EDI 2009 Hot Topics In Corporate E-Discovery-Risk Managment and Cost Control

The Advanced E-Discovery InstituteNovember 12-13, 2009

Hot Topics In Corporate E-Discovery

Risk Management & Cost Control

Overview/Agenda

Should a company bring e-discovery in-house?

Four case studies: MMC, DuPont, State Farm & Nationwide

Other cost control issues Take Aways

Corporate Ediscovery 11/13/2008


DuPontNationwide MMC State Farm

Information Management: NationwideSolution Cost of doing business meant a paradigm shift

Discovery Management Unit – 2002 Restructured RIM team – 2005

Note the order: addressing the discovery problem came first. Why do it this way? Immediate cost benefits. Developed information acquisition strategy quickly. Developed program to address issues of response

uniformity. Developed holds methodology. Experience from the discovery phase allows perspective

and prioritization in RIM. Comprehensive RIM requires a long lead time.


Information Management: Decision Process Sprint vs Journey – important to decide which is which

You do need to sprint quickly for prioritized items Medium to high risk objectives that are accessible to you. Those objectives with quick ROI. Those objectives that impact overall corporate litigation profile.

You should allocate others to a well thought out, longer term plan Examples from the systems perspective:

Storage Management – tapes, tape rotation schedules, etc. Email management – archives, foldering, uniform policies.

One conclusion: Discovery and litigation SME’s should proactively get their hands dirty in systems issues.

Consider developing a benchmark against what other companies are doing

DuPont – mail management State Farm – imaging paper / records management Ely Lilly – records management


Information Management: Decision Process Sprint vs Journey – important to decide which is which

You do need to sprint quickly for prioritized items Medium to high risk objectives that are accessible to you. Those objectives with quick ROI. Those objectives that impact overall corporate litigation profile.

You should allocate others to a well thought out, longer term plan Examples from the systems perspective:

Storage Management – tapes, tape rotation schedules, etc. Email management – archives, foldering, uniform policies.

One conclusion: Discovery and litigation SME’s should proactively get their hands dirty in systems issues.

Consider developing a benchmark against what other companies are doing

DuPont – mail management State Farm – imaging paper / records management Ely Lilly – records management


Information Management: Impact on Bringing Discovery In-house As you’ll hear today, a spectrum exists between totally outsourced

discovery and completely in-sourced discovery. Where does your company fall?

One possible critical element: how big are you and what do you wish to take on?

We decided early what our core competencies were Applying discovery expertise to litigation management. Vendor management. Systems expertise. Records management expertise. Lit support expertise – document production, etc.

We also examined what we could do with available resources and whether technology could improve productivity given the cost

Document processing Legal holds Collections

Unresolved question: better to buy tools on the legal side to deal with what are inherently systems limitations or put that same money into fixing the actual problem?


Litigation Hold - MMC

Fortune 200 company with operations in more than 100 countries.

Five global subsidiaries, each with different cultures, a different litigation docket, and technology systems.

Some employees are subject to SEC recordkeeping rules, others are subject to other regulatory requirements.

MMC Legal Hold Implementation Workflow

Legal Dept. issues notice

Identify relevant servers

Locate and

preserve backup tapes

- Make files “read only”- Image laptops/PCs--Store hardware

Records Mgmt-offsite files-extranets

IT

HR & PayrollTrack terminations, leaves of absence

Facilities-building access

-label files

Compliance & Sr business leader

Vendors

DataSecurity

Outside counsel

Triggering eventlawsuit, subpoena, Investigation, audit,

other event

EdiscoveryManager

Employees

Litigation Hold: MMCForming your e-discovery team – success of your discovery readiness plan hinges on it.

Identify all business functions that have a role in preserving documents Some are obvious (Information Technology, Human Resources) Some might not be (payroll, business liaison)

Training and education Basic education about electronic discovery law Train your e-discovery team, employees, and outside counsel about the law, the

Legal Department’s expectations, and the role that team members play in the process. Try a mock legal hold exercise

Enforcement Consider a dotted line reporting relationship Endorsement of senior management Recognition for team members


Collection : State Farm Problem - Big Numbers State Farm insures approximately one in five

cars in North America; State Farm insures more than 15,000,000 U.S.

homes; 75,000,000 North American policies; Receives between 8 and 10 million claims / year 150,000 lawsuits pending at any time. Hundreds of law firms defending SF nationwide.

Collection : Decision Process Document collections and databases controlled by the

enterprise with dedicated centralized staff The documentation of due diligence through a formalized

information gathering process and structure within the enterprise

The tracking of document collection, review and production through an evidentiary document management system

The Master Library – the reuse of previously gathered information

Browser based communication with outside counsel The Multi-Case Platform

Legacy DBs

Transcripts

Exhibits

Production History

Witness Preparation

Case FoldersDraft

Pleadings

Motions

Affidavits

Collection : Litigation Support Concept

Repository

Newly ScannedDatabases

Smith v. SFMAIC (CA)

Jones v. SFMAIC (MS)

RESPONSIVE DOCUMENT

Confidential – For Internal Use Only

Master Library

Stevens v. SFF&CC (IL)

Life of a Document

RFA Sent to Dept Contact

Contact identifies responsive documents

Signed Response returned to LSS

DiscoveryDiscovery

Docs are QC’d

Gatekeeper notifies Case handler docs

are ready for append to folder

Access to review folder given to Retained

Counsel to review for Production

Discovery served on SF

Existing Master Library documents are copied into

electronic folder

New documents copied to case folder

New documents sent for imaging

into Master Library or case folder

Sent to LSS

Review Folder

Document Review: Problem – Offshore/Outsource?

DuPontOffshoring Partner

Long-term Strategic Partner

DuPont Wants:

1. Team Concept applied to discovery Outside counsel has input and seat at the table

Decisions are made internally to assure proper control, consistency, and risk analysis Inside litigation team, Outside Counsel and PSPs work together to ensure success

2. Changed conservative legal approach to a more proactive, data driven, and disciplined risk management process

Reasonability in Discovery process Don’t look under every rock Reduce the top of the funnel

Document Review: Decision Process

1. Intended to take away work from outside law firms and drive efficiencies, quality, and cost reduction opportunities.

2. DuPont has a long business history with India 1996: DuPont Legal sets up an in-house department in India

3. Selected Office Tiger, LLC (an R.R. Donnelley Company) U.S. based company with overseas offices in India, Philippines, Sri Lanka, etc. Comfortable with Office Tiger offshoring review

reviewing documents for responsiveness relevancy, privilege, work-product and issue coding

4. Have utilized the Philippines the most often Found that the Philippines has better language and legal similarities and

availability of qualified candidates, particularly in area of document drafting Philippines: trained in Philippine law schools, dedicated team, familiar with US

legal standards, training, attorney law review5. Important factors in selecting offshore provider:

Cost, quality, speed, relationship

Document Review: Solution

2006 - 5 review projects conducted offshore with a net savings of approx. $500,000

Specific case example – Insurance claim Over 2MM pages of scanned images

No OCR Very little context other than source and case name

Database development to link pages with information on key claims Worked at direction of domestic damages expert Entire analysis piece completed in 3 months Assisted collection team in identifying gaps in

documentation Prepared litigation team to present evidence years ahead of normal

pace Successful case outcome within one year’s time Scalability can create leverage and an “offensive weapon”

Document Review: Solution

2006 - 5 review projects conducted offshore with a net savings of approx. $500,000

Specific case example – Insurance claim Over 2MM pages of scanned images

No OCR Very little context other than source and case name

Database development to link pages with information on key claims Worked at direction of domestic damages expert Entire analysis piece completed in 3 months Assisted collection team in identifying gaps in

documentation Prepared litigation team to present evidence years ahead of normal

pace Successful case outcome within one year’s time Scalability can create leverage and an “offensive weapon”

Document Review Foster an outsourcing environment

Makes it easier to accept offshore capabilities if

already comfortable with letting certain things go

Get comfortable with your provider confidentiality, security

Implement “team” discovery concept Engage outside law firms to train, QC and partner with the offshoring

attorneys. Build confidence in quality

Educate in-house legal department on cost &

quality benefits of offshore work Encourage domestic providers to partner with

Offshore resources

Document Review

•Dedicated supportCreate trusting relationship to overcome risks

• Operational flexibilityTailor individual matters to proper offshoring options

• Domestic may be better than offshore for certain matters

Export control issuesSensitivityLocationsTechnology

Discussion

Risks/risk mitigation with in-house discovery management

Role of outside counsel Litigation counsel Ediscovery counsel

Other cost control Arbitration


Lessons Learned

Focus on critical issues for your company Re-engineer existing processes to get

resources Team with other organizations and hold them

accountable Continually review and optimize processes