VeBridge News: 5-4-07

Business Lexington Article - Avoiding the "gotchas" of Electronic Document Discovery

By Paul Engel
Contributing Writer

The rubber has met the road. The new Federal Rules of Civil Procedure (FRCP) went into effect at the end of 2006. The days of writing articles warning of the impending change and suggesting ways to prepare are over. Many have not had time to prepare. They didn't think life would change, or they didn't think they would become involved in litigation this soon. Most have dodged the bullet, but those who have not have learned many lessons. Which brings us to the EDD Gotchas.

All the dire warnings last year implied that EDD was a new issue. It was not. The use of Electronically Stored Information (ESI) in managing business has grown exponentially over the past two decades. This has led to the growing trend in recent years for attorneys to request ESI in native format for use as evidence in litigation. The main factors driving this growth were cost and accessibility. It is much less expensive to deliver and review ESI in electronic format than to print it, scan it and OCR it. In its electronic format, it can be more reliably searched for key words and phrases, and the electronic version can be much more revealing. The reviewer can see things not available in the printed versions of files, such as multi-version markups in word processing documents, as well as hidden spreadsheet columns, rows and sheets and associated formulas. These heretofore hidden areas are where the smoking guns reside!

As anticipated, the rule changes have sparked a significant increase in ESI requests for productions associated with litigation. What was previously perceived as optional (ESI production) is now mandatory. Many more litigants are being required to exchange ESI in native format. The steep learning curve has begun. All of the "lessons learned" cannot be passed along in a short article, but the two main ones are outlined below.

Lesson one

ESI is no different than paper in many respects. Some litigants will attempt to "wallpaper" opponents who have fewer resources. We have seen companies produce hundreds of gigabytes of e-mails in response to a request for production (If printed, 100GB of ESI would produce about 5,000 boxes of paper!). The intent of wallpapering is to require opposition to spend more on the evidence review than is at stake in the litigation, thus forcing them to settle or drop their litigation. The review alone of 100GB of ESI could cost over a half million dollars in legal fees.

When litigants are wallpapered with real paper, the main recourse is to perform a cursory review of the documents hoping to quickly unearth material evidence in their favor. (They can also ask a judge to intervene and compel the offending party to play fair, but this is not usually successful.) With EDD, on the other hand, recipients have the option to electronically filter the produced ESI in order to automatically cull out the non-responsive items. This can be done by applying filters to the metadata or the contents of the material. Metadata is "information about information." For example, the "To:," "From:," and "CC:" fields of an e-mail are metadata. By filtering the ESI during the EDD processing phase, a litigant can reduce the evidence to the most responsive items before an attorney or paralegal spends any time examining the material.

Other issues presenting EDD challenges include:

• Duplicate e-mails: Paying legal teams to read multiple copies of the identical e-mail is costly in both time and money.

• Password-protected files: Often the most sensitive files, and most likely to reveal important evidence, are password-protected. Without good password-cracking tools, this evidence cannot be reviewed.

• Family documents: In many cases, the e-mail to which an enlightening document was attached is material to its value. It is important to track these "family" relationships between e-mails (the parent) and attachments (the children) in the EDD processing process. These relationships will often establish the timeframe within which a document became available to a party in the litigation. Losing these vital links could be the difference between winning and losing a case.

Lesson two

The costs associated with EDD have become clearer to litigants. The material cost savings touted over paper productions are coming to fruition. So why aren't people happier? Mostly because there is emotional sticker shock associated with the processing of ESI. When litigants are told by law firms that the cost to perform EDD processing of ESI will run thousands of dollars per DVD, it is difficult to accept. The DVDs are relatively small pieces of plastic that cost around a dollar and take less than an hour to burn. How could they possibly cost so much to process for legal review? A recent client asked his attorney, "Why don't you just put the DVD in your PC and open the files one-by-one?" The answer to this question can be derived by understanding many of the issues raised throughout this article. But, from an emotional standpoint, it's hard to swallow.

Putting EDD processing costs into perspective by comparing to a paper production is helpful. A client recently had an EDD production that included three DVDs. The DVDs contained over 124,000 e-mails and 74,000 electronic files. If printed, this mass of evidence would have yielded 1.3 million pages, or 600 boxes of paper. The cost to produce the EDD from this collection was just over $20,000. To process the paper equivalent, the cost would have been almost $750,000. But the best part was that through filtering and de-duplication, over 160,000 pages were rejected as non-responsive, saving over $60,000 in legal review.

As with any project, legal or otherwise, lessons learned are paramount to future success. It is through the learning process - often painful in one way or another - that we find what works and what doesn't. With ESI and EDD, lesson one - paper and ESI are treated virtually the same - is key to avoiding many pitfalls. Thereafter, aligning your organization with law firms and EDD vendors who understand wallpapering, filtering, deduplication, password cracking, family documents and the like is a must. Moreover, you can avoid numerous EDD gotchas by ensuring you have processing, service and pricing options available to you meeting your specific business requirements for each and every litigation situation.

Paul Engel is president and chief technology officer for VeBridge, a nationally recognized expert in document management and litigation support.