Migrated from eDJGroupInc.com. Author: Mikki Tomlinson. Published: 2013-06-03 05:23:29Format, images and links may no longer function correctly. The preliminary results of eDJ’s Legal Hold Notification 2013 Survey are in.  The survey shows that 45% of the 106 respondents rated their procedures “mature” for issue and release of legal holds.  However, only 23% of respondents indicated that they have mature audit and reporting capabilities.

I have preached many times that “you can’t manage what you can’t measure” and if that is true, where does that leave legal professionals who cannot audit or report on the efficacy of their legal hold programs?  I call this kind of method, “Legal Hold Lite” because, unfortunately, it is often strong enough to withstand a little bit of pressure, but too weak to handle any serious stress on the system.

Organizations whose system is in the Legal Hold Lite category are generally going through the motions and simply “pushing buttons” without paying a lot of attention to the potential consequences of the Lite approach.  A detailed examination of the circumstances that lead to this kind of scenario will be discussed in my upcoming eDJ Legal Hold Research Reports, but for now, I will provide a modest sampling and high-level overview of some of the causes and effects of a less than solid legal hold program.

Almost daily it seems we read about frightening sanctions imposed on parties, both plaintiffs and defendants, for failure to preserve through adequate legal hold. However, it is apparent to me based on my consulting work that many organizations do not believe they are at risk as long as they have a legal hold program in place, even an ineffective one.  Luckily for them, not all Lite legal hold preservations lead to sanctions or adverse inferences, BUT, poor practices do lead to disorganization, confusion and cost overruns.  Over time, these add up and increase both risk and cost.   And once the spotlight is turned on, the light will shine through and expose the gaps.

I will spare you a recitation of scary case law and instead point out a couple of issues I often see in Legal Hold Lite programs.  One common practice is not issuing release notices to custodians when matters are closed.  On the surface it may seem harmless, but there are tangible impacts.  Primarily, there is an increased cost and effort in holding on to data that would have otherwise been purged in the ordinary course of business. The unnecessarily preserved ESI may be preserved or collected in subsequent legal matters because it still existed at the time of the new preservation triggers.  Thinking more abstractly, what message does an untended program send to employees about the importance of legal hold if the system never releases any holds?

Another common practice is to copy IT personnel on legal hold notices with no clear instruction on what actions are required.   Legal Hold Data Stewards[1], need to understand their role in the legal hold process and its importance.  IT or other infrastructure personnel who fail to appropriately participate in legal hold can create disastrous consequences for the organization.  The results can vary from completely ignoring the directives (failure to preserve=sanctionable behavior) to over-preservation.

To illustrate, here is a real world war story:  Company X issued legal hold notices that called for preservation of any and all possible types of data – much like the old boiler plate requests for production, such as “…operational systems, facsimile transmissions, optical disks, magnetic tapes/backup tapes…”  One of the IT recipients, being a good corporate citizen, followed the instructions, as he/she interpreted them, and pulled backup tapes from rotation.  This went on for a lengthy enough period of time and accumulated a significant number of tapes.

Eventually, there was an IT initiative to move to a new backup system so they approached the legal department requesting direction on what to do with the tapes, which is how legal came to know that tapes were pulled and held.   As it turns out, the person that pulled the tapes (no longer employed at Company X) failed to mark which holds applied to which tapes and left no evidence as to the logic behind which tapes were pulled.  Adding another ingredient to the mix, the legal department had been lax in releasing holds (see above).  What they ended up with was a huge pile of backup tapes on their hands and a very expensive remediation project.

The point I am making is that a solid legal hold program requires more than pushing buttons and going through the motions; it cannot be approached lackadaisically.   It requires standardized procedures through the entire life cycle.  It is important to note, however, that this doesn’t have to be an overly difficult undertaking or cost hundreds of thousands of dollars.  When it comes to developing a legal hold program that can hold up in a challenge, the Devil is in the details.  Stopping at the button pushing stage will only leave you vulnerable.  Taking those few extra steps to work through the details can yield significant benefits that far outweigh the effort.

Mikki Tomlinson can be reached at mikki@edjgroupinc.com for offline comments or questions. Her active research topics include Legal Hold Notification, Legal Hold Process Management: Progression of legal hold notification to collection workflow (project management) and collection tools, and eDiscovery Education.  .

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[1] A Legal Hold Data Steward is an individual in charge of a computer system or process.  A steward of data is responsible for the system that holds the information, but is not responsible for generating the content that is stored in the system.


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