The majority of companies report that Law Department e-Discovery operations are still in the adolescence stage of maturity.
To supplement our annual Law Department Survey, we’ve initiated quarterly Flash Surveys on hot topics across key areas of the legal market. Our first Flash Survey identified trends in law department e-Discovery operations and focused on 2015 planning around staffing, spending and technology. Below is a summary of some of the key findings and take-aways from our full E-Discovery Flash Survey Report.
Litigation spending on outside counsel fees has increased significantly year over year and measures to reduce costs remain a priority for most corporations. With outside counsel’s fees accounting for as much as 70% of discovery costs, it’s no surprise that the focus on e-Discovery remains a priority. Our survey revealed that while over half of the companies report having less mature e-Discovery programs, 2015 will find them working with existing staff and technology tools to drive efficiency in an effort to reduce costs.
Despite e-Discovery being a corporate imperative for well over a decade, the majority of companies surveyed indicate that internal operations are either under developed or in the initial stages of developing. The pendulum between building in-house e-Discovery capabilities and outsourcing e-Discovery services has swung back and forth over the past decade. The answer can be found in a hybrid model. The appropriate composition of the hybrid model is dependent upon the delineation of services to be performed in-house and the volume of the work to be performed.
Survey responses indicate that the planned changes in staffing align with the respondent’s current state of maturity. Companies with under developed or developing operations intend to add staff while those with mature programs report that staffing will remain static.
Unlike other corporate functions, e-Discovery requires the coordinated efforts of internal resources, corporate information technology, business unit personnel, outside counsel and other service providers. Evolving case law, proposed revisions to the discovery rules in the Federal Rules of Civil Procedure and technology advances necessitate that a corporate e-Discovery program be comprised of a multi-faceted team with expertise in the legal requirements of e-Discovery, project and vendor management and technical skills. This is not an area that draws upon a singular expertise.
E-Discovery spending will continue to be a strong area of focus in 2015. Spending on outside counsel fees for litigation has increased nationally, while all other areas realized a reduction. Litigation remains the area with the most opportunity to introduce measures to control costs. Not surprisingly, 77% of the participants in our survey indicated that e-Discovery is a priority for 2105, which roughly aligns with the percentage of companies with programs in the initial stages of developing.
While many have in-house tools, there is a lot of focus on revisiting current technologies to improve. Technology should be selected to support and enable a strategy to ensure a defensible process at each stage while reducing costs.
A common misconception is that e-Discovery is a singular step when in reality it’s an aggregate of multiple processes. Each process is supported by differing technologies requiring defined procedures and documented controls to position the company to defend its methods should the need arise. A single technology tool to support the complete e-Discovery workflow simply does not exist. A technology toolkit needs to consist of software to enable the processes for: legal hold/preservation, collection, processing, analytics, review and production. Consideration must be given to whether the tools are implemented within the corporate environment, in a SaaS or cloud-based model or provided via third-party service. Additionally, project management, audit tracking, reporting and the ability to generate metrics, need to factor into the requirements for an e-Discovery toolkit. Typically, companies initially invest in a technology to support the preservation and collection of electronic discovery as it’s the initiation stage of the process and within the domain of the corporation to access the data. However, the greatest opportunity to decrease costs is to focus on reducing the population of documents to be reviewed as 73% of the costs are directly related to document review.
It’s evident that e-Discovery is not a static corporate requirement. The area will continue to increase in complexity as new technologies and data types become subject to inclusion in litigation and investigations (e.g., BYOD (Bring Your Own Device), wearable technology, cloud-based data, GPS data, etc.). Further, the proposed revisions to the discovery rules in the Federal Rules of Civil Procedure, privacy requirements and the ever-growing collection of case law creates a shifting landscape to navigate. Companies that invest in developing or evolving an e-Discovery Program will be best prepared to handle the shifting requirements.
For more information on e-Discovery trends, read “HBR’s Ten Take-Aways from Georgetown Law’s Advanced eDiscovery Institute.”
 HBR Consulting 2014 Law Department Survey, November 2014