On December 1, 2015, barring action by Congress, amendments to the Federal Rules of Civil Procedure, will take effect. A number of these amendments are intended to fine-tune the discovery process, and they may have an impact on ERISA-related discovery. Of particular note are the increased emphasis on proportionality in discovery; additional requirements in objecting to discovery requests; and a significant limitation on sanctions for loss of electronically stored information.


The amendments place increased focus on the requirement that discovery be limited to what is proportional to the needs of the case. This is accomplished by modifying the standard for what is discoverable, found in Rule 26(b)(1). As amended, it will read:

Scope in General. Unless otherwise limited by court order, the scope of discovery is as follows: Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit. Information within this scope of discovery need not be admissible in evidence to be discoverable.

The Advisory Committee Note states that proportionality became part of the discovery rules in 1983, but “may have been softened” by intervening amendments. The amendment aims to reverse that trend: “The present amendment restores the proportionality factors to their original place in defining the scope of discovery. This change reinforces the Rule 26(g) obligation of the parties to consider these factors in making discovery requests, responses, or objections.”

It is not hard to see how this change might impact discovery in ERISA cases, especially in courts where broad discovery related to conflict of interest is the rule. The requirement that any discovery be “proportional to the needs of the case” strongly supports the notion that a court should (perhaps must) consider the weight of evidence in the administrative record before allowing broad conflict-of-interest discovery. If for example, a determination would withstand arbitrary-and-capricious review even if the conflict factor were to be given heavy weight, one would assume that extensive conflict discovery would not be proportional to the needs of the case. Under this reasoning, it could be argued that conflict discovery should be significantly circumscribed except in those cases that are close to equipoise between arbitrary and not arbitrary – where the conflict factor plausibly could play a significant role in the judgment on the merits. This certainly is not a new argument, but the new rule might give some lift to the argument in those circuits that have not previously embraced it.


The new Rule 26(b)(1) also eliminates language that discovery be “reasonably calculated to lead to the discovery of admissible evidence.” The new language reads: “Information within this scope of discovery need not be admissible in evidence to be discoverable.” The Advisory Committee states that this should be interpreted as narrowing the standard for discovery, rather than expanding it: “[t]his change is designed to curtail reliance on the ‘reasonably calculated’ phrase to expand discovery beyond the permitted scope.”

Unfortunately, it may have unintended consequences in ERISA cases. Under the current rule, a party opposing discovery in abuse-of-discretion cases can point to the general rule that evidence is limited to the administrative record, and argue that any discovery is not likely to lead to admissible evidence. Plaintiffs seeking broad discovery may argue that this change should be interpreted as allowing discovery even when it is not reasonably likely that the evidence will be admissible. Defense counsel opposing those arguments will need to advise the court how the Advisory Committee intended the change to be interpreted.

Discovery Responses

A revision to Rule 34(b)(2) adds additional obligations to counsel responding to document requests. Section (b)(2)(B) makes clear that, if an objection is made to a request, counsel must “state with specificity the grounds for objecting to the request, including the reasons.” This change merely incorporates language that already had applied to interrogatory responses under Rule 33.

Perhaps more significant is the new requirement in section (b)(2)(C), which provides: “An objection must state whether any responsive materials are being withheld on the basis of that objection.” The Notes state that, if the responding party objects to a request as overbroad, but considers part of the request to be appropriate, “the objection should state the scope that is not overbroad. Examples would be a statement that the responding party will limit the search to documents or electronically stored information created within a given period of time prior to the events in suit, or to specified sources.”

This rule would preclude a responding party from stating a general objection, and then merely stating that documents will produced “subject to the objection.” Now, the responding party will have to take the additional step of specifying whether it is circumscribing its search, or withholding specific documents, pursuant to the objections. To be sure, this was good practice before the amendments, and most conscientious counsel already make clear what is being produced or withheld.

A potential problem is the extent to which this new obligation encourages plaintiffs to frame their requests more broadly than before, and place on defendants the obligation to specify exactly what they are and are not producing. Consider, for example, a request for “all entries in all databases concerning plaintiff.” Is the defendant required to identify all databases that might have entries concerning the plaintiff, and then specify which databases it is, and is not, searching? It may be that the best response to such an overbroad request will be to object and not offer to produce some responsive documents unless and until the plaintiff narrows the request.

Maintenance and Destruction of ESI

The amendment to Rule 37(e) is good news, especially for organizations, like plan administrators, with large amounts of electronically stored information. Under existing Rule 37(e), a court had discretion to impose sanctions in “extraordinary circumstances” for “failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system.” Unfortunately, the circuits differed significantly in determining what circumstances were “extraordinary.” Some approved sanctions for negligent destruction, while others required bad faith. The amendment imposes a uniform standard, and provides that the most severe sanctions – ordering an adverse inference, dismissing the action or entering a default judgment – can be considered “only upon finding that the party acted with the intent to deprive another party of the information’s use in the litigation[.]” The intent must be specific to the particular litigation at issue, and cannot be a general intent to dispose of ESI.

In other circumstances, the amendments require the court to consider several factors before potentially ordering less severe “measures” to respond to the loss of ESI.

First, the court must determine that the ESI “should have been preserved in the anticipation or conduct of litigation[.]” This requires a finding that a duty to preserve the particular information for the particular litigation arose, and that the party violated that duty. The Advisory Committee emphasizes that the duty to preserve must relate to the specific litigation; a duty to maintain information pursuant to a statute, or regulation, or order in some other litigation would not necessarily qualify.

Second, the court must determine that the ESI was “lost because a party failed to take reasonable steps to preserve it[.]” This factor invites a party to explain its data retention policies, to demonstrate that they are reasonable and comprehensive. A court cannot find a violation merely because data is destroyed. The Advisory Committee Notes state that proportionality is important here; courts should not automatically fault parties for choosing not to implement the most comprehensive, and most expensive, ESI retention practices.

Third, the court must determine that the lost ESI “cannot be restored or replaced through additional discovery[.]” Thus, a court ordinarily should require a party to seek alternate discovery, or discovery from other entities, before seeking “measures” under Rule 37(e). Similarly, the party that lost the ESI might be ordered to attempt to restore it, but, only to the extent that the effort and cost is proportional to the needs of the case and the importance of the information at issue.

Fourth, the court must find “prejudice to another party from loss of the information[.]” This requires evaluation of the importance of the information to the litigation. It is noteworthy that the rule does not place the burden of proving or disproving prejudice on either party, but allows the court to determine how best to evaluate prejudice on a case-by-case basis.

Only after all of these elements are established may the court “order measures no greater than necessary to cure the prejudice[.]” The court is not obligated to order any measures, even if all elements are established. The measures available would include anything the court considers appropriate, short of the sanctions authorized by section (e)(2) for willful destruction, and could include orders precluding certain evidence, admitting evidence or argument regarding the destruction of ESI, or giving specific jury instructions (short of an adverse inference).

The amendment is a welcome recognition that everybody has ESI, on many platforms – including smartphones, laptops, flash keys, cloud storage, back-up devices, etc. – and that it is unreasonable to expect people (and especially large organizations) to have perfect plans and procedures to preserve it all.

Certainly, organizations should not take this amendment as license to immediately dial back data retention practices. There are many reasons to manage the retention of data that have nothing to do with litigation. But the amendment should serve to eliminate, or at least reduce, the anxiety resulting from a fear that inadvertent oversights could have disastrous consequences in litigation.

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Photo of Patrick Begos Patrick Begos

Mr. Begos has nearly 30 years of commercial and insurance litigation, arbitration, mediation and negotiation experience, representing companies and individuals in a wide array of industries. He has a national reputation in handling litigation under the Employee Retirement Income Security Act (ERISA) and…

Mr. Begos has nearly 30 years of commercial and insurance litigation, arbitration, mediation and negotiation experience, representing companies and individuals in a wide array of industries. He has a national reputation in handling litigation under the Employee Retirement Income Security Act (ERISA) and, in particular, denial of group benefits claims. Mr. Begos has litigated hundreds of ERISA cases and has been involved in shaping the development of ERISA law across the country. He is a regular speaker at ERISA and insurance conferences around the country and has written extensively for various nationwide publications. Read his full rc.com bio here.