Top Reasons Organizations Move To An On-Demand E-Discovery Service

Monday, July 2, 2012 - 08:22

The Editor presents the following report based on a webinar entitled “Top Reasons Organizations Move to an On-Demand E-Discovery Service,” which was presented June 14, 2012 and sponsored by Recommind, Inc. The presenters were Nick Patience, Director of Product Strategy, Recommind Inc., and Adam Sand, Associate General Counsel,

The webinar provides an excellent description of cloud and on-demand services and how they can be leveraged to maximize the efficiency and cost-effectiveness of an organization’s e-discovery process. Imbedded in many of these services are specific document search and review capabilities, such as Recommind’s predictive coding technology and process.

Complementing this discussion, the presenters provide compelling, real-world examples of how companies like use on-demand services. While these examples are too numerous and detailed to feature in this report, our readers are invited to view the webinar in its entirety at

Often used interchangeably to describe data management services, the terms  “on-demand” and “cloud computing” both include traditional Software as a Service applications, such as email and billing; Platform as a Service offerings, such as Microsoft’s coding tools, which are aimed at developers; and infrastructure services that allow companies to tap the cloud for scalable storage and processing cycles.

Mr. Sand kicks off the discussion with an example of the latter. uses the cloud for processing of complex DNA testing data. On a regular basis, it offloads raw numerical data to the cloud, thereby expanding access to thousands of computers without compromising the company’s sensitive data security. Multiple users perform required analyses from their remote computers, and these results are returned to the in-house system so the company can perform its core service of making ancestral matches among people in its database. Using the cloud saves the considerable expense of maintaining internal processing capacity for low-security tasks that are performed regularly.

The presenters discuss how cloud computing and on-demand services (collectively, “on-demand”), are gaining traction as solutions in the legal space, particularly with respect to e-discovery. Mr. Patience cites a technology survey reflecting substantial use of cloud computing by law firms and offers compelling statistics as to anticipated data volumes projected out to the end of 2012 – over 300,000 petabytes of data, 80 percent of which will be unstructured.

To accomplish the massive job of managing today’s e-discovery demands, Patience recommends the use of the Electronic Discovery Reference Model (EDRM) as a framework to divide the process into more manageable tasks, from data collection, to early case assessment (ECA) and production. He further outlines how on-demand can facilitate and offer competitive advantages throughout the EDRM process. For instance, on-demand is particularly effective during the analysis and review stages, which can involve internal and external resources, because it offers centralized and secure access without piercing company firewalls.

Sand follows with a discussion of how outsourced components of e-discovery are enhanced by on-demand, citing the relatively ephemeral data-management requirements of even complex, multi-year litigation as compared with the day-to-day systems required within the normal course of company business. On-demand also enables companies to outsource selected parts of the e-discovery process and optimize costs without compromising their ability to reserve critical tasks for their primary attorneys.

Based on feedback from Recommind’s clients, Patience presents three main reasons for adopting an on-demand e-discovery solution. First, on-demand eliminates equipment costs associated with acquiring hardware and software internally, and it saves the time organizations would have to spend deploying these resources. In a recent law firm technology survey, 47 percent of firms surveyed said they will be using more on-demand offerings going forward. The benefits they cite include on-demand’s simplified support and maintenance; less stress on internal systems; and substantially lower costs, for instance, for licensing and upgrades.

The second benefit on-demand offers is flexibility. Law firms and corporate legal departments need the option to adapt, and possibly even change course, based on evolving case circumstances. E-discovery projects change throughout the EDRM process, which involves a set of processes that may need to be revisited as new evidence appears or new custodians are brought into the picture. Further, some legal matters start out small but then balloon very quickly, requiring additional resources and expanded access to information. On-demand can accommodate these developments quickly and cost-efficiently.

The third benefit of an on-demand solution is that it reduces the time and cost of the actual review process – the most expensive part of the e-discovery process, particularly as it relates to e-discovery. This benefit is often facilitated by use of predictive coding technology. For example, in 2011, a global not-for-profit company engaged a nationally recognized law firm to conduct an internal investigation related to compliance with the Foreign Corrupt Practices Act (FCPA). The attorneys needed a cost-effective solution to help them discover questionable practices that may have occurred over the past decade throughout the company’s global operations. On-demand services and Recommind’s predictive coding technology cut the attorney review time down to 1,000 hours versus linear review, which would have required 16,000 hours.

Sand speaks next about the current state of the e-discovery market, highlighting the increasing preference for machine-driven versus manual review e-discovery processes. One broad point is that systems that work well for collection, and even for early case assessment, may not provide the best solution for review platforms, which require greater adaptability. Further, he sees a dramatic shift in the way courts are looking at machine-driven review. The skepticism of five years ago is increasingly being replaced by acceptance and acknowledgment of the efficiencies that predictive coding offers. In today’s world, a judge might even find it suspicious to learn that counsel spent 16,000 hours on a manual review process.

Having covered the benefits of on-demand services, the discussion turns to important considerations when negotiating a contract for on-demand vendor services. First, prospective users should be prepared to negotiate terms. Specific considerations requiring careful review include the following:

  • Will data residing in the cloud be housed in various locations, such as might be the case with a global service provider? If this is undesirable, negotiate for a U.S. location or even a specific data center.
  • What is the provider’s architectural framework, and how will data be stored?
  • While service level agreements (SLAs) tend to be standard, be sure to understand the provider’s responsibilities in the event of an SLA breach and what remedies are available to compensate for lost service, such as additional services at no cost.
  • Understand the vendor’s enterprise risk management protocols, including data retention policies that can have a big impact on litigation holds.
  • Understand how the vendor’s disaster recovery plan might affect the number of instances of company data within the system.
  • Ask for e-discovery disclosures that outline the vendor’s procedures if, for instance, a government entity demands data and classifies the request based on a criminal investigation or an issue of national security.
  • Understand the different data access levels offered for full e-discovery services versus for more limited data storage. By definition, the former includes substantial access to your data – and it’s also more expensive – but the latter may require special negotiation to obtain the desired level of access.
  • Ensure that the vendor provides a sufficient level of data security, particularly if your business involves sensitive information. Visit the cloud provider onsite, and look carefully at its infrastructure and security protocols.
  • Demand insurance coverage sufficient to handle worst-case scenarios, such as privacy breaches.
  • What additional services may be available, such as virtualization to a Windows operating system, should these be important and within the company’s budget?

One of the many compelling examples presented in the webinar illustrates the importance of understanding a vendor’s data retention policies. Viewers are asked to imagine data being uploaded to the cloud for e-discovery purposes within a single project that may last for two years. The litigation hold elapses for this particular case, and because the cloud provider has a one-year data retention policy for backups, everyone understands that the data will be destroyed in the normal course of business. Nine months after that, however, a new lawsuit arises for which the potentially destroyed data is relevant, renewing the obligation to protect that data if by any chance it still exists. This example points out the importance of many of the considerations listed above, including knowing where data resides, its lifecycle within the system and how to access it.

Some companies may decide that they don’t want their data included in the vendor’s backups at all, though they still want redundant storage. Redundant storage is necessary, for instance, should the primary data storage facility be destroyed by a natural disaster; however, backups may preserve information for a longer period than conforms with the company’s data management strategy. Companies should decide on what arrangement will work best and then negotiate for a specific configuration.

Vendor selection naturally will include input from the company’s IT department, which can vet many of the technical issues, such as virtualization and encryption, in advance. If a legal department, for instance, uses a standard protocol for encryption, then IT can determine if the vendor’s systems are compatible on this level. Companies should look for cloud providers that can tie together the requirements of their IT and legal departments, which underscores the need to develop and share an explicit list of the decision-making components, such as those just outlined.

Finally, it is critical for everyone to understand the legal risks within a company’s data set. For a company like, customer data is completely off limits, without exception; thus, IT departments must be kept in the loop and vendors must be sensitized to the particular requirements of each client company. This way, the IT departments can do their job intelligently, and the company can engage the vendor in open discussions about the full extent of its requirements.

Patience summed up the discussion as follows: data volumes have grown, and will continue to grow exponentially, with most of the data being unstructured and scattered across the Internet, mobile devices and company systems. On-demand e-discovery tools can provide a range of benefits, allowing firms and corporations to efficiently scale services to meet data management requirements, reduce costs and deliver rapid results. Of course, there is no one-size-fits-all approach; thus, companies must assess their needs and available services with a clear understanding of the issues and possible technical solutions. Choosing the right vendor can deliver maximum results with minimal risk.

About Axcelerate On-Demand

Recommind’s Axcelerate On-Demand is a client-focused solution that combines the best of technology, people and processes. As many have learned, Axcelerate On-Demand can help organizations gain early strategic insight, achieve optimal review quality and reduce the time and cost of review – without incurring the costs, maintenance and resources needed to support an onsite e-discovery solution. For more information, go to

Please email the presenter at with questions about this webinar.