2011 Outlook For E-Discovery Disputes

In the past several years, electronic discovery has become the equivalent of a four-letter word for large enterprise IT and legal departments, which have struggled to deal with the cost and complications of this relatively new discipline.

The process of manually collecting, processing, analysing and reviewing email and electronic documents in response to investigations, litigation and regulatory inquiries has in fact become so costly – and fraught with risk – that many organisations have taken steps to automate and take control over the process.

As a result of the push to establish greater control, enterprises have increasingly begun to develop e-discovery competencies as core business processes. Many companies are even taking an additional step of appointing a director of e-discovery who understands both the IT and legal landscapes. These trends are especially noticeable and catching on in the U.S. Yet, even as legal and IT teams establish a beachhead against existing challenges, new ones arise almost daily – requiring enterprise legal and IT to adapt once again.

Furthermore, the proliferation of social media has opened up a new can of worms for enterprise IT and legal departments to address. The challenges surrounding the data stemming from both employee use of external social media and corporate use of these channels internally are largely unprecedented in e-discovery. No enterprise wants to become the test case for courts or regulators looking to set a precedent for how “not” to handle social media e-discovery.

The following three predictions are what we expect to create the biggest waves in e-discovery in 2011 in the U.S. These predictions point to activity that is expected to catch on globally, with the UK as a region that is also rapidly evolving in its approach to e-discovery/disclosure. Enterprises that can understand the implications and proactively prepare for this evolving landscape will be well equipped to keep steady control over both costs and risks despite these ever-changing challenges.

1. Changes in Forensic Best Practices: In 2011, manual forensic imaging will continue to take a backseat to more automated, forensically sound data collection techniques. Forensic (bit for bit) images have long been the gold standard for the legally defensible collection of ESI in response to legal proceedings. However, while forensic imaging will continue to be important in a number of discrete situations (fraud, misappropriation of trade secrets cases, criminal matters, etc.), it will largely be seen as overkill in most electronic discovery cases. Since imaging is both time consuming and highly manual, savvy organisations will increasingly use automated, forensically sound collection tools to perform targeted collections.

2. Proportionality Becomes Reality: Burgeoning data volumes, as seen in multi-terabyte (versus gigabyte) cases, means that the legal community will continue to search for ways to prevent electronic discovery costs from exceeding legal exposure and attorneys’ fees. Groups like the Sedona Conference in the U.S. will continue to push for better clarification within the legal community surrounding “proportionality” in order to keep the electronic discovery “tail” from wagging the litigation “dog.” If this push is successful, there may be a slight respite for litigious enterprises that may be able to better scale e-discovery efforts with the risk profile of the matter at hand.

3. Collision of Cloud, Social Media and E-Discovery: The seemingly unstoppable migration of corporate data to the cloud, combined with the proliferation of social media applications, will continue to stress electronic discovery practitioners as they attempt to preserve, collect, search and process electronically stored information (ESI) from sources that aren’t traditionally managed behind the firewall. Proactive enterprises will increasingly evaluate the legal and compliance risks of storing data in the cloud so that they’re not painted into a corner when they need to preserve, collect and produce offsite ESI.

In the past, the crux of most discovery matters usually centered around email and sometimes instant messaging. In 2011, new problems will continue to crop up, such as collecting SharePoint data from the cloud, trying to extract structured data from a range of proprietary systems and capturing ephemeral ESI from an ever-changing array of social media applications.

While the tools and best practices designed to combat e-discovery hurdles continue to mature, new challenges are multiplying at any equally fast rate, meaning IT and legal departments must remain nimble and educated on the challenges to respond accordingly.

SHARETweet about this on TwitterShare on LinkedInShare on FacebookShare on Google+Pin on PinterestDigg thisShare on RedditShare on TumblrShare on StumbleUponEmail this to someone

Dean Gonsowski is a licensed member of The Sedona Conference Working Group on Electronic Document Retention and Production (“WG1”), the Electronic Discovery Reference Model, and teaches a series of CLE courses on various e-disclosure topics. Dean also serves as VP of E-Discovery Services at Clearwell Systems, where he helps enterprise customers deploy best practices as they bring e-disclosure in-house.