Massive Over-Disclosure in the UK May be The Hallmark of a New “Bespoke Disclosure Regime” For Our Digital Age

By Simon Yeung and Johanna Hoyos

In a radical move, Mr Justice Marcus Smith is ushering in a new disclosure option in England by ordering “massive over-disclosure” of documents by the parties in Genius Sports Technologies Ltd v Soft Construct (Malta) Ltd. Essentially, he ordered that the entire pool of documents – minus irrelevant or privileged ones – should be disclosed for the receiving party to search, in order to avoid the “real risk” that important documents would be overlooked and not disclosed.

The case, which involves competition and intellectual property claims, was heard jointly before the Competition Appeal Tribunal of the United Kingdom and the High Court of England and Wales. Justice Smith (Smith J) is President of the former and a Judge in the latter.

In the High Court claim, the parties had been ordered to provide disclosure under the models provided for under CPR Part 31 and Practice Direction 51U[1] but there remained significant issues between them on disclosure and the disclosure models to adopt. Although there had been a two-day case management conference in July, that was not long enough to address the parties’ differences. Justice Smith ordered a second case management conference at the end of the vacation to resolve these differences.

Justice Smith’s primary concern with the parties’ proposals was the exclusion of relevant material from the collected body of documents, which led him to propose an order for the “over-provision of documentation by the party producing the disclosure (the Producing Party) to the party receiving it (the Receiving Party).” The reasons he gave were that: the standard regime would not work or would only work at excessive and disproportionate cost; the process would protect privileged and confidential material, at proportionate cost; and the disclosure process was not underway.

Instead of the traditional disclosure model of collecting documents and filtering them down to locate relevant material to review for disclosure, Justice Smith proposed that the parties exclude irrelevant material and privileged material and disclose the remainder of the corpus of documents. Addressing the claimants’ primary concerns over the cost of over-disclosure, illustrated in Nichia Corporation v. Argos Limited [2007] EWCA Civ 741, Justice Smith recognised that the nature of disclosure had changed.

Given that most documents were electronic, or could be rendered so, they could be easily searched using freely available basic software or more sophisticated disclosure platforms. The volume of documents necessitated a reduction before a more manageable set could be reviewed – but this was where the problem lay. The parties would reduce the volume of documents that had been collected through the use of electronic filters, whether using key words, concept grouping, predictive coding or other artificial intelligence searches, and if the filters did not reduce the volume sufficiently, the filters would be applied more aggressively. Justice Smith recognised that the use of these filters led to large numbers of documents deemed not responsive and therefore not reviewed by lawyers. Although Justice Smith had no objection to the use of filters where there was confidence that they would not discard relevant documents, the judge concluded  this was not the case here (although he did not enunciate his reasoning). The method was therefore fatally flawed.

Ordering massive over-disclosure would address the real risk that important documents would be overlooked and not disclosed. The claimants’ concerns over the “dumping” of large volumes of documents was not relevant, as it was when Nichia was decided in 2007. Rather than eye-ball all the documents, the receiving party could as easily apply its own filters to them to locate relevant material within.

Before ordering “massive over-disclosure,” Justice Smith required the following conditions to be satisfied:

• there is a real risk that the standard process of disclosure would miss relevant documents;
• the process is not oppressive to the parties;
• the risk of inadvertent disclosure is contained (regardless of whatever process of disclosure is adopted, the risk of inadvertent disclosure can only be contained, not eliminated); and
• confidential information is protected.

Justice Smith required that the parties set out both the document sources they would be searching and the date filters they would use to exclude documents, with a direction to err on the side of over-inclusion, and subject to a duty of full and frank disclosure over what would and would not be searched. The parties would then filter out documents which were irrelevant on the Peruvian Guano test,[2] instead of identifying relevant material under the current disclosure models, also erring on the side of over-inclusion.  The parties would then identify and remove privileged material. The balance of the documents would be disclosed, irrespective of the confidentiality of the information in the documents.

To protect the disclosing party’s confidential information, access to the documents would need to be recorded and auditable on the disclosure database used by the receiving party. Those with access to the disclosed material, apart from external counsel and experts subject to their own professional obligations, would be required to sign an undertaking, with a penal notice for non-compliance, promising to comply with CPR 31.22, in effect, imposing a confidentiality ring. Access by the receiving party to documents would be approved by a King’s Counsel retained by the receiving party.

Comment

The judgment introduces a radical disclosure regime that recognises the changes in how documents are created and the AI tools now available to practitioners. Arguably, Justice Smith has turned the tables, shifting the burden of finding relevant material from the disclosing party to the receiving party, using 21^st century tools and applying them to a laborious 19/20^th century task. By doing so, he has redefined what disclosure means – the disclosure of relevant material and reducing the risk of relevant material being excluded – and challenged the status quo which, from the introduction of the Civil Procedure Rules in 1999, has sought to pare back disclosure to avoid disproportionate expense.

Although Justice Smith limited the application of massive over-disclosure to claims where there is a real risk of the standard disclosure process missing important and relevant documents, and where the parties would not be oppressed by the order, parties (and their lawyers) may feel uncomfortable with not knowing what information they are disclosing.

On balance, this new regime would appear to be more beneficial to claimants than defendants, and to smaller organisations rather than to large corporate parties. Multinationals, and their executive teams, may feel more vulnerable to these disclosure orders given the breadth of their businesses. It will be interesting to see how their document retention and litigation strategies adapt.

Written by Simon Yeung and Johanna Hoyos

Edited by Gary J. Malone

[1] The Disclosure Pilot Scheme, now replaced in substantially the same form by PD57AD and no longer a pilot.

[2] The case established a very wide scope for disclosure, including documents relating to the matters in question that are not only evidence on any of the issues, but also may directly or indirectly allow a party to advance their own case or damage the case of their opponent, the “train of enquiry”. The Compagnie Financiere Et Commerciale Du Pacifique v The Peruvian Guano Company (1882) 11 Q.B.D. 55.