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E-discovery: sifting through the evidence

This article appears in the issue July/August 2014, [Vol 23, Issue 7]
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According to Gartner, the e-discovery software market will grow at a robust 15 percent per year to nearly $3 billion by 2017, driven by the increasing amount of litigation and growth in the amount of content to be searched. In one survey of U.S. corporations, more than half of the respondents reported increases in litigation costs. In another, 71 percent of the companies reported spending more than $1 million on litigation in 2013, up from about 50 percent in 2011 and 2012. E-discovery is the most time-consuming part of litigation and accounts for 50 to 90 percent of litigation costs.

One response to the escalating litigation costs has been for companies to move a portion of the work in-house, particularly the early phases. The stages of e-discovery are often divided into “left side” and “right side” in the electronic discovery reference model (EDRM). The left side includes management of enterprise content, identification of potentially relevant information, preservation (legal hold) and collection of candidate information. Those steps are designed to identify and prepare potentially relevant material for analysis.

The right side includes processing, review, analysis and production. In that phase, attorneys make decisions about what is relevant. The output is a set of material that is presented to opposing counsel as being responsive to the discovery. Because attorneys either within the company or in law firms conduct the review, an important goal is to minimize the amount of material to be reviewed.

In-house or outsource?

Conducting a portion of the e-discovery process in-house allows companies to access the information rapidly, make it searchable and then put a small amount of data on a review tool for early case assessment (ECA). “Most companies need both in-house and outsourced processing,” says Eddie Sheehy, CEO of Nuix. “Doing it all can be counterproductive because it requires ongoing staffing that would not be typical in a non-litigation situation.” Therefore, it makes sense to conduct a portion of the work in-house but to expand to either a law firm or litigation support environment when needed.

Nuix developed a binary-based technology used for indexing and processing information that can extract information from any type of file and scale to an almost unlimited degree. “Our technology is used in the core processing engines of nine of the top 10 e-discovery solutions,” says Sheehy. The Nuix eDiscovery suite is also offered as a solution with its own interface, covering functions such as legal hold, collection and review.

The same Nuix technology that powers its e-discovery solution is used in its cybersecurity application, as well as in the Nuix investigation and governance applications. “The more advanced companies, such as banks or those with security teams, have given IT the responsibility for both e-discovery and cybersecurity,” Sheehy adds, “so by using Nuix, they can reduce the number of different products they have to buy.”

Lawyers and technophobia

Lawyers have not been early adopters of technology, which is surprising since the legal field is a knowledge industry. “The image of mahogany furniture and leather bound books is a powerful one,” notes Dean Gonsowski, associate general counsel and senior director of business development at Recommind. “Tradition plays a strong role in this profession, and computer technology does not necessarily fit in.”

One factor may be demographics. According to the Lawyers Statistical Report published by the American Bar Association, there are 1.2 million licensed lawyers in the United States. Only 19 percent were age 34 or younger in 2000, and the number dropped to 13 percent by 2005 as the baby boomer population continued to age. More recent figures from individual states indicate that more than half the practicing lawyers are over age 50, and therefore did not grow up as “digital natives.”

Despite some degree of reluctance, for the most part the realities of dealing with a volume of information that is unmanageable without technology, and the move to a fixed fee model for pricing, mandate greater efficiencies. “Even the most technophobic lawyers understand that e-discovery has to be automated,” says Gonsowski. “Predictive coding, for example, is undeniably effective, and can save millions of dollars per case, but it has a reputation for being hard to use.”

However, the software has evolved. “Just as big data began with tools designed for data scientists but eventually was adapted for business users, e-discovery analytics tools are becoming more approachable,” Gonsowski says. In the case of Recommind, a new interface has been developed that is in the spirit of an iPad. “It supports our full spectrum of e-discovery functions,” he adds, “but is less complex for the user.”

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