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Almost two out of five executives are still harried by electronic discovery issues more than 18 months after amendments to the Federal Rules of Civil Procedure, governing e-discovery, took effect, according to a recent Deloitte Financial Advisory Services (FAS) online poll of more than 520 executives. Data volumes are expanding and becoming unwieldy, according to 39.7% of poll respondents, who participated during a Deloitte FAS Webcast, “Strategic Discovery: Taking Steps to Avoid Litigation’s Black Hole.” Survey participants included executives from the banking, securities, financial services and technology industries. Deloitte FAS released the poll results last week. There are many more electronic data to discover in any given case than even five years ago, because most data are originated electronically, said Bruce Hartley, national practice leader for e-discovery for Deloitte FAS. Copies of documents and information are stored on, and may need to be retrieved from, many types of devices, including memory sticks, cellular telephones and iPods, he said. “The number of devices makes the overall data environment much more complex,” Hartley said. “The term ‘electronically stored information’ is pretty broad. We’ve seen court opinions where it’s extended to random access memory.” Hartley noted that corporate employees using e-mail as a filing system as well as for communication and documents in foreign languages, which are increasingly common as business becomes more global, also boost the intricacy of e-discovery. JUST ‘NOT READY’ A sizeable minority of executives, 17.5%, characterized their company as “not ready to handle complex discovery requests.” Some companies lack e-discovery policies, with 11.8% reporting no specific policies for document retention and destruction. An additional 9.4% of companies noted in the survey that they issue specific directives during litigation, but have no permanent policies on the books. Worries about the cost of e-discovery topped executives’ list of concerns, with 47.5% of respondents citing the expense of searching large volumes of files. Other worries stemmed from the complexities of adhering to document discovery mandates: 16.3% of respondents feared court sanctions due to vendor or in-house error, and 12.9% are anxious about failing to meet court deadlines. “There are real stakes and real penalties associated with poorly handled discovery,” Hartley said. “In the past few years, we have seen cases where defendants have faced jail time and millions of dollars in sanctions or penalties,” he added.

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