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Bar News - December 21, 2016

Attitudes on e-Discovery Evolving in NH

Crunching the Numbers

Taking the example of a case with 1,000 email documents requiring about 1 gigabyte of storage, the following shows an estimated cost breakdown for e-discovery services at current market rates.

  • Preservation of 1 GB mailbox: $75
  • Pre-culling (removes all duplicates and documents outside date range, meets author/recipient requirements, and other objective criteria): $50 (per GB)
  • The resulting fraction of GB gets hosted: $35 (per GB) hosting + $75 user fee per user per month
  • Cost of production, $0.08 per page x 3,000 pages = $240
  • $30 for page numbering/endorsement (Bates numbering).
  • Total cost: $505*

The preceding steps provide a searchable database of only the relevant documents while preserving all of the original data in a single location that can be accessed through a secure web portal. Additional paper, longer hosting periods, and additional copies and work products would add to the total expense.

*Cost figures provided by Evidox.

If the process of discovery is like finding a needle in a haystack, then electronic discovery technology works like a magnet. By enabling litigators and support staff to cull a dataset to a fraction of its original size, programs that de-duplicate, thread email, suggest search terms or employ predictive coding can yield substantial savings of time and money that can be passed on to clients.

In the past, this technology was reserved for rare cases – complex, high stakes litigation involving terabytes of preserved data. That view has evolved. As attorneys and courts have become more comfortable with e-discovery platforms and the notion that not every document needs to be reviewed by an attorney, litigators are finding that even a case with 1,000 documents can cost-effectively benefit from technology-assisted review.

“Nowadays, virtually all clients are communicating electronically and virtually any case can have e-discovery,” says James Berriman, CEO of Boston-based e-discovery services provider Evidox. “It used to be that e-discovery was a more extraordinary event, and now it is a more ordinary event… Lenders and insurance companies still have paper and ink, but many businesses and transactions, especially in healthcare, are fully electronic.”

In New Hampshire, the acceptance and use of e-discovery technology varies considerably, ranging from a firm that has invested heavily to license e-discovery software and expand data storage capacity in-house to attorneys who continue to perform linear review of documents on paper, even in cases with high volumes of electronic data. Most litigators in New Hampshire fall somewhere in between.

Bruce Felmly, a longtime leader at McLane Middleton, has watched the evolution of e-discovery in practice and more broadly in the field as a former board member of the American College of Trial Lawyers.

“I think New Hampshire was ahead of the curve in having a task force in the Superior Court – and I served on it – to look at the rules around e-discovery and create proportionality and balance,” Felmly said. “Now, we’re on the edge of a much wider use of the predictive coding software for documents and emails, to create protocols for searching. This approach will increasingly be employed in large data searches.”

In part, decisions about how and when to automate the processing of electronic data in discovery have been made based on assumptions about the cost of e-discovery services. Under NH Superior Court Rule 25, which governs e-discovery, discovery costs must be proportionate to the significance of the issues or the amount at issue in a case.

New Hampshire does not have the large industry and frequency of high-value cases that have led e-discovery capabilities to become more commonplace in other jurisdictions. Correspondingly, practitioners here work in a smaller, more collegial environment that tends to facilitate agreements between parties to limit the scope of e-discovery, even when large amounts of electronically stored information (ESI) are potentially relevant to a case.

Shelagh Michaud, an attorney at the CullenCollimore firm in Nashua, was a network systems consultant before she became a lawyer. Since law school, she has worked on a number of e-discovery cases and has led e-discovery seminars for New Hampshire attorneys and judges.

“It’s hard to imagine a case where [electronic discovery] might not be a potential issue, but if it’s a $1,000 car accident, maybe it’s not important enough to ask. If it’s a $100,000 business dispute, maybe it’s really important,” says Michaud.

The 2009 NH Supreme Court decision in NH Ball Bearings established that New Hampshire looks to federal cases for guidance on e-discovery analysis. Those cases, and amendments to the Federal Rules of Civil Procedure that took effect a year ago, have further emphasized the importance of proportionality in both preservation and production. Accordingly, e-discovery services providers have made proportional parameters for producing ESI a central focus and have worked to lower costs.

Despite new rules, lower costs, more user-friendly e-discovery platforms, and the fact that understanding e-discovery is increasingly viewed as part of an attorney’s obligation to provide competent representation, many attorneys continue to resist technology-assisted review.

“It hasn’t been a major issue in New Hampshire, and therefore people haven’t made it an issue. New Hampshire Ball Bearings was a large case, and perhaps that should’ve been the warning shot, but there haven’t been more really large reported cases, so people feel comfortable that they can continue without it,” says Michaud. “Some attorneys just don’t want to deal with it. They don’t always understand it, and they really don’t know what to ask for. If there’s an important email, they print it out.”

Early seminars about e-discovery positioned it as costly and complex technology, but as the pricing and tools have evolved, so have the perspectives of judges and the potential for cost savings through increased efficiency.

“E-discovery can seem complicated, but it’s really just discovery in a different form,” Michaud adds. “Ethically, the rules say we can’t ignore technology, and this technology has the power to change our cases and the way we practice law for the better.”

When Should Discovery Be Electronic?

The days of banker’s boxes stacked in conference rooms where paralegals pore over piles of paper for months are becoming the stuff of legend, as attorneys today can save clients time and money with in-house or cloud-based e-discovery software and some expertise.

In cases where what’s important is proof of what was said – as opposed to when it was said to whom and at what point it was shared or edited – reviewing email on paper can still be a viable option, says Michaud. Likewise, in a case where the only document to discover is an accident report, it doesn’t make sense to automate.

But when discovery requests cover entire hard drives or email inboxes, the ability of e-discovery systems to manage the volume and remove duplicate documents can be cost-effective. With legal issues like insider trading that involve a pattern of conduct, and thus don’t lend themselves to keyword searches, e-discovery can help determine criteria for document relevance.

The benefits of using e-discovery extend beyond preservation and production. While paper documents must be repeatedly reviewed throughout the case, as more information comes to light, e-discovery platforms index the documents, enabling attorneys to quickly search specific repositories for words or phrases that were unknown in the early stage of the case. This search capability also assists attorneys in preparing for depositions and trial.

“Once documents become paper, they lose their connection to the searchable discovery database,” says Berriman, of Evidox. “By keeping it together, all of that data stays together, including attachments, so there are a lot of advantages to keeping it electronic.”

E-discovery processing can take on a variety of forms at a range of costs. Just threading email to remove duplicates and identify responsive messages is much cheaper than predictive coding, an expensive process that uses artificial intelligence to eliminate huge amounts of human review time. E-discovery changes depending on the type and facts of a case.

“Every algorithm is different. Every case starts off fresh,” says Charlie Stewart, manager of electronic discovery services at Sheehan Phinney in Manchester.

Small Firm, Big Data

A former architect, Stewart now oversees operations and training for the firm’s new Relativity e-discovery software system, a licensed product made by Chicago-based kCura, which runs on 13 servers located at the firm’s Elm Street offices.

Among firms that have invested in developing this kind of in-house e-discovery system, Sheehan Phinney is relatively small. But the firm has already handled more than a few cases with extremely high document volumes, including helping to represent the state in a class action alleging deficiencies in the state’s mental health system. That case involved 115 terabytes of data, including 26 million emails. Using a combination of the 11 different tools available through the Relativity software package, Stewart was able to whittle that incomprehensibly large dataset down to manageable subsets of responsive documents.

Stewart explains that through predictive coding, the system “learns” to recognize relevant documents through a process of attorney review and input. “The humans will do a portion of the review and then the system will say, ‘Okay, I’m ready to code the whole set,’” he says. “It doesn’t cut the attorney out; it just puts them in a more supervisory role.”

The systems do, however, eliminate work historically performed by law firm associates and contract reviewers, who at large law firms used to be hired for months at a time to plod through mountains of paper, hunting for the proverbial smoking gun. Now, contract reviewers might spend a few weeks, even in the largest cases. For their part, associates are increasingly being expected to have a technology background coming out of law school, so that they can comfortably work with e-discovery systems and know how to discuss IT issues with clients, says JP Harris, a partner/shareholder at Sheehan Phinney who oversees the firm’s e-discovery services work.

Harris says the firm has already started to work with smaller law firms in Massachusetts, becoming co-counsel for the purpose of assisting small-firm lawyers with their e-discovery needs.

“The reality is that the statistics show the system is much better than human review,” he says. “The judges are starting to come around on this fact, too. Seven or eight years ago, you’d have a hard time convincing a judge that you could skip laying eyes on every document… Pretty much everybody realizes at this point that this technology works, and the court recognizes that.”

Social Media Searches

In many cases, particularly in the family law arena, Facebook status updates, tweets and Instagram feeds contain material ESI, and many attorneys spend considerable effort to find and preserve it.

“It is e-discovery but it’s just in a different way,” explains Michaud.

Just within the past two or three years, however, it has become more difficult to tap social media sources, the sheer number of which has grown exponentially during the same period. “A lot of these social media lawsuits made the news, and people started locking down their accounts,” adds Berriman.

Unless an attorney can somehow convince the opposing side to download their client’s Facebook account into a handy .zip file and hand it over (highly unlikely), the ability to access data from Facebook and other social media sites is now more limited. “You really have to go on their pages and review what is public yourself,” says Michaud, and that’s assuming you know which platform the person is using.

“I think in a way the social media discovery area might have peaked,” Berriman said. “Emphasis on security and the awareness of security has caused social media to become a more secure environment.”

Michaud is not entirely convinced. She and other attorneys have found that even when someone has made his or her profile non-public, searches on social media sites can still yield considerable results in terms of evidence. Additionally, she says, savvy and attitudes about privacy settings can vary across generations.

“Most people’s photos are at least partially wide open,” she said. “It’s getting more common to find a profile that’s completely locked down, but it’s still rare in my experience.”

Discovering the ‘Internet of Things’

So, what’s next in the world of e-discovery? Already ESI has expanded from hard drives, phones and inboxes to social media, cloud-based repositories, and devices like EZ Pass and vehicle black boxes, providing a host of challenges to attorneys seeking to preserve and collect evidence. Now, the proliferation of so-called “smart TVs” and other connected devices and appliances means that the smoking gun might be in the shape of the accused’s toothbrush.

“We’re living in a world that’s becoming increasingly communicative,” says Stewart. “My toothbrush has got ESI in it now. There’s ESI in toasters, it’s everywhere, and they call that the Internet of things. In some cases, it’s material, the smart TV, when it’s on or off... If his toothbrush is reporting he’s in Singapore, then I want that data. There are more and more things that are becoming connected, and that’s the future.”

The number of digital footprints each person leaves behind just in the course of daily life is already astounding, and when a lawsuit is filed, all of it becomes potentially relevant. “The lawyers right now don’t even know to ask these questions to find out what devices are out there that possess these data,” says Harris of Sheehan Phinney.

Thanks to New Hampshire’s small, collegial bar, as well as its clear and thorough ESI rules, attorneys in the state have an opportunity to collaborate on enhancing skills and understanding related to e-discovery, including in what kinds of cases it should be used.

“In New Hampshire, it’s not going to cut it to go to the court and have the court decide which search terms we’re going to use,” says Michaud, of CullenCollimore. “I’d rather work with people cooperatively, and e-discovery is really at its best when it’s done cooperatively. It’s better for the client, it’s better for the court and, in the end, it’s better for the process.”

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