If this scenario hasn’t played out yet in your organization, it’s likely to in the near future: You look up from your desk to see one of your firm’s attorneys in the doorway, who says, “We need to talk. We’re being sued by a former employee alleging discriminatory employment practices. We need to issue litigation holds and prepare for discovery of all relevant materials.”
Discovery requires both sides in a legal battle to provide all information relevant to the case to the opposing side. Today, most information is stored electronically, and it is incumbent upon litigants to produce this information too.
This can require sorting a tremendous volume of data, easily ranging into the hundreds of gigabytes even for a simple case. A process known as electronic discovery (or e-discovery) is quickly evolving to help companies over this hurdle.
Legal Obligations During Discovery
Under the Federal Rules of Civil Procedure (and similar rules adopted by the states), an organization is responsible for ensuring that any records relevant to pending litigation are preserved. This obligation begins as soon as there is a “reasonable expectation” that litigation will take place — that is, before the subpoenas actually start arriving.
Large organizations likely already have a standard process for handling potential litigation, often coordinated through in-house counsel. These rules have governed the retention and disclosure of paper records for many years. Typically, as soon as counsel believes that litigation is likely, they issue a “litigation hold” on all relevant records. This normally takes the form of a sternly worded letter advising all individuals who may possess such documents that they may not destroy them until counsel releases the litigation hold.
In the world of electronic records, this is more complex for a number of reasons. First, while some records may be under the control of individual users (such as files stored on their desktop computers), other records may be under the control of central IT (such as server logs and network traffic records), and still others may be under mixed control (where both central IT and the user may modify or delete information). Second, many organizations use automated processes to facilitate widespread archiving and deletion of data. These processes must be disabled when a litigation hold is in place.
E-discovery, therefore, requires careful coordination between legal counsel, IT staff and end users to ensure that each individual understands his or her responsibilities and that the proper information is preserved until the hold is released. Failure to preserve relevant records may subject the organization to significant fines — in some cases, as high as millions of dollars.
Building a Successful E-Discovery Program
Organizations that are subject to multiple litigation holds annually should consider implementing a formal litigation hold process. This should include, at a minimum, the following elements:
- Litigation tracking. It’s helpful to have a system that can track all of the pending litigation in an organization from start to finish. This may be as simple as a shared spreadsheet for organizations that infrequently handle cases or as complex as a full-featured case management system for larger organizations.
- End-user notification. End users must be informed promptly that they are subject to a litigation hold. The letter notifying them of the hold should explicitly describe their obligations and the types of records that must be preserved.
- IT staff notification. Two categories of IT staff must be notified when a litigation hold is issued. First, IT staff responsible for the administration of central systems that may contain relevant records must be aware of the hold and of the specific information that must be preserved. Second, IT staff who support end users subject to a hold must know that those users are subject to a hold so that computers are not mistakenly wiped for reuse.
- Record preservation system. Organizations need to have some type of process for preserving electronic records during the length of the litigation hold. This may be a manual process involving external hard drives or it may be automated through the use of an e-discovery system.
- Screening and production capability. In the event that a case proceeds from litigation hold to discovery, it will become necessary to filter out those records that are truly relevant to the case and provide them to opposing counsel. This is a specialized skill and may require the use of outside counsel to assist with production.
These five elements form the core of an e-discovery program, but there is a wide degree of flexibility in how they can be implemented. Organizations may choose to automate or outsource many of these tasks, depending upon the volume of e-discovery requirements imposed on them each year.
Three E-Discovery Best Practices
Organizations that are building an e-discovery process should keep these three best practices in mind:
- Work closely with attorneys. The most successful e-discovery programs are a collaboration between legal and IT staff. Each possesses domain-specific knowledge that is critical to successful e-discovery. A strong relationship between the two will help IT understand the firm’s legal obligations and help legal understand the technical issues surrounding record preservation.
- Go outside for help when it’s needed. E-discovery can be an intimidating process. For those who feel uncomfortable working through it, there are many law firms and IT consultants who can assist with the process. Consider using them as guides, especially if it’s the first time the organization is tasked with discovery.
- Reconsider retention practices. It may not be a good idea to preserve all records indefinitely, despite the natural tendency among IT staff. Retention schedules that call for the automated destruction of records when they reach the end of their useful life are best. This will reduce the amount of data that must be sorted through in the production stage. Just remember to disable automated deletion processes when a litigation hold occurs.
Consider these best practices when designing an e-discovery strategy. When used in conjunction with the five core program elements, they will help create a process that is both efficient and defensible in court.