Essays

There is more news of market consolidation with the announcement that Autonomy will buy CA’s Information Governance division. CA slowly built the IG group with the purchase of iLumin in 2005 and then MDY in 2006. That gave CA the archiving and records management capabilities necessary to have the information governance foundation. Sadly, CA was just never the right fit and the information governance message was perhaps a little bit ahead of its time. Autonomy, meanwhile, doubled-down on eDiscovery with laser focus and has emerged as one of the most successful companies in the industry due to that commitment. It now has even stronger records management capabilities, even if it also has to deal with supporting a lot of duplicate technology.

GM has been asked to preserve all electronic communications instead of deleting them in accordance with its 60-day retention policy. A 60-day retention policy with no backup program in place is just another example of companies instituting retention programs that don't help the business and that virtually ignore good eDiscovery practices.

AccessData announced it will merge with CT Summation to form a single company, AccessData Group, LLC. The goal of merging the two companies is to deliver a solution capable of addressing all phases of the EDRM model. While the newly formed solution will touch the full spectrum of the EDRM, AccessData Group will face stiff competition from best-of-breed point solution providers, as well as larger enterprise software vendors, in a market where corporations are not necessarily decided on whether an integrated solution or a point solution is the right choice.

Yesterday I was the guest speaker for the monthly meeting of Houston Association of Litigation Support Managers (HALSM). When we polled for topics of interest, the first request concerned how to position and explain the value and role of outside service providers to attorneys at the law firm or corporate legal department. The recent economic downturn put pressure on litigation support staff everywhere to do more with less. Management are asking hard questions like, “Why do we need vendors if we have you?” Or worse, “If we have to use a vendor, why do we need you?” We had the highest HALSM meeting attendance in memory with 25-30 folks packed into a large conference room for the lively discussion.

Everyone talks about the ‘explosive growth’ of discovery collections. Every once in a while we get a glimpse behind the curtain at the sheer size and complexity of large matters. Browning Marean posed a question to the EDRM Search project that resulting in my wasting an entire afternoon dissecting the 511 page examiner’s report from In re Lehman Brothers Equity/Debt Securities Litigation, 08-cv-05523, U.S. District Court, Southern District of New York (Manhattan). Now I do love to geek out on metrics of all kinds, but what drives me is trying to understand the impact of numbers in context. In this case, we get to see the actual search criteria created by 20 Jenner & Block attorneys to find everything related to the downfall of the investment firm.

My very first Journal entry, The Myth of Custodial Selection, explored the very real discrepancy between what your designated custodians think might be relevant and reality. Now the Delaware ruling of Roffe v. Eagle Rock Energy GP, et al., C.A. No. 5258-VCL (Del. Ch. Apr. 8, 2010) seems to assert that custodian self-collection is inadequate and all collection must be done under the direct supervision of counsel. Barry Murphy tackled some of the potential implications and solutions in his article on Standardized Collection Workflows. I would like to assert the need for technology to enable custodial self collection or ‘custodial designation’ as an integral part of any preservation and collection effort. In my recent examinations of Enterprise Desktop Collection, Self Collection is the first and dominant methodology outlined. That is because even if you do a full forensic image of every desktop, I believe that you are still obligated to interview key custodians and ask them for relevant ESI. No one wants to try and explain why a reviewer missed a key document that your star witness knew was the smoking gun.

In Part 1, we explored the basic methods of collecting from desktops in the large enterprise environment. The recent Delaware ruling of Roffe v. Eagle Rock provided a good context to discuss the potential pitfalls and necessity of custodial self-designation of potential evidence. That brings us around to the lowest risk/highest effort method, full forensic images of desktops. I want to be very careful here to differentiate a bit-by-bit image of the physical drive from the more commonly used ‘forensically sound copy’. A forensic image captures every one or zero across the entirety of the physical drive. This means that an 80 GB laptop drive will have an 80 GB forensic image, even if there are only 20 GB of files on it. A ‘forensically sound copy’ uses the operating system to capture the content (Hash verified) and the context (OS metadata) of selective active or deleted files. Now that we have made that clear, we can move on to enterprise forensic collection, which I am taking to mean the ability to collect a full forensic image without having to physically attach a write-block device.

The Daegis acquisition by Unify caught my attention this morning as I was coding the latest batch of news and blogs from the eDJ search engine. After the 2009 slump, I expect to see a string of consolidation and acquisition within the eDiscovery market. Knowing some of the talented folks at Daegis (including some of the best of SPI), I did not expect them to be acquired for a 1.5 multiplier. That was a shocker. Daegis reported $24 million in revenue with a healthy 27% profit for fiscal 2009. That was pretty good for last year. So why did they accept $38 million in cash, notes and stock? They are advertising it as a merger and taking the Daegis name, which indicates that they are going after the corporate eDiscovery market as opposed to the corporate archive or database support market. If that seems confusing, consider that Unify specializes in database management and migration software. Unify acquired AXS-One for $8 million in stock last June. AXS-One seemed to be struggling in the archiving market, which has been consolidating for a while.

Almost every new processing or review application that I have seen over the last year has featured a left hand navigation window that enables users to dynamically filter the collection by Author, Date, Type and more. You can call this faceted navigation, guided search or browsing navigation, but it boils down to the user’s ability to actively browse/filter the collection by metadata characteristics and categories that have been extracted from the index. Although this seems like just another way to construct a search, this feature offers a lot more to the discerning user. In older platforms, users had to run reports on their collections to extract the summary population metrics across different fields. The first one that I recall was the Tally function in Summation. This could only be done one field at a time, but unlike most static reports, you could generate the tally numbers on a set of search results instead of the entire collection. Current review, processing and even archiving products like Clearwell, Relativity, Introspect and Symantec’s Discovery Accelerator can generate these hierarchical ‘facets’ across multiple fields and display the total and item level counts dynamically in real time.

The firm of Gibson Dunn has published a survey that covers 103 eDiscovery cases from the first half of 2010. To catch the overall legal implications, Ralph Losey has done his usual excellent analysis riffing on an Andy Warhol theme this time. I wanted to pull out some trend highlights and talk through the potential impact on corporate stakeholders who are struggling to implement a full eDiscovery process. Although there have been some large and well publicized eDiscovery sanctions going back to Zubulake v. UBS Warburg, the total number and cost of civil sanctions against the overall litigation scope has not been sufficient to compel most corporations to invest in defensible process. Corporate legal departments are a cost center. Corporate counsel must make risk versus cost decisions every day and the realistic risk of sanctions has not measured up to the cost of doing discovery ‘right’ for many or most companies.