By its own admission, the Texas Supreme Court has had fewoccasions to enter the fray of electronic discovery, but did so inthe recent mandamus proceeding In re State Farm Lloyds,Relator. In this case, homeowners sued State Farm allegingunderpayment of hail damage claims. Plaintiffs sought, and thetrial court imposed, a requirement that electronically storedinformation be produced in native or near-native form rather thanthe reasonably useable, static image forms such as PDF, TIFF andJPEG into which State Farm regularly converted ESI.

In denying mandamus and allowing State Farm to seekreconsideration by the trial court, the Texas Supreme Courtarticulated a detailed proportionality analysis for determining theappropriate form of production in future disputes, aligning it withstate and federal rules and case law.

Form ofProduction

Plaintiffs asserted production in native form was necessary toobtain metadata. Specifically, the plaintiffs expert asserted thattracked changes and comments in Microsoft Word documents, speakernotes in PowerPoint and animations or other dynamic informationwere necessary and not available in static format.

State Farms Enterprise Claims System, however, used for claimshandling, required users to upload information that they created instatic, read-only formats, stripping metadata from the uploadedfiles. State Farm contended that native production would requiredevelopment of a new process that would necessitate review of theupstream data locations, determining whether native files exist andthen engineering an extraction process.

In most litigation, ESI is collected in its original native formfrom various locations (such as laptops and servers), processed andloaded into an e-discovery review tool where it is reviewed forproduction in native form, allowing the producing party to reviewand produce the kind of metadata sought by the plaintiffs in thiscasetrack changes, speaker notes and the likeeven if files areproduced in TIFF or PDF. In this case, due to the limitations ofState Farms system, this standard was not available, leaving thecourt with two choices: allowing production in static form fromState Farms ECS system or requiring the development of a newprocess that would involve additional time and expense.

Framework for Analysis

The court recognized that metadata may be discoverable ifrelevant, but stated that this does not mean production in ametadata-friendly format is necessarily required and noted a weakpresumption against the production of metadata has taken hold.

The court held that, while a requesting party must specify theform of production under Texas Rule of Civil Procedure (TRCP)196.4, that party does not have a unilateral right to define theform. In their analysis, the court compared the Texas Rule withFederal Rule of Civil Procedure (FRCP) 34, which does not permiteither party to unilaterally dictate the form of production forESI. Instead, the form of production is subject to theproportionality overlay embedded in [the Texas] discovery rules andinherent in the reasonableness standard to which ourelectronic-discovery rule is tethered.