Hey Shankapotamous, Read The Rule Book

OK, so last week Craig Ball reported on a  third year law student who asked him what was the minimum amount of e-discovery information he needed to learn in order to get by. And I’m willing to cut a third year law student a little slack because…well, actually, no I’m not and I’m glad Craig held him out for public scorn in his column, I would have published his name.

Why? Because here’s what happens when you those people graduate, pass the bar and start practicing.  The ABA Journal publishes an article about the Pension Committee decision and we get the following two comments:

AndytheLawyer
Feb 23, 2010 7:34 AM CST

And the champagne corks pop at the electronic discovery support vendors’ boardrooms.

JustaLawyer
Feb 24, 2010 9:26 AM CST

Ditto to AndytheLawyer.  Lawyers have ethical obligations to clients, not to Judges who understandably *want* all potential evidence perfectly preserved.  But she never had to manage ediscovery or do so without the power of the government to force people to pay ***ungodly sums of money*** to properly preserve any potentially relevant information.  When Judge SS says she’ll write the check for the capture and processing costs—gee, no one ever mentions that in an opinion—then I’ll be impressed.  I wonder if a federal judge can afford to shell out $250k in preservation or processing costs for each ordinary case that lands in her court.  The ediscovery vendors must be making offers to the banks to buy their private jets off of them.

 Okay, listen up knuckleheads.  You don’t have to pay “ungodly sums of money” to properly preserve evidence. It’s called a document retention policy and if done properly and in a timely manner costs a modest amount and has an enormous ROI. Oh, yeah, and it gets done BEFORE the litigation is filed not after.  Way,  way before.  The amounts Judge Scheindlin is talking about are called “sanctions”.  Look it up JustALawyer. You’ll need to know the term if you ever get in front of one of those judges and spout this nonsense.

ED vendors and corporate jets?  I know a lot of the former and haven’t seen any of the latter. Mostly I find vendors want to work with smart clients which may explain your lack of exposure to them.  Ignorant comments like these are what fuel, well ignorance.  And like most ignorant people, when they don’t know what to do or when to do it, they blame judges and vendors and opponents  …  everyone but themselves. 

And oh by the way, you have ethical obligations to clients AND the court.  Might want to look that one up also JAL.  But be sure your malpractice premium is paid up first.  I’m guessing you’re gonna need it.

More On Litigation Holds

The debate on Judge Scheindlins decison in the Pension Committee case is now in full swing.  Several public comments have decried the overly high standard set by the decision, with George Socha summarizing the common sentiment when he said on the LitSupport listserv:  “If one were to attempt to apply the standard set forth at pages 24 and 25 of the Pension Committee decision to the practices followed by most lawyers handling most lawsuits, I suspect that one would have to conclude that well upwards of 90% of attorneys handling lawsuits are committing gross negligence.”

I agreed with many of the statments George made about the decision. Shortly after his post, I responded with the following: 

George said:

Many of the tools aimed at assisting with legal holds are less than three  years old – hardly the sign of a mature, developed and stable market.
I think you’ll see that change quickly … I saw several new lit hold app vendors at LegalTech and have heard from at least two existing vendors that they are working on a lit hold app

There is no broad agreement on processes to use
This is where I think we need to make progress, not at the tool level .. protocols, principles, processes, best practices …whatever we call them
this is what we need to develop

But with regards to the 90% quote I responded:

Well the same could be said about police departments the day after the Miranda decision … altho the FBI by that time had already developed its own Miranda-like statement that they read to suspects being arrested.  Some people see the writing on the wall, some people don’t. Changing to meet judicially imposed standards is what we do, even if it’s difficult or unpleasant.

Really, if you boil the decision down to it’s basic requirements, what Judge Scheindlin says is you must send written legal holds to identified individuals and take ongoing and proactive steps to ensure compliance by those people. Is that really all that onerous?

In fact. most IT staff I speak with say then easily do that … if they are asked to do it.  So once again we circle back to education … perhaps the process isn’t being undertaken not because it’s incredibly difficult but because the attorneys don’t know the right questions to ask.  After all, as Judge Scheindlin points out,  all that is necessary to meet the stanadard is a reasonable, good faith effort.

I’lll repeat a paragraph I closed with in a post several months ago. It still seems strikingly appropriate:

What the question really shows is the complete disdain attorneys have for litigation support professionals. I mean come on now, would that same attorney ask why his IT or secretary couldn’t draft a Motion for Summary Judgement or a restraining order? The fact is most attorneys think if you don’t learn it in law school it isn’t professional and anyone should be able to do it.  Which is why first associates fresh out of law school in New York or Chicago or LA make 2-3 times much as IT and lit support professionals with 10-15 years experience.  And why Michael Arkfeld continues to say that 95% of the attorneys in the country don’t understand ediscovery at all

Litigation Holds Are Mandatory Not Optional

I’ve had several new engagements in the past 6 weeks and in each case I’ve been surprised to learn that the new client does not have a mandatory litigation hold policy. Rather, they assess each case as it comes in and decide whether or not to issue a litigation hold.  This rather casual attitude towards litigation holds strikes me as an echo of the words of Judge Shira Scheindlin in Pension Committee of the Univ. of Montreal Pension Plan, et al., v. Banc of America Securities, LLC, et al.  (“Pension Committee”), when she said that litigants are still conducting electronic discovery in an “ignorant and indifferent fashion.”

So let’s take a look at the requirements for a litigation hold and where they came from. First, let’s keep in mind that the obligation to preserve evidence began well before the ED rule changes in 2006. First, as Judge Scheindlin points out in Pension Committee,  “The common law duty to preserve evidence relevant to litigation is well recognized.”  And Judge Scheindlin herself set the modern standard for litigation holds two years before the rule changes. In Zubulake V, issued in 2004, she specifically held that counsel MUST issue a litigation hold when litigation either commences or is reasonably anticipated and further that the hold must be communicated clearly to key players who have relevant information under their control and that those players should be periodically reminded of the preservation duty.

Although the 2006 rule amendments did not codify this position, it was endorsed in a 2007 Sedona Conference commentary, has been cited in numerous court decisions, both state and federal (cf, Synventure v Husky, 2009 U.S. District Lexis 105306 (D. Vt. Mar. 13, 2009)) and is being incorporated by the most recent state rule changes, notably the California Electronic Discovery Act of 2009.   And now Judge Scheindlin has returned to the issue with her ruling in Pension Committee.

And she makes it quite clear. The duty to preserve is a duty, not a choice.  The failure to adequately preserve documents will cause spoliation and that equals gross negligence. The failure to issue a written litigation hold equals gross negligence.  The failure to suspend routine document retention and/or destruction policies as part of a litigation hold will equal gross negligence.

You MUST do the following according to Judge Scheindlin:

      1. Identify all key players

      2. Issue them a written litigation hold

      3. Ensure that no records are destroyed

      4. Cease deletion of any and all relevant email

      5. Preserve the records of any former employees which may be relevant

      6. Preserve backup tapes if they are the only source of any relevant information

      7. Reissue the litigation hold on a regular basis to ensure compliance

Failure to take these steps may result in sanctions including the allowing of further discovery, cost shifting, fines, special jury instructions, preclusion of evidence and default judgement or dismissal.

I strongly urge all attorneys and their corporate clients to read the Pension Committee decision and familiarize yourself with it’s findings.  They are not just suggestions, they are requirements.

TakeAways from Legal Tech New York

Here’s my two main impressions after looking back at the Legal Tech event this year.  The first is the obvious trend my hosting companies toa dd more features which can distinguish them from the competition. Analytic tools, intelligent search engines, easier folder setups, better user interfaces, partnerships with other service companies: all of this tells me that hosting has finally been accepted and now the challenge is to provide more than simple “electronic Iron Mountain” basic storage.

Service will be king in the hosting arena this year and watch for even more competitive pricing as the demand for these services increases throughout the year. I also expect to see more integration with cloud based case management systems and more intelligent search engines, in a manner consistent with the new search protocols we saw at the show from West and Lexis.

And along the lines of product differentiation, I also expect to see more independent analysis of software products. Sean Doherty of Law.com mentioned in his column LegalTech New York: Thats’ A Wrap, that Legal Relay is a product to watch.  This online forum for reviewing and rating software and services is based on on user-generated content although vendors can pay a premium to post product information. This combination will make LegalRelay the “Amazon reviews for legal technology,” says president and founder John Gilman.

The second trend I saw in e-discovery was the increasing appearance of the  flat-rate per document pricing model. I has seen this approach last year in several project bids and it was usually a thinly disguised attempt by major vendors to low ball or even give away collection and processing in order to land the hosting and review of a project. But now smaller vendors are embracing the concept and I saw at least four companies at Legal Tech offer this price model.

My major concern here is that if the document population changes radically during the project and the vendor finds itself in a position of having underbid the cost based on that shift, there will be  a push to get documents reviewed quickly and not necessarily accurately in order to maintain an acceptable  profit margin.  Now this can be handled by specific price structuring that provides for floating costs based on regular project reviews of the document population but I am still somewhat troubled by attempts to “guesstimate” document levels at the beginning of a project.

Still, what is clear is that more competitive pricing, not just in levels of pricing but types of pricing, is here to stay as vendors move to compete much more aggressively for available work.  And this can only be good news for firms and legal departments as they work on litigation budgets.

LegalTech New York A Big Hit

Crowds at LegalTech were still heavy on day three.  Excellent educational content was driving heavy attendance at the sessions .. I arrived five minutes late for a panel featuring Craig Ball, George SOcha and Ralph Losey and couldn’t even get into the room as it was beyond SRO into WRO, Waiting Room Only.

Browning Marean and I were once again in the ED Zone, interviewing Atty. Maura Grossman from Wachtell  about litigation holds and the new decision from Judge Sheindlin in the Pension Committee case. The TechLaw Solutions booth was buzzing with onlookers as the three of us discussed lit hold implementation, document collections in foreign countries and all things ED.

Litigation hold applications were in abundance as were several new inexpensive forensic collection tools and a variety  of  analytic tools for early case assessment.  And attendees strolling the exhibit hall could meet and chat with ED luminaries such as Craig Ball, Michael Arkfeld, George Socha, Judge Ronald Hedges, Mary Mack  and even the seldom seen Bill Speros. 

Also spotted were document assembly pioneer Jim Eidleman and Roger Miller of El Paso, owner of Altep, one of the earliest lit support vendors in the country.  And spotted all over the show floor was Monty Lunn of the Alchemy Group telling everyone about the first annual Green Legal Matters Symposium being held in New Orleans on April 27-28.

The mood was decidely upbeat as attendees were optimistic about a gradual turnaround in the business climate. And of course today I had to wear my Saints jersey and give a shoutout to the Who Dat  nation.

One of the mysteries of the show, however, were the constant tweets from The Fake Tom O’Connor. Depsite numerous questions, I can assure you that it was NOT me tweeting under that name and the actual identity of TFTO is still unknown.

I’ll recap the trends and issues of the show but right now I’m off to JFK to catch a flight home.

Reporting Live from Legal Tech New York

I’m reporting live from the ALM Editors Breakfast at LegalTech New York.  All the ALM journalists, editors, bloggers and writers in attendance are here introducing themselves and mingling with attendees. Some of the names you may recognize include Monica Bay, Craig Ball and Bob Ambriogi and I just had a most pleasant conversation with Gabe Acevedo and Mary Mack.

I arrived in New York in time for the TechnoLawyer dinner Sunday evening.  It was well attended and I saw many old friends including Yui from CaseLogistix. Monday morning I began a series of speaking engagements for the day and made only a brief visit to the exhibit hall but when I did the rooms were crowded and booths were filled with attendees.

Monday evening was the LTN Awards dinner which saw Craig Ball receive the Consultant of the Year award and Tom Burke, founder of Worldox, receive a Lifetime Achievement Award.  Legal luminaries such as Michael Arkfeld, Neil Aresty and Andy Adkins were in attendance and after the “dinner” many of us adjourned to the nearby Stage Deli for heaping amounts of pastrami and  cheesecake.

I’ll be in the exhibit hall most of the day today meeting with folks and talking to vendors so I’ll do a detailed report on that experience later today.

Judge Scheindlin Revises Order In Pension Committee v. Banc of America Securities

Ralph Losey just broke the story that Judge Scheindlin yesterday entered an Amended Order in her landmark decision on spoliation and sanctions in The Pension Committee of the University of Montreal Pension Plan, et al. v. Banc of America Securities, et al.  Ralph had a lengthy blog on the case on January 17th and then wrote a post on EDD Update yesterday, the 18th, when he learned of the revision.
You can read Ralphs posting on his blog, The E-Discovery Team  (which has been revised to incorporate the changes in the Amended Order) or go to a copy of the actual Amended Order here. 

ECA Redux

Last fall I hosted a webinar on Early Case Assessment (ECA) that was sponsored by Anacomp and featured  a discussion betweeen veteran legal technology consultant Chuck Kellner (the Vice President for eDiscovery Consulting at Anacomp) and Chris Smith (the Senior Product Manager at Anacomp).  The discussion (which is available for lsitening or download on the Anacomp web site) centered on how ECA can empower law firms and corporate counsel to gain initial case insights and determine optimal strategies which they can leverage to slash ediscovery time, costs and risks.

The premise of the discussion was that the ability to gain early insight into the facts of a case, determine case strategy, and predict, control and minimize time, costs and risks is crucial to effective handling of any matter. With that in mind, Chuck and Chris discussed several key points in developing an ECA strategy including:

  • Utilizing defensible search methodologies to reduce the volume of electronically stored information (ESI) required for review.
  • Making smart, budget-conscious decisions about what to review and how to negotiate the scope of data discovery.
  • Reducing unnecessary capital expenditures and eliminate spends typically made under tight deadlines or resource constraints.
  • Bringing predictable, reasonable costs to electronic data discovery processes

But what has become apparent in discussions I’ve had since that webinar is that ECA is considered the “Holy Grail” of the litigation processs and thus means different things depending upon the person attempting to define it.  So let me repeat the caveat I give to my clients when discussing ECA.  It’s a process not a product.

There is no ECA silver bullet. It can’t be addressed solely by a software solution. Instead, approach ECA as a process, and leverage the right combination of consulting services and proven technologies to develop the best workflow for your case.  As my old friend Browning Marean, Senior Counsel and co-chair of the Electronic Discovery Readiness and Response Group at DLA Piper, says: “The ability to gain early insight into the facts of a case, determine case strategy, and predict, control and reduce costs is exactly what law firms and general counsel departments are looking for.  A vendor’s strategy of approaching ECA as a process, and offering the right combination of consulting services enabled by proven technology should be the right one for addressing these challenges and differentiating itself from other providers in the marketplace.”

We’ll be doing another webinar on exactly this point later in the month and at the same time releasing a white paper to discuss these points. Look for specifics on date and time later this week.

Example of EDiscovery Cheaper Than Paper

Here is a great example of how the judicious use of technology can make e-discovery of data cheaper and faster than the tried and true paper paradigm.  This LitSupport listserv post comes from Paul Engel, the President and CTO of VeBRIDGE in Lexington, KY.  Paul ish well known in Summation circles as a top notch litigation technology consultant and this examplar is extremely informative.

This is an interesting thread. I do a presentation on “EDD Gotchas” and include a quick comparison of an e-discovery job we did a few years ago w/ its equivalent hard-copy conversion

The EDD job was 12GB of data. It was pre-culled, so the filtering and de-duping ended up eliminating 15% of the emails and only 4% of the e-docs. The job was completed in a couple of days and resulted in 105K emails out of 124K in the repository, and 71K e-docs out of 74K on the produced hard drive. Since it was EDD, the output was 100% text searchable and fully meta-data coded…all 1.3 million pages. The cost was under $9K.

Pricing the same job in the old days of paper, it would have cost couple hundred thousand (including full bibliographic coding), and the OCR would have resulted in an accuracy of between 70% and 90%. (Before we debate this number…even in a highly competitive market, the cost would have exceeded $100K.) PLUS, in the absence of de-duping and filtering, over 160,000 pages of evidence would have had to have been reviewed. At low paralegal costs and assuming a couple hundred pages per hour, that would have cost the client an additional $60K.

How soon we forget! The sticker shock comes from the physical miniaturization of the content. Looking at over 500 stacked boxes makes $200K seem reasonable. Looking at 3 DVDs makes $9K seem outrageous!

Oh … I forgot to mention the turnaround time would have been weeks or months instead of hours!

Is E-Discovery Too Expensive?

There has been a fascinating thread on the Lit Support ListServ this week that was started by the following post.  “Why is EDD and Data Processing So Expensive, why can’t IT or my secretary do this ? I know that we have all been faced with this so I am wondering if anyone  can point me to a few good references, as I want to write a document that the average person can read and understand. This will help from having to explain this 300 times a year.” 

The answers have ranged from the comically brief:  “It runs on magic, and magic is expensive.” and  “Why should lawyers get to make all the money?” to the concise and erudite answer posted by George Socha: 

“First: ‘Why is EDD and Data Processing So Expensive?’: Processing ESI can be expensive because consumers demand that the work be done very quickly and with a high degree of accuracy and reliability, in conditions where it may well be that at the outset no one knows the scope of the undertaking or the complexities and challenges to be encountered along the way. Prices vary greatly, at least in part because ³processing² means many different things. Prices have dropped considerably; as a result, however, there now is the danger of consumers paying such a low price that providers end up cutting too many corners, with a drop in quality that may not be acceptable.
But really to me the query seems to beg question, “what is ediscovery”?   A good answer to that question can be found at Ralph Loseys blog this week but it would seem to me that anyone who truly understands what ediscovery is would know that the answers to the list serv post are 1. It isn’t too expensive if done properly and 2.  Because you need special training.

Second: “Why can’t IT or my secretary do this?’ If IT or your secretary has an acceptable level of expertise and experience and is provided an
acceptable level of resources, then IT or your secretary can do the work. One is not able or unable to handle the challenges of dealing with ESI
simply because of the name of one¹s employer or the title of one¹s position. An organization does not magically become qualified to engage in electronic discovery activities simply be calling itself an electronic discovery provider, nor is an organization automatically disqualified simply because it is a law firm or a client. Rather, it is a question of expertise, experience, resources, and the like.”

 What the question really shows is the complete disdain attorneys have for litigation support professionals. I mean come on now, would that same attorney ask why his IT or secretary couldn’t draft a Motion for Summary Judgement or a restraining order? The fact is most attorneys think if you don’t learn it in law school it isn’t professional and anyone should be able to do it.  Which is why first associates fresh out of law school in New York or Chicago or LA make 2-3 times much as IT and lit support professionals with 10-15 years experience.  And why Michael Arkfeld continues to say that 95% of the attorneys in the country don’t understand ediscovery at all.