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A Discussion of Recent Changes to Electronic Discovery Best Practices in Canada

The third edition of “The Sedona Canada Principles for Electronic Discovery” embraces the overarching principles of “proportionality” and “cooperation.” Introduced in the first edition, best practices for these remain the same overall. However, the recent edition recognizes technological and societal changes, which impact how Canadian legal professionals manage electronic discovery (e-discovery). Updates better reflect the relationship between e-discovery and developing privacy regimes in Canada (and globally), address the role of information governance to facilitate e-discovery and incorporate recent rulings in the growing body of case law.

Many e-discovery principles overlap, so changes or additions to one principle often have application to others. The most significant addition, appearing throughout the third edition, is discussion of technology assisted review (TAR). TAR, or the use of AI, is deemed critical to saving time and money in the process of determining document responsiveness. With discovery costs skyrocketing due to the ever-increasing number of documents that must be searched, reviewed and stored, Canada’s latest Sedona principles recognize the important role technology plays in effective e-discovery.

Several principles warrant in-depth discussion, wherein adjustments expand the intent of those principles and affect overall practice. These include:

Principle 9

“During the discovery process, parties should agree to or seek judicial direction as necessary on measures to protect privileges, privacy, trade secrets, and other confidential information relating to the production of electronically stored information.”

Verbiage has been added to persuade parties not to rely solely on keyword searches, with parties instead encouraged to consider innovative approaches like TAR. Using keyword searches to identify privileged records will often cast a wide net, yielding both over- and under-inclusive results. There are limitations, as lists cannot be drafted to identify all and only privileged content. For example, on a recent matter, associates were convinced that their keywords would capture 100% of privileged records. However, when a TAR workflow was applied to the document set, key documents that would have otherwise been missed were identified. In addition to providing a more complete discovery, the TAR model helped validate the approach and ensure defensibility in a fully transparent manner. Models built on one case can “learn” and be used for others. This concept is now incorporated into documented best practice.

Principle 10

“During the discovery process, parties should anticipate and respect the rules of the forum or jurisdiction in which the litigation takes place, while appreciating the impact any decisions may have in related proceedings in other forums or jurisdictions.”

Updates were made here to outline nuances between different provinces. In Canada alone, the rules of discovery vary among the common law provinces, and the discovery process in Québec differs from discovery processes in the common law provinces. For example, British Columbia requires the disclosure of documents that could be used at trial to prove a material fact and all other documents that a party intends to refer to at trial. In Ontario, “relevant” documents must be produced, whereas in Alberta, “relevant and material” documents must be produced.

Globally, privacy laws also vary between jurisdictions. Europe has enacted stringent and wide-sweeping privacy laws that strictly regulate the collection, use and transfer of personal information. Principal 10 was updated to acknowledge that Global Data Protection Regulation (GDPR) limits the transfer of data outside the European Union in many circumstances. This includes possible transfers in respect to a foreign legal proceeding, as well as confidentiality and privacy case law which discuss data transfer prohibitions between “non-approved” countries.

Principle 11

“Sanctions may be appropriate where a party will be materially prejudiced by another party’s failure to meet its discovery obligations with respect to electronically stored information.”

Here, the terminology was softened, and there is expanded discussion on the tort of spoliation, or the intentional destruction of evidence from negligent or reckless destruction. For instance, the principal discusses where parties have digitized records and can no longer produce paper originals. Generally, record digitization will not be sufficient to ground a presumption of spoliation. In such instances, parties may agree that production of files in a different format, such as PDF, is adequate if sufficient indicia of reliability are present.

Principle 12

“The reasonable costs of all phases of discovery of electronically stored information should generally be borne by the party producing it. In limited circumstances, it may be appropriate for the parties to arrive at a different allocation of costs on an interim basis, by either agreement or court order.”

There is specific overlap here with the other principals, as it references proper and improper activities in conjunction with the Sedona Canada principles. It was updated to address rising costs and potential liabilities. Also, the principle acknowledges decisions made regarding processes and workflow can impact costs. For example, it may be unfair that a losing party in litigation should have to pay for discovery done poorly, inefficiently or in a manner that needlessly increased costs even if the party was unsuccessful in the case. Therefore, producing parties should take advantage of technology that enables them to be more efficient with e-discovery, such as leveraging machine learning in document review.

Costs are being reviewed in several cases according to whether technology was used. A non-exhaustive list was included in the third edition to potentially shift the cost burden of e-discovery.

Ultimately, lawyers have always wanted to get eyes on everything. However, we’ve reached a point where that’s simply not possible from a time and cost perspective, and it’s becoming increasingly less so. Revisions to the Sedona Canada Principles are meant to acknowledge where we are in the current need for TAR, as well as look to the future and identify the existing differences between provinces and jurisdictions throughout the larger world.

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The views expressed herein are those of the author(s) and not necessarily the views of FTI Consulting, its management, its subsidiaries, its affiliates, or its other professionals.