FIND A CONTRACTOR BUYER'S GUIDE
BECOME AN INDUSTRY PARTNER
MCAA Logo
MEMBER LOGIN JOIN
NEWS
The 2026 MCAA Annual Online Auction ↗

How Court Rules Can Impact Your Business

Words: Timothy Aho
/Public/News/20070727083000-1.jpg" width="300" height="200" border="0" alt="Recent changes to the FRCP have caused a ripple through businesses of every type around the country. © 2007 JupiterImages Corporation.">
Recent changes to the FRCP have caused a ripple through businesses of every type around the country. © 2007 JupiterImages Corporation.

The Federal Rules of Civil Procedure (FRCP) govern the process that federal courts follow when hearing cases of a civil nature. Although federal courts are required to apply the substantive law of a particular state when deciding a case, they use the FRCP as their rules of procedure.

Recent changes to the FRCP have caused a ripple through not only law firms and the courts, but also through businesses of every type around the country. While procedural court rules generally reach only inside the courtroom, the new amendments to the FRCP mandate that companies change their entire approach to maintenance and preservation of electronic records.

Why Should You Care?
Federal courts have diversity jurisdiction over all cases where the parties are from different states and the amount in controversy exceeds $75,000. In addition, federal courts have jurisdiction over cases involving a violation of a federal statute or regulation, including employment, tax and immigration cases. As such, your business is exposed to at least the chance of being dragged into federal litigation.

Once in litigation, a substantial amount of time will be devoted to discovery. This phase of the case encompasses requesting and obtaining documents, taking depositions of key players, and exchanging requests and responses for written information. Accordingly, the rules relating to discovery procedure and practice are a large part of the overall rule structure.

The ubiquitous nature of e-mails has changed the entire discovery process and indeed can have major impacts on cases. In reaction, the new rules have expanded the standards and requirements upon the parties to identify, evaluate, collate and produce electronic records. A central feature of the new rules is the requirement that the parties are obliged early in litigation to divulge the existence of and describe relevant electronic records. As a result, a company that has destroyed its e-mail records prematurely, or that cannot account for the electronic records it does possess, may face greater penalties — including substantive impact to its case — than those provided under the earlier rules.

Companies that feel relatively insulated from federal litigation should nonetheless be aware of the rule changes. Indeed, the FRCP often represent the first wave of civil rules that wash across the various state courts. Changes at the federal level often mean parallel changes to the various state rules. Businesses should expect the federal changes to percolate through the state court systems during the next several years.

Get Organized and Stay Ahead of the Game
Disputes regularly occur during the discovery process. Even without extensive motions and battles over discovery, the discovery process can be tedious, time-consuming and expensive. Parties must sift through all their archives in search of those documents that must be disclosed. The ability of a party to effectively manage its electronic records can provide a significant advantage over its adversary. You can only allow your counsel a timing advantage, but you also can gain strategic advantage as the lawsuit unfolds because of superior access to information and the ability to analyze it.

Parties are required to hold early-stage conferences that include discussions of e-record issues and planning for discovery. As such, litigants will be expected to quickly have a handle of what e-records they possess, where they are, what form they are in, how accessible they are, how voluminous they are and the likely costs to compile them.

Under the new federal rules, companies should have an incentive to be more organized and to maintain more complete e-mail and electronic data archives. A company that has destroyed its e-mail records prematurely, or that cannot account for electronic records, may face penalties in court, including substantive impacts to its case and sanctions for both the violating party and its counsel. Even if sanctions are not levied, parties can incur substantial costs and efforts litigating over unnecesary discovery issues. Further, a litigant that makes early representations about its records that later prove to be inaccurate may lose credibility in the eyes of the court and the opposing party.

Stay Informed and Be Prepared
Companies and their counsel should be aware of the new rules, and stay informed on any further changes and measures to respond appropriately. If your company currently does not have clear and open communication between your information technology personnel, your employees and your attorney, you should immediately modify your electronic data policies to more effectively respond to the new obligations imposed by the federal rules.

All electronic files and data in your possession should be maintained and preserved. Your company needs to understand the nature and scope of the company's electronic data, the policies regarding the storage of the data, and the capabilities of the system in terms of producing certain data at a moment's notice. If your company does not have a standard retention policy, you should consider implementing one immediately.

This understanding and planning may be critical to not only compliance with the new rules, but also to substantial cost savings associated with discovery. Failure to do so could lead to expensive and protracted litigation, including severely jeopardizing your chances of defending against or succeeding on a particular claim.
 0
No Shortcuts: The Journey of Real Stone
February 2026

Have you ever stopped and really thought about how that stone on the wall got there? I don’t mean the install...not the mortar, the scratch coat, or the clean-up. I mean the whole journey. From the first cut in the earth to the

Rob McKay
Technical Talks
Read More
Stop Gambling on the Wall: Why the Modern Jobsite Demands a Sure Thing
February 2026

If you have spent any time walking the carpeted aisles of the World of Concrete, you know the vibe. It is a sensory overload of heavy machinery, slick demos, and the collective optimism of thousands of contractors. We are in Las Vegas, the gambling capita

Shayne Sanders
Technical Talks
Read More
Helical Beaming: Strengthening Masonry from the Inside Out
February 2026

In the world of masonry restoration and retrofit, the goal is always the same: preserve the character and craftsmanship of historic structures while ensuring their long-term stability. But anyone who has worked on century-old brick or stone buildings know

Tiffany Tillema
Technical Talks
Read More
The 2026 MCAA Annual Online Auction
February 2026

The Mason Contractors Association of America is thrilled to announce the 2026 Annual Online Auction, the masonry industry’s premier event for scoring the best equipment at a fraction of costs. Whether you are looking to expand your equipment stockpile or

Justin Stengel
Industry News
Read More