Kroll Study Sees Dramatic Drop in E-Discovery Sanctions

Sue Reisinger

Corporate Counsel

12-06-2012

Some good e-news for corporate attorneys this week — in-house and outside counsel seem to be learning their e-discovery lessons, according to the latest Kroll Ontrack annual report on electronic discovery cases.

The learning curve is evident because the percent of prominent cases that imposed sanctions on parties, which had been on the rise, actually declined a whopping 10 percent in 2012, according to Kroll. The number was 42 percent last year, compared with 32 this year.

Why the dramatic drop? "I think because parties are being more collaborative, following guidelines, implementing new technology, and working to get ahead of e-discovery issues sooner," suggested attorney Michele Lange, director of e-discovery thought leadership and industry relations at Kroll. The company provides e-discovery and other information services to companies.

"Most of the sanction cases we saw in 2012 came from corporations struggling to keep up with data. That means that these cases had large volumes of data, and mistakes were made," Lange said.

But not all categories saw declines. The survey, which used a non-scientific sampling of 70 major cases, found that the number of procedural disputes more than doubled over last year's figures. Kroll considers procedural issues to include such things as search protocols, party cooperation, production, and privilege concerns.

(Summaries of the 70 prominent cases examined by Kroll can be found on their website.)

"The increase shows courts are getting their arms around the procedural issues," Lange suggested. "Typically, judges have shied away from wanting to talk about it, but now courts are getting down in the mud."

But the most interesting e-discovery trend this year was what Lange calls technology-assisted review of data, or TAR. It's a kind of predictive coding or "smart" technology that conducts document reviews faster and more efficiently.

"We've seen in our personal lives how Amazon.com, for example, gets very smart very quickly about your purchasing habits," Lange explained. "Well, now they are applying that same smart technology to legal document review to more quickly decide what types of documents are responsive."

Lange said the problem in the past was there was so little case law that lawyers didn't feel comfortable taking such shortcuts. "It's still so much in its infancy that there's not even an agreed-upon term in the industry for it," she said.

She noted that Kroll saw five major cases where judges accepted TAR in 2012. "And 2013 is probably the year that TAR will become mainstream."

Lange sees some valuable lessons for in-house counsel in this year's report. "The number one lesson is that e-discovery is a standard practice now, and your law firms and your judges are very savvy. As a corporation you need to be savvy too, or you will have problems in 2013."

Lange, who's been handling the survey for over a decade, remembers how "naïve, almost childish and unsophisticated" the e-discovery discussions were 10 years ago. "We'd have great debates over whether parties should produce metadata," she said. "Today if parties didn't produce it — well, that just wouldn't happen today." (Metadata is a techie term applied to data that supplies underlying information about the actual data under review, such as the means, time, and date of creation.)

She explained that 10 years ago "we thought the volumes of data were big. But today they are enormous. We didn't even fathom issues about social media, text messaging, and Twitter then. Or about bringing your own computer to work."

What does Lange predict the e-discovery landscape will look like 10 years from now? For one thing, the tools and technology will keep evolving "at the speed of light," she said.

"Ten years ago, e-discovery was the absolute wild west," she said. "Today, we are in the early days of realizing that there are tools that can help us. Ten years from now, I'm hoping that it will move into stabilization with standard processes and technologies that we haven't even thought of today."