Nobody wants to be involved in litigation.  If you are reading this, chances are you have taken an active role in protecting your business from needless lawsuits by scrupulously following the law, treating your employees as the valuable assets they are, and working with talented tax and legal professionals to ensure you are thoroughly protected from unpleasant regulatory intervention.

But even the most litigation-averse business cannot avoid the possibility of that dreaded document: the third –party document subpoena.  At best, a subpoena is an unwanted hassle and, at worst, it can be a source of significant liability if it is not treated seriously. How can you best prepare your company for a document subpoena and what are your best practices if and when one arrives at your door?  Here are several suggestions to minimize the pitfalls to your business:

What is a Subpoena for Business Records?  A subpoena for business records, or document subpoena, is a common tool used in litigation where one of the parties thereto wants to acquire the records of business entities that are not a party in that civil litigation matter.  The subpoena itself will tell you the nature and scope of the requested information.  Usually it will ask that your company turn over records that in some way relate to the topic of the litigation and/or the parties involved in the litigation.  Depending on the scope of your involvement, you might have a few responsive documents, thousands of responsive documents, or none at all.

Don’t Panic.  Receipt of a document subpoena does not imply your business will be brought in as a party to the litigation.  More likely than not, you simply had some business relationship with one of the parties and they want to mine your records for information either supporting or refuting the other party’s claims and/or defenses.  Maybe the defendant rented your office space.  Maybe you used their catering services for an office party.  Experienced attorneys often find that document requests directed towards the other party are met with a great deal of resistance, and are therefore unlikely to yield fruit useful in litigation.   Some of the most useful information in litigation comes not from the other party, but from the third party (your company) that has no interest in who prevails in the underlying litigation.

Keep Good Records.  The better your records are, the less work you will need to do to adequately comply with a document subpoena.  As a responsible business owner, you presumably have systems in place for tracking and storing invoices, employee records, financial metrics, inventory, and any other documents needed for your company.  You should also ensure that your IT department knows how to store and retrieve internal and external correspondence.   The better kept your records are, the easier it will be for you to adequately comply with a document subpoena.

Learn About the Case.  It is always a good idea to learn a little about the background of the case.  This will give you a sense of your degree of involvement, and allow you to prepare any prophylactic measures necessary to protect your interests.  As discussed above, the fact that your business is not a party is a very good sign, but it doesn’t mean you might not become a defendant – or otherwise impact your business – if you are not careful.  A wage and hour claim brought by an aggrieved catering employee who may or may not have served cocktails at your holiday party probably has little to do with your business.  A product liability claim against a manufacturer who bought machinery from you might very well create problems for you down the line.  As they say, “forewarned is forearmed.”

Protect Your Own Information.  A document subpoena does not give a party to the litigation carte blanche to rifle through your intellectual property.  Depending on the nature of the subpoena, it may be a good idea to have your responsive documents reviewed by counsel to ensure that you have not inadvertently turned over trade secrets, confidential information about your customers or employees, the financial strength of your company, or your own attorney-client communications.  Remember, anything submitted pursuant to a document subpoena (at least without a protective order of some kind) may very well end up in court, as part of the public record.  There is nothing preventing your competitors from using that information to their advantage, or an aggrieved employee from taking issue with an inadvertent release of their confidential insurance or tax documents.

Comply Thoroughly, Honestly, and Transparently.  Privilege and confidentiality aside, it is always in your interests to make a good faith effort to comply with a document subpoena.  If you have taken the time to review your (carefully organized!) records, and track what you have done to seek out information responsive to the subpoena, you can protect yourself from the possibility that an angry lawyer will one day accuse you of withholding relevant information.  An inadequate response might lead to a court order to compel (and a bill from litigating party for the costs and fees they incurred filing a motion to compel) or other sanctions.  These needless hazards and expenses may be avoided if you have made a good faith effort to comply with a subpoena, and have the records to back it up.  If you have questions, have your counsel contact the firm representing the subpoenaing party.  Building up an amicable relationship with counsel early on can save you larger headaches down the road.

If you keep the factors described above in mind and keep a cool head, you should have no trouble navigating a third party subpoena. When in doubt, contact the experienced litigators at Fauver, Large, Archbald & Spray, LLP.  We can guide you through what might otherwise be a needlessly painful and expensive process.


Chris M. de la Vega, Attorney

(Direct) 805.966.7599

DISCLAIMER:  This Advisor is one of a series of business, real estate, employment, estate planning and tax bulletins prepared by the attorneys at Fauver, Large, Archbald & Spray, LLP. This Advisor is not exhaustive, nor is it legal advice. You should discuss your particular situation with us or with your own attorney. Our legal representation is only undertaken through a written engagement letter and not by the distribution or use of this Advisor.