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Doug Austin

eDiscovery Searching: Types of Exception Files

Friday, we talked about how to address the handling of exception files through agreement with opposing counsel (typically, via the meet and confer) to manage costs and avoid the potential for spoliation claims.  There are different types of exception files that might be encountered in a typical ESI collection and it’s important to know how those files can be recovered.

Types of Exception Files

It’s important to note that efforts to “fix” these files will often also change the files (and the metadata associated with them), so it’s important to establish with opposing counsel what measures to address the exceptions are acceptable.  Some files may not be recoverable and you need to agree up front how far to go to attempt to recover them.

  • Corrupted Files: Files can become corrupted for a variety of reasons, from application failures to system crashes to computer viruses.  I recently had a case where 40% of the collection was contained in 2 corrupt Outlook PST files – fortunately, we were able to repair those files and recover the messages.  If you have readily accessible backups of the files, try to restore them from backup.  If not, you will need to try using a repair utility.  Outlook comes with a utility called SCANPST.EXE that scans and repairs PST and OST files, and there are utilities (including freeware utilities) available via the web for most file types.  If all else fails, you can hire a data recovery expert, but that can get very expensive.
  • Password Protected Files: Most collections usually contain at least some password protected files.  Files can require a password to enable them to be edited, or even just to view them.  As the most popular publication format, PDF files are often password protected from editing, but they can still be viewed to support review (though some search engines may fail to index them).  If a file is password protected, you can try to obtain the password from the custodian providing the file – if the custodian is unavailable or unable to remember the password, you can try a password cracking application, which will run through a series of character combinations to attempt to find the password.  Be patient, it takes time, and doesn’t always succeed.
  • Unsupported File Types: In most collections, there are some unusual file types that aren’t supported by the review application, such as files for legacy or specialized applications (e.g., AutoCad for engineering drawings).  You may not even initially know what type of files they are; if not, you can find out based on file extension by looking the file extension up in FILExt.  If your review application can’t read the files, it also can’t index the files for searching or display them for review.  If those files may be responsive to discovery requests, review them with the native application to determine their relevancy.
  • No-Text Files: Files with no searchable text aren’t really exceptions – they have to be accounted for, but they won’t be retrieved in searches, so it’s important to make sure they don’t “slip through the cracks”.  It’s common to perform Optical Character Recognition (OCR) on TIFF files and image-only PDF files, because they are common document formats.  Other types of no-text files, such as pictures in JPEG or PNG format, are usually not OCRed, unless there is an expectation that they will have significant text.

It’s important for review applications to be able to identify exception files, so that you know they won’t be retrieved in searches without additional processing.  FirstPass™, powered by Venio FPR™, is one example of an application that will flag those files during processing and enable you to search for those exceptions, so you can determine how to handle them.

So, what do you think?  Have you encountered other types of exceptions?  Please share any comments you might have or if you’d like to know more about a particular topic.

eDiscovery Searching: Exceptions are the Rule


Virtually every collection of electronically stored information (ESI) has at least some files that cannot be effectively searched.  Corrupt files, password protected files and other types of exception files are frequent components of your ESI collection and it can become very expensive to make these files searchable or reviewable.  Being without an effective plan for addressing these files could lead to problems – even spoliation claims – in your case.

How to Address Exception Files

The best way to develop a plan for addressing these files that is reasonable and cost-effective is to come to agreement with opposing counsel on how to handle them.  The prime opportunity to obtain this agreement is during the meet and confer with opposing counsel.  The meet and confer gives you the opportunity to agree on how to address the following:

  • Efforts Required to Make Unusable Files Usable: Corrupted and password protected files may be fairly easily addressed in some cases, whereas in others, it takes extreme (i.e., costly) efforts to fix those files (if they can be fixed at all).  Up-front agreement with the opposition helps you determine how far to go in your recovery efforts to keep those recovery costs manageable.
  • Exception Reporting: Because there will usually be some files for which recovery is unsuccessful (or not attempted, if agreed upon with the opposition), you need to agree on how those files will be reported, so that they are accounted for in the production.  The information on exception reports will vary depending on agreed upon format between parties, but should typically include: file name and path, source custodian and reason for the exception (e.g., the file was corrupt).

If your case is in a jurisdiction where a meet and confer is not required (such as state cases where the state has no rules for eDiscovery), it is still best to reach out to opposing counsel to agree on the handling of exception files to control costs for addressing those files and avoid potential spoliation claims.

On Monday, we will talk about the types of exception files and the options for addressing them.  Oh, the suspense!  Hang in there!

So, what do you think?  Have you been involved in any cases where the handling of exception files was disputed?  Please share any comments you might have or if you’d like to know more about a particular topic.

eDiscovery Case Law: Discovery Compelled for Social Media Content

Discoverability of social-media usage continues to be a hot topic for eDiscovery.  Information for litigants’ LinkedIn, Facebook, Twitter and MySpace accounts can be the “smoking gun” for litigators looking to pursue or defend a claim.

In McMillen v. Hummingbird Speedway, Inc., No. 113-2010 CD (C.P. Jefferson, Sept. 9, 2010), defendant Hummingbird Speedway, Inc. sought to compel discovery of the plaintiff’s social network account log-in names, and passwords.  A copy of the opinion granting that Motion to Compel is available here.

The plaintiff was allegedly injured during a stock car race in the summer of 2007.  During the litigation that followed, defendant Hummingbird Speedway, Inc. requested production of plaintiff’s user names, log-in names, and passwords for any social network accounts – to which the plaintiff objected, arguing that the information was confidential.  Based on information in the public sections of the plaintiff’s social network accounts, the defendant filed a Motion to Compel.

In his opposition to the motion, the plaintiff argued that communications with friends via social media sites were private and protected from disclosure. The court disagreed, indicating that the plaintiff was essentially asking the court to recognize an evidentiary privilege for such communications, but that there is no “social media privilege” recognized by Pennsylvania’s court or legislature.

The court also noted that those communications were not privileged based on “Wigmore’s test for privilege”, which requires the plaintiff to establish four factors:

  • “His communications originated in the confidence that they would not be disclosed”;
  • “The element of confidentiality is essential to fully and satisfactorily maintain the relationship between the affected parties”;
  • “Community agreement that the relationship must be sedulously fostered”; and
  • “The injury potentially sustained to the relationship because of the disclosure of the communication outweighs the benefit of correctly disposing of litigation”.

Because the plaintiff failed to establish these factors, the court ultimately ruled that “Where there is an indication that a person’s social network sites contain information relevant to the prosecution or defense of a lawsuit…and the law’s general dispreference for the allowance of privileges, access to those sites should be freely granted”.

So, what do you think?  There have been other cases where the discoverability of social media was called into question – have you experienced any?  Please share any comments you might have or if you’d like to know more about a particular topic.

P.S. – For those (like me) who didn’t know what the word “sedulously” meant, I’ve provided a link to the definition above… 🙂

eDiscovery Case Law: Adverse Interference Sanction for Lost Text Messages

As the sources of electronic files continue to become more diverse, case law associated with those different sources has become more commonplace.  One ruling in a case last month resulted in an adverse instruction against the US Government for failing to preserve text messages.

In United States v. Suarez, (D.N.J. Oct. 21, 2010), United States District Judge Jose L. Linares considered adverse inference sanctions related to the Government’s failure to preserve text messages.  In this case, the F.B.I. should have retained text messages between a cooperating witness and F.B.I. agents because it was reasonably foreseeable that the text messages would be discoverable by defendants in later criminal proceedings. However, given the lack of evidence of Government bad faith in failing to impose a litigation hold on the text messages until seven months after its investigation ended, the court imposed the “least harsh” spoliation adverse inference instruction that would allow but not require the jury to infer that missing text messages were favorable to defendants.

A cooperating witness posed as a developer and, as instructed by Federal Bureau of Investigation agents, offered payments to local public officials in exchange for expediting his projects and other assistance. During the F.B.I. investigation, the witness exchanged Short Message Service electronic communications (text messages) with F.B.I. agents. In later criminal proceedings, the government notified the court that it had incorrectly stated that no text messages were missing. The court held a hearing at which F.B.I. agents and information technology specialists described F.B.I. procedures to preserve and retrieve data generated by handheld devices. Despite an F.B.I. Corporate Policy Directive on data retention and litigation hold policies, no litigation hold was in place when the cooperating witness was “texting” with agents.

In a “not-for-publication” decision, the court pointed out that the Government’s obligation under Fed. R. Crim. P. 16 to disclose information was more limited than its obligation under civil discovery rules. However, the text messages with the witness were “statements” under the Jencks Act that should have been preserved by the Government. The F.B.I. was “well-equipped” to preserve documents, and the U.S. Attorney “was aware of the importance of preserving documents relevant to the litigation and could have requested a litigation hold on the text messages from the inception of the investigation.” The request for a litigation hold was not made until seven months after the investigation ended and three months after the F.B.I. began searching its servers for missing text messages.

In determining sanctions, the court considered precedents in the civil cases of MOSAID Techs. Inc. v. Samsung Elecs. Co., 348 F. Supp. 2d 332 (D.N.J. 2004), and Pension Comm. of the Univ. of Montreal Pension Plan v. Banc of Am. Sec., LLC, 685 F. Supp. 2d 456 (S.D.N.Y. 2010). The court concluded there was “little evidence” of Government bad faith leading to loss of the text messages. On the other hand, evidence indicated the defense was prejudiced by the loss of text messages with the cooperating witness, whose credibility was “of paramount importance.” The court thus denied defendants’ request for the “relatively severe” sanction of suppression of the witness’s testimony and all tape recordings in which he was a party. However, an adverse inference instruction was appropriate under MOSAID criteria. The text messages had been within the Government’s control and were intentionally deleted by F.B.I. agents, and the U.S. Attorneys’ Office failed to take steps to preserve the messages. The messages were relevant to claims or defenses, and it was reasonably foreseeable by the Government that the messages would later be discoverable. The court concluded that the “least harsh” spoliation adverse inference jury instruction described in Pension Committee would be issued because Government bad faith had not been shown. Such an instruction would allow but not require the jury to infer that missing text messages were favorable to defendants.

So, what do you think?  Have you encountered a case where preservation of text messages was a critical component?  Please share any comments you might have or if you’d like to know more about a particular topic.

Case Summary Source: Applied Discovery (free subscription required).  For eDiscovery news and best practices, check out the Applied Discovery Blog here.

Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by CloudNine Discovery. eDiscoveryDaily is made available by CloudNine Discovery solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscoveryDaily should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.

eDiscoveryJournal Webinar: More on Native Format Production and Redaction

As noted yesterday, eDiscoveryJournal conducted a webinar last Friday with some notable eDiscovery industry thought leaders regarding issues associated with native format production and redaction, including George Socha, Craig Ball and Tom O’Connor, and moderated by Greg Buckles, co-founder of eDiscoveryJournal, who has over 20 years experience in discovery and consulting.

What follows is more highlights of the discussion, based on my observations and notes from the webinar.  If anyone who attended the webinar feels that there are any inaccuracies in this account, please feel free to submit a comment to this post and I will be happy to address it.

More highlights of the discussion:

  • Redaction – Is it Possible, Practical, Acceptable?: George said it’s certainly possible and practical, but the biggest problem he sees is that redaction is often done without agreement between parties as to how it will be done.  Tom noted that the knee jerk reaction for most of his clients is “no” – to do it effectively, you need to know your capabilities and what information you’re trying to change.  Craig indicated that it’s not only possible and practical, but often desirable; however, when removing information such as columns from databases or spreadsheets, you need to know data dependencies and the possibility of “breaking” the file by removing that data.  Craig also remarked that certain file types (such as Microsoft Office files) are now stored in XML format, making it easier to redact them natively without breaking functionality.
  • How to Authenticate Redacted Files based on HASH Value?:  Craig said you don’t – it’s a changing of the file.  Although Craig indicated that some research has been done on “near-HASH” values, George noted that there is currently no such thing and that the HASH value changes completely with a change as small as one character.  Tom noted that it’s “tall weeds” when discussing HASH values with clients to authenticate files as many don’t fully understand the issues – it’s a “where angels fear to tread” concern.
  • Biggest Piece of Advice Regarding Redaction?: Craig said that redaction of native files is hard – So what?  Is the percentage of files requiring redaction so great that it needs to drive the process?  If it’s a small percentage, you can always simply TIFF the files requiring redaction and redact the TIFFs.  George indicated that one of the first things he advises clients to do is to work with the other side on how to handle redactions and if they won’t work with you, go to the judge to address it.  Tom indicated that he asks the client questions to find out what issues are associated with the redaction, such as what the client wants to accomplish, percentage of redaction expected, etc. and then provides advice based on those answers.
  • Redaction for Confidentiality (e.g., personal information, trade secrets, etc.): George noted that, while in many cases, it’s not a big issue; in some cases, it’s a huge issue.  There are currently 48 states that have at least some laws regarding safeguarding personal information and also efforts underway to do so at a national level.  We’re a long way from coming up with an effective way to address this issue.  Craig said that sometimes there are ways to address programmatically – in one case where he served as special master, his client had a number of spreadsheets with columns of confidential data and they were able to identify a way to handle those programmatically.  Tom has worked on cases where redaction of social security numbers through search and replace was necessary, but that there was a discussion and agreement with opposing counsel before proceeding.
  • How to Guarantee that Redaction Actually Deletes the Data and Doesn’t Just Obscure it?: Tom said he had a situation on a criminal case where they received police reports from the Federal government with information on protected witnesses, which they gave back.  There is not a “cookie-cutter” approach, but you have to understand the data, what’s possible and provide diligent QC.  Craig indicated that he conducts searches for the redacted data to confirm it has been deleted.  Greg noted that you have to make sure that the search tool will reach all of the redacted areas of the file.  George said too often people simply fail to check the results – providers often say that they can’t afford to perform the QC, but law firms often don’t do it either, so it falls through the cracks.  Tom recommends to his law firm clients that they take responsibility to perform that check as they are responsible for the production.  As part of QC, it’s important to have a different set of eyes and even different QC/search tools to confirm successful redaction.

Thanks to eDiscoveryJournal for a very informative webinar!

So, what do you think?  Do you have any other questions about native format production and redaction?  Please share any comments you might have or if you’d like to know more about a particular topic.

eDiscoveryJournal Webinar: Debate on Native Format Production and Redaction


eDiscoveryJournal conducted a webinar last Friday with some notable eDiscovery industry thought leaders regarding issues associated with native format production and redaction.  The panel included George Socha of Socha Consulting, LLC and co-founder of EDRM, Craig Ball of Craig D. Ball, P.C. and author of numerous articles on eDiscovery and computer forensics, and Tom O’Connor, who is a nationally known consultant, speaker and writer in the area of computerized litigation support systems.  All three panelists are nationally recognized speakers and experts on eDiscovery topics.  The panel discussion was moderated by Greg Buckles, co-founder of eDiscoveryJournal, who is also a recognized expert with over 20 years experience in discovery and consulting.

I wrote an article a few years ago on review and production of native files, so this is a subject of particular interest to me.  What follows is highlights of the discussion, based on my observations and notes from the webinar.  If anyone who attended the webinar feels that there are any inaccuracies in this account, please feel free to submit a comment to this post and I will be happy to address it.

Having said that, here are the highlights:

  • Definition of Native Files: George noted that the technical definition of native files is “in the format as used during the normal course of business”, but in the application of that concept, there is no real consensus.  Tom, who has worked on a number of multi-party cases has found consensus difficult as parties have different interpretations as to what defines native files.  Craig noted that it’s less about format than it is ensuring a “level of information parity” so that both sides have the opportunity to access the same information for those files.
  • “Near-Native” Files: George noted that there is a “quasi-native” or “near-native” format, which is still a native format, even if it isn’t in the original form.  If you have a huge SQL database, but only produce a relevant subset out of it in a smaller SQL database, that would be an example of a “near-native” format.  Individual Outlook MSG files are another example that, as Craig noted, are smaller components of the original Outlook mailbox container for which individual message metadata is preserved.
  • Position of Producing Native Files: Craig noted that the position is often to provide in a less usable format (such as TIFF images) because of attorneys’ fear that the opposition will be able to get more information out of the native files than they did.  George noted that you can expect expert fees to double or even quadruple when expecting them to work with image files as opposed to native files.
  • Negotiation and Production of Metadata: Tom noted that there is a lack of understanding by attorneys as to how metadata differs for each file format.  Craig noted that there is certain “dog tag” metadata such as file name, path, last modified date and time, custodian name and hash value, that serve as a “driver’s license” for files whereas the rest of the more esoteric metadata complete the “DNA” for each file.  George noted that the EDRM XML project is working towards facilitating standard transfer of file metadata between parties.
  • Advice on Meet and Confer Preparation: When asked by Greg what factor is most important when preparing for meet and confer, Craig said it depends partly on whether you’re the primary producing or requesting party in the case.  Some people prefer “dumbed down” images, so it’s important to know what format you can handle, the issues in the case and cost considerations, of course.  George noted that there is little or no attention on how the files are going to be used later in the case at depositions and trial and that it’s important to think about how you plan to use the files in presentation and work backward.  Tom noted it’s really important to understand your collection as completely as possible and ask questions such as: What do you have?  How much?  What formats?  Where does it reside?  Tom indicated that he’s astonished how difficult it is for many of his clients to answer these questions.

Want to know more?  Tune in tomorrow for the second half of the webinar!  And, as always, please share any comments you might have or if you’d like to know more about a particular topic.

State eDiscovery Rules: Oklahoma Adopts Amendments to Rules for eDiscovery


Though the amendments to the Federal Rules of Civil Procedure in December of 2006 have affected how discovery of ESI is handled in Federal courts, lawyers who practice exclusively in state court cases may not have had to consider rules for handling of ESI in their cases.  Some states have adopted civil procedure rules for eDiscovery; others have not.

Effective today, one state that has adopted new amendments to their Rules of Civil Procedure is Oklahoma.  Reagan DeWitt-Henderson of Litgistix Business Solutions, based in Tulsa, has written a terrific article that will be published in this month’s Tulsa Lawyer that addresses the Oklahoma rules changes in detail.  To access the article online, click here.

Highlights of the changes (as discussed in the article):

  • ESI is Added to the List of Obtainable Discovery (12 O.S. § 3226).
  • Only Reasonably Accessible Data to be Produced (12 O.S. § 3226): ESI must be “reasonably accessible” or else good cause must be shown for a court order to require its production.  Parties will be required to produce ESI, assuming the ESI sought is not unreasonably cumulative or overly difficult to obtain.
  • ESI Category Added as Form of Production that Can be Specified (12 O.S. § 3234): This rule is amended specifically to list ESI as data that can be requested.  Also, the producing party must generally state the form(s) of production it intends to use, which is significant as form of production (e.g., native files or scanned images, with or without metadata) determines the extent to which the collection is searchable and whether expensive conversion is required to make it searchable.
  • Option to Produce Business Records in Lieu of Answering Interrogatories Now Includes ESI (12 O.S. § 3233): However, a producing party may have to provide proprietary software or technical support to make the ESI useable to the other side or provide the ESI in a format that does not require proprietary software, or uses a free reader like Adobe Acrobat.
  • Must Address ESI in Mandatory Meet & Confer (12 O.S. § 3226): Lawyers must confer to address discovery issues, including issues related to ESI, but reporting to the judge is optional, unless so ordered.
  • “Clawback” of Confidential & Privilege Information After Unintentional Production (12 O.S. § 3226): "Clawback" of potentially privileged/confidential information is now supported, assuming the reasonable steps must have been taken to prevent the production of this material.
  • Third Party Subpoenas (12 O.S. § 2004.1): Many of the same provisions added also apply to third party subpoenas, including production of ESI, form of production and “clawback” of inadvertent productions.
  • Protection from Sanctions for Document Destruction from Good Faith Procedures (12 O.S. § 3237): Addresses the “safe harbor” provision for not providing ESI lost as a result of the routine, good-faith operation of systems but requires implementation of a “litigation hold” when the duty to preserve arises which may include suspending such operations.

Thanks to Reagan and our friends at Litgistix for such a comprehensive article about the Oklahoma rules changes!  Over the next several weeks, we will look at other states that have adopted similar rules and status of states that have not yet done so.

So, what do you think?  Wondering where your state stands?  Please share any comments you might have or if you’d like to know more about a particular topic.

Sanctions and Other Things that Go Bump in the Night

Sunday is Halloween, so it seems appropriate to try to “scare” you before the big day.  Does this scare you?

“pervasive and willful violation of serial Court orders to preserve and produce ESI evidence be treated as contempt of court, and that he be imprisoned for a period not to exceed two years, unless and until he pays to Plaintiff the attorney’s fees and costs that will be awarded to Plaintiff as the prevailing party”

What about this?

“From this Court’s perspective, a monetary sanction of $150,000 should be sufficient to compensate Plaintiffs for their added expense and deter SanDisk from taking shortcuts.”

Or this?

“For his misconduct, Peal has already received a severe sanction in having his complaint dismissed with prejudice.”

How about this?

A party does not need formal notice to know that spoliation of evidence and misrepresentations may lead to dismissal.”

Scary, huh?  If the possibility of sanctions keep you awake at night, then the folks at eDiscovery Daily will do our best to provide useful information and best practices to enable you to relax and sleep soundly, even on Halloween!

Of course, if you really want to get into the spirit of Halloween, click here.

What do you think?  Is there a particular eDiscovery issue that scares you?  Please share your comments and let us know if you’d like more information on a particular topic.

Happy Halloween!

Thought Leader Q&A: Brad Jenkins of Trial Solutions


Tell me about your company and the products you represent. Trial Solutions is an electronic discovery software and services company in Houston, Texas that assists corporations and law firms in the collection, processing and review of electronic data. Trial Solutions developed OnDemand™, formerly known as ImageDepot™, an online e-discovery review application which is currently used by over fifty of the top 250 law firms including seven of the top ten.  Trial Solutions also offers FirstPass™, an early case assessment and first-pass review application.  Both applications are offered as a software-as-a-service (SaaS), where Trial Solutions licenses the applications to customers for use and provides access via the Internet. Trial Solutions provides litigation support services in over 90 metropolitan areas throughout the United States and Canada.

What do you see as emerging trends for eDiscovery SaaS solutions?  I believe that one emerging trend that you’ll see is simplified pricing.  Pricing for many eDiscovery SaaS solutions is too complex and difficult for clients to understand.  Many providers base pricing on a combination of collection size and number of users (among other factors) which is confusing and penalizes organizations for adding users into a case,  I believe that organizations will expect simpler pricing models from providers with the ability to add an unlimited number of users to each case.

Another trend I expect to see is provision of more self-service capabilities giving legal teams greater control over managing their own databases and cases.  Organizations need the ability to administer their own databases, add users and maintain their rights without having to rely on the hosting provider to provide these services.  A major self-service capability is the ability to load your own data on your schedule without having to pay load fees to the hosting provider.

Why do you think that more eDiscovery SaaS solutions don’t provide a free self loading capability?  I don’t know.  Many SaaS solutions outside of eDiscovery enable you to upload your own data to use and share via the Web.  Facebook and YouTube enable you to upload and share pictures and videos, Google Docs is designed for sharing and maintaining business documents, and even allows you to upload contacts via a comma-separated values (CSV) file.  So, loading your own data is not a new concept for SaaS solutions.  OnDemand™ is about to roll out a new SelfLoader™ module to enable clients to load their own data, for free.  With SelfLoader, clients can load their own images, OCR text files, native files and metadata to an existing OnDemand database using an industry-standard load file (IPRO’s .lfp or Concordance’s .opt) format.

Are there any other trends that you see in the industry?  One clear trend is the rising popularity in first pass review/early case assessment (or, early data assessment, as some prefer) solutions like FirstPass as corporate data proliferates at an amazing pace.  According to International Data Corporation (IDC), the amount of digital information created, captured and replicated in the world as of 2006 was 161 exabytes or 161 billion gigabytes and that is expected to rise more than six-fold by 2010 (to 988 exabytes)!  That’s enough data for a stack of books from the sun to Pluto and back again!  With more data than ever to review, attorneys will have to turn to applications to enable them to quickly cull the data to a manageable level for review – it will simply be impossible to review the entire collection in a cost-efficient and timely manner.  It will also be important for there to be a seamless transition from first pass review for culling collections to attorney linear review for final determination of relevancy and privilege and Trial Solutions provides a fully integrated approach with FirstPass and OnDemand.

About Brad Jenkins
Brad Jenkins, President and CEO of Trial Solutions, has over 20 years of experience leading customer focused companies in the litigation support arena. Brad has authored many articles on litigation support issues, and has spoken before national audiences on document management practices and solutions.

Thought Leader Q&A: Kirke Snyder


Tell me about yourself and your experience.  I am a professor of law and ethics at Regis University College for Professional Studies in Denver, Colorado. The opinions expressed in this article are mine and are based upon my 25 years of experience consulting with public and private organizations.

Why is records management so important within the scope of eDiscovery?  Records Management is a sub-set of an organization’s overall information management. Take a look at the Electronic Discovery Reference Model (EDRM). Information management is on the far left-hand side of the model. An effective records/information management program is the most effective way for a company to reduce the volume of data that will become snagged in litigation hold, collection, production, and attorney review.

What are the most important concerns about corporate records and information management?  Organizations should be concerned about managing their corporate records for two main reasons: (1) the risk associated with regulatory compliance and litigation hold requirements, and (2) the cost of reviewing data to identify potentially relevant documents associated with litigation or an investigation.

What are the main risks associated with regulatory compliance and litigation hold requirements?  There are thousands of recordkeeping laws and regulations. A sound corporate records and information (RIM) program must be based upon legal research that identifies the applicable regulatory requirements (federal, state, and industry specific). Retention or destruction requirements apply to commonly encountered corporate records, such as job applications, employee medical records, and tax returns, as well as to the distinctive recorded information associated with specific industries, such as banking, insurance, pharmaceuticals, healthcare, energy, and telecommunications. Further, certain business records are subject to privacy legislation and regulations that protect personal information from unauthorized disclosure or use. Examples of U.S. laws with such privacy provisions include the Fair Credit Reporting Act (1992), the Health Insurance Portability and Accountability Act (1996), and the Gramm-Leach-Bliley Act (1999).

In addition to retaining corporate information to support a regulatory requirement, organizations must hold information that may be potentially relevant to litigation or an investigation. As a matter of fact, it is illegal for any organization to knowingly and intentionally destroy records relevant to pending or ongoing litigation or government investigations, even though their document management policies would otherwise permit such destruction. For public companies, the Sarbanes-Oxley Act of 2002 includes additional recordkeeping provisions and mandated retention requirements for certain types of records. It also criminalizes and provides severe penalties for executives and employees who obstruct justice by destroying or tampering with corporate accounting records. Most notably, the Sarbanes-Oxley Act created a new federal crime for the destruction, mutilation, or alteration of corporate records with the intent to impede or influence a government investigation or other official proceeding, either “in relation to or in contemplation of any such matter or case.” This provision expands upon previous laws relating to the destruction of records with presumed intent to obstruct justice.

How do you justify the cost of a good records management and information program?  With regards to litigation, size does matter. The cost of the litigation discovery process has a direct correlation to the volume of potentially relevant documents related to the matter. The smaller the population of potentially relevant data, the lower the costs will be from vendors to process the data into a searchable database and the lower the fees will be from outside counsel to review each email or document. Most organizations do not have an automated means to identify, collect, and preserve electronically stored information (ESI) based upon search criteria (key words, document type, document date or author). We hear the terminology megabyte, gigabyte, and terabyte used with regards to storage capacity of network servers, computer hard drives, and even portable “thumb drives.” To cost justify a budget for a new records/information management program, it’s important to convert the MB’s, GB’s. and TB’s into something to which management can relate. One megabyte of user documents is approximately one ream of paper. One ream of paper wouldn’t take the lawyers too long to review. However, one gigabyte of user documents if printed would be the approximate length of a basketball court and would require a team of lawyers to review. One terabyte of user documents if printed would be the approximate length of Long Island. It’s easy to see the economic and strategic advantage for an organization to be able to identify the smallest legally defensible data population (without duplicates) prior to handing over the data to vendors for processing or outside counsel for review.

About Kirke Snyder

Kirke has earned a law degree and also a masters degree in legal administration. He is an expert in document retention and litigation electronic discovery issues. He can be reached at