Recovery Is In The Air: Setting The Stage For Future Growth

Tuesday, May 31, 2011 - 01:00

Al Driver


As a rain-soaked spring sets the stage for a verdant summer, we are seeing the emergence of the delicate green shoots of recovery. The private sector of this great nation is gathering its energies once again to create the conditions for surging economic growth. And, you, our corporate counsel readers, play a vital role because you provide advice to your corporate leadership that can unleash the full power of our economy.

Because of the tremendous proliferation of electronically stored information, the already high cost of U.S. litigation has been greatly increased. The immense cost of e-discovery, including preservation of ESI, reduces U.S. exports by detracting from their competitiveness and deters foreign companies from coming here to create jobs.

Those e-discovery-related costs have both a significant impact on a corporation's bottom line and are a major component of a legal department's budget. Therefore, they not only deserve the attention of all our readers, but also demand an effort on the part of every legal department to bring these costs under control. We are pleased to present in our Special Section on Controlling Legal Costs beginning on page 23 many articles on controlling such costs. They suggest effective strategies for controlling e-discovery costs and describe approaches that will mitigate them.

The devil is in the federal and state court rules governing e-discovery and preservation.Corporate counsel are fortunate that their concerns related to the litigation process have for the last 20 years been represented by Lawyers for Civil Justice. Its work is supported by three of the most prestigious defense counsel organizations, numerous large corporations, and the many leading law firms that serve as associate members. It works closely with organizations like the U.S. Chamber, ACC and the ABA, among others.

Gino Marchetti, the president of LCJ, and John Martin, its immediate past president, in their interviews on pages 1 and 23, respectively, outline what LCJ has done and plans to do to place reasonable bounds on the preservation obligation and to rein in excessive e-discovery.LCJ has a long history of successfully promoting reforms of the Federal Rules of Civil Procedure. John Martin points out in his interview that LCJ greatly improved the 2000 discovery and 2006 E-Discovery Amendments.

LCJ will continue to provide input about needed reforms of the FRCP to the Advisory Committee on Civil Rules. Gino mentions that the Advisory Committee on Civil Rules has already proposed rule language in three of LCJ's focus areas.

As mentioned by Gino in our front cover interview, LCJ is planning to make a major effort to curb unmeritorious e-discovery in state courts. This is particularly important because the great majority of cases involving corporations are brought in those courts. State reforms may also hasten the slow process of reforming the Federal Rules of Civil Procedure.

The activities of LCJ are key to controlling what is your legal department's most important cost. Don't sit passively by while it does the heavy lifting on your behalf.There are many ways in which the involvement of corporate counsel in its judicial reform efforts can be of critical importance. You can encourage your outside counsel to become associate members of LCJ or to become involved in its efforts through their defense counsel organizations. You can make yourselves available to testify. Your testimony before judicial or legislative committees is particularly effective because your company is the ultimate victim of unbridled e-discovery.

Another way you can contribute to the maintenance of a legal environment that encourages both domestic and foreign corporations to grow their U.S. operations is to alert your senior management to laws and regulations that constrain investment here or, worse yet, provide economic and other incentives not to invest here. As highlighted on pages 31 and 33, the recent complaint filed by the NLRB against Boeing reduces job creation by making the U.S. less attractive as a business location. It is important that companies make their concerns known.

On the positive side, it is clear that through organizations like the National Association of Corporate Directors, the U.S. is paving the way to a brighter economic future by growing a sophisticated group of corporate directors who can assure that our corporations, large and small, seize the opportunities offered not only by our national market but by an exploding global market fueled by the BRIC countries and by the huge consumer markets that will result from the demands for a better life by the aspiring populations of formerly stagnant economies. See pages 41 and 42.