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Zubulake v. UBS Warburg LLC “Zubulake III:

Zubulake v. UBS Warburg LLC “Zubulake III:. 2003 Southern District of New York. Parties. Laura Zubulake She moves for an order compelling UBS to produce all remaining backup e-mails at its expense. UBS Warburg LLC

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Zubulake v. UBS Warburg LLC “Zubulake III:

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  1. Zubulake v. UBS Warburg LLC“Zubulake III: 2003 Southern District of New York

  2. Parties • Laura Zubulake • She moves for an order compelling UBS to produce all remaining backup e-mails at its expense. • UBS Warburg LLC • The previous sampling that was looked at shows that the discovery costs should be shifted to Zubulake

  3. Facts • Zubulake earned approximate $650,000/year at UBS • She is suing for gender discrimination, failure to promote and retaliation. • She seeks electronic evidence stored on UBS back-up tapes

  4. Facts (cont’d) • Previous decision ordered the restoration of 5 back-up tapes. • The production of these backup tapes cost $19,003.43 • UBS now asks that the costs to produce the remaining be shifted to Zubulake

  5. Legal Framework • Rule 26(b)(2) • May subject the requesting party to protective under Rule 26(c) • Rule 26(c) • Protective orders including orders conditioning discovery on the requesting party’s payment of the costs of the discovery. • A court will order a cost-shifting protective order only upon a motion of the responding party to a discovery request, and for good cause shown. • Responding party has the burden of proof

  6. Analysis • Cost-shifting is appropriate when potentially inaccessible data is sought in discovery. • In order to determine if cost-shifting is appropriate the court applied the new 7-factor test in Zubulake I

  7. Factor One • The Extent to Which the Request is Specifically Tailored to Discover Relevant Information • There is no sign that the emails are going to reveal evidence related to gender.

  8. Factor Two • The Availability of Such Information from Other Sources • The contents of the emails are only available from the tapes. An email contains the precise words of the author and are a powerful form of proof at trial.

  9. Weighing Factors One and Two • Zubulake’s discovery request was narrowly tailored to discover relevant information. • Direct Evidence of discrimination may only be available through restoration. • Zubulake has demonstrated that there is probability that this evidence can be found in the email.

  10. Factor Three • The Total Cost of Production Compared to the Amount in Controversy • This case could potentially be a multi-million dollar case so $165,954.67 it would take to restore the documents is not significantly disproportionate. • This factor weighs against cost shifting.

  11. Factor Four • The Total Cost of Production Compared to the Resources Available to Each Party • UBS’s resources to pay for the restoration are much greater than Zubulakes. • She may be able to cover some of the cost of restoration. • This factor weighs against cost-shifting, but it does not rule it out.

  12. Factor Five • The Relative Ability of Each Party to Control Costs and Its Incentive to Do So • This factor is neutral. • A less-expensive vendor could be found • Zubulake is not able to cut back on her request because of the evidence found in the sample tapes.

  13. Factor Six • The Importance of the Issues at Stake in the Litigation • The litigation does not present a novel issue in discrimination. • This point is neutral.

  14. Factor Seven • The Relative Benefits to the Parties of Obtaining the Information • Zubulake stands to gain more than UBS. • Absent an order, UBS probably would never restore any of this data. • This factor weighs in favor of cost-shifting.

  15. Issue • Should the costs of retrieving inaccessible data be shifted to Zubulake? • Should the costs of review and production be shifted to Zubulake?

  16. Summary • Factors one through four weigh against cost shifting. • Factors five and six are neutral. • Factor seven favors cost-shifting. • Some cost-shifting is appropriate in this case. • There may be evidence that is only available on the tapes, but Zubulake has not shown that they contain indispensible evidence.

  17. Summary (cont’d) • The test shows that UBS should pay the majority share, therefore Zubulake must pay less than 50% • Zubulake will be required to pay 25% of the costs.

  18. Costs that are Affected • General Rule  Cost shifting only appropriate on the costs of restoration and searching. • The responding party should always bear the cost of reviewing and production for two reasons. • Exclusive ability to control the cost of reviewing the documents. • Once documents are ready to be reviewed, they are no longer inaccessible.

  19. Questions • How should companies begin to deal with back-up tapes now? Should they reduce the amount of back-up tapes they keep to the bare minimum required? • How can the court evaluate the importance of the evidence before its production? Should cost-shifting be debated after the production of documents?

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