eDJ Migrated

No sooner did Recommind announce that it had patented predictive coding was there an article in law.com about the unhappy reaction of Recommind’s competitors. With the blogosphere chirping, I thought it a good idea to weigh in on this news. I read the Recommind press release, which states that the patent covers “systems and methods for iterative computer-assisted document analysis and review. This patent gives Recommind, its customers and its partners exclusive rights to use, host and sell systems and processes for iterative, computer-expedited document review.” It is not hard to see why competitors are reacting defensively to this release – it would appear at first glance that Recommind would be the only company allowed to provide predictive coding software.

A new eDiscovery malpractice lawsuit was filed this week, J-M Manufacturing v. McDermott Will & Emery. The central issue is the production of 3,900 privileged documents in a 250,000 document qui-tam investigation. Nate Raymond at Law.com/LTN gives a good summary here. This case was definitely the hot topic at last night’s Houston b-Discovery social meeting. In reading the complaint, a couple things jumped out at me.

Twice in the last month, I have monitored client enterprise system issues that were caused by ever-expanding back-up time. Now generally I am not down in the pits with the admins wrestling to keep massive communication, archiving, etc systems stable any more. However, I have recently been asked to serve as the corporate 30(b)(6) witness on enterprise systems. That means I need to understand their history, architecture and to monitor their ongoing health. Back-up windows have always been a necessary evil for enterprise systems that constantly ingest new documents. There are many replication and live fail-over systems that avoid taking systems off-line, but old fashioned tape back-up seems to dominate my client base. This means that legal searches, placing holds and retrievals are effectively stopped 4+ hours per day. The impact of a 15-25% productivity loss becomes all too clear when trying to give clients a realistic estimation for large PST migrations, archive conversions, legal hold initiatives and even critical case productions. Imagine telling the U.S. Attorney that their data will be another couple weeks just because we have to back up the system every night.

Microsoft’s SharePoint has achieved significant market traction over the past decade – various research studies show the level of organizations using SharePoint ranging from 50% - over 90%. Clearly, SharePoint is a force to be reckoned with. The eDiscovery market took notice of SharePoint in the last few years and we’ve seen archiving and collection solutions become available. While SharePoint has appeared in real cases, it has not reached critical mass as an eDiscovery issue just yet.

Things couldn’t be better for me these days at eDiscovery Journal. There is so much going on right now in the eDiscovery industry even with the annual “August Downtime” coming up in a few weeks. I have been on the phone every day since I started work speaking with eDJ’s clients and sponsors. The feedback on Barry and Greg has been exceptional (no surprise there) and I’m confident my move to the eDJ was a good one. One of the organizations that I’ve been working closely with over the past couple of weeks is IQPC. These are the folks that put on conferences around the globe on many different topics and industries. I have presented as well as attended quite a few of these events over the years, and have always enjoyed the curriculum and presenters. The good news is that eDJ and IQPC will be working together in the coming months on several of their programs.

I recently had the opportunity and privilege to give my perspective to the international working group of the Commission on the Leadership Opportunity in U.S. Deployment of the Cloud (CLOUD2). The commission has a three month mandate to provide the Obama Administration with recommendations to support our growing cloud industry. Many of my global corporate clients have struggled to reconcile their eDiscovery, regulatory and storage requirements across their diverse business units in various countries. Preparing for my presentation brought me the realization that we really are moving to the cloud, dragging the luddites along kicking and screaming. I gave a bit of background on the challenges I saw facing global corporations and moved on to why even large enterprises are exploring migrating their systems and data to cloud or hosted services.

I had a chance to sit down last week with Johannes Scholtes, Chief Strategy Officer at ZyLAB. I’ve followed ZyLAB for years now and was pleased to see the company so focused on the eDiscovery market. Too often, vendors in the information management world try to offer too much and solve too many problems. That leads to confusion on the part of prospects as to exactly what they need to buy. Now, ZyLAB is not abandoning the broader information management market, but the company is focusing its efforts around what it can sell today – eDiscovery applications.

As I was walking through Planet Data’s latest hosted offering, I was struck by the freedom that web based applications have to assemble key features to support specialized workflows. After all, if you have all the basic functions, it is merely a matter of presenting them in a clean set of web pages. We tend to forget that eDiscovery is still relatively new and the vast majority of our actual software users are still just getting up to speed on the technology. Litigation support staff, service providers and consultants live and breathe all this, so we know the context and can navigate a crowded graphical user interface (GUI) full of mysterious icons and mouse-over terms of art like dedup, fuzzy, family, etc. The effort to create stand-alone traditional software that had to function in diverse environments and support a wide variety of usage scenarios produced highly complicated, crowded feature toolboxes such as Summation. Exego Early Cost Assessment is a good example of how cloud development can create a streamlined workflow to meet a specific set of requirements.

When a major eDiscovery controversy breaks out, the eDJ team usually gets on a call to discuss and designate who should take the lead in response. Barry Murphy did a great job going to the source on the Recommind predictive coding patent announcement. I also enjoyed Herb Roitblat’s analysis of the patent content. At first, I did not figure that I had anything to add that had not been covered. Numerous ongoing discussions with clients, sponsors and contemporaries made me realize that I did have two cents to toss into the whirlwind. Designing and consulting for software companies got me in the habit of digging into the use of open source and potentially patented technologies. I know of many patents held by early innovators that have never been enforced on the market.

Part of my job is to meet with the investment community (venture capital, private equity, investment banking) and talk shop about the state of the eDiscovery market. Lately, the same question keeps coming up over and over: “is the eDiscovery market saturated?” Certainly, I can understand the question; the Symantec acquisition of Clearwell has created renewed interest in our market. Clearwell got a very nice multiple…in case you didn’t know, the term “nice multiple” does not escape the ears of the investment community. But, there seems to be a perception that the market is saturated and there are no ankle biters on the radar or sure winners on the way up. While there are definitely some over-capitalized vendors out there desperate for more cash or an acquisition, I believe this market is not even close to saturated, and I’ll offer an example of why.