Ethical Considerations in E-Discovery

By John Meagher, Senior Case Consultant, TLS

In my experience, both as an attorney and as a consultant, initial conversations surrounding e-discovery often involve the efficiency of methods as they relate solely to cost. That is understandable. Discovery costs can be a significant factor in the decision to bring or defend a law suit. However, there is an equally important factor to consider: your ethical duty to your client and the Court. Ethical considerations are present in all phases of e-discovery. This article focuses on two areas: preservation of data and technology assisted review.

Preservation

At the outset of a matter, many clients are concerned with the costs and logistics of performing a comprehensive forensic collection. Two common ways that clients seek to cut costs are: 1) opting not to preserve all relevant records and 2) using in-house resources to collect and assess relevance.

As to the first issue, Courts are nearly unanimous in recognizing the obligation to advise clients to preserve relevant data:

  • Telecom Int’l Am., Ltd. v. AT&T Corp – “Once on notice, the obligation to preserve evidence runs first to counsel, who then has a duty to advise and explain to the client its obligations to retain pertinent documents that may be relevant to the litigation.”
  • Vagenos v. LDG Fin. Servs – Noting counsel’s “heightened responsibility” to advise and explain to client the continuing obligation to retain potentially relevant documents.

Given this fact, it is prudent for counsel to advise that, at a minimum, all relevant data should be preserved—no matter where it is stored. Failure to do so can lead to harsh consequences:

  • Medcorp, Inc. v. Pinpoint Techs. – Sanctioning plaintiff with nearly $90,000 and jury instruction after finding that it negligently allowed spoliation of hard drives.
  • United States v. Suarez – Sanctioning government with jury instruction following spoliation of text messages.

Courts are increasingly skeptical that a party’s employees can effectively discern what is relevant in implementing a legal hold or collection. Recent decisions have harshly criticized self-preservation for various reasons, including calling into question the employees’ qualifications or impartiality.

  • Jones v. Bremen High Sch. Dist. 228 – “As a non-lawyer and as an interested party, Jurgens is not qualified to judge whether documents are relevant to the suit.”
  • Orbit One Commc’ns, Inc. v. Numerex Corp. – Finding failure to preserve where the primary responsibility for safeguarding information remained with “the very individual with the greatest incentive to destroy evidence harmful to Orbit One and to his own interests.”

By engaging a reliable service provider to conduct a targeted, defensible forensic collection, client and counsel can moot these accusations while keeping costs within reason.

Technology Assisted Review

Courts are becoming increasingly interested in the methods used in e-discovery, both to determine if “best practices” are utilized and in determining what costs are taxable:

  • Disability Rights Council of Greater Wash. v. Wash. Metro. Transit Auth. – Suggesting that concept searching is more efficient than simple key word searching
  • United States ex rel. Becker v. Tools & Metals, Inc. – Court substantially reduced award of discovery costs for inter alia the inefficiency of reprocessing data and charging for “excessive” seat licenses.

If, as in Becker, a Court is going to get so deep into the weeds as to disallow otherwise reasonable charges because in-house counsel didn’t use his seat license to access the review platform, it is not unlikely that we will see challenges for failure to use advanced processing/early case assessment platforms such as Digital Reef – with its Predictive Priority capability and Technology Assisted Review (“TAR”) analytics (near duplication, e-mail threading, concept searching, and predictive coding) – to reduce attorney review costs.

While every case is different, recent studies have shown that using TAR can result in dramatic savings. According to the eDiscovery Institute Survey on Predictive Coding from Oct. 2010, survey respondents reported cost savings of 36% on average from use of email threading and 45% on average when predictive coding is used—although individual results varied greatly.

As e-discovery technology continues to evolve, it is imperative that corporate counsel, outside counsel, and service providers be mindful not only of the cost savings but also of the ethical considerations of efficiency. The trend is clear that as courts become more accustomed to technology, they will hold counsel and litigants to ever increasing standards.

John Meagher, Senior Case Consultant, is based in TransPerfect Legal Solutions’ Chicago office. He can be reached at +1 312.578.0887 or jmeagher@transperfect.com.