A federal judge has sanctioned New York based Cleary Gottlieb for discovery abuse. You can read the opinion here. Cleary’s bad day should serve as a reminder to all litigators – advising a witness to not testify when he or she has information relevant to a pending lawsuit can land you in a bad place.

The New York Law Journal reports that former Sullivan & Cromwell asociate Aaron Charnley has apparently destroyed a personal computer hard drive that may have contained information relevant to the litigation between Charnely and the firm. Charnely has been given until February 14th to explain his actions to the Court. One word comes to mind – spoliation. If it is found that Charnely intentionally destroyed evidence, it is very possible, if not liklely, that it would mean the end not only of his case, but of his legal career.

Many, if not most, lawyers play cutesie when responding to discovery requests, and will readily resort to tortured readings and ridiculous wordplay semantics to avoid turning over harmful (or even not so harmful) material. This is, in my view, shameful and one of the more disgraceful elements of litigation practice. This story, however, about the efforts of plaintiffs’ counsel in a case against Microsoft to avoid turning over the Microsoft documents reviewed by the plaintiffs’ economic experts, is beyond shameful. (Hat tip to Howard Bashman, via Beldar, for the story). Read more below the fold.

Microsoft claims to have asked for documents that were “reviewed” by the plaintiffs’ experts so that they (Microsoft’s counsel) could prepare for the experts anticipated depositon testimony. The plaintiffs’ counsel reportedly read the request as seeking documents that were “re-viewed” by the experts, thus obligating them to produce only documents that the experts had looked at more than once. If this account is correct, and if the Microsoft lawyer has properly characterized the response offered by plaintiffs’ counsel, the response staryes well beyond typical, but regrettable, litigation nonsense. It is beyond stupid. It is pure mendacity, and exhibits such complete contempt for the court and for the litigation process that Microsoft’s requested sanction – the exclusion of the 3 experts – should be granted and, indeed, is not strong enough, in my opinion. Deliberately reading a common English word “review” that has a plain and commonly understood meaning ion the litigation context in such a silly, dishonest fashion brings disrepute not only on the plaintiffs’ counsel (which is well deserved), but upon the legal system as a whole,as well as those of us who practice trial law. The court should impose the strongest possible sanction, and report these lawyers to the appropriate authorities for possible disciplinary action.

The New York Times reports today that the NASD has filed a complaint against Morgan Stanley, asserting that the bank “routinely fail[ed] to provide e-mail messages to aggrieved customers who had filed arbitration cases against the firm” over a 3 1/2 year period, and that Morgan Stanley further made “false claims that millions of e-mail messages in its possession had been lost in the Sept. 11 attack on the World Trade Center.” Perhaps most damning, the regulators have alleged that the firm regularly destroyed millions of emails. Read more below the fold. Without expressing an opinion on the merits of the NASD allegations – I am firmly agnostic on that point – Morgan Stanley’s history of problems in this area lends at least a whiff of credence to the NASD claims. Many probably remember the firm’s high profile dust up with Ronald Perleman, in which Morgan was subject to fairly severe sanctions as a consequence of its failure to timely turn over electronic records that it had earlier claimed had been destroyed. In light of the growing importance of electronic discovery, and especially in view of the significant changes to the Federal Rules of Civil Procedure (about which I will have more to say in a future post), there is simply no excuse for any entity, or individual, for that matter, who is involved in litigation to not have a form grasp on what electronic records are available, and for not properly preserving those records. If you think you are likely to become embroiled in litigation, consult your counsel post haste about what your obligations are in this area. In fact, I strongly recommend that you do so even before there is a threat of litigation. When, or if, that lawsuit ultimately comes, you’ll be happy that you did.