Much has and will continue to be written about the redaction error in the Apple-Samsung litigation which resulted in a sanctions order reported in this morning’s news. For those not following the matter, a law firm associate, “working late one night,” failed to properly redact a document containing sensitive Apple information, which was then circulated to the firm’s client, in violation of a protective order.
The Court summarized the issues quite nicely:
A junior associate missing one redaction among many in an expert report is not exactly a historical event in the annals of big-ticket patent litigation. Even if regrettable, these things can happen, and almost certainly do happen each and every day. But when such an inadvertent mistake is permitted to go unchecked, unaddressed, and propagated hundreds and hundreds of times by conscious – and indeed strategic – choices by that associate’s firm and client alike, more significant and blameworthy flaws are revealed.
As the sanctions order makes clear, “[f]or the simple error in redaction … the court does not find that sanctions can reasonable be imposed.” The real concerns were the firm’s process for handling such redactions as well as its conduct after the error was made.
As to the review process, the firm described its mistake as stemming from an approach that was “650 lawyers wide and 1 lawyer deep.” The court found that, given the efforts by both counsel to prevent disclosures of discovery to the public, “then surely, logically, it would be worth a second, or even a third, round of review before producing it to a competitor corporation, who would know exactly how to exploit it.”
As to the subsequent actions, the court found that the firm failed to follow the procedures in the protective order to advise opposing counsel immediately once it learned of an inadvertent disclosure. The court allowed substantial discovery on the issue, with a number of lawyers being deposed. Based on its review of the record, the court found that at least one lawyer at the firm knew of the issue, and that the firm should have had in place better safeguards for addressing this information. If no lawyer at the firm “was responsible for knowing what documents had gone out to the client, such that that person would have been aware that the … report had gone out before, that is a flaw for which the firm must be held accountable.”
Luckily for the firm, the court did not impose the most severe sanctions sought, including “an injunction against [their client] … to a ten-year ban [on certain representations],” finding “insufficient evidence that this failure to notify or misuse ultimately implicated any issue in this or any other litigation or negotiation.” However, the court did award opposing counsel and their counse all costs and fees in pursuing the sanction, as well as other relief.
For now, we don’t know if the order will be appealed or the ultimate cost of this particular sanction. The firm has reportedly instituted a new redaction policy, requiring a second set of eyes on such things in the future. But, for now, the case presents an example of how running a case too leanly can pose risks requiring attention. And, it will create some interesting discussions between lawyers and clients when a client is insisting on efficient staffing at the same time a court is suggesting secondary and tertiary review in a document production.