Introducing Electronic Records Into Evidence

1. Introducing Electronic Records Into Evidence R. David Whitaker Associate General Counsel Wells Fargo Home Mortgage 515.213.4517 david.whitaker@wellsfargo.com

2. Introducing Electronic Records into EvidenceBasis for Admission • The Federal Rules of Evidence and the Uniform Rules of Evidence contain identical provisions that, taken together, address the admissibility of electronic business records: • The “Business Record” Rule, and • The “Best Evidence” Rule.

3. Introducing Electronic Records into EvidenceBasis for Admission • The Business Record rule permits the introduction into evidence of business records of regularly conducted business activity. A business record will be admissible: • If it is a record, in any form, of acts, events, conditions, opinions, or diagnoses, made at or near the time by, or from information transmitted by, a person with knowledge, and if: • The record is kept in the course of a regularly conducted business activity, and • It was a regular practice of that business activity to make the memorandum, report, record or data compilation, all as shown by the testimony of the custodian or other qualified witness, or by certification that complies with the Rules of Evidence, • Unless the source of information or the method or circumstances of preparation indicate the record is not trustworthy. • People v. Huehn, 53 P.3d 733 (Colo.App. 2002)

4. Introducing Electronic Records into EvidenceBasis for Admission • Even though a record is admissible under the business records exception to the hearsay rule, it must also satisfy the Best Evidence Rule. • The Best Evidence Rule, sometimes called the “Original Writing Rule,” provides that in order to “… prove the content of a writing, recording, or photograph, the original writing, recording, or photograph is required, except as otherwise provided in these rules or by Act of Congress.” • An “original” is defined as: [T]he writing or recording itself or any counterpart intended to have the same effect by a person executing or issuing it. … If data are stored in a computer or similar device, any printout or other output readable by sight, shown to reflect the data accurately, is an “original.” • People v. McFarlan, 744 N.Y.S.2d 287, (N.Y. Sup. 2002)

5. Introducing Electronic Records into EvidenceBasis for Admission • The UETA and ESIGN extend the existing principles of the “Best Evidence” rule, providing: • Any requirement to preserve or produce an “original” record is satisfied by an electronic record of the information in the record to be produced, so long as the electronic record: • Accurately reflects the information in the record to be produced after it was first generated in its final form, and • Remains accessible for later reference. • Evidence of a record may not be excluded solely because it is in electronic form.

6. Introducing Electronic Records into EvidenceProof of Document Integrity • Introduction into evidence will require proof of integrity • Identification to original transaction • Freedom from alteration

7. Introducing Electronic Records into EvidenceProof of Document Integrity • Courts evaluating the integrity of an electronic record may be expected to focus on systemic protections -- • division of labor • complexity of systems • Encryption of executed documents to prevent undetected alteration • activity logs • security of copies stored offsite to verify content

8. Introducing Electronic Records into EvidenceThe Amex Case • Amex sought to introduce print-outs of statement records in bankruptcy court. • The court on its own initiative stated that the electronic nature of the records necessitated, in addition to the basic foundation for a business record, an additional authentication foundation regarding the computer and software utilized in order to assure the continuing accuracy of the records. • The court refused to admit the electronic business records because it concluded that the evidence did not establish the declarant’s qualifications to testify or that the business conducts its operations in reliance upon the accuracy of the computer in the retention and retrieval of the information in question.

9. Introducing Electronic Records into EvidenceThe Amex Case • On appeal, the court endorses an eleven-step foundation process for computer records: • The business uses a computer. • The computer is reliable. • The business has developed a procedure for inserting data into the computer. • The procedure has built-in safeguards to ensure accuracy and identify errors. • The business keeps the computer in a good state of repair. • The witness had the computer readout certain data. • The witness used the proper procedures to obtain the readout. • The computer was in working order at the time the witness obtained the readout. • The witness recognizes the exhibit as the readout. • The witness explains how he or she recognizes the readout. • If the readout contains strange symbols or terms, the witness explains the meaning of the symbols or terms for the trier of fact.

10. Introducing Electronic Records into EvidenceSection 902 Certification • Usually, admission of a business record into evidence requires that a foundation be laid by testimony of the record custodian. However, the Rules of Evidence permit the creation of “self-authenticating” business records, so as to avoid the need for presentation of extrinsic evidence as a precondition to admissibility.

11. Introducing Electronic Records into EvidenceSection 902 Certification • The original or a duplicate of a domestic record of regularly conducted activity is admissible if accompanied by a written declaration of its custodian or other qualified person certifying that the record was: • Made at or near the time of the occurrence of the matters set forth by, or from information transmitted by, a person with knowledge of those matters; • Kept in the course of the regularly conducted activity; and • Made by the regularly conducted activity as a regular practice. • A party intending to offer a record into evidence under Section 902 must provide written notice of that intention to all adverse parties, and must make the record and declaration available for inspection sufficiently in advance of their offer into evidence to provide an adverse party with a fair opportunity to challenge them.

12. Introducing Electronic Records into EvidenceOther Document Control Issues • Physical protection • Hardened storage facilities • Offsite back-up • Protection from fraud or tampering • Employee background checks • Retention over time • Media deterioration • Migration of data over time