Traditionally parties involved in litigation document discovery have focused on paper documents. To a certain extent this continues to be the case. However, given reports suggesting that 93% of business records are created electronically, with 70% never being converted to hardcopy at all, limiting document discovery to paper documents is no longer feasible in most cases. Indeed, in accordance with recent court decisions and guidelines, parties are increasingly required to preserve, review and produce electronically stored information. However, unless they, and their lawyers, work together to develop an efficient electronic discovery plan, the costs – both financial and organizational – can be significant.
WHAT IS "ELECTRONIC DISCOVERY "?
Subject to some exceptions, parties to litigation must disclose to each other all documents in their possession, power or control that may in any way relate to the litigation. "Electronic discovery" refers to the disclosure of electronically-stored information as part of this process. Courts have consistently held that electronic documents are "documents" and must be produced during this process, even if hardcopy versions of the document are also produced.
ARE ELECTRONIC DOCUMENTS REALY DIFERENT FROM PAPER DOCUMENTS?
As has been observed by the Sedona Conference Working Group on Best Practices for Electronic Document Retention and Production, electronic documents differ from paper documents in at least six major ways (see The Sedona Principles: Best Practices Recommendations and Principles for Addressing Electronic Document Discovery (The Sedona Conference Working Group Series)).
- Volume and Duplicability – Electronic documents typically require less personal and corporate effort to create. Anyone can create and send an email, and can easily send copies to numerous individuals, who may in turn forward the document to others. Electronic documents are frequently more voluminous than their paper counterparts, and duplicates are found in numerous locations.
- Persistence – Paper can be shredded, but it is difficult to completely destroy electronic documents. It is well known that simply deleting a document does not necessarily erase it or prevent third parties accessing it.
- Dynamic content – Electronic documents are not static: they may be automatically updated and reorganized. In some respects they are altered simply by being accessed.
- Metadata – The content of a paper document is easy to discern: it is found within the four corners of the document. Electronic documents, though, contain "metadata", hidden information regarding the document (such as the dates the document was created, modified and received, and by whom, hidden text, comments, annotations, tracked changes, hidden columns in a table, deleted information, etc.). It has been reported that an ordinary email contains over 1,000 elements of metadata.
- Environmental dependence – Electronic documents are "environmentallydependent". Certain software or other systems may be required to access all of the information in them. Taking an electronic document out of its native format (such as converting electronic documents to TIFF, HTML or some other imaged format) inevitably changes the nature of the information produced.
- Dispersion and searchability – Electronic documents are dispersed throughout an organization, like paper documents. But they can be found in many more locations, such as internal and external enterprise servers, hard drives, laptops, internal and external backup tapes and archive systems, intranet and Internet servers, PDAs, eFAXes, home computers, cell phones, voicemail servers, and removable and portable media (zip drives). They can also be yielded by voicemail records, webmail and web-based file storage files, temporary files, such as internet history logs, internet temporary and "cookie" files, instant messaging logs and history files, and auto-recovery files. An organization may have to disclose documents located on devices owned by itself, individuals or third parties.
WHAT CAN YOU DO TO EASE THE BURDEN OF ELECTRONIC DISCOVERY?
Certain issues are repeatedly encountered in the electronic discovery process. It is important for organizations to recognize these issues and, with their lawyers, actively deal with them. Doing so can help ease the burden electronic discovery may otherwise impose on their financial and other resources.
Take Steps to Understand Your Retention and Destruction Policies – Organizations typically retain electronic documents for either too long or not long enough. Although most organizations of any size have document retention protocols setting out how long documents should be maintained before being destroyed, practical compliance with those policies is uneven. The consistent maintenance and preservation of electronic documents is particularly difficult because they can be easily stored out of sight and their handling is frequently dismissed as a "technical issue". It is not uncommon to find that organizations have maintained backups of systems no longer in operation or documents that are redundant (such as daily back-up tapes). It is important to develop a detailed understanding of your organization’s policies before litigation hits.
- Take Steps to Understand Your Information Management Systems – The first few days after litigation becomes a distinct possibility is not the time to begin to understand your organization’s information management systems either. Organizations and their lawyers should understand the architecture of their systems, as well as those of third party service-providers to which their management has been outsourced. When litigation does become a reasonable prospect, the preservation obligations imposed on a party involved in litigation, set out below, should be discussed with relevant information technology staff.
- Take Steps to Understand and Act Promptly Upon Your Preservation Obligations – When litigation is in reasonable prospect, it is important to ensure that general document destruction practices – according to policy or otherwise – are reviewed and, where appropriate, suspended (a "litigation hold"). A litigation hold should extend to all categories of electronic documents relating to issues in the contemplated litigation, and be tied to the records of the key players. Notices should be sent to the personnel likely to hold potentially relevant documents, setting out precisely what must be preserved and emphasizing the gravity of the preservation obligation.
In particular, organizations and their lawyers, with the assistance of third party service-providers if appropriate, must develop strategies to ensure that potentially relevant electronic documents are not destroyed, deleted or modified, including by packing, compressing, purging, disposing of files or parts of files, or through automatic overwriting. All records that describe policies on document retention, back-up, archiving and destruction should be preserved.
The obligation to implement a "litigation hold" when litigation is in reasonable prospect underscores the importance of ensuring that appropriate document retention and destruction policies are already in place, and are followed in practice. No organization wants to be required to preserve huge amounts of electronic documents that should have been discarded years ago, and then required to extend that preservation period for the life of litigation.
Although Canadian courts have, so far, not been inclined to draw adverse inferences or impose costs sanctions when electronic documents have not been preserved, United States courts have adopted a very strict approach, in which significant damages have been imposed when important electronic information has been lost. There are indications this approach may soon take root in Canada.
- Participate Actively in Early Discussions With Opposing Parties and Counsel – In traditional paper-based litigation, parties could spend months in their separate corners, collecting and reviewing their own documents for production. With electronic discovery it is crucial that there be more communication at an early stage of the litigation.
You should be prepared to participate actively with your lawyers in meetings and discussions with the other party to ensure that everyone has a common understanding of their obligations to produce electronic documents and, hopefully, to come to some agreements about what is not required to be preserved and produced, and about an acceptable method for collecting and reviewing the remainder (such as by using agreed search terms). It is also important that organizations, which have hopefully taken the time to understand their own information management systems, explain potential difficulties and efficiencies to the lawyers involved.
- Retain External Service-Providers Where Appropriate – It is generally ideal, when the circumstances of the case justify it, to retain a third party serviceprovider to participate in the electronic discovery process, if only to electronically sift the active responsive documents, remove duplicates and perform related services. Where parties are involved in repeated litigation, it may be most efficient to develop a working relationship with one service-provider, who can become knowledgeable about your information management systems, rather than having to educate a new service-provider for each case.
THE TASK IS MANAGEABLE
Your electronic documents must be disclosed in litigation. Electronic documents are significantly different from paper documents, and their disclosure raises different concerns. However, if you take the time now to understand your information management systems and document retention and destruction policies, and to work with your lawyers to ensure your relevant electronic documents are preserved in the event of litigation and to manage the electronic discovery process, you can minimize the burdens of complying with your legal obligations.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.