Quick Tips on Reducing the Biggest Cost in E-Discovery: Legal Review
If you were to calculate how much your company spent on e-discovery for every electronic document as it went through the whole process, from collection through to production, could you do it? Not many companies can, nor do most legal and IT staff realize that up to 80% of the entire cost of e-discovery is spent on legal review. In fact, recent estimates indicate that corporations are spending between $2.70 and $4 per email on legal review.1
Legal review, quite simply, is the process of lawyers reviewing each collected document to determine whether it is relevant to the case. Sounds simple enough, but consider that these lawyers are often charging $300 an hour or more, and the corpus of documents for business litigation, regulatory response and investigations often totals in the thousands, or millions. For instance, in the Enron case alone, investigators seized more than 12 million documents, which, if printed out, would be three times taller than the Sears Tower.
On top of the cost and size issue, it’s often necessary to collect and review these documents in a very short amount of time. Whether it’s to assess the strength or breadth of the data before a meet and confer meeting between opposing counsel, or to comply with a "street sweep" that regulatory agencies often conduct with similar Wall Street firms after finding an infraction with one company, it’s in a company’s best interest to understand and act upon the collected data as quickly as possible.
It’s for this reason that corporations that want to get serious about reducing the cost and risk of e-discovery are closely examining how they can improve the legal review process. But how can this be achieved with maximum efficiency and minimal business disruption? Here are some basic considerations that any legal and IT department should weigh in developing a repeatable and cost-effective e-discovery process:
1. Reduce the amount of data to be reviewed. A simple and often overlooked piece of e-discovery is known as "processing," when data is prepared for legal review. Processing is also where duplicates are removed and techniques such as near-deduplication and other culling takes place. Effective processing can significantly reduce the amount of data that needs to be reviewed (typical numbers range from 50%-80% reduction).
2. Consider bringing a review tool in-house. Your law firm and service providers are likely already using a review tool, but even if you don’t plan to handle the reviews in-house, there are many benefits to bringing a review tool in-house. First, a review tool often comes with processing capabilities so that even if the review is conducted by a law firm or service provider, you’ve already eliminated all of the duplicates and have the ability to eliminate the non-relevant emails ("donuts in the kitchen" e.g.). Secondly, having a tool in-house allows corporations to get a sense of what the data contains earlier in the process. This technique, commonly called an "early case assessment," enables legal teams to determine case strategy earlier in the process and find potential "smoking gun" emails before court proceedings begin. Thirdly, there are a number of use cases such as internal investigations or regulatory requests when it makes more economic sense to handle the matter in-house.
3. Examine your outsourcing options. This step isn’t contradictory to point number two, and in fact, many corporations are finding a cost-effective and efficient balance of internal resources and outsourced services to handle ongoing e-discovery matters.
As companies take more control of the e-discovery process, the cost of review can be reduced dramatically. There are qualified lawyers and legal service provider organizations doing document review on a contract basis for substantially less. Contract attorneys can be hired directly by the corporation, or it can require its firm to do so. There are also firms and companies that specialize in large document reviews, which should be kept under consideration if the company faces large-scale litigation and needs to "scale up" quickly. Corporations that still use associates for review can make these modest changes and immediately realize substantial savings. While these steps won’t make legal review a cheap process, it will substantially reduce the cost associated with legal review. In addition, it will provide legal and IT teams better insight to their corporate data and more time to develop case strategy.
1. "Control Costs of Electronic Discovery" by Stephanie Mendelsohn and Liz Bachman-Greci, both of Reed Smith, as published in E-Discovery Advisor Magazine, issue 5, page 12.