Editor: Could you tell our readers about your professional experience?
Gannaway: My experience predominantly has been as a financial fraud investigator with the Internal Revenue Service Criminal Investigation Division. For the last two and one-half years, I have been assisting attorneys with internal investigations that may involve embezzlement and foreign bank account and financial account reporting requirements related to the UBS matter.
Ward: As an undergraduate, I started working with the New York State Pre-trial Release Program, conducting civil and criminal investigations. For the last fifteen years, I have worked with law firms handling investigations for complex litigation fraud, computer forensic analysis, and trademark and patent infringement cases.
Editor: Do you believe that e-discovery costs can be brought into line?
Ward: When it comes to e-discovery and computer forensics, the biggest problem is that it is very expensive. Attorneys aren't given a road map to follow because the courts haven't picked a direction, and each case differs. In some cases, the judge will restrict discovery and in other cases, it will be the exact opposite.
Gannaway: It depends on the type of the case. If the case is very document intensive, it is very difficult to cut costs because you have to go through the documents and do the analysis. However, costs can be cut through utilizing a third party who can download the servers, retrieve the information, and provide it in a summary form. It is more efficient, and the attorneys receive the product more quickly. Saving attorneys' time saves money.
Editor: In working with attorneys, do you find that they often go beyond the basic needs in discovery? Do they overreach?
Gannaway: Hindsight is 20/20. It is easier to look at a case after it's over and say that it was overreaching. However, when someone is just starting an investigation, the initial strategy may take you down one path and as you gather evidence the new information may cause you to pursue another avenue.
Ward: As an attorney, you don't want to be in a position where you don't ask for something to find out later that you should have asked for it because that is where the treasure trove was.
Ward: There are a lot of tools out there for the practitioner, but not every tool meets every need. Often I have seen attorneys err on the side of caution for their clients, advising them that at a certain point, it might not be worth spending the extra money.
Editor: David, can you give us a brief overview of the use of e-discovery in the area of money laundering?
Gannaway: The core of the money laundering investigation statute is that you have to have a financial transaction. The core documents needed are bank records, which are produced in a PDF-type file. Those files then have to be converted to a usable summary-type Excel format to save the cost of data key input.
Editor: Stephen, as a private investigator, can you give us a brief overview of your use of e-discovery in an intellectual property investigation?
Ward: We focus on computer forensics. For example, in patent and trademark cases, theft of trade secrets is common. If individuals are employed by a specific corporation to develop a software product and then go to a competitor, they may take their work with them. My client has to prove that the competitor is benefiting from the stolen software product. We conduct a forensic review to show how the former employee accessed the information; how they got it out of my client's office; and how it was forwarded to their new employer.
Editor: Do you have any suggestions on how attorneys can save money for their clients during this time of controlling legal cost?
Gannaway: Preparing a realistic and focused work plan memorializing what you are trying to prove, including what records or what testimony you need, is the best way to save money. This way, you can determine which transactions are relevant.
Ward: For several years, major corporations, which are the actual targets of e-discovery, did not want to invest in ways to address e-discovery. They'd rather wait until there was a lawsuit. We strongly recommend being proactive and developing an electronic discovery procedure manual policy that can provide a blueprint for a response to an e-discovery request. It is much more cost efficient to have a plan in place.
Gannaway: You have to look at the cost-benefit analysis. There are break-even points, and you have to determine what value you can bring to the client if you go through many more transactions for minimal benefits. The client should understand that it may be that you are not going to get 100 percent of the information. It may be that 80 percent is the best that you can do, especially given the budget. This is why a focused, specific work plan is essential.
Ward: Cost has been a big issue with law firms now working at a flat rate. When a law firm is selecting an e-discovery vendor, the most important thing is to ensure that the vendor is willing to work with the attorneys and not surprise them with back end fees. That really comes down to the quality of the third-party vendor that they are using.