Migrated from eDJGroupInc.com. Author: Barry Murphy. Published: 2010-10-21 12:00:37Format, images and links may no longer function correctly. As always, there were some interesting tidbits in the Fulbright & Jaworski Annual Litigation Trends Survey (this one was the 7th annual report).  The report covers a lot of ground including trends for fee arrangement, the tactics for handling international disputes, the types of matters organizations face the most (and the different ways each type of matter impacts litigation costs), and eDiscovery.  At eDJ, we looked for the nuggets of data about eDiscovery that are most interesting and compelling – there were several:

–       Most respondents expect litigation levels to either stay the same or increase.  While there are some that expect the amount of litigation to decrease, more believe it will increase.  More litigation activity means more eDiscovery.  In the near-term, that’s good news for service and software providers, as it creates demand for their solutions.  It’s bad news for corporations however, most of whom still seem to be behind the curve when it comes to preservation, collection, and Early Case Assessment (ECA) programs.  Until these companies can implement eDiscovery programs that make it more efficient to collect and preserve information, increasing amounts of litigation will simply mean higher costs.

–       More than half of respondents still rely on individual custodians to identify and preserve their own information.  The reliance on custodian self-collection points to a continued immaturity in eDiscovery programs at the corporate level.  As Greg Buckles has pointed out, there is still a place for self-collection, but reliance on it is a risk (and not allowed in Delaware).  It’s time to take a much closer look at implementing processes and tools that automate and centralize collection and preservation.

–       Many organizations are increasing the number of in-house resources (lawyers) they employ.  We are starting to see signs of movement up the learning curve.  It’s encouraging to see enterprises increasing the number of in-house resources.  While the survey does not dive into what those resources do, we can certainly speculate.  They may be part of eDiscovery practice teams, interactive with records managers and IT staff to implement more proactive eDiscovery programs.  They may be conducting more and more ECA in an effort to make better matter decisions earlier in the process.

–       Almost as many US companies have decreased litigation budgets and spends as have increased them.  While decreases litigation budgets and spends may sound like a real downer for the industry, I think this really just gets at the fact that enterprises are getting smarter.  They will begin demanding ECA tools in an effort to avoid downstream litigation costs.  Tighter litigation budgets could still mean more money flowing into the eDiscovery software market.

–       Most believe that alternative fee arrangements and tighter cost controls will be the norm.  As mentioned in the previous paragraph, costs controls are actually a good thing for the market (especially solution providers that can help avoid or reduce litigation costs).  The subject of alternative fee arrangements gets at the fact that the business of providing legal service is going to change.  Law firms will need more tools that allow them to get through information faster and cheaper.  If they don’t, they will be at a competitive disadvantage.  Years ago, some law firm partners told me I was crazy if I thought fixed fee engagements could ever become the norm.  I feel a little less crazy now.

–       Almost one-third of respondents believe there will be a significant increase in spending on eDiscovery in the next 12 months.  Coupled with the fact that enterprises are bringing more resources in-house, this nugget really does point to the beginnings of customer maturity in eDiscovery.  It’s time to invest in – at a minimum – tools for collection, preservation, and ECA and smart corporations get it.  Those that don’t will find themselves repeating the same mistakes over and over.

–       Most believe there should be limits on eDiscovery in civil matters.  I’m on board with the fact that the Amended FRCPs leave something to be desired.  Terms like “reasonable” and “good faith” are hard to define and non-prescriptive.  At the same time, though, limiting discovery will open the door for organizations to continue being eDiscovery ostriches.  It might give them license to destroy information that they really should be keeping, or to spend more money arguing why they can’t discovery information than they would in correctly managing it.  There is a happy medium somewhere, but we are a couple years away from identifying what it is.

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