In Berger v. Graf Acquisition, LLC, No. 2023-0873-LWW (Del. Ch. Oct. 21, 2024), Vice Chancellor Lori W. Will rejected the plaintiff’s insistence that the defendants conduct a manual review, stating: “the defendants may use TAR to reduce their discovery burden, so long as they are transparent with the plaintiff about their computer-assisted review process.”

Case Discussion and Judge’s Ruling

In this putative class action brought by a former stockholder regarding communications over a merger, the parties dispute search terms regarding a group of documents referred to as the “2020-2021 Documents”. The defendants stated that the plaintiff’s proposed search criteria, which would require the review of 125,000 documents, is burdensome and disproportionate to the needs of this case. As Vice Chancellor Will stated: “The search terms alone support their argument. They include unlimited terms like ‘Dee’ (80,053 hits with family), ‘Velodyne’ (41,182 hits with family), and ‘grafcq.com’ (77,573 hits with family)…But the defendants’ counterproposal went too far. It eliminated terms relating to important issues such as Velodyne’s products and Graf Industrial founder shares, and it applied extensive proximity limiters to other terms.”

To address this issue, the defendants proposed to use technology assisted review (TAR), and agreed to review the universe of documents captured by the plaintiff’s broad search terms so long as they were able to employ a TAR protocol. But the plaintiff rejected the offer and insisted that the defendants conduct a manual review instead.

Regarding defendant’s proposal to use TAR, Vice Chancellor Will stated: “TAR promotes efficiency in the discovery process in several meaningful ways…First, with appropriate quality control and system training, TAR reduces the document set for human review and limits it to documents more likely to be responsive…Second, TAR processes apply a more uniform relevance standard than manual document review using keyword searches…Third, and relatedly, a more manageable document set for manual review means lower costs for litigants… TAR can also yield superior results. The plaintiff fears that TAR has ‘the potential [to] exclud[e] responsive documents from the review process.’…But this is a risk in any document review—including by human reviewers. ‘[S]tatistics clearly show that computerized searches are at least as accurate, if not more so, than manual review.’”

Continuing, Vice Chancellor Will stated: “TAR provides a balanced solution to the conflict between a requesting party’s desire for broad discovery and a producing party’s incentives to limit burden and resource depletion. Whether to employ it is a matter for the producing party to decide since it is ‘best situated to evaluate the procedures, methodologies, and technologies appropriate for producing [its] own electronically stored information.’…It is not up to the requesting party to block TAR if the producing party prefers it. Nor is it necessarily a matter for the court to dictate. ‘[W]here a producing party wants to utilize TAR for document review, courts will permit it.’”

So, Vice Chancellor Will ruled for the defendants, stating: “Thus, the defendants may use TAR to reduce their discovery burden, so long as they are transparent with the plaintiff about their computer-assisted review process…Delaware counsel must remain closely involved in the review and sampling process for the TAR review. If the plaintiff believes that the defendants’ response is deficient, it may seek relief from this court.”

So, what do you think? Are you surprised that the Court ruled that the defendants may use TAR over the objections of the plaintiff? Please share any comments you might have or if you’d like to know more about a particular topic.

Case opinion link courtesy of eDiscovery Assistant, an Affinity partner of eDiscovery Today.

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