Sanctions are Up? Sanctions are Down? Which is It?

What goes up must come down. But something can’t go both ways at the same time. Or can it?

Last week on this blog, we reported that e-discovery sanctions had reached an all-time high. We based that report on a comprehensive survey of e-discovery cases published in the December 2010 issue of the Duke Law JournalSanctions for E-Discovery Violations: By the Numbers. The survey, conducted by three attorneys e attorneys in the e-discovery practice at the law firm King & Spalding, concluded, “There has been a significant increase in both motions and awards since 2004.”

No sooner did we post that than the law firm Gibson Dunn published its 2010 Year-End Electronic Discovery and Information Law Update. What did it conclude with regard to e-discovery sanctions? Sanctions are down — substantially down.

In perhaps the most important development in the sanctions area, the overall frequency of courts granting sanctions declined substantially compared to 2009 (granting sanctions in 55% of the cases where sought in 2010 from 70% in 2009). Many courts evaluated sanctions requests more cautiously and required a showing that the missing documents would have been relevant and favorable to the party seeking sanctions.

That’s not all. The law firm Williams Mullen also did a year-end survey of trends in e-discovery law. The headline of its survey? You guessed it: Sanctions are down.

[S]anctions were sought and awarded in slightly fewer cases this year. Of the 209 cases in which e-discovery opinions were issued in 2010, sanctions were sought in 79 (38%) and awarded in 49 (62% of the cases in which sanctions were requested, and 23% of all e-discovery cases). This is a decrease from 2009 when sanctions were sought in 42% of all e-discovery cases and were awarded in 70% of the cases in which they were requested (30% of all e-discovery cases). While costs and fees were by far the most common sanction (awarded in 60% of the cases involving sanctions), terminating sanctions, adverse inferences, and the sanctioning of counsel decreased significantly in 2010.

So which is it? Are sanctions up or down in e-discovery cases? How do we square the King & Spalding report with the reports from Gibson Dunn and Williams Mullen?

The simple answer is that, as a trend over years, sanctions are clearly up. As between 2009 and 2010, however, the data is conflicting. Using the numbers from the King & Spalding and Williams Mullen surveys, the actual number of cases in which sanctions were imposed rose from one year to the next. Gibson Dunn’s numbers show a drop.

Different Sets of Numbers

The King & Spalding survey analyzed all federal e-discovery decisions issued prior to Jan. 1, 2010. It looked at cases dating as far back as 1981 (although most were from 2004 or later). Over the course of those years, it saw a clear trend in which the number of sanctions steadily, even dramatically, rose. That trend culminated in 2009, when, as the report describes:

[T]here were more e-discovery sanction cases (ninety-seven) and more e-discovery sanction awards (forty-six) in 2009 than in any prior year. In fact, there were more e-discovery sanction cases in 2009 than in all years prior to 2005 combined.

By contrast, the Gibson Dunn and William Mullen surveys picked up where the King & Spaulding survey left off. It looked at cases through Dec. 31, 2009. The other surveys looked at cases beginning in 2010 and compared them to 2009.

Given that 2009 might have been called a “banner year” for e-discovery sanctions, it is less surprising that they would have dropped off for 2010.

Was There a Drop in 2010?

But did they drop off? As it turns out, the answer may be no.

According to the Williams Mullen survey, sanctions were sought in 79 cases and awarded in 49 cases in 2010. That is an increase in the number of actual sanction awards from 46 the prior year. As an overall percentage of cases, the number is down, but in actual awards, the number is up for 2010.

Gibson Dunn puts the actual number of sanction awards for 2010 even higher, at 55 cases. That would be a notable increase in actual sanction awards over the 46 cases identified for 2009 by King & Spalding. However, Gibson Dunn put the number of 2009 cases in which sanctions were awarded even higher, at 62. So, by its numbers, sanctions fell.

Needless to say, the numbers in these surveys do not square with each other. As another example, Williams Mullen says that sanctions were sought in 79 cases in 2010, while Gibson Dunn puts that figure at 100 cases (up from 88 in 2009, it says).

Even though the numbers do not entirely square, it seems safe to offer two conclusions:

  1. As a trend over time, sanctions as a subject of e-discovery litigation will continue to increase. Motions for sanctions have become a standard weapon in the litigation arsenal. Their use is only likely to increase. How courts will rule on these motions will depend on the facts and circumstances of each case.
  2. Regardless of the overall trend, there is one certain way for lawyers and litigants to avoid e-discovery sanctions. That is to be sure that their teams include people who understand the law of e-discovery and who are savvy about the technologies and procedures by which to comply with the law.

Over the course of the last decade, sanctions have steadily risen. That trend may fluctuate from year to year. But we are unlikely to see a dramatic downturn anytime soon.

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About Bob Ambrogi

Bob is known internationally for his expertise in the Internet and legal technology. He held the top editorial positions at the two leading national U.S. legal newspapers, the National Law Journal and Lawyers USA. A long-time advisor to Catalyst, Bob now divides his time between law practice and media consulting. He writes two blogs, LawSites and MediaLaw, co-authors Law.com's Legal Blog Watch, and co-hosts the weekly legal-affairs podcast Lawyer2Lawyer. A 1980 graduate of Boston College Law School, Bob is a life member of the Massachusetts Bar Foundation and an active member of the Massachusetts Bar Association, which honored him in 1994 with its President's Award.