e-discovery 2.0

(Editor’s note: This special guest post was written by Teddy Cha, Clearwell Senior Product Manager, MIT alum, and coffee connoisseur. Teddy was a key member of the team that developed our Legal Hold Module and has worked tirelessly with our engineering team and lead customers to bring the product to market. – Kurt)

Legal hold is a critical first step to any e-discovery process, but as recent experience has shown, enterprises are still struggling to perform them in a defensible and repeatable way. A judicial warning was heard as early as 2003 with Judge Sheindlin’s ruling in Zubulake v. UBS (and most recently in Pension Committee).  The need for change is not coming from only a single judge, however.  In 2010, the Duke Law Journal studied the level of sanctions compared to previous years and found that:

1. Sanctions are at an all-time high (up 271% since 2005)
2. Damages were as high as almost $9 million
3. The most common misconduct was the failure to preserve data

Sending legal hold notices can start out simple, but it can quickly become unwieldy if not managed correctly. It’s like taxes. Everybody has to do them, and it typically starts out as a “simple” process. But as your assets grow, you may want to invest in more complex software or an online service to maintain efficiency. And once you start a family (or a small business), you’ll need to graduate to a much more robust process.

As companies grow their legal hold process evolves in the same way. Their progression can be described in the following distinct three stages:

Stage 1: Manual Legal Hold Process

Sending a litigation hold notification is as easy as…well, sending an email. But tracking these litigation matters and their responses in spreadsheets quickly grows out of hand once a poor paralegal has to manage a 10th, 20th and 50th simultaneous legal matter (or even multiple holds in a single case).  This manual process is difficult to repeat, error-prone, and likely doesn’t reflect the real-time status of compliance the second the spreadsheet is saved. Typical corporations are concurrently managing hundreds active legal holds, involving thousands of custodians, across multiple business units and groups. It becomes quickly apparent that a better solution is required.

Stage 2: Stand-Alone Legal Hold Software

Legal Hold solutions have been in the marketplace for a number of years. Typically they fall into two categories:

1. Matter Management or Information Governance systems that help enterprises construct workflows and integrate record management policies and controls. Legal Hold notification capabilities are an appended component to these ambitious and holistic solutions. These systems are typically expensive and have long implementation cycles.
2. Narrowly focused offerings aimed at managing just legal hold notification and survey tracking. These solutions typically cost less than the above and are delivered as a hosted service (SaaS).

Stand-alone legal hold software products are certainly an improvement on the Stage 1 manual process. But despite virtually all major enterprises needing some sort of legal hold process, they have not yet raced to embrace these Stage 2 solutions yet. Why not?

Following a typical e-discovery case quickly uncovers the problem. Sending and tracking legal holds is a necessary part of the e-discovery process, but it is only the first step. Soon after custodians are notified of their obligation, e-discovery teams must separately collect, process, analyze, review, and produce that data using other solutions. Stage 2 legal hold solutions are stuck just managing the holds.

This is where purchasing a stand-alone legal hold solution is a bit like buying an iPhone without the network plan: You can’t really do much with it (well, you could play Angry Birds, but only if you download it over a WiFi connection). You can’t obtain your goal of mobile communication without a phone and a network plan.

Stage 3: Integrated Legal Hold Software

To address to drawbacks of Stage 2, many companies today are looking for a more integrated approach – one that marries legal hold with the rest of the e-discovery process. This is where Clearwell’s new solution can help. Once custodians have acknowledged the legal hold notice, Clearwell can immediately reach across the enterprise network and collect those custodians’ data. Once the data is collected, a few clicks of the mouse prepare it for early case assessment (ECA), analysis, and review.

As any experienced corporate IT and legal executive will tell you, such a comprehensive solution has long been promised, but has not come with fast implementation (i.e., up and running in a day), ease of use (i.e., no training required), or in a single platform  (i.e., one login for users and no exporting or importing of data between e-discovery phases). With this in mind, we are delighted to announce the Clearwell Legal Hold Module, now available as part of the Clearwell E-Discovery Platform. Combined with Clearwell’s Identification & Collection, Processing & Analysis, and Review & Production modules, companies can now leverage a truly integrated e-discovery solution to lower the cost and risks of e-discovery. Key features of the new Module include:

• Hold Notices: Hold notices can be quickly created and sent to relevant custodians and system administrators via email. Different notices can be sent to custodians and system administrators, streamlining the notification process. Notices can be sent immediately or scheduled for delivery.
• Auto-Reminders and Auto-Escalations:  Reminders and escalation notices can be scheduled for delivery to non-responsive custodians, eliminating the need for manual follow-up.
• Custodian Surveys: Surveys containing single-choice, multiple-choice, or free form text questions can be created and issued to key custodians so administrators can easily capture information critical to a case, thereby expediting the interview process. Surveys can also be saved as templates to the Notice Library and reused.
• Automated Tracking and Reporting: Administrators have immediate visibility into the status of all legal hold notices across all cases through a single pane of glass. Administrators can drill-down by case to view the status across all custodians, including those who have received and responded to their hold notices, and those who haven’t.

Until today, corporations have been making do with manual or stand-alone legal hold solutions that are neither scalable nor integrated with the rest of the e-discovery process, assuming more and more risk and incurring greater costs – never an ideal combination. Fortunately, it no longer needs to be that way.

(Teddy Cha is a Senior Product Manager at Clearwell Systems and the lead Product Manager for Clearwell’s Legal Hold and Identification & Collection Modules.)

For years, concept search in electronic discovery has been like concept cars at auto shows: Cool. Slick. The thing that everyone is talking about.

But not ready to move to the assembly line and be put into production.

Like a concept car, concept search has been based on a lot of good ideas and shown a lot of promise. However, it has failed to move beyond a few edge use cases and reach mass adoption in the e-discovery market.  Why is this the case?

It’s not been because it’s an unproven idea or that the basic technology hasn’t been available. In fact, the core algorithm that underlies most existing concept search technologies has actually been around since 1988, when latent semantic analysis (LSA) was first patented by a team from Bell Labs. Over the last 20 years, dozens if not hundreds of companies have sprung up to apply concept search to the broad area of enterprise search and to e-discovery in particular.

To understand why concept search has never taken off, it’s always interesting to look for parallels, and the parallel du jour is social networking. Readers of David Kirkpatrick’s excellent book The Facebook Effect and (perhaps to a lesser, more fictionalized extent) viewers of the movie The Social Network understand that Facebook was far from the first social networking site (remember MySpace? You won’t admit it, but I know you do). But, despite being several years late to the party, Facebook somehow took the core of the social networking idea and presented it to users in a way that really allowed it to “cross the chasm” to the mainstream market.

In introducing Transparent Concept Search, Clearwell plans to help conceptual search cross that same chasm in e-discovery.  In talking to customers over the last couple of years, we have found that there are unmet customer needs with existing concept search products that, once addressed, will really allow its use in e-discovery to flourish – and not just in a way that makes concept search marginally more useful, but, a la Facebook, makes it orders of magnitude more useful.

What are these unmet customer needs?

Ease of use: Historically, concept search has been relatively easy to use in the strictest sense of the word – you type in some terms that represent your concept, and you get a set of search results back, along with some related terms and/or clusters of related documents. Simple, right? The issue is that in most cases that’s not what the user really wants to do. Because concept search is inherently “fuzzy”, users want to be able to refine their concept based on the feedback that they got from their initial search. Concept search, just like keyword search, is an iterative process, and prior-generation technologies have not allowed for that form of iteration. In contrast, Clearwell’s Transparent Concept Search allows concepts to be defined and refined in a way that is intuitive, visual, and (don’t take my word for it, but try it for yourself) fun.

Precision: Traditional concept search increased recall when compared to just keyword search, but it came at the cost of precision. The refinement process facilitated by Clearwell’s Transparent Search addresses this issue by allowing intelligent human input to guide the concept search process. You get the best of both the recall and precision worlds with vastly diminished time and effort.

Defensibility: Even more important than ease of use and precision is defensibility. Defensibility, for those new to the term, isn’t so much about whether the way the algorithms work is known and able to be understood. They are, and aren’t that complicated. Rather, defensibility is about reasonableness: was the concept search a reasonable way of determining which documents are responsive? Without the ability to define your concept in an interactive manner, we believe that the answer has historically been “no”, making concept search nice in theory but unusable in actual legal practice. Transparent Concept Search promises to change that. The end result is a more defensible search process that yields both greater recall and greater precision, enabling users to more quickly analyze case facts, rapidly identify key documents that may have been missed, eliminate irrelevant documents, and prioritize the most relevant documents for review. Clearwell also provides a reporting and auditing feature to document your search, allowing you to improve defensibility by “proving up” what was done.

Low cost: Finally, never underestimate the value of “free” in helping meet the ever-important unmet need of cost predictability and control. Historically, vendors have charged price premiums (often substantial) for concept search. Trying to charge a premium in e-discovery for something that doesn’t fully meet the customer use case and isn’t defensible, and it’s a recipe for low adoption. However, provide a highly useable, effective, and defensible capability as part of the core functionality of today’s leading e-discovery platform, and it starts to look very attractive indeed.

Hopefully you can tell that we’re incredible excited about the promise that this technology holds for the market, and this initial version is really just the beginning. Want to see it for yourself? Check out the video below, visit our web site or, if you are in New York this week, please visit us at LegalTech New York – we would love to see you.

The new United Kingdom Practice Direction 31B and recent UK case law make it clear that electronic discovery, referred to as electronic disclosure or eDisclosure in the UK, is quickly becoming an issue in jurisdictions outside the United States. The Civil Procedure Rules (CPR) in the UK essentially serve the same purpose as the Federal Rules of Civil Procedure (FRCP) in the United States and the issuance of Practice Direction 31B in October 2010 adds teeth to eDisclosure requirements much like the amendments to the FRCP in December 2006 added teeth to eDiscovery requirements in US Federal Court.

Although UK Practice Directions are not included within the text of the CPR, they may be incorporated into the rules by reference. For example, Civil Procedure Rule 31.6 requires a party to disclose “documents which he is required to disclose by a relevant practice direction.” Simply put, this means competently litigating cases within the UK legal system where the estimated value of the claim exceeds £25,000 (£15,000 if filed before April 6, 2009) requires familiarity and compliance with Practice Direction 31B and its detailed eDisclosure guidelines regarding data preservation, reaching agreements with opposing parties, the use of technology, and many other key eDisclosure areas. In fact, the Practice Direction includes a useful questionnaire to serve as a checklist and help parties exchange key information.

UK eDisclosure champion, Chris Dale, recently co-authored a white paper with Clearwell Systems titled, “The New Practice Direction and eDisclosure: Best Practices for Complying Proportionately” that discusses many key requirements and recommendations contained in Practice Direction 31B and the important role technology plays in meeting these requirements. The white paper further explores the import of key cases in the UK that are shaping the UK eDisclosure landscape. This white paper is a good read not only for UK litigators, but for any US litigator likely to handle matters in the UK. Click the following link for a free copy of the new white paper: The New Practice Direction and E-Disclosure — Clearwell.

If you’re anything like Dr. Evil, Tears for Fears, or Napoleon, ruling the world is at or near the top of your to-do list, and part of ruling the world is having as omniscient a knowledge as possible of what’s going on, in order to better control it. Ruling the world has also long been the dream of many software vendors, who want to own and understand all the information in an enterprise in order to, um, provide maximum value to their customers… oh, and also to lock them in to a single underlying platform that allows them to control as much of the organization’s information management decisions as possible.

In some cases, these dual interests are aligned. However, in e-discovery, it’s not so clear. Over the last couple of years, many vendors have pushed a notion of “index everything” or so-called “proactive” e-discovery, in which you have instant access to all the information in your enterprise, in real-time, from which to drive your e-discovery process. But is this feasible? Or even desirable?

The Myth of the Silver Bullet

It can be tempting for IT to turn to an enterprise search solution that can index all data sources – laptops, desktops, file servers, SharePoint servers, databases, email archives, content management systems – and enable e-discovery across the entire enterprise in an instant. The reality is that while such a solution may work for enterprise search in small and medium-sized companies with a finite scope of data, the level of complexity in scale and defensibility of operations makes this simply not an achievable approach for e-discovery at most large enterprises. As Anne Kershaw and Joe Howie of the Electronic Discovery Institute noted in their just-published Judges’ Guide to Cost-Effective E-Discovery:

“There is no single silver bullet that solves all problems associated with escalating discovery costs and delays. As noted above, the single most effective cost reduction method is the focused collection of records most likely to contain relevant information. Some argue that e‐discovery is best accomplished by taking large amounts of data from clients and then applying keyword or other searches or filters. While, in some rare cases, this method might be the only option, it is also apt to be the most expensive. In fact, keyword searching against large volumes of data to find relevant information is a challenging, costly, and imperfect process. A much better approach is to ask key client contacts to help you locate core relevant information and then, by reading that information, determine other sources of relevant information.”

What are the specific reasons why a targeted collection approach is superior? From our conversations with clients as we have been developing our solution to this problem over the last couple of years, three major drawbacks to the index-everything approach stand out.

1. Impact to Existing IT Environment

While the collect-and-preserve approach employed by Clearwell is widely accepted for e-discovery, index-everything and preserve-in-place solutions have recently emerged, originating from other enterprise applications such as knowledge management and enterprise search. These approaches from other domains have significant disadvantages when applied to e-discovery, including impact to existing IT infrastructure and processes that result in increased cost and complexity. For instance, the scope of e-discovery can exceed the amount of information being indexed by knowledge management or enterprise search applications. According to Forrester, the majority of enterprise search implementations range in size from the hundreds of thousands to tens of millions of records, not billions of documents that are potentially discoverable during litigation. Consequently, index-everything solutions must index a much larger volume of data across a broader range of applications and data stores than would typically be necessarily for enterprise search.

Indexing such a large amount of data has implications for the entire IT environment. These solutions either crawl data repositories over the network or employ agents on local desktops and laptops to find new and modified files. IT organizations using these solutions report experiencing disruptions including:

• Requiring read access and permissions to numerous line-of-business applications and storage systems where data resides

• Significant increases to disk I/O for enterprise applications, network file shares, and client machines

• Increased network consumption as large amounts of data are read over the network

• Increased consumption of local hard drive space on employee desktops and laptops for search indexes and redundant copies of preserved files

• Scheduling resource-intensive indexing tasks during off-peak hours, impacting the ability of IT departments to complete backups during shrinking backup windows

Taken together, these issues add cost and complexity to the deployment of index-everything and preserve-in-place solutions. This often results in organizations not fully deploying the solution after purchasing licenses and spending months or years trying to integrate with their existing systems.

2. Risk of Missing Critical Data

Another key concern of organizations seeking to meet e-discovery requests is the ability to find all relevant files and documents for a case. Missing even a few important documents may result in multimillion dollar fines and sanctions. UBS and Morgan Stanley each paid $29.2 million and $12.5 million, respectively, for losing key files during litigation. It is therefore critically important that e-discovery solutions have the ability to not only index and search common file types, but also a range of less common but equally important files such as those within nested container files, encrypted files, and TIFF images containing text. Solutions that originate from applications outside the e-discovery domain often skip these files because 100% accuracy is not required for other applications such as enterprise search. Across organizations with billions of documents, there may be hundreds of thousands of potentially relevant files which are in the dark and unknown to legal teams because they are not indexed.

Index corruption is another commonly reported issue with index-everything solutions that results in incomplete search results. Search indexes are susceptible to data corruption just like any other computer file, but the large size of indexes containing billions of records increases the probability of errors. In fact, this is a common problem of most archive solutions and other solutions that manage billions of records. A corrupt search index will result in incomplete results or in the worst case scenario, the inability to conduct searches until the index is repaired. In some situations, data must be re-indexed to rebuild a corrupt search index which is time consuming due to the slow speed of some solutions.

The net result isthat in-place solutions increase the likelihood of missing critical data, exposing the organization to considerable legal and financial risk.

3. Time Delays and Uncertainty in Searches

When embarking on a project to make all enterprise data searchable for e-discovery, an important consideration is indexing speed in relation to total outstanding data and projected data growth. Organizations deploying such a solution typically have a large amount of existing data that needs to be indexed, and this index must be continually updated as data is modified and new data is created. Many companies report that although vendors claim high processing rates, these high rates erode over time as companies index greater amounts of their existing data, increasing the size of search indexes. Beyond an application’s ability to index data, there are exogenous factors affecting indexing performance including network speed, disk I/O, and latency. Along with index size and the number of search indexes, these factors can also affect search query performance, resulting in searches that take hours or days to return results.

Another issue facing organizations deploying index-everything solutions is that end users may be creating and modifying documents faster than the solution can index them. As a result, there is a widening gap between the state of data in the wild and the solution’s picture of that data, leading to incomplete search results. Equally troubling, search results may include files that were moved after the search engine indexed them, and so they appear in the results but cannot be viewed, retrieved, or preserved. End users clicking on the link to an item may receive an error similar to the “404 Error: File Not Found” that everyone has experienced when browsing the web. This presents a significant defensibility problem in e-discovery, and IT teams often end up tracking down these missing files one-by-one to ensure they are preserved. The result is that organizations may be exposed to unnecessary legal risk while IT teams have the additional burden of manually tracking down hundreds of files for each legal matter.

A Better Approach to Collection and Preservation

Recognizing the challenges of collection and preservation, Clearwell has developed a targeted approach that enables organizations to defensibly collect and preserve data without increasing the work of IT or exposing the organization to risk. Targeted collection provides an easy way for IT or Legal teams to collect from all critical data sources and securely manage collected data in a preservation store for the duration of a case. Unlike index-everything and preserve-in-place approaches, Clearwell is up and running quickly, delivering value in hours or days without the cost and complexity of lengthy multi-month deployment timelines. In addition, Clearwell’s targeted collect-and-preserve approach has a number of benefits over in-place approaches:

Minimal impact to IT infrastructure: Clearwell only collects potentially relevant data from custodians involved in a case or investigation, targeting resources at the most important data instead of wasting resources on indexing all data across the entire organization. As a result, targeted collection requires less impact to existing applications and storage systems, does not cause significant increases to disk I/O or network consumption, and does not require agents to be installed on client machines or servers.

Finds all critical data: Purpose-built to support the complex and difficult to read file types required by e-discovery, Clearwell can index and search all critical content such as nested container files, encrypted files, images containing text, and hidden content.

Up-to-date collection: Clearwell collects all relevant data for e-discovery by targeting information that is related to custodians in the case. Because this approach is not limited by legacy indexing approaches, Clearwell is able to collect data that has been recently modified or moved.

Maintains existing workflow: With Clearwell, end users are able to continue using their existing workflows and business processes without interruption. Using targeted collection, Clearwell can collect data in the background without altering data where it resides. When users create or modify files in the normal course of business, Clearwell incrementally collects new data automatically.

Reduces risk: Targeted collection significantly reduces the risk of spoliation by retaining data in a secure preservation store, providing a defensible process that maintains chain of custody. As a result, data cannot be tampered with by end users or accidently lost on laptops, desktops, or other data repositories not under the control of IT.

Collecting and preserving evidence are critical steps in the e-discovery process. Solutions that promote indexing everything as the optimal solution for your e-discovery problems might be conceptually promising, but create new challenges for IT and increase risk in practice. As a result, organizations are seeking a solution that enables them to respond effectively to e-discovery without causing major disruptions or exposing the organization to additional risk. Clearwell’s targeted approach solves the challenges of collection and preservation by making it easy to collect data from all critical data sources and preserve data defensibly, without incurring greater risk or disrupting the organization’s business processes.

It is my great pleasure to welcome Matt Nelson to the E-Discovery 2.0 writing team. Matt is our third licensed attorney and, like Dean Gonsowski and Brandon D’Agostino, will be writing on the legal aspects of electronic discovery. In doing so, he will draw upon his prior experience as a litigation attorney at Ropers, Majeski, Kohn & Bentley, and as a legal technology consultant at Kroll and Summation. He’s a really bright guy with a wry sense of humor, and I’m looking forward to hearing his perspective on the broad range of issues that legal professionals engaged in e-discovery wrestle with every day.

Given the size of our writing team, it’s worth taking this opportunity to say a few words about what you (the reader) can expect from our blog. Our team meets on a monthly basis to discuss topics of interest. In doing so, we hope to speak with one voice on broad range of issues:

• Kurt Leafstand and Venkat Rangan will write about the latest technology trends and their impact on electronic discovery;

• Brandon, Dean, and Matt will cover case law and best practices from both a corporate and law firm perspective; and,

• I will continue to write about the business of electronic discovery, and its development as an industry.

All of us aim to inform in a style that’s engaging and easy to read. We hope you enjoy reading our posts as much as we do writing them.

Yesterday, Clearwell announced a new module for identification and collection, which is available with Version 6 of its e-discovery platform. This sits alongside the existing modules for processing/analysis and review/production, extending Clearwell’s capabilities upstream to a part of the e-discovery process typically done by IT. The new module has already been purchased by GlaxoSmithKline, Nisource, and several other enterprises and government agencies, and the initial response has been incredibly positive. I wanted to say a few words about what led Clearwell to add the Identification and Collection Module, and how it’s different from other solutions.

Over the past few years, I have seen a transformation of the e-discovery software market. Previously, there were no specific people within corporations or government agencies dedicated to e discovery, and no formal budget was allocated to it. As a result, purchase decisions were typically made at the departmental level by legal or information security people who could “find the money” by borrowing from other projects. In stark contrast to that, today most major corporations have people specifically responsible for electronic discovery, and many of them have company-wide initiatives to lower costs by bringing e-discovery in-house. Companies are issuing more and more formal RFPs; performing proof-of-concepts as part of the evaluation process; and creating committees of both legal and IT to make purchase decisions.

Some vendors have sought to play up a “gap” between legal and IT teams when it comes to e-discovery. They manufacture survey information claiming that collaboration and communication between legal and IT is decreasing. Our experience has been exactly the opposite. At corporations like Coca Cola, Home Depot, and hundreds of others, we find close, collaborative relationships between legal teams and the IT professionals dedicated to help them. There’s now a new career path, sometimes called “legal IT” or “e-discovery manager”, for technically savvy IT folks who understand legal’s requirements. I was happy to see at LegalTech this year that legal professionals would often come by our booth with a colleague and say to us, “I brought my IT guy with me because I want him to see this”.

It is precisely because legal and IT are working so closely together that they want a single product to manage all their e-discovery activity. That’s what led us to add the Identification and Collection Module.

Why is offering a single product for everything from identification through production such a big deal? Clearwell’s approach offers two main advantages over alternative solutions. First, like earlier versions of Clearwell, the Identification and Collection Module is very easy to use – so much so that, with IT’s permission, legal could even manage the collection process itself. For example, existing products like Guidance Encase require users to write scripts to create filters for targeted collections; with Clearwell, everything is point-and-click through a simple web UI. That makes identification and collection accessible to non-technical users.

Second, because identification, collection, processing, early case assessment, review and production can now all be done using a single product, Clearwell is able to provide end-to-end reporting through the entire e-discovery life-cycle. For example, Autonomy’s disparate e-discovery products (Introspect, Aungate, etc.) require multiple log-ins, all have different UIs, and different data models. With Clearwell, all of these are the same, giving you complete control over your data – at significantly lower total cost of ownership.

You can sign up for a product demonstration or even evaluate the product for free. Take a look – and leave a comment to let us know what you think.

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The Chinese philosopher, Lao-tzu, once said “a journey of a thousand miles begins with a single step.”  This truism has been applied in a myriad of ways over the years, but it applies with equal measure to the process of taming the multifaceted challenge that is electronic discovery.  Simply put, conquering ediscovery is always a journey.  And for enterprises like The Home Depot, they know first hand that you can’t simply look at the end result and wish for the journey to be complete.  Instead, it’s paramount to embrace all the steps along the path and develop good habits that work both for the first and the last mile.

Many enterprises clearly understand the benefits of in-house discovery that include lower processing and review costs, earlier access to case facts, better control over the processes, etc.  But some struggle with how to begin their journey, for any number of reasons (lack of knowledgeable staff, failure to get executive buy-in, inability to build a compelling business case, etc.).  Fortunately, the folks at Home Depot have recently completed their journey and have offered to share secrets they leveraged throughout the process.

In a similar fashion to best selling author’s Stephen R. Covey’s “The 7 Habits of Highly Effective People” David Steel, Sr. Counsel and Barbara Squires, Paralegal at The Home Depot will host a web seminar to walk us through the some of the e-discovery habits that helped them successfully navigate their way through the process.  The web seminar is titled “5 Habits to Create a Highly Effective In-House E-Discovery Process” and it’s free to attend. Since we don’t want to steal their thunder, we won’t divulge their habits now, but suffice it to say that every company can learn from their experiences.  And, after the web seminar I’ll devote more blog time to further expansion of each habit.

Since it’s our raison d’être to help companies complete their e-discovery journey, we’re excited to have The Home Depot on to share stories from their journey, all in the hope that others, just embarking on their own expedition, can be just as successful.

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When I first started working in the electronic discovery industry, I quickly learned two things about Summation: it has a huge installed base of law firm customers, and they all dislike using Summation’s products. It was feedback from these unhappy customers that led companies like Clearwell and kCura/Relativity to enter the review market, and the results are plain to see. While Clearwell and kCura/Relativity are both growing rapidly, Summation has suffered years of declining revenue.

Several people have pointed to poor marketing as the problem, and it’s true most customers are confused. Summation’s products all have different names (iBlaze, Discovery Cracker, CaseVault, CaseVantage), and it is unclear how they relate to one another. But the problem is more fundamental than just marketing. There has been no innovation from Summation for years; its products are difficult to use; and, they don’t integrate with each other. So, naturally, customers switch to more compelling solutions, revenue declines, management cuts costs, talented people leave, service levels deteriorate, more customers defect, and the cycle repeats.

As the management teams at Silicon Graphics, Siebel, or Yahoo! can tell you, once a technology company faces this death spiral, it’s very, very hard to turn things around. But that’s exactly what AccessData must do for its recent acquisition of Summation to work.

On the face of it, you would not expect AccessData to be capable of addressing Summation’s problems. As the #2 player in the forensics market to Guidance Software, it has no experience in legal review. Its customers are enterprises and government agencies, not law firms or litigation support service providers. Its headquarters is in Lindon (Utah), whereas Summation based is in San Francisco. But AccessData has a capable team, and must have some plan in mind. What is it likely to do? My guess is as follows:

• Claim “end-to-end” in the enterprise market: AccessData will likely bundle the iBlaze review platform with its own forensic collection products (FTK) and claim end-to-end coverage of the EDRM model. The products obviously don’t integrate with one another, or even have the same UI, but some customers may not realize how important that is until after they have purchased. This is the same strategy used by Autonomy, which also puts together disparate products (Aungate, Introspect, etc.) and markets them as an integrated package.

• Promote CaseVault and CaseVantage in the law firm market: These hosted review platforms are not widely used. AccessData will be hoping that with better marketing and sales execution, it can drive adoption of them by law firms and litigation support service providers. But most providers today seem pretty happy with Clearwell and/or kCura Relativity, so it’s unclear why they would switch away to CaseVault / CaseVantage.

• Cut costs: On the day the acquisition closed last month, AccessData fired most of Summation’s engineers. That’s understandable, given the shrinking revenue. But it only accelerates the death spiral. With no engineers, it’s impossible to innovate or improve the products.

• Sunset iBlaze product lines: This sounds radical since, according to Katey Wood at the451 Group, iBlaze accounts for 70% of Summation’s revenue. But AccessData may decide to focus its development efforts on CaseVault and CaseVantage, ceasing all investment in iBlaze. Effectively, this means it would “milk” the law firms using iBlaze, and pitch enterprises a product with no real roadmap for improvement. Given how far iBlaze has fallen behind, there is a strong argument that further investments are probably just throwing good money after bad.

It will take a few months before we can say for sure whether these, or other, changes will make any difference. If the experience of other companies is any guide, they may slow the decline for a while, but not reverse it. After all, there may be some people out there using Silicon Graphics computers to access their Siebel CRM systems or search the web on Yahoo, just like there will be some using Summation’s products for document review. But there are fewer and fewer every day.

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On April 1^st, we had some fun by revealing the magical properties of “Clearwell for the iPad.” In truth though, we were only half joking because, at the time, we actually had an application for the iPhone and the iPad in development.

As Clearwell’s user base grew, and we became a mission-critical application to so many people, we learned that our users want access to the product from anywhere, not just when at their desks. In particular, for Clearwell administrators, it’s a lot more convenient logging into cases or checking the status of processing on an iPhone than it is being tied to a computer. So we created this companion application for the iPhone and iPad so they could do just that, as well as view job details, email logs, and generally manage their Clearwell appliances while on the go.

The driving force behind this new application, which we call “iClearwell”, is one of our developers, Gim, who drove its development. Gim also created a video to explain exactly what iClearwell does, which you can see below (yes, it really is his voice – and his pulsating finger).

iClearwell is available for free at Apple’s App Store. I have it on my iPad, and it rocks!

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Much of the business and personal productivity that comes in the digital world  is from email and its unique abilities. Email allows us to communicate in a way that helps us associate context to our discussions, namely in its ability to be chained into a sequential thread when email users reply to or forward emails they previously received. This accomplishes two important tasks: 1) it allows the person sending the reply or forward to get an understanding of the issues so he/she can craft a meaningful response, and 2) it allows the person receiving the response to understand that response in the context of other on-going discussions. Email programs such as Microsoft Outlook, Eudora, and Gmail help by automatically including content from prior emails, thus producing a long chain of reference.

It is no coincidence that emails thus constitute key evidentiary value in the context of litigation. The inherent value captured in emails is what makes email productions central to pre-trial disclosures and the electronic discovery that precedes it. Courts have long recognized that emails are a business record and subject to discovery. Establishing who said what in the context of a matter in dispute is greatly facilitated by examining the thread of emails recorded in email repositories. With respect to electronic discovery, however, email threading presents several unique challenges. The area of greatest confusion and uncertainty has been the determination of privilege when emails are exchanged with in-house counsel and attorneys and whether such emails are protected by attorney-client privilege or not. A central issue is the composition of privilege logs under these circumstances.

There are several legal opinions on the matter of intermingling privileged and non-privileged communications in an email chain. These opinions have left the matter with little clarity, especially regarding whether the entire email thread is privileged or whether individual emails must be separated out and classified as privileged, with a privilege log listing them. Typically, the most recent email in a thread contains all other emails in that thread. Separating out individual emails (i.e., the contained emails) from the containing email would allow for treatment of just the portions of the email thread that may have privilege. When such separation is permitted, some contained emails may be assessed as privileged while others may not. However, it is entirely possible that the contained email is also present as an independent email under possession of the same custodian or another custodian. When it is present, one could argue that the contained email can just be ignored, and if the corresponding email is responsive, one can ignore the contained email. But rarely does a collection include a complete set of custodians, so the question of whether the privilege log should include the contained item in question still remains. In terms of management of review, and for constructing a privilege log, treating the most recent email and all its contained emails as a single entity is less expensive and cleaner than separating and determining privilege status of each contained email.

Another complicating factor is simply a determination of privilege. Does the mere fact that an attorney was listed as a courtesy CC recipient make the entire email privileged? And, when such emails are then forwarded only to an attorney involved in the case, with a legal strategy discussed in the containing email, is only the new content added to the containing email privileged, or does the privilege determination extend to the other contained emails?  Let’s examine a few opinions for guidance.

With respect to privilege there is a significant body of opinions that would suggest that only communications that explicitly seek legal advice are privileged.

“With respect to internal communications involving in-house counsel, a party “must make a ‘clear showing’ that the ‘speaker’ made the communications for the express purpose of obtaining or providing legal advice”, Chevron Texaco Corp., 241 F. supp 2d) at 1076 (quoting In Re Sealed Case, 737 F.2d 94 (D.C. Cir. 1984)). If the legal and business advice are inextricably intertwined, “the legal advice must predominate over the business advice, and not be merely incidental, for the communications to be protected under attorney client privilege.” Evidently, attempts to include an incidental attorney in a thread would not offer privilege protections. However, the issue is complicated if the most recent containing email is indeed a genuine attempt to seek such guidance. Here again, there are two opinions. In United States v. Chevron Texaco Corp., 241 F. supp. 2d 1065, 1074 n.6 (N.D. Cal. 2002), we note that:

“With respect to each series of emails for which Chevron asserts protection under privilege, Chevron breaks the series into each discrete message. In our view, such a representation of the document is misleading. Each email/communication consists of the text of the sender’s message as well as all of the prior emails attached to it. Therefore, Chevron’s assertion that each separate email stands as an independent communication is inaccurate.”The above would have you prepare a single entity with the most recent containing email and all other quoted emails treated as a single unit. On the other hand, we see the opposite opinion in Universal Service Fund Telephone Billing Practices Litigation, 232 F.R.D. 669, 674 (D. Kan. 2005) where “the court strongly encourages counsel, in the preparation of future privilege logs, to list each email within a strand as a separate entry”. In a related ruling, the court notes: “Obviously, a sufficient (i.e., reasonably detailed) privilege log is vital if litigants and judges are to determine whether documents have been properly withheld from discovery.” As mentioned earlier, this can be much more expensive from a review and production standpoint.

In Chemtech Royalty Assoc., L.P. v. United States, Nos. 05-cv-00944, 06-cv-00258, 07-cv-00405, at (M.D. La. Mar. 30, 2009), we get another perspective: “Asserting privilege for an entire email thread in the privilege log, but only describing the last message in the thread is deficient.”

In Baxter Healthcare Corp. v. Fresenius Med. Care Holding, Inc., No. 07-cv-01359, 2008 BL 229777 at (N.D. Cal. Oct 10, 2008), the defendants are ordered to produce a privilege log that “separately identifies the author, recipient(s), copyee(s), and blind carbon copyee(s) for each logged email communication regardless of whether the communication is part of an email string”. The court directive is: “Each email is a separate communication, for which a privilege may or may not be applicable. Defendants cannot justify aggregating authors and recipients for all emails in a string and then claiming privilege for the aggregated emails.”

Thus, the contained emails must be treated as separate privilege log entries.

In Vioxx Products Liability Litigation, 501 F. Supp. 2d 789, 812 (E.D. La 2007) the court notes:

“Email threads in which attorneys are ultimately involved were usually listed on the privilege log as one message.”  Further, “Simply because technology has made it possible to physically link these separate communications (which in the past would have been separate memoranda) does not justify treating them as one communication and denying party a fair opportunity to evaluate privilege claims raised by the producing party.”

Again, the preference has been to separate out individual contained emails as independent emails with corresponding privilege log.

In C.T.  v.  Liberal School District, Nos. 06-cv-02093, 06-cv-02360, 06-cv-02359, 2007 BL 21826 at (D. Kan. May 24, 2007), the court orders the plaintiff to submit an amended privilege log that listed email in a string as a separate entry.

In Se. Pa. Transport Authority v. Caremark PCS Health, L.P., 254 F.R.D., 253, 264-65 (E.D., Pa 2008) court recommends “analyzing emails in chain separately to rule on defendant’s privilege claims”.

Another significant opinion is found in Muro v. Target Corp., 250 F.R.D. 350 (N.D. Ill. 2007). In addition to at least four motions, an in camera review  was requested for identifying the privilege status of eighty nine documents. Here, the court ruled that FRCP Rule 26(b)(5)(A)  does not require that all contained emails be separated out. However, the court sustains Target’s objection to the Magistrate Judge’s ruling that its privilege log was inadequate for failure to separately itemize each individual email quoted in an email string. In Muro, though, you are allowed to treat an entire email as a single entity only if the non-privileged communications in that chain are otherwise disclosed. Hence, if you wish to treat an email as a single unit, you are required to either disclose the individual contained emails from other custodians, or to list them as Derived Emails (see below).

Another important case is the Rhoads Industries Inc. v. Building Materials Corp. of America et al 2008, WL 5082993 (E.D. Pa Nov. 26, 2008), where the court rendered the opposite opinion:

“Each version of an email string (i.e., a forward or reply of a previous email message) must be considered a separate, unique document, and therefore each message of the string which is privileged must be separately logged in order to claim privilege in that particular document.”

Of course, the context of the Rhoades opinion is the statement: “In the world of electronic communications, a series of email messages, among people employed by the client, but working in different locations, can replace the meeting with an attorney and subsequent letter.” However, this opinion is very debatable.

An entirely different approach is suggested in Apsley v. Boeing Co., No. 05-cv-01368, 2008 BL 12035 at (D. Kan. Jan 22, 2008), with the opinion “Although Boeing listed on its privilege log entire email strings, it redacted only the portion of the string that contained legal communications.” While this seems to be a perfectly reasonable approach, wouldn’t this compromise case strategy since the very fact that certain portions of the non-privileged, unredacted emails were being exchanged with in-house counsel and is therefore part of an attorney communication can be damaging?

Suffice it to say, the courts differ in their opinions on how to handle email threads and their privileged logs. It is in this context that the Clearwell E-Discovery Platform’s treatment of email threads is extremely helpful for preparing your litigation response. In fact, Clearwell has received two patents related to email threading, one for constructing email threads and its ranking and another for determining derived emails from other containing emails and de-duplication in the context of original emails. Clearwell has advanced email meta-data and content analytics to piece together all emails of a thread. Furthermore, its Derived Email feature separates out contained emails as complete emails, which are then de-duplicated against other emails that are not derived from a contained email. In situations where such a duplicate is not identified, the derived email is maintained in a special state. Also, the containing email’s thread is separated out in such a way that each individual email’s privilege status can be determined. One can apply either a single- or multiple-record policy satisfying whatever the prevailing opinion is from the bench. Also, Clearwell’s redaction capabilities and its ability to produce the same set of documents for multiple parties allow the case team to provide a quick turnaround if there is a motion to produce either a privilege log or the non-privileged snippets of emails. Such technology can be a lifesaver when it comes to meeting electronic discovery obligations.