Sunday, April 1, 2007

Court permanently enjoins use of Electronically Stored Information in Bankruptcy!

For those late-comers still reviewing this post, please take note of the DATE of the post. I don't want to hear any unfortunate stories of overeager associates citing to the "opinion" referred to herein as demonstrative of why it is so important to verify citations before trotting your briefs down to the court house.

In a ground-breaking opinion certain to be readily adopted as a uniform rule by all bankruptcy courts in the nation, a Texas bankruptcy court has issued an order permanently enjoining the use of ESI, in any manner, in future bankruptcy proceedings.

In the matter styled Reverend Horton Heat, et al v. Zach's Club 54, (In re Club 54), 71 B.R. Supp. 666 (Bankr. N.D. TX 2007), Judge William "Chase" Roach, bankruptcy referee for the United States Bankruptcy Court, Northern District of Texas, Canyon Division, sent shock waves through the bankruptcy bar with Friday's ruling. According to Roach's acerbic opinion, the recent amendments to the Federal Rules of Civil Procedure regarding the role of ESI in discovery have disrupted a bar already rocked back on it's heels in the wake of BAPCPA. The Club 54 opinion cited many "dangerous, disruptive and damned uninformed web sites and blawgs [sic]", which included several less than favorable references to this "blawg", as proof that ESI has no place in the practice of modern bankruptcy.

Roach went on to explain that, rather than adapting to technology, technology will continue to adapt to the needs of the legal profession, even if such evolution is "retro in nature." According to Roach, this "retro technology" can best be proven by Google's decision to offer, free of charge , paper copies of all emails and attachments. Roach added that the newest service, known as Google Gmail Paper, provided debtor's counsel the ability to keep real documents in their possession, enabling them to focus on practicing "real law". In a footnote, Roach explained that if services such as Gmail Paper were good enough for Alberto Gonzales, it was not the court's place to "one-up" the nation's top lawyer. Roach acknowledged that his decision will "significantly shorten the careers of this new crop of techno-lawyer wannabe's and forensic snake oil salesmen", and went on to suggest that any lawyers or vendors displaced by his decision consider Baylor dental school as an alternative. In a shot apparently levelled at this author, Roach suggested a reality-television show on the Comedy Channel.

Roach, a known long-time supporter of NASCAR, likened the use of ESI in the courtroom to the introduction of the "Car of Tomorrow". In yet another footnote, Roach prophesied that, unless the march of ESI into the bankruptcy courtroom were stopped now, it would be the equivalent of "letting one of those damned hybrids on the track." It should come as no surprise to commentators familiar with the influence racing has among lawyers and judges in the South, that Roach is a die-hard supporter of the "Car of Yesterday".

Counsel for the parties involved were not certain of either was willing to appeal the court's ruling. One source close the matter stated, "This ruling is great for the lawyers, because it means we don't need to do anything that we haven't been doing for decades. Nothing new to learn, no changes to how we prepare for new filings, no one else to have to share fees with. Aside from having to suffer through a three day hearing with this Judge, who is kinda creepy, this really is a great outcome for us. I mean, for us as lawyers."

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