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LAUREN EVERHART: Corporate America has been going through an industrial revolution in regards to the introduction and implementation of technology. Why has this change occurred and what effect does it have on corporate counsel?
PETER GRONVALL: The role of technology is fundamentally transforming the way in which corporate counsel and their law firms approach the practice of law today. This change is occurring because of the exploding data volumes that are overtaking corporate America, introducing a whole new set of issues — from corporate risk concerns, to the legal issues that ensue, and to data privacy issues. A key driver for these changes has been new procedural rules that dictate how litigants have to march through legal matters, including e-discovery and litigation. In particular, I’m referring to procedural rules as they relate to the handling of electronically stored information, or ESI as it is commonly called. These imperatives are changing the role of corporate counsel from an historically reactive role to a proactive role. Corporate lawyers can no longer merely “react” to litigation or episodic legal events, but rather they must confront the reality that they are now put at the forefront of having to serve their organizations as risk officers: understanding how information risk has now been introduced through massive — and exploding — data volumes. Moreover, corporate counsel must now understand how technology can be used to mitigate those risks. And now more than ever, corporate counsel have to understand the effect these changes are having on the legal services supply chain, so they can choose intelligently among the wide range of service providers and solutions in this space.
Has this technological revolution led to a closer relationship between CIOs and general counsel in regards to managing costs and minimizing risk around big data?
The technological revolution, and indeed the big data revolution that is under way, is really forcing the CIO and general counsel to work together in ways in which they may not have worked together in the past. Historically, general counsel and CIOs didn’t have a prevailing need to speak on a regular basis, but in this new environment, it is no longer the case that either office can operate independently of one another. Today, the general counsel and the CIO, as well as potentially the CFO and business unit leaders, all have to work together and blend their responsibilities to manage information risk, manage costs, and adopt intelligent solutions to address the major risks and costs that information and legal requirements have now presented.
What is a data blueprint and why is it so important to create one?
A data blueprint serves dual purposes. First, in simple terms, the data blueprint is really a snapshot or an inventory of an organization’s data, storage environments, server architecture, and the general layout of where corporate data is generated and stored. The second purpose is that it provides the corporation with a dynamic, “living” document that can be added to and edited, on a moving-forward basis, as the data and hardware architecture of an organization changes over time.
Given the changes in the Federal Rules of Civil Procedure (FRCP), why is it increasingly important for general counsel to collaborate with IT on the data blueprint?
The amended FRCP explicitly require that corporations attain a full understanding of their data storage environments. One of the best ways to achieve this understanding is through the development of a data blueprint. Even though an actual data blueprint is not explicitly required by the FRCP, the understanding and intelligence that a data blueprint can help corporate counsel develop can be instrumental in early case strategy discussions, including the important “Meet and Confer” conferences required under the amended rules. Thus, today, it remains critically important for counsel to develop this understanding by collaborating with IT because legal personnel cannot do this alone.
What is the return on investment (ROI) from data blueprints for corporations and how do they help organizations respond to litigation or other legal matters in a timely manner?
Making a compelling ROI story for data blueprints used to be pretty tricky, because the data blueprint was often viewed as a purely “proactive” measure, not necessarily motivated by legal or risk imperatives. But the ROI story for data blueprints is becoming easier to make, especially in today’s environment where it seems that a fully developed data blueprint actually makes it easier for corporations to undertake discovery. Moreover, with a data blueprint, organizations are better positioned to fend off what can be costly disputes over the spoliation of evidence or the presence of other sanction-worthy activity in the e-discovery process.
What are some of the legal issues surrounding the e-discovery process? How do you build defensible e-discovery processes and how are these challenged if built improperly?
In my opinion, the fundamental legal issue at the core of e-discovery is that organizations must immediately be intelligent about data preservation. As the critical first step that any organization must take in any e-discovery matter, the data preservation stage requires organizations intelligently and quickly to preserve all data that falls within the scope of the episodic legal event at hand, whether it is a lawsuit, a government investigation, or an internal investigation. These obligations are quite literally set out in procedural rules, at the state and federal levels. In this new environment, we have seen that the data preservation stage is where many of the e-discovery fights ensue, because without a repeatable, defensible preservation effort, organizations can find themselves exposed to substantial strategic risk.
That is not to suggest, however, that getting data preservation “right” is difficult or expensive. In my view, organizations can take fundamental steps towards achieving “litigation readiness” and defensible e-discovery practices through the development of intelligent, repeatable, and defensible litigation hold procedures and processes. It is with these mechanisms that organizations can elegantly handle an episodic legal event by properly deploying resources across business units, IT, legal, and even sometimes the CFO’s office to preserve data and prepare for the e-discovery process.
And, finally, it bears addressing the question, what is the human element in e-discovery? I always tell clients that although we can talk about bits and bytes all day long, at the end of the day e-discovery is a people business; the crucial analysis always comes down to the central question of “What did the organization do to handle these new and unique data preservation responsibilities?” Distilled to the core question, I have concluded, it is all about the subjective judgment of individuals and leaders within organizations to spot risk and develop internal awareness, both for their data preservation responsibilities and as well for managing the potentially huge costs of e-discovery. Proper e-discovery readiness leads to e-discovery awareness and effective cost savings. Yet these measures can only be effectively implemented when organizations have identified stakeholders in the process beyond the legal department, including business units, records management, and IT. Finally, organizations are always better off when they educate end users about the importance of proper information management, both before and during legal events.
Predictive coding is also in the news regarding e-discovery. What is your expert opinion about the defensibility of predictive coding?
Predictive coding has been one of the most audible buzzwords in this space lately; there have been compelling arguments as to its use, especially given the exploding data volumes and the need for some automation in coding documents. That being said, I still have not observed a scenario in which a team of lawyers prosecuting or defending a case would agree to work with documents selected solely by a computer employing a predictive coding solution. This type of “black box” solution simply hasn’t taken hold — as a single, stand-alone solution — for obvious reasons. Lawyering is a subjective practice. It requires an exercise in judgment and it calls for the creative building of arguments for and against a case. I don’t think trial lawyers are lining up to try their cases using binders of documents selected solely by a computer. And I have yet to meet a team of lawyers comfortable with going forward with any legal proceeding — be it a deposition, negotiation or a trial — without actually reading and understanding the core documents central to their case.
That being said, I am a huge proponent of technology-assisted document review. We have had technology-assisted document review for years because we need it. Search terms, for instance, are by nature “computer assisted,” but still, lawyers read and select the documents central to their case. To that end, predictive coding is not such a novel concept; it is just the next iteration of technology enabling lawyers to get to their most important documents with less effort. But in my view, pure-play predictive coding will fall somewhere short of proving to be the silver bullet some of its most audible proponents in the vendor space tout it to be.
Finally, I would suggest that a powerful use of predictive coding would be to leverage it in a way that lawyers can presumptively eliminate (or de-prioritize) obviously non-relevant materials from a data set. This would streamline the data analytics and review portion of the process, and it would further focus lawyer efforts by giving them a more “potent” set of documents as their starting point.
What future changes in technology should general counsel expect to see?
We’re going to continue to see the industry working to address the profound impact of data and technology on the legal practice. As I said earlier, in-house counsel are no longer in a purely reactive mode. Nor can they be, because of the massive costs and risks present in the e-discovery process. As a result, the legal services supply chain is fundamentally transforming from a top-heavy, law-firm-centric one to one where law firms — rightly in their spot at the high end of the supply chain, delivering the highest caliber of legal services — are increasingly relying on technology partners and other service providers further down the chain to help them preserve, collect, and ultimately identify relevant documents in the e-discovery process. Altogether, this transformation of legal services delivery will continue to drive the industry evolution toward a truly multidisciplinary approach to e-discovery.
Corporate legal departments will continue to benefit as they exploit the array of services in today’s diverse legal services supply chain. By adopting blended solutions, legal counsel will continue to improve cost efficiencies, drive and sustain quality, and reduce risk.
Peter Gronvall, Managing Director of Huron Legal, is a nationally recognized expert in information risk management and electronic discovery. His practice focuses on providing strategic solutions to law firms, corporations, and the investor community on information risk management and electronic discovery issues. Peter leverages leading technology and software platforms for information management and e-discovery engagements, with particular focus on delivering cost-effective and defensive solutions in data management, preservation, collection, analytics, review, processing, and production.
Peter is also an adjunct professor of law at Georgetown University Law Center in Washington, D.C., where he teaches an advanced civil procedure and e-discovery seminar.
Prior to joining Huron, Peter was Co-Founder and Managing Partner of AdamsGrayson, a market-leading consultancy that focused on information risk management and e-discovery consulting. AdamsGrayson joined Huron Legal in July 2012, when the company was acquired by Huron Consulting Group. Prior to founding AdamsGrayson, Peter practiced as a corporate lawyer; he developed the core of his expertise at a preeminent Wall Street law firm.
Peter earned his J.D. at Yale Law School in New Haven, Connecticut, and a B.A., summa cum laude, from the University of Minnesota in Minneapolis.
Lauren Everhart is a director at Argyle Executive Forum. In this role, Lauren manages and leads client experience and client service delivery for Argyle’s content and event partners. She also manages the content development, editorial speaker recruitment, and execution of a number of Argyle’s annual business events. Lauren has been with Argyle Executive Forum since 2008. She holds a B.A. from the State University of New York at Albany and a J.D. from New York Law School.