Utilizing A Litigation Management System To Establish A Solid Discovery Plan

Wednesday, December 1, 2004 - 01:00

There's no escaping the fact that virtually all antitrust cases, and
indeed complex litigation of any kind, revolve around documents, often tens of
thousands of them in both paper and electronic format. And plaintiff's counsel
will want every one of them. When confronted with vast and invasive discovery
requests, the importance of establishing a solid discovery plan cannot be
underestimated. It's crucial to make sure the required documents are presented
and protracted; it's equally crucial to making certain cost of doing so does not
cripple the budget. However, establishing a comprehensive discovery plan for
litigation involving a multi-jurisdictional corporation is no easy task.
Corporations typically employ hundreds of employees and store information in a
variety of locations and a myriad of formats. Under the traditional discovery
rule requiring each party to bear its own discovery costs, opposing counsel will
no doubt seek to obtain the maximum amount of information possible. Corporate
counsel must be prepared to respond to such requests in an organized and
consistent fashion. A failure to do so could result in a substantial waste of
corporate dollars, or more importantly, a failure to meet the corporation's
discovery obligations, opening up the possibility of sanctions.

Know What You Have

Corporate counsel needs initially to ensure that a quality electronic
litigation management system is in place to store and organize discovery-related
materials. These systems are indispensable in coordinating complex discovery,
containing features that allow counsel to search across document collections,
review and notate stored materials, and create case outlines and timelines. The
litigation management system is, in essence, the storage backbone for a
comprehensive discovery plan. By placing all case information in one searchable
electronic database, information is easily locatable and retrievable. Such a
system does away with time-consuming delving through endless pages of paper
documents on a regular basis.

However, to utilize a litigation management system efficiently, counsel
or staff must be trained in its use. These systems are too complex to utilize
effectively without training, and any attempt at such use can jeopardize the
discovery plan. If counsel is not experienced with a litigation management
system, a third-party litigation management consultant or vendor should be hired
to perform this task.

Know What You Must Disclose

The next step in establishing a comprehensive discovery plan is to
develop strategies to narrow the scope of the opposing party's requests. Typical
approaches include objections based on relevance and burden. Corporate counsel
should also be willing to reach out to opposing counsel to see if an agreement
can be reached limiting the extent of discovery. Any agreement of this type
should be in writing and presented to the judge. So-called unwritten
"Gentlemen's Agreements" should be avoided, as they are a dangerous practice,
capable of wreaking havoc in litigation when - as inevitably occurs - one side
elects to break the agreement or the parties find that interpretations differ.
All documents generated during this phase of discovery should be stored in the
litigation management system for future review and use. Since judges do not care
to be involved in day-to-day discovery matters, these documents serve as proof
of the corporation's good faith cooperation should disputes arise.

When designing a strategy to curb discovery, corporate counsel should be
careful not to underutilize the burden objection. While modern internet search
engines make such research seem easy in plaintiffs' eyes, in fact, corporate
documents are not generally "HTML" format, and require skilled manual coding to
be retrievable at will. In light of these conflicting expectations of
electronically stored information, burden objections are more frequently finding
their way before judges. In fact, in response to the increase in electronic
discovery disputes, many jurisdictions have established rules specifically
pertaining to such disputes, and the Federal Standing Committee on Rules of
Practice and Procedure recently approved for publication and public comment
proposed amendments to the Federal Rules specifically addressing electronic
discovery. Since the majority of corporations will need to engage in electronic
discovery to locate potentially relevant information, setting forth burden
objections in this area is highly appropriate.

To prevail on burden objections, however, companies need to establish
the burden, and accordingly should be sure to prepare a study on the time
and costs involved in obtaining the requested discovery. Corporate counsel
should thoroughly familiarize themselves with Zubulake v. UBS Warburg ,
217 F.R.D. 309 (S.D.N.Y. May 13, 2003), a bellweather case which sets forth a
respected test on resolving electronic discovery burden objections through
cost-shifting.

Find Out Who Knows What

Concurrent with the previous step, the corporate counsel must locate and
interview individuals with knowledge of the allegations in the Complaint and the
whereabouts and content of potentially responsive documents. This is necessary
to investigate the merit of the opposing party's assertions, as well as to
ensure the sufficiency of document production and interrogatory responses and
admissions. Again, documents created in this stage of the litigation should be
stored in the case management system for future review and use.

At this time, counsel should also begin outlining important aspects of
the case, and create a witness list and timeline to keep track of important
persons and events. These tasks are crucial to track the progress of discovery
and serve many other important purposes, including ensuring that opposing
counsel does not attempt to "backtrack" to matters already resolved, providing
an overview of the case to other attorneys who need to become involved, and
designating important information that may be introduced at trial.

Examine What You Find

The fourth step in establishing a comprehensive discovery plan -
locating, organizing, and reviewing documents for production - can easily become
costly and disorganized if not handled properly. As noted, counsel must first
review the document requests carefully and consult with those knowledgeable
within the corporation to determine the location of potentially relevant
documents. If relevant documents reside on electronic systems, in-house staff
will need to be queried whether they can extract the data. If in-house
extraction is not possible, counsel will need to seek an outside vendor
specializing in such extraction.

Next, gathered documents must be migrated into the litigation management
system for review. For electronic documents, this typically requires a format
conversion. However, the litigation management system should also preserve the
original electronic file should the conversion remove relevant information. For
paper documents, scanning is used to convert the documents to electronic format.
Unless scanning is done in-house, counsel will need to contract with a vendor to
perform this task. Counsel should also have the vendor run the scanned documents
through optical character recognition software so that counsel can search the
document text. Because both of these approaches can inflict significant expense
in the discovery phase of litigation, counsel will need to explain to management
the benefits of conducting discovery in this fashion, highlighting the fact that
utilizing litigation management software provides a thorough and speedy review
process; permits recurrent analysis of documents through word and coding
searches; and can be reused in similar concurrent or future litigation.

A major aspect of the fourth step involves reviewing documents from the
client to determine their importance in respect to the issues at stake in the
litigation and evaluating those documents for privilege. Depending on the volume
of the documents collected, counsel may wish to hire temporary attorneys to
assist with such review. When interviewing temporary attorneys, counsel should
look for prior electronic document review experience involving the same or
similar issues. Counsel should also prepare a written document review protocol
and train the temporary attorneys on its use. This protocol should set forth the
issues the review attorneys should identify and the extent of the coding they
should perform. In order to avoid unnecessary coding of non-relevant materials,
word searches can be used to identify the potentially relevant documents in
order to reduce unnecessary client coding costs. Counsel should also use word
searching to identify documents relating to new theories as they develop,
avoiding the need to re-review the entire collection. Such a practice gives
counsel the ability to quickly ascertain the merits of new matters without
starting the review again from scratch.

Making The Drop

Once the documents are reviewed for relevance and privilege, they must be
produced to the opposing party. Initially, the parties will need to agree to the
form of the production, that is, whether the documents will be tendered as paper
or electronic media. Since the documents are stored electronically at this
stage, both approaches are viable alternatives, although the electronic approach
will likely prove less expensive than printing. However, counsel should also
evaluate whether the client will receive a tactical benefit from providing a
massive number of paper documents. Once the form of production has been
determined, counsel can utilize the litigation management system to
electronically "Bates-number" the documents; establish a record of those that
were produced, withheld, or redacted; and create a privilege log to comply with
the civil rules.

Using Your Own Data

It's exceedingly rare for a corporate defendant to win a case based on
the opponent's files, especially where the opponent is an individual. The key to
victory lies in effectively finding, processing, absorbing, and using your own
documents. The final step in establishing an effective discovery plan is to
institute efficient management practices over the vast amount of information
generated, and to prepare such information for use in resolving the dispute. As
the case proceeds towards trial, counsel should update and revise case outlines,
witness lists, and timelines. Such trial materials typically represent a good
foundation for the creation of demonstrative exhibits. Counsel should also
identify and mark potential trial exhibits from the document collection. If
settlement appears unlikely, these exhibits can be exported to an electronic
litigation presentation system, allowing counsel to display and annotate them on
a screen. Finally, to assist with the examination of witnesses, counsel should
review and cross-reference documents and deposition testimony to locate helpful,
harmful, and conflicting statements. Overall, counsel should attempt to define
the client's position as clearly as possible in order to resolve the dispute as
favorably as possible.

Closing Argument

The effectiveness of a solid discovery plan cannot be underestimated. The
ability to automate particular discovery functions utilizing litigation
management software significantly enhances discovery organization and reduces
client costs. Furthermore, such a system improves case coherency by placing all
relevant materials in one searchable location. This structure permits counsel to
easily and completely analyze the theories behind the case and construct a
position favorable to the client. Since cases develop over time, the
adaptability of an effective litigation management system permits counsel to
research new theories and modify existing theories without having to
significantly repeat work already performed. Finally, should clients be involved
in similar concurrent or future litigation, the existing database can be a
starting point for counsel in preparing the client's strategy in the new case.

Martin H. Karo is a Partner and Chair of the complex
litigation practice group of Nelson Levine de Luca &Hurst, LLC. G. Frank
McKnight is an Associate with the firm. The firm focuses on the business of
insurance and specializes in the defense of class action and other types of
complex litigation. Please visit www.nldhlaw.com.