Question: What does bringing e-discovery “in-house” mean, and why is it important?

Jake Frazier: E-discovery is a process fraught with risk of non-compliance, which results in huge costs that can be incurred when undergoing that process. Historically, companies have relied on outside vendors and consultants to do a lot of e-discovery for them. However, as the years went by, research and analyst firms like Gartner started to put four corners around this e-discovery problem, and actually came up with metrics on how much the different phases of e-discovery cost. This allowed companies to evaluate whether the process could be brought in-house and also measure efficiencies by leveraging investments and ROI.

Now that companies realize litigation is inevitable — with the amendments to the Federal Rules of Civil Procedure (FRCP) — and e-discovery is here to stay, they are starting to look at the most efficient way of doing this. This leads to companies assessing which tools and processes can be brought in-house behind the firewall so that e-discovery is conducted using tools that can be purchased, rather than hiring consultants for each new case and getting no bang for their buck from an investment standpoint.

Question: How does forensics play into this?

Jake Frazier: Those who are fairly new to e-discovery will make the comparison to computer forensics. Although forensics is a part of e-discovery at time, they are two different things for the most part. For example, if somebody is doctoring Excel sheets to inflate company earnings or has other contrabands on their computer, forensics would be the process of taking a mirror image of that hard drive and having certified technicians investigate and conduct data recovery processes to retrieve critical evidence that may have been lost either intentionally or accidentally. This is opposed to civil litigation, where no criminal charges are involved.

Whereas criminal investigations require retrieving evidence no matter what it takes, that’s not necessarily true in a civil case, which is governed by the FRCP and the concept of proportionality.

Therefore, forensics started to exit the average civil litigations. However, I still think that forensics can play an important role if there is evidence of alleged fraud or risk of criminal investigation and charges. Forensics can be used for those witnesses or custodians of records at the heart of the matter. In the past, companies would have performed forensic imaging on hundreds and thousands of drives and other pieces of media to investigate those even tangentially involved, but today we largely see FRCP’s proportionality stopping people from doing what they used to.

Question: What is the difference between appliance-based products and software-based products? Additionally, are there endto- end products available?

Jake Frazier: As companies realized the efficiencies of bringing e-discovery processes in-house and optimizing them by purchasing tools that can be used again and again, we started to see the market evolve for in-house e-discovery software. However, companies recognize the long uptake associated with software—installing, training, and getting it up and running—and often go outside of the organization to bring in consultants to do the work. The problem with this approach is that once the matter is over, there is no impetus to make changes or get a budget for these types of matters that could likely arise in the future.

Therefore, we started to see companies turn to e-discovery appliances, which really offer companies the best of both worlds. Essentially, it is like a server that is brought into a datacenter which already has the software preconfigured on it.

It is then simply plugged into the wall and becomes a visible network appliance that kicks off collections and allows lawyers to see documents and understand the strength of their case before either going through the cumbersome process of collecting documents or changing their strategy entirely. This network appliance can crawl through the network and provide a full view of everyone involved in the company’s litigation so that only those documents meeting the criteria can be found and moved over to a secure litigation repository—all in an automated way. So I believe appliancebased products are now preferable, and we see more companies gravitating towards them.

Question: What are the components of information governance?

Jake Frazier: I use the analogy that if e-discovery is the root canal, information governance is the brushing and flossing. If a corporation conducts diligent maintenance of its data, there is much less information that has to be processed through e-discovery. Gartner’s study found that every gigabyte of data—which is about 75,000 printed pages—sent to outside counsel for an attorneyclient privilege review costs about $18,750. It’s not uncommon for large corporations to send upwards of 100 gigabytes of data, so it quickly adds up to a sharp cost.

Generally, companies are getting over the sticker shock of e-discovery and are doing a good job of managing the proactive stance to e-discovery. They are even looking one step further at actually creating and maintaining the organization’s information. We see staggering amounts of data growing exponentially, and eventually, I believe, it will start to cripple any aspects of doing e-discovery efficiently.

Information governance is a way to make sure you secure the information that should be secured, retain the information that needs to be retained, dispose the information that you no longer need, and optimize the process for the next time around.

Many experts have been championing information governance for quite some time; we see it as the nirvana and e-discovery as the tip of the spear, which has made it a key focus point for organizations. Information governance allows organizations to treat information as the asset that it is, rather than a liability.

Question: What does acquisition of the data indexer company Kazeon mean for EMC’s approach to e-discovery?

Jake Frazier: Because EMC offers so many data infrastructure storage, content management, and archiving platforms like Documentum and SourceOne, companies around the world entrust their critical information to EMC. However, from an information governance and e-discovery standpoint, there were gaps with information “in the wild”— for example, on desktops, laptops, file shares, share points, or other disparate repositories— which is critical and subject to e-discovery.

So we are extremely excited about the acquisition with Kazeon because we are now able to provide a tool to search, crawl and build an index of every document out there to help our customers get an idea of what their liability is; it finally provides a window to those blind spots of unstructured information, which is a very valuable tool for information governance. Also, Kazeon is very unique because it enables our customers to take action on that data—such as deleting, retaining, storing, etc.—whereas traditional enterprise search failed to do this. Kazeon enables customers to delete unnecessary information with a defensible audit trail showing exactly the criteria that was used and make a forensically sound copy of information that is subject to a litigation hold. Once that information is in a litigation hold, attorneys can simply log in and run searches to view documents and separate the wheat from the chaff, which will reduce the amount of data, streamline the process, reduce risk and ultimately save a lot of money. So we’re pretty excited about all of this, and we see great things in the future for Kazeon in our SourceOne family of products.

Question: What does the future hold for e-discovery?

Jake Frazier: For the most part, I see a development towards corporations practicing the right proportionality, which is something I really can’t stress enough when I talk to people about e-discovery. Rule 26 in the FRCP about e-discovery and proportionality is really key. It is extremely important to take the right amount of action in proportion to each case.

I see the evolving case law moving companies along from not doing enough or going overboard to making an educated move towards proportionality being practiced in their e-discovery practices. The ever-increasing volume of data will continue to drive costs; however, I think proactive information governance and due diligence will serve as the only real solution for this problem, maintaining the right balance to ensure compliance with the obligations under the law, but keeping e-discovery costs from having a devastating effect on legal departments and the corporate bottom line.

eDiscovery StraightTalk by Jake Frazier, MBA, Esq.

We hope you have found this issue of eDiscovery StraightTalk insightful.  If you have questions that you would like to have answered in future issues, please submit them via email at david@kazeon.com.