Ediscovery to IT

8/14/2019 Ediscovery to IT

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A Voyage of eDiscoveryTom Knapp

General Counsel, Asia Pacific

18 April 2007


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2007 Computer Sciences Corporation 2

Setting the eDiscovery Scene

Why are large, well respected US corporations paying so muchin Court damages?

Failure to disclose or provide electronic documents in a timely fashion/or at all

Inadvertent destruction of documents after litigation hold should have applied

Spoliation of evidence due to failure to preserve emails and back up tapes


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Setting the eDiscovery Scene

Management of electronically stored and transferredinformation is the hot topic for litigators

A complex, costly and administrative challenge for

corporations

Courts and lawmakers see the need to address theinterface between technology and litigation


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Agenda

The Central Role of the IT Department !

What is Discovery?

What is eDiscovery and why it is different

Why it matters to you

Global trends in eDiscovery

Identifying some key issues and key take-aways

What you might like to do


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Focus on Internal Systems of IT Depts


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What is Discovery?

Parties to an impending civil court action seek toinvestigate and determine facts

Subject to application of privilege claims (eg. attorney-client privilege) during pre-trial phase, each party canrequest documents and other evidence from parties andnon-parties relevant to the lawsuit. Yes, even incriminating

evidence. Alternatively, a party can compel production of evidence bysubpoena (define the universe)


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What is eDiscovery?

The discovery of information stored in electronic form.

Court-ordered or government investigations for thepurpose of obtaining critical evidence

Sometimes used to refer to electronic tools that expedite

the production of electronic documents


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In a Nutshell


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What is different about electronicallystored information?


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eDiscovery Modern corporations encourage decentralisation of information

ownership

Stored in multiple locations and on many formats .Weapons of

Mass Discovery


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Facts and Figures about electronic documents

Volume of electronic documents continues to increase:due to falling costs of storage data

archiving rather than document destruction

easy and cheap to copy, creating exact duplicates

easy to distribute lengthy documents globally


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Building Paper Towers

Paperwork (email and file server documentsonly) so far, from Australias biggest corporateinsolvency

2007 McGrath Nicol (www.mcgrathnicol.com)

.


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Why Me?


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Its About Information Management


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Global Trends

Common law jurisdictions amending civil procedure rulesto specifically address electronic documents

England & Wales (October, 2005)

USA (December, 2006)

Victoria, Australia (February, 2007)

If not managed correctly, cost of locating electronicdocuments:

can exceed the damages sought by plaintiff or likely settlement costs

can act as a disincentive to defend claim

Impact on your corporation depends on state ofreadiness to react and comply

Courts will have no sympathy if your corporation strugglesto promptly find all relevant reasonably accessibleinformation.


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Global Trends Common law vs. Civillaw jurisdictions

Civil law jurisdictions (most EU countries): No pre-trial disclosure

Common law jurisdictions (UK, USA, Canada, Australia): Pre-trialdisclosure / discovery is mandatory

Contrasting examples:

But discovery will apply to European companies or foreign operations where US or UKbased litigation!


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Global Trends State of Victoria(Australia)

E-litigation Practice Note issued 7 February, 2007 provides guidanceon managing civil litigations where electronic documents involved.

Court expects lawyers to have:ascertained number/categories of discoverable documents;conferred with other parties about retention and production of electronic documents;

given notice of problems in providing discovery of any of these documents;

Court may order:a party to provide hardware and software to enable access to electronic documents

the parties to retain an IT consultant to assist compliance

Costs of managing e-litigation recoverable from the unsuccessfulparty

Message: Corporations need to proactively manage all of theirdocuments or risk:inability to properly defend proceedings

being subject to civil or criminal sanctions


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Global Trends United States

The FRCP govern court procedures for civil suits infederal trial courts.

Significant amendments to FRCP effective December 1,2006 specifically to address electronic discovery

Concept of electronically stored information (ESI)introduced

Changes introduced in part to encourage parties to meet

early to understand scope and complexity of identifyingESI to:

Avoid discovery disputes

Minimise costs associated with eDiscovery (estimated 35-40% cost

savings over paper-based discovery)

Federal Rules of Civil Procedure (FRCP)


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Amended FRCP will require careful attention to detail

Parties now must prepare and identify ESI in their possession, custody orcontrol upon becoming aware of potential litigation, so early engagement with

your lawyers is essential Parties must meet promptly after a claim is filed and identify to the other party

such matters including:preservation arrangements and formats for production

all operating systems

office productivity software

disaster recovery procedures

major system-wide databases

document retention policies

how employees store ESI

Litigation hold policy

types of equipment that may hold ESI

potentially privileged information

Categories of ESI that may no longer be accessible

Likely costs and burdens of making ESI available

Parties must provide to each other a discovery plan that addressesall of the above


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Exclusions / Exemptions to discovery:Data that is privileged

ESI that is not reasonably accessible because of undue burden or cost

Emphasis on the data source, not the data.

Egs:

Magnetic backup tapes

Unintelligible legacy data

Fragmented data after deletion

But ESI must still be preserved as the requesting party can still access such data byshowing good cause.

NB: Not knowing the contents of media does not make it not reasonably accessible.

Safe Harbor No court sanction for loss of ESI due to routine, good-faith retention programs


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Impact of amended FRCP:

It is likely to affect the way corporations currently organize,maintain, alter, delete and archive ESI.

A corporations IT personnel will need to understand what changesmay be needed to IT systems that store information electronically.

IT personnel and the lawyers will need to work together!

Know where your ESI is before the lawsuit begins


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ESI Traps for the unwary

And then the traps while seeking to comply: ESI:

Contains more information than paper documents

Data content more difficult to totally discard

Metadata, system records and deleted files are new sources ofdiscoverable information when compared to paper records

Metadata:ESI contain hidden information which is discoverable

Shows a documents format, how, when and by whom it was created, saved,

reviewed or modified (egs. Microsofts basic menu interface/track changesfunctions or emails which capture dates, times).

Documents may need to be accessed in native format to preserve discoverableinformation

Real example:

Client is billed for 4 hours work at partners hourly rate

Document metadata shows only 1 hours work at associates hourly rateOh dear !


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ESI Traps for the unwary

Ghost data routine deletion of a computer file does not delete thatfile

File is renamed and removed from internal directory, enabling overwriting if needed

As memory and storage capacity increase, less likely that the file locations are ever entirelyoverwritten

Network records:Automatically generated records of their own activities

Identifies who had access to data, structure of files, when backups performed, etc

Have you met my computer forensic expert?!


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Duty to preserve documents

Companies must stop deletion of relevant records when litigation isreasonably foreseeable

(egs. Demand letters/Subpoenas)

Must preserve potential evidence

Understand your IT systems now

In-house counsel must be able to: issue a litigation hold notice

ensure the suspension of data destruction

instruct employees to preserve and produce ESI when required

communicate with key employees identified as having relevant information

make sure all backups cans be identified

Foreign related companies (international operations) of a US multi-national must initiate corresponding processes so they can respond toinvestigations or litigation with minimum business interruption.


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FRCP Are you ready?

So how ready are Corporations to respond to theamended FRCP?

More Statistics:

September 2006:35% of organisations (with at least 1000 employees) do not have an email management strategy

Over 50% of surveyed organisations confused email back-up with email archiving (ie. massive.pst back-up files without knowledge of the data retained)

(Association for Information and Image Management - www.aiim.org)

October 2006:Only 7% of responding Corporate Counsel felt their corporation could comply with all FRCP rules

(Association of Corporate Counsel, Annual Meeting, October 2006)

February 2007:Only 6% of corporation employees responsible for email policies felt fully prepared to comply withFRCP rules.

only 38% of respondents were familiar with the new amendments

45.9% of respondents had no retention policy for emails which is a critical requirement tocomply with amended FRCP

56% of respondents were still planning changes and unsure of whether they would comply(Fortiva survey, 2007)


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The Risks of Non-Compliance

What constitutes failure to comply with eDiscovery rules? Spoliation of evidence

Wilful withholding, hiding or destruction of evidence relevant to a legal

proceedingUnreasonable or inconsistently enforced document retention policy

Failure to preserve information on backup tapes

Discovery violationsnegligence in production

delays in production

Incomplete or inaccurate disclosure

What are the penalties for failure to comply with eDiscoveryrules?

Ask the large, well respected US Corporations! Monetary penalties

Adverse influence jury instruction

Preclusion of own evidence (defendants employees not allowed totestify)

Entry of judgment against failing party


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Strategies to consider to ensurecompliance with FRCP

A corporation can demonstrate its intentions to complywith eDiscovery rules by:

1. Making sure the entire corporation is committed

2. Having a robust records management program

3. Having mapped and described its IT systems at the enterprise andoperational levels

4. Assigning a senior attorney exclusively to eDiscovery and records

management processes and compliance and perhaps aneDiscovery Manager

5. Demonstrating processes that enable the prompt ability to locate,preserve and retrieve relevant data

6. Demonstrating it can conduct efficient and detailed searches

across the entire corporations IT systems7. Implementing a comprehensive data retention/deletion policy and

email archiving system that is tied to the records managementpolicy

8. Enabling the automatic deletion function for email to be disabled, if

necessary


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Strategies to consider to ensurecompliance with FRCP (cont)

9. The creation of a questionnaire (and completed by IT personnel) tomap and describe enterprise and operational business unit ITsystems that process and store electronic information that covers:

personal computer and server structure disaster recovery / business continuity

employee departure or transfer

Legal Hold Process

ESI Collection procedures

is expressed in a form suitable for presentation to (and can beunderstood by) outside counsel, opposing counsel and the Court)

10. and be kind to your lawyers!

This presentation does not constitute legal advice or any recommendation by CSC. Participants are encouraged to consult their own legal

advisers on the subject matter presented.


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Experience. Results.

Thank you.