Migrated from eDJGroupInc.com. Author: Conrad Jacoby. Published: 2014-04-08 20:00:00Format, images and links may no longer function correctly. 


Sexier than hardcopy

But not the sole source

Anyone who’s spent much time working in the e-discovery community has horror stories about projects that went horribly wrong and catastrophes that were narrowly avoided—or sometimes not avoided at all.  Sometimes, you can blame technology.  More often, though, the problems come from the human side of things.  We lawyers can be inconsistent.  We can be forgetful.  And sometimes, we focus on what we think is the right answer before we actually perform the analysis that supports that conclusion.

Some years ago, I consulted on a litigation matter where the client was a bankrupt entity suing a much larger, much better funded opponent.  Although the client believed it had a very strong case for its breach of contract claims, every litigation dollar had to be spent carefully, and all significant expenditures had to be approved in advance by the bankruptcy trustee.  To this day, I’m still not sure exactly how the client procured the working funds to move the case forward.

Early in the case, before my involvement, the parties had agreed to limit discovery requests solely to electronic materials to reduce costs.  E-mail, especially, was seen by both sides as most likely to contain the key evidence required to decide the case.  Almost as an afterthought, the litigants also agreed to preserve and collect potentially relevant hardcopy materials as well, but discovery would include these materials only upon certain negotiated conditions.  Back in the early 2000s, processing this electronically stored information (“ESI”) would cost the client over a hundred thousand dollars, plus at least twice that much in document review costs. 

A key question of fact was the degree to which my client’s board of directors was aware of certain facts during the contract negotiation process.  The legal team gathered potentially relevant evidence by running searches of the processed ESI and then reviewing a voluminous number of e-mail messages (and associated attachments) to and from the directors and various corporate officers during the critical time period.  They also reviewed both drafts and final copies of board minutes—all of which were part of the ESI exchanged in discovery.  Armed with this evidence, the legal team was able to negotiate a favorable settlement for the client, and the case was officially closed.

As part of the winding down process, I was asked to advise the client on cost-efficient ways of storing a relatively small volume (~20 boxes) of hardcopy materials that had been gathered for the case, but set aside.  To better understand these documents, I opened the first box to see whether these materials were genuinely unique or simply printouts of ESI that had already been processed.  To my astonishment, the box was full of board of directors meeting handouts, each one heavily annotated by individual board members whose handwritten comments reflected the exact conversations and debates that had taken place at the meetings.  These handwritten notes tracked the real-time impressions of the board members, including their immediate reactions to the subjects at hand and internal disagreements that were ultimately resolved.  There was no question that these documents would have been materially important in answering the question of BOD scienter, and there was also no question that no member of the client’s legal team was aware that these materials existed, much less had reviewed them for their substance.

In an effort to reduce litigation costs to their minimum, members of the legal team had managed to overlook documents that might have decided the case without the need to process any ESI or conduct the long, complicated document review that followed.  The client did receive a positive outcome, but I’ve always wondered whether the outcome would have been even better if this old-school hardcopy evidence had been used instead of the voluminous and expensive e-discovery path that was chosen.

Conrad Jacoby – eDiscovery Expert Consultant – Seventh Samurai 

Contact Conrad at Conrad.Jacoby@Seventhsamurai.com

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