Fear and Loathing: An Examination of the Underpinnings of eDiscovery

eDiscovery has been a popular and confounding topic among litigators for the better part of the last decade. From the initial "wild west," anything-goes mentality, to changes in the Federal Rules of Civil Procedure in 2006, through the proliferation of technology tools and litigation support companies, this area has been continuously evolving. While changes in technology and tools to speed the flow of data processing are important, so too are the attitudes with which attorneys approach the fundamental challenges posed by eDiscovery. This article will look at the changing approaches and attitudes around managing ever-growing volumes of data involved in litigation and government investigations.

From the earliest approaches that involved massive collection events, wholesale processing and large-scale review of somewhat unfiltered data, to today's technology-assisted review methodology, attorneys have adjusted to the new reality of big data. They are also coming to grips with the need to better understand electronically stored information, where it originates from, and how to develop early strategies that limit processing and review to a focused subset of data, in an effort to control the time and cost involved. For the ESI-savvy attorney, big data no longer has to mean big discovery-related bills for their clients.

Origins of eDiscovery

With the development and growth of the internet, and particularly email, text, instant messaging, and social media, how companies communicate internally and externally has fundamentally changed. This resulted in changes to how information was collected and reviewed for litigation and government investigations. The core problem was that there were simply no rules for how to handle these new forms of electronic communication.

In the wild west of discovery, corporations and their law firm counsel worried how courts would treat this new electronic information. They engaged in the most conservative approach, which became the "Do Everything" model. This shortsighted approach, albeit in a legal vacuum of case law, is how "eDiscovery" became a dirty word. Law firms (and some so-called "eDiscovery vendors") did not really understand the underpinnings that fostered the proliferation of electronic information, nor were they privy to the rapid technological advances that allowed a new class of eDiscovery providers to populate the litigation landscape.

The eDiscovery Industry Is Born: The "Do Everything Model"

From the beginning, technology seemed to live in opposition to how attorneys thought about and processed information in response to litigation and government investigations. After all, no one went to law school to become an IT expert or technology guru. However, the head-in-the-sand approach to technology changes resulted in the development of an early eDiscovery model that led to lots of revenue for law firms and newly minted eDiscovery providers, but did not involve a deeper analysis of the hidden costs of the model. The early "Do Everything" model involved multiple processing steps that took place before anyone ever looked at the substance of the data, including:

1. Collect Everything
From the overwhelming growth of information, rapidly emerging technology, and increased, inexpensive storage capacity, the amount of data that could be potentially subject to legal discovery in litigation and government investigations exploded. Law firms wanted to ensure that they adequately captured potentially relevant information, so they instructed corporate clients to collect everything, including file servers, desktop and laptop hard drives, entire email environments, and anything else electronic that could possibly contain potentially relevant information.

2. Process Everything
While the amount of email and other electronic information was growing out of control, no one had yet harnessed the notion of early examination of this data. Rather, wholesale lots of collected data were shipped off to newly emerging eDiscovery providers to process the entire data stockpile. At a time when the learning curve for eDiscovery technology was steep and the barriers to entry high, few people asked questions or stopped to consider the consequences of this broad brush approach. eDiscovery companies developed very large revenue streams in restoring archived and legacy data then transferring the data either back onto paper or into digital formats and sending it back to back to law firms for attorney review.

3. Review Everything
Naturally, the next step was for law firms to have teams of first and second year associates review the information to weed out irrelevant, unresponsive and privileged information. These young attorneys did not yet have sufficient experience to manage their own case loads, but were suitable for the task of reviewing large boxes or now hundreds of gigabytes of electronic documents in early review platforms such as Concordance and Summation, and produced substantial revenues for law firms who billed these associates out in excess of $100 per hour.

4. Produce Everything
The final step in the early eDiscovery process was deliver the responsive, non-privileged documents and produce them to opposing counsel, a process that added to eDiscovery provider revenues since it required conversion of TIF images back to paper format (aka, blowback).

Fear of Spoliation and Sanctions

Another factor that conspired to create fear and foster ultra-conservative approaches to collecting and processing data was the risk of court sanctions for failure to properly preserve key evidence. After a series of decisions in the UBS v. Warburg case, attorneys had their "save everything" philosophy reinforced, reasoning that over-preservation was necessary because there was no way to know at the outset of a case what information is truly needed, or what the strategy will be at trial or facing government investigators. Fear of accidental deletion further stymied any notion of controlling the ever-growing volumes of data being created by corporations, and the specter of multi-million dollar spoliation sanctions had everyone believing that it was truly better to be safe than sorry.

Thusly, a model arose from the start, where every piece of corporate data was stored, all potentially relevant data and data sources were collected, scanned into digital formats and sent off for wholesale processing by third party vendors. The information, once processed for tens of thousands of dollars, was delivered to law firms where large teams of junior attorneys marked documents for responsiveness, issues codes (tags) or privilege, costing several hundreds of thousands of dollars more. Finally, still more vendors would convert the data back to paper for production to opposing counsel. The flaw in this early model did not necessarily come from attorneys' inability to understand technology, but rather from the philosophy of "act now, think later" that obscured the inefficiencies and time delays in this process and resulted in hundreds of thousands of dollars in fees for engaging in the eDiscovery process.

New Rules & the Evolution of Technology

As noted above, before 2006 there were virtually no rules, and even less case law to help guide attorneys on how to collect and manage electronic information as part of litigation or government investigation. Everyone knew that email and files were "standard" sources that needed to be considered, but no one was sure how much or to what extent. Additionally, it was only in the rarest of circumstances that non-standard data sources like database driven applications and mobile devices were included in the scope of discovery.

Federal Rules of Civil Procedure Amended in 2006

Even as the new Amendments to the Federal Rules of Civil Procedure were enacted in December 2006, in an attempt to address the newly encapsulated term Electronically Stored Information (ESI), they did not provide a clear road map because there had not yet been sufficient case law to provide practical guidance. While rules had been put in place to compress the timeline for the discovery process and urge early meetings between litigants to discuss issues such as format and scope of information, there were no true enforcement mechanisms in place and attorneys simply requested and usually received delays in production deadlines. Once again, attorneys took a conservative "wait and see" approach, which meant the status quo of collect, process and review everything remained the de facto standard.

New concepts such as proportionality and the "reasonably accessible" defense to production requests further muddied the waters because each jurisdiction used its own standards to evaluate what litigants would be required to produce in relation to the total amount at stake in the case.

Technology Advances Streamline eDiscovery Processing

In conjunction with these new rules, further technology advances arose that helped to refine the ways in which data could be collected, filtered and searched to streamline the process. Beginning in 2000, technology refinements and more sophisticated analytics became available, giving law firms and their corporate clients the ability to slice and dice electronically stored information, and push less data into the review process.

Some of the key technology advances included:

1. 2000 - OCR - ability to search text
2. 2001 - Native review
3. 2003 - Online redactions
4. 2004 - Concept search
5. 2005 - Early case assessment
6. 2006 - Near deduplication
7. 2007 - Clustering
8. 2008 - Offshore review
9. 2010 - Technology assisted review

Each of these technology advancements were helpful, but none of them addressed the fundamental problem that attorneys simply do not like dealing with technology, and were thus resistant to taking reasoned early steps to examine and reduce the initial amount of data brought into the processing phase of discovery.

Lawyers as Technophobes & the eDiscovery Attorney

Many senior partners in law firms were raised without the aid of technology. This is a simple fact of generational changes. Large numbers of senior partners at the biggest law firms grew up in an era when it was considered a technology feat to set the clock on a VCR. Attorneys are not fundamentally in conflict with technology, but for many attorneys there has always been a natural aversion to technology because they did not grow up with it, and it was never taught to them. The modern practice of law stems back more than 200 years in this country, yet it is only within the last 20 years that the majority of communication shifted from being printed on paper.

With the ascension of a new generation of attorneys, raised with modern technology, some of this technology conflict has been abated, and in many cases new groups within law firms have become the "go to destination" within the firm for eDiscovery. These attorneys have become experts on the case law associated with eDiscovery, and in some cases have explored technology advances such as document analytics, which speeds the culling process. However, they still don't understand the technology behind it (i.e. how an email server functions). This fundamental gap between technology and law remains a core challenge in the eDiscovery process.

New Approaches: The Evolution and Importance of Managing "Big Data"

Late 2009 and early 2010 was a tipping point in how eDiscovery was handled, and attorneys finally recognized the need to stop and evaluate what data might be relevant at the earliest stages of cases. While there has not been a true marriage of technology and law, at least the "do everything" approach has been supplanted by the "over-preserve, then wait and think" approach. Wait and think can be referred to by any number of terms from early case assessment to early data analysis, but at its core it simply means a reasoned analysis of the key custodians in a case, and an early evaluation of strategy leading towards eventual processing and review of a smaller, targeted subset of the data that was initially collected. While technology advances help the way in which this information is presented for early analysis, it is really the paradigm shift from avoiding looking at data until the review phase of discovery that marks this as significant progress.

What is Needed

As law firms have finally begun to move away from the "act now, think later" model, attorneys have recognized the need to better understand their clients' data, including key considerations such as storage, retention periods, data creation, how electronic information flows through an organization and who the key custodians in a given case are. Attorneys do not always have to have all the answers, but asking the questions represents a major evolutionary leap.

The other critical step in evolving the eDiscovery model is to get technical people involved early. Attorneys do not have to become experts in restoring the myriad of email formats, understanding relational databases, or being SharePoint administrators, but it is important to work with people who do understand how these complex systems work. Technologists and law firms should work together to create data landscape models that help them understand how much data their clients have, who it belongs to within the organization and how that data is created, stored and managed. Using this model will help outside counsel better prepare for ESI-related "negotiations" and reduce the costs and time needed to process and prepare terabytes or petaybtes of data for litigation or government investigations.

Summary

The fundamental changes in information technology that took place beginning in the mid-1990s truly shook up the traditional model of how attorneys approached legal discovery. New forms of communication, exponential growth in the amount of electronic data being generated, and the ubiquity of e-mail as a daily work tool meant that a new landscape was emerging. These changes happened very rapidly and without much warning, creating both confusion and opening a new frontier that blended legal process and technology. Most attorneys were not prepared for this fundamental shift, and the idea of relying on technology in the practice of law and case preparation created unease.

Early attempts to either ignore or isolate technology and law led to inefficient models for managing eDiscovery and resulted in the growth of third party vendors who tried to bridge gaps in the process. With each successive advance in technology came hope that the problem would finally be 'solved', but the underlying division of legal process and technology prevented real progress from being achieved.

More recently, attorneys have finally begun to accept the inevitable, and understand that there is no escaping the ever-growing volumes of electronically stored information. In order to manage this data, attorneys have to address key issues early in the process, embrace technology experts who can provide in-depth analysis, and work smarter to develop early strategies for litigation and government investigations.