Are Instant Messages Discoverable?

In 1984, George Orwell wrote of a society in which technology was used to control and monitor social behavior ' “Big Brother is watching you.”

Big Brother technology is no longer the realm of science fiction. Whether we actually use technology in this fashion, however, is the important question that policymakers and judges will have to answer. Indeed, the technology to digitally record virtually everything we do and say is well on its way to being pervasive and less and less expensive. PCs often have Webcams and microphones, and personal digital assistants and cell phones have audio recording capabilities and many have cameras.

e-Mail has certainly changed the way businesses communicate, and many commentators predict that instant messaging (IM) is poised to bring about the next corporate-communications revolution, an event that raises numerous questions for today's corporations. Consider these questions, for instance:

• What do companies need to know about IM technology before allowing or encouraging its use in the workplace?
• What retention obligations attach to IM during the ordinary course of business?
• Do those obligations change when litigation is anticipated?
• What discovery obligations come with the revolution?
• And will we be transformed into a kind of 1984 society where even the most transitory conversations are monitored, recorded and saved?

Those are the essential questions that corporate legal departments and, ultimately, trial and appellate courts, must answer.

IM: A New, And Popular, Dimension

The popularity of IM has grown explosively, especially among young users. Initially perceived, inside and outside of corporations, as a frivolous time waster ' a way for teens to dish gossip with their friends or a substitute for employee water-cooler conversations about the Friends finale ' IM is being embraced by corporate workers nationwide. It is now increasingly common for employees to use IM to conduct business that previously was conducted over the phone. Consider, for example, the possibility of using IM as a free alternative to long distance ' particularly international ' phone calls. It allows friends and colleagues to chat and multitask during meetings or while doing other things. Many workers have recognized the benefits of this new communication medium and adapted their business practices to take advantage of it.

But will IM communications remain as ephemeral as the telephone conversations and hallway conversations they replace? The answer to that question depends on whether transcripts of the messages are made, and whether those transcripts are printed or otherwise recorded. Consistent with the treatment of the conversations that IM communication replaces in the corporate environment, it is not necessary to record such IM interactions unless doing so is the pre-established business practice of the IM user.

SEC and NASD Guidance

Some heavily regulated industries, such as financial services, have specific guidance on document retention in the ordinary course of business. For example, the Securities and Exchange Commission (SEC) and the National Association of Securities Dealers (NASD) have placed IM squarely in their sights as potentially relevant repositories of business information.

Both organizations promulgated rules that place the same 3-year retention requirements on IM as currently exist for e-mail and other forms of written communication. See SEC Rule 17a-4(b)(4); NASD Rule 3110.

In NASD's notice to members, it further indicated that member firms should not use IM platforms that do not support archiving and retrieving of IM conversations. For firms regulated by these bodies, therefore, the decision regarding whether to take active steps to record IM has been made.

(For more on legal considerations of using instant messaging in the financial-services sector, see “IM: Plenty of Benefits, But Risks Too” in the March 2004 edition of e-Commerce Law & Strategy.)

Companies not bound by the SEC or NASD rules have no clear guidance about their IM document-retention obligations. Most companies are guided by the principle that documents should be retained only when there is a business purpose or need, or other statutory or legal requirement. Given IM's purpose ' real-time communications like a phone conversation ' a legitimate case can be made for adopting a retention policy that discourages or prevents IM recording in the ordinary course of business. After all, there is no document created unless additional steps are taken to create a record of the conversation. While tape recordings of conversations may be considered stored information and potentially subject to retention, a corporation is under no affirmative duty to record oral communications that ordinarily would not have been recorded. The same could logically apply to IM.

Ordinarily Done, Or Not?

So the question is whether, in the ordinary course of business, absent some legal requirement, a company must ever record IM. If the answer is yes, then the following argument could be made: Why not require that all phone conversations, or for that matter, all meetings, conference calls and conversations in the hallway, be recorded? After all, IM, like phone calls, are just bits of digital data transmitted over fiber-optic lines from one device to another.

But retention obligations may change when litigation is anticipated. As soon as litigation is reasonably anticipated, and certainly before a document request is served, a party must take reasonable steps to preserve evidence over which it has control and that is reasonably likely to be material to the potential action and the subject of a discovery request. See, eg, Wigington v. CB Richard Ellis, 2003 WL 22439865 (N.D. Ill. Oct. 27, 2003).

Such evidence is usually embodied in what most people think of as documents. The very nature of electronically stored information, however, has changed, and will continue to change, notions of what elements compose a document and what a document comprises. Two questions arise at this point:

• Are IM conversations that were archived in the ordinary course of business documents subject to discovery?
• Do retention obligations regarding IM change once litigation is anticipated?

Federal Rule of Civil Procedure 34 provides for requests for “documents,” including “electronic data compilations.” Today, electronically stored information, such as e-mail, is included in the definition of a document because that is how lawyers and judges are used to thinking of fact discovery. In reality, the term document is an inherently arbitrary concept when applied to electronically stored information. A letter written in Microsoft Word, for example, is really just information that can be understood by Microsoft Word software, which then displays some of the information on a screen or prints it into what we commonly think of as a paper document. Other parts of the data file are not displayed and can be accessed only by viewing the metadata or embedded data. The computer file, however, is itself simply information: information about the letter text; font; page margins and embedded information about changes made to the letter; editors who worked on the letter; and so on.

The fact that all of this information is contained in one file the name of which ends in .doc, however, is purely a design decision by Microsoft engineers. The information could just as easily be divided into multiple files that are simply associated with one another; for example, the text information could be in one .doc file, the formatting information in a .fmt file and the editing information in a .edt file: which file is then the document?

A change to the federal rules that incorporates “electronically stored information” into the Fed. R. Civ. P. 34 definition of the term document, it can be argued, will stand the test of time better than a definition dependent on current notions of what we think of as documents. Such an addition to the federal rules was recently proposed by the Advisory Committee on Federal Rules of Civil Procedure to the Standing Committee on Rules of Practice and Procedure. Ultimately, it is information that is stored in whatever media happen to be in use at the time, which is discoverable in litigation.

Probably Discoverable, If Recorded

Whether IMs are “electronically stored information,” and, therefore, documents potentially discoverable when litigation is filed, depends on numerous factors, such as:

• The IM software program in use and its default settings;
• The options that have been activated by the users or their corporate information-systems personnel, or both, in deploying that system; and, in some instances,
• Whether the individuals have taken steps to record the particular conversation (for example, by checking a dialogue box, or by cutting and pasting the text into a file and saving it there).

If Fed. R. Civ. P. 34 is amended to include “electronically stored information, then the conclusion that stored IM conversations are discoverable is unavoidable. The question, however, is this: When does an IM conversation change from being an ephemeral exchange of information to one that is considered stored and then subject to the same requirements as other electronically stored information?

Although many IM platforms initially did not permit the user to record a conversation, many software developers have incorporated archival and retrieval capabilities in their IM software. It could be feasibly argued that as IM users recognize such capabilities, more of them will begin recording and referring back to IM communications in much the same way that they do with e-mail. It's only a matter of time before attorneys routinely include a request for IM conversations on topics relevant to litigation in their discovery requests. There can be little debate, then, that IM conversations, if recorded, are discoverable in litigation and must be preserved if one has reason to anticipate relevant litigation.

An Obligation to Record?

The question of whether an obligation to start recording potentially relevant IM arises once litigation is anticipated is far less clear. While it is true that with many IM services, it is fairly easy to record a conversation as a text file, instituting a requirement to record IM conversations could be considered akin to requiring all corporate employees to begin recording routine telephone conversations or meetings that might bear on the case in question, merely because that is technically possible, though not done in the ordinary course of business. This is clearly not the law, and never has been.

The key is that information that comes into tangible existence, ie, is stored in some capacity in the ordinary course of business, is subject to discovery. But does the mere ability to store that information justify a new obligation of a party to a case to create and maintain wholly new documents solely for discovery in the litigation?

Although a litigant might be required to compile existing data, he or she generally cannot be compelled to create information that doesn't exist, and never has. Thus, while tape recordings of conversations may be considered stored information subject to preservation if litigation is anticipated, a party is under no affirmative duty to record oral communications that have not otherwise been recorded in the ordinary course of business. The same would seem to apply to IM conversations not recorded by the participants in the conduct of their daily business.

As the very name implies, all software products are inherently flexible and easy to redesign to serve new purposes and be more effective. Just as car companies produce new models every year with updated styles, designs and technologies, software companies update and improve their products regularly to meet consumer demand and keep up with competitors. Undoubtedly as technology advances, courts and litigants will continue to struggle with the definition of document, along with which document-retention obligations in the ordinary course of business and when litigation is anticipated. Just because technology permits us to record and preserve for eternity every spoken or written word doesn't necessarily mean that Big Brother surveillance is good, or needed, for business, or as a matter of law and policy.

In 1984, George Orwell wrote of a society in which technology was used to control and monitor social behavior ' “Big Brother is watching you.”

Big Brother technology is no longer the realm of science fiction. Whether we actually use technology in this fashion, however, is the important question that policymakers and judges will have to answer. Indeed, the technology to digitally record virtually everything we do and say is well on its way to being pervasive and less and less expensive. PCs often have Webcams and microphones, and personal digital assistants and cell phones have audio recording capabilities and many have cameras.

e-Mail has certainly changed the way businesses communicate, and many commentators predict that instant messaging (IM) is poised to bring about the next corporate-communications revolution, an event that raises numerous questions for today's corporations. Consider these questions, for instance:

• What do companies need to know about IM technology before allowing or encouraging its use in the workplace?
• What retention obligations attach to IM during the ordinary course of business?
• Do those obligations change when litigation is anticipated?
• What discovery obligations come with the revolution?
• And will we be transformed into a kind of 1984 society where even the most transitory conversations are monitored, recorded and saved?

Those are the essential questions that corporate legal departments and, ultimately, trial and appellate courts, must answer.

IM: A New, And Popular, Dimension

The popularity of IM has grown explosively, especially among young users. Initially perceived, inside and outside of corporations, as a frivolous time waster ' a way for teens to dish gossip with their friends or a substitute for employee water-cooler conversations about the Friends finale ' IM is being embraced by corporate workers nationwide. It is now increasingly common for employees to use IM to conduct business that previously was conducted over the phone. Consider, for example, the possibility of using IM as a free alternative to long distance ' particularly international ' phone calls. It allows friends and colleagues to chat and multitask during meetings or while doing other things. Many workers have recognized the benefits of this new communication medium and adapted their business practices to take advantage of it.

But will IM communications remain as ephemeral as the telephone conversations and hallway conversations they replace? The answer to that question depends on whether transcripts of the messages are made, and whether those transcripts are printed or otherwise recorded. Consistent with the treatment of the conversations that IM communication replaces in the corporate environment, it is not necessary to record such IM interactions unless doing so is the pre-established business practice of the IM user.

SEC and NASD Guidance

Some heavily regulated industries, such as financial services, have specific guidance on document retention in the ordinary course of business. For example, the Securities and Exchange Commission (SEC) and the National Association of Securities Dealers (NASD) have placed IM squarely in their sights as potentially relevant repositories of business information.

Both organizations promulgated rules that place the same 3-year retention requirements on IM as currently exist for e-mail and other forms of written communication. See SEC Rule 17a-4(b)(4); NASD Rule 3110.

In NASD's notice to members, it further indicated that member firms should not use IM platforms that do not support archiving and retrieving of IM conversations. For firms regulated by these bodies, therefore, the decision regarding whether to take active steps to record IM has been made.

(For more on legal considerations of using instant messaging in the financial-services sector, see “IM: Plenty of Benefits, But Risks Too” in the March 2004 edition of e-Commerce Law & Strategy.)

Companies not bound by the SEC or NASD rules have no clear guidance about their IM document-retention obligations. Most companies are guided by the principle that documents should be retained only when there is a business purpose or need, or other statutory or legal requirement. Given IM's purpose ' real-time communications like a phone conversation ' a legitimate case can be made for adopting a retention policy that discourages or prevents IM recording in the ordinary course of business. After all, there is no document created unless additional steps are taken to create a record of the conversation. While tape recordings of conversations may be considered stored information and potentially subject to retention, a corporation is under no affirmative duty to record oral communications that ordinarily would not have been recorded. The same could logically apply to IM.

Ordinarily Done, Or Not?

So the question is whether, in the ordinary course of business, absent some legal requirement, a company must ever record IM. If the answer is yes, then the following argument could be made: Why not require that all phone conversations, or for that matter, all meetings, conference calls and conversations in the hallway, be recorded? After all, IM, like phone calls, are just bits of digital data transmitted over fiber-optic lines from one device to another.

But retention obligations may change when litigation is anticipated. As soon as litigation is reasonably anticipated, and certainly before a document request is served, a party must take reasonable steps to preserve evidence over which it has control and that is reasonably likely to be material to the potential action and the subject of a discovery request. See, eg, Wigington v. CB Richard Ellis, 2003 WL 22439865 (N.D. Ill. Oct. 27, 2003).

Such evidence is usually embodied in what most people think of as documents. The very nature of electronically stored information, however, has changed, and will continue to change, notions of what elements compose a document and what a document comprises. Two questions arise at this point:

• Are IM conversations that were archived in the ordinary course of business documents subject to discovery?
• Do retention obligations regarding IM change once litigation is anticipated?

Federal Rule of Civil Procedure 34 provides for requests for “documents,” including “electronic data compilations.” Today, electronically stored information, such as e-mail, is included in the definition of a document because that is how lawyers and judges are used to thinking of fact discovery. In reality, the term document is an inherently arbitrary concept when applied to electronically stored information. A letter written in Microsoft Word, for example, is really just information that can be understood by Microsoft Word software, which then displays some of the information on a screen or prints it into what we commonly think of as a paper document. Other parts of the data file are not displayed and can be accessed only by viewing the metadata or embedded data. The computer file, however, is itself simply information: information about the letter text; font; page margins and embedded information about changes made to the letter; editors who worked on the letter; and so on.

The fact that all of this information is contained in one file the name of which ends in .doc, however, is purely a design decision by Microsoft engineers. The information could just as easily be divided into multiple files that are simply associated with one another; for example, the text information could be in one .doc file, the formatting information in a .fmt file and the editing information in a .edt file: which file is then the document?

A change to the federal rules that incorporates “electronically stored information” into the Fed. R. Civ. P. 34 definition of the term document, it can be argued, will stand the test of time better than a definition dependent on current notions of what we think of as documents. Such an addition to the federal rules was recently proposed by the Advisory Committee on Federal Rules of Civil Procedure to the Standing Committee on Rules of Practice and Procedure. Ultimately, it is information that is stored in whatever media happen to be in use at the time, which is discoverable in litigation.

Probably Discoverable, If Recorded

Whether IMs are “electronically stored information,” and, therefore, documents potentially discoverable when litigation is filed, depends on numerous factors, such as:

• The IM software program in use and its default settings;
• The options that have been activated by the users or their corporate information-systems personnel, or both, in deploying that system; and, in some instances,
• Whether the individuals have taken steps to record the particular conversation (for example, by checking a dialogue box, or by cutting and pasting the text into a file and saving it there).

If Fed. R. Civ. P. 34 is amended to include “electronically stored information, then the conclusion that stored IM conversations are discoverable is unavoidable. The question, however, is this: When does an IM conversation change from being an ephemeral exchange of information to one that is considered stored and then subject to the same requirements as other electronically stored information?

Although many IM platforms initially did not permit the user to record a conversation, many software developers have incorporated archival and retrieval capabilities in their IM software. It could be feasibly argued that as IM users recognize such capabilities, more of them will begin recording and referring back to IM communications in much the same way that they do with e-mail. It's only a matter of time before attorneys routinely include a request for IM conversations on topics relevant to litigation in their discovery requests. There can be little debate, then, that IM conversations, if recorded, are discoverable in litigation and must be preserved if one has reason to anticipate relevant litigation.

An Obligation to Record?

The question of whether an obligation to start recording potentially relevant IM arises once litigation is anticipated is far less clear. While it is true that with many IM services, it is fairly easy to record a conversation as a text file, instituting a requirement to record IM conversations could be considered akin to requiring all corporate employees to begin recording routine telephone conversations or meetings that might bear on the case in question, merely because that is technically possible, though not done in the ordinary course of business. This is clearly not the law, and never has been.

The key is that information that comes into tangible existence, ie, is stored in some capacity in the ordinary course of business, is subject to discovery. But does the mere ability to store that information justify a new obligation of a party to a case to create and maintain wholly new documents solely for discovery in the litigation?

Although a litigant might be required to compile existing data, he or she generally cannot be compelled to create information that doesn't exist, and never has. Thus, while tape recordings of conversations may be considered stored information subject to preservation if litigation is anticipated, a party is under no affirmative duty to record oral communications that have not otherwise been recorded in the ordinary course of business. The same would seem to apply to IM conversations not recorded by the participants in the conduct of their daily business.

As the very name implies, all software products are inherently flexible and easy to redesign to serve new purposes and be more effective. Just as car companies produce new models every year with updated styles, designs and technologies, software companies update and improve their products regularly to meet consumer demand and keep up with competitors. Undoubtedly as technology advances, courts and litigants will continue to struggle with the definition of document, along with which document-retention obligations in the ordinary course of business and when litigation is anticipated. Just because technology permits us to record and preserve for eternity every spoken or written word doesn't necessarily mean that Big Brother surveillance is good, or needed, for business, or as a matter of law and policy.