A successful corporate e-discovery readiness program requires more than efficient deployment of qualified people, process and products. Readiness is measured most practically in the corporation’s response to inspection, and the strength, resilience and confidence with which the next e-discovery “circus” is managed. Corporate counsel are the first line of defense against unreasonable discovery and are expected to pursue proportionate discovery to control costs. A robust e-discovery cost allocation program will leverage corporate e-discovery benchmarks and data profiles to support counsel’s response to unreasonable discovery demands with factual statements of the anticipated burden and expense of performance.

In May, Admiral William McRaven gave the commencement address at the University of Texas. McRaven, a former SEAL team leader, passed on some lessons he learned during SEAL training. Oddly enough, those lessons involved “sugar cookies” and “circuses.”

A “sugar cookie”, he explained, was the punishment for failing uniform inspections. The student had to run into the surf and then roll on the beach until covered with sand (hence the name), and then had to wear the cold, wet, sandy uniform the rest of the day. Many students, he said, complained that their efforts never seemed to be good enough, but they were missing the point — no matter how hard you try, the results will never meet a standard of perfection. When the standard is perfection and the objective is correction, there will always be failure.

Similarly, those who failed to complete challenges on time were invited to a “circus,” an additional two hours of calisthenics. Everyone got the invitation at some point — and, he noted, ended up stronger because of it. “Life is filled with circuses,” McRaven said. “You will likely fail often. It will be painful. It will be discouraging. At times it will test you to your very core.” But those individuals and teams who survive these challenges, ultimately develop the strength, resilience and confidence, to both meet future challenges and motivate peers to do the same.

Those life lessons are invaluable and applicable in the context of corporate readiness for discovery. Most likely, the closest inspection will turn up some number of problems, and those problems may have undesirable consequences. The resolve of corporate counsel to avoid the consequence of a standard of perfection and pursue reasonableness in discovery is critical to success. Similarly, an understanding of the limits of reason and the high costs of compelled performance, and experience pursuing proportionality, will ultimately increase our readiness.

We have previously discussed the e-discovery project model and introduced the concepts of scope refinement and cost allocation as a discrete lifecycle stage. Those concepts, in fact, are critical to achieving reasonableness in discovery, and attaining both proportionality and cost containment in corporate e-discovery throughout a project lifecycle.

The sea of enterprise data is too deep, and the lure of settlement leverage too strong, for most litigants to resist making overbroad allegations and discovery requests. The broad scope of an inquiry or investigation may reflect a concern that relevant content may be overlooked unless the search is as broad as possible. But with rare exceptions, a corporation’s interests are best served by fast and efficient claim resolution, and putting reasonable limits on investigations is entirely consistent with discovery rules. In particular, FRCP Rule 26 states that discovery may be limited when the “burden and expense of the discovery outweighs its likely benefit, considering the needs of the case, the amount in controversy, the parties’ resources, the importance of the issues at stake in the litigation, and the importance of the proposed discovery in resolving the issues.” The impulse to be all-inclusive, then, should be suppressed in favor of reasonable scope and prioritization rules.

Scope refinement can have a direct impact on the quantity, quality and timeliness of content productions as well as financial costs. A company can defend those efforts with factual statements showing the anticipated burden and expense (B&E), or business impact, of the request. An e-discovery cost allocation program and B&E templates may integrate discovery prioritization strategies such as collection sequencing, sampling and summaries, distinguish search and retrieval strategies including predictive analytics, keyword and key-custodian selection, as well as prioritized review, and revisit acceptable performance indicators for recall and precision.

Opportunities for scope refinement and cost avoidance may be documented at critical transition points, including post-inventory/pre-collection (B&E forecast), post-collection/pre-review and mid-review (B&E budget), and post-review/pre-production (B&E statement). The valuations used may be based on actual historical costs, in time and money, for the described work units. And the calculated assumptions and run-rates may be based on benchmarks and data profiles maintained by the e-discovery readiness program. As projected work units become actual, values may be revised and forecasts replaced with budgets and financial statements at the next opportunity.

While work product and communications regarding the business impact of discovery strategies may be legally privileged and protected from discovery, the presentation of select B&E information is often critical to ensuring proportionality. Accurate B&E information can be used to support motions for protective order, oppose motions to compel or to arm counsel for conferences with the opposing side, among other things. More ammunition is provided by authorities supporting cost allocation as a remedy for unduly burdensome discovery, such as pending amendments to Rule 26(c)(1)(B), recent case law (i.e., Zubulake v. UBS Warburg; Race Tires America Inc. v. Hoosier Racing Tire Corp.; and Boeynaems v. LA Fitness Int’l, LLC), and numerous examples of protective orders issued by courts across the country.

Corporate counsel is charged today with both the legal defense of the business and the business leadership of an enterprise e-discovery readiness program. Operational and technical management is critical to success, but so is the deployment of an effective scope refinement and e-discovery cost allocation program. Armed with data discovery benchmarks and profiles, and an understanding of the costs of compelled discovery and the inevitable realities of inspection, a corporate e-discovery program will be ready for business.