Let this account serve as a cautionary tale of how an e-Discovery project can be mishandled. In fact, the case was so greatly mishandled it prompted me to write this article.
Say the word eDiscovery to a client and they will usually have two questions;
- How much is it going to cost,
- How will the review be structured and organized.
There are a few different ways to run a review, but there are countless ways to muck it up.
The account below is a true story. Names have been withheld to protect the not-so innocent.
The review began with about 1 million documents. The team was comprised of 4 groups, in 4 cities, totaling 32 reviewers. Everything proceeded smoothly at first and would have been fine except that new documents began to be added after the first week and every week thereafter. And thus the document universe was expanding beyond the team’s capabilities. When documents are added you must either A. add people, B. approve overtime, or C. use TAR (technology assisted review) to get through the expanding volume quicker.
So, what happened in this case? Four weeks into the review the team received a communication, “Pencils Down, we have to renegotiate the search terms.” For those who do not know what “renegotiate search terms” means let me translate. It means one of three things;
- We have too many documents,
- We are taking too long to review them,
- The client has seen the bill and is now reconsidering the current approach.
The not-so-subtle message to outside counsel is: do something!!!
Search terms are very difficult to renegotiate and to further complicate matters, opposing counsel will often not be agreeable or easy to deal with. So, what is one to do?
You can try to get your team to produce more, i.e. REVIEW FASTER. This, however, is very difficult. To get the team to do 50 documents or more per hour consistently for an extended period of time is almost impossible. The team may keep that pace before lunch, but inevitably things slow down to 30 per hour. I don’t know it for a fact, but it does not appear the client had the advice of an in-house e-Discovery attorney. Most likely the client deferred to their outside counsel. The outside counsel in this case also did not have best practices in place to handle a situation with an expanding document count. It is hard to win when both the client and outside counsel do not possess the requisite understanding on how to conduct an efficient document production.
No matter what the client says they will always wish to pay less. The last thing they want to do is waste time, money, or both. The firm should know this. After realizing how many documents were being added the firm should have presented a TAR option to the client. Built into TAR is something called, Continuous Active Learning (CAL). This CAL algorithm allows the review software to determine what is responsive and what is not based on how the review team is designating documents. After several thousand documents the software would begin to make responsiveness call. This is Artificial Intelligence and it is available today to deal with the ever expanding volume of data. It would have been a perfect solution to this problem. A seven-person team reviewing for six weeks would complete the initial I million documents. The way it works is after the team makes its choices the algorithm “LEARNS” how documents are to be coded. The software codes documents alongside the team. After a little bit of time only NON-RESPONSIVE documents are returned to the team. This is how you know that his particular set of documents needs no further review for responsiveness. You only now need to review for privilege. The same team would be able to handle all the additional documents. In addition to technology, Rule 26 of the Federal Rules of Civil Procedure is a tool that is used to limit scope of discovery.
Discovery is about managing scope. Rule 26 (b)(1) allows you to manage the scope of a review by using PROPORTIONALITY to make sure things don’t get out of hand. See F.R.Civ. P. 26(b)(1)(“Parties may obtain discovery … proportional to the needs of the case….”)(emphasis added). Outside counsel may look at the documents being collected and review them for precision (how many documents are irrelevant) then let opposing counsel know that the new documents are not yielding anything responsive and thus the burden of collecting and reviewing the new documents outweighs the benefit. Abbott v. Wyoming Cty. Sheriff’s Office, No. 15-CV-531W, 2017 WL 2115381, at *2 (W.D.N.Y. May 16, 2017)( Considerations of proportionality can include reviewing whether discovery production has reached a point of diminishing returns. See Alaska Elec. Pension Fund v. Bank of Am. Corp., No. 14-CV-7126 (JMF), 2016 WL 6779901, at *3 (S.D.N.Y. Nov. 16, 2016) (“Rule 26(b)(1)’s proportionality requirement means [that a document’s] ‘marginal utility’ must also be considered.”) (citations omitted); Updike v. Clackamas County, No. 3:15-CV-00723-SI, 2016 WL 111424, at *1 (D. Or. Jan. 11, 2016) (“There is a tension, however, among the objectives of Rule 1. As more discovery is obtained, more is learned. But at some point, discovery yields only diminishing returns and increasing expenses. In addition, as more discovery is taken, the greater the delay in resolving the dispute. Finding a just and appropriate balance is the goal, and it is one of the key responsibilities of the court in managing a case before trial to assist the parties in achieving that balance.”
Of course opposing counsel may disagree and insist on production, however, the case law is on the side of the producing party and the courts “SHOULD” side with the producing party in curtailing discovery. Moreover, Rule 26 (b)(2)(C) Allows the courts to limit discovery when:
(i) the discovery sought is unreasonably cumulative or duplicative
(ii) the party seeking discovery has had ample opportunity to obtain the information by discovery in the action
(iii) Discovery is outside the scope of Rule 26(b)(1)
I was not privy to any of the strategy discussions with outside counsel. I am simply deducing what happened based on how the review went forward after the “Pencils Down” announcement.
The team was told that there would be no responsiveness review, rather only a privilege review. Since the firm decided not to review for responsiveness. I can only assume there was no re-negotiation of terms. Counsel simply handed over everything they had which did save time and money. The review reappeared as a privilege review, i.e. all documents without a privilege term were going to be produced without review and the team would now only review for privilege. This is all well and good, however, the problem is that you will not identify the “HOT” documents to prepare for depositions and trial unless you conduct a responsiveness review. Perhaps searches for the HOT documents were going to be done simultaneously with the privilege review. I don’t know if this ever occurred for there was no communication from the firm regarding this project with me. It is possible that a select number of reviewers or associates were chosen for this project. I would guess that at some point some searches were conducted to identify the HOT documents to prepare for depositions and the possible trial.
ISSUES WITH THE PRIVILEGE REVIEW
The problem in this case is that the privilege review was a two-level review with a dummy review at the first level. A DUMMY PRIVILEGE review is when a team goes through all the documents with a privilege hit to determine if the hit is a false positive. Then, without making a privilege call you designate a document with a false privilege hit as NOT PRIVILEGED. All documents designated as not privilege are taken out of the review. The rest are reviewed for privilege. This is inefficient.
Dummy privilege reviews are rare today. It is far more cost effective and efficient to do the full privilege review on the first pass. The second-level review is left for Quality Control. You may choose a two-step review for redactions, however, that is also not necessary for you may convert the documents to a TIFF format for redactions as you go on a document by document basis. The dummy privilege review adds unnecessary cost to an already expensive process.
In our case the privilege review was taking too long as well, thus a SECOND “pencils down” notice was sent. This is probably because new privileged documents were also being added and the team wasn’t keeping up. The project never resumed after this point. No one I had contacts with from my team had worked on this matter again.
Discovery, many times is not about the law, per se, but about managing a small business with the goal of finishing on time and on budget. A Hollywood director may not always produce a hit, but she will continue to receive work if her films are completed on time and within the budget. Lawyers often forget to put on their business hats and approach a project from a business standpoint. That’s how you keep a client through e-Discovery.
Always remember this mantra: Clients do not pay for perfection, they pay for results.