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The Cost Of Ediscovery

What is eDiscovery?

Before, all businesses store data and information in paper documents. But with breakthroughs made in Information Technology over the past two decades, businesses have switched to using computers as a major device in storing and managing information. A large fraction of these electronic data contain legally sensitive information that may be used as evidence in a civil or criminal legal case. With this, the process known as eDiscovery has become popular in acquiring evidences to be used in lawsuits. Electronic discovery or commonly referred to as E-discovery is a process wherein electronic data in the form of text, images, databases, spreadsheets, audio files, etc. are being used as evidence in civil or criminal legal litigations.

Electronic Data vs Paper Documents

Electronic data is easy to store, manage, share, and search compared to hard copy data. These characteristics have made electronic data suitable in investigations. Another feature of electronic data which cannot be found in paper documents is the metadata or metainformation that usually go together with electronic data. Metadata is the data about the data, with it more information such as the author and the date the file was created becomes available.

Impact on Business Organizations

As business organizations continue their day to day routine, the amount of Electronically Stored Information (ESI) that needs to be managed also increases. With tightening regulations that have to be put into consideration and the increasing litigations companies have been forced to confront, more and more have become aware of the legal risks involved in managing Electronically Stored Information. This has led companies to invest in information risk management systems and document retention policies.

eDiscovery is a costly process for businesses. Millions of dollars have been spent in eDiscovery. Since the 2006 amendments to the federal procedures for e-discovery, companies have been taking eDiscovery seriously. DuPont spent approximately M reviewing documents in eDiscovery, only to find out that those documents should have been destroyed long ago according to according to existing document retention policies. UBS Warburg and Merck were fined .2M and 3M respectively in litigation that required eDiscovery of files. The Prudential Insurance Company of America was fined more than M for not preserving certain records that proved to be crucial by the courts.

Business organizations have always been left overexposed to documented-related risks. According to The Tower Group, there are about 7.5 million Microsoft Office documents created every year. About 35% of all corporate documents contain legally sensitive information (Cohasset Survey 2005). 25% of corporate documents are subject to regulatory compliance (Vanson Bourne Consultancy) and only about 30% of businesses have implemented technology to facilitate the retention and disposal of documents across the enterprise.

These documented-related risks can come from many directions, some of the primary risk forces as identified by NextPage.com include:

Your Enterprise. On the average 80% of the Office documents that companies create are stored in hard drives and scattered shared drives. Combined with the continuing problem of user adoption of new tools, they becomes exposed to information risks.

Employees. High-risk documents on employees’ computers and the neglect in complying to document retention policies becomes a dangerous combination for businesses.

Clients. The inability to meet with contractual obligations can create obvious and unacceptable liabilities for businesses.

Regulatory. Most businesses have been required by government regulations to have written document retention policies in place and effectively execute these polices. In too many cases, uncontrolled documents on the desktop lead directly to non-compliance with these regulations.

Legal Departments. Business leaders must manage the effects of legal issues to business productivity.

Reactive vs Proactive eDiscovery

A good article from IT Today by Ursula Talley explains the difference between reactive and proactive eDiscovery. Reactive eDiscovery means taking actions after receiving a discovery request. Proactive eDiscovery on the other hand is the other way around, organizing and managing information in advance, thus giving companies a better response to future discovery requests.

With the concept being relatively new and the tedious tasks involved in managing electronically stored information, most business organizations are still reacting to eDiscovery requests. But as time goes by, more and more companies are switching to proactive eDiscovery given the obvious advantages of having it over reactive eDiscovery.

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by Ed Yourdon

Growing Trends in eDiscovery Litigation

It has certainly been a while since eDiscovery has become an indispensable part of litigation. There are noticeable trends that eDiscovery litigation has brought with its growth. Here are a few of them:

·         Owing to advanced eDiscovery capabilties, litigators can now enter into cost benefit analysis early on in the eDiscovery process.

·         Electronic documents, including images, placed online on a secured database grant everyone associated with the case access to these files. This reduces the number of copies made of these files/documents, thus ensuring money is saved on every copy.

·         With eDiscovery litigation support, determination of documents relevant to the case has become quicker, ensuring that billable hours are considerably reduced.

·         Even as the case progresses, eDiscovery helps ensure that all evidence is in a secure and convenient online file. The costs incurred while doing so are generally passed on to the client.

·         With the brisk growth rate of electronically stored information, companies wrestle with risks to information from fresh sources like cloud computing, virtualization, etc. It is possible that to test this litigators will need to see if eDiscovery litigation support software can be effective and can ensure that data is efficiently searchable in the cloud.

·         With the increase in the use of eDiscovery for litigation, there will be IT evaluations that will review the effect of new technologies on eDiscovery processes.

·         Because of the increased usage of eDiscovery IT/Legal, the role of liaison has been considered  separate,with budgets allocated for it specifically.

·         The ability to mix well with technology yet also be a cost-effective solution will be something most law firms will continue to seek in an eDiscovery tool. This is perhaps an ongoing trend.

·         eDiscovery platforms should ensure quality each time. Be it for processing needs or documentation requirements, the onus is on the platform to be defensible.

·         Another important aspect that perhaps will be stressed even more is the ability of the tool to preserve data in such a manner that it eventually reduces the amount of documents needing to be reviewed.

·         Litigation support professionals would eventually train themselves in IT tools and techniques to maximize their support to their clients.

These are just a few trends that we will continue to see in the field of eDiscovery and its growth .So here’s to greater discovery in the e-discovery process!

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How Does in-House EDiscovery Help?

eDiscovery is a process executed to help legal teams and departments sort, cull and retrieve relevant electronic data as proof for litigation. The results can tremendous, and now there is an overwhelming increase in the demand for eDiscovery solutions. The complexity of the process can cause many corporations to seek help from outside sources, but those same corporations are gradually awakening to the fact that outsourcing is often an expensive endeavor.

Organizations are now taking the initiative to implement in-house eDiscovery solutions in order to cut down on those heavy expenses. In doing so, it is essential that companies first evaluate the nature of their eDiscovery process and which segment should be in-sourced to generate favorable ROI. There are also other factors that govern the decision for implementation of in-sourced electronic discovery solutions:

Transparency – In-house eDiscovery solutions facilitate cost visibility for the duration of the eDiscovery process, and also assess its effects on the entire management.

Control – Managing the data, people and tools in-house gives better insight into eDiscovery search performance and also minimizes the risk involved in trusting outsiders with internal investigations.

Greater efficiency – You can build your data and processes, thus reducing your costs over a span of time. With every case you will gain experience and become proficient in collecting, processing, analyzing and reviewing documents. There is no need to hire new people or install new software for each new case.

When any organization decides to implement an in-house eDiscovery solution, they should follow these tips:

An eDiscovery solution should have the capacity to perform all the processes defined by the EDRM standard. It should be adept in information management, identification, preservation and collection, processing and early case assessment, providing concise data to the legal team for review. If the eDiscovery solution fails to serve its overall purpose, it only adds to your woes.

Companies who plan to use in-house eDiscovery should insist on using an open integration platform that supports various email systems, storage and archiving systems, content and document management systems. When the data is migrated from one server to another, the system should be able to read from both servers. The eDiscovery tool’s versatility is the key to an effective eDiscovery process. It should read data from desktops, laptops, shared file servers, PCs, content management systems and storage systems as well.

The performance of in-house eDiscovery tools should not waver in the absence of employees, and should have a flexible schedule that can be processed with no disturbance to normal functions.

The tools should be compatible with corporate records and management policies such as data back-up, migration, etc., to avoid any accidental data deletion.

The eDiscovery solution that you implement should be able to identify stored information with relevance to content type, access time, system location and size, and create a complete profile of that data so you are aware of the liabilities and can respond quickly to legal requests.

The solutions provided should not alter the existing data while moving or copying it. It is essential to maintain data in its original form.

All relevant information should be available when required for any legal or auditing purpose before the collection process is completed. This means that during the process of collection and preservation, the solution should be capable of providing data that has been saved and indexed.

Any processing action should not change the original content. Attaching digital signatures validates the authenticity of the content before and after the collection process.

Searching for items, terms and language in files, emails and attachments accurately is what makes eDiscovery solutions worth the investment. Performing critical search operations with complicated language helps reduce the cost and time of the companies.

Invest in a solution that is easy to use and maintain.

Many organizations are beginning to understand the value of in-house eDiscovery for internal investigations. The costs that can be saved, the reduction of time lost when responding to legal requests , the better handling of internal data storage and management are some of the advantages that are prompting organizations to adopt this new approach.

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