On February 14, 2014, U.S. District Judge Denise Cote of the Southern District of New York became the latest judge to acknowledge that the results of technology-assisted review (TAR) need not be perfect to be defensible in Federal Housing Finance Agency v. HSBC North America Holdings Inc.
Earlier in the case, Judge Cote permitted defendant JPMorgan Chase to use TAR over the government’s objection; the government had sought manual review of every document. In a telephone conference held on July 24, 2012, Judge Cote stated that TAR “should be given careful consideration in a case like this, and I am absolutely happy to endorse the use of predictive coding and to require that it be used as part of the discovery tools available to the parties.” She asserted:
Ultimately, the use of predictive coding is a benefit to both the plaintiff and the defendants in this case. I think there’s every reason to believe that, if it’s done correctly, it may be more reliable—not just as reliable but more reliable than manual review, and certainly more cost effective—cost effective for the plaintiff and the defendants.
In her February 2014 opinion, Judge Cote refused to revisit discovery when one defendant sought to use documents produced by another defendant in the California component of the litigation to challenge JPMorgan’s production in the New York litigation. This other defendant claimed that JPMorgan should have produced those documents as well, and asserted that their production was defective due to their absence. Judge Cote noted that “the production of documents in litigation such as this is a herculean undertaking, requiring an army of personnel and the production of an extraordinary volume of documents.” Based on her research, “predictive coding had a better track record in the production of responsive documents than human review,” but “both processes fell well short of identifying for production all of the documents the parties in litigation might wish to see.” Therefore, despite the expense required to produce and review documents, “no one could or should expect perfection from this process,” and “[a]ll that can be legitimately expected is a good faith, diligent commitment to produce all responsive documents uncovered when following the protocols to which the parties have agreed, or which a court has ordered.”
This year has seen a retreat from a requirement to share all non-privileged documents in the seed set, and Judge Cote’s acknowledgement that every process is imperfect will enable counsel to push back against demands that they share non-relevant seed set documents. In an era where TAR is rapidly gaining acceptance in numerous courts, this ruling will help well-founded TAR processes withstand spurious challenges when “imperfections” are alleged. Finally, in the event of discovery disputes, counsel should engage in cooperative discussions backed by the expertise of e-discovery experts.