Monthly Archives: July 2016

Highlights from the NorCal eDiscovery & IG Retreat 2016

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The 2016 NorCal Retreat was held at the Ritz-Carlton at Half Moon Bay, marking the fifth anniversarynorcal2016_cliffs of the Ing3nious retreat series (originally under the name Carmel Valley eDiscovery Retreats).  As always, the location was beautiful and the talks were informative.  Two of the speakers had books available: Christopher Surdak’s Jerk: Twelve Steps to Rule the World and Michael Quartararo’s Project Management in Electronic Discovery: An Introduction to Core Principles of Legal Project Management and Leadership In eDiscovery.  My notes below provide some highlights from the sessions I was able to attend (there were two simultaneous sessions most of the day).  You can find more photos here.

The Changes, Opportunities and Challenges of the Next Four Years
The keynote by Christopher Surdak covered topics from his new book, Jerk (jerk is the rate of change of acceleration, i.e., the third derivative of position with respect to time).  After surveying the audience and finding there was nobody in the room that didn’t have a smartphone, he listed the six challenges of the new normal: quality (consumers expect perfection), ubiquity (anything anywhere anytime), immediacy (there’s an app for that, instantly), disengagement (people buy the result–they don’t care where it came from), intimacy (customers want connectedness and sense of community), and purpose (support customers’ need to feel a sense of purpose, like paying a high price to be “green”).  He then described the four Trinities of Power that we’ve gone through over history: tools, dirt (land), analog (capital), and digital (information).  Information is now taking over from capital–the largest companies are Apple, Google, and Microsoft.  Much of the global economy is experiencing negative interest rates–the power of capital is going away.  He then described the twelve behaviors of Jerks, the disruptive companies that come out of nowhere and take off:

  1. Use other people’s capital – Airbnb uses your home; Uber uses your car
  2. Replace capital with information – Amazon is spending money to create retail stores to learn why you go there.
  3. Focus on context, not content
  4. Eliminate friction
  5. Create value webs, not value chains – supply chains slow you down when you have to wait for a step to complete.  What someone values will change tomorrow, so don’t get locked into a contract/process.
  6. Invert economies of scale and scope – concierge healthcare and doctor on demand are responses to unsatisfying healthcare system
  7. Sell with and through, not to
  8. Print your own money – Hilton points, etc.
  9. Flout the rules – rules are about controlling capital. Fan Duel (fantasy sports) refuses cease and desist because there is more money in continuing to operate even after legal costs.  Tesla sells directly (no dealerships).   Uber has a non-compliance department (not sure if he meant that literally).
  10. Hightail it – people with unmet needs (tail of distribution) are willing to norcal2016_keynotepay the most
  11. Do then learn, not learn then do – learning first is driven by not wanting to waste capital
  12. Look forward, not back – business intelligence is about looking back (where is my capital?)

Dubai is legally obligating its government to open data to everyone.  They want to become the central data clearinghouse.  You can become an e-resident of Dubai (no reporting back to the U.S. government).

How About Some Truly Defensible QC in eDiscovery? Applying Statistical Sampling to Corporate eDiscovery Processes
I was on this panel, so I didn’t take notes.

Analytics & eDiscovery: Employing Analytics for Better, More Efficient, and Cost-Effective eDiscovery
I wasn’t able to attend this one.

Can DO-IT-YOURSELF eDiscovery Actually Deliver?
This was a software demo by Ipro.  Automation that reduces human touching of data improves quality and speed.  They will be adding ECA over the next month.

Behind the eDiscovery Ethics Wheel: Cool, Calm, and Competent
I wasn’t able to attend this one.

“Shift Left”: A New Age of eDiscovery – Analytics and ECA
I wasn’t able to attend this one.

When the Government Comes Knocking; Effective eDiscovery Management During Federal Investigations
Talk to custodians–they can provide useful input to the TAR process or help you learn what relevant documents are expected to look like.  Do keyword search over all emails and use relevant documents found to identify important custodians.  Strategy is determined by time frame, volume, and budget.  Don’t tell the government how you did the production–more details tends to lead to more complications.  Expectations depend on the agency.  Sophistication varies among state AGs.  Different prosecutors/regions have different expectations and differing trust.  The attorney should talk to technologists about documenting the process to avoid scrutiny later on.  Having good processes lined up early demonstrates that you are on top of things.  Be prepared to explain what body of data you plan to search.  Only disclose details if it is necessary for trust.  Describe results rather than methods.  The FTC, DOJ, and SEC will ask up front if you are using keywords or predictive coding.  If you use keywords, they will require disclosure of of the words.  When dealing with proprietary databases, negotiate to produce only a small subset.  Government uses generic template requests–negotiate to reduce effort in responding.  In-place holds can over-preserver email (can’t delete email about kids’ soccer practice).  Be aware of privacy laws when dealing with international data.

The Next Generation of Litigation Technology: Looking Beyond eDiscovery
I wasn’t able to attend this one.

Top Trends in Discovery for 2016
Gartner says 50% of employers will require employees to BYOD by 2017.  Very few in the audience had signed a BYOD policy.  Very few had had a litigation hold on their personal phones.  Text messages are often included in a discovery request, but it is burdensome to collect them.  Wickr is a text messaging app that encrypts data in transit and the message self-destructs (much more secure than Snapchat).  BYOD policy should address security (what is permitted, what must be password protected, what to do if lost or stolen–remote wipe won’t be possible if you have the carrier disable the phone), ban jailbreaking, what happens when the employee leaves the company, prohibitions on saving data to the cloud, and they should require iOS users to enable “find my phone.”  Another trend is the change to rule 37(e).  There is now a higher bar to get sanctions for failure to preserve.  If an employee won’t turn over data, you can fire them but that won’t help in satisfying the requesting party.  It is too soon to tell if the changes to the FRCP will really change things.  With such large data volumes, law firms are starting to cooperate (e.g., telling producing party when they produced something they shouldn’t have).  Cybersecurity is another trend.  Small service providers may not be able to afford cybersecurity audits.  The final trend is the EU/US privacy shield.  The new agreement will go back to the courts since the U.S. is still doing mass surveillance.  Model contract clauses are not the way to go, either (being challenged in Ireland).

Through the Looking Glass: On the Other Side of the FRCP Amendments
I wasn’t able to attend this one.

norcal2016_receptionBest Practices for eDiscovery in Patent Litigation
For preservation, you should know which products and engineers are involved.  It is wise to over-preserve.  You may collect less than you preserve. There is more data in patent litigation.  Ask about notebooks (scientists like paper).  Also, look for prototypes shown at trade shows, user manuals, testing documents, and customer communications.  Tech support logs/tickets may show inducement of infringement.  Be aware of relevant accounting data.  50-60% of new filings are from NPEs (non-practicing entities), so asymmetric.  In 2015 the cost of ediscovery was $200k to $1 million for a $1 million patent case.  In the rule 26(f) meeting, you should set the agenda to control costs.  Get agreement about what to collect in writing.  Don’t trust the person suing you to not use your confidential info–mark as “for attorney’s eyes only,” require encryption and an access log.  It is difficult to educate a judge about your product.  Proportionality will only change if courts start looking at the product earlier.

Everything is the Same/Nothing Has Changed
What has really changed in the FRCP?  Changes to 26(b)(1) clarify, but proportionality is not really new.  The changes did send a message to take proportionality and limiting of discovery seriously.  The “reasonably calculated to lead to the discovery of admissible evidence” part was removed.  The judiciary should have more involvement to push proportionality.  The responding party has a better basis to say “no.”  NPEs push for broad discovery to get a settlement.  There is now more premium on being armed and prepared for the meet and confer.  Need to be persuasive–simply saying “it is burdensom” is not enough–you need to explain why (no boilerplate).  Offer an altnorcal2016_golfernative (e.g., fewer custodians).  One panelist said it was too early to say if proportionality has improved, but another said there has been a sea change already (limiting discovery to fewer custodians).  The lack of adoption of TAR is not due to the rules–the normal starting point for negotiation is keywords.  Proportionality may reduce the use of predictive coding because we are looking at fewer custodians/documents.

It’s a Social World After All
I wasn’t able to attend this one.

The day ended with an outdoor reception.

Highlights from the Masters Conference in NYC 2016

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The 2016 Masters Conference in NYC was a one-day e-discovery conference held at the New Yorker.  There were two simultaneous sessions throughout the day, so I couldn’t attend everything.  Here are my notes:MastersNYC2016_lunch

Faster, Better, Cheaper: How Automation is Revolutionizing eDiscovery
I was on this panel, so I didn’t take notes.

Five Forces Changing Corporate eDiscovery
68% of corporations are using some type of SaaS/cloud service.  Employees want to use things like Dropbox and Slack, but it is a challenge to deal with them in ediscovery–the legal department is often the roadblock to the cloud.  Consumer products don’t have compliance built-in.  Ask the vendor for corporate references to check on ediscovery issues.  72% of corporations have concerns about the security of distributing ediscovery data to law firms and vendors.  80% rarely or never audit the technical competence of law firms and vendors (the panel members were surprised by this).  Audits need to be refreshed from time to time.  Corporate data disposition is the next frontier due to changes in the Federal Rules and cybersecurity concerns.  Keeping old data will cause problems later if there is a lawsuit or the company is hacked. Need to make sure all copies are deleted.  96% of corporations use metrics and reporting on their legal departments.  Only 28% think they have enough insight into the discovery process of outside counsel (the panel members were surprised by this since they collaborate heavily with outside counsel).  What is tracked:

65% Data Managed
57% eDiscovery Spend
52% eDiscovery Spend per GB
48% Review Staffing
48% Total Review Spend
39% Technologies Used
30% Review Efficiency

28% of the litigation budget is dedicated to ediscovery. 44% of litigation strategies are affected by ediscovery costs.  92% would use analytics more often if cost was not an issue.  The panelists did not like extra per-GB fees for analytics–they prefer an all-inclusive price (sidenote: If you assume the vendor is collecting money from you somehow in order to pay for development of analytics software, including analytics in the all-inclusive price makes the price higher than it would need to be if analytics were excluded, so your non-analytics cases are subsidizing the cases where analytics are used).

Benefits and Challenges in Creating an Information Governance (IG) Program
I couldn’t attend this one.

Connected Digital Discovery: Can We Get There?
There is an increasing push for BYOD, but 48% of BYOD employees disable security.  Digital investigation, unlike ediscovery, involves “silent holds” where documents are collected without employee awareness.  When investigating an executive, must also investigate or do a hold on the executive’s assistant.  The info security department has a different tool stack than ediscovery (e.g., network monitoring tools), so it can be useful to talk to them.

How to Handle Cross-Border Data Transfers in the Aftermath of the Schrems Case
I couldn’t attend this one.

TAR in litigation and government investigation: Possible Uses and Problems
Tracy Greer said the DOJ wants to know the TAR process used.  Surprisingly, it is often found to deviate from the vendor’s recommended best practices.  They also require disclosure of a random sample (less than 5,000 documents) from the documents that were predicted to be non-relevant (referred to as the “null set” in the talk, though I hate that name).  Short of finding a confession of a felony, they wouldn’t use the documents from the sample against the company–they use the sample to identify problems as early as possible (e.g., misunderstandings about what must be turned over) and really want people to feel that disclosing the sample is safe.  Documents from second requests are not subject to FOIA.  They are surprised that more people don’t seem to do email domain filtering.  Doing keyword search well (sampling and constructing good queries) is hard.  TAR is not always useful.  For example, when looking for price fixing of ebooks by Apple and publishers it is more useful to analyze volume of communications.  TAR is also not useful for analyzing database systems like Peoplesoft and payroll systems.  Recommendations:

Keyword search before TAR No
Initial review by SME Yes
Initial review by large team No
De-dupe first Yes
Consolidate threads No

The “overturn rate” is the rate at which another reviewer disagrees with the relevance determination of the initial reviewer. A high overturn rate could signal a problem. The overturn rate is expected to decrease over time. The DOJ expects the overturn rate to be reported, which puts the producing party on notice that they must monitor quality. The DOJ doesn’t have a specific recall expectation–they ask that sampling be done and may accept a a smaller recall if it makes sense.  Judge Hedges speculated that TAR will be challenged someday and it will be expensive.

The Internet of Things (IoT) Creates a Thousand Points of (Evidentiary) Light.  Can You See It?
I couldn’t attend this one.

The Social Media (R)Evolution: How Social Media Content Impacts e-Discovery Risks and Costs
Social media is another avenue of attack by hackers.  They can hijack an account and use it to send harmful links to contacts.  Hackers like to attack law firms doing M&A due to the information they have.  Once hacked, reliability of all data is now in question–it may have been altered.  Don’t allow employees to install software or apps.  Making threats on social media, even in jest, can bring the FBI to your doorstep in hours, and they won’t just talk to you–they’ll talk to your boss and others.

From Case Management to Case Intelligence: Surfacing Legal Business IntelligenceMastersNYC2016_panel
I couldn’t attend this one.

Early Returns from the Federal Rules of Civil Procedure Changes
New rule 26(b)(1) removes “reasonably calculated to lead to the discovery of admissible evidence.”  Information must be relevant to be discoverable.  Should no longer be citing Oppenheimer.  Courts are still quoting the removed language.  Courts have picked up on the “proportional to the needs of the case” change.  Judge Scheindlin said she was concerned there would be a lot of motion practice and a weakening of discovery with the new rules, but so far the courts aren’t changing much.  Changes were made to 37(e) because parties were over-preserving.  Sanctions were taken out, though there are penalties if there was an intent to deprive the other party of information.  Otherwise, the cure for loss of ESI may be no greater than necessary to cure prejudice.  Only applies to electronic information that should have been preserved, only applies if there was a failure to take reasonable steps, and only applies if the information cannot be restored/replaced via additional discovery.  What are “reasonable steps,” though?  Rule 1 requires cooperation, but that puts lawyers in an odd position because clients are interested in winning, not justice.  This is not a sanctions rule, but the court can send you back.  Judge Scheindlin said judges are paying attention to this.  Rule 4(m) reduces the number of days to serve a summons from 120 to 90.  16(b)(2) reduces days to issue a scheduling order after defendant is served from 120 to 90, or from 90 to 60 after defendant appears.  26(c)(1)(B) allows the judge to allocate expenses (cost shiftinMastersNYC2016_receptiong).  34(b)(2)(B) and 34(b)(2)(C) require greater specificity when objecting to production (no boilerplate) and the objection must state if responsive material was withheld due to the objection.  The 50 states are not all going along with the changes–they don’t like some parts.

Better eDiscovery: Leveraging Technology to its Fullest
When there are no holds in place, consider what you can get rid of.  Before discarding the discovery set, analyze it to see how many of the documents violated the retention policy–did those documents hurt your case?  TAR can help resolve the case faster.  Use TAR on incoming documents to see trends.  Could use TAR to help with finding privileged documents (thought the panelist admitted not having tried it).  Use TAR to prioritize documents for review even if you plan to review everything.MastersNYC2016_empire_state  Clustering helps with efficiency because all documents of a particular type can be assigned to the same lawyer.  Find gaps in the production early–the judge will be skeptical if you wait for months.  Can use clustering on custodian level to see topics involved.  Analyze email domains.

Vendor Selection: Is Cost the Only Consideration?
I couldn’t attend this one.

The conference ended with a reception at the top of the Marriott.  The conference also promoted a fundraiser for the victims of the shooting in Orlando.