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Electronic Discovery Planning For Problem Cases - Part II
By Michael Prounis
This article is based on a speech to be delivered at the DRI Seminar on June 13, 2002 by the author. Part II of this article will follow in a subsequent issue of The Metropolitan Corporate Counsel.
Assign your most technical lawyer, best paralegal, most technical litigation support specialist and IT liaison person to be members of a Digital Discovery Unit. Problem cases urgently need this kind of resource allocation.
If you are a corporation, even if you don’t have an immediate digital discovery issue pending, begin planning early for the likelihood that electronic records will be targeted in future discovery efforts. Select a seasoned veteran to lead the charge. Decide to apply this planning policy to all business units that find themselves frequently in court or in a regulated industry.
Given the inevitability of lawsuits or regulatory actions, doesn’t it make sense for management to develop and implement policies that minimize the risks inherent in, and the cost to process, their electronic data? Here the leadership of the General Counsel and the executive management team is critical! The Plan needs to reflect the integrity and culture of the organization. It should be high profile (i.e., requiring every employee’s affirmative acknowledgement) and very visible. A simple fact in every future case or regulatory matter is that some number of company employees may be questioned about a company’s digital discovery process. When employees have solid understanding of the Plan and the Company is well organized and confident, these acts speak legions to the employee (i.e., the first line), the Court, the regulator and/or to the opposition.
Identify prior matters that involved electronic data discovery. Who were the responsible parties? Law firms? What is the volume and availability of such data? Where does it exist? What open preservation orders remain in effect? What positions in burden affidavits, motions, 30(b)6 depositions, interrogatories, witness interviews and document requests (i.e., with respect to electronic data), if any, has the client taken in these matters? What is the formal or normal method for early case assessment? Can you incorporate electronic data discovery into early case assessment? Who is responsible for negotiating the scope of discovery request? Have they been properly briefed?
For each business unit included within the unit’s scope, determine the principal business, technology and legal contacts with your organization and make them aware of the existence of your digital discovery unit. What is the current back-up policy for each business unit? E-Mail? Applications based business communications (e.g., word processing, spreadsheets, etc.)? Accounting records? Voice mail? Websites? What unique security requirements does each of these business units have with respect to the collection of electronic data? Is policy followed? Written logs?
Rule No. 5: Develop Digital Discovery Best Practices
What “best practices” exist or could exist for:
Rule No. 6: Consider Using A Checklist When Interviewing Employees
Even if you have a digital discovery unit already in place from the outset of a problem case, insulate the client from any additional damage by carefully documenting the distribution method for notices of judicial preservation orders, electronic record holds or however such information is collected.
Hold employees accountable for providing detailed information about their digital archives. An individual’s mistake can quickly be superimposed on an entire Company. On a problem case, it is helpful to record what employees tell you about their archive (i.e., see below). Often individuals may hope to defer discussion of uncomfortable topics or hope that by providing less than complete information that the issue will go away. Make sure that you can track specific answers back to individuals in the event that an individual’s documents become the focus of discovery or of an investigation or regulatory matter. A sample checklist may be obtained at www. evidenceexchange.com.
Rule No. 7: Find Out What You Don’t Know Early
It is impossible to defend against the unknown, so set out early to find out what you don’t know. One thing that you might not know is whether any company data is already being preserved somewhere on another matter. If that’s the case and you have a 14-day e-mail retention cut-off, then what prevents those preserved records from being potentially relevant? Plaintiffs are hunting down facts like these and looking to poke holes in your back-up policies. When dealing with legacy systems data, consider restoring critical time frames first and older tapes later when and if needed. The key is to break the archive into categories by treatment needed, estimated time to process, so as much volume as possible is processed in the agreed time period, with exceptions to follow (e.g., rolling productions by person). By doing so, the archive can be prioritized and costs can be managed.
Rule No. 8: Meet/Prep Your Official Records Custodian Early
With increasing frequency, innocent IT employees are made to look incompetent or worse during 30(b)6 depositions because they have not been prepped to withstand scrutiny. The very best training I ever received was at Andersen’s Expert WitnessTraining School, where trainees were pulverized for three days by various styles of “litigator” and at various room temperatures.
Even when a company is well organized with respect to digital discovery, the other side will try to suggest that any digital discovery problem was intentional; an inconsistency was a conspiracy plot and that a hard working IT professional is dishonest. Sounds sinister, but in many real life examples, experts are called into situations to indirectly interview an IT professional being fielded as the electronic records custodian. In less than twenty minutes, this hard-working individual can often be made to look something like a saboteur.
Sometimes the untrained lawyer doesn’t know what digital discovery questions to ask and don’t expect the average IT person to know your game either! These folks’ only exposure to the legal process may have involved jury duty, unless the company finds itself frequently in litigation or in a regulated industry.
Rule No. 9: Anticipate More Frequent Challenges to E-Discovery Effort
Regulators and plaintiffs will continue to place heightened emphasis on not only production format (e.g., native file exchange, etc.) but also upon the specific process employed to comb the corporate archive of electronic records and produce the responsive information to which the requestor is entitled. How will your company hold up under increased scrutiny from a process standpoint? How good is the documentation? Which search engine and search terms were used? Did the software search e-mail attachments? Did you search the native files or the TIFF after it was OCR’d? Was the proper universe searched? How did you handle duplicates? How about the metadata? What steps were taken to protect privileged data and trade secrets? How did you break up e-mail and attachment pairs? Did you make productions of unsecured, unnumbered digital files? How did you handle viruses encountered? How were redactions made? How did you process difficult to read file formats? What is the precise chain of custody? Isn’t it time to expect this minimum level of detail be maintained by your IT Department, law firm or digital discovery service provider?
Rule No. 10: There’s No Going Back!
Once upon a time, the facts of a matter existed only on paper. If you could find the paper and review the paper, then you’d done your job. With computers, great liberties can be taken with respect to how much information is collected and how it is filtered. To do your job today, you really need to pay attention to a completely different set of issues than you did when you first learned this profession, even if that was only two years ago. Digital discovery data is growing 50% per year. Paper is growing at 5% per year. 93% of current knowledge is born digital and remains digital until retrieved for some business or regulatory purpose. Four billion gigabytes (4 exabytes) of new e-discovery data will be created by business this year alone. That’s more information than has ever been printed on paper!
Yet, today, the vast majority of e-mail and electronic data productions are amazingly still paper-based. Plaintiffs often negotiate away their rights to the native files, often because they don’t know what to do with the raw data and/or because they fear the double-edged nature of the Digital Discovery sword.
Only in the “digital discovery world” can you take data born digital and produce it as paper or TIFF so that the other side has to rescan it and OCR it, before they can search it! Don’t most applications have some searching functionality? If so, why then should the other side jump through hoops to search it? Fortunately, over the last year, new generations of digital discovery and production tools have been introduced. They provide verifiable, web-based proof against tampering and are created directly from their original electronic formats. The canonical format most frequently used to render electronic documents, the Portable Document Format or PDF, supports advanced indexing and searching (i.e., for selecting electronic documents for responsiveness) and high-speed printing (i.e., in excess of 180 pages per minute). It has become the “format of choice” for filings with federal courts.
VI. Summary
What effect, if any, will Enron have on all lawyers, as they weigh modern discovery risks, and attempt to implement effective practices so they can deal with digital discovery in a predictable and professional fashion? Enron has raised the bar for every player. Lawyers may now be more frequently challenged to prove that their digital discovery and production efforts are defendable and appropriate? We will need to see what develops. But, Digital Discovery is too expensive to be handled on an ad-hoc basis! Moreover, on the problem case, the stakes are too high to be left to third parties or low-level personnel! Our field generals must weigh in early on digital discovery strategy!
Problem cases are difficult enough without being saddled with unnecessary distractions. Given the inevitability of lawsuits and the rising cost of litigation, companies should look to formalize a digital discovery plan. In the current climate, not having your digital discovery and production act together is akin to having a time bomb ticking in your company archives. It may never detonate, but if and, more likely, when it does, the expense and disruption will be considerable! I guess that might simply be the cost of litigation, but that seems a little too cynical for me! This article has attempted to identify some practical steps that any law department can take to get the digital discovery planning process going and then keep it going long after encountering the problem case!
Michael Prounis is the Chief Executive Officer and Co-Founder of Evidence Exchange, a New York based Electronic Data Discovery solutions provider. Having worked in the legal systems technology and services sector since 1977, he founded Arthur Andersen LLP’s first offering in this area, joining the Andersen partnership. After working in this area under several corporate ownerships, he co-developed Evidence Exchange’s Secure Digital Photocopier(“SDP”), a new digital discovery and production methodology that streamlines and secures the electronic discovery process, emphasizing source document preservation, archive control, digital evidence authentication and detailed chain of custody documents. He can be reached at michael.prounis@evidence exchange.com.
Evidence Exchange (212) 594-2500
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