English High Court Approves The Use Of Predictive Coding

Author:Ms Shannon Capone Kirk and Tin Nai Anne Cheng
Profession:Ropes & Gray LLP
 
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The English High Court decision of Master Matthews (February 16, 2016) approved the use of predictive coding to satisfy the disclosure requirement under the Civil Procedure Rules (CPR) Part 31. See Pyrrho Investments Ltd v. MWB Property Ltd [2016] EWHC 256 (Ch). This marks the first case where an English court has discussed in detail the use of predictive coding.

The facts of the case are as follows: Pyrrho Investments Limited and MWB Business Exchange Limited brought a breach of shareholder's fiduciary duty cause of action against five defendants. On February 2, 2016, the parties attended a hearing concerning their obligations for electronic disclosure of a large volume of documents on back-up tapes (originally estimated to be more than 17.6 million, but later reduced to 3.1 million by process of electronic de-duplication). 

Under the CPR, parties are obligated to make a reasonable search for disclosable documents. Factors sets forth in CPR 31.7 for determining the reasonableness of a search include: “(a) the number of documents involved; (b) the nature and complexity of the proceedings; (c) the ease and expense of retrieval of any particular document; and (d) the significance of any document which is likely to be located during the search.” Rule 31 is supplemented by two Practice Directions, one of which (Practice Direction 31.B) outlines factors in determining the scope of electronic disclosure. While the Rule and guidelines were useful in determining the search's scope and quality, the court found that neither the CPR nor the Practice Directions answered the question as to how to conduct the search. The court found that while keyword and other automated searching methods may be enough to satisfy the reasonableness standard under Rule 31, parties should apply additional techniques and take other necessary steps as deemed justifiable by the court. 

In its decision, this court cited a U.S. Federal Court case where the magistrate judge described its decision to allow predictive coding asrelatively easy [but noting that it]is not a magic, Staples-easy Button, solution appropriate for all cases. See Da Silva Moore v. Publicis Groupe, 287 F.R.D. 182, 189 (S.D.N.Y., February 24, 2012). The Court also cited another case where an Irish Court endorsed the use of predictive coding. In Irish Bank Resolution Corporation Ltd v. Quinn [2015] IEHC 175, the Irish High Court stated:[t]he evidence establishes, that in discovery of large data sets...

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