The 2015 amendments to the Federal Rules of Civil Procedure went into effect on December 1, 2015. They apply not only to cases filed on or after this date but pending proceedings “insofar as just and practicable.” The Amendments focused largely on e-discovery and how to tame discovery abuses in light of the electronic information explosion.

While the federal rules had clearly recognized that discovery should be limited based on “undue burden” for decades, the amendments expand this concept to include “undue expense.” The amendments have ushered in a new period of discovery which Ralph Losey has characterized as the “Goldilocks Era” where judges and litigants must find that “just right” balance of discovery. The discovery cannot be too broad or too expensive, but it must be “just right” considering the needs of the case.

This proportionality theme is demonstrated by Rule 26(b)’s amendments which limit the scope of discovery to any party’s claim or defense considering the needs of the case. Previously courts could allow expanded discovery to the subject matter of the case for good cause shown.

The new amendments have deleted this provision and instead adopted a proportionality analysis by considering the following factors:

• The importance of the issues at stake in the action;

• The amount in controversy;

• The parties’ relative access to relevant information;

• The parties’ resources;

• The importance of the discovery in resolve issues; and

• Whether the burden or expense of the proposed discovery outweighs its likely benefits.

These criteria are not wholesale changes as they were moved from old Rule 26(b)(2)(C). The only “new” provision is the parties’ relative access to information. However, this factor was borrowed from old 26(b)(2)(B)’s provision on inaccessible data.

In most cases, the main factor which will likely be outcome determinative is whether the expense of the discovery outweighs its benefits. In other words, is the cost of discovery proportional to the value of the case? With the revisions, parties will need to assess very early in the case just how much discovery (including e-discovery) will cost and weigh that against the “real,” non-inflated amount in controversy in the case. If a case realistically has a value of $100,000, it makes little sense for a party to have to spend $50,000 on discovery. In contrast, if a case has a realistic value of $1,000,000, spending $50,000 (or more) on discovery is reasonable and proportional to the value of the case. However, you cannot evaluate proportionality unless you understand what is required to find the information which the other side has requested and then evaluate how much it is going to cost to review and produce that information.