On September 27, 2012, the Federal Trade Commission published final revisions to the Commission’s Rules of Practice governing its investigatory process (16 CFR Part 2) and attorney discipline (16 CFR Part 4). Spurred in large part by the challenges posed by discovery of electronically stored information, the Commission explained that the final rules will “update and improve the Commission’s Part 2 investigation process by accounting for and incorporating modern discovery methods, facilitating the enforcement of Commission compulsory process, and generally increasing efficiency and cooperation.” After the Commission published its proposed revisions on January 23, 2012, a number of individuals and organizations, including Crowell & Moring, submitted public comments regarding the FTC’s proposed amendments. While the Commission adopted the bulk of the proposed rules changes without modification, it agreed that “some of the proposed rules can be modified to better reduce the burdens of the Part 2 process without sacrificing the quality of the investigation.” Accordingly, the Commission’s modifications to the proposed rules include (1) a revision of the privilege log specifications to decrease the burden on respondents, while still accounting for staff’s need to effectively evaluate privilege claims; (2) extending the deadline for the first meet and confer to decrease the burden on recipients of process and their counsel; and (3) implementing a “safety valve” provision allowing parties showing good cause to file a petition to limit or quash before any meet and confer has taken place.

Revisions to Proposed Rules Based on Public Comments

The original proposed amendments required additional detailed and specific information for withheld privileged material to be provided on a privilege log, which must be attested by the lead or supervising attorney responsible for asserting the privilege claims [Rule 2.11(a)]. This amendment largely was adopted as proposed, but the staff responded to certain concerns raised by commenters in the final rule by permitting respondents to (1) append a legend to the log enabling them to more conveniently identify the titles, addresses, and affiliations of authors, recipients, and persons copied on privileged material; (2) more conveniently identify authors or recipients acting in their capacity as attorneys by identifying them with an asterisk on a privilege log; and (3) forego providing the number of pages or bytes of a withheld document, and instead provide document control numbers.
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On January 13, 2012, the Federal Trade Commission announced a number of proposed changes to Parts 2 and 4 of the Commission’s Rules of Practice governing its investigatory process, “[e]specially in response to growing reliance upon and use of electronic media in document discovery.”  Given the challenges posed by the routine discovery of large, non-uniform, broadly dispersed volumes of electronically stored information (“ESI”), the Commission expressed its interest in making its “procedures more efficient and less burdensome for all parties.”  It claims the proposed changes will “expedite investigatory processes” and “keep pace with technology.”

In many ways, the recognized need for reform of the Commission’s investigatory process is likely welcomed by lawyers and parties involved in Commission investigations.  For example, some may argue that the Commission historically has been hesitant to recognize the effectiveness and efficiencies that can result from advanced technologies used in modern e-discovery.  The introduction to the proposed Rules, however, states that “searches, identification, and collection all require special skills and, if done properly, may utilize one or more search tools such as advanced key word searches, Boolean connectors, Bayesian logic, concept searches, predictive coding, and other advanced analytics.”  Nevertheless, the proposed Rules create additional requirements with which practitioners and parties before the Commission should familiarize themselves.  Some of these may impose substantial risk and burdens.
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