A Proposed "American Rule" for E-Discovery

The Court of Appeals recognized in the famous Mighty Midgets case that in contrast with the legal system of Great Britain, the "American Rule" is that each litigant generally pays their own way. They will not recover as damages the amount expended in the successful prosecution or defense of their rights, including attorney's fees.

The American Rule has some notable exceptions, but the full expenses of litigation generally are not recoverable because of "a fundamental legislative policy decision." The idea is to not "discourage submission of grievances to judicial determination" and to encourage free and equal access to the courts, without fear of penalties apart from the merits. Such a system, the Court of Appeals has recognized, "promotes democratic and libertarian principles."

Under the logic of the American Rule, a corollary might be that neither party shall be enabled to shift their discovery expenses to the other side, or cause the other side to incur expenses beyond those that are "normal" for the case. This begs a bunch of questions in the context of electronic discovery, because of the new opportunities to create or impose litigation costs.

Understanding E-Discovery

More than 99% of the world’s information is currently created electronically, and nearly every piece of electronically stored information (ESI) is potentially discoverable in a civil lawsuit. In an average case today, the process of exchanging ESI with an opposing party (known generally as electronic discovery or “e-discovery”) can mean processing, reviewing and producing potentially millions of pages of electronic documents. According to one estimate, a “midsize” lawsuit is now expected to generate between $2.5 and $3.5 million in e-discovery costs alone. E-discovery, according to one commentator, “represents the greatest sea change in the practice of law in recent memory.

Minimizing the Risk That E-Discovery Failures Will Create Corporate LIability

E-discovery practice in civil cases and government investigations has rapidly evolved since the onset of federal rules governing electronic discovery a little over a year ago. During its infancy, e-discovery was viewed as a costly but powerful tool that could generate "smoking gun" emails that would alter the outcome of cases. Just a few years ago, litigants were infrequently sanctioned for e-discovery failures, in part, because many judges gave litigants who botched e-discovery the benefit of the doubt and chalked up e-discovery mishaps to "the learning curve." Those days are over.

Judicial tolerance for shortcomings in e-discovery is on the decline, and litigants, their counsel and e-discovery vendors are facing direct liability for such failures. As a result, sensibly managing e-discovery is critical not only to success in the underlying litigation but to minimizing the possibility that e-discovery failures will become a source of liability in and of themselves. Before reviewing some ways to minimize the risk that e-discovery failures will create liability, this article draws upon two recent and notable e-discovery disputes to show how liability can arise.

E-Discovery: When Legal Trouble Hits, the Delete Button Will Not Protect You

Many businesses hardly give a second thought to old e-mails, digital documents, and instant messages. But, if you don't know how long employees are keeping these documents, you may very well have some legal time bombs sitting on your company's network or employee hard drives.

Recent headlines serve as a chilling reminder that the e-discovery process can unearth damaging data that sinks careers and company reputations.

E-Discovery: IT Execs Overconfident and Underprepared

Almost 98% of IT executives rate their ability to respond to litigation as above average or very well prepared, according to a new survey from IDC. But according to analysts, they are vastly overrating themselves.

Adam Bendell, senior managing director at FTI Consulting, which commissioned the study, says there is a big disconnect between perceived and actual litigation readiness.

IT executives' perceived ability to respond to e-discovery requests "doesn't jive with the reality that other people involved in the survey or delivering [e-discovery] services see," he says.

Review E-Discovery to Reduce Spoliation Risks

Have you ever been lucky enough to experience the feeling that comes over you when you learn that your client did not retain e-mails that are pertinent to litigation, whether it be that the e-mails were simply deleted or that your client's computer crashed three years ago and sent potentially relevant e-mails straight into Dante's eighth circle of hell? Quite an unsettling feeling. Despite counsel's best efforts, preservation of electronic information seems to be a constant sore spot in complex litigation.

In a post-Zubulake and Morgan Stanley world, where the amendments to the Federal Rules of Civil Procedure went into effect well over a year ago, the struggle with how to best manage electronic data discovery continues. See Zubulake v. UBS Warburg, 229 F.R.D 422 (S.D.N.Y. 2004); see Coleman Holdings v. Morgan Stanley, 2005 WL 679071 (Fla.Cir.Ct. March 1, 2005).

Web 2.0 Collides With E-Discovery

You have received a document request from opposing counsel. Among the various items of calendar entries and e-mails requested is a request for "Any and all social networking or business networking information related to the key player(s)."

This raises questions of what is in scope, where is it, how much is enough, and who is responsible for producing it? Welcome to the collision between Web 2.0 and electronic data discovery.

Why Your Business May Be At Risk . . .

Nearly all of the information now being created and stored by businesses is being created and stored electronically. Paper files and multiple versions of hard copy are becoming a thing of the past. It is no wonder that federal and state courts have amended procedural rules to recognize this trend, and included new obligations on lawyers and businesses (no matter how big or small) regarding electronically stored information ("ESI").

The impact of these new court rules goes far beyond those lawyers and businesses actively involved in a lawsuit; yet businesses continue to remain unprepared to manage these new ESI obligations. In fact, a recent survey of 200 United States commercial businesses conducted by Canvasse Opinion found that almost half of the companies do not have a strategy or policy in place on how to deal with ESI in litigation or in internal investigations.

Unified Communications Bring E-discovery Headache

To its advocates, unified communications is considered the answer to a number of business communication issues. The integration of all communications, including voice and data, over the Internet is gaining wider adoption as organizations pursue it for cost savings, businesses process transformation, enhanced collaboration, and even “green” benefits.

In business, IP telephony has reached about 25 percent of the global market, and many organizations are considering wider deployment, according to Technology Futures, Inc. However, an e-discovery concern that still is somewhat under the radar could slow adoption as companies learn that the move away from traditional phone service includes the conversion of voice mails into e-mail in the form of wave (audio) files.

But the eDiscovery Costs!

As a records manager, I have no problem with keeping email with valuable content as long as it is useful, but way keep a decade plus of all that other "stuff" that has no value? When litigation comes (and it will come) someone will have to sort through all of it when and search tools are only of limited use. Besides, while storage itself may be "cheap" (debatable), the cost of supporting that storage is not. At 25+ terabytes and counting, I know that many of my legal department colleagues and I are looking forward to some serious deletion.

The IT Manager as Pack Rat: E-Discovery Advice

Symantec Corp. hosted a virtual round table Friday that touched on some of the e-discovery issues troubling IT managers today, including the challenge of knowing what to chuck and what to keep.

Gregg Davis, CIO and senior vice-president of the San Mateo, Calif.-based construction company Webcor Builders said, "There are some challenges around information management--you can really upset the records management people. A lot of people don't bother to classify information. But IT has to stipulate that if it exists, it exists."

New Amendments to Federal Rules of Civil Procedures Force Companies to Find New Email Management Systems

New amendments to the Federal Rules of Civil Procedures (court procedures for civil suits) are leading more companies to reevaluate their current email management and archiving systems and find e-discovery software that allows for quick searching and retrieval of electronically stored information (ESI) in response to litigation and discovery requests.

The new amendments to the Federal Rules of Civil Procedures, as well as other regulations such as Sarbanes-Oxley, require companies to have an understanding of the breadth and depth of their information stores and establish preservation policies, archive locations, search methods and deletion procedures to properly manage the life cycle of information in the eyes of the government and courts.

Forensic Accounting: Finding the Smoking E-mail

Think you have a lot of e-mails? Those who work within the e-discovery process — the handling of electronic information and documents for litigation purposes — most likely have more.

“Many of the smoking guns in a lot of these cases reside in e-mail,” said Catherine Parente, CPA, ABV, CVA and partner-in-charge of the consulting services department at CPA and business advisory firm Carlin, Charron & Rosen LLP. She added that one of the cases she’s currently working on includes four boxes of records, two of which contain printed out e-mails.

Will Keeping Old E-mail Put You at Risk?

There is a mindset among many that retaining old e-mails will put a company at risk. Many reason that e-mails handed over to an adversary during e-discovery, for example, will contain a "smoking gun" that could result in embarrassment or the loss of a legal judgment.

In some cases, this mindset has been proven correct. We’ve seen examples in high profile cases over the years of CEOs and others who have said things in e-mail that they wish had not been available for presentation at trial or during pre-trial motions.

In Search of Better E-Discovery Methods

As the burdens of e-discovery continue to mount, the search for a technological solution has only intensified. The holy grail here is a search methodology that will enable litigants to identify potentially relevant electronic documents reliably and efficiently.

In an effort to achieve these often competing objectives, litigants most commonly search repositories of electronic data for documents containing any number of defined search terms (keyword searches) or search terms appearing in a specified relation to one another (Boolean searches). These search technologies have been in use for years, both in litigation and elsewhere, and accordingly are well understood and widely accepted by courts and practitioners.

Practical Tips On The Discovery Of Electronically Stored Information And Privilege And Confidentiality Problems

Case law continues to evolve on amendments to the Federal Rules of Civil Procedure that became effective in December of 2006. These amendments stated that parties are required to place a litigation hold on all documents and records relevant to a dispute, including electronically stored information, upon a reasonable expectation that a formal lawsuit will follow. With careful planning, parties can effectively address a number of recurring issues that have resulted from these amendments.

Qualcomm Repute Had Been Violated By Legal Losses

Qualcomm was drowned by the issue of e-discovery misbehavior which had an impact on client, though it is a base line to E-discovery. The U.S district court of California issued a warning to the entire corporate litigant’s regarding the electronically stored documents and E-mails in the recent issues of Qualcomm faulty.

School Districts Wrestling with ABCs of E-Discovery, Compliance

School districts face a mandate to keep electronic information accessible for e-discovery and public records searches. But for many public schools, confusion about the legal requirements and a lack of funding present roadblocks to data compliance.

Is Your Data Wide Open to Your Opponent?

Information technology departments of sophisticated organizations are already aware that each party to a litigation in the United States is obligated to collect its own discoverable electronic information to be produced to the opposing party.

Every Click You Make, Your Boss Is Watching You

Employees who regularly use company computers to surf the Web, sign on to business accounts for personal e-mail, make calls from company phones or use the corporate car to run errands run the risk of losing their jobs, according to a new survey released by The ePolicy Institute and the American Management Association (AMA).