Like diamonds, e-mails are forever. The trouble is, people in business don’t always appreciate that or the way the law can release electronic hound dogs over deleted and buried e-mails to find anything incriminating.
A court in New York examining the collapse of Lehman Brothers has just overseen the review of 4,790,277 electronic documents, searching for phrases such as “don’t share this”, “between you and me” and “big mistake”.
Lehman went bankrupt in 2008 triggering a major global meltdown. It was the world’s largest bankruptcy. The amount by which taxpayers in the United States and Europe have bailed out the incompetent or fraudulent banks now runs at $14 trillion.
Tucked away in Volume 7 of the official Examiner’s report for the US Bankruptcy Court in the Southern District of New York are over a thousand expressions that were used by the Examiner as search words when scanning the e-mails of people in and around Lehman Brothers.
Some of the searches are cleverly designed. For example, searching for “*solven* w/20 (transfer* or mov* or pledg*)” will uncover any e-mail containing a word with “solven” in it, such as insolvent and solvency, wherever such words appear within a 20-word compass of words containing “transfer” or “mov” or “pledg”. So any discussions about trying to move money in the face of insolvency would be exposed.
The search terms also include financial slang phrases such as “hair or haircut or hair-cut”. Other search terms were chosen because some bankers can become careless when under pressure – hence the inclusion of “I don’t think we should” and “dumb”.
Even e-mails subjected to several stages of deletion and expunction can be recovered and used in court. In 1991, in England, the High Court decided that a database that contains “information capable of being retrieved and converted into readable form” is a “document” and therefore something that must, if relevant, be given to the other side in litigation.
Company personnel are sometimes catastrophically candid in e-mails. In the 1990s, Atlantic Richfield Company (AR) was trying to sell its solar energy subsidiary to Siemens. The subsidiary had developed an exciting new solar energy system although, unknown to outsiders, it didn’t work.
A deleted e-mail from one AR employee said: “We will attempt to finesse past Siemens the fact that we have had a great amount of trouble in successfully transitioning the technology from the lab to the manufacturing floor.” Another message called the project a “pipe dream” then said “let Siemens have the pipe.” Siemens sued AR for fraud and the e-mails were used in the trial.
E-mail vocabulary has triggered other legal problems. In 2006, in Lancashire, Ray Kennedy wanted to register an objection to a building proposal. He duly e-mailed Rochdale council. His legal right to object to the plan was violated, however, when the council’s e-mail system repeatedly rejected his legal document. The planning proposal was approved without any consideration of his objection.
It turned out that there was chaos throughout all municipal building communications at Rochdale because the e-mail system wouldn’t accept any e-mail containing the word “erection”.
The author is Professor of Law at The Open University.