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Where Some of Your Tax Dollars are Going, if you’re in Tennessee – eDiscovery Trends

One of the topics at the roundtable discussion after the Houston showing of The Decade of Discovery the other night was regarding Rule 37(e), preservation and sanctions.  Apparently, at least in one state, the burden of preservation has become a fairly significant cost to that state.

In a post on the Nashville Public Radio blog site (of all places!) titled Tennessee Agencies Are Spending ‘A Huge Amount Of Money’ To Store Emails For Lawsuits, Bobby Allyn described a recent budget hearing with the Tennessee governor and the Department of Children’s Services (DCS) Commissioner Jim Henry, who said:

“Litigation hold on email storage is $865,000, which, you know, is a huge amount of money for us to pay just to store emails”.

As the author noted, “It’s a figure expected to climb to $1.1 million. Just a few years ago, it was almost nothing.”

Because of court orders aimed at ensuring that potential lawsuit evidence isn’t being hidden or destroyed, Tennessee state agencies are spending millions of dollars on email storage.  In particular, DCS’ sum stems from a 14-year-old federal lawsuit brought by a New York-based child advocacy firm that sued the state over claims of unsafe conditions in Tennessee foster homes and other allegations of systemic issues plaguing the department.  While the $865,000 is a fraction of the $32 million the suit has cost DCS over two fiscal years, moving and preserving email communication is still a significant expense that most people don’t realize.

Overall, the state is expected to spend $1.6 million this fiscal year on paying staff and outside firms to save emails, according to Lola Potter, spokeswoman for Tennessee’s Inspector General.  And, that total apparently doesn’t include litigation-related email storage services in a number of state agencies, such as TennCare which has litigation holds on about 20 lawsuits, and spends more than $1 million a year on transferring and storing employee emails connected to the suits, thanks to court orders that mandate saving of the emails.

So, what do you think?  Are litigation hold costs escalating in your state government or your organization?  Please share any comments you might have or if you’d like to know more about a particular topic.

Thanks to Nashville attorney Thomas B. Norris, Jr. for the tip on this article!

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