In Genius Sports Technologies Ltd -v- Soft Construct (Malta) Ltd [2022] EWHC 2637 (Ch) (‘Genius’), the High Court ordered the ‘massive overdisclosure’ of documents, after considering that the alternative approach involving electronic filtering of documentation gave rise to a significant risk that important documents may be omitted from review. In doing so, the court has reneged on recent disclosure reform (culminating in the ‘Disclosure Pilot Scheme’ in the Business and Property Courts now forming a permanent CPR Practice Direction) of limiting the total volume of documentation to be reviewed. It is worth considering why there has been this apparent change of heart in this case.
What is disclosure?
In commercial disputes, parties often place substantial reliance on documents to prove their claim. Disclosure involves identifying and making available documents that are relevant to the issues in the dispute to your opponent. The definition of documents is very wide. A ‘document’ means any record in which information of any description is recorded. Disclosure involved disclosing documents that are or have been in a party’s ‘control’. Disclosing such documents to your opponent is an essential part of the litigation process, ensuring that all parties have access to the same information and an opportunity to prepare for a fair trial. It is frequently only when disclosure has taken place that the legal teams are in a position to properly evaluate the claim and to predict the likely outcome.
What is e-disclosure?
The duty of disclosure covers electronic documents and e-disclosure is the process of collating electronic documents which are required to be disclosed. The process can be complex and often a third-party vendor specialising in e-disclosure is required to assist in the recovery and processing of the documents and the use of software to facilitate the process.
Practice Direction 57AD (‘PD 57AD’)
Where proceedings are commenced in the Business and Property Courts, disclosure is (with some limited exceptions) governed by the rules of PD 57AD. This set of self-contained rules was introduced precisely to meet the challenges imposed by an ever-increasing volume of electronic documentation.
PD 57AD specifies, inter alia, that:
- the parties (and their representatives) must cooperate with each other and assist the court so that the scope of disclosure can be agreed or determined by the court in the most efficient way possible;
- the court will be concerned to ensure that disclosure is directed to the issues in the proceedings and that the scope of disclosure is not wider than is reasonable and proportionate in order to resolve those issues fairly; and
- disclosure extends to ‘adverse’ documents, which means that documents must still be disclosed where the document or any information in it contradicts or materially damages the disclosing party’s version or contention of events on an issue in dispute, or supports the contention or version of events of an opposing party on an issue in dispute.
The court will determine the basis upon which documents are disclosable in respect of the identified issues. The court has a ‘menu’ of options which governs the basis on which documents are disclosed. The court is empowered to give directions on the following issues to reduce the burden and cost of disclosure:
- make an order for phased disclosure;
- make costs shifting orders;
- limit searches (custodians, dates, locations, categories of documents);
- require the use of data sampling, de-duplication techniques; and
- direct the use of technology assisted review tools
Genius
At a recent case management conference, in the Genius case the court had insufficient time to resolve a number of issues pertaining to disclosure, including finalising the Issues for Disclosure and Models to a be applied. It therefore listed a second case management conference to address the same. In revising its original disclosure order and notwithstanding the above backdrop, Mr Justice Marcus Smith imposed a bespoke disclosure regime, ordering the ‘massive overdisclosure’ of documents by only excluding from the disclosure exercise ‘unequivocally irrelevant and privileged documents’ leaving the receiving party to review the documents itself.
He premised his decision on the basis that the case satisfied four key conditions:
- the apparent risk that if the standard process of disclosure was to be adopted, relevant documents would be omitted;
- that there was no danger of the process being used to oppress a party;
- the risk of inadvertent disclosure of privileged material was minimal; and
- that any confidential material was to be protected.
Conclusion
The decision in Genius appears to go against the general direction of travel in recent reforms to disclosure which concentrated on reducing the disclosure burden rather than increasing it. Proponents of the approach in Genius may argue that by erring on the side of over inclusion, this improves the overall disclosure process and saves costs. On the other hand, overdisclosure can lead to a significant burden (and therefore costs) on the receiving party’s lawyers who then have to review large volumes of material which has not been filtered by the providing party’s legal team for relevance. This can be particularly problematic in complex cases where there are multiple issues at stake, very large amounts of documentation and the importance of specific documents may not be immediately apparent.
Regardless, while the court was careful to limit its approach in Genius to the facts of that particular case (an IP/competition matter), it highlights the ongoing challenges posed by electronic disclosure and the need for a more efficient and effective approach to managing the disclosure process in complex litigation beyond the current parameters of PD 57AD, for litigants and practitioners alike. In this regard, the judge commented that it seemed “evident” that the prescribed disclosure regime in this particular case “had not worked satisfactorily”. In particular, the judge noted:
- most documents are electronic and searchable using “basic software … available to all”. “Eyeball” reviews have become “marginalised”;
- electronic filtering raises a real risk of really important documents not being looked at by “any human agent”;
- where there is no confidence that the electronic filter will not discard relevant material, the use of Lists of Issues and disclosure models is a “fatally flawed process”;
- “Document dumping” no longer “compels mass reading” by the opponent’s lawyers, as targeted electronic review processes are available.
- “Massive overdisclosure” no longer risks really important documents being overlooked.
It will be interesting to see whether this case opens the door to wider criticism of PD 57AD and eventual reform or whether it is a one-off. Regardless, there was recognition in this case that each and every document disclosed is unlikely to be human reviewed and that targeted electronic searches and filtering techniques should be deployed.
For further information, please contact:
Jonathan Scally, Hill Dickinson
jon.scally@hilldickinson.com
