Category: Industry

A story on Law.com entitled "Outbound E-Mails Spell Inbound Legal Trouble for Corporations" points to a recent study from Proofpoint.com on how corporations are concerned about the content of their outbound e-mail.

This is Proofpoint’s fifth annual study of outbound e-mail and is designed to examine the level of concern about the content of e-mail and how large organizations are mitigating the risks associated with outbound messaging. This year’s study also expanded to include a look at Web-based e-mail, blogs, social networking sites, etc.

The study received responses from a total of 424 "IT decision makers" including CIOs and IT directors from the US, UK, Germany, France and Australia.

Here are a few highlights that perked up my e-discovery ears:

"In non-compliant e-mail messages leaving your organization, what is the most common form of inappropriate content?"

• 30% - Adult, obscene or potentially offensive content
• 26% - Confidential or proprietary business information about your organization
• 17% - Personal healthcare, financial or identity data which may violate privacy and data protection regulations
• 13% - Valuable intellectual property or trade secrets which should not leave the organization

"Using your best estimate, what percent of your organization’s outbound e-mail contains content that poses a legal, financial, or regulatory risk to your organization?" Answer - 12%.

56% of US respondents indicated that they are "concerned" or "very concerned" about e-mail sent from mobile devices (smartphones or other wireless, Internet-connected devices) as a potential conduit for exposure of confidential or proprietary information.

56% of US respondents indicated that they are "concerned" or "very concerned" about Web-based  e-mail (i.e. services such as Google Mail, Yahoo! Mail, Hotmail, etc.) as a conduit for the exposure of confidential information.

Regarding Policies:

• 98% of US companies (100% in UK) have an "acceptable use policy for e-mail" that includes personal use rules, monitoring and privacy policies, offensive language policies, etc.
• 84% of US companies (75% in UK) have an "e-mail retention policy" that defines what information sent or received by e-mail should be retained and for how long.

24% of US companies reported that they produced employee e-mail in the past 12 months subject to a civil or criminal subpoena. In US companies with 20,000 employees or more, that number rose to 34%. Elsewhere in the world, employee e-mail was subpoenaed less frequently - 6% in UK, 10% in Germany, 10% in France, and 3% in Australia.

"How important to your organization is reducing the legal and financial risks associated with outbound e-mail in the next 12 months?" Answer - 57% of US companies answered that it is "important" or "very important" for their organizations.

"How important to your organization is reducing the legal and financial risks associated with outbound HTTP traffic (e.g., Web-mail, blog postings, etc.) in the next 12 months?" Answer - 51% of US companies answered that it is "important" or "very important" for their organizations.

Survey can be downloaded here or Rob Robinson has posted it here on his Complex Discovery blog.

My postings have been a little sparse lately due to several speaking engagements I’ve been grateful to have on my calendar.

First, I gave a presentation entitled "SaaS: The Time is Now" at the Litigation Support Leaders SuperConference down in Houston last week (Thursday 3/6). My presentation expanded on the themes I explored in my Law.com column entitled "SaaSsy Litigation Support."

I had been looking forward to this conference for a while (although I was disappointed that I had to leave early for another speaking engagement on Friday, March 7). There have not been many conferences specifically for litigation support professionals and I was thrilled to see that Chere Estrin and her group, Estrin LegalEd, used their conference-planning abilities to bring together the powerhouse of speakers for the event including:

• Tom O’Connor
• George Socha (more info on presentation)
• Michael Arkfeld (more info on presentation)
• Henry Alonso
• Lisa Rosen (more info on presentation)
• Charlotte Riser Harris (more info on presentation)
• "More info" posts courtesy of Monica Bay who was also present at the conference

The only other conference that I am aware of at the moment that is specifically geared towards litigation support professionals is The International Litigation Support Leaders Conference sponsored by the Litigation Support Today magazine. I have not been invited to speak at this conference, but I know the keynote by Browning E. Marean III will be worth the price of admission alone!

I hope that both organizations are realizing the benefits in marketing directly to litigation support professionals rather than the traditional audience of attorneys and/or paralegals. This shows the growing importance of the litigation support role.

Today I’m heading over to Chicago to attend the not-to-be-missed ABA TECHSHOW Thursday (3/13) through Saturday (3/15). There are some fantastic presentations in the E-Discovery Track (sort by "E-Discovery" on this page) and yours truly will be giving a presentation entitled "Small Volume E-Discovery: One Hard Drive Could Make, or Break, Your Case" on Friday along with Todd Flaming of Schopf & Weiss LLP.

Other wonderful highlights of this year’s TECHSHOW include the keynote on privacy and the Internet and the new tracks called "Large Firm/Corporate Counsel" and "Mac Track."

Craig Ball posted his insightful “Crystal Ball” predictions for the future of e-discovery in the January 2008 issue of Law Technology News. That inspired me to compile a list of other e-discovery prognostications from around the Web.

I am thrilled to see Craig Ball highlight virtual machines as an important trend for the collection of electronically stored information (ESI). I don’t hear many e-discovery vendors talking about this trend, but I do see a lot of IT professionals reporting the glories of virtualization. That means if you’re collecting ESI, you will encounter virtual environments so you better be prepared.

Next, Craig declares that “data is the ultimate portable commodity” because personal information today increasingly lives on portable media and the Internet. Who doesn’t have a USB memory stick? I have friends that use “portable apps” to transport their entire digital world (office work, e-mail, etc.) back and forth from the office.

Now we’re hearing more and more about “cloud computing” where applications and data storage are dispensed from server farms rather than local computers. For example, e-mail is handled completely online by Gmail, documents are hosted by Zoho Office, billing/invoicing is done by Freshbooks, projects are managed in Basecamp, and contacts are stored on Salesforce.

This prediction is echoed by Dennis Kennedy, who recognizes “EDD in the Cloud” as one of the three most important e-discovery trends out of his broader list of 26.

Those of us involved in electronic discovery must stay aware of these trends because we cannot afford to fall into the trap of thinking that everyone keeps their documents on their C: drive just because we do. Not everyone will keep their data in the cloud, but you can’t afford to leave that stone unturned.

Similarly, law firms and corporations who are reviewing large collections of documents for litigation are electing to host those files in the cloud rather than taxing their internal resources. This was a trend that Dennis raised in his legal technology trends for 2007. Craig Ball predicts that low-cost desktop review tools will become more popular while declaring that “hosted production” will soon become accepted:

“We bank and do our taxes online. Soon we’ll receive and review ESI the same way.”

The desktop review tool can simply be pointed to wherever the data lives - locally on a LAN, or across the world on a server farm.

Inspired by Craig Ball’s predictions, Tom O’Connor predicted five “general trends” for 2008.

Tom first posits that runaway spending in e-discovery will level off in 2008. I hope he’s right.

Tom also declares that “tension between corporate counsel and outside counsel will increase” as corporations strive to cut costs. Tom is right on the money here because corporate counsel are getting much better at educating themselves on e-discovery rather than blindly relying on their outside counsel.

This view is shared by Neil Squillante over at TechnoLawyer, who put forth some of his own predictions this year. Neil promotes what he calls the “apotheosis of the general counsel”:

“…with the rise of electronic discovery, corporate counsel find themselves in need of technology solutions that didn’t exist five years ago. Chief among these — applications for archiving email and other documents in anticipation of lawsuits, and applications for preserving and culling relevant documents from these archives after being sued but before engaging outside counsel.”

I wholeheartedly agree with Tom O’Connor’s third prediction: “growth in the market will occur at the state and local level.” I’ve written about the states adopting e-discovery rules before, and it is inevitable that lawyers who litigate in the state and local courts will have to deal with ESI, regardless of their penchant for avoiding it.

There will be some interesting action in the e-discovery space this year - some bad and some good. I continue to be amazed at how the inclusion of electronic data transforms the world of litigation. The practice of law is so dependent upon tradition for its survival, which means that change always comes slow. But dealing with e-discovery requires new strategies and new knowledge. There is no doubt that the legal profession will adapt (lawyers are constantly learning), it’s just going to be a bumpy ride.

LegalTech always means a lot of vendor meetings and briefings, but I made a point to attend the “Breakfast Briefing” sponsored by the E-Discovery Institute entitled “Counselor, Why Can’t You Google It? - The End of the Multi-Million Dollar Document Review.”

The E-Discovery Institute is a relatively new, non-profit organization founded by Anne Kershaw (A. Kershaw, P.C.), Patrick Oot (Verizon), and Herb Roitblat (OrcaTec LLC).

The room was completely packed, mainly because of the star power of the panel that included Craig Ball, Esq., Julia Brickell, Esq. (Altria), Laura Kibbe, Esq. (Pfizer, Inc.), Jonathan Nystrom (Cataphora), and the Honorable David Waxse (District of Kansas).

Before we got to hear from the panel, however, Herb Roitblat provided some statistics from the Institute’s inaugural study based on a dataset from MCI-Verizon acquisition. The Institute will be releasing a white paper based on study in a few months. Ron Friedmann (who I finally got to meet in person) does an excellent job of covering the findings of the study on his blog.

Once the panel got going, there were some intriguing quotes flying around the e-discovery atmosphere:

Judge Waxse (District of Kansas):

• There is NO requirement in the legal system for PRECISION. It only requires REASONABLENESS. (Ron Friendman also picked up on this.)
• It is imperative for the legal profession to rely on technology to automate the discovery process since it’s obvious that relying on attorneys to perform large document review is inefficient and expensive.
• Don’t forget proportionality - it’s in the rules but no one seems to focus on this enough. Judge Waxse stated that he would never overspend on a case just for the review portion.
• Judge Waxse likes to see both sides solving the e-discovery issues without spending a lot of money (and without involving him if possible).
• If one side proposes what appears to be a reasonable solution to an e-discovery blockade, and the other side cannot prove that the solution is UNreasonable, then Judge Waxse will probably side with you.

Laura Kibbe (Pfizer, Inc.)

• Contract attorneys are the most unreasonable method of review [(i.e. costs and accuracy across the dataset)], but it’s what we’ve been doing for years and years.
• [Referencing the study’s findings where human reviewers were less accurate than a computer-assisted review process, Ms. Kibbe declared:] the original dataset on the MCI-Verizon matter was wrong, but it was fine [(i.e. it was reasonable referring to Judge Waxse’s comment)]. So in reality, we just need to be ‘as bad as’ the Verizon set and we will be fine.
• Ms. Kibbe forces collaboration on her outside counsel by not providing even one e-mail to review until they sit down with the opposing side to hammer out a plan for the collection and review of ESI. She encourages openness and honesty stating that transparency does NOT mean you are showing all of your cards. (Craig Ball seconded her statement by adding that every step of the process, every algorithm, must be exposed to the other side.)

LegalTech New York has been in full swing this week. As usual, the exhibit floor was frenetic, stuffy, and chock full of suitcase-busting vendor schwag.

The best part of the show is always catching up with good friends (corned beef mountains included).

I attended two of the three keynote addresses and gleaned interesting tidbits from both:

Tom Allman kicked things off on Tuesday (2/5) with “The Evolution of E-Discovery.” (I ended up in the back of the standing-room only ballroom with good friend Tim Opsitnick.) Tom Allman is no stranger to this blawg, as I’ve followed his work in a past post.

After strongly emphasizing early discussion strategies, Tom called the amended FRCP 26(b)(2)(B) a “remarkable sentence”:

“A party need not provide discovery of electronically stored information from sources that the party identifies as not reasonably accessible because of undue burden or cost.” (emphasis by Mr. Allman)

Tom pointed out that identifying what you will NOT produce is a new concept in the American legal system. Tom further explained that parties sophisticated in electronic discovery issues will first look at what data is easily accessible before making an ignorant blanket demand for all relevant data. It’s possible that everything they will need already resides in reasonably accessible data sources which means it would be unnecessary to expend resources on burdensome data restoration.

Tom stated that “intrusive discovery must yield benefits that outweigh burdens” and illustrated the point by contrasting two cases from the past year that produced exact opposite decisions:

Best Buy Stores, L.P. v. Developers Diversified Realty Corp. 2007 WL 4230806 (D. Minn. Nov. 29, 2007) - a “downgraded” database did not have to be restored.

In re Veeco Instruments, Inc. Securities Litigation, 2007 WL 983987 (S.D.N.Y. April 2, 2007) - backup tapes were required to be restored.

Next, Tom expressed his favor for the so-called “Safe Harbor” rule (FRCP 37(e)) and commented that most judges dislike the premise of this rule since it restricts their unfettered authority to justly and speedily adjudicate matters.

Lastly, Tom outlined the four main options that the individual States have taken in adopting rules governing the discovery of electronically stored information (see Patchwork E-Discovery in the States for further information):

1. Mirror the Federal Amendments
2. Make selective enhancements (cherry pick)
3. Provide trial courts with guidelines
4. Do Nothing

Thursday’s keynote (2/7) was a panel that included Andrew Drake (Senior Counsel, Discovery Management at Nationwide) and Pallab Chakraborty (Senior Manager, IT Litigation Support at Cisco).

Both of these gentlemen are on the veritable front lines of the corporate e-discovery tide, and had several insightful comments:

Andrew Drake (Nationwide):

• Deals with an average of 2,400 cases at any given time.
• Works hard to reduce the reliance on outside parties without increasing the risk of internal exposure.
• Suggests developing structured methodologies for collecting ESI and publishing the process for appropriate employees.
• Attributes the high volume of e-data to the “Office Depot” effect - the lower the cost of hard drive storage goes, the more data we see stored & archived.
• “If you don’t create a tape, then you don’t have a tape to produce.” (Mr. Drake was not suggesting Nationwide was following this procedure.)

Pallab Chakraborty (Cisco)

• Bringing ESI collection in-house can be efficient because certain custodians appear in almost every case.
• The move away from backup tapes to optical storage means that ESI is not preserved as long as it once was.
• Don’t forget to take into account the size of the index of a litigation document database, which can be 10% of the size of the database (i.e. 10TB database could create a 1TB index).

A story from Maryland’s Daily Record entitled "How law firms are coping in the era of e-discovery" elucidates some of the practical aspects of how law firms are dealing with e-discovery projects.

One spotlight in the story shines on Bowie & Jensen LLC litigator Matthew Hjortsberg who is obviously very comfortable using the Internet. He admits to using the SEC’s EDGAR database, a Greek singles Web site, and the Wayback Machine in past matters for reconnaissance on the opposing party. He accurately states:

“Somebody said something someplace that appears in writing … on the Internet”

Next the story actually *gasp* quotes the Director of Litigation Technology at Bowie & Jensen - Tina Gentle. Don’t get me wrong, I have nothing against hearing the recycled warnings and same dry quotes about e-discovery from litigation attorneys, I’m just thrilled to see an actual litigation support professional included in a story about e-discovery.

Yes of course it is the attorney who is ultimately responsible for the success and security of an electronic document database, but it is the litigation support professionals who sweats through the essential tasks of creating and maintaining a workable document database, constantly training attorneys who neglect (and/or refuse) to learn how to adequately use the review application, keeping the document collection accurate when subsequent load sets appear, and interpreting abstract and inconsistent coding practices into conclusive production sets.

Ms. Gentle explains that the firm uses CT Summation iBlaze to host their litigation databases. The firm currently has 5 licenses, but has considered upgrading to the much more expensive CT Summation Enterprise suite to handle their growing needs.

Mr. Hjortsberg compares iBlaze to a Google search specifically for evidentiary documents and provides the golden quote:

"You load your documents into Summation and then you can do ‘bullion‘ [sic] searches."

(Obviously, I don’t hold Mr. Hjortsberg responsible for the loss in translation.)

Another spotlight in the story goes to Abby Rosenbloom, who is the director of business development for the Baltimore office of the attorney-staffing agency Special Counsel Inc.

Special Counsel is one of the many companies that can supply temporary contract attorneys for a large document review project. Ms. Rosenbloom explains that many of her clients now require contact attorneys to be experienced in tools like CT Summation, Concordance, or Ringtail.

Mr. Hjortsberg continues with some insightful comments:

“There’s a huge distinction between the economic haves and the economic have-nots in this e-discovery world. If you listen to people at a large law firm talk about e-discovery, it’s a completely different process than when you’re representing smaller clients. Before I suppose it was the ability to invest a lot of [associates] into a case; now it’s more like I’m investing in the technology tool.”

Maryland’s Chief U.S. Magistrate Judge Paul Grimm offers the fitting conclusion to the story:

“It’s not about the tools, it’s about the end result of the tools.”

Link to story.

Law Technology News has published their January 2008 EDD Showcase. There are several great articles as always and I’ll do a separate post for each one that I want to comment upon.

First up, e-discovery sage and scholar Michael Arkfeld writes about the confusion of communication involved in e-discovery. This confusion manifests itself most notably in the "meet & confer" sessions when lawyers try to understand the technical terms necessary for a successful meeting.

What I like most about Michael’s piece is that he gives a PRACTICAL and REALISTIC example of this confusion by looking over the shoulder of an attorney trying to decide if a TIFF production is the best format to request from the producing party. Where does the attorney start their research? Google of course.

Of course, the ultimate answer is that the proper production format will depend upon the answers that the requesting party provides for questions such as "will you process electronic documents in-house?" "how much metadata will you need to preserve?" and "what software/online tool will you use to review the information?"

Michael’s solution is a "wiki" that he will be offering on his Website to provide a "glossary of e-discovery exchange terms." He has found that the confusion out there is not resolved with the existing resources from places like EDRM and The Sedona Conference. Keep watching Michael’s site for updated information.

On a related side note, Michael will soon be offering a Vendor Directory from his site. I will be interested to see how Michael’s listing will differ from the one that George Socha offers over on the Socha Consulting Website.

Link to Michael’s article. (Requires free registration to www.lawtechnews.com). 

While the story doesn’t directly involve a litigation matter, the IntraLinks video “45 Days to Find a White Knight” provides a splendid example of how an online, virtual dataroom can facilitate the distribution of documents between clients and outside counsel.

The story recounts how Carl Icahn announced a hostile takeover bid of Fairmont Hotels & Resorts, which prompted the Fairmont shareholders to frantically shop around for a better deal.

The professionally produced short video interviews general counsel from Fairmont as well as attorneys from Fairmont’s outside counsel in Canada, McCarthy Tétrault.

My favorite parts of the video are where the McCarthy Tétrault attorneys are talking about the limitations they struggled with in the past with “paper” datarooms (i.e. requiring the client to physically, and inconveniently, visit the storeroom) and how with a virtual dataroom, the client can look at any document right from their desk. The documents can even be secured so that visitors can only read the document and nothing else.

The attorneys also reported that they saved on copy costs by uploading digital documents, and they were able to track exactly what documents that potential buyers viewed when they were invited into the system.

In the end, the CD backups of the 150,000+ document database effectively acted as their “disclosure statement.”

The video is obviously a fluff marketing piece for IntraLinks, but the story is a golden example of how technology can triumph in the practice of law.

Link to video.

The Post Process e-discovery blog links to a story on Boston.com entitled “Lawyers Try To Catch Up in Tech World” which is a nice, general story about how technology has become critical to the legal world, even though the profession has “resisted” it for many years.

The piece quotes Randi Mayes, the bellwether leader of ILTA, as well as Henry Chace who is still an active volunteer in ILTA and CIO of Burns & Levinson LLP in Boston. The article discusses several activities in a law firm where technology provides a vital function, but Henry specifically addresses litigation matters:

“Before, we’d get boxes of paper, and paralegals would go box by box by box, coding and figuring out what was important on each page. Now we just scan those documents and use algorithms to determine what’s important or not.”

Link to story.

Honorable Mention: Henry Chace authored an article for Massachusetts Lawyers Weekly addressing records management in law firms entitled simply “How To Manage Your Records.”

My good friend Jeff Beard (www.lawtechguru.com) has an excellent column on Inside Counsel exploring the emergence of the ”office of technology counsel” at many corporations. Jeff explains that these positions are being developed to address the “rising market of discussion about the e-discovery gap between IT and lawyers” and provides a handful of bullet points on their common responsibilities.

My favorite quote:

“This office’s [of technology counsel] mission is to transform the organization from one of reactive fire drills and ad hoc processes into a well-oiled machine to enhance repeatability, accountability, predictability and overall risk management. When done well, this translates into enhanced defensibility.”

It’s no secret that many corporations are aggressively exploring ways to better automate and manage litigation expenses in today’s world, which translates into less reliance on expensive, hourly-billable outside counsel. Jeff does an excellent job of describing how the new position of “technology counsel” can help corporations become more knowledgeable in the area of e-discovery and litigation compliance to create that “enhanced defensibility.”

Regretfully, I still don’t see many law firms recognizing this trend for corporate clients. I’m sure there are some law firms that are helping their corporate clients proactively prepare electronic data for litigation purposes (i.e. BEFORE they’re involved in litigation), but the majority of law firms are missing an important “value-add” opportunity.

Link to article.

(On an un-related note, check out Jeff Beard’s excellent blog post entitled “What’s New In Cordless Mice?” where Jeff reviews several portable wireless mice.)