WHAT IS ALL THE HUBUB ABOUT E-DISCOVERY?

We have all seen them - various consulting firms advertising their new software programs for e-discovery consulting services.  Some of them even provide testimonials from various major firms - about how this or that consulting firm or this or that software is the way to go. [click here for one such example].  Better yet, click here to read an exemplar of an advertisement from one such e-discovery  firm. Perhaps someone can explain in the comments section below this post what it is that they are talking about that distinguishes what they are offering from what the IT people in a company can provide.  Better yet perhaps someone can explain in the English language what they talking about at all.

As an adjunct to e-discovery consultancy, law firms in turn are creating new practice groups specializing solely in e-discovery issues.

To all of this I say, "What the heck is going on here?"

Maybe I am just a "Caveman Lawyer" like the popular SNL character but I will tell you what I think is going on here - money.  With the advent of the new federal rules governing e-discovery, consulting firms and law firms found a new way to make money.  Some serendipity for them fueled this false demand.  Several high profile cases where companies were sanctioned for failing to produce documents - most notably the Qualcom debacle - scared the wits out general counsel.

But the Qualcom matter had nothing to do with a mere failure to find and produce.  It involved conscious or at least reckless disregard by both outside and in-house counsel in not producing highly damaging documents that completely undercut the core of their case.  The documents were readily available in an important player's email files if anyone had asked. [Click here for article summarizing the Qualcom episode]. Yet, this example along with other scare tactic marketing has thrown many large companies and their in-house counsel into a frenzy over making sure that they are not the next Qualcom.

Let's set something straight first - the new e-discovery rules are not anything really new.  The obligations articulated in these new words are merely more detailed descriptions of the obligations that any litigant had under the old version.  When you sue or get sued, you had better make sure that you put a hold on the destruction of any and all documents that might be discoverable or relevant to the lawsuit - hard copy and electronic. This has been the rule before the new e-discovery rules were adopted and it is the rule after their adoption.  And when you produce documents you better make sure that you produce responsive documents.

Yet, after the adoption of these rules consultants and law firms have begun drumming up business under the guise that somehow there has been a sea change in the playing field that must be addressed.  Whatever change occurred had nothing to do with the rules change.  Instead, it has had to do with the way business has been generating documents over the last decade or so.  Business is done electronically.

So the real question is not what should you do under the new rules, but rather what should you do with all of these electronic documents that are now generated.  It turns out that it is really not much different than what we used to do when we only had hard copy documents to deal with.

In the "old days" before electronic documents, we would go to the all the people who might have touched the issues in the case and have them provide their files to us.  A copy would be made and preserved.  We would go to the document custodian and have them pull any stored documents that might pertain to the case (e.g. stored files of the persons with knowledge or general files that might pertain to various issues in the case).

Relying on outside consultants to pare down the documents produced based upon word search protocols [something that they seem to marketing as a cost saver] is going to be the next Qualcom.  Word searches are nice for purposes of your own culling to determine what documents are of interest.  But this is a dangerous gambit when it comes to determining what should be produced.  The better safer and more cost effective approach is to be over-inclusive in what you produce and make sure that you enter into a standard protective order that provides for the return of privileged materials.

Do you need to hire a consultant who specializes in e-discovery, buy their software or pay for another partner within your outside counsel's firm who is supposedly expert in e-discovery?  I don't think so.  But it is your money.

It just involves getting the head of IT involved as soon as you are aware you are going to be or are involved in litigation.  Your IT people are the new document custodians of the electronic age.  You still have to obtain all hard copy but you now also have to obtain all currently maintained electronic material from the persons involved in the subject matter [on their computers and anywhere else that it might be stored] and anything that is maintained within the company's computer files that might relate to the issues in the lawsuit.

What can a consultant give you that is better than the IT people in your company?  Presumably the IT people will know off the top of their heads where all the nooks and crannies are that need to be searched in your database(s) and to the extent that they don't some basic questioning by litigation counsel should do the trick.  This along with making sure that your IT person keeps a clear record of what has been done should provide you with the assurance that you comply with your discovery obligations.

If you require that the documents be precisely culled down so that only responsive documents are produced [a bad/dangerous practice in my view] then there is only one way to do that and this is through actual human eyes looking at the documents.  Anything else - like relying on a computer based search protocol and you are exposing your company to risk of Qualcom sanctions or worse.  Using a consultant who performs supposedly industry standard searches will not alleviate you from your burden to produce responsive documents and the failure to do so - without eyeballing the production with human eyes - could have Qualcom like consequences.  That is why being over-inclusive in your production is a better and more cost effective practice.

If you can't understand what it is that your e-discovery consultant is talking about, that should give you pause for concern. So take a breath and realize that even though this is the electronic age it still is not rocket science when you are confronted with e-discovery.  Common sense and practical approaches are still the best way to ensure that you comply with discovery demands.   At least until courts definitively rule that following the guidances of outside e-discovery consultants is a protective shield, to do anything other than this could expose you to the sanctions that you so earnestly are trying to avoid.

Comments

[Benjamin Wright]

Stewart:
Knowing e-discovery is inevitable, I argue an enterprise can use technology proactively to make its e-records more benign. What do you think? --Ben
http://hack-igations.blogspot.com/2008/05/nix-smoking-gun-e-discovery.html

[Stewart Weltman]

If you mean prophylactic measures to cleanse documents (1) good luck (companies were hard pressed to do so when they had a small universe of hard copy documents and (2) depending on what you cause to be cleansed you could be committing a felony [e.g. obstruction of justice, aiding and abetting etc.]. For example, if an employee writes a memo reflecting that he has engaged in illegal price fixing and you create a system where that document is destroyed you may have just assisted in the cover-up of an illegal conspiracy.

[Stewart Weltman]

If you mean prophylactic measures to cleanse documents (1) good luck (companies were hard pressed to do so when they had a small universe of hard copy documents and (2) depending on what you cause to be cleansed you could be committing a felony [e.g. obstruction of justice, aiding and abetting etc.]. For example, if an employee writes a memo reflecting that he has engaged in illegal price fixing and you create a system where that document is destroyed you may have just assisted in the cover-up of an illegal conspiracy.

[Stewart Weltman]

If you mean prophylactic measures to cleanse documents (1) good luck (companies were hard pressed to do so when they had a small universe of hard copy documents and (2) depending on what you cause to be cleansed you could be committing a felony [e.g. obstruction of justice, aiding and abetting etc.]. For example, if an employee writes a memo reflecting that he has engaged in illegal price fixing and you create a system where that document is destroyed you may have just assisted in the cover-up of an illegal conspiracy.

[Oscar]

Interesting blog Stewart. Congratulations!!