Lawson v. Spirit AeroSystems and Managing the Costs of Discovery

As we continue to make greater and greater leaps in technological capability, we discover new hazards that have to be managed. In the case of Lawson v. Spirit AeroSystems, the plaintiff found that out the hard way and wound up paying for his mistake. Absorbing the lessons of this decision will be crucial for parties to litigation as well as for service providers in the ediscovery space.

The Facts about Lawson v. Spirit AeroSystems

The Lawson v. Spirit AeroSystems case began as a dispute over retirement payments. Larry Lawson, the former CEO of Spirit AeroSystems, claimed that the company unlawfully stopped payment of his retirement savings. Spirit AeroSystems argued that Lawson had breached the non-compete agreement he signed upon his departure in 2016, which barred him from working for any company that competed with Spirit for two years. They claimed that Lawson’s consulting work for two firms in relation to control of Arconic, Inc., whom Spirit contends is a competitor, violated this agreement. 

Massive Amount of Data Caused Issues during Discovery

As the case went on, a massive amount of electronically stored information (ESI) was requested through discovery by the plaintiff. Traditional methods such as keyword searches bore little fruit, producing few documents with relevance to the case. As a result of these repetitive and largely unproductive searches, Lawson was warned by the court to narrow the scope of his discovery requests, and that failure to do so may result in cost-shifting, a little-used provision of Federal Rules of Civil Procedure 26 that allows the court to shift the cost of burdensome discovery requests to the plaintiff.

But Lawson pushed on, requesting that a technology-assisted review be performed on a set of 322,000 documents, which the court approved. These searches were largely ineffective. In the end, Spirit appealed for cost-shifting, and the court agreed, leaving Lawson responsible for the estimated $600,000 bill for the technology-assisted review he requested.

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Lessons from Lawson v. Spirit AeroSystems

There are many lessons to be learned from this decision. Chief among them is that it is crucial to keep ESI searches focused, proportional, and inexpensive to the furthest extent possible. Discovery requests that are deemed burdensome or disproportionate could spiral into major costs for the party requesting them if the court considers those requests abusive or burdensome.

Also interesting in this case is the fact that the court approved all of Lawson’s requests, even including technology-assisted review, despite warning him regarding cost-shifting. In this case, rather than being stopped by the court, the discovery process was allowed to continue even as costs rose and rose. This sends a clear message: it is the requesting party’s responsibility to carefully consider their requests’ scope and relevance.  

The Importance of Managing the Costs of Discovery

The role of technology-assisted review in escalating the costs of the discovery process is also instructive. Although new technologies may be more powerful than traditional methods, the lesson here is that attorneys must carefully consider the cost-effectiveness of these solutions before requesting them. In Lawson’s case, only around 3% of the documents that underwent technology-assisted review at his request proved relevant. This provided a startling contrast between the massive cost of the procedure and its minimal relevance or importance to the case, setting the stage for the court to side with Spirit and shift the costs to Lawson. 

While cost-shifting is not set to become a regular feature of the ediscovery process, it is crucial to understand the risks you generate for yourself by making unduly burdensome requests for information. Assessing the relevance of your requests and minimizing cost through careful consideration of the involved technologies could make all the difference, especially in cases like Lawson v. Spirit AeroSystems, where massive amounts of electronically-stored information must be produced and reviewed. Technology in the discovery process is only ever as useful as the information it produces — and so counsel ought to be confident regarding the returns they expect. 

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