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Drowning in data (proportionality in e-discovery)

originally published in Lawyers Weekly Magazine

The number of needles a lawyer has to find during discovery has not changed over the years. But thanks to information technology, document haystacks have ballooned out of all proportion. Now judges, litigators and clients want to bring proportionality back to the process.

“The increase in data is huge,” says Kelly Friedman, a partner with Davis LLP. “Ten years ago, you might get 50 boxes of documents in a big case. Today you get thousands of times that.”

“When e-discovery first started making headlines, the story was all about the millions of pages of information that were being collected, processed and reviewed,” says e-discovery consultant Peg Duncan, “the vast majority of which was duplicative and irrelevant, and yielding alarming insights into people’s predilection for porn.”

Compounding the problem, certain factors can make data unnecessarily costly and time-consuming to produce. For instance, a computer forensics expert may be the only person who can recover things like corrupted or encrypted information, deleted data that could be fragmented all over a disc.

Other types of expertise might be called for to get data out of older, unsupported platforms or proprietary formats. “The situation is worse if information is on the Internet, like in Gmail, Hotmail or Yahoo accounts,” says Duncan.

These swelling volumes of largely irrelevant data that businesses keep (often because they’re told to “save everything”) has increased the cost and time needed to produce information to the extent that parties settle cases to avoid discovery costs rather than reach a settlement or try cases on their merits.

An emerging consensus states that proportionality, used along with other Sedona principles, will help solve the discovery cost conundrum. The Sedona Canada Principles Addressing Electronic Discovery affirm that electronically stored information is discoverable and propose a framework for dealing with its production. The Ontario Bar agrees, and (as have other provinces) recently issued new rules of civil procedure in 2010 to promote the use of proportionality.

Reducing costs and improving efficiency during the e-discovery process happens largely thanks to rules 29.1 (parties must develop a written “discovery plan”), 29.2 (parties must consider proportionality concerns in conducting e-discovery) and 30 (parties must limit the scope of discovery to “relevant” documents), according to Cindy Ringer, client relationship manager for legal technology software and services vendor Kroll Ontrack. “The practical intention here is to increase cooperation and planning from the outset of litigation,” she says.

“Proportionality should apply throughout the discovery cycle,” Friedman concurs, “in the preservation of potentially relevant documents, the identification and collection stages, eliminating duplicates, review and production.”

A narrowed test for relevance might not sit well with litigators who “grew up in a world where they had access to everything,” says Susan Nickle, a lawyer with e-discovery law firm Wortzman Nickle Professional Corporation. “Now people are asking what they really need to try a case.”

To answer that question, litigators increasingly need to speak the language of their clients’ document management system administrators and other information technology personnel. Litigators must understand how clients store data in order to use factors like time, expense, prejudice, and availability of alternative sources for information, to defend preservation decisions.

But the first two defences — time and expense — might not hold water for much longer. “‘Undue burden’ arguments, the U.S. analogue to proportionality exclusions, have increasingly fallen out of favour as awareness of e-discovery obligations and technological improvements have made production difficulties increasingly obsolete,” Ringer says.

Indeed, today’s enterprise-worthy document management systems and policies tie in to litigation readiness to the extent that the right document management systems and policies could be considered “preemptive” proportionality. “It’s difficult to engage opposing counsel if you don’t have your own house in order,” Nickle says.

Judges can also reject simplistic “production costs too much” proportionality arguments that litigators do not back up with evidence, partly because today’s e-discovery tools can generate reports that corroborate said arguments. Those reports contain best estimates of time and cost required to produce specific documents, along with other valuable information.

Duncan, Nickle and Friedman, who all share connections to Sedona, agree that changes in procedure are slow in coming (partly due to a paucity of motions to date arguing proportionality). That said, judges and masters are speeding things up by requiring discovery negotiations, forcing parties to do “meet-and-confers” to make them cut down the resulting production.

A subtle linguistic barrier prevents what may be the most valuable proportionality aid: the elimination of non-business data like emails about summer camp registrations and golf trips (and any evidence of porn consumption on the job).

“Rather than creating policies on ‘document retention,’” says Duncan, “businesses need policies on ‘document destruction’ and they must enforce them — and not just for email.”

Eliminating duplicates from systems to further reduce document volumes prompts some companies to move information from tape archives to archiving systems that suppress duplicates while making information easier to search.

“One powerful approach I’d like to see adopted more widely is tagging of documents, so that users can identify documents in a managed repository the way they want, while the records managers can keep control overall,” Duncan says.

Nickle figures the current focus on proportionality in big commercial cases will give way to the needs of smaller, less complex cases. “Every case has electronic records in it,” she says. “Proportionality has a greater impact on smaller cases, where cost is more of a factor.”

Sedona’s view on e-discovery

On October 27, 2010 the Sedona Conference released a public comment draft called “The Sedona Canada Commentary on Proportionality in Electronic Disclosure & Discovery.” You can download a copy for personal by visiting www.thesedonaconference.org.

The commentary:

  • defines the concept of proportionality in Canada
  • provides practical guidance and solutions to discovery disputes
  • includes tables which outline current civil procedure rules across Canada dealing with proportionality
  • lists factors to be considered when applying proportionality principles in Canada at each stage of discovery.

The Sedona Conference seeks peer review from the bench, bar, and others involved in electronic discovery in Canada. Use the public comment form to provide feedback.

Proportionality in a nutshell

In simplified terms, proportionality analysis calls for litigators to meet defined objectives while cutting burdens, costs or delays they don’t need to incur to meet those objectives.

Four factors enter into proportionality testing:

  1. nature of the litigation
  2. relevance of available electronically stored information
  3. whether this information matters to the court
  4. what it costs to produce it

For more information, check out www.thesedonaconference.org

To download a PDF of this article, click ediscovery_proportionality.

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