MICRON TECHNOLOGY, INC., Plaintiff and Counterclaim Defendant, v. RAMBUS INC., Defendant and Counterclaim Plaintiff C.A. No. 00-792-KAJ United States District Court, D. Delaware Signed July 11, 2006 Counsel Diane C. Hutnyan, Pro Hac Vice, Glen E. Summers, Pro Hac Vice, Jared Bobrow, Pro Hac Vice, Jon R. Steiger, Pro Hac Vice, Kevin Y. Teruya, Pro Hac Vice, Phillippe Z. Selendy, Pro Hac Vice, Robert J. Becher, Pro Hac Vice, William C. Price, Pro Hac Vice, Frederick L. Cottrell, III, Chad Michael Shandler, Richards, Layton & Finger, PA, Wilmington, DE, for Plaintiff and Counterclaim Defendant. Frederick L. Cottrell, III, Richards, Layton & Finger, PA, Mary B. Graham, Morris, Nichols, Arsht & Tunnell LLP, Wilmington, DE, for Defendant and Counterclaim Plaintiff. Poppiti, Vincent J., Special Master SPECIAL MASTER’S FINDINGS AND RECOMMENDATION ON REQUEST OF PLAINTIFF MICRON TECHNOLOGY, INC. TO COMPEL CERTAIN DISCOVERY FROM DEFENDANT RAMBUS INC. (RE: D.I. 823) DENIAL OF MOTION RECOMMENDED. *1 This matter comes before me, as Special Master,[1] at the request of Plaintiff Micron Technology, Inc. (“Micron”) to compel Defendant Rambus Inc. (“Rambus”) to restore and produce material stored on backup media. Background 1. In March 2005, Rambus discovered the existence of certain backup media while preparing for the then-scheduled trial in the Hynix litigation.[2] After notifying Hynix and other related parties, including Micron, of the media discovery, Rambus categorized the media to determine which media was likely to have responsive documents. Generally, the two categories of media identified include backup media created between May 19, 1996 and before December 28, 2000, and backup media that Rambus asserts are blank or otherwise “bad”.[3] Rambus then restored and reviewed 47 pieces of media which it determined may have responsive documents, including: (1) a nineteen-tape set of backup tapes which Rambus represents is a complete backup as of May 19, 1996, (2) twenty-eight pieces of media created between May 19, 1996 and February 2000, and (3) select folders on twenty pieces of media. From that process, Rambus produced approximately 61,000 pages of documents from the backup media. Rambus asserts that this process contained approximately 109.5 gigabytes of data, required several months to complete, and cost in excess of $1 million. 2. Micron admits in its letter to the Special Master that it was aware of the backup media as early as April 6, 2005, when Rambus notified Micron of the discovery.[4] Moreover, Micron also admits that when Rambus arranged with Hynix to examine the media claimed to be blank or “bad”, Rambus afforded Micron the opportunity to participate in the process and examination. Indeed, Micron representatives, including two of its electronic discovery experts, attended the inspection. Micron further admits that it reserved any applicable rights in a May 25, 2005 letter to Rambus, where Micron states, “[w]e submit these comments, and participate in this process in the Hynix case, without prejudice to Micron’s rights to conduct its own independent protocol (including inspection, processing, testing, analysis, and data restoration) of the “blank” media in connection with the Micron case.” *2 3. Micron asserts that it was dissatisfied with the process established by Rambus and Hynix in the Hynixlitigation in April 2005. In this regard, Micron specifically objected to an inspection of the original blank tapes without it being present during a May 20, 2005 case management conference in the Hynix case. Additionally, on May 31, 2005, Micron was informed by Rambus that some of Micron’s suggestions regarding the process for the blank tapes were not going to be implemented. At the same time, some of Micron’s suggestions were accepted. 4. Despite its knowledge of the existence of backup media and its admitted dissatisfaction with the examination process utilized by Rambus, Micron did not make a request to Rambus until May 16, 2006 when Micron propounded discovery requests generally directed to the backup media. On May 23, 2006, Micron followed up the discovery requests with a letter to Rambus requesting file-level directories (a listing of every file name) for the backup media. Finally, Micron filed its Motion to Compel on June 19, 2006.[5] 5. Micron argues that Rambus should be compelled to review and produce documents from the backup media in light of the Court’s earlier determination that Micron has made a prima facie showing that Rambus spoilated documents. Micron further argues that such request will not delay the upcoming unclean hands trial scheduled for October 2006. In an attempt to target its request, Micron has proposed to limit the number of backup media to be restored to “the equivalent of 10 pieces of media”, reserving the right to make further application to compel additional production upon a showing of good cause. In this regard, Micron initially requests that Rambus produce file-level directories for all of the backup media in order to permit Micron to make a determination regarding possible responsive documents contained on the backup media. 6. Rambus opposes Micron’s request to restore and review documents from the backup media as unduly burdensome and costly because, given that the backup media was intended for disaster restoration and legacy purposes, it is not reasonably accessible. Rambus further argues that Micron’s request is untimely since Micron knew about it for a year and yet waited until a month a half prior to the close of discovery - a point where it would surely disrupt Rambus’s trial preparation. 7. On June 21, 2006, Rambus provided Micron with the directory-level structures and high-level summaries previously sent to Hynix for sixteen of the backup media. Rambus contends that the restoration of the file-level directories for those directory-level structures it sent to Micron will be “immense” in that it contains over 620,000 folders and subfolders and that those folders contain over 1.6 million individual file names. Rambus further argues that Micron specifically requests all of the file-level directories for all of the backup media. Rambus represents that its expert has said that it will take approximately two to two-and-one half weeks just to restore the file-level directories from the backup media.[6] Once the file-level directories are restored, Rambus estimates that the cost (includes processing the media and having counsel review and produce the documents) to be approximately $17,200 to process one gigabyte of data, based on the costs associated with the previously restored media for the Hynix litigation. Rambus suggests that total costs could be approximately $7.2 million.[7] Conclusion *3 Having considered the submissions and arguments of the Parties, the Special Master concludes as follows: 8. The Special Master understands that the purpose of Rambus’s backup media was to preserve electronic information in the event of a catastrophic event, as opposed to being a form of an electronic filing cabinet. 9. The Special Master is mindful of the following: first, Federal Rule of Civil Procedure 26(b)(2) provides a proportionality test in addressing discovery disputes. It states: The frequency or extent of use of the discovery methods otherwise permitted under these rules and by any local rule shall be limited by the court if it determines that: (i) the discovery sought is unreasonably cumulative or duplicative, or is obtainable from some other source that is more convenient, less burdensome, or less expensive; (ii) the party seeking discovery has had ample opportunity by discovery in the action to obtain the information sought; or (iii) the burden or expense of the proposed discovery outweighs its likely benefit, taking into account the needs of the case, the amount in controversy, the parties’ resources, the importance of the issues at stake in the litigation, and the importance of the proposed discovery in resolving the issues. Second, due to the complexity of electronic discovery, the proposed Amendment to Rule 26(b)(2) -- which is due to become effective December 1, 2006 -- provides, in pertinent part: A party need not provide discovery of electronically stored information that the party identified as not reasonably accessible. On motion by the requesting party, the responding party must show that the information is not reasonably accessible. If that showing is made, the court may order discovery of the information for good cause. With respect to the “good cause” that must be shown, the Advisory Committee Notes to the proposed Amendment to Rule 26(b)(2), state: The responding party has the burden as to one aspect of the inquiry - whether the identified sources are not reasonably accessible in light of the burdens and costs required to search for, retrieve, and produce whatever responsive information may be found. The requesting party has the burden of showing that its need for the discovery outweighs the burdens and costs of locating, retrieving, and producing the information. 10. Third, developing case law on the issue is both informative and helpful. In McPeek v. Ashcroft, 202 F.R.D. 31, 33 (D.D.C. 2001) the court held that the existence of backup media alone does not justify the restoration of that media. The McPeek Court suggested that economic considerations are also important and stated that “[i]f the likelihood of finding something was the only criterion, there is a risk that someone will have to spend hundreds of thousands of dollars to produce a single e-mail.” Id. at 34. Similarly, in Rowe Entertainment, Inc. v. William Morris Agency, Inc., 2002 WL 975713, *7 (S.D.N.Y. 2002) the court held that, in certain circumstances, a party should not be put to the expense of producing backup media when it was only created for purposes of disaster recovery. Finally, in Zubalake v. USB Warburg LLC, 217 F.R.D. 309 (S.D.N.Y. 2003) (“Zubulake I”), the court allowed for the restoration of backup media only after the plaintiff had made a clear showing that responsive documents existed on the backup media that were otherwise not available. *4 11. Against this backdrop, the Special Master concludes that Micron has not sustained its burden to show that its need for the information outweighs the expensive and time-consuming process of restoring and producing documents from Rambus’s backup media. The Special Master further concludes that three factors specifically weigh against granting Micron’s motion to compel: timeliness, cost, and fruitfulness. 12. First, Micron’s request is not timely given its delay in seeking this discovery coupled with the fact that the process of restoring the backup media is time-intensive. The timeliness factor is particularly significant given that discovery cutoff for the unclean hands phase of this litigation occurs on July 31, 2006 and the unclean hands trial is scheduled for October 2006. The Special Master credits Rambus’s argument that, even on an expedited basis, it would be unable to restore the information necessary to first provide Micron with the file-level directories in order to determine which files Micron wants Rambus to review, and then to restore and review the requested information from the various backup media prior to the scheduled conclusion of discovery. 13. Second, the immense cost associated with the restoration of the backup tapes outweighs any potential benefit that Micron may receive. As previously stated, Rambus estimates that it costs $17,200 to process one gigabyte. While it is unknown how many gigabytes the equivalent of 10 tapes will actually contain due to the various sizes of the files, the anticipated actual cost of restoring the tapes is nonetheless expected to be substantial. 14. Third, it appears that restoration of the backup media may be fruitless because Micron has failed to establish that any relevant, non-duplicative documents would be uncovered by the restoration of the backup media. For instance, in the Hynix litigation, Rambus provided certain file-level directories to Hynix from which Hynix then requested material. Rambus represents that the material produced to Hynix from this process contained no additional responsive documents. 15. In sum, Micron has not sustained its burden to show that the benefit it may receive is likely to outweigh the burden to Rambus. In particular, Micron has failed to demonstrate that non-duplicative, responsive documents exist on the backup media and that the benefit it may obtain will outweigh the hardship of costs and time consumption that Rambus will face if is made to restore and review the backup media while attempting to prepare for the unclean hands trial scheduled for October 2006. 16. The Special Master therefore concludes that Micron’s request is too much, too late. RECOMMENDATION NOW, THEREFORE, the Special Master concludes and recommends that Micron’s request to compel should be DENIED. The Special Master’s Findings and Recommendations will become a final order of the Court unless objection is taken within two (2) days as provided by the Court at the June 14, 2006 hearing. Footnotes [1] The Order Referring Case to Special Master, dated July 25, 2005, is docketed as item 690 in the captioned case. [2] Hynix refers to the litigation pending in the United States District Court in the Northern District of California, styled as Hynix Semiconductor Inc. v. Rambus Inc.; C.A. No. CV 00-20905 RMW. [3] On June 27 and June 28, 2005, a data recovery expert hired by Hynix completed most of its review of 113 of the 1074 backup media that Rambus asserted was blank or “bad” and determined that 4 of 113 tapes (less than 4%) contained recoverable data and 12 tapes could not be recovered within the allotted two-day timeframe. Of the four tapes that were determined to have information, Rambus was able to process three tapes and provided directory structures to Hynix and later Micron. [4] Micron advised the Court of same during the June 14, 2006 hearing. [5] When asked by the Court during the June 14, 2006 hearing to explain why the Motion was filed a month and a half before the discovery cutoff, counsel for Micron replied in part”... we’ve just determined that it’s worth pursuing.” [6] Rambus also represents that it took approximately 5 months to restore and review 47 pieces of media in the Hynix litigation. Micron generally asserts in its letter brief to the Court that Rambus is able to move “rapidly” because it produced its first set of responsive material within four weeks of discovering the back up media. Micron, however, did not dispute Rambus’s estimates in Rambus’s June 21, 2006 letter brief. [7] To illustrate the potential cost, Rambus represents that a set of ninety-five tapes (containing post-February 2000 information) holds 4,291 gigabytes of data. Thus, Rambus argues that assuming Micron is seeking restoration of 10% of the back up media, than Micron’s request will purportedly cost approximately $7.2 million (10% of 4,291 = 420 gigabytes; 420 gigabytes × $17,200 = $7.2 million). The Special Master notes, however, that Rambus has also stated that 47 pieces of media contained only 109.5 gigabytes of data. The Special Master further notes that in the Supplemental Case Management Statement of Rambus Inc., for the Hynix litigation that Rambus asserts that even if it were to reduce its $17,200 per gigabyte cost to $5,000, it would cost approximately $20 million to restore the data from the ninety five tapes. Even using the $5,000 per gigabyte cost in this action to process 10% of the ninety five tapes would still result in a cost of $2.1 million.