Baby Steps in Data Preservation for Legal Obligations- Big and Small Companies
Symptoms of data preservation obligations among corporate in-house counsel may include: dizzy spells, nausea, cold sweats, hot sweats, fever blisters, difficulty breathing, difficulty swallowing, blurred vision, involuntary trembling, dead hands, numb lips, and fingernail sensitivity. To make matters worse, according to what appears to be the first quantitative study looking at the true costs of preserving data for legal purposes by University of Chicago Law School assistant professor and author William Hubbard; mid-size corporations seem to be most vulnerable to the financial burdens of data preservation efforts. In addition, mid-size companies also appear to take the “the brunt of business-crippling” data preservation sanctions, according to the study. Hubbard found that the largest companies surveyed were topping out at data preservation budgets of over $40M per year while companies with fewer than 10,000 employees where rolling the dice and some were infinitely saving all electronic data in order to avoid eDiscovery mistakes and the possibility of costly sanctions.
The study showed that only a fraction of preserved data is ever collected and an even smaller fraction of the data is actually processed and produced during litigation. More importantly, even the slightest rule changes to the Federal Rules of Civil Procedure (FRCP) in particular Rule 37(e), could result in million dollars savings per year mitigating the need to over-preserve. A December 1, 2015 rule change is no guarantee, so with that in mind, what should mid-size corporations due to maintain their obligation to preserve data while at the same time not break the bank in doing so?
Baby Steps: It means setting small, reasonable goals for yourself. One day at a time, one tiny step at a time—doable, accomplishable goals.
Start small. Most large fortune 100 companies have the budget and technologies in place to internally handle any type of litigation. They have incident response teams, eDiscovery professionals, and an army of attorneys on staff. Mid-size companies do not have that same luxury and need to get creative. Part of that creativity process should be engaging a third party provider or expert who can help you build a game-plan for dealing with legal hold, data collection, and legal review. Today’s tools are nimble enough where you can provide legal review with a built in module for legal hold: think kCura’s Method, soon to be known as Relativity Legal Hold. Secondly, forensic providers should be able collect and cull data in place in order to minimize processing and legal review. Parachuting a reliable provider in to help when there is an eDiscovery incident is not a failure. The vetting process, though, should be done well ahead of time rather than as a reaction to litigation.
Baby Steps to four o’clock
Often times we find that corporations try and tackle too much when dealing with data preservation efforts for legal obligations — for example buying eDiscovery software that is too robust, too complicated, with too many features, and then it becomes shelf-ware in 6 to 12 months. The rule changes set to become effective December 1, 2015 will definitely help but it is unclear whether congress may defer, modify or completely reject the modify rules. In the meantime, if companies take small and reasonable goals in dealing with preservation duties than the likelihood of becoming a multi-phobic personality, paralyzed by unreasonable obligations,working in a constant state of panic, will hopefully be at a minimum.
Sources:
For an abbreviated version of the proposed rules and committee notes, which have been condensed from 354 pages, visit this post by e-Discovery Team.
Read the complete CJRG report here.
Read the summary of findings here.