The rules of discovery are changing. Remember Y2K? Many legal professionals, and many organizations providing outsourced services to legal professionals, would have you believe that the “sky is falling" - again! The amendments to the Federal Rules of Civil Procedure (FRCP) go into effect on December 1, 2006 - only weeks away. Are you and your firm prepared? Additionally, a law firm’s fiduciary relationship with their clients presumes that the firm will provide appropriate guidance relative to the new amendments and their impact upon current and future matters. Therefore, the question must be raised – are your clients prepared? Finally, before you get too comfortable and smug if you feel you, your firm and/or your clients are prepared, have you factored in how the lines between Litigation, Compliance, Records Management, Security and Intellectual Property solutions are now blurred. This month’s newsletter will focus on the challenges that the FRCP and our new digital world have precipitated - providing food for thought as to your firm's/department's readiness to navigate these new waters and be successful in your role as proactive risk managers and advisors for your clients and/or your organization.
In the decade from 1986 to 1996, over four hundred document scanning, capture and indexing applications evolved. Essentially, electronic filing cabinet and document distribution solutions, they were supposed to herald the new paperless society. Not exactly - our printed document page count doubled in that period thanks the exponential increase of the number of computer users and printers and quantum leap in printing technology. The off-site document storage and retrieval industry thrived and the application-produced document files residing on workstations and servers were captured primarily for backup and restore purposes only. Litigation and regulatory related document production processes were limited to printing, scanning and copying coupled with a handful of file “viewers” which provided leading/bleeding edge functions for culling and reviewing the documents.
In our most recent decade from 1996 to 2006, the need for paper remains at a high level, but that is a “false positive” because of even more computer users and the cost per printed page going through the floor. Today’s printed documents are, for the most part, either a convenience or ritual for a limited number of users or case-specific mandated copies or blowbacks. The new amendments to the FRCP confirm that paper is close to going the way of the 80-column punched card (smile, if you even remember what that was). Two key factors have brought us to this realization: 1) We are generating too many documents on a daily basis to mandate paper as the default form of a document; and 2) More than ninety-five percent of the applications generating documents, thanks to Microsoft, are standardized. With e-documents, e-data, e-mail and e-discovery – the digital world of electronic Enterprise Content Management (ECM) and associated e-records management has arrived and there is no choice but to embrace it. The number of companies who are enduring the consequences of poor records management is growing daily.
ECM application providers have experienced significant consolidation in the current decade. The remaining players, focused on the “Global 2000” market, include OpenText, EMC, Hummingbird, Interwoven, FileNET and Stellent. This market has the deepest pockets, the largest volumes of content and the greatest instance of regulatory control. If you are the outside counsel for, or the General Counsel of, any of the Global 2000 a major component of corporate risk management is in place. However, mid- tier companies without an ECM platform in place and an e-records management policy defined and executed are tempting fate. The next article will explain why.
Organizations large and small, including law firms, need to view their enterprise digitized content; documents, emails, text messages, spreadsheets, PowerPoint presentations, drawings, photographs, recordings, videotape, brochures, etc., as manageable assets. Assets controlled by a carefully developed e-records management policy that should, at a minimum, include data storage guidelines including classification and metadata, retention scheduling, the ability to track access to records at any stage of their life cycle and robust search capabilities, federated, if possible.
Once in place the governing e-records management policy and the selected ECM platform, which should include email intelligence capabilities, will provide the foundation for all Litigation, Compliance, Security (archiving and backup) and Intellectual Property discovery and access requirements. This would include, but not limited to, civil or criminal proceedings, government regulatory inquiries, audits and reports, investigations and disaster recovery. Imagine some of the benefits that will accrue from a federated approach:
- Eliminates the risk of spoliation by ease of executing a litigation hold
- Ability to be proactive in managing litigation risks
- Compliance with the new FRCP amendments
- Facilitates response and production strategies
- Timely responses to regulatory agency requests
- Facilitate Sarbanes-Oxley watchdog applications and audits
- Ease of managing secured levels of content access
- Ease of managing company communications policies
- Ease of managing company archives
- Ease of executing company disaster recovery plans
- Ability to control and organize content designated as intellectual property
- Prevent the loss of intellectual property with departure of employees or contractors
- Facilitate the development and maintenance of the company knowledgebase
Each of the above benefits is a prime example of essential risk management in today’s business environment. Such benefits, if realized, might result in saving of millions of bottom-line dollars and might save the company itself and/or its management from public humiliation or criminal prosecution.
Management and control of an organization’s digital assets is no longer an optional business process reserved for Global 2000 companies or regulated industry organizations. With our global economy, the proliferation of technology and access to it and digitized communication at every level of a company’s business, “playing ostrich” and avoiding instituting appropriate controls would be nothing short of negligence in the executive suite. For organizations starting such an undertaking from the beginning, this could be a daunting task. However, with a little outside help everyone involved will survive the process. The process begins by involving the stakeholders in the affected departments including those accountable for legal matters, technology, compliance, security and human resources and chartering this group to provide answers to the following questions:
- Where are we?
- Where are we supposed to be?
- Why is there a difference?
- What are we going to do about it?
The next step will be to assign a Project Manager. This is not an assignment for a "rookie." Select someone who has project management experience, understands technology and knows your organization. This key step is so important that it will be the subject of an article in next month's newsletter from an e-discovery perspective. We would also recommend the assignment of a senior management member to work with the assigned project manager to provide necessary high level oversight. You should also plan to engage an outside consultant or firm conversant with the domains of ECM, e-records management, e- discovery, compliance and intellectual property. Few consultants, or consulting firms, are all things to all people. Therefore, you may wish to select one as the “prime contractor” who will involve and manage any specialists required. Depending on the current state and needs of a given organization, the project from concept to completion should take about four to twelve months. For the duration of the project, starting as early as possible, a critical component of the project that will ensure its success should be a priority – training and orientation.
As so aptly put by Sir Francis Bacon late in the sixteenth century, “Knowledge is power.” Said another way, it is easier to play the game if you know, and understand, the rules. Whether the “rules” are the new amendments to the FRCP, the Sarbanes-Oxley or Hart-Scott-Rodino acts, applicable case law, or the usage instructions for the new software application just installed, knowledge IS power. When you understand the “rules of engagement,” you will always have the advantage. You will be better prepared to negotiate, to arbitrate, to discuss, to strategize, to review, to draft – to achieve the desired result.
On December 1, 2006, life and law as it exists will change for legal professionals as the amendments to the FRCP become effective. What has your firm done to ensure that all Partners, Members, Shareholders, Associates, Paralegals and Staff involved in any form of litigation understand what the amendments mean to them? What has your firm done to ensure that your clients, the ones that help pay the rent, understand the changes taking place and what how the amendments will affect their current business processes and what must be done for your firm to represent them effectively?
Do you have designated individuals responsible for the training and education of your staff as well as your clients. Would these individuals be comfortable explaining the details, pitfalls and alternatives of relevant terms such as “spoliation,” “load file,” “OCR,” “metadata,” "auto- coding," "unitizaton," "native file review," “fuzzy search” or “TIFF?” How about new, or updated, software applications – when was the last time the people working daily with the software had a remedial training session including tips and tricks to improve efficiency? When was the last time senior management and practice chairpersons participated in a training or orientation session on technology or best practices?
By training your professionals, you empower them to do their best inside and outside the office. By doing their best, your firm/department lives up to the value proposition originally presented to your clients or corporate mission statement. An investment in your people is money in the bank. If you do not have the necessary training resources in-house, outsource the task to a technology partner. Additionally, when appropriate, partnering with your technology partners and offering workshops for your clients is more money in the bank.
