e-discovery 2.0

There has been no shortage of articles in the e-discovery blogosphere about the Qualcomm case (heck, we’ll even own up to jumping on the bandwagon and writing a couple ourselves). However, if in the rush of events leading up to LegalTech you haven’t had a chance to read the details of U.S. Magistrate Judge Barbara Major’s recent sanction order, it’s worth taking a few minutes to read through it (or, for an excellent overall summary, see this article on law.com).

The most striking aspect of the judgment, which is completely overlooked by many vendor articles seeking to spin it to their advantage, is the fact that this case wasn’t about a failure of e-discovery technology. It wasn’t about the attorneys not thinking enough about the best keyword strategy, or not understanding the need for conceptual search to ferret out additional responsive documents. Rather, at a key point in the trial, 21 highly relevant emails were discovered, but according to the order, “the Qualcomm trial team decided not to produce these newly discovered emails to Broadcom, claiming they were not responsive to Broadcom’s discovery requests.” Judge Major goes on: “The attorneys ignored the fact that the presence of the emails…undercut Qualcomm’s premier argument…The Qualcomm trial team failed to conduct any investigation to determine whether there were more emails that also had not been produced.”

Assuming that all of the facts are before us, this was not a computer algorithm problem. It was a human judgment problem.

Don’t get me wrong. Leveraging the right e-discovery technology is important, but not in the way that many vendors would have you believe. Search and analysis is becoming table stakes. What’s needed today are solutions that provide a system of “checks and balances” to track and monitor documents throughout the discovery process, making it harder for documents to be overlooked or ignored in the way that they seem to have been by the Qualcomm team – while enabling enterprises to have more ownership over all aspects of e-discovery.

Such technology will be the enabler, but in the end, it will be people – very likely in the form of an e-Discovery Team – that will save you from Qualcomm’s fate.

In my experience, e-discovery does not make the radar screen of most corporate General Counsels (GCs). Typically, it is one many issues left to others (e.g., Chief of Litigation, Director of Litigation Support) within the GC’s group. That may change after the recent verdict in the case of Broadcom vs. Qualcomm.

See below for the story, as told by Corporate Counsel in their October issue, with additional commentary from me [added in brackets]:

Collateral Damage

After a string of punishing legal defeats, Qualcomm Incorporated has switched general counsel. On August 13 the company announced that Carol Lam would replace Louis Lupin as its legal chief [Sounds like he got fired]. The move came a week after a federal judge issued a scorching order accusing Qualcomm and its outside lawyers of “gross litigation misconduct.” [Sounds like a pretty good reason why he got fired]

Emily Kilpatrick, Qualcomm’s director of corporate communications, says Lupin is leaving for personal reasons [Isn’t that what they always say?]. “He has been an outstanding leader and contributor to Qualcomm’s success over the past 12 years,” according to Kilpatrick. “However, he has decided to step down as general counsel and take a personal leave.” [a decision most likely made at the request of his boss]

Lam, who was hired in February to supervise Qualcomm’s worldwide litigation, will take over as interim GC, according to a company statement. Lam is one of the U.S. Attorneys fired by the U.S. Department of Justice this past winter. [oh, the irony…]

Based in San Diego, Qualcomm licenses semiconductor technology and system software to cell phone makers. For several years it’s been engaged in a pitched battle with rival Broadcom Corporation over who has infringed whose patents.

Qualcomm’s biggest problems have come in a case in San Diego federal district court. In January a jury ruled that the company had violated Broadcom’s patents. But even before the verdict, Qualcomm suffered a major setback as the trial drew to a close. One of the company’s witnesses revealed the existence of email that Broadcom said should have been produced during discovery. [Yet again, email is the smoking gun]

In April general counsel Lupin and one of Qualcomm’s outside attorneys sent letters of apology to the court, saying they failed to do a detailed enough keyword search of the company’s email. [No big deal, right? After all, we are saying sorry]

But that wasn’t enough for Judge Rudi Brewster, who has been hearing the San Diego case. On August 6 he issued a blistering 54-page ruling. He accused Qualcomm not only of failing to turn over more than 200,000 pages of relevant email and electronic documents during discovery, [i.e., this is a case of a deeply flawed e-discovery process, not of a simple missing email] but of engaging in a years-long campaign to deliberately mislead a technological standards body. Brewster ordered Qualcomm to pay Broadcomm’s litigation costs, and voided two of its patents. (David Rosmann, vice president of intellectual property litigation at Broadcom, estimates that its fees could be around $10 million). [The legal costs alone are several times what it would have cost Qualcomm to purchase an e-discovery solution and avoid this whole situation in the first place]

In a statement, Qualcomm said it “respectfully disagrees” with Brewster’s ruling and intends to appeal. “Qualcomm acknowledges the seriousness of the court’s findings and reiterates its previous apology to the court for the errors made during discovery and for the inaccurate testimony of certain of its witnesses,” the statement read. [We said sorry, isn’t that enough for you guys?]

The company’s problems aren’t over, however. Federal magistrate judge Barbara Major is now considering whether to levy sanctions against Qualcomm’s attorneys. [Don’t think you can hide behind your deep-pocketed employer. If you screw up e-discovery, it will be your neck on the line] Major has given “any and all…attorneys who signed discovery responses, signed pleadings and pretrial motions, and/or appeared at trial on behalf of Qualcomm” until September 21 to file a statement explaining why they shouldn’t be penalized. [For the lawyers in question, it’s guilty unless their arguments convince the judge they are innocent]

This is the first of several guest posts from Kurt Leafstrand, formerly a rocket scientist at MIT and now an e-discovery guru at Clearwell. Kurt was on vacation last week, but couldn’t resist spending part of it at an important gathering in Florida. His report:

Last week, 3,000 of the country’s top legal technologists gathered in Orlando for the 2007 International Legal Technology Association (ILTA) conference. Lawyers will always be lawyers, so the hotel staff seemed particularly diligent as they secured the electrical cords to the floor of the exhibit hall, and the Starbucks seemed a bit on the cool side. However, the discussions and technology were far from cold, and the show was a great chance to learn from some of the industry’s leading practitioners from both corporations and law firms.

E-discovery was the focus of many of the conversations, and several emerging trends were at the forefront:

Courts are taking a more active role in e-discovery: With the changes to rule 26(f) in the FRCP, parties are required to confer early (and agree on!) e-discovery. This has pushed the courts to start issuing guidelines to help remove some of the ambiguity from this process and to help parties reach a faster consensus. In one session, Browning Marean of DLA Piper highlighted as “best thinking” a protocol from the Maryland District Court, which included:

• Defining minimum standards for the kind of information to be exchanged
• Recommending that each party have an ESI coordinator (this may lead to IT/legal tech being brought into the meet and confer process)
• Setting defaults to be applied if parties can’t agree

One panelist pointed out that, in spite of all this, “the average litigator is woefully unprepared for the e-discovery aspects of the rule 26(f) conference.” With the courts showing early aggressiveness in ensuring that the FRCP changes are actually put into practice, it appears that the already intensive focus on ESI will only increase, so firms and corporations need to get their acts together quickly.

Discovery battles are taking center stage: In what many see as a worrisome trend, e-discovery battles are increasingly common and focus “not on the case and its merits, but on spoliation and sanctions.” Because of the error-prone nature of most e-discovery efforts, it often pays to look for “little slips… did some executive accidentally delete his email? Was there a failure to produce?” One astute participant commented that the “interest in sanctions is because electronic data is so treacherous. It’s much easier to get it wrong than right.”

Two current e-discovery “train wrecks” serve to highlight this:

• Intel/AMD: Despite elaborate and costly efforts to comply with preservation orders across 100,000 employees dispersed around the world, Intel found itself having to advise the court of “document retention lapses that have occurred…after the filing of complaint.“
• Qualcomm/Broadcom: The attorneys who represented Qualcomm in its unsuccessful patent lawsuit against Broadcom found themselves summoned before the court to show cause as to why sanctions shouldn’t be imposed for their failure to produce documents pertinent to the case: approximately 230,000 pages of documents, actually.

How do corporations and firms better manage their risk in light of these trends? One panel of senior partners suggested that parties need to work smarter, not harder, when it comes to e-discovery, and understand that the state of the art is moving toward a highly iterative e-discovery process. In most initial e-discovery requests today, “the signal-to-noise ratio is such that search results are often meaningless.”

This new approach will need to be “negotiated throughout the e-discovery process,” but is going to becoming increasingly critical for both sides of the case to work together on in order to assure that they don’t find themselves in the same (costly) boat as Intel and Qualcomm. This trend was especially relevant to ILTA attendees, because the only way to make this iterative process work is through their active participation, assisted by the next generation of e-discovery 2.0 technologies.