Guide us in Electronic Discovery, O Guidance
Monday, March 23rd, 2009
It’s been a little over a month since the news first broke that Guidance Software was the frog in an electronic discovery kettle whose water had just reached the boiling point, with the arbitrator in an employment case demanding, “I want this game-playing stopped.” We thought that, with a little time between the initial story and now, it would be worth taking a step back and looking at possible lessons learned — not so much for Guidance specifically, but for enterprises who find themselves in similar situations, as well as the electronic discovery community that serves them.
First, a quick summary. Based on published accounts, it seems like a classic discovery situation (that’s just plain old discovery, without the “e”): a party is sued and fails to produce a document that, lo and behold, surfaces via some other source, throwing the integrity of the sued party into question. After all, if one potentially incriminating document wasn’t discovered, then who knows what else could be out there?
Guidance contended that it did everything that was required of it, and that it didn’t have (or couldn’t find, despite good faith efforts) the emails in question. But, of course, that didn’t stop the litigation support community (via forums such as the Litigation Support List) from pouncing on the perceived hypocrisy.
After all, how could a leading, publically-traded electronic discovery company get caught up in such a mess? How could their cutting-edge electronic discovery technology not have saved them? Or their (hopefully) best-in-class internal electronic discovery processes? If the electronic discovery companies don’t have their acts together, what about all the other poor souls who lack their knowledge and expertise?
That last question is a scary one, particularly given today’s environment, and it’s why the situation has stirred up so much chatter out in the electronic discovery blogosphere. Almost without exception, commenters have jumped to one of two conclusions. Either (a) Guidance has not followed proper e-discovery best practices, or (b) Guidance has willfully chosen to hide relevant documents that it could have produced, because they would be detrimental to its case.
Let’s explore each of those conclusions in a little more detail.
First, is there any direct evidence that Guidance did not follow electronic discovery best practices? The answer there is murky. Certainly, from Guidance’s perspective, the answer is a resounding “no”. They continue to claim that the emails that were produced from another source did not exist on the various laptops, desktops, and servers that were part of the initial discovery request, and it is certainly possible that that is true. Perhaps Guidance had a 1-year retention policy for emails, and the emails in question were outside of that policy. Perhaps the individuals involved had legitimately deleted the emails in question prior to receiving a litigation hold notice, without thinking that they would ever be relevant to a legal matter. Certainly an independent observer has grounds for incredulity here, but it does not necessarily follow that Guidance did not follow electronic discovery best practices for a company of their size and resources. Certainly, from the reports, they did not exactly act in a way that earned much confidence from or favor with the arbitrator. However, that’s a completely different issue, and one which may be a legitimate tactical decision by Guidance (to avoid, for example, the high cost of recovering the corrupt backup tapes).
Second, what if Guidance willfully chose to hide relevant documents? At this point, there is no evidence that this is the case. And, you would think that of all of the companies out there, Guidance would be keenly aware of the extremely high level of risk associated with this strategy. A company well-versed in computer forensics understands keenly that the odds of any potentially negative emails not being out there, somewhere, in cyberspace are incredibly small. Thus there is little incentive to intentionally hide documents. If, however, a company did make such a perilous and unethical decision, it has nothing to do with a lack of e-discovery best practices or technology: it simply has to do with a lack of ethics.
So, has the coverage of the Guidance situation been nothing more than an electronic discovery witch hunt? Far from it… even if both of the “conventional wisdom” conclusions are in fact wrong.
Why? Because even if Guidance has its electronic discovery house in order and is acting with complete integrity, if there’s one thing that anyone in the electronic discovery business should have taken away from the last 5 years of court rulings, it’s that perception and transparency in electronic discovery is everything. Electronic discovery is technically complex and fraught with challenges, and companies – particularly those who are perceived as having vast expertise in the space, whether as vendors (i.e. Guidance) or institutions (i.e. pick your favorite TARP recipient) – have to act in such a way as to appear spotless before the court of law and the court of public opinion.
Assuming you already have your electronic discovery house in relative order (a baseline, fundamental requirement for doing business today), perhaps the most important take-away from Guidance is how carefully you need to consider how minor electronic discovery slip-ups, whether real or perceived, can bite, big time. The legal and media environment is primed to pounce on any hint of a cover-up or conspiracy, and enterprises must go the extra mile (or two, or three…) to ensure that their e-discovery efforts are, and will be perceived, as upright, ethical, and above reproach – or be ready and willing to pay the price in sanctions or loss of public confidence.


