amount of damages in dispute is only a few hundred thousand dollars.

The new rules came into effect on December 1, 2015. IT professionals and lawyers are still working out how they should implement them and how the courts will apply them. But, at least one federal court in California has provided some some guidelines.

That court states that the proportionality standard should be applied to the discovery plan and all its elements, including the “preservation, collection, search, review, and production of ESI (Electronically Stored Information).” This arguably means that proportionality should be applied to every stage of the discovery process from preservation to final production. So a party might not only avoid producing certain IoT data, it might not even need to expend resources to preserve and collect that data if a court finds that it’s unduly burdensome and disproportionate to the needs of the case.

IoT Data Is A Good Thing

IoT will undoubtedly benefit society, including our legal process. New sources of evidence that can support or disprove a legal cause of action, such as a wrongful death suit or even a patent infringement case, will now be available. But it can also create unforeseen problems because information for the sake of information is not always a good thing, especially if it overwhelms the underlying process.

By redefining how litigating parties behave with each other, the new rules on “proportionality” may be able to get us through the anticipated flood of IoT data. Only time will tell how IoT will affect eDiscovery.

(About the authors: Kenie Ho is a partner at the global intellectual property law firm Finnegan, Henderson, Farabow, Garrett & Dunner, and leads the firm's Internet of Things (IoT) working group. Linda L. Vu is a staff attorney at Finnegan, Henderson, Farabow, Garrett & Dunner.)

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