By Julia Romero Peter, Esq.
The Federal Trade Commission and International Trade Commission recently have revised its ediscovery rules. Both sets of rules aim to expedite the ediscovery process, ease discovery burdens and clarify privilege procedures.
FTC’s Revised Rules
On November 9, 2012, the FTC’s revised rules on ediscovery went into effect. These rules cover the compulsory process (16 C.F.R. §2.7), privilege claims (16 C.F.R. §2.11) and the duty to preserve information (16 C.F.R. §2.14(c)).
Rule 2.7 authorizes the Commission to issue a subpoena or CID ordering the recipient to testify or produce relevant material regarding a matter under investigation. Electronically Stored Information (ESI) is defined as “any writings, drawings, graphs, charts, photographs, sound recordings, images and other data or data compilations stored in any electronic medium from which information can be obtained either directly or, if necessary, after translation by the responding party into a reasonably usable form.” This includes metadata.
Rule 2.7 also requires a respondent to meet and confer with Commission staff “within 14 days after receipt of process or before the deadline for filing a petition to quash, whichever is first, to discuss compliance and to address and attempt to resolve all issues.” Any privilege issues likewise should be raised with the Commission.
Rule 2.11 describes the specifics for withholding privileged material. Privilege logs must be provided in a searchable electronic format and contain certain information.
Rule 2.11 also states that an inadvertent disclosure does not act as a waiver if the disclosure was inadvertent and the privilege holder “took reasonable steps to prevent disclosure” and “promptly took reasonable steps to rectify the error, including notifying Commission staff of the claim and the basis for it.” The Commission must “promptly return or destroy the specified material . . . .”
Finally, Rule 2.14(c) provides that a respondent is relieved of its duty to preserve relevant information “after a period of twelve months following the last written communication from the Commission staff to the recipient or the recipient's counsel . . . .” This does not remove any obligation of respondent to preserve information for other investigations or litigation.
ITC’s Revised Rule
On May 15, 2013, the International Trade Commission revised its ediscovery rule related to Section 337 investigations (19 C.F.R. §210.27). The rule will be effective 30 days after publication in the Federal Register. The revisions bring the rule more in line with Federal Rule of Civil Procedure 26(b). Generally, the revisions limit discovery when unduly burdensome or costly and address privilege issues.
The first revision permits a party under certain circumstances not to produce requested ESI if it is “not reasonably accessible because of undue burden or cost.” It also requires an administrative law judge to limit discovery if it is duplicative or “can be obtained from a less burdensome source” or where “the burden or expense of the proposed discovery outweighs its likely benefits.”
The ITC revisions on privilege claims describes a “uniform set of procedures” for making privilege claims. Claims must be “expressly” made when a party responds to a discovery request. Moreover, privilege logs must be produced within 10 days of making the claims. The ITC “believes discovery will be most efficient when relevant privilege and work product issues are identified as soon as possible.”
The revisions also describe procedures for addressing inadvertent disclosures. Administrative law judges will need to apply federal and common law when deciding on the consequences of inadvertent disclosures, including whether the privilege holder “took reasonable steps to prevent disclosure” and other factors set forth in Federal Rule of Evidence 502.
In summary, the FTC stated that its foregoing revised rules “will streamline the FTC’s investigatory process [and] make updates to keep pace with electronic evidence discovery . . . .” As a policy, the FTC stresses cooperation and “expects all parties to engage in meaningful discussions with staff to prevent confusion or misunderstandings . . . .” Similarly, the ITC enacted its revisions with the hopes of cutting costs, decreasing discovery burdens and disputes and expediting resolution of Section 337 investigations. It remains to be seen whether these hopes will come to fruition.
The knowledge and content management magazine KMWorld listed Relativity, an eDiscovery platform developed by kCura, as a trend-setting product of 2012. But Relativity is more than a trend. This software has become a game-changer and labeling it as a trend elicits an impermanence that undermines the credit this product deserves. Like the Ford Model T or the Internet, Relativity is establishing a precedent for the new era of eDiscovery.
Even though this product has over 75,000 active end users, including the U.S. Department of Justice and 95 of the top 100 law firms in the U.S., according to KM World, Relativity still remains relatively unknown. Relativity is a web-enabled discovery software aiding in the processing, review, analysis, and production of electronic documents.
This is a revolutionary application that manages terabytes of data while simultaneously allowing users to customize a database for their needs. Specifically, this application allows an unprecedented efficiency with control in the hands of the user.
Joseph Cusumano, a litigation support manager at Kasowitz Benson Torres & Friedman, says the upgrades moved more of kCura’s powerful features into litigation support’s control. "'We can quickly reallocate optical character recognition, production, and TIFFing without having to involve our IT administrators. That’s really what raised my eyebrows,'" he says in the article. With kCura devoting itself to continuous evolution offering a groundbreaking product that stands on its own, it’s clear to see while certainly being trendsetting is complimentary, it just doesn’t do it justice.
TERIS is a premiere partner of kCura with certifications in every Relativity module kCura offers. In fact, the same company that was responsible for developing the IT model for kCura Relativity designed the Relativity infrastructure for TERIS. The combination of TERIS’ Relativity Best in Service designation, along with the powerful benefits of Relativity, provide clients with more flexible workflow capabilities, making the platform stronger, faster, and even more powerful.
by Greg Behan, Esq.
A technical committee of the International Organization for Standardization (ISO) is moving forward with the development of standards for legal discovery involving electronically stored information (ESI). Previously, the committee generated international standards guidelines for the identification, collection, acquisition, and preservation of digital evidence with the goal of creating an impartial global mechanism for investigations involving digital devices and digital forensics. The ISO has created international standards for a diverse range of industries including food safety, healthcare, computers, finance, energy, automotive and service related products to name just a few. Their standards carry the weight of law in many jurisdictions and the scope and reach of the organization has helped to normalize global commerce.
The ISO committee's co-editor and U.S. representative is Eric Hibbard who is also Co-Chair of the American Bar Association’s E-Discovery & Digital Evidence Committee and CTO for Security and Privacy at Hitachi Data Systems. Hibberd’s committee elected to move forward with the development of E-Discovery standards during a meeting in France hosted by the European Telecommunications Standards Institute. Joining the United States in support of the creation of these international standards were the United Kingdom, Thailand, Belgium, Brazil, China, the Czech Republic, Mexico, Norway, the Republic of Korea, Romania, Singapore, Slovakia, Slovenia, Italy and South Africa.
There are several U.S. institutions that have provided guidelines and recommended the adoption of technical standards for the production of ESI. In the past, there has been concern that technical standards may be premature given the continual advancement in technology and the ever changing litigation software landscape including the increasingly more common use of Technology Assisted Review (TAR) workflows. Depending on the dataset and the software tools utilized, a standardized process may inadvertently confer an advantage to one party over another. Just like any other industry, if international standards are adopted some firms will need to re-tool their processes in order to comply when working across international borders.
In order to control costs, large multinational corporations are becoming increasingly involved in the discovery process and will likely require law firms and vendors adhere to protocols developed by standards organizations like the ISO. This type of standardization will indicate that their company is purchasing services from a qualified source and will create metrics against which expenditures can be measured and analyzed to determine efficacy. Non-technical judges increasingly rely on standards organizations to make decisions related to eDiscovery issues and a set of recommendations by a renown institution like the ISO will certainly carry weight for any firm or business that relies on them before the bench.
1 http://meetings.abanet.org/webupload/commupload/ST203001/relatedresources/EDDE_JOURNAL-volume4_issue2.pdf Page 14
When the world of eDiscovery was young, it made sense to charge per gigabyte, much as a laundromat charges per shirt. Although the presence of electronic data, devices, and storage were becoming increasingly prevalent in daily life, the litigation industry was a bit slow to catch on at first, and the per-gigabyte pricing model stuck around.
The Wave of the Future
These days, what used to be a half-dozen shirts dropped off at the cleaners has become an entire bushel.
According to the International Data Corporation, the total amount of worldwide digital content created in 2010 exceeded one zettabyte, the highest volume of data ever recorded in history. And yet, that number is predicted to double by the end of this year. If imagining every byte as a single grain of sand, the total data created would encompass 400 Hoover Dams.
If you can imagine sifting through even a fraction of those grains of sand for data relevant to specific litigation, it becomes clear why the old usage-based pricing models no longer make sense. The clamor from clients for more reasonable and predictable cost structures has become deafening, while legal teams are frustrated at the lack of an industry-standard alternative. Meanwhile, total litigation costs are rising everywhere, and the exorbitant (yet vital) electronic discovery costs are largely being blamed.
The world has changed, especially where technology is concerned. Remember when emails weren’t considered admissible evidence because they were too informal? Courts took a long time to recognize electronic data as valid. These days, corporate communication via emails can form the entire foundation of a case. While the courts are finally embracing many aspects of technology, one area remains stubbornly set in outdated ways: existing pricing structures for eDiscovery. Is it time to leave usage-based pricing behind? Can the idea of alternative fee arrangements (AFA) finally bring eDiscovery costs into the twenty-first century where they belong?
History of Existing Price Structure
Historically, the idea of alternative fee arrangements was limited to single-service solutions. Clients would pay one subcontractor for computer forensics and another for data mining, while hiring yet another for electronic discovery. All the services were separate, and paid for separately, according to usage. Again, when the amount of data was so much smaller, this method was completely reasonable.
Multi-service solutions started being offered to allow clients a one-stop solution for their litigation support needs. However, though the offered services themselves had changed significantly, the pricing structure never did. Despite the advantages gained to both parties by adapting a multi-service approach to eDiscovery and other technologically-based litigation support, the billing remained based on usage, not service.
At a small level, usage-based fees make sense, and are very attractive to clients. After all, you only pay for the information you harvest and the specific services used. Clients feel confident that they’re not being overbilled, and might even feel like they’re saving significantly over the more standardized prices associated with alternative fee arrangements.
For minor litigation, they may even be right. What happens, though, when the litigation isn’t minor? Litigation, by its nature, is pretty erratic. One month a firm may only need $10,000 worth of electronic discovery services; the next month, a huge and unexpected case may push them into 20 times that amount. With no predictability comes a disastrous attempt at budgeting, or more accurately, the impossibility of either maintaining or predicting said budget. Any savings that seemed worth cheering over on the usage-based model go right out the window with just one complicated lawsuit.
The high costs don’t only impact the client, either. As with any company, higher operating costs from litigation support are passed on to the client as higher fees. Yet, in the months or years when there’s a lull in the action, the same teams may be struggling to stay in business due to lack of revenue.
The level of havoc wreaked on client electronic discovery budgets and counsel operating budgets next led to a market push toward retainer-style pricing systems. Much like retaining counsel directly, an upfront fee is paid in exchange for exclusivity. This structure, though an improvement in some ways over usage-based pricing, too easily leads to client overpayment and frustration, combined with provider undercharging for actual support efforts. A better solution is needed, and soon.
Read the rest in our free white paper:
by Greg Behan, Esq.
“Once a new technology rolls over you, if you’re not part of the steamroller, you’re part of the road.”
The information substructure of society—the way information is captured, shared, and communicated[i]—is evolving at an exponential rate and most institutions are not prepared to adapt to this rate of change. Realistically, who can blame them when the annual data volume generated by U.S. corporations is enough material to fill 10,000 Libraries of Congress?[ii] Just to put that statistic into perspective, the Library of Congress is the largest library in the world and contains 838 miles of bookshelves.[iii]
Generally, Moore’s Law describes how the processing power of hardware has exponentially increased every 18 months since the creation of the integrated circuit in 1958.[i] However, only recently have technologies evolved that enable us to make sense of the huge data volumes generated by this processing power without the necessity of hiring armies of human beings to manually review and categorize this information. Richard Susskind describes this phenomenon as Technology Lag, the difference between data processing and knowledge processing - the ability to make and move data vs. the ability to analyze and interpret it.[ii]
(Image Caption: The opportunity of a lifetime: meeting Stewart Brand, renown futurist, editor of The Whole Earth Catalog, and founder of the Long Now Foundation, Global Business Network, and The Well.)
The data revolution in the legal industry is barely getting started, and already the Technology Lag is rapidly shrinking. Technology has disrupted nearly every industry, making many professions obsolete (think travel agents, telephone operators, and photographic lab technicians), and lawyers are not immune to this disruption. I’m a member of Generation X and even though I owned a computer when I started my first job as an Assistant Prosecutor, I was handed a Dictaphone (yes, I know) by an older colleague to dictate motions for transcription.
After I stopped practicing criminal law, I moved to Washington, D.C. and began working on large document reviews, some with hundreds of lawyers per case. As the review technology improved, and the technicians implementing it began to unlock the functionality of the software, the giant rooms filled with lawyers coding documents began to shrink. Within a few years a review project that once needed 400 lawyers could be performed with the labor of only 50. Today, the same type of complex project requires just a handful of lawyers/Subject Matter Experts (SMEs) and a sharp technician that understands and can leverage the power of the software. At this rate of advancement, what might we expect just a few short years from now?
Technology Assisted Review (TAR) will redefine the rules of discovery, the law firm business model, and even the nature of evidence itself in ways we will be unable to predict. While this technology has been around for several years, demand for it is starting to grow and soon we will see more cases related to its use and implementation. Lawyers are wired to rely on the past for guidance in the formulation of legal arguments based on precedent. This mentality can be limiting because there are no legal insights from the past that are capable of accommodating the emergence of machine / human legal determinations. This is uncharted territory and we are likely to see the momentum for adoption oscillate between skepticism and acceptance. Ultimately, the technology will be adopted widely and the firms who get there first will have an advantage with their clients in the 21st century legal market.
So, ask yourself this – are you familiar with these terms: Probability Theory, Statistical Sampling, Overturns, and Feedback mechanisms? If not, you may be “part of the road”…
 Susskin, Richard. The End of Lawyers, Rethinking the Nature of Legal Services. Oxford: Oxford University Press, 2008. Digital print.
 Susskin, Richard. The End of Lawyers, Rethinking the Nature of Legal Services. Oxford: Oxford University Press, 2008. Digital print.
It's no secret that the use of social media has skyrocketed. In 2012, according to Burson-Marsteller, eighty-seven percent of Fortune Global 100 companies used some form of social media. In 2009, more communications occurred via social networking sites than e-mail.
Increased use has created a plethora of information that quickly has become a highly-desired source for discovery. Gartner predicts that “[b]y the end of 2013, half of all companies will have been asked to produce material from social media websites for e-discovery.”
With respect to admissibility, social media information is treated the same as other forms of electronically-stored information. Among other factors, it must be authenticated and relevant.
Authentication of Social Media Data
Authenticating social media evidence raises particular issues; including false profiles, account hacking and “Photoshopping.” These issues may be offset by the electronic footprints inevitably left by social media users, however. Forensic examination of devices or corroboration by social media sites may provide a panoply of authenticating data points; including identifying the location of the post, the device or application from which the post was made, timestamps, user IDs, handles, usernames of re-posters, account IDs, recipients of a post and associated links. Key to this inquiry is engaging a partner who can provide the necessary forensic support.
Discoverability of Social Media Data
It is now well-established that social media data may be discoverable if it is relevant. If a user shares information publicly, e.g., via public postings or prior disclosure; it may be discoverable. On the other hand, private messages that are made on a social media site may be protected. Courts diverge on the scope and manner of disclosure.
In Crispin v. Christian Audigier Inc., 2010 U.S. Dist. Lexis 52832 (C.D. Cal. May 26, 2010), the court noted the distinction between private messages and postings and comments on a “wall”. Here, the court protected private e-mail messages made via Facebook and MySpace, because the Stored Communications Act, part of the Electronic Communications Privacy Act of 1986, applied. But the court remanded the issue of whether the user’s privacy settings made his postings and comments “public” and accordingly not shielded by the Stored Communications Act.
In EEOC v. Simply Storage Mgmt.., LLC, 270 F.R.D. 430 (S.D. Ind. May 2010), the court pointed out that the users’ expectation of privacy in using their Facebook and MySpace accounts did not protect communications made via those sites from discovery. The court noted that the users had “already shared” the information at issue. The court ordered production of the following communications relevant to the case: “any profiles, postings, or messages (including status updates, wall comments, causes joined, groups joined, activity streams, blog entries) and SNS [social networking sites] applications for claimants . . . .”
Preparation for Discovery
With social media data on the rise, corporations and counsel should take steps to address and prepare for certain unique issues:
Act early -- users constantly update and change data as well as privacy settings.
Determine whether relevant information resides on social media sites, weighing the costs of obtaining such information.
Use discovery requests to determine all social media sites used by the opposing party and request all relevant postings and messages.
Consider the steps necessary to authenticate the requested information, including engaging a trusted partner to provide forensic support.
Engage a trusted partner who can preserve, collect, review and produce the information in a defensible manner.
Implementing an effective information governance strategy is one of the ways an enterprise can help protect itself against potential litigation. And yet, according to some recent surveys, many organizations remain either ignorant or unwilling to adopt a wide-reaching internal information governance strategy.
Download our newest white paper and learn important tips and developments in this area, including:
- How to reduce risks
- eDiscovery responsibilities
- Social media guidelines
- Key court case studies
- Future implications
Although it’s tempting to brush this responsibility ‘under the rug,' failing to assess your information governance needs appropriately can lead to liabilities, sanctions, and significant and costly penalties.
Click below to download your free copy today!
By doing your research upfront, you can deal with e-discovery without breaking your budget. There are a number of ways that you can cut costs and avoid significant financial set back. Below are nine tips that can help you save money - while still meeting all of your e-discovery needs and responsibilities.
- Streamline your e-discovery operations.
- Pare your procedures down to what is absolutely necessary. Sometimes with e-discovery, services or products might appear necessary initially, but prove to be superfluous upon more closely looking into the process.
- Become familiar with your options
- To find the most effective ways of handling ESI and electronic discovery procedures, you should familiarize yourself with the technology and processes available. You can acquire this familiarity by browsing through Internet articles on the subject, following blogs, and perusing the websites of service and product providers.
- Consult experts
- In the long run, it might prove better to seek the advice and expertise of a professional rather than taking the risk by handling e-discovery matters yourself. You could find that you've overlooked a particular electronic discovery need or that you've purchased a piece of software or equipment that doesn't properly meet your needs.
- Understand the process and how it relates to your needs.
- This is another aspect of electronic discovery that often takes a lot of research. Knowing the e-discovery process and applying it to your unique situation will help you make more informed decisions when purchasing services and/or solutions.
- Divide and conquer
- Leverage the combined knowledge of your firm by holding a meeting to deal with the electronic discovery issues at hand. Assign stakeholders research duties into particular solutions and products, become knowledgable and share the knowledge among the team.
- Keep up with the news and note electronic discovery changes
- Electronic discovery and ESI are still somewhat new and developing procedures, and rulings and regulations regarding electronic discovery are still changing on a regular basis. If you want to minimize your electronic discovery costs, it is imperative that you are aware of any new development in electronic discovery so you can discontinue a function if you no longer are responsible for it.
- Listen to your IT staff
- The team who best understands electronic discovery and the demands it places on your firm might just be your IT staff. They will be familiar with searching for data in your firm's computers and they will be able to critique a package of e-discovery software on its merits and flaws.
- Determine the best production format for your situation
- When you are in position to dictate the production format, consider which is best. You may be most familiar with one to two types of formats – but there are other options that can result in efficiencies and savings.. Weigh the pros against the cons and go with the option that gives you an advantage.
Although electronic discovery can place a burden on a firm, there are many ways to reduce costs and simplify the process. Being vigilant and putting sufficient time and effort into researching the possibilities can help you find affordable and practical electronic discovery solutions. The tips explained above are just some basic ways to save time and money in electronic discovery – but there are obviously many others.
Make no mistake, today’s e-discovery environment is complex and rapidly evolving. Without the right vendor, performing e-discovery services can be a costly and risky venture. But partnering with a trusted, sophisticated litigation support provider that specializes in e-discovery services can turn a risky venture into a smooth process.
Change Is the only Constant: Don’t Be Left Behind.
The e-discovery market is constantly changing. Every year, there is a new a class of e-discovery technology focused on addressing some section of the EDRM. These technologies can become outdated quickly. Case in point, judges have accepted technology-assisted review of data only recently. See Da Silva Moore v. Publicis Groupe, Civ. No. 11-1279 (ALC)(AJP), 2012 WL 607412 (S.D.N.Y. Feb. 24, 2012); Global Aerospace, Inc. v. Landow Aviation, L.P., Case No. CL 61040 (Vir. Cir. Ct. April 23, 2012); In re Actos (Pioglitazone) Prods. Liab. Litig., 2012 WL 3899669 (W.D.La. July 30, 2012). But it is anticipated to become the norm quickly in 2013.
Invest in an expensive limited solution in-house, you may end up with quickly outdated and unsupported technologies. Partner with an e-discovery vendor who uses cutting-edge e-discovery technology and knows the ins and outs of e-discovery services, save your capital investment and the time and effort otherwise spent in constantly trying to optimize it.
In-Sourcing May Be Inefficient and Expensive.
In-sourcing expenses add up quickly. Starting an in-house e-discovery department includes the time and expense of finding, training and attempting to keep qualified employees; purchasing or leasing equipment and consistently updating your chosen e-discovery tool -- not to mention spending a considerable amount to license it. You also will need to improve your equipment to keep pace with the latest e-discovery technology requirements. All this for a service you may not even use on a consistent basis.
With outsourcing, you only pay for e-discovery services when you need them. Moreover, vendors offer alternative fee arrangements that may help keep down litigation costs.
It should be noted that a majority of law firms and corporations, at the very least, outsource data hosting. With its concomitant installation, maintenance and security issues; firms do not have the bandwidth nor the resources to deal with the hassles of data hosting.
Outsourcing Leverages E-Discovery Expertise . . .
E-discovery services are technical and require expertise and know how. At a trusted vendor, highly-skilled e-discovery specialists perform e-discovery work every day and have seen and solved the gamut of e-discovery issues. Last year, most e-discovery sanction cases resulted from corporations committing errors resulting from their inability to deal with voluminous data. A sophisticated vendor is an expert in dealing with large volumes and has established workflow and protocols in place to avoid such costly errors.
Centralized discovery management also provides the benefit of reducing the errors and costs typically associated with transmitting data.
. . . And Robust Security.
At this year’s LegalTech conference, an expert in law firm data security noted that “law firms are the soft underbelly” to their clients’ data. He explained that cyber-criminals do not even dispatch their best to hack into law firm data. Evan Koblentz, “LegalTech Day One: Relativity 8, Statistical Sampling, Law Firm Security,” Law Technology News, January 30, 2013, http://www.law.com/jsp/lawtechnologynews/PubArticleLTN.jsp?id=1202586212889&thepage=3. Firms may minimize the risk of compromising their clients’ sensitive data by partnering with a vendor who employs a rigorous data security protocol that has been audited and certified by a recognized independent third party.
Such a trusted vendor, with its expertise, efficiency and security, may ease navigation of a constantly changing data world.
There are many benefits to choosing a managed services provider, especially with an eye toward managing high-volume discovery and providing litigation support at a predictable cost. However, as with any enterprise benefit, it’s important to make sure that proper time and research are invested before committing to any provider. Here are a few tips that can help you make the right choice for your needs.
The first quality you want in any litigation support team is experience. A clear understanding for the necessity of building a repeatable, defensible process is integral to the success of your case. And, since every client is different, you also need a vendor who can adapt to your specific needs, whether straightforward, traditional reprographics or advanced digital forensics. There is no cookie-cutter approach toward managed services; every company is different, so your vendor must be experienced enough to adapt accordingly.
You also want a team whose skill and knowledge level align with your goals, no matter how much they change from day to day. If your case starts out with an internal investigation, then escalates into a litigation requiring more comprehensive ediscovery or digital forensics, your vendor should be fully capable of addressing both issues. The ideal provider will take a multifaceted approach toward staffing, and be able to deliver a specialist for your needs, whatever they may be. Litigation is never static, so your service provider has to be able to adapt to new challenges on the fly. The best vendor will customize a suite of services for use on a specific case, letting you choose the right combination of support for your needs. Scalability is also important, allowing your services to flex up or down according to the level of litigation support you require, without a corresponding spike in price.
Finally, your managed services provider must have a system of clear communication in place to hold all parties accountable throughout the process. A focus on documented and established processes that can be incorporated into your existing procedures will help enhance and augment your current routines into a defensible, repeatable practice. Structured reports and objective metrics that are agreed upon by both parties are vital components for ensuring an open, positive relationship that benefits both vendor and client.
Enjoying Clear Benefits
When you work closely with a handpicked provider, your data will become manageable both in terms of discovery and actual cost by streamlining existing processes and choosing the right litigation support to meet the unique needs of your business. Following these tips for choosing the right managed services team will help you successfully mitigate the cost variances associated with à la carte litigation support, without sacrificing customizable services and scalability.