One of the hallmarks of complex insurance coverage litigation between a corporate policyholder and its insurers is the substantial commitment to – and cost of – pre-trial discovery that is required. And one very large sub-set of that effort and expense is the massive amount of work usually required to locate, identify, and review “arguably relevant” electronic records from a company’s computer systems, networks, voice-mail systems, and computers of individual employees. If you work in the legal department of a company involved with this prospect or are a risk manager or an attorney who litigates cases on behalf of corporations, you have likely been swamped with legions of articles and solicitations about how to deal with discovery of electronic files in civil or criminal litigation or inquiries. It seems that the fairly new rules of e-discovery have created whole new industries virtually overnight..
I will not add to the overload about e-discovery as a simple internet search of that term will yield dozens of articles and links from law firms, accounting firms, and other “e-discovery” consultants that can get you started.
Notwithstanding the deluge of articles and solicitations and offers of “free” training programs, I have found that many companies that do not litigate all that often have yet to learn the ropes. And now, many judges and courts believe themselves to be experts in this field (some are!) and look askance (I am being polite here) when lawyers and their clients either miss obviously pertinent information in their document productions or request or give the adversary so much information that finding the obviously pertinent “stuff” is like looking for the proverbial needle in a haystack.
For those of you who have not yet been initiated and perhaps for others as well, let me provide you with two key pointers to consider before you start down this road. I have not found either of these points mentioned elsewhere.
1. Make sure that the partner who will be leading the litigation on your behalf is experienced with e-discovery. The rules of procedure in the federal courts now require a keen understanding by outside counsel of the entirety of your electronic systems. Although all major lawfirms surely have experience with e-discovery, you may find that many seasoned, intelligent, and highly skilled litigators who are likely to head your litigation are not really computer-savvy and perhaps even have a fear of entering this arena. Yet the strategic choices that will be made with regard to finding the electronic records that need to be located and reviewed will likely cost you tens of thousands or perhaps hundreds of thousands of dollars and need to be made at the top. So do your homework early on.
2. Find out – before you start – whether the lawfirms you are considering retaining have internal rules or practices for handling the e-discovery. The rules of many courts now place a heavy burden on the lawyers and some courts have become very hostile to perceived e-discovery omissions. As a result, some lawfirms require a company to use outside consultants to look for and identify e-documents. Outside consultants generally provide excellent work-product, are trained in tracking everything they do down to the most minute decision, and create a protective buffer against sanctions for the company and its lawyers if something goes wrong (“we told them to find everything”). But outside consultants often can be expensive beyond one’s worst budgetary nightmare. On the other hand, undertaking this effort in-house strains a company’s IT department (if there is one), requires the purchase of now-available off the shelf or, in some instances, custom search software, and places the risk of omission right where it may hurt the most of things go awry. But with proper training and record keeping, undertaking this effort in-house can provide the same quality of service as provided by outside consultants and usually at a fraction (often a small fraction) of the cost. Of course, as you will or at least should be told, the substantially reduced expenditure comes with risk and intrusion on the time of employees that already are fully occupied. No right or wrong answers exists. But you need to evaluate this question before choosing counsel, not after you are in the thick of discovery and told something that you wish you had known before you made your preliminary decisions.
Many more issues arise with respect to e-discovery and perhaps I shall return to them in later posts. But these two points are ones about which your advisors may perhaps be strangely silent.
I will not add to the overload about e-discovery as a simple internet search of that term will yield dozens of articles and links from law firms, accounting firms, and other “e-discovery” consultants that can get you started.
Notwithstanding the deluge of articles and solicitations and offers of “free” training programs, I have found that many companies that do not litigate all that often have yet to learn the ropes. And now, many judges and courts believe themselves to be experts in this field (some are!) and look askance (I am being polite here) when lawyers and their clients either miss obviously pertinent information in their document productions or request or give the adversary so much information that finding the obviously pertinent “stuff” is like looking for the proverbial needle in a haystack.
For those of you who have not yet been initiated and perhaps for others as well, let me provide you with two key pointers to consider before you start down this road. I have not found either of these points mentioned elsewhere.
1. Make sure that the partner who will be leading the litigation on your behalf is experienced with e-discovery. The rules of procedure in the federal courts now require a keen understanding by outside counsel of the entirety of your electronic systems. Although all major lawfirms surely have experience with e-discovery, you may find that many seasoned, intelligent, and highly skilled litigators who are likely to head your litigation are not really computer-savvy and perhaps even have a fear of entering this arena. Yet the strategic choices that will be made with regard to finding the electronic records that need to be located and reviewed will likely cost you tens of thousands or perhaps hundreds of thousands of dollars and need to be made at the top. So do your homework early on.
2. Find out – before you start – whether the lawfirms you are considering retaining have internal rules or practices for handling the e-discovery. The rules of many courts now place a heavy burden on the lawyers and some courts have become very hostile to perceived e-discovery omissions. As a result, some lawfirms require a company to use outside consultants to look for and identify e-documents. Outside consultants generally provide excellent work-product, are trained in tracking everything they do down to the most minute decision, and create a protective buffer against sanctions for the company and its lawyers if something goes wrong (“we told them to find everything”). But outside consultants often can be expensive beyond one’s worst budgetary nightmare. On the other hand, undertaking this effort in-house strains a company’s IT department (if there is one), requires the purchase of now-available off the shelf or, in some instances, custom search software, and places the risk of omission right where it may hurt the most of things go awry. But with proper training and record keeping, undertaking this effort in-house can provide the same quality of service as provided by outside consultants and usually at a fraction (often a small fraction) of the cost. Of course, as you will or at least should be told, the substantially reduced expenditure comes with risk and intrusion on the time of employees that already are fully occupied. No right or wrong answers exists. But you need to evaluate this question before choosing counsel, not after you are in the thick of discovery and told something that you wish you had known before you made your preliminary decisions.
Many more issues arise with respect to e-discovery and perhaps I shall return to them in later posts. But these two points are ones about which your advisors may perhaps be strangely silent.
