Discovery vs. Document Review Is Value vs. Cost

Counsel On Call has a Discovery Division while many other companies and law firms have document centers. We also have attorneys working on discovery teams, not document review teams. These might seem like subtle differences, but we are often asked why this is the case.

Many years ago, I met with a CEO of a large document review company that had several document centers. At the time, we really were not doing much of this work despite many requests from clients – it just didn’t seem to fit with our business model. During our discussion about the challenges of the document review business, he stated that he had “X number of seats” and explained to me how he had to get his cost per seat to less than $25.00 per hour. I asked, “By saying ‘seats,’ are you talking about attorneys?” He nodded. I left the conversation thinking, what are we doing here? I understood that it was a business and costs are important, but it was unsettling.

At the time, clients asked us to handle this work because we already had litigation or other types of attorneys working with them, and they appreciated our model: providing talented attorneys a different way to practice law, emphasizing professionalism but eliminating so many of the strings that go along with the traditional practice, and allowing modest rates, experience and competence to drive cost savings. So as I digested the conversation with the CEO, everything became lucid: Why can’t we bring our approach to the discovery process, of which document review is a component? Why can’t we do it differently and better? That commitment built a foundation of success, and our Discovery Division has expanded many times over in recent years.

It comes down to this: If the attorneys understand where documents and data fit within any case, and understand the importance a piece of evidence can have to a deposition, summary judgment motion or even the crux of the case... they provide more than just the cursory review of documents. They provide legal expertise and have the ability to participate in virtually any phase of the discovery process. They exercise judgment and discretion, they review and analyze; they have a solid understanding of any case and how what they are doing fits within the strategy. Our attorneys may not take the depositions but they are in a great position to work with those who are. They aren’t just a seat in a massive room, but a valuable team member working within a well-planned structure that capitalizes on their experience and ability to contribute.

This results in providing value throughout the discovery process, not just for one component or a heightened focus on lowering a “per seat” cost. As we’ve stated before in this space, the hourly rate of the attorneys is important in achieving cost savings, but issues such as experience, leadership, technological flexibility and execution are equally important when looking at value and savings over the life of an assignment. So when we combine the talent and cost practicality of our attorneys with processes that are continually being improved and evaluated, a thorough understanding of technology and the various options that exist, a focus on lowering costs by dramatically reducing data and gaining efficiencies, working across multiple stages, maximizing resources on a repeatable basis and treating attorneys with professionalism, it equates to a better, consistent, less expensive and value-driven work product.

I would love to travel back and ask that CEO about costs over the life of an assignment, the flexibility to choose software that’s right for a particular data set, implementing review efficiencies, quality control protocols, best practices and early case assessment initiatives. I would ask him if their attorneys choose to practice with his company, whether they communicate with outside counsel about case strategy, depositions, motions and other aspects of the discovery process. Whether thought is put into the environment and teams in which people work together. I would ask how they do a better job for their clients on the next assignment, about the metrics they use to track results and about the other litigation phases on which they assist.

All of these issues differentiate discovery from document review, and all of these issues speak to value versus cost.
 

E-Discovery Tools: Evaluate, Collaborate and 'Lawyer the Problem'

It’s hard to believe that after all the planning from Discovery Symposium 2.0 that it’s over. It was a very fast-paced, informative and fun two days. But now it’s time to recap – if it’s possible to capture in a blog post the back-and-forth dialogue from panelists to audience -- and figure out what we learned… and where better to start that the first session of the first day?

On the ‘Software Experience, Culling and Early Case Assessment’ panel, I had the pleasure of sitting on stage with Edward Efkeman from FedEx and the director of our E-Discovery Division, Richard Stout. Edward has co-chaired FedEx’s internal e-discovery initiatives for the last three years, and if you’ve been to a major e-discovery event, you’ve likely seen his name on the program. Edward and his FedEx colleagues have a great discovery model in place.

We had a lively discussion with a lot of interaction with and questions from the audience. The most important takeaway for me was a comment from Edward: “Don’t forget to lawyer the problem.” FedEx definitely walks the walk in this regard and their in-house team is incredibly hands-on and detailed-oriented. His point: it’s not enough to throw technology at a matter or process; it must make sense and it must still meet the legal standards of reasonableness, defensibility and good faith. This is wonderful advice that I believe gets lost in the noise of the thousands of technology tools, webinars, conferences and white papers that engulf us.

In the spirit of ‘lawyering’ the problem, we were also reminded that lawyers have been doing early case assessment (ECA) from the beginning of the profession… it’s just now they must use technology to help solve a technology problem, which is volume. One still must interview custodians, decide what’s in and what’s out, strategize, etc. Using technology to solve a technology problem is really the only thing that has changed, and when utilized properly certainly makes life easier. (There is also a good post on E-Discovery 2.0 surrounding the discussion of the interviewing process.)

So your software selection must be understood and used by your lawyers. It’s not good enough that IT is impressed with the technology; the lawyers are the ones who must understand how it works. And bringing the process in-house is not the only option that a corporation may consider, obviously. They can also partner with an outside vendor to help guide and staff the process, review and ultimately produce what needs to be produced.

Along with risk tolerance, these decisions also come down to cost and results. Cost savings are found in reducing the amount of data and then reviewing the remaining data faster. Content analytic tools, clustering, and improved search functionality have aided review teams to speed the process and thus save money. Good tools and consistent protocols also provide more reliable cost predictability, which has generally been lacking in the discovery world in most cases. Using experienced attorneys who understand how to use the full capabilities of a review tool helps with speed, accuracy and overall project cost.

Relationships – internally and with outside counsel, IT vendors and other service providers – are also keys to success in the discovery arena. Everyone must understand roles, collaborate and communicate, and problem-solve. These were consistent themes throughout DS2.0, actually, and success with the above factors leads to results that are difficult to top, the panel agreed.

We also discussed several specific tools and platforms. ECA platforms such as Clearwell, Lateral Data and Equivio, among others, were detailed; the number of companies that have started to use one ECA platform or another has risen dramatically in the past year; reducing up to 90% of the data to review will clearly open some eyes. Some have even tried various purported “all in one” tools, though the general consensus was that no one tool excelled in all areas of the EDRM. The majority of companies that have the resources to pull chunks of the EDRM in-house don’t seem overly concerned with the “all in one” solution – they want the right tool for the specific case or matter, or have identified particular tools that fit the majority of their work (or at least ECA and the review). Others find the idea of off-site hosting/processing very appealing, and along these lines the panel and audience discussed platforms and services that offer “seamless” use of multiple tools, but with no real consensus. Regardless of the path, it's always wise to "test drive" a tool or platform before making any decisions.

Another takeaway worth noting: since it’s the lawyers who must be able to use the tool, a vendor may have already lost the sale if its software requires a full day (or even a multi-day) training session to fully utilize and comprehend it. That time commitment just isn’t realistic in today’s environment, and it certainly doesn’t affirm the “ease of use” mentality that so many in-house counsel seek. Understandable, practical and cost-effective are what matter. Without those, the in-house lawyer will not even give a tool or platform a second look.

We’ll have more on our other sessions in the coming days.
 

Energetic Group for Discovery Symposium 2.0

In May 2009, we hosted our inaugural Discovery Symposium, a Counsel On Call client event for a small group of heads of litigation, general counsel and e-discovery managers. We thought that by keeping the group small it would increase the likelihood of candid dialogue about what our clients are experiencing on a day to day basis, where they are struggling, and hopefully result in some real information sharing and best practices… and to help our E-Discovery Division improve and better meet their needs.

The feedback we received from the 35 in-house attorneys who attended the event indicated we achieved these goals, and several attendees made us promise that we’d organize the event again in 2010. So not only are we hosting it again (May 12-13), we’re stepping it up a notch with what we believe is even better programming that is more tailored to the diverse e-discovery knowledge levels of our attendees.

Best practices surrounding early case assessment and technology platforms will be a significant part of the program, as will process management, collaboration, budgeting and outside counsel relationships. We’ve also developed breakout sessions for those attendees without “robust” IT departments and for those highly knowledgeable about the litigation hold and ESI policy processes, among other topics. Panelists are from companies such as AT&T Mobility, AutoZone, Cox Communications, FedEx, Fidelity Investments, HCA, International Paper, Partners Healthcare, and SunTrust Banks, among others.

The response to the DS2.0 program has been tremendous, so much so that we’ve had to cap the registrations at 55 attendees from 40 legal departments across the country. It's a diverse group of Fortune 25 corporations, mid-size companies and smaller departments and we’re really looking forward to the event.

We’re also excited to once again “live blog” from the event, so please check in next week for recaps from each session. For more timely updates, you can also follow Chad Schmidt on Twitter (others to follow are listed on the menu to the right).

If there are any questions you'd like us to pose to our distinguished panelists, we'd love to hear from you... please just post in the comments.

Early Case Assessment Provides Bang For Your Buck

It’s been nine months since my Review less data, and review it faster post -- a lifetime in the e-discovery universe -- so I thought it time to brush off the dust and revisit the post's underlying principles.

First, let me note that I think in-house decision-makers have become more informed consumers of all things e-discovery since that post (and others) was written. More people understand the basic concepts around reducing legal costs and more people know the right questions to ask. So while I agree with much of what what was written on the '3 Geeks' blog regarding the question “if clients are smarter now,” I believe that the overall knowledge level within the in-house community has increased.

That being said, I have been involved in several discussions with potential clients recently and when I ask questions on how they currently handle the e-discovery portions of their cases, it has often been apparent that a key component to reducing costs has been overlooked (or at least has not been the focus of cost-reduction efforts). It is still common to hear of strategies focused on the hourly rate of the attorney reviewer. While the cost savings from a law firm attorney to contract attorney are certainly substantial and save big dollars, the cost savings of a contract attorney versus another contract attorney is not significant in the overall cost of litigation. In fact, it is not uncommon to see the lowest-cost provider produce a result that’s higher in total costs due to the layers of review required to ensure a consistent work product.

A real opportunity to save major dollars in e-discovery is through an effective early case assessment (ECA) strategy. This requires implementing a repeatable and defensible process that is targeted toward finding relevant information and safely eliminating non-relevant information. Through advanced ECA technologies, one can filter out clearly non-relevant email domains from a review, limit the universe of reviewable documents by date parameters, and most importantly apply AND TEST well-crafted key term searches to the collected data. The importance of comprehensive and effective key term searches cannot be overstated. Done correctly, it can consistently reduce the amount of data to review by 85% or more.

Well-crafted key term searches are not a one-time task. Rather, effective (and defensible) key term development requires application of key terms, sampling of the results of those key terms, and expansion and narrowing of the search terms. It is critical to properly document every step of this process so that you can demonstrate the good faith efforts in targeting relevant information and eliminating clearly non-relevant information.

A little bit of Early Case Assessment can go a long way. This became apparent in one of our year-end reviews with a client in which we compared 2009 to 2008 numbers. It did not surprise me at all that we handled twice as much data for the client in 2009 versus 2008. The client simply had more litigation in 2009. What popped off the page was that despite this significant bump in volume, we reduced costs by almost 60%. That’s mainly because we implemented an early case assessment protocol for all the client’s matters, which not only reduced the number of hours our attorneys spent reviewing documents, but sliced the client’s overall technology/review software expenses as well, saving millions of dollars over previous years’ expenditures.

So while application of key terms prior to review may not always be possible in a matter, the principles of early case assessment are. Spending a few hours on the data prior to batching for review can ultimately save significant dollars. There are several great ECA tools on the market – including a couple of new ones we’re experimenting with – and the costs are comparatively small. And if you’re looking for some bang for your buck, ECA is a great place to start.

Speaking of ECA, our friends at Clearwell posted an entertaining video today (it’s April 1, lest we forget).
 

E-Discovery is Trust and Commitment

There’s a very good post on Clearwell’s e-discovery 2.0 blog about the process of bringing e-discovery in-house, or more importantly some of the questions that need to be asked during that process.

One particular observation in the post stuck out to me: “…every company today, believe it or not, has an e-discovery solution in place.” This is very true. Many companies who must scramble or shift work around internally to address a pressing matter or who automatically send any and all litigation straight to outside counsel might not characterize their approach as a “solution” (more of a default mechanism, maybe), but it is a solution, nonetheless. From that point forward, the steps and questions laid out in the post are certainly good ways to look at the in-house e-discovery process.

The statement also juxtaposes another observation in the post about in-house departments going through the RFP process and seeking an “end-to-end” e-discovery solution. These two statements, in my view, are actually directly related. Many in-house departments are not equipped to handle any significant e-discovery work, so in the past they simply sent that work to their law firm(s) because they could physically handle the review of the documents (and were already handling case strategy). Now that the in-house departments are under incredible pressure to cut costs, they must come up with a different solution, but still don’t have the resources or time to handle it internally. They want a simple, straightforward solution that they can hand off and know it will be handled in a quality, cost-sensitive manner.

I believe this encapsulates one of the most challenging issues we face in the e-discovery realm today, one that our company has spent an inordinate amount of time addressing internally and that

ultimately helped us create the “end-to-end” solution that we offer. The issue is that there is no one-size fits all in the world of e-discovery. Every case is different. Sometimes a different review tool is needed; sometimes it makes perfect sense to use an early case assessment tool, sometimes it doesn’t; sometimes it’s better to bill by the hour instead of billing by the document, gigabyte or custodian. For us, the ability to offer flexibility was central in our end-to-end service – we’re not tied to one review tool or processing partner, we’re not tied to one type of pricing, we’re not forced to use anything because of previous business purchases, mergers or partnerships.

When simplicity and a straightforward approach are paramount, it boils down to two basic questions: 1) Is the in-house department truly ready to step away from the old way of doing things? and 2) Is the department ready to tell everyone involved, “This is how we’re doing things now?” Simply put, it is trust in the process and commitment to it.

If there’s anything that can be learned by those clients initiating the RFP process, it’s that there is an entire industry of e-discovery providers that eat, sleep and breathe these matters and share a focus on initiatives like protocol, effectiveness, cost reduction, knowledge retention, defensibility, litigation ROI, and dozens of other business-focused issues. In fact, many law firms rely on companies like ours to provide these services and focus to their clients. Only a little bit of due diligence on this front should ease any trust concerns an in-house department might have.

Then comes the issue of commitment, and we see this challenge every single day. In-house leaders are often in terrible predicaments when it comes to making changes in the e-discovery process, especially when they have become so accustomed to particular arrangements. But what we’ve seen time and again is that when in-house counsel sets the tone, works with its partners (including their law firms) to create a solution and a new e-discovery process is implemented, the results trump everything. At the end of the day, the ability to point to a better, more consistent process and to quantify cost savings and value are worth their weight in gold.

So while building an e-discovery process might seem like an arduous task, it really isn’t. It comes down to trust in your partners and commitment to your process, and the payoff on those fronts is significant.

 

Cost Predictions Rely Equally on Technology and People

I’m a little late on this one, but this article outlines the use of technology to budget and control the cost of a document review project and could be helpful to some folks. It's sometimes an overwhelming topic, but there's no question that law-related technology tools have advanced in recent years and, when used properly, can drastically reduce the overall data set that is needed to review, code and produce. De-duplication, near dupes, key words, clustering of some type or another and document-ranking technology all can be very effective steps to take. In fact, if you are not using the available technology to reduce the data set needing to be reviewed, it’s practically scandalous.

I've seen more than a few very professional, normally sane in-house counsel practically lose their lunch when they hear about the initial amount of data that must be reviewed on a case. When the word "terabyte" is uttered, or there are three digits in front of "gigabyte," it can be somewhat alarming... that cash register sound starts to go off inside your head. But once everyone has calmed down, reason sets in and the processing stage begins. A majority of that data is going to be culled out. If using an early case assessment (ECA) tool, another huge chunk of data will be eliminated. All told, as much as 95% of the data could be vanquished. Now we have an amount of data we can work with. It can certainly be budgeted, too -- and if the review partner knows what it’s doing, it can be very accurate and for even less money than anticipated.

So technology by itself is not the final answer. Technology combined with knowledge and experience are the keys to understanding the complexities of such projects and bringing back a semblance of simplicity and predictability. Yes technology, used skillfully, can reduce the overall data set and the volume that needs budgeting. But when coupled with skilled, professional reviewers and experienced project management – known quantities that understand the entire collection, processing and review stages, software, and how to measure results and benchmark data – you can better prepare a cost forecast that can be relied upon for the duration of the project and on subsequent matters. I feel confident in stating that any in-house attorney who has worked with a good project manager in particular will gladly share how invaluable that PM has been to his or her department.

So if you aren’t using 1) e-discovery specialist project managers and attorneys and 2) data reduction and/or ECA tools, there are significant savings to be had.

Additionally, in the normal course of business you can also reduce the overall cost of a review project by creating and following a record retention policy, as well as using project management consulting to help with other pre-litigation planning. These measures reduce the overall data set, help you understand where your data is located, and give more certainty and predictability in later creating the review budget.

Data is key in today’s world; technology has made it readily available, but you also need a cohesive approach to tap all of its benefits. It might sound like a tall hill to climb, but there are some very simple steps that can be taken to start the process without causing too much pain. In the end, the cost savings and improved processes that are gained will make all that work worthwhile.
 

Is That Thunder In The Distance?

There’s an interesting phenomenon happening in the litigation arena right now: nothing.

Well, that’s not entirely true. There is plenty going on, of course, but the sour economy has put a different spin on how litigation is being managed. Cases are not marching in lock-step with a normal timeline. For instance, some companies are putting everything related to a piece of litigation on hold until they are required by time, or the case itself, to act. And action this time around is preceded (in most instances) by a lot of anxious planning and budgeting.

Now this isn’t anything new – many companies have longstanding policies not to act on litigation until forced to do so. It’s often a cash-flow-versus-workflow approach. However, I am seeing a palpable sense of hesitancy with regard to litigation and case management. Companies are taking an ‘I’ll believe it when I see it’ stance, whether it’s regarding the various stimulus measures and burgeoning economic turnaround, or the stability of a company and their department's budget, or any number of other things. That attitude is impacting case management. These companies know that eventually they are going to have more work (i.e. revenue), but they simply do not want to spend the money now, when times are tight, addressing litigation matters unless they have to.

All is not dour under this approach. One great side effect is that companies are taking this time to create, refine or institute their approach to e-discovery for when the storm finally does come. If their ducks aren’t already in a row, they are briskly walking toward the line.

We’ve participated in dozens of planning or strategy meetings that are seeking to solve the bigger issues: how to create repeatable discovery processes, how to budget discovery costs, the software tools to use, the action items surrounding a litigation hold, the data collection and management process, analyzing the benefits of early case assessment tools, and creating processes that facilitate collaboration with outside counsel and all their legal vendors, among many, many other issues.

All of this is ultimately focused on cost and efficiency, of course. And it’s never too early to make that a priority – or in some cases, it’s not too late.
 

Podcast: What Works In E-Discovery, Cost Savings

The second podcast with LegalTalk Network's In-House Legal show is now up.

Richard Stout, director of our Litigation Support Division, and Dennis McKinnie, executive director of our Atlanta office, discuss all things e-discovery: Why the review rate is important, early case assessment tools, what e-discovery savings should really look like, the importance of outside counsel, and why every in-house department should have a discovery process it controls, among other things.

The 13-minute interview begins around the 13:45 mark. The podcast is also available on iTunes for free download.

We hope you'll check it out and let us know what you think.

The LegalTech Jungle

It’s hard to believe that the annual Legal Tech conference is just around the corner, Feb. 2-4 in New York. Hundreds of vendors and thousands of attendees will descend upon the Hilton New York Hotel in what has become a must-attend event for those of us on the technology side of the profession.

If you’ve been to LegalTech, you know it can be a little overwhelming and it’s important to go in with a plan. While sorting through the masses, we have several distinct objectives while we're there:

  1. Review the latest technology tools that can reduce the time and expense of litigation in a number of areas. We are particularly interested in technology that can reduce the amount of data to process and review (see: early case assessment tools)
     
  2. Learn from legal and corporate counsel the challenges they face and the measures they have taken to address . Panels of interest include: "Executing eDiscovery Inside the Corporation," "Corporate Legal Department vs. Law Firm Perspectives," "Managing eDiscovery in an Alternative Fee Envrionment," and "State of the Art in eDiscovery Automation and Early Case Assessment"
     
  3. Meet with technology providers and share what we’ve learned about their services and discuss ways we can work more efficiently together

All of this will help us better serve our clients now and in the future. eDiscovery can be a jungle, and LegalTech aids our efforts to be the best safari guides we can be. In a couple of weeks I will post a post-conference summary with information you’ll hopefully find helpful.

Until then … wish us luck.