How Applied Discovery’s Legal Hold Services Can Help Companies Comply With Their Duty To Preserve

Kelli Clark is the Vice President of Solutions and Services at Applied Discovery. In this role, Ms. Clark oversees the design of solutions and services to clients in a value-added, consultative manner and supervises delivery by the company’s industry-leading project managers, business analysts and solution managers. Ms. Clark is an industry veteran who has overseen hundreds of large-scale e-discovery projects and managed client-services, consulting and technical teams. She has spoken on e-discovery topics at CLE courses and seminars throughout the United States and Europe, and she has been called upon to provide expert testimony regarding e-discovery procedures and best practices. Ms. Clark is also a guest lecturer in the E-Discovery Management Program at the University of Washington. 

To learn more about how Applied Discovery’s Legal Hold Services can improve the defensibility of your e-discovery process, please contact Kelli Clark.


Please email the author at with questions about this article.

Applied Discovery, Inc.


“By now, it should be abundantly clear that the duty to preserve means what it says and that a failure to preserve records – paper or electronic – and to search in the right places for those records, will inevitably result in the spoliation of evidence.” In 2010, in her seminal opinion in Pension Committee of University of Montreal Pension Plan v. Banc of America Securities, LLC, 691 F. Supp. 2d 448 (S.D.N.Y. 2010), U.S. District Court Judge Shira A. Scheindlin of the Southern District of New York warned litigants of this pivotal obligation in the face of reasonably anticipated litigation; she also went on to provide keen insight into how litigants should use litigation holds to execute their duty.

The case focused the attention of business leaders on the legal hold process – wherein information that is routinely destroyed is maintained because of its relevancy to reasonably anticipated litigation. As discovery duties with respect to electronically stored information (ESI) continue to evolve, and as ESI itself steadily mounts, organizations need defensible, cost-effective and feasible solutions to their data-preservation obligations.

Applied Discovery, through its partnership with Zapproved, stands ready to help. We’d like to introduce to you Legal Hold Pro, an automated legal hold process that will ensure you can carry out your preservation duties in line with legal standards: reasonably, in good faith and proportionally. Applied Discovery’s Legal Hold Pro also offers substantial savings in time and cost, and above all, you can implement this software today – in less than an hour.

Legal Hold Best Practices

Procedural Best Practices

It’s often the cases that fall into a gray area that ultimately shine the brightest light on tricky legal issues, perhaps because the facts in those cases challenge judges to lay compelling groundwork in support of their difficult decision. Such were the circumstances when Judge Scheindlin seized the opportunity in Pension Committee to set forth parties’ reasonable procedural obligations with respect to issuing legal holds. Its progeny has tweaked and clarified certain requirements, but Pension Committee remains luminescent for parties seeking to understand the correct steps to executing their preservation duty. The following best practices emerged from Pension Committee and subsequent case law.

  • Establish, communicate and follow a preservation policy. Proactively instituting a process and consistently following it can help prove reasonableness and good faith should the need arise.
  • Issue timely, written legal holds to key players. Organizations that reasonably anticipate litigation should disseminate legal holds in writing to personnel likely to have relevant information that the organization must preserve.
  • Legal holds should communicate expectations clearly. After considering factors such as the nature of the impending litigation and the accessibility of information, instruct recipients clearly and in detail on how to properly undertake preservation.
  • Confirm receipt and understanding of legal hold notices. Ensure that recipients receive and know how to comply with their preservation obligations.
  • Engage IT personnel. Organizations’ IT departments are often actively involved in the litigation process. Keep these personnel in the loop with respect to the duty to preserve and appropriate legal hold specifics.
  • Update legal holds as necessary. Develop a process to check for updates and apprise legal hold recipients of any developments affecting the duty to preserve.
  • Remind recipients of legal hold obligations. Monitoring compliance with legal holds is essential; thus, periodically communicate with recipients to ensure the continuing preservation of appropriate information.
  • Trust, but verify. Part of managing a successful legal hold requires confirmation that recipients and IT personnel are in compliance. Organizations cannot meet their preservation obligations without the cooperation of the individual employees in possession of information.
  • Document, document, document. Keep track of all steps taken with respect to legal holds, including issuance, recipients, instructions and follow-ups.

Scope of Preservation Best Practices

Beyond the legal hold processes that Pension Committee and its progeny helped define, questions remain regarding the scope of information that organizations have a duty to preserve. As the volume of data in the possession of organizations continues to explode, and as the costs associated with retaining such data simultaneously increase, organizations question how to preserve ESI and avoid the risk of spoliating evidence and potential sanctions.

Nearly a year after Pension Committee, Judge Scheindlin participated in the Georgetown University Law Center’s Advanced E-Discovery Institute, where she spoke about the case and offered additional insight into how litigants’ efforts to follow a reasonable legal hold process may be judged. “Proportionality is the word of the day,” she stated. “We do want to be proportional every time when judging the efforts that litigants have made.” Thus, despite that “if it‘s a smaller case with less documents we don‘t need to expect a Cadillac treatment,” what exact conduct constitutes “proportional” efforts remains somewhat murky.

Nevertheless, organizations can engage in certain practices, such as the following, to preserve the right data while limiting their costs as much as possible:

  • Challenge “scorched earth” tactics by employing smart preservation strategies. Organizations can reasonably limit the cost and burden associated with data preservation by intelligently applying their legal holds. Consider subject matter, number and types of data sources, types of information and how it is stored, and relevant time frames. Eliminate redundancies. Look to balance conduct against the risk of spoliation consequences, such as sanctions.
  • Know your data. How and why is the organization’s data created and retained? Armed with these answers, create a data map so you know where your organization’s data resides. Where there are gaps, seek guidance from experts in records management. A sound information governance policy can help control the amount of unwanted or unnecessary data burdening an organization.
  • Defend efforts that promote proportionality. Counsel should strive for proportionality and defend such decisions in responding to a duty to preserve. To boost the defensibility of such proportionality decisions, counsel should ensure they are applied consistently and in cooperation with the opposition or with the approval of the court whenever possible. Well-reasoned and communicated processes are the most defensible.
The Demand For Reliable And Affordable Legal Hold Processes

Competing forces – the magnitude of executing a defensible legal hold and the prohibitive costs of undertaking it – have driven the development of an option that is both more reliable and affordable.

The inherent disadvantages of manual legal holds are becoming simply too risky in the wake of cases like Pension Committee and in light of the growing amounts of ESI organizations have in their possession. First, manual legal holds are by definition inconsistent, as they depend on humans for their execution. Not only are humans prone to error, but employees also come and go, and even if they remain, they generally have job responsibilities beyond managing a legal hold process that divert their attention. The steps involved in legal holds are tedious and exacting, qualities that tend to invite errors and omissions.

Moreover, undertaking manual legal hold processes is expensive: it consumes far more organizational time than most realize. Critical steps in executing a legal hold in accordance include numerous confirmations, explanations, notifications, updates and reminders. And, exhaustive documentation of all the aforementioned steps is necessary too. In addition, the risks associated with inadvertent or mistaken deletion of ESI have led many organizations to overpreserve and overcollect duplicative and irrelevant data. This response to the fear of spoliation is understandable, but it is also extremely expensive.

Through automation, organizations can increase the consistency, accuracy and completeness of their legal holds, all while achieving cost savings by better using their staff’s time and preserving the right data. Applied Discovery’s Legal Hold Services give organizations the capability to institutionalize their legal hold knowledge: information is in one place and accessible to those who need it. With such a technology-supported process, business leaders can easily answer questions such as the following:

  • What custodians do we typically send a hold to when this type of matter arises?
  • What parts of the organization are subject to holds most frequently? and
  • Is an employee who is about to leave the company subject to any active holds?

Capturing this information makes the legal hold process repeatable, comprehensive, transparent, and, above all, defensible.

Moreover, Applied Discovery’s offerings, including Legal Hold Pro, allow organizations to reduce costs by retaining potentially responsive information in a manner consistent with “the normal course of business” rather than searching for and holding it or collecting it and preserving it. This “preserve-in-place” technology prevents not only the unnecessary replication of data but also incurring superfluous collection and processing costs. It makes it likely that discovery can be based on a tiered or sampling basis by creating an environment where a legal team can use targeted, just-in-time collections. Such an approach saves significant amounts of time and money. In fact, a recent study conducted by the developers of Legal Hold Pro to determine the economic benefit to organizations found that by implementing an automated process, organizations could reduce time associated with issuing and tracking hold notifications by an estimated 76 percent. Accounting for labor costs alone, Legal Hold Pro software offers a first-year ROI of over 260 percent, and as the number of legal holds adds up year over year, the economic impact will increase.

Using Applied Discovery’s Legal Hold Services

Applied Discovery’s legal hold services include the following:

  • Expert consulting on legal hold strategy delivered by leading industry consultants;
  • Hands-on approach to preservation led by Applied Discovery’s experienced data collection and forensic teams; and
  • Comprehensive implementation of legal hold with Legal Hold Pro™.

By working closely with its clients to thoroughly assess their needs, Applied Discovery can leverage its in-house data collection and forensic experts, world-class support and project management, and experienced discovery consultants to tailor a legal hold solution that delivers accurate, defensible and cost-effective results.

Special Sections: 
Dodd-Frank Two Years Later: Part II
Section Subtopic: 
Service Providers
Other Topics: 
Web Topics: