SAN FRANCISCO — The latest curveball in Waymo's trade secrets lawsuit against rival Uber was the disclosure that employees at the ride-hail giant routinely used such messaging apps as Wickr and Telegram, where communications can be set to self-destruct. It's one of the main reasons the trial, originally set to start Dec. 4, has been delayed until February.

Waymo has (perhaps unsurprisingly) made much of the revelation, which could add force to its prior claims that Uber intentionally destroyed evidence before and during the litigation. But even Uber's new CEO seemed to suggest that the use of such apps was inappropriate when he took to Twitter to announce that he had put a stop to their use in September.

U.S. District Judge William Alsup, who is presiding over the case, has also seemed suspicious, saying that evidence of Uber engineers discussing Waymo's trade secrets might have been lost because they used a system that was intentionally set up “not to leave a paper trail.”

➤➤ Read What's Next from Ben Hancock for insightful commentary on how new technologies are challenging old laws and changing the legal profession. Sign up here.

So far, Uber isn't facing sanctions in the case over the use of these apps. But it raises the question: Should companies ever be using these kinds of messaging tools for internal communications? Is it just inviting the risk of getting slammed for destruction of evidence?

According to discovery experts and other attorneys, there's no clear-cut answer.

“There's no generic case that's decided this,” said Thomas Barnett, a special counsel and chief of data science, analysis, and investigation at Paul Hastings in Los Angeles. “It really depends on the situation and the company's information management policies.”

While stressing that there's nothing “inherently evil” about an app that doesn't save every communication, Barnett noted certain regulated industries, such as financial services and energy, have broad rules around retaining communications that could make adopting ephemeral messaging tools problematic from a legal perspective.

Things might be further complicated by the specific facts of the litigation that a company is involved in, and the technical features of the messaging application, he added.

For example, if a company employee alleges she was harassed over a messaging app, the company might face demands from opposing counsel to preserve relevant conversations, presuming it can even do so. Apps such as Wickr and Telegram allow users to set a self-destruct timer on messages that can be adjusted beforehand, but don't allow recovery after the fact.

“It becomes tricky if there's sort of a switch you can turn on and off,” Barnett said.

In an interview, Wickr CEO Joel Wallenstrom explained the company is in the process of beta-testing an enterprise version of its messaging platform that allows companies to store data on-site and gives them more control over how it is retained for certain groups of employees. He emphasized that those settings are transparent for everyone using the app.

According to testimony by a senior Uber manager at a hearing last month, Uber had previously used a cloud-hosted version of Wickr available to regular consumers, but then began deploying an enterprise version that would be hosted on its premises.

Wallenstrom rejected the notion that there is anything wrong legally with companies using ephemeral messaging, and noted that it's not atypical for companies to try and minimize the records they keep. “From a businessman's perspective, the way it's been summed up for me is, 'There's no reason not to use it other than optics,'” he said. (Wallenstrom also wrote a lengthy blog post about this subject earlier this week.)

Jennifer DeTrani, Wickr's general counsel, acknowledged that the idea is not something familiar yet to courts. “It's hard because I think it's a new technology, and just like any new technology — like email or even fax — you've got the growing pains of trying to educate all different kinds of people,” she said.

At the same time, DeTrani said the company takes comfort in recent court decisions that have touched on the issue more broadly. She cited an August 2016 Mississippi federal court decision in which the judge wrote it is well-recognized that “routine destruction of information pursuant to a reasonable data retention policy is not grounds for sanctions.”

Having a Policy in Place

Barnett and others underscored that the best defense companies that use ephemeral messaging will have in court is a clearly spelled out data retention policy.

“I don't know if the courts would make an exception to preservation for data from these apps unless there were in place a written policy that clearly states 'we do not retain text messages,'” said Mike Quartararo, director of litigation support services at Stroock & Stroock & Lavan in New York. He said this would be an example of “defensible deletion.”

“Also, in many ways, the content of such messages becomes akin to a verbal conversation,” Quartararo added. “By analogy, litigants don't preserve every verbal exchange even if they are relevant to the issues in the case.”

Patrick Zhang, head of intellectual property at software company Atlassian, echoed that point, noting that ephemeral messaging is not the only communication method that doesn't leave a transcript. There are phone calls, video conferences, and just chatting across a desk, he said.

“[L]itigants can still get discovery into these types of communications via sworn testimony,” Zhang said in an email. “So my hope would be that the courts see this new technology development in context, rather than reacting to it as something sinister.”

Why Go Ephemeral, Anyway?

With the possible risk of facing a spoliation order, it's worth asking why a company would want to use an ephemeral messaging app in the first place.

In an August article for the National Law Review, lawyers from Mintz, Levin, Cohn, Ferris, Glovsky and Popeo argue that there are substantial practical benefits. For one, it can help contain costs for storing piles of data. And if a business' system is compromised, there's also less potentially sensitive information for hackers to get access to, they noted.

“[T]he use of ephemeral communication tools (and public disclosure of that use) may also deter potential incursion attempts as some sensitive and valuable information will no longer exist,” wrote Adam Lenain and Wynter Deagle (who's now with Troutman Sanders). “This deterrence may be particularly valuable given the increased shareholder and investor focus on data security, a dramatic uptick in data breaches, and the potential cost of a data security incident.”

The importance of companies managing sensitive information is part of the pitch behind Wickr's move into the enterprise space. While companies may configure how communications are saved differently, Wallenstrom said, “we try to be as loud as possible to say you should have informed information governance policies.”

Even Waymo acknowledges that ephemeral doesn't equal evil. Responding to an order from Alsup about the company's own use of such apps, the company's lawyers wrote that Waymo employees “do routinely use Google chat platforms with ephemeral capabilities in their ordinary course business communications,” mainly Google Hangouts.

“Since 2008, Google's company-wide default for Google employees, adopted by Waymo, is for instant message chats to be 'off the record,'” they added. “Accordingly, such chats are not archived on Google's servers unless one of the chat participants has changed the status of the message to be 'on the record,' in which case the message will be archived for that user.”

Although a part of its brief is redacted, Waymo's lawyers seem to try and draw a distinction between using ephemeral communications for “normal business tasks” and what Uber was doing, implying that Uber was actively trying to hide something.

Joan Washburn, director of e-discovery services at Holland & Knight, warned that ephemeral messaging can be a “double-edged sword.” Companies on one hand might erase evidence that could be harmful or sensitive, but they might just as easily weaken their own ability to present the facts of a case in a way that's more advantageous for their side, she said.

“If you are going up against the biggest developer of driverless cars and you hire someone from that company, I would think that the prudent approach would be not to have ephemeral communications,” Washburn said.

SAN FRANCISCO — The latest curveball in Waymo's trade secrets lawsuit against rival Uber was the disclosure that employees at the ride-hail giant routinely used such messaging apps as Wickr and Telegram, where communications can be set to self-destruct. It's one of the main reasons the trial, originally set to start Dec. 4, has been delayed until February.

Waymo has (perhaps unsurprisingly) made much of the revelation, which could add force to its prior claims that Uber intentionally destroyed evidence before and during the litigation. But even Uber's new CEO seemed to suggest that the use of such apps was inappropriate when he took to Twitter to announce that he had put a stop to their use in September.

U.S. District Judge William Alsup, who is presiding over the case, has also seemed suspicious, saying that evidence of Uber engineers discussing Waymo's trade secrets might have been lost because they used a system that was intentionally set up “not to leave a paper trail.”

➤➤ Read What's Next from Ben Hancock for insightful commentary on how new technologies are challenging old laws and changing the legal profession. Sign up here.

So far, Uber isn't facing sanctions in the case over the use of these apps. But it raises the question: Should companies ever be using these kinds of messaging tools for internal communications? Is it just inviting the risk of getting slammed for destruction of evidence?

According to discovery experts and other attorneys, there's no clear-cut answer.

“There's no generic case that's decided this,” said Thomas Barnett, a special counsel and chief of data science, analysis, and investigation at Paul Hastings in Los Angeles. “It really depends on the situation and the company's information management policies.”

While stressing that there's nothing “inherently evil” about an app that doesn't save every communication, Barnett noted certain regulated industries, such as financial services and energy, have broad rules around retaining communications that could make adopting ephemeral messaging tools problematic from a legal perspective.

Things might be further complicated by the specific facts of the litigation that a company is involved in, and the technical features of the messaging application, he added.

For example, if a company employee alleges she was harassed over a messaging app, the company might face demands from opposing counsel to preserve relevant conversations, presuming it can even do so. Apps such as Wickr and Telegram allow users to set a self-destruct timer on messages that can be adjusted beforehand, but don't allow recovery after the fact.

“It becomes tricky if there's sort of a switch you can turn on and off,” Barnett said.

In an interview, Wickr CEO Joel Wallenstrom explained the company is in the process of beta-testing an enterprise version of its messaging platform that allows companies to store data on-site and gives them more control over how it is retained for certain groups of employees. He emphasized that those settings are transparent for everyone using the app.

According to testimony by a senior Uber manager at a hearing last month, Uber had previously used a cloud-hosted version of Wickr available to regular consumers, but then began deploying an enterprise version that would be hosted on its premises.

Wallenstrom rejected the notion that there is anything wrong legally with companies using ephemeral messaging, and noted that it's not atypical for companies to try and minimize the records they keep. “From a businessman's perspective, the way it's been summed up for me is, 'There's no reason not to use it other than optics,'” he said. (Wallenstrom also wrote a lengthy blog post about this subject earlier this week.)

Jennifer DeTrani, Wickr's general counsel, acknowledged that the idea is not something familiar yet to courts. “It's hard because I think it's a new technology, and just like any new technology — like email or even fax — you've got the growing pains of trying to educate all different kinds of people,” she said.

At the same time, DeTrani said the company takes comfort in recent court decisions that have touched on the issue more broadly. She cited an August 2016 Mississippi federal court decision in which the judge wrote it is well-recognized that “routine destruction of information pursuant to a reasonable data retention policy is not grounds for sanctions.”

Having a Policy in Place

Barnett and others underscored that the best defense companies that use ephemeral messaging will have in court is a clearly spelled out data retention policy.

“I don't know if the courts would make an exception to preservation for data from these apps unless there were in place a written policy that clearly states 'we do not retain text messages,'” said Mike Quartararo, director of litigation support services at Stroock & Stroock & Lavan in New York. He said this would be an example of “defensible deletion.”

“Also, in many ways, the content of such messages becomes akin to a verbal conversation,” Quartararo added. “By analogy, litigants don't preserve every verbal exchange even if they are relevant to the issues in the case.”

Patrick Zhang, head of intellectual property at software company Atlassian, echoed that point, noting that ephemeral messaging is not the only communication method that doesn't leave a transcript. There are phone calls, video conferences, and just chatting across a desk, he said.

“[L]itigants can still get discovery into these types of communications via sworn testimony,” Zhang said in an email. “So my hope would be that the courts see this new technology development in context, rather than reacting to it as something sinister.”

Why Go Ephemeral, Anyway?

With the possible risk of facing a spoliation order, it's worth asking why a company would want to use an ephemeral messaging app in the first place.

In an August article for the National Law Review, lawyers from Mintz, Levin, Cohn, Ferris, Glovsky and Popeo argue that there are substantial practical benefits. For one, it can help contain costs for storing piles of data. And if a business' system is compromised, there's also less potentially sensitive information for hackers to get access to, they noted.

“[T]he use of ephemeral communication tools (and public disclosure of that use) may also deter potential incursion attempts as some sensitive and valuable information will no longer exist,” wrote Adam Lenain and Wynter Deagle (who's now with Troutman Sanders). “This deterrence may be particularly valuable given the increased shareholder and investor focus on data security, a dramatic uptick in data breaches, and the potential cost of a data security incident.”

The importance of companies managing sensitive information is part of the pitch behind Wickr's move into the enterprise space. While companies may configure how communications are saved differently, Wallenstrom said, “we try to be as loud as possible to say you should have informed information governance policies.”

Even Waymo acknowledges that ephemeral doesn't equal evil. Responding to an order from Alsup about the company's own use of such apps, the company's lawyers wrote that Waymo employees “do routinely use Google chat platforms with ephemeral capabilities in their ordinary course business communications,” mainly Google Hangouts.

“Since 2008, Google's company-wide default for Google employees, adopted by Waymo, is for instant message chats to be 'off the record,'” they added. “Accordingly, such chats are not archived on Google's servers unless one of the chat participants has changed the status of the message to be 'on the record,' in which case the message will be archived for that user.”

Although a part of its brief is redacted, Waymo's lawyers seem to try and draw a distinction between using ephemeral communications for “normal business tasks” and what Uber was doing, implying that Uber was actively trying to hide something.

Joan Washburn, director of e-discovery services at Holland & Knight, warned that ephemeral messaging can be a “double-edged sword.” Companies on one hand might erase evidence that could be harmful or sensitive, but they might just as easily weaken their own ability to present the facts of a case in a way that's more advantageous for their side, she said.

“If you are going up against the biggest developer of driverless cars and you hire someone from that company, I would think that the prudent approach would be not to have ephemeral communications,” Washburn said.