eDiscovery - In The News


The Texas Supreme Court sets a framework for requesting access to Electronically Stored Information (ESI) such as tracked changes and comments in Microsoft Word documents, notes in PowerPoint, and other dynamic information.

By Robert K. Wise & Kennon L. Wooten, authors of Texas Discovery: A Guide to Taking and Resisting Discovery Under the Texas Rules of Civil Procedure, a comprehensive guide to the Texas discovery practice.

The Texas Supreme Court’s May 26, 2017 opinion in In Re State Farm Lloyds, Nos. 15-0903 and 15-0905, is the Court’s second foray into the rules regarding electronic discovery. In re Weekly Homes, L.P., 295 S.W. 309 (Tex. 2009) (orig. proceeding), was its first and delineated the parameters for assessing a request for direct access to electronically-stored information (ESI).

Is Access to Metadata Required?

In State Farm Lloyds, State Farm Lloyds was sued by its insured homeowners for underpaying hail-damage claims. The homeowners sought, and the trial court ordered, ESI to be produced in its native or “near-native” form rather than in static-image forms (e.g., PDF, TIFF, and JPEG) into which State Farm converted claims-related ESI in the ordinary course of business. The homeowners argued that production of ESI in the requested form was needed to obtain metadata that tracked changes and comments in Microsoft- Word documents, speaker notes in presentations, and animations or other dynamic information that was unavailable in static-image forms.

State Farm Lloyds objected to producing ESI in the requested form because (1) its ordinary business practice was to upload claims information in static, read-only forms, which stripped metadata from the uploaded files, and (2) native or “near-native” production would require development of a new process involving the review of the upstream data sources to determine whether native files exist and, if so, engineering an extraction process. After the trial court overruled State Farm Lloyds’ objection and ordered it to produce ESI in the requested form, State Farms Lloyds sought mandamus relief. The intermediate appellate court denied mandamus relief. So did the Texas Supreme Court, but without prejudice, to allow the trial court to reconsider its decision in light of the Court’s opinion and guidance.

“Neither Party May Dictate the Form of Electric Discovery”

State Farm Lloyds contains three core holdings. Initially, it holds that, under the Texas discovery rules, “neither party may dictate the form of electric discovery.”

Next, the case holds that, if the producing party objects to the requested form for ESI’s production because unreasonable efforts are required to produce it in that form and a “reasonably usable” form is readily available, the trial court must conduct a case-specific proportionality analysis balancing the following factors: (1) the likely benefit of producing the ESI in the requested form, including the “cumulative effects” of the trial court’s order; (2) the case’s specific needs; (3) the amount in controversy; (4) the parties’ financial and technological resources; (5) the importance of the issues at stake in the litigation; (6) the importance of the proposed discovery in resolving the litigation; and (7) any other articulable factor bearing on proportionality.
Finally, the case holds that metadata’s relevance in litigation “must be obvious or at least linked, more or less concretely, to a claim or defense[,]” noting that “metadata may be necessary to the litigation when the who, what, where, when and why ESI was generated is an actual issue in the case, not merely a helpful or theoretical issue.”

The decision also is important for at least two other reasons. First, it aligns electric-discovery practice under the Texas discovery rules with those under the federal discovery rules. Second, the Court, quoting Weekly Homes, noted that the Texas discovery rules in general “are not inconsistent with the federal rules or the case law interpreting them” even though they may not “mirror the federal language.” Accordingly, in e-discovery disputes in Texas state courts, practitioners can, and should, rely on cases interpreting the pertinent federal rules as guidance.

Robert K. Wise & Kennon L. Wooten are authors of Texas Discovery: A Guide to Taking and Resisting Discovery Under the Texas Rules of Civil Procedure, a comprehensive guide to the Texas discovery practice. Robert K. Wise is a founding member of Lillard Wise Szygenda PLLC in Dallas. Kennon Wooton is a partner at Scott Douglass & McConnico LLP in Austin.

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New Title: Practical Guide to Mergers, Acquisitions and Business Sales, 2nd Edition


Practical Guide to Mergers, Acquisitions and Business Sales, 2nd Edition

by: Joseph B. Darby III
ISBN: 9781945424519

Print: $279
eBook: $279
Print + eBook: $348


A must-have for financial advisors, lawyers, CPAs, and other professionals advising clients, Practical Guide to Mergers, Acquisitions and Business Sales, Second Edition, is an easy-to-understand guide which explains the tax consequences of buying or selling a business and the art of successfully closing business transactions.

Drawing on a vast 30 years of experience, author Joseph B. Darby III, J.D. – a business and transactional tax law expert – incorporates insightful, real-life examples throughout his coverage of the buying and selling of all forms of business entities, including Sole Proprietorships; Partnerships; S Corporations; C Corporations; Limited Liability Companies; Professional Corporations; and more.

Broad in scope, with numerous citations to the IRS Code, rulings, and regulations, this resource covers:

  • How tax aspects of the sale of a business can influence negotiations, both in a positive and negative way
  • The areas for “give and take” in any negotiation of tax liability for the sale of a business
  • Strategies related to Installment Sales, Contingent Payments, Goodwill, Consulting Agreements with prior owners, and other methods that can be introduced into a business acquisition
  • Common pitfalls in the negotiation process, including the overlooking of critical tax issues

Practical Guide to Mergers, Acquisitions and Business Sales, Second Edition, is the authoritative but concise and easy-to-understand resource you can rely on.

Prepublication Offer! Take 20% off using "Coupon Code," LJP20.  Promotion valid through December 31, 2017. Order here.


Drafting Commercial Leases in 2017: Growing Complexity


Negotiating and Drafting Office Leases - In the News

“Learning concepts and dangers from the litigation of such transactional documents and from real malpractice cases is professionally essential...”

Drafting Commercial Leases in 2017: Growing Complexity
By James Busey Wood

The fundamental and critical building blocks of value for most commercial real estate are the property commercial leases. Rarely are investment properties or owner developed and operated properties valued for transfer, investment or financing on their brick and mortar components. So it is not a surprise that designing lease forms, negotiating and implementing leasing programs, and maintaining vigilant compliance monitoring are all essential for investors in real estate. It follows that such foundational concepts are equally essential and critical for those businesses occupying leased commercial space. Just as income from leases is sophisticated and multidimensional, so too is the understanding of the full and complete occupancy costs and risks that are attendant to a tenant's lease agreement.

Commercial leases have grown over the last four decades from small demising contracts to over 300 pages of owner cost, maintenance, compliance, and risk transfer and have become the obligations of the tenant occupant. Not all of these transfers of costs and obligations are apparent, but when they are understood, they can be cost/price analyzed to evaluate the true long term occupancy costs of space. These costs, obligations, and risk analytics become apparent when viewed from working knowledge and transactional experience. Such knowledge and transactional experience can be obtained over time by practicing in the area, as well as by reading and obtaining commentary and analytics on real transactional documents and forms that have been drafted and tested by experts in the commercial real estate field. Gaining access to such transactions and forms as well as creator tips and commentary is a rare gift. However, learning concepts and dangers from the litigation of such transactional documents and from real malpractice cases is professionally essential.

The Killer Lease: Theft by Lease
Long term commercial leases are replete with costly and risky surprises within the text, as well as important items omitted from the text. Commercial leases have evolved in the United States and principally in New York City for over 400 years, beginning in the Dutch Colony days, and have been nurtured in a legal and business environment of caveat emptor—they have been completely unregulated or refereed. The result has involved some of the most creative stripping of profits known to man, as a result of the language used. Layers of definitions and mixed professional disciplines, together with a mismatch of standards of cash flows, tax treatments, and accounting terminology to make lease language sound nice and feel good, actually rip the financial heart out of tenants. It is truly the extreme sport of multi-dimensional theft by lease.

Lease forms over the last forty years have not gotten shorter or fairer in the slightest bit. Value, costs, and risk can be found in the small print and it is truly the case that one of the hardest things for the human brain to identify is "what is missing in the text or formulae.” However, this work will result in the savings of multiples of its cost, as it will guide you through the process of the evaluation and accommodation of the difficult task of living with commercial leases.

For almost twenty-five years, Negotiating and Drafting Office Leases, authored by John Busey Wood and Alan M. Di Sciullo, has provided the investment, operating, legal, accounting, and brokerage communities in depth research, form analytics and transactional evaluations, as well as current topics and malpractice awareness. In 1994, author James Busey Wood was named "the father of the modern Killer Form of Lease" by the Wall Street Journal.

Click to learn more about Negotiating and Drafting Office Leases. Register and download Chapter 1 for free.

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Law Journal Press Announces: Online Practice Area Libraries


Flexibility. Accessibility. Capability.

Law Journal Press proudly presents our high-quality legal reference content from expert author practitioners in the form of online libraries. Not only do we offer online libraries covering key practice areas, but we also offer state-specific libraries (CA, CT, FL, GA, NJ, NY, PA, and TX) across practice areas to further meet your specific needs.

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The Law Journal Press Practice Area Libraries Include:

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Whistleblower Law - In the News


Lisa J. Banks
Katz, Marshall & Banks, LLP
Co-Author, Whistleblower Law: A Practitioner's Guide

The Defend Trade Secrets Act (DTSA), signed into law by President Obama in May 2016, is one of the most significant developments in whistleblower law in some time. Among other provisions, the DTSA provides immunity from liability for disclosing trade secrets to a government official or attorney for the purpose of reporting or investigating suspected illegal activity, as well as disclosures made in legal proceedings, so long as the disclosure is under seal. This protection extends to retaliation lawsuits.

In many ways, the Act’s whistleblower protections are modest. For instance, the DTSA immunizes a whistleblower who uses trade secret information “in the court proceeding” after the whistleblower “files a lawsuit [under seal] for retaliation.” But most federal whistleblower statutes require a whistleblower to first file an administrative complaint with the Department of Labor, and it is unclear whether disclosures made in such complaints would be immunized or even could be sealed. The Act may also encourage whistleblowers to file under seal more often than necessary out of concern that a court might determine that some piece of evidence underlying the complaint constituted a trade secret. Despite its potentially narrow scope, the DTSA undoubtedly provides significant protections not previously available for whistleblowers.

The DTSA is part of a broader trend in whistleblower law to deter companies from stifling employees’ ability to alert appropriate authorities on potentially unlawful activity. This trend was reflected in the SEC’s recent spate of enforcement actions – seven since August 2016 – against companies that used employment agreements to stifle current and former employees’ ability to report wrongdoing to the government. Similarly, OSHA announced in August 2016 that it would not approve of settlement agreements between whistleblowers and their employers that included confidentiality provisions that prohibited the whistleblower from providing information to the government. Elsewhere, the Department of Defense, NASA, and the General Services Administration issued a final rule in January 2017 prohibiting federal contractors from using agreements that restrict “the lawful reporting of waste, fraud, or abuse to a designated government representative authorized to receive such a report.”

These statutory and administrative efforts to preserve the ability of whistleblowers to report wrongdoing to the government, regardless of contractual provisions to the contrary, represent an important development in whistleblower law. While attorneys specializing in this area of law will be watching carefully to see whether these efforts continue under the new administration, protecting whistleblowers has long been a bipartisan issue. Powerful senators ranging from Charles Grassley (R-IA) to Patrick Leahy (D-VT), among many others, having expended considerable effort over the years to protect those who speak truth to power. The hope among whistleblower advocates is that this issue will continue to enjoy support from both sides of the aisle in the years to come.

Click to learn more about Whistleblower Law: A Practitioner’s Guide. Register and download Chapter 1 for free.

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White Collar Crime: Business and Regulatory Offenses
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Education Law

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Welcome to the new LJP Alert!


By adopting an online format, we move from our twice-a-year print newsletter to deliver to you a more user-friendly and rich experience. We’ll now bring you more product information and updates, more often, within a searchable environment, and with archives for your convenience. We are still listening!

Popular Regular Alert Features

We’ll continue to post popular features such as: new product announcements, technical updates, user tutorials, scheduling/pricing, current promotions, and surveys. We will now also include downloads and videos to make this information even more interactive and useful to you.

New Feature: In the News!

We introduce “In the News,” a new feature born from the Law.com news network, with commentary by our authors. This feature links the important practical information you will find in our latest product releases with what is going on in our industry.

This month Caroline Young, author of Legal Research and Law Library Management, reports on cybersecurity and the expanding role of the law librarian as data gatekeeper. The latest update of the popular treatise contains an analysis of best practices for law libraries, an outline of the role of law librarians in bolstering cybersecurity, and a cybersecurity preparedness checklist.

Coming soon, Lisa J. Banks (Katz, Marshall & Banks, LLP), author of Whistleblower Law: A Practitioner’s Guide, will give her perspective on key issues likely to be impacted by the new Administration.

Be sure to subscribe to receive notices when new articles are posted.

Thank you for your business, and we look forward to hearing your feedback in our ongoing quest to improve your LJP Online experience.

Linda Manahan
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ALM Practical Insights

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Accounting and Financial Planning for Law Firms
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Whistleblower Law: A Practitioner's Guide


Whistleblower Law: A Practitioner's Guide
by: Lisa J. Banks: Katz, Marshall & Banks, LLP and
Jason C. Schwartz: Gibson, Dunn & Crutcher LLP

Print + Online + eBook: $512
eBook + Online: $468

As a federal government watchdog, I often work with corporate and government insiders with first-hand knowledge of matters vital to the public interest. Whistleblowers are the first and best line of defense against waste, corruption, and other misconduct by the government and its contractors. This book is simply without equal as a comprehensive, non-biased guide to the current landscape of federal and state whistleblower law." —Danielle Brian, Executive Director Project on Government Oversight

In this volume, you will access an in-depth, balanced overview of whistleblower law and the many issues facing practitioners today:

  • Major legislation, including the False Claims Act of 1863, the Sarbanes Oxley Act of 2002, and The Dodd-Frank Act
  • Whistleblower protections in the areas of consumer and investor affairs, nuclear and environmental law, and transportation
  • Survey of state laws and the District of Columbia
  • Whistleblower incentive programs, including those from the SEC, CFTC, and IRS
  • Unique challenges faced by whistleblowing attorneys and compliance officers
  • Employer considerations, including preventative measures, investigations, disclosures, privilege, and settlements.

Not a subscriber? Take 15% off a new subscription to any of these 3 titles using promo code 510467. Promotion valid through December 31, 2017.