Originally published April 1, 2005
This article explores some of the special issues that may arise when litigation in the United States requires a party to produce electronic documents located in India. Indian corporations and Indian subsidiaries to U.S. corporations may be unfamiliar with how the discovery process operates in the United States, and the special problems associated with electronic discovery present further challenges. First, this paper discusses Indian law with respect to discovery procedures, attorney-client privilege, and privacy requirements. The second section discusses the challenges that arise for U.S. litigators as a result of Indian law in these areas, and strategies for overcoming these challenges.
I. LAWS GOVERNING DISCOVERY IN THE UNITED STATES AND INDIA
A. Discovery Procedures
Discovery procedures in India closely mirror those in the United Kingdom, and discovery does not hold the same strategic importance for litigation that it does in the United States. Indian discovery rules are governed by the Order XI of the Code of Civil Procedure of 1908. Under that Code, "[a]ny party may. . . apply to the Court for an order directing any other party to any suit to make discovery on oath of the documents which are or have been in his possession or power, relating to any matter in question therein." Order XI, para. 12. The Court then holds a hearing on the application and may order the discovery, dismiss the application if the Court determines that the discovery is not necessary or is untimely, or the court may limit the discovery to certain classes of documents. Id. In addition, the Court itself may order production of documents "as the Court shall think right." Id. at para. 14. Indian civil procedure rules also allow the parties to a suit to give notice, at any time during the suit, of an inspection of any document referenced in another party’s pleadings or affidavits. Id. at para. 15.
Although the Civil Procedure Code does not specifically contemplate or address the discovery of electronic documents, other areas of Indian law have been updated to address electronic documents in court proceedings. The Information Technology Act of 2000 ("the I.T. Act"), an expansive act that set forth laws relating to information technology in a broad array of areas, made amendments to the Indian Evidence Act of 1872 ("the Evidence Act"), and set forth some specific guidelines for treating electronic documents as evidence. The I.T. Act changed the definition of "evidence" within the Evidence Act from "all documents produced for the inspection of the Court" to "all documents including electronic records produced for the inspection of the Court." Information Technology Act of 2000, Second Schedule 1(a), amending the Indian Evidence Act of 1872 sect. 3. The I.T. Act’s evidence provisions also include methods for authenticating digital signatures and procedures for the admissibility of electronic records.1 See Information Technology Act of 2000, Second Schedule.
B. Attorney-Client Privilege – Limiting the Scope of Discoverable Documents
The scope of attorney-client privilege affects what electronic documents parties may request during discovery. Under U.S. law, confidential communications conducted with a lawyer, even an in-house lawyer, are protected by attorney-client privilege. See, e.g., United States v. Rowe, 96 F.3d 1294, 1296 (9th Cir. 1996) (noting long tradition under U.S. law of treating in-house counsel and outside counsel similarly, so that communications between a corporation and its in-house counsel is accorded the same attorney-client privilege as similar communications between a corporation and its outside lawyers). This means that, if an email containing advice from an attorney is stored on a company’s computer system, that email is generally protected by attorney-client privilege and is not subject to discovery.
The law of attorney-client privilege in India has some similarities to attorney-client privilege in the United States. Under the Indian Evidence Act of 1872, communications between an attorney acting in his professional capacity and a client are protected from disclosure unless the communication is made for an illegal purpose or is evidence of an ongoing crime. Indian Evidence Act of 1872, sec. 126. Unlike the United States, however, communications with in-house attorneys are not protected by privilege. Under the regulations of the Bar Council of India, "An advocate shall not be a full-time salaried employee of any person, government, firm, corporation or concern, so long as he continues to practise, and shall, on taking up any such employment, intimate the fact to the Bar Council on whose roll his name appears and shall thereupon cease to practise as an advocate so long as he continues in such employment." Rules of the Bar Council of India, Part VI, Section VII. Because of this difference, the scope of electronic documents that will be protected by privilege differs in India.
C. Privacy Requirements
One issue that can cause difficulties for discovery in the United States of documents located in other countries is the prevalence of foreign privacy laws. In Europe, for example, European privacy laws prohibit the transfer of personal data to a country or territory outside the European economic area unless that country or territory ensures an "adequate level of protection" for individuals in the processing of personal data. European Directive 95/46/EC, art. 25. The United States is not currently accepted by the European Commission as providing an adequate level of protection. As a result, under these rules, data cannot be transmitted to the United States if it constitutes personal data, unless a recognized exception to this rule applies, or another means is used to achieve adequacy of protection of the data. Although India mirrors British law in other ways, it currently has no data protection law or privacy directive similar to the European Directive. However, the I.T. Act of 2000 instituted some criminal penalties for computer hacking and illegal access of personal data maintained in electronic format, so there is evidence that the Indian government may address the issue of privacy in the near future. Were this to become true, and depending on the action the Indian government takes, electronic discovery from India could face difficulties as seen in the discovery of documents in Europe.
D. Recognized International Processes for Serving Discovery Requests
Electronic discovery in India is different from discovery in other foreign countries because India is not a signatory to the Hague Convention of March 18, 1970 on the Taking of Evidence Abroad in Civil or Commercial Matters (the "Hague Convention"). That Convention provides rules that member states must follow in obtaining evidence for use in proceedings. Under the Convention, a party requesting discovery from a member state must provide a letter of request addressed by the court in the United States requesting discovery to a central authority in the State from which the party is requesting discovery. The party requesting discovery must then comply with the discovery rules applicable in the State in which it is requesting documents or other discovery. Diplomatic officers appointed by the requesting State then gather the evidence requested, but those diplomatic officers must also follow the rules of civil procedure in the State, and lack the power to compel the production of documents. Because India is not a signatory to this Convention, parties requesting discovery in India need not follow this laborious (and frequently lengthy) process to request materials, which may be beneficial given that foreign companies may rely on the strictures of the Hague Convention to avoid discovery. However, on the other hand, because India is not a signatory, parties may not rely on diplomatic officers to serve discovery requests, making the process potentially more difficult.2
II. CHALLENGES AND STRATEGIES FOR ELECTRONIC DISCOVERY IN INDIA
Despite the increasing uniformity of international business and, to a lesser extent, the increasing uniformity of international litigation, attorneys working with Indian corporate clients in complying with discovery requests from the United States may still experience a disconnect between what their clients expect the discovery process to entail and what it will actually involve. Like in other countries, discovery does not play the significant role in Indian litigation that it does in litigation in the United States, so Indian clients may be unprepared for the scope and work required for compliance with U.S. discovery requests, particularly in large-scale litigation. In addition, continuing language and technological barriers may present difficulties in carrying out document review processes that discovery compliance in U.S. litigation has come to require, although India’s technological savvy is reducing these barriers. This section discusses some of the problems attorneys face in helping Indian clients respond to U.S. discovery requests and explores some strategies for minimizing them.
A. Foreign Language Data
Although technology is continuously becoming more advanced, and English is the common language for even internal business communications in India, language barriers can be a problem for U.S. discovery compliance. The legal team reviewing documents for relevance must include reviewers who are fluent in languages other than English, and search tools must be able
B. Different Conceptions of Backup Tapes
While Indian discovery processes may require the production of backup tapes, the production of backup tapes for U.S. litigation purposes may be new for Indian companies. In U.S. litigation, discovery disputes over the production of backup tapes are common, and courts routinely require the production of, or at least a search for responsive materials within, backup tapes. See, e.g., Zubulake v. U.B.S. Warburg, 217 F.R.D. 309, 319-20 & n.61 (S.D. N.Y. 2003) (discussing cost-shifting factors for production of backup tapes); Xpedior Credit Trust v. Credit Suisse First Boston, No. 02 Civ. 9149, 2003 WL 22283835, at *4-6 (S.D. N.Y. Oct. 2, 2003) (requiring production of backup tapes without cost-shifting). Like their European counterparts, many Indian companies that use backup tapes think of these tapes as primarily for disaster recovery and not for litigation purposes. Some Indian companies likely never planned on freezing the contents of backup tapes, or retaining them for longer than their policies on retention of materials, so orders requiring preservation, or orders to produce, may come as a shock and may pose substantial technical problems.
C. Unfamiliarity with Large-Scale Discovery
Despite the increasing frequency of Indian corporate involvement in U.S. litigation, many Indian companies are unprepared for the large-scale nature of U.S. litigation. This is in large part because of the limited nature of most Indian discovery. Large-scale litigation of the type increasingly common in the United States is still a rarity in India, so the kinds of large-scale document production that litigation has come to require in the United States may be a challenge to even the most international of Indian companies. Corporate culture in many Indian companies may also be different – many executives, for instance, may find it extremely invasive for an attorney to review their personal correspondence or files and to produce those documents to the other party in U.S. litigation. For this reason, U.S. attorneys advising Indian companies on U.S. discovery requirements should be prepared to explain in a clear way what U.S. courts require and work with their clients to meet these requirements in an efficient way.
D. Data at IT Service Providers
Given the rapid growth in recent years of Indian IT service providers which manage data for U.S. corporations, it seems likely that over time these Indian IT service providers will become targets of U.S. discovery requests. The law governing such requests, and the respective obligations of the companies and the Indian IT service providers, is undeveloped in the U.S. However, it would be prudent for U.S. companies and their Indian IT service providers to plan in their contractual arrangements for the need to meet U.S. discovery obligations. Among other things, provisions governing objections to discovery requests and allocating the costs of compliance could be valuable.
1 The authentication of electronic documents has been a recent issue in India. In some recent cases, courts have refused to admit e-mails as evidence, citing concerns with fraud and the authentication of the e-mails. See D. Murali, "Win some, lose some," The Hindu Business Line (Aug. 9, 2004), available online athttp://www.thehindubusinessline.com/ew/2004/08/09/stories/2004080900230400.htm (discussing recent Indian contract cases in which the authenticity of e-mail communications was at issue).
2 For this reason, U.S. courts have dismissed some litigation involving Indian parties on forum non conveniens ground, since Indian parties cannot be compelled to participate in the litigation. See, e.g., Ramakrishna v. Besser Co., 172 F. Supp. 2d 926 (E.D. Mich. 2001) (dismissing case involving Indian joint venture, noting that India is not a signatory to the Hague Evidence Convention, so that letters of request were not available and "only India can provide the required compulsory process" for Indian witnesses).to handle searches in other languages, including languages that use different character sets than English.
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