e-discovery 2.0

(Editor’s note: This special guest post was written by Chitrang Shah, Clearwell Principal Product Manager. He is an RIT alum and avid hiker who works with our engineering team and lead customers to optimize the product for large-scale review. – Kurt)

As we’ve previously shared, our product strategy throughout 2009 and 2010 was to expand the product footprint across the EDRM as customers were demanding a single, end-to-end eDiscovery product. During this period we successfully expanded from our roots in processing, search and analysis to review and production (August 2009), identification and collection (September 2010) and legal hold workflow (March 2011). Over the last several months, our focus has been to go deep in each of these modules and provide features that deliver even greater return on investment to our customers.

Today, I am excited to announce significant new features and feature enhancements to the Clearwell Review and Production Module and say a few words about what motivated us to build these features and how they enable our customers to further streamline their legal review workflow.

There are several exciting features in this release, but I would to like to highlight three in particular:

1. Ability to seamlessly import production load files

Most matters require reviewing relevant documents alongside the documents received from third parties, opposing parties, and even previous litigations. With the new load file import feature, users can now streamline the process of importing load files with three simple steps.

In Step 1, a step-by-step wizard-like interface guides users though the selection of formatting information such as field delimiters and nested value delimiters, metadata information such as bates numbers, family relationships, tags, folders and any number of custom attributes, and content information such as images, extracted text and native files. When the load file has both extracted texts and native files, the wizard gives users an option to specify which content should be used for searching.

In Step 2, the system performs a deep validation of the load file and generates a report documenting any inconsistencies such as missing bates numbers or missing values for required fields found in the load file. As a result, customers have the ability to quickly find and fix any issues with the load file before the import begins.

In Step 3, the system imports the documents and builds analytics. Once this step completes, the imported documents, including all metadata and content, are available for viewing and searching.

All the analytics capabilities customers are familiar with, such as discussion threads and concept search, are also available for documents imported from load files. This allows users to quickly discover documents in the load file that are conceptually similar to natively processed documents, for example.

2. Support for large scale reviews and productions

As the volume of electronically stored information (ESI) continues to grow, our customers find themselves reviewing and exporting more and more documents, and they need a solution that can cope with the massive growth in data. At the same time, they don’t want to spend large sums of money building a server farm in anticipation of the growth. They want the flexibility to add capacity when needed and remove it when not needed.

Clearwell’s scale-out architecture enables administrators to easily add appliances and allocate them to a particular matter and to a specific task using a point-and-click interface.

For example, if an administrator needs to increase the number of reviewers from 200 to 400 in order to meet a tight deadline, he or she can easily add 2 appliances to the cluster and assign them for review. Once the review completes, the administrator can now easily re-assign these appliances for production, allowing users to easily meet deadlines while reducing their overall hardware costs.

This flexibility allows our customers to maximize the use of their hardware resources while providing infinite review, export and production scalability.

3. Streamlined management of exports and productions

Clearwell provides powerful export options, and while our customers use them extensively for creating a variety of different production formats, they typically standardize on a few. Clearwell’s new case export and production templates provide a quick and easy way for case administrators to define the export format once and use it across multiple cases. When exporting documents, users can simply select a template from the list of visible templates in that case. This capability significantly reduces the overhead associated with managing export formats and allows our customers to produce documents in a consistent format across multiple matters.

Additionally, new production pre-mediation reports automatically identify problem documents and group them by issue type for quick resolution. This enables users to preemptively identify and resolve document production issues without delaying entire productions.

Says Wendy Butler Curtis, chair of Orrick, Herrington & Sutcliffe’s eDiscovery Working Group, “Legal review is one of the most challenging phases of the eDiscovery process. As electronic data volumes continue to grow, it is increasingly important to leverage technologies that can streamline and improve legal review, ensure defensibility and reduce costs. Solutions like the Clearwell eDiscovery Platform enable legal teams to create an iterative eDiscovery workflow that allows for more efficient and effective large-scale review.”

We will be showcasing the new features at ILTA (Booth 816) this week in Nashville, so come see us and let us know what you think.

(Chitrang Shah is a Principal Product Manager at Clearwell Systems, now a part of Symantec, and the lead Product Manager for Clearwell’s Processing & Analysis and Review & Production Modules)

Very soon, Clearwell Systems will become part of Symantec and cease to exist as an independent company. This will bring to a close 6 ½ wonderful years, during which Clearwell has grown from the two founders into a profitable, 240-person company. All told, our team has shipped 6 major versions of the Clearwell E-Discovery Platform, signed over 400 customers and 75 partners in 14 different countries, and become widely recognized as leaders in our industry. As a result, Clearwell’s valuation has increased from effectively zero to the $410 million which Symantec is paying our shareholders to acquire the company, making this by far the largest acquisition of an e-discovery software company to date.

For 6 of Clearwell’s 6 ½ years in existence, it has been my privilege to lead the company as its CEO. These have been, by far, the most rewarding, stressful, exhausting, and exhilarating years of my career. So in this, my final blog post, I would like to reflect on how we got here, and take this opportunity to thank some of the many people who made it possible.

***

In my view, there’s no single thing that makes a company successful. Rather, it’s a distinctive mixture of the right idea at the right time, executed the right way, by the right team, which gets the right lucky breaks and is propelled forward ahead of the competition by surging customer demand. That, in summary, is the story of Clearwell.

Right idea at the right time:

In the early days of a company’s life, when there’s no product and no hint of a customer, the only thing that you have is the idea. This is not the specific idea of what the company will do (that comes later); it’s the idea that there’s a huge change, a shift in the tectonic plates, that creates the opportunity to build a substantial new company. Much of this is about timing. Many changes are obvious over a 10-year timeframe, but it’s very hard to gauge which of them will occur in the 2-4 years that investors are willing to fund a startup venture.

The founding team at Clearwell was attracted by two big trends which combined to produce a profound change. One trend was that, by the mid-2000s, almost all communication within an organization had started to flow through email, as opposed to voicemail, memos, or hallway conversations. The other was that storage costs had fallen to the point where it was almost free to store all the email that people were generating. We realized that these two trends in combination had resulted in the creation of a user-generated written record of everything happening within an organization – something which had never existed before. Our hunch was that there had to be some way of unlocking value from this written record, while still respecting privacy.

Executed the right way:

We came to Clearwell with very specific ideas about how to build a world-class software company. These are too numerous and varied to capture here, but I will give you a few examples. In product development, we have always sought to build our enterprise products as if they were consumer products, so we made sure that they are intuitive and easy to use without any training. We designed them with the sales process in mind, by making them very easy to install and evaluate, so that prospects can try them out for free prior to purchase.  When it comes to marketing, we sought to promote a better way of doing e-discovery, rather than just pitch features, by championing the importance of early case assessments (ECA). With respect to pricing, we made the entry-point price as low as possible to encourage adoption, and pegged it to a metric that scales in line with value.  Strategically, we chose processing, analysis, and review as our entry point into the e-discovery market, because that’s where software provides the biggest, most immediate ROI.

In every area of the business, we brought a distinctive approach, all centered around our view of the ideal customer experience – the experience we would want to have, if we were our customers.

Right team:

The standard playbook for recruiting is to hire people who have done it before, ideally in the same domain. We took a different approach, and instead hired primarily based on personal qualities. Some of our team had no prior experience in enterprise software; many (including me) had never worked in e-discovery before coming to Clearwell. But we all share one thing in common: a relentless drive to win in the marketplace by building better products and providing better service than anyone else.

That hunger to win will trump experience every time. It’s the reason why engineers work through the weekend to resolve customer issues without being asked, or why a salesperson will travel 4 days out of every week to call on customers. It’s something that gets built into the company culture and then self-perpetuates. Our team tripled in size in the space of 18 months, and I never cease to be impressed by the fresh ideas and boundless energy coming from the new generations of “first-timers”.

Right lucky breaks:

Every successful company needs the rub of the green, and there have been many occasions when I’ve marveled at our good fortune. But perhaps our biggest break was that the Federal Rules of Civil Procedure (FRCP) changed for the first time in 38 years in December 2006, defining rules for the treatment of electronic information in the courts. This accelerated the movement from paper to electronically stored information and coincided perfectly with our entry into the market, drawing us into the electronic discovery domain.

Surging customer demand:

It’s an amazing feeling when you achieve “product/market fit”, as we did at the beginning of 2009. The user community among law firms and litigation support firms embraced our technology for ECA, taking our user base from hundreds to thousands. Enterprises woke up to the money that could be saved by bringing electronic discovery in-house, proactively issuing RFPs and creating new positions specifically responsible for e-discovery. Federal agencies began to adopt e-discovery solutions to sift through the vast quantities of data coming to them as part of their regulatory and investigative duties. Essentially, e-discovery became a core business process, just like finance, sales or HR – it became something that every organization had to do. And just as other departments use applications like salesforce.com (sales), Success Factors (HR), or NetSuite (finance) to manage those business processes, so it was that legal departments realized that they needed an application like Clearwell to manage the e-discovery process.

All of a sudden, the business accelerated, sales took off, and we felt ourselves being pulled in every direction at once. In response, we expanded our platform, moving from 1 product to an integrated platform of 4 products; and, we increased our geographic coverage by building out the sales team across North America and establishing beachheads in Europe and Asia. The Clearwell team worked around the clock to respond to customer demand, while at the same time recruiting and training as we added people at a furious pace. We learned that hyper-growth can be painful, but in a good way.

***

When things go well, the CEO often takes a disproportionate share of the credit. I must confess, it would be nice to think that the company’s success is due to some kind of brilliance or magic touch on my part, but the reality is quite different. This has been a team effort from beginning to end and there is a very long list of people who deserve recognition. It’s impossible to capture them all, but I’m going to do my best, by saying a heart-felt “thank you” to:

• Venkat Rangan and Charu Rudrakshi who started the company, raised the first round of funding, and set the DNA of the engineering team;
• Jim Goetz at Sequoia Capital who acted more as co-founder than investor in the company’s first year, and has since been incredibly supportive of the management team;
• Tom Dyal at Redpoint Ventures for his support and insightful advice on strategy; Bill Coughran at Google for helping us think through how best to scale engineering; John Dillon at EngineYard for teaching me what it means to sell software; and, Scott Dettmer at Gunderson Dettmer for his finesse and deft touch in managing the most delicate negotiations;
• Andy Byrne, Anup Singh, Kamal Shah, Ryan Snyder, Soumitro Tagore, Trevor Eddy, and Venkat Rangan for creating a truly outstanding management team built on trust and mutual understanding – it is quite remarkable that in 6 years, the company has only ever had 1 VP Business Development, 1 CFO, 1 VP Marketing, 1 VP Sales, and 1 CTO;
• Amar Laud, Amy Johnson, Andy Kashyap, Aruna Mantripragada, Bill Duffy, Brandon Cook, Cat Lee, Chitrang Shah, Cris Barrett, Dave Fraleigh, David Speicher, Dean Gonsowski, Donna Hui , Doug Kaminski, Ed Hinton, Jason Montgomery, Jason Reeve, Joe Schwartz, Krista Jones, Kurt Leafstrand, Malay Desai, Manish Sampat, Mark Wentworth, Mike Lee, Peter McLaughlin, Sangeeta Relan, Sean Wilcox, Steve Rapp, Subbu Gooty, Teddy Cha, Tom Kennedy, Tom Wells and Umair Hamid for being the leaders who have really defined the company, and without whom we would never have got anything done;
• Clearwell “Class of 2005” for their super-human efforts in shipping Version 1 and launching the company; Clearwell “Class of 2006, 2007 and 2008” for tirelessly iterating until we cracked the code for a profitable business model; and, Clearwell “Class of 2009, 2010, and 2011” for driving the huge expansion of our operations, both in the US and overseas;
• John Petruzzi from Constellation Energy, Joe Tawasha from Charles Schwab, Don McLaughlin from Qwest, Pallab Chakraborty at Oracle, Jesse Hartman at the Department of Health and Human Services, and Ron Best at MTO for being bleeding edge customers who took a chance on a fledgling technology;
• Jeff Fehrman from Onsite; Greg Mazares, Keith Lieberman and the infamous Taylor brothers at Encore; and Paul Tombleson at KPMG UK – for being the first service providers to embrace Clearwell’s technology;
• Debra Logan and John Bace at Gartner; Barry Murphy and Greg Buckles at eDiscovery Journal; Brian Babineau and Katey Wood at ESG; Brian Hill at Forrester; Chris Dale of the eDisclosure Information Project; George Socha and Tom Gelbmann; Nick Patience at 451Group; and Vivian Tero at IDC – for doing so much to help define e-discovery software as a space and make it intelligible to end-customers;
• Deepak Mohan and Brian Dye at Symantec for sponsoring an acquisition that will massively accelerate the adoption of Clearwell’s technology; and,
• Finally, Enrique Salem and the entire Symantec M&A and Integration Teams for giving us such a warm welcome into the Symantec family.

***

It has been a remarkable journey. I feel proud, and humbled, to have been a part of it.

The electronic discovery world is buzzing about the malpractice case filed again Amlaw 100 firm McDermott Will & Emery.  There are a few good summaries here and here, but the gist of the complaint is that McDermott failed to properly supervise the electronic discovery efforts for their client J-M Manufacturing (J-M) in response to a qui-tam investigation.  According to a lawsuit filed by J-M in a California state court, McDermott inadvertently produced 3,900 privileged documents that were handed over to the federal government (and subsequently to a 3^rd party).

In terms of the nitty-gritty, the complaint alleges that McDermott used electronic discovery vendor Stratify (formerly part of Iron Mountain, now absorbed into Autonomy) to process and host the data.  Then, McDermott apparently retained a bevy of contract attorneys to review collected ESI from the 160 custodians, ultimately producing 250,000 documents that were presumably relevant, but not privileged.  The complaint contains the following particulars:

“12. Defendants owed PLAINTIFF a duty to render legal services competently. Defendants breached that duty by, inter alia, producing privileged documents to parties adverse to JME in litigation without obtaining its informed consent, failing to supervise attorneys and vendors MWE contracted with to perform the review and production of documents, and charging JME fees and costs for performance of such work that was not properly performed, or not performed at all.”

Surprisingly, this entire discussion is about a mere complaint filed against a large firm, who assuredly will wage numerous procedural challenges.   Thus, it’s questionable whether this case even sees the light of day.  So, why is it showing up on the radar of so many experts and pundits?  First of all, as Ralph Losey notes:

“This malpractice suit is an important and widely talked about event because it represents the first time, to my knowledge, that a law firm has been sued for e-discovery malpractice. We have all been waiting for this to happen. It was inevitable.”

But, novelty alone doesn’t usually make headlines, unless where there’s also smoke there’s probably fire.  Given the rise in electronic discovery sanctions against counsel, it has long been a fait accompli that a corporate client who experienced spoliation sanctions or an inadvertent production would start pointing fingers at other participants in the process, including the law firm that directed the e-discovery effort or the service provider who hosted the review process.  A recent Duke article noted that “[c]onsistent with the overall increase in sanction cases,…counsel sanctions for e-discovery have steadily increased since 2004.”  The article identified various levels of misconduct as the basis for counsel sanctions — “four cases involved negligence, seven cases involved gross negligence, nine cases involved reckless disregard, and ten cases involved intentional conduct or bad faith.”  Significantly, the article also noted that sanctions can be based on the “counsel’s personal execution of discovery tasks or on the counsel’s role in coordinating and overseeing the client’s discovery.”  That latter element seems to be the case with the claims against McDermott, and coupled with an inadvertent production (the third rail of electronic discovery) it doesn’t seem too shocking that a malpractice action would get filed.

This lawsuit does serve as a cautionary tale for those firms that continue to do things the old fashioned (i.e., 1.0) way.  While not an exhaustive list, this means some or all of the following: employing custodian self collections, using blind key word searches, failing to do sufficient data sampling (at the search and production phases), opting to not utilize early case assessment approaches, lack of search strategy and iteration, failing to optimize the review process, etc.  Surprisingly, old school approaches to electronic discovery are staggeringly common.  In fact, I’ve recently talked to some well traveled practitioners who’ve actually felt like their firms have gone backwards in recent years as prices for basic, block and tackling e-discovery services have plummeted.

If nothing else, we know that attorneys are hyper vigilant about their malpractice insurance.  And, it’s not too hard to see how premiums may go up with increasing e-discovery claims, successful or not.  So, while it’s unclear what will happen to McDermott, if it can happen to an Amlaw 28 firm (with roughly 1,000 lawyers) it can probably happen to any firm who’s not being as diligent as they should.

As a final note of supreme irony, McDermott will likely have to conduct electronic discovery as they defend their electronic discovery malpractice claims.  I wonder if they’ll use Stratify and outside contract attorneys.  I’d guess not.

These days, being mentioned on a late-night talk show is pretty much a stamp of “going mainstream”. This is true of celebrities (notably the One-Man Band that is Charlie Sheen), public figures (Captain “Sully” Sullenberger, who piloted the US Airways plane to a safe landing on the Hudson River), and even infomercial goods (who isn’t familiar by now with the Snuggie?)

In the e-discovery world, we realized just how mainstream this industry is becoming when we made mention on The Daily Show with Jon Stewart. With guest star Fareed Zakaria, fresh off the release of his new book, on set to discuss the American economy and the impact of technology on corporations, audiences were treated to this nugget:

Zakaria:   Machines can do things that people used to. There’s now computer programs that can do stuff that lawyers used to be able to do – discovery and things like that. May not be such a bad thing…

Stewart:   What can lawyers do that computers can’t do?

Lawyer jokes are never in short supply, and leave it to Jon Stewart not to miss a timely jab when one can be thrown. But we took notice because, of all the examples Zakaria could have used for technology’s impact on businesses everywhere — he chose to highlight the role of e-discovery software.

This was far from the first “mainstream” move for the e-discovery industry. In March, The New York Times published a featured – and top-emailed – article on advances in electronic discovery software. In May, leading analyst firm Gartner published the Magic Quadrant for E-Discovery Software, its first Magic Quadrant on the electronic discovery industry. And then in June, there it was: electronic discovery, right alongside CNN’s Fareed Zakaria and all Jon Stewart’s comedic antics on The Daily Show. Taken together, it’s clear that e-discovery is a hot topic on the minds of business folks and, increasingly, mainstream audiences. We’re eager to see where it comes up next – and secretly hoping the SNL sketch team is taking note.

I’ve just returned from a trip across the pond where I spoke at IQPC’s Information Retention and eDisclosure Management conference, which was well attended by both local practitioners and experts from the States.  In addition to numerous discussions comparing and contrasting the US e-discovery and UK e-disclosure practices, there was also a ton of time spent focusing on regulatory compliance.  In particular, the Bribery Act 2010 was a hot topic, not surprisingly given its looming implementation date of July 1.

It occurred to me that both with the Bribery Act and its kissing cousin, the FCPA, the UK and US are strikingly similar in many ways.  We both speak the same language (sort of), but there are any number of things that are just different enough that Americans must take pause.  As an easy example, crossing the street in London can be a perilous journey given our tendency to “look left.”  Fortunately our friends abroad don’t want their lorries dented up by hapless yanks so they kindly paint numerous “look right” signs on street corners throughout their fair city.

As e-discovery and e-disclosure continue to mature in their respective lands, the sense is that the difference will rapidly become obscured, especially in light of how well the countries seem to be collaborating around best practices and civil procedure standards.  During the judges’ panel at the IQPC event, noted e-discovery legends (Judges Grimm, Peck and Facciola) roundly complimented the UK’s disclosure process, often describing how much the US can learn from our allies.

Similarly, it’s interesting to see how the Bribery Act has “gone to school” on the FCPA.  For the past decade or so the UK has been criticized for its Laissez-faire attitude towards commercial bribery, particularly with a glaring gap in applicable legislation (like the FCPA). And, while a wee bit late to the party, the UK finally enacted its anti-bribery statute (on April 8, 2010), curiously dubbed the “Bribery Act 2010,” which in many way leapfrogs the 34 year old FCPA.  While ostensibly similar, the Act differs from the FCPA in a number of ways, many of which broaden applicability. For example, unlike the FCPA, the Act covers bribes to both the public and private sector and does not make an exception (like the FCPA) for facilitation payments (small payments given to public officials to speed up a routine service).  Similarly, the Act applies to all organizations that do business in the UK, even if they’re not based there, and even if the bribery occurs in another country.

The Bribery Act was originally scheduled to become effective in October of last year but, after numerous delays and outcries from the business community, the Ministry of Justice recently issued its “Bribery Act 2010: Guidance” and announced that the Act will finally take effect on July 1, 2011. This guidance has been eagerly awaited by anxious enterprises given the extremely broad potential of the Act.In concert with the recently promulgated prosecutorial guidelines, the guidance document gives some insight into how UK prosecutors (as enforced by the Serious Fraud Office) will initially decide who to pursue and then how the Act will be applied.  Fortunately, the promulgated guidance documents suggest that the Act is “directed at making life difficult for the mavericks responsible for corruption, not unduly burdening the vast majority of decent, law-abiding firms.”

To this end, the Guidance states that “[i]t is a full defence for an organisation to prove that despite a particular case of bribery it nevertheless had adequate procedures in place to prevent persons associated with it from bribing.”  It is these “adequate procedures” that provide a safe harbour of sorts and therefore should be perused quite carefully by impacted organisations to ensure that their compliance programs are up to muster.  The following six “guiding principles” are designed not to be prescriptive or “one-size-fits-all,” but rather to suggest a “risk-based” and proportionate approach to managing bribery risks.

1. “Proportionate procedures: A commercial organisation’s procedures to prevent bribery by persons associated with it are proportionate to the bribery risks it faces and to the nature, scale and complexity of the commercial organisation’s activities. They are also clear, practical, accessible, effectively implemented and enforced.
2. Top-level commitment:  The top-level management of a commercial organisation (be it a board of directors, the owners or any other equivalent body or person) are committed to preventing bribery by persons associated with it. They foster a culture within the organisation in which bribery is never acceptable.
3. Risk assessment: The commercial organisation assesses the nature and extent of its exposure to potential external and internal risks of bribery on its behalf by persons associated with it. The assessment is periodic, informed and documented.
4. Due diligence: The commercial organisation applies due diligence procedures, taking a proportionate and risk based approach, in respect of persons who perform or will perform services for or on behalf of the organisation, in order to mitigate identified bribery risks.
5. Communication (including training): The commercial organisation seeks to ensure that its bribery prevention policies and procedures are embedded and understood throughout the organisation through internal and external communication, including training, that is proportionate to the risks it faces.
6. Monitoring and review: The commercial organisation monitors and reviews procedures designed to prevent bribery by persons associated with it and makes improvements where necessary.”

Organisations looking for clarity should certainly start with an analysis of how well their existing anti-bribery procedures (many likely designed with the FCPA in mind) map to the six principles.  The hope of many is that the Bribery Act won’t inherently require a complete reboot for entities trying to comply.  Instead, a more measured and reasonable goal should be to have complaint entities examine the Act to see if any augmentation is necessary.  Fortunately, the Guidance principles are peppered with terms like “proportionate”, “risk-based” and “practical” that should give solace to the entities that had significant indigestion when the Act was first released.

Traditional e-discovery solutions may very well be called into duty to help augment an organisation’s “adequate procedures” particularly regarding the “risk assessment” and “due diligence” principles.  These two principles specifically call out procedures that proactively facilitate:

• Identification of the internal and external information sources that will enable risk to be assessed and reviewed.
• Accurate and appropriate documentation of the risk assessment and its conclusions.
• Conducting direct interrogative enquiries, indirect investigations, or general research on proposed associated persons.
• Appraisal and continued monitoring of recruited or engaged “associated” persons may also be required, proportionate to the identified risks.

Re-purposing of e-discovery tools in this compliance context makes sense given how things have played out here in the States with the FCPA and provides yet another way to rationalize bringing solutions in-house.  In this scenario the advanced analytical components will likely come more into play than will the downstream review and production elements.  This expansion of traditional e-discovery concepts, procedures and applications is logical and coincides with a leftwards movement on the EDRM spectrum.  It’s also aligned with rapidly expanding notions of IMRM and information governance.  I postulate that soon it will be too limiting to just talk about pure “e-discovery”tools since it inherently leaves out the rest of the compliance story.  In addition to looking “right” we’ll also need to look “left” (on the EDRM) to take into account use cases like the Bribery Act.

It seems all too easy to poke fun at Charlie Sheen’s antics of late.  And, while they serve as cautionary tales in numerous contexts, his use of social media to launch his “tiger blood” fueled rampage against his former employer may mean that these rants may actually turn into evidence someday soon in his breach of contract action.  On one hand, his public meltdown was surely a high water mark for social media as a window into the real-time (can’t look away) train wreck that is now Mr. Sheen’s career.  After all, he now has over 3 million Twitter followers and for those who don’t expressly follow his now infamous rants (e.g.,“#winning”) other media outlets stand by to repost and re-tweet every scintillating (less than 140 character) proclamation.

For those who think that they’d prefer to have less Sheen in their daily diets, let’s use his 15 minutes of über-fame to examine the impact of social media on the traditionally email oriented electronic discovery process we’ve all come to know and love.  On balance, while the electronic discovery and regulatory issues are all fundamentally the same, the social media genre does genuinely pose a range of tactical and strategic challenges.

Accept Reality and Plan Accordingly

For many organizations, it’s easy to exhale as they’ve finally reigned in some of the email chaos during the 2000s.  But, this small victory in the larger information management war has been eclipsed by new challenges posed by social media.  The problem isn’t just that the types (Twitter, LinkedIn, Facebook, Flickr, YouTube, etc.) are increasing at a mind numbing speed, but the volumes of accumulated data (1 billion tweets per week) is also proliferating wildly.  A recent article published under the Sedona Conference’s aegis, The Impact of the Internet and Social Media on Records and Information Management: Unexpected Bedfellows Highlight the Need for Effective Information Management –Now More than Ever points out:

“Most commentators agree that, if social networks in the workplace are inevitable, corporations must resign themselves to the inevitable and prepare accordingly. …

To combat these risks, companies must understand the interactions between IT and legal and how they intersect in the world of Records and Information Management. Companies must also employ a cross-discipline approach to issues in order to properly address access rights, digital security, Records and Information Management policies and programs, short and long-term data storage strategies, audit processes, enforcement protocols, incident and litigation response plans, and employee education programs.”

The authors correctly state: “[h]ard decisions need to be made, and resources committed, but an ounce of current prevention now may certainly outweigh the inevitable pound of information loss.”  This “pound” is most often paid out by organizations in response to electronic discovery costs, which are axiomatically linked to the amount of electronically stored information (ESI) a company needs to collect, process, review and produce for the matter at hand.

So, like the first stage in the Kübler-Ross grief process (denial), organizations need to accept the reality of social media, understand the implications (cost, risk, information security challenges, etc.) and start to plan accordingly.  Yet, the denial seems to be ever-present.  In a recent survey by the Electronic Discovery Reference Model (EDRM) it was shockingly noted that “[w]ritten policies for social media are non-existent,” with 85 percent of industry professionals admitting that “no written policies existed within their organizations regarding the preservation of data for any of the wildly popular social networking sites.”

Deploy the Right Information Governance Policies

Step one in this challenging task is to reign in the authorized/unauthorized use of social media.  This likely doesn’t equate to the wholesale prohibition of all social media (which would be nearly impossible to enforce).  Instead, the goal should be to define what is permissible via policies and procedures, and that in turn should be used to identify expectations of reasonable corporate conduct.  This effort should inherently recognize that there are legitimate business purposes (ideally with defined corporate objectives), as well as individualized usages (that nevertheless may still be supportive of company goals) for the use of social media.  In all instances it will be important to calculate the benefits of the social media activity (increased collaboration, real-time communication, ubiquity, etc.) with the risks (lack of information control, reduced productivity, etc.).

Organizations may also consider which of their own social media forays constitute a business record and whether or not they should be proactively archiving/capturing/preserving such ESI to create a robust document trail if social media ever becomes a factor in litigation.  Unfortunately, as with a number of other quickly developing paradigms such as cloud computing, there’s often a “ready, fire, aim” approach where the legal, risk and compliance ramifications aren’t well thought out prior to deployment.

Social Media Use Cases Proliferate

In just the past few months there have been numerous instances where social media has taken center stage in the electronic discovery and compliance realms.  Here are just a few recent examples:

• Facebook – In what’s been called the Facebook firing case, the National Labor Relations Board (NLRB) jumped in to chastise an employer for allegedly firing an employee due to a Facebook post (where she allegedly called her boss a “mental patient”).  The NLRB said that policy was in violation of the National Labor Relations Act, which gives employees the right to discuss “the terms and conditions of their employment with others.”
• LinkedIn – In a recent breach of contract action, an employer claimed it had evidence of improper solicitation of its employees through the LinkedIn connections of one of the defendants.

Electronic Discovery Costs Rise in Concert with Social Media

While “ESI is ESI” to some extent, there are tactical challenges with conducting electronic discovery of social media.  Using the EDRM model as a guide, the first main hurdle will be Identification.  In this stage, the challenge will be to identify (ideally through data maps and corporate policies) the instances of social media that are being legitimately used within an enterprise.  This process is typically linked to key players, versus searching the entire data universe for specific key terms.

Once this thorny issue is confronted, the even bigger challenge involves determining how to manage the risk-laden Preservation process.  Here, the highly dynamic nature of social media stands in contrast with its email counterpart, which in many ways was designed to be used in a linear, threaded format.   The preservation of social media has two main challenges.  The first one is access since the information may be private or semi-private.  In this setting, the recent case of Romano v. Steelcase Inc. (N.Y. Sup. Ct. 2010) shed light on some of the privacy issues:

“[W]hen Plaintiff created her Facebook and MySpace accounts, she consented to the fact that her personal information would be shared with others, notwithstanding her privacy settings. … Since Plaintiff knew that her information may become publicly available, she cannot now claim that she had a reasonable expectation of privacy. As recently set forth by commentators regarding privacy and social networking sites, given the millions of users, ‘[i]n this environment, privacy is no longer grounded in reasonable expectations, but rather in some theoretical protocol better known as wishful thinking.’”

Assuming the privacy issue can be overcome, the next issue is encountered during the Collection phase, since it will be hard to actually preserve social media in situ because the content is dynamic and at the whim of the user and the applicable site.  Aside from a few recent developments like Facebook’s “Download Your Information” feature and the library of Congress’ decision to archive all tweets since March, 2006, most social media ESI is fleeting and hard to collect.  The current brute force methodology is to simply take screenshots of the relevant blog, tweet or status update.  The challenge with this approach isn’t necessarily with admissibility (see below).  Instead, this static modus operandi makes it nearly impossible to utilize analytical tools to search and review the social media content.  Assuming the use cases and volumes continue to proliferate at current speeds (which is a safe bet), then leveraging analytical tools becomes that much more important in the effort to control costs.

Over time, enterprises will attempt to funnel users into corporate social media platforms that have governance abilities built in, particularly export functionality that will permit more advanced search and analytics from purpose-built e-discovery applications.  But, for now, the herding cats exercise will continue as the corporate community tries to keep up with the faster moving user base.

Admissibility is an Open Question

Not to be forgotten, the core underpinning to a successful collection of social media content is the ESI’s admissibility, since the ability to use data in court is the sine qua non for conducting the electronic discovery process in the first place.  In the seminal case on the admissibility topic, Lorraine v. Markel Am. Ins. Co., (2007), United States Magistrate Judge Paul W. Grimm noted that “[v]ery little has been written, however, about what is required to insure that ESI obtained during discovery is admissible into evidence at trial.”  He went on to note that “[t]his is unfortunate, because considering the significant costs associated with discovery of ESI, it makes little sense to go to all the bother and expense to get electronic information only to have it excluded from evidence or rejected from consideration during summary judgment because the proponent cannot lay a sufficient foundation to get it admitted.”

While it’s difficult to quickly summarize the authentication requirements for social media, it is an important aspect that can be achieved a number of ways (pursuant to FRCP 901, which only provides illustrations).  The most likely course would be to utilize the “personal knowledge” approach, which permits authentication by testimony “that a matter is what it is claimed to be.”   Other approaches, such as utilizing metadata (which works well for more static ESI) will be less applicable for social media since it is more ephemeral.

Conclusion

Many have proclaimed that social media will soon render email obsolete as the primary form of corporate communication.  While this remains to be seen, social media is quickly elbowing its way into the electronic discovery conversation and this new kid on the block needs to be taken seriously, or the unwary practitioner may unwittingly find out (via tweet) that their case has been dismissed because of spoliation.

As the buzz around Watson and its foray into human-like (actually super-human) performance subsides, it may be time to take stock of what all the fuss was about. After all, we’re all used to computers doing better than humans in many things and even take its superior store of knowledge for granted. And, on the surface, we get answers to questions on pretty much anything from a simple Google or Bing search. So, what really is the big deal and is it even relevant in the context of electronic discovery?

For those not clued in on this, Watson is a brainchild of a four-year effort from 20-25 researchers at IBM, to build a computing engine that would successfully compete at champions-level at the popular quiz show, Jeopardy. Although it blundered on a couple of answers, it competed very well, with a wide margin of victory. Several industry experts that learned of it and watched the show have lauded this as an accomplishment at the same scale or even better than the IBM Deep Blue beating Chess Grand Champion, Gary Kasparov, in 1997. So, let’s examine if this is indeed worthy of the accolades it has gotten.

Behind Watson is an impressive piece of hardware – a series of 90 IBM Power 750 nodes, adding to 16TB of memory and 2,880 Power7 processor cores delivering a staggering 80 teraflops of peak performance.  All the hardware is highly inter-connected with ability to work on problems in parallel, but still marching to a final result in three seconds or less – just fast enough to beat the human buzzer. Some highlights of the computing infrastructure from the hardware architect, Dr. James Fan, at IBM indicate that the three-second timeframe meant the entire corpus of 200 million pages was loaded into memory. Also, with several processors simultaneously working on pieces of the problem, they place very high I/O requirements. The hardware supports a multi-processing OS, with virtualization, in a workload optimized system. The software drives the hardware using thousands of dense threads, with each thread of execution processing a large chunk of work with minimal context switch. Also, given the large number of cores, each thread is optimally allocated to a core. Branded as DeepQA, the software executes a series of complex algorithms in order to solve a very specific problem: winning on Jeopardy.

First, the Jeopardy game provides categories of clues. Some categories help in understanding the clue, while others are simply misleading to a computer. Next, the clue is revealed and one needs to determine what the clue is really asking, since many clues do not ask for a factoid with a direct question, but rather is a composition of multiple sub-clues, each related to another in some linguistic, semantic, syntactic, temporal or other forms of connection. The decomposition of clues and figuring the relationships is a challenge even for humans. Finally, after one understands the clue, you then have to hone in on an answer with some level of confidence, within a three-second window, and must activate the answer buzzer ahead of the rest of the competitors. Besides individual clues, one has to also devise an overall game strategy for selecting the next category, selecting a clue within that category, how much to wager on the Double Jeopardy and the Final Jeopardy. Overall, the game is a complex amalgamation of knowledge, language analysis, gaming strategy and speed of recall of answers.

The software architecture of the DeepQA system is documented in a paper published in AI Magazine. The team built several components to address each area of the problem, with many independent algorithms in each component.  There are lots of complicated technical details, but the final outcome is a human-like response.

A question on that anyone who examines its inner workings has is whether the system is really natural language processing, or statistical language analysis, or machine learning or some sort of ad-hoc program, which doesn’t fit any traditional area of analytics. It does appear to be an combination of several techniques, which may mirror exactly how humans go about solving these clues. We seem to have a large collection of knowledge, initially unconnected but the category, the clue, the hypothesis all appear to generate word and concept associations and a fuzzy evaluation of confidence measures which all converge into a confidence with which a competitor answers a question. It is the replication of these processes by algorithms that makes it truly an astounding achievement.

Given the success of DeepQA’s performance, a natural question is whether it has any practical value for helping us solve day-to-day problems. More specifically, can it cope with the information overload and the challenges of e-discovery posed by that mass of information?  Use within e-discovery context has been explored by several authors, most notably, Robert C. Weber of IBM and Nick Brestoff in recent Law.com articles. Their analysis is based on the ability to explore vast volumes of knowledge. But really, what DeepQA tackled is something more significant – the inherent ambiguity in human spoken and written communication. Our natural instincts are to employ subtle nuances, indirect references, implicit assumptions, and incomplete sentences. We tend to leverage prior and surrounding context in most of our communications. It’s just the natural way of communications, since doing so is actually very effective. We assume establishing context is redundant, unproductive and unnecessary as it tends to make communication repetitive. By not employing a rigid structure in how we write, we are able to bring to bear concise exchanges that span a large volume of information.

If the last two decades is an indicator, the nature of communication is getting less formal, with emails, instant messages, tweets, and blog posts replacing well-crafted formal letters and memos. And, forcing individuals to communicate using rigid, unambiguous text in order for it to be processed by computers easily would mean a huge change in behavior in how people communicate. Any action that contemplates such a change in behavior across billions of people is simply not going to occur. What this means is that the burden for automated analysis using computing algorithms is even greater. This is what makes the discovery of relevant content in the context of e-discovery a very hard problem, one that is worthy of the sort of technological prowess employed by DeepQA team.

Given that our appetite for producing information is ever-increasing, while its discoverability is getting harder, taking the work of DeepQA and adapting it to solve e-discovery needs has the potential to make significant improvements in how we tackle the search, review and analytical aspects of e-discovery.  DeepQA took an easily articulated goal of answering at least 60% of the clues with 85% precision in order to reach champion levels. That was sufficient to win the game. Note that there was never an attempt to get 100% of all clues, with 100% confidence. In the realm of e-discovery, we would be looking at taking a very general production request such as the TREC 2009 Topic 201 “All documents or communications that describe, discuss, refer to, report on, or relate to the Company’s engagement in structured commodity transactions known as prepay transactions.” and use just such a simple articulation of the request to produce relevant documents. It is the core algorithms of machine learning, multiple scoring methods, managing relevance and confidence levels along with traditional information retrieval methods that form the ingredients of the new frontier of automated e-discovery. Beyond e-discovery, application of DeepQA algorithms for business analytics also has significant potential, where fact and evidence-based decision making using unstructured data is likely the norm. DeepQA’s very public Jeopardy challenge has shown that the ingredients needed for enabling such problem solving is well within the realm of possibility.

I was at Sedona midyear meeting last week and during Ken Withers’ excellent discussion of recent e-discovery case law, a few thoughts occurred to me. First, there are so many cases coming out now each week it’s hard to stay above the fray and mine for useful nuggets. The task is a bit Sisyphean, so folks like Ken (who keep a rolling index of cases) are particularly helpful. Next, I was struck by how hot Pension Committee still is, even after almost a year and a half. Certainly, this ongoing spotlight wasn’t an accident, and it’s almost certain that Judge Scheindlin is pleased by the ongoing debate.

I frequently get questions from enterprise clients regarding which cases they should know about, and so I put together an EDRM oriented (left to right) list for folks who just can’t get to all the latest cases. While it’s not an annual roundup per se, I do think it’s a bit more functional for busy electronic discovery professionals who need to stay current. So, here’s the buzz index of cases arranged by topic:

Preservation: The Legal Hold Gold Standard

Case: Pension Committee of the Univ. of Montreal Pension Plan, et al., v. Banc of America Securities, LLC, et al. (S.D.N.Y. 2010).

Summary: The dispute focused on claims by a group of investors who brought an action to recover losses of $550 million dollars stemming from the liquidation of two British Virgin Islands based hedge funds. Unlike many typical e-discovery disputes, this instant action focused on the conduct of the plaintiffs as they attempted to deal with the often murky landscape of electronically stored information (ESI) preservation, collection and production. Judge Scheindlin goes out of her way to crystallize duties and identify the type of conduct that can cause an e-discovery breach. “After a discovery duty is well established, the failure to adhere to contemporary standards can be considered gross negligence. Thus, after the final relevant Zubulake opinion in July, 2004, the following failures support a finding of gross negligence, when the duty to preserve has attached:

• to issue a written litigation hold;
• to identify all of the key players and to ensure that their electronic and paper records are preserved;
• to cease the deletion of email or to preserve the records of former employees that are in a party’s possession, custody, or control;
• and to preserve backup tapes when they are the sole source of relevant information or when they relate to key players, if the relevant information maintained by those players is not obtainable from readily accessible sources.”

Why it’s (still) important: First of all, Pension Committee is written by Judge Scheindlin, who is the most famous electronic discovery jurist on the planet. Next, since she’s in the Southern District of New York, it means that folks even in other jurisdiction that aren’t bound by her opinions still must take heed given the fact that New York is home to so many multinational organizations. Finally, her opinion is the clearest (even if disputed) articulation regarding the standard of care for the issuance of legal holds and the duty to preserve ESI. She attempts to categorically define conduct that is grossly negligent and therefore susceptible to extreme sanctions, including spoliation inferences and terminating sanctions. Fortunately, she recognizes the numerous challenges associated with electronic discovery. And, so as to blend in a healthy dose of reality Judge Scheindlin also said: “In an era where vast amounts of electronic information is available for review, discovery in certain cases has become increasingly complex and expensive. Courts cannot and do not expect that any party can meet a standard of perfection.”

In the end, Pension Committee, was the case of the year in 2010 and even in 2011 it’s generating an unprecedented level of retrospectives (here and here). It may be because Judge Scheindlin’s relatively bright line standard has created so much debate, but in the end the Pension Committee discussion will likely continue for the foreseeable future (perhaps only ending when/if the culpability rules are amended to create a unified national standard).

Preservation: Why Preserve in Place is Risky?

Case: Wilson v. Thorn Energy, LLC, (S.D.N.Y. 2010).

Summary: In Wilson, the defendant corporation identified a flash drive that contained relevant ESI, but rather than copying that data safely to a centralized evidence repository, the defendant’s employee chose to hold on to the drive, putting it instead into a desk drawer. When the files were requested for review and production, the files could not be read from the drive. The defendant’s employee attempted to recover the ESI contained on it, but those efforts failed. Granting plaintiffs’ motion for sanctions, the court ordered that defendants would be precluded from offering evidence at trial concerning the data contained on the discarded drive.

Why it’s important: In today’s e-discovery world, many organizations are instituting hold processes via manual solutions and then waiting weeks or months to ultimately collect the ESI. Wilson shows the danger of simply preserving data and makes the argument that you should either “collect to preserve” or collect very shortly after the litigation hold notice goes out. While focusing on a certain media type (flash drive), this analysis can be extended to any digital system containing ESI that inherently has some set failure rates or can be imagined to fail without express, conscious action (due to loss, theft, recycling, etc.).

Identification & Collection: “Manual” Collections Come Under Fire

Case: Green v. Blitz U.S.A. (E.D. Tex. Mar. 1, 2011)

Summary: In this case, Plaintiff sought to re-open her lawsuit despite prior settlement upon learning that defendant had failed to produce relevant documents. Finding that defendant had committed discovery abuses, including failing to disclose relevant evidence and failing to issue a litigation hold, the court ordered defendant to pay plaintiff $250,000, to provide a copy of the court’s order to plaintiffs “in every lawsuit proceeding against it” for the past two years and to file the court’s order in every case that defendant is involved in for the next 5 years. It was revealed that the employee “solely responsible for searching for and collecting documents relevant to litigation” issued no litigation hold, conducted no electronic word searches for emails, and made no effort to speak with defendant’s IT department regarding how to search for electronic documents.

Why it’s important: Green is the latest in a line of cases [See also Ford Motor Co. v. Edgewood Properties Inc., 257 F.R.D. 418 (D.N.J. 2009) and Phillip M. Adams & Assoc., LLC v. Dell, Inc., 621 F. Supp. 2d 1173 (D. Utah 2009) ] that have been highly critical of manual (or self) collection efforts by the individual custodians. Historically, if the custodians were monitored/supervised enough by counsel, this manual collection process was largely deemed defensible, but it looks like this behavior is simply too risky for any conservative enterprise. The better practice is to leverage the custodians to point out where relevant ESI might exist and utilize software tools to conduct broad collections from key players. While it’s not necessary to use IT tools to collect data immediately for all custodians who have received a litigation hold notice, it’s probably unreasonable to not quickly collect ESI (via formal, IT based methods) from at least some subset of key players. The main point is that this isn’t an all or nothing calculation. Costs, risks and benefits should all be carefully evaluated and documented, in case there’s a downstream challenge.

Analysis & Review: Failure to Test Keywords and Sample

Case: Mt. Hawley Ins. Co. v. Felman Prod., Inc., (S.D. W. Va., 2010).

Summary: In this case the court examined the reasonableness of plaintiff’s precautions to prevent disclosure of email, which was inadvertently produced by the plaintiff amidst “a massive disclosure of e-discovery.” The Mt. Hawley court applied the five-factor test established in Victor Stanley, Inc. v. Creative Pipe, Inc. (D. Md. 2008) and found that the producing party had not taken reasonable steps during discovery. In particular, the court was unwilling to find that the inadvertent production of 377 privileged documents was “solely attributable” to a technological glitch and instead found that plaintiff and counsel “failed to perform critical quality control sampling to determine whether their production was appropriate and neither over inclusive nor under-inclusive.” This finding meant that their attorney client privilege was waived as to the subject documents.

Why it’s important: Mt. Hawley demonstrates why sampling and keyword search term formulation is critically important to any defensible discovery effort. In many instances where “blind” keyword strategies are used, the producing party is taking on an undue risk, in essence flirting with the “3^rd rail” of electronic discovery (inadvertent production). Blind keyword searching (followed by brute force review and production) is sadly still a very common practice today. My hope is that cases like Mt. Hawley will force the blissfully ignorant practicioners to take stock of their risky practices and get with contemporary best practices like ECA, sampling, iterative search and the like.

Conclusion

Simply by creating such a list, I’m sure to leave off cases other folks think are more buzz worthy. But, for me, having a few good legal chestnuts is better than trying to boil the ocean and synthesize all the available case law. If you have any comments I’d be eager to hear (good, bad or indifferent).

In past blogs I’ve discussed a number of cases that have expressed skepticism over the self collection of electronically stored information (ESI) in the electronic discovery process.  In many of these cases, the reviewing judge or magistrate has looked at this process with an increasingly jaundiced eye, in some cases using the self collection component as part of its rationale for sanctions.

My conclusion up until now has been that this collection methodology (where employees manually select and potentially harvest their own data) could be defensible if properly executed; meaning with the requisite level of attorney guidance and oversight.  And, while this is still technically accurate, I think the pendulum has swung far enough to proclaim that this approach is simply far too dangerous for most enterprises, except perhaps those that are extremely risk tolerant.

While there was no particular straw that broke the camel’s back, the trend in the case law now seems to be moving inextricably in one direction – i.e., that self (or manual) collection is no longer safe enough for average enterprises.  Just like tight rope walking without a safety net, self collection protocols aren’t inherently doomed to failure, but there isn’t much (probably any) margin for error.

In the recent case of Green v. Blitz U.S.A., (E.D. Tex. Mar. 1, 2011) we see yet another example of self collections gone awry.  In Green the Plaintiff sought to re-open her lawsuit despite a prior settlement, once she suspected that the defendant had failed to produce relevant ESI.  Finding that defendant had committed numerous discovery abuses, including not disclosing relevant evidence and failing to properly issue a litigation hold, the court put the hammer down, issuing a wide range of sanctions:

• Defendant had to pay plaintiff $250,000
• Defendant had to provide a copy of the court’s order to plaintiffs “in every lawsuit proceeding against it” for the past two years
• Defendant had to file the court’s order in every case that it is involved in for the next 5 years.

Self collection was again a material culprit in the culpable behavior.  It was revealed that the employee “solely responsible for searching for and collecting documents relevant to litigation” issued no litigation hold, conducted no electronic word searches for emails, and made no effort to speak with defendant’s IT department regarding how to search for electronic documents.  To exacerbate matters, the main individual in charge of collections was also closely tied to the research and development of the “flame arresters” that were at issue in this exploding gas can case.

Adding fuel to the fire (pun intended) was the fact that the responding company failed to locate or collect emails with the search term “flame arrester.”  The court went on to note that some of the smoking gun emails not only contained this “most obvious term to search for in electronic documents in this case”, but in fact “flame arrester” was used in the title of certain emails.

While folks have called this practice an example of a “fox guarding the henhouse,” in my mind it’s less that custodial bias renders self collection too risky for prime time.  While there are certainly examples like the Green case where bias likely was an issue, the bigger problem is that any significant reliance on custodians to direct a collection process (even a well supervised one) has too many failure points.  The most obvious (and innocent) scenario is where custodians simply can’t remember if they had responsive ESI or where such information might reside.  This problem can be particularly acute given the fact that litigation is almost always conducted in the rear view mirror.  Since I often can’t remember what I had for breakfast I don’t find it surprising that a custodian might not recall if they had data relating to a discrete issue 4-5 years ago.

As such, the contemporary “best practice” for the collection of ESI is quickly evolving past the old manual collection workflow.  Technology is rapidly making it quick and painless to conduct searches for blatantly relevant ESI (like emails with “flame arrester” in the title).  Not only can you conduct basic searches with existing technologies, but recent advancements around concept search and other analytical tools makes the failure to leverage these technologies seem that much more unreasonable.  For example, in the recent case of Northington v. H&M Int., (N.D. Ill. Jan. 12, 2011) the defendant was sanctioned, in part, because they didn’t search for minor misspellings of the plaintiff’s name.

When a court sees manual blunders like that in the Green case it’s not surprising to see such missteps cast as at least negligent and perhaps even more culpable.  This conclusion is made even easier when organizations like the Sedona Conference (in its Best Practices Commentary on the Use of Search and Information Retrieval Methods in E-Discovery) state:  “[i]n many settings involving electronically stored information, reliance solely on a manual search process for the purpose of finding responsive documents may be infeasible or unwarranted. In such cases, the use of automated search methods should be viewed as reasonable, valuable, and even necessary.”

Green is now the latest in a line of cases [See also, Ford Motor Co. v. Edgewood Properties Inc., (D.N.J. 2009) and Phillip M. Adams & Assoc., LLC v. Dell, Inc., (D. Utah 2009)] that have been highly critical of self collection efforts by individual custodians.  The better practice is to utilize technology to conduct collections from key players and perhaps leverage the custodians (and technology) to point out where relevant ESI might exist.  As such, a belt and suspenders approach is undoubtedly the safer way to go.  In this “dual protection” scenario “key custodians still search, identify, and self-collect what they think are relevant emails, but, as a fail safe, IT also collects all of the key custodians’ emails. Then attorneys search and identify relevant documents from this full, uncensored, unfiltered, collection. This double effort guards against the intentional and unintentional mistakes that can sometimes arise in self-collection.”

We know that electronic discovery is never going to be a perfect process, but self collections simply inject too much risk into an already complicated process.  Now is the time to change tactics and stop tight rope walking without a safety net.  After all, no enterprise wants to be the next to endure a highly publicized fall.

It’s widely known that Microsoft is a Clearwell customer, and uses our product for e-discovery across a wide range of matters. One such matter is the case of Datel Holdings v. Microsoft Corporation, which is presently in District Court for the Northern District of California. As part of those proceedings, Microsoft mentioned Clearwell in its Opposition to Datel’s Motion to Compel that was ruled upon on March 11, 2011:

Defendant explains that after potentially responsive documents were collected from custodians, they were loaded into a computerized document processing system known as “Clearwell.” Clearwell extracted metadata from each document and converted the documents into a format that allowed for text searching. Once the documents were processed through Clearwell, they were entered into an online platform, where they were reviewed by attorneys. For reasons still unknown to Defendant, Clearwell truncated some “Re-auth” documents during processing.

In itself, this sounds unremarkable. But we’ve noticed that some of our small competitors have been using this statement, and particularly the last line of it, to suggest that there are problems with the Clearwell product.

We realize that, as the market leader, there will always be small competitors seeking to leverage any opening to their advantage. Usually, we ignore this nonsense. But this time, to set the record straight, we asked our customer at Microsoft to respond on our behalf

Here’s what Joe Banks, who manages the e-discovery team at Microsoft, wrote about the issue and gave us permission to publish:

Statement from Microsoft:

In regard to the Declaration of Hojoon Hwang referenced in the 3/11/11 Order granting in part and denying in part plaintiff’s Motion to Compel in Datel Holdings LTD v. Microsoft, No.C-0905535EDL in the Northern District of California, the statement ‘For reasons still unknown to Defendant, Clearwell truncated some ‘Re-auth’ documents during processing’ should be corrected.  Microsoft subsequently learned that the cause of the truncation was the Microsoft software (AD/RMS Bulk Protection Tool) employed to decrypt previously encrypted content, and the truncation issue had nothing to do with Clearwell’s technology whatsoever.  Shortly after Mr. Hwang’s declaration was filed, he clarified – on the record in open court on February 22 – that Microsoft’s decryption process was the true cause of the data truncation:

6 A lot of Microsoft documents, including e-mails, are

7 encrypted when they are sent. And for production purposes, we

8 have to decrypt it. In that process, some of the material got

9 cut off.

Microsoft does not use Clearwell technology to decrypt its data.  In actuality, Clearwell’s Engineering and Support teams were instrumental in helping to identify the root cause of the truncation issue.  Microsoft continues to use Clearwell’s processing and analysis technology on this matter and greatly appreciates the partnership and support Clearwell provides without fail.