Koninklijke Philips v. Hunt Control Systems – New Jersey District Court Finds Deposition To Explore More Sophisticated Cloud Computing Tools For ESI Discovery Unnecessary And Burdensome

In this multi-billion dollar intellectual property dispute, the defendant Hunt Control Systems, Inc. served the plaintiff Koninklijke Philips N.V. (“Philips”) with a discovery request and interviewed a Phillips’ IT/ESI discovery professional regarding their ESI practices. Months later, believing Phillips’ e-discovery approach to be inadequate, Hunt noticed a deposition for an IT witness pursuant to Fed.R.Civ.P. 30(b)(6) to explore Phillips use of ESI search tools. Phillips objected and an order staying the deposition was issued allowing Hunt to seek answers from Phillips on eight questions regarding the ESI discovery that Hunt alleged were not adequately answered by Phillips. Hunt again requested a deposition of an IT witness and Phillips was given permission to file a motion for a protective order. The Court directed Hunt to “explain why there are material deficiencies” in the discovery already produced.
While the Court noted that Rule 26 is to be “construed liberally” it stated that there are limits to the permissible scope of discovery, specifically where it is “unreasonably cumulative or duplicative” or can be obtained from a less burdensome source. In such cases, the court can issue a protective order to protect a “party or person from annoyance, embarrassment, oppression or undue burden or expense.”

In support of its deposition request, Hunt asserted that the IT deposition was necessary to determine if Phillips was using the “appropriate search tools for ESI discovery.” In the opinion of Hunt’s expert, Philips’ cloud-based IT structure gave it access to comprehensive and state-of the-art-document search and location tools that Philips refused to use.
In its analysis granting the protective order, the Court found that Philips made adequate representations to the Court that its approach to ESI discovery was reasonable. It further found that Hunt did not make the requisite showing that Phillips’ production has been materially deficient noting that its categories of deficient production were speculative and explained by Philips. The Court noted that Hunt’s alleged dissatisfaction with the result of Phillips’ production is insufficient to reopen the door to the collection of ESI using an entirely different method based solely on Hunt’s expert who simply stated that alternative tools were available to Philips which it failed to use. The Court was not persuaded that an alternative approach to ESI collection was more appropriate that the custodian based search used or that it would have substantially altered the production already made. It found that another approach would have been duplicative and an inefficient use of time and resources.

In granting the protective order, the court found Phillips approach to eDiscovery reasonable, holding that while the requested deposition itself would not be a burden it had the possibility of opening the door to discovery that could extend on indefinitely.

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