E-Discovery Insights – Clearwell Systems, Inc.

Fulbright Litigation Survey Calls Out Need for More

Proportionality/Rules Changes

by Dean Gonsowskion November 11th, 2010

Fulbright & Jaworski recently issued its “7th Annual Litigation Trends
Survey Report” and there were several interesting trends worth
noting. Not surprisingly, the general pace of litigation is forecast to
increase upwards, relatively unabated, with more than 25% of
respondents expecting their companies’ disputes to increase in the
next 12 months.

Beyond this trend it’s clear that there’s also groundswell of support for
a movement towards more e-discovery proportionality. While also a big topic at Sedona’s
annual conference (and discussed in the recent Moody case), a whopping 79% of US
respondents think the “US Rules of Civil Procedure should be modified in some way to limit e-
discovery in civil cases.” While I haven’t heard of any specific proposals for a rules amendment,
it’s clear that folks aren’t happy with the status quo, particularly with the increasing discovery
burden facing enterprises dealing with unilateral disputes. This discontent is likely tied to the
fact that costs continue to escalate, with the survey indicating that more than 40% of the
largest US companies (over $1B in Revenue) plan to “increase their spending on e-discovery in
the next 12 months.”

Finally, the survey also focused on an area that’s getting an increasing level of scrutiny.
Fulbright asked “when preserving potentially relevant information in litigation or an
investigation, what methods do you use most frequently for preserving electronically stored
information?” Leading the pack, with 55% of vote, was “rely on individual custodians to
identify and preserve their own information.” Custodian based collections have been discussed
recently as being under fire in blogs and other recent cases such as Pension Committee and
Ford Motor Co. v. Edgewood Properties Inc. The notion is that under- or un-supervised collection
methodologies are dangerous because it’s relatively easy to paint the custodians at issue as
either being motivated to hide responsive data or relatively unconcerned with compliance.
Nevertheless, it’s clear that (as of now) custodian-based collections are still somewhat
“reasonable” given that more than 50% of the populous collects data this way.

On the other side of the spectrum from custodian based ESI collections, there are automated
data collection tools and methods that can be considered too. There are undoubtedly
advantages (risk reduction, speed, audit trails, etc.) to using “automated search software” for
the collection of data (like 43% of the respondents did in the Fulbright survey). Yet, it’s clear
this isn’t a zero sum game – meaning there’s currently a place for both methodologies in the
legal landscape. For many organizations it becomes a risk management exercise as summarized
in a recent ARMA article entitled “Is ‘Manual’ Collection of ESI Defensible?”: “Companies may

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E-Discovery Insights – Clearwell Systems, Inc.

choose the manual collection of ESI to reduce costs, particularly if they have limited levels of
litigation or lower risk levels posed by the litigation itself.”

In the end, like so many aspects of electronic discovery, almost any well thought out, well
documented methodology *can* be defensible, but the onus is on the preserving/collecting
party to buttress whatever poison they pick. Defaulting into a method without preparation,
auditing and follow-through is a recipe for disaster.

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