Path to More Cost Effective Litigation? An Explanation of Key Changes to the Federal Rules of Civil Procedure
April 18, 2016 by Brown Fox
On December 1, 2015 several amendments to the Federal Rules of Civil Procedure took effect. The 2015 amendments focus primarily on discovery and case management, and are the culmination of a five-year process of deliberation amongst the lawyers and judges of the Advisory Committee on the Federal Rules of Civil Procedure.
The Advisory Committee sought to improve four key areas: (1) greater cooperation among litigants, (2) greater proportionality in discovery, (3) earlier and more active case management by judges, and (4) preservation of electronically stored information (“ESI”).
The Advisory Committee has effected these changes recognizing that the modern-day litigation process has become far too expensive and time-consuming for the average litigant. If the 2015 amendments have their intended effect, the prosecution of a civil suit in Federal court will become a faster and less costly process. Thus, litigants are likely to benefit under these new changes as the amendments seek to reel this increasingly long and costly litigation process in order to better achieve the Rules’ stated purpose of securing “the just, speedy, and inexpensive determination of every action and proceeding”. Fed. R. Civ. P. 1.
The Advisory Committee‘s amendments affect more than 20 different provisions in the Federal Rules. Specifically, the amendments alter Rules 1, 4, 16, 26, 30, 31, 33, 34, 37, and 55, and abrogate Rule 84 and the Appendix of Forms. I have selectively highlighted some of the changes I believe to have the greatest impact.
Rule 26(b)(1), (d)(2): Proportionality That Meets the Needs of the Case
One of the most significant changes to Rule 26 was to ingrain a proportionality requirement for discovery in Rule 26(b)(1). While Rule 26(b) has always had a proportionality provision, the Advisory Committee found that judges and lawyers were not following it. To remedy this, the Committee chose to move the factors formerly found in Rule 26(b)(2)(C)(iii) to the now amended Rule 26(b)(1). Under the amended rule, proportionality is now part of the scope of discovery. Information must not only be relevant, but also proportional, to be discoverable. This means that discovery must be tailored to the reasonable needs of the case.
Litigants should note that this amendment is by no means designed to prohibit them from obtaining sufficient information through discovery to prove their case, but instead is aimed at precluding litigants from engaging in excessive or wasteful discovery. This change is likely to save both plaintiffs and defendants money as it will reduce practices that have contributed to the burgeoning cost of litigation, such as the use of unnecessary or overly burdensome requests for production, interrogatories, and depositions. Furthermore, it will limit a party’s ability to respond to proper discovery requests with baseless objections designed to cause a delay in the discovery process.
Another significant change made to Rule 26, was to add a provision to the rule permitting the early delivery of Rule 34 requests for production. Rule 26(d)(2) now permits a party to deliver Rule 34 requests for production before the Rule 26(f) conference has been held. This change is notable because prior to this amendment, the rule, for the most part, imposed a moratorium on seeking discovery before the parties held the required Rule 26(f) conference. The purpose of this amendment is to encourage detailed discussion of specific discovery proposals between the parties during the Rule 26(f) conference, and with the court at the initial case management conference, by helping the parties to clarify the contested issues that lie at the heart of the conflict.
Because these early Rule 34 requests for production are not considered to have been served until the first Rule 26(f) conference, rather than have a 30 day period in which to respond to these requests from the date the requests are delivered, the responding party has 30 days from the date of the first Rule 26(f) conference in which to respond to any Rule 34 request for production delivered prior to the Rule 26(f) conference.
Rule 16(b): Case Management Changes
Rule 16 was amended in a number of ways that affect case management in the early stages of a lawsuit.
While the former Rule 16 already called for early management of cases, the Advisory Committee found that, similar to the proportionality requirement of Rule 26, federal judges were not actively managing their cases in accordance with the rule. Thus, the changes to Rule 16 are designed to encourage more early and active case management.
One of the most significant of these changes pertains to the time frame in which the parties must hold a scheduling conference. The former Rule 16 required that a scheduling order be entered in the lawsuit within the earlier of either 120 days after any defendant has been served with the complaint, or 90 days after any defendant has made an appearance in the lawsuit. The amendment to Rule 16(b)(2) shortens this time period by 30 days. The amended Rule 16(b)(2) now requires that a scheduling order be entered within the earlier of either 90 days after any defendant has been served, or 60 days after any defendant has made an appearance. Thus, the parties now must confer and begin working together to provide the court with all information required for the court to issue a scheduling order much earlier than under the former Rule 16’s requirements.
The amended Rule 16(b) also includes a provision permitting a judge to include a requirement in the scheduling order that before moving for an order relating to discovery, the movant must request a conference with the court. The purpose of this provision is to provide judges and parties with a tool to use to more quickly resolve discovery disputes in an effective manner. The inclusion of this conference requirement in the scheduling order is likely something that will be discussed by the judge and parties at the initial case management conference. What this amendment means for litigants is that they are now more likely to avoid at least some of the significant cost and delay inherent in the process of briefing and deciding discovery motions that was prevalent under the former Rule 16.
Rule 4(m): Shorter Fuse to Serve Complaint
Similar to Rule 16(b)(2)’s amendment, the amendment to Rule 4(m) shortens the time period within which a defendant must be served with a summons and the complaint by 30 days. The former Rule 4 required that a defendant be served within 120 days after the complaint is filed. The amended Rule 4(m) now requires that the defendant be served within 90 days after the complaint is filed.
What this means for litigants is that they will want to be sure that their attorney takes action to promptly serve summons and the complaint on a defendant as soon as possible after the filing of a lawsuit. While 30 days may not seem like a significant amount of time, deadlines tend to approach much faster than most people expect in the busy world of civil litigation. An unsuspecting attorney may be caught off guard by this rule change, and litigants will want to ensure that their attorney is on his toes in meeting these new fast-approaching deadlines.
Rule 37(e): ESI Preservation
Rule 37 was amended to better address situations where a party fails to preserve ESI. ESI refers to any information that is stored in electronic format, such as electronic documents and communications, and the metadata that accompanies them. Preservation of ESI is a major issue confronting litigants in many modern-day lawsuits. Penalties for failing to preserve ESI can be severe. The new Rule 37(e) recognizes litigants’ common-law duty to preserve information when litigation is reasonably anticipated, and applies this duty to the preservation of ESI. In determining what measures a court may take against a party who has failed to preserve ESI, Rule 37(e) draws a distinction between a party who is merely negligent in failing to preserve ESI, and a party who, in failing to preserve ESI, acted with the intent to deprive another party of the information’s use in the litigation. In the latter situation, a litigant may find himself the subject of sanctions ranging from the court instructing the jury that it must presume the information that was not preserved was unfavorable to the party, dismissal of the action, or the entering of a default judgment.
What this means for litigants is that each litigant must be ready to take reasonable steps to preserve ESI when litigation is reasonably anticipated. These amendments are also likely to benefit litigants by reducing the cost and delay of civil litigation because they provide courts with a streamlined approach for handling situations where ESI has not been preserved, and constitute a credible deterrent to parties who would otherwise play out-of-bounds when it comes to preserving evidence that is valuable to the opposing party’s case.
Only time will tell just how effective the 2015 amendments to the Federal Rules of Civil Procedure will be. The goal of saving litigants time and money is a worthy one indeed, and my bet is that these amendments will succeed in doing just that.