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Quinby v. WestLB AG

September 5, 2006

CLAUDIA QUINBY, PLAINTIFF,
v.
WESTLB AG, DEFENDANT.



The opinion of the court was delivered by: Pitman, United States Magistrate Judge

OPINION AND ORDER

I. Introduction

Defendant moves to shift to plaintiff the cost of producing certain documents maintained in electronic form. Specifically, defendant seeks to shift to plaintiff the costs associated with restoring backup tapes and searching the e-mails of six of its former employees. For the reasons set forth below defendant's motion is granted with respect to shifting 30% of the costs of restoring and searching the e-mails of one of the former employees and is denied in all other respects.

II. Facts

A. Plaintiff's Employment at WestLB and Her Discrimination Claims

This is an employment discrimination action in which plaintiff alleges, in principal part, gender discrimination in violation of Title VII and retaliatory firing after she complained of the discrimination (Complaint ("Compl.") ¶ 1).

Plaintiff was an Associate Director/Vice President and later a Director in the Equity Markets Group of WestLB Panmure Securities, Inc. ("WPSI"), a division of WestLB, from May 1999 to June 2003 and again from September 2003 to April 2004 (Compl. ¶¶ 9, 14(a), 44, 48, 57). She was part of a six-person sales desk consisting of her supervisor, John Parker, three other males and one other female (Compl. ¶ 10).

Parker was the individual primarily responsible for the alleged discrimination. As supervisor, he made many of the compensation and firing decisions concerning the group's employees (7/5/05 Tr.*fn1 at 47; 7/7/05 Tr. at 79, 128-29), though he often had to obtain his superiors' approval before implementing his decisions (Defendant's Response Letter to EEOC Charge ("Def. EEOC Resp.") at 7-8, annexed as Exhibit 4 to Declaration of Carmelyn P. Malalis, Esq., dated December 2, 2005 ("Malalis Decl.") (Docket Item 69); 7/5/05 Tr. at 47; 7/7/05 Tr. at 129).

Over the course of her employment plaintiff noticed that women were treated differently than men. For example, plaintiff alleges that she and other women were "excluded from the office communications loop" and were not invited to business-related dinners and after-hours social activities (Compl. ¶ 15(a)). Furthermore, Parker and the other men in the group would often make offensive or demeaning comments and jokes about women and would sometimes announce that a client or colleague needed to be "bitch slapped" (Compl. ¶ 15(c)).

Plaintiff also alleges that she received lower pay than males on the sales desk. In March of 2000 and 2001, she earned bonuses of $475,000 and $575,000, respectively (Compl. ¶ 14). However, in March 2002, plaintiff's bonus was reduced to $100,000 (Compl. ¶ 23). Although other employees' bonuses were also reduced that year, plaintiff claims that her bonus was reduced substantially more than the bonuses of similarly situated male employees (Compl. ¶ 30).

In October 2002, plaintiff alleges that WestLB made "secret bonus payment[s]" to male members of her sales desk (Compl. ¶ 30). In November 2002, "because of the bonus issue, as well as continuing discriminatory treatment in her daily working conditions," plaintiff filed a formal grievance complaining of gender discrimination with the then-director of human resources at WestLB, Betsy Austin (Compl. ¶¶ 27, 32; September 28, 2005 Deposition of Betsy Austin ("Austin Dep.") at 22, annexed as Exhibit 14 to Declaration of Tammy Marzigliano, Esq., dated October 3, 2005 ("Marzigliano Decl.") (Docket Item 42)). Plaintiff made several more complaints to Austin "about gender discrimination in the [g]roup" in early 2003 (Compl. ¶ 33).

In March 2003, the parties reached a settlement under which plaintiff received a $250,000 "bonus" in exchange for releasing all claims against defendant for acts occurring prior to 2003 (Compl. ¶ 34; Equal Employment Opportunity Commission Notice of Charge of Discrimination ("EEOC Charge") ¶ 4, annexed as Exhibit 15 to Marzigliano Decl.; Def. EEOC Resp. at 9). Throughout 2003, however, plaintiff alleges that the discriminatory environment in her department continued, and that, among other things, Parker continued to exclude plaintiff from meetings and discussions and to direct praise and positive reinforcement solely to male salespersons (Compl. ¶ 35).

In early 2003, WestLB began planning a workforce reduction (Def. EEOC Resp. at 9). On May 9, 2003, Parker informed plaintiff that she would soon be terminated because a workforce reduction had been mandated by senior management and plaintiff's "skill set" was no longer compatible with WestLB's new business plan (Compl. ¶ 38). Plaintiff, however, alleges that at approximately this same time, Parker was interviewing male candidates to fill plaintiff's position (Compl. ¶ 40).

Plaintiff continued to work at WestLB through early June 2003 (Compl. ¶ 41). On June 6, 2003, she made an appointment to meet with Moses Dodo, the head of WestLB North America, to discuss the terms of a severance package plaintiff had proposed (Compl. ¶ 43). On June 8, 2003, however, prior to her scheduled meeting with Dodo, Austin telephoned plaintiff at home and stated that plaintiff was terminated and should not return to the office (Compl. ¶ 44). Two other people on the sales desk also resigned at this time, leaving no senior salespeople, such as plaintiff, at the desk (Compl. ¶ 47). On June 12, 2003, sales desk personnel received their bonuses for fiscal year 2002. Plaintiff did not receive a bonus (Compl. ¶ 45).

On July 17, 2003, plaintiff filed a charge with the EEOC against defendant claiming gender discrimination (Compl. ¶ 46).*fn2

In September 2003, plaintiff was fully reinstated to her former position at WestLB (Compl. ¶ 48). Two other senior salesmen were also hired at approximately this time, resulting in the sales desk having the same number of senior salespeople employed as before the workforce reduction (Compl. ¶ 49).

After her return, one of plaintiff's most lucrative accounts was assigned to a male employee who had not previously covered the account (Compl. ¶ 51). By January 2004, Parker had criticized plaintiff's performance on several occasions and plaintiff responded, in writing, that she was being held to more stringent standards than male employees (Compl. ¶ 52). On March 9, 2004, Parker advised plaintiff that she would receive no bonus for 2003 because the bank had had a poor financial year (Compl. ¶ 53). Plaintiff alleges that every other employee in her department received a bonus, including the two new male employees (Compl. ¶ 53). Plaintiff filed an internal grievance regarding her bonus with Phil Feurstein, an employee in the human resources department, who dismissed the complaint (Compl. ¶ 54; E-mail from Philip Feurstein to Claudia Quinby, dated March 31, 2004 ("Feurstein E-mail"), annexed as Exhibit 5 to Malalis Decl.).

On April 8, 2004, plaintiff filed an amended charge with the EEOC, claiming that defendant's failure to pay her a bonus was retaliatory (Compl. ¶ 56).

On April 16, 2004, defendant again terminated plaintiff's employment (Compl. ¶ 57). Soon thereafter, plaintiff filed a second amended charge with the EEOC, claiming that her firing was retaliatory (Compl. ¶ 60).

2. The Initial EEOC Charge and Defendant's Response

Plaintiff's initial charge to the EEOC, dated July 17, 2003, contained many of the allegations in the complaint that are set forth above and does not require repeating. In summary, the charge claims that plaintiff's department at WestLB was "permeated by gender discrimination," that women were left out of "the communication loop," that only male employees received regular praise, that demeaning comments and jokes about women were commonplace and that plaintiff received a lower bonus than similarly situated male employees (EEOC Charge ¶¶ 3-4).

On January 23, 2004, defendant responded to the initial EEOC charge. There, defendant claimed that plaintiff was initially terminated because there was a plan to reduce the workforce and restructure her department. Defendant further claimed that plaintiff was selected for termination because Parker conducted a "skills assessment" of the employees on the desk, and plaintiff's "skill set was the least compatible with [WestLB's] new business strategy" (Def. EEOC Resp. at 9-10).*fn3

3. The Electronic Discovery Dispute

The instant motion arises out of plaintiff's First Request for Production of Documents (the "Document Request"), served on February 18, 2005 (Defendant's Memorandum of Law in Support of its Motion to Shift the Cost of the Production of Electronic Discovery ("Def. Memo.") (Docket Item 32) at 1). There, plaintiff requested that nineteen current and former WestLB employees' e-mail accounts be searched for certain terms alleged to refer to plaintiff in particular or that are potentially sexist in general. The Document Request also sought e-mails relating to discrimination against other women at WestLB and e-mails showing that men were more highly compensated than women (Plaintiff's First Request for Production of Documents ("Document Request") ¶¶ 7, 10-21, 25-26, 31-32, annexed as Exhibit A to Affidavit of Terri L. Ross, Esq., sworn to September 12, 2005 ("Ross Aff.") (Docket Item 33)). The Document Request did not limit most of the requests to any particular period of time.

Defendant objected to many of the requests for electronic discovery claiming they were overly broad and would result in undue burden. The parties were unable to agree on the scope of electronic discovery and sought my intervention to resolve the dispute (Affidavit of Dawn J. Darringer, Esq., sworn to October 18, 2005 ("Darringer Aff.") ¶¶ 2, 5 (Docket Item 46)).

At the subsequent discovery conferences before me, plaintiff claimed that she wanted to search nineteen current and former WestLB employees' e-mails for over 170 search terms for approximately a five year period (7/5/05 Tr. at 35, 57-58; "Proposed Search Terms," annexed to Facsimile from Kathleen Peratis, Esq., to Chambers, dated July 5, 2005 ("Proposed Search Terms")). Some of the proposed search terms were words that are very commonly used in the investment banking industry, such as "asset," "deal," "insurance" and "risk" (Proposed Search Terms). Still others were even more commonly used words that could be present in practically any e-mail, including words such as "go," "her," "okay" and "she" (Proposed Search Terms).

After several discovery conferences, I limited the Document Request with respect to e-mails to searches of seventeen*fn4 current and former WestLB employees, utilizing individualized search terms for each employee; the search terms used ranged from 3 to 15 terms for any given employee (7/7/05 Tr. at 105, 116; 7/12/05 Tr. at 6, 68). For some requests I also limited the period of time to be searched (e.g., 7/12/05 Tr. at 53).

Defendant claims that in order to produce many of these e-mails, it had to restore and search backup tapes*fn5 (Darringer Aff. ¶ 5). Data stored on defendant's backup tapes is in an inaccessible, compressed format, and restoring the data to a readily-accessible format takes substantial amounts of time and results in significant expense (Affidavit of Stuart Hanley, sworn to June 27, 2005 ("Hanley Aff.") ¶¶ 8-12, annexed as Exhibit C to Ross Aff.).*fn6

When an employee leaves WestLB, it is WestLB's practice to delete the employee's e-mails from its accessible database and maintain them solely on backup tapes (Darringer Aff. ¶ 17; Supplemental Affidavit of Kenneth Bigelow, sworn to July 23, 2005 ("Bigelow Supp. Aff.") ¶¶ 4 n.1, 6, annexed as Exhibit E to Ross Aff.). Of the seventeen individuals whose e-mails WestLB was directed to search, eight are former employees (Darringer Aff. ¶ 18). WestLB converted the e-mails of six of the eight former employees -- Austin, Miguel Barron, Feurstein, Graham, Richard James and Patrick Oddoux (collectively the "Former Employees") --into inaccessible formats (Darringer Aff. ¶ 18). WestLB retained e-mails from the other two -- plaintiff herself and Parker -- on its accessible database (Darringer Aff. ¶ 18). Defendant is seeking to shift to plaintiff the costs of restoring and searching backup tapes containing the e-mails of only the six Former Employees (Darringer Aff. ¶ 18; Defendant's Reply Brief in Support of Its Motion to Shift the Costs of the Production of Electronic Discovery ("Def. Reply") (Docket Item 46) at 5).

Of the six Former Employees, three -- Barron, Oddoux and James -- were plaintiff's co-workers at the sales desk (7/7/05 Tr. at 58-59, 73, 105; 7/12/05 Tr. at 20).*fn7 Barron left WestLB in November 2002 (7/7/05 Tr. at 58), Oddoux in August 2003 (7/7/05 Tr. at 105), and James in September 2003 (7/7/05 Tr. at 73). Searches of their e-mails were limited to the terms "Claudia," "Quinby" and "CQ" (7/12/05 Tr. at 6).

As noted above, two of the Former Employees, Austin and Feurstein, worked in the human resources department and were the recipients of several of plaintiff's complaints of discrimination. They also played a role in determining WestLB's response to plaintiff's complaints (Malalis 13;*fn8 Malalis 25; Malalis 27; Malalis 31; Malalis 39; Feurstein E-mail). Austin left WestLB in December 2003 (Austin Dep. at 9). The search terms for all of her e-mails were "Claudia," "Quinby," "CQ," "Eileen," "McPeek" and "E.M." (7/12/05 Tr. at 27). Additional search terms for Austin were also ordered, but those searches were to be limited to e-mails sent to or received from employees of WPSI; the terms used were "axe," "bonus," "fire," "headcount," "pay," "complain," "retention" and "business reason," assuming it was technologically possible to search for "business reason" (7/7/05 Tr. at 78; 7/12/05 Tr. at 22, 27).

As for Feurstein, he left the bank in November 2004 (July 14, 2005 Deposition of Philip H. Feurstein at 7, annexed as Exhibit 18 to Marzigliano Decl.). Searches of his e-mails were limited to a set time period, from November 24, 2003 to November 12, 2004, and the search terms were "Claudia," "Quinby" and "CQ" (7/7/05 Tr. at 65; 7/12/05 Tr. at 6).

The final Former Employee, Graham, the head of the Equity Markets Group and Parker's supervisor, made many of the decisions regarding employee compensation and firings (Def. EEOC Resp. at 7-8; 7/5/05 Tr. at 47; 7/7/05 Tr. at 129). For example, in early 2002, Graham supervised a review of all of the employees in the Equity Markets Group and determined what their bonuses would be for the previous year. He also met with plaintiff on at least one occasion in late 2001 to discuss her annual evaluations (Def. EEOC Resp. at 7-8).

Graham left WestLB on March 31, 2003 (Letter from Claire Mathews to Dawn Groman, Esq., dated Oct. 14, 2005, annexed as Exhibit 6 to Darringer Aff.). Although Graham was discussed at the discovery conferences, due to the oversight of counsel and myself, there was never an order either compelling production of his e-mails or protecting them from being produced.

In order to restore and search the backup tapes, defendant retained an outside consultant, Kroll Ontrack ("Kroll"). Because Kroll had worked with WestLB on past projects, it was familiar with WestLB's electronic systems and storage (Hanley Aff. ¶ 12 & n.3). Over the course of one of these projects Kroll created what the parties refer to as the "Kroll Archives," which are backup tapes maintained by Kroll that contain WestLB data (Hanley Aff. ¶ 12 n.3). Restoring these tapes is slightly cheaper than restoring WestLB's own backup tapes. See Quinby I, supra, 2005 WL 3453908 at *8.

In producing the Former Employees' e-mails, Kroll restored and searched (1) 171 backup tapes for 2003 and 2004; (2) the Kroll Archives, and (3) backup tapes for employees who worked outside the United States (Second Supplemental Affidavit of Lori Carey, sworn to November 17, 2005 ¶ 8 ("Carey 2d Supp. Aff.") (Docket Item 67)). In addition to searching each Former Employee's files for responsive e-mails, Kroll also searched hard drives shared among employees within the two departments that the Former Employees worked in, i.e., human resources (also referred to as "HR") and WPSI, since these drives included additional files of the Former Employees (Carey 2d Supp. Aff. ¶ 9; Defendant's Supplemental Memorandum of Law in Further Support of Its Motion to Shift the Cost of the Production of Electronic Discovery ("Def. Supp. Memo.") (Docket Item 65) at 5). This process yielded 59,635 original, i.e. non-duplicate, documents consisting of 401,420 pages. By contrast, defendant claims it produced only 9,622 documents, or 141,702 pages, from accessible sources (Carey 2d Supp. Aff. ¶ 7).

Kroll charged defendant $181,013.28 to restore and search these backup tapes, including the backup tapes that make up the Kroll Archives (Carey 2d Supp. Aff. ¶¶ 8-9). Defendant has not explained whether this is the cost of the entire document production from inaccessible sources or whether it relates only to producing those backup tapes containing the Former Employees' e-mails. Kroll also charged defendant a 25% premium for expediting the project -- a cost defendant also seeks to shift --bringing the total to $226,266.60 (Carey 2d Supp. Aff. ¶ 11). Additionally, defendant seeks to shift the cost of re-producing some files into a different format after plaintiff complained that they were produced in a ".tif"*fn9 format ...


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