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New discovery and complex case management rules started July 1. What do they mean?

The Proportionality Principle

RulesBy Michael Goodwin

As most civil litigators in Minnesota are aware, a number of significant rule amendments went into effect on July 1, including new rules designed to change aspects of discovery, non-dispositive motion practice and complex case management.

Many of the rule changes were based on recommendations by the Minnesota Supreme Court Civil Justice Reform Task Force, which published a report in December 2011. The task force considered its most important recommendation to be the new rule requiring proportionality in all aspects of case management (especially discovery). In fact, proportionality was considered so important that it was included in Rule 1 of the Minnesota Rules of Civil Procedure, which now reads in part:

“It is the responsibility of the court and the parties to examine each civil action to assure that the process and the costs are proportionate to the amount in controversy and the complexity and importance of the issues. The factors to be considered by the court in making a proportionality assessment include, without limitation: needs of the case, amount in controversy, parties’ resources, and complexity and importance of the issues at stake in the litigation.”

The proportionality requirement of new Rule 1 applies to “virtually any issue that affects the managerial decisions judges and parties make in handling the case.”

The task force was particularly concerned about the costs and burdens associated with discovery, and a number of amendments were made to the discovery rules to advance the proportionality principle. New Rule 26.02(b) requires that a party seeking an order compelling discovery make a showing proportionality. Rules designed to impose limits on discovery were already part of Rule 26.02(b), which mirrored the federal rule.  According to the Civil Justice Reform Task Force, these considerations had not been effective in reigning in discovery:

“In practice, [Rule 26.02(b)] discovery limits have rarely been enforced, however; and the expansion of discovery and the increasing expense of discovery literally threaten the civil justice system.”

By making the proportionality concept more explicit in the rules, the task force intended to “create a presumption in favor of narrower discovery and require consideration of proportionality in all discovery matters, limiting discovery to the reasonable needs of the case.” Proposed changes to the federal rules also include a proportionality limitation on the scope of discovery.

While the express proportionality requirement is new and applies only in Minnesota state court, a few recent cases from the federal courts demonstrate how to make detailed and persuasive proportionality arguments, especially as related to electronically stored information. In one recent case from the Northern District of Illinois, a party largely succeeded in limiting certain discovery by demonstrating the difficulty and expense of accessing the requested information, as well as the likelihood that the discovery requests duplicated discovery that had already been produced.  The defense specifically articulated how the requested data was stored and had specific dollar estimates as to the costs of recovery and production. A Colorado district court, on the other hand, rejected several “unduly burdensome” objections because the objections lacked factual support; the defendants failed to provide “any specific information indicating how the [the defendants] store electronic information, the number of back-up or archival systems that would have to be searched in the course of responding to [plaintiff’s requests], or Defendants’ capability to retrieve information stored in those back-up or archival systems.” As these cases demonstrate, building a record for a proportionality argument often requires detailed testimony from individuals with knowledge of how the requested information is stored and how it could be accessed. Of course, under Rule 1, this information will have to be viewed in the context of the amount in controversy, the parties’ resources and the complexity of the issues, among other factors.

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