Suppose you’ve got a business. Not just any business, however, but a state-of-the-art business. Not necessarily a business that sells state-of-the-art products or services, but a business that you run in a state-of-the-art manner. Instead of carrying briefcases full of notes, you’ve got compact flash cards full of data. You don’t even remember the cost of a first-class stamp because all of your correspondence is done by email. You don’t have boxes and drawers full of hard files around the office because you’ve got everything stored and backed-up on hard drives and servers. You don’t have a calendar on your desk because you’ve got your daily schedule synched to the Smartphone that never leaves your side. You use every possible gadget to make sure that you are doing everything in the most technologically advanced and efficient way possible.
Now, think to yourself: What happens one day when your company winds up on the wrong end of a lawsuit? Perhaps even a completely bogus, frivolous lawsuit. Even if you know that you’ll end up victorious in the end, you might find yourself bogged down in an eDiscovery quagmire once you have to turn over all of your “documents” during discovery. While you might have nothing to hide and you might want to turn over every piece of potentially relevant data possible in order to clear your name, you might not want to be the one to actually go through the effort or sifting and sorting through megabytes upon gigabytes upon terabytes of word documents, excel spreadsheets, emails, gmails, tweets, and the like.
One possible solution to the time-consuming document review process is to contract with an independent vendor who will cull through your electronically stored information (ESI) in order to satisfy your adversary’s demands. While hiring an e-discovery vendor can sometimes be the least burdensome solution, as we will soon see, it is by no means a perfect solution.
In T.A. Ahern Contrs. Corp. v. Dormitory Auth. of State of New York, the Supreme Court of New York (i.e., the trial court) expressed that hiring a vendor to sift through eDiscovery is acceptable because it is often the least burdensome, and occasionally the only practicable, way in which to satisfy a party’s complicated discovery demands. Even though hiring a vendor may seem like the best solution, you may still be thinking: “But, how much is this going to cost me?” Costs of vendors willing to provide these services can amount in the tens of thousands of dollars, and sometimes more. However, if you’re going to state court in New York, you’d probably be pleased to find out that
it might not cost you a dime.
The general rule followed by the New York court system is that the party seeking discovery should incur the costs of production. (P.S. There is authority in New York for requesting parties to seek protective orders aimed at shifting all or part of the ESI costs to the producing party). Thus, feel free to let your adversary make as complicated and exhaustive an eDiscovery request as imaginable. You can rest easy knowing that it’s likely that they’ll have to foot the bill for it.
An independent vendor, however, is far from a perfect solution to your eDiscovery woes. In Heriot v. Byrne, a mistake by plaintiffs’ eDiscovery vendor led to the production of plaintiffs’ documents that were protected by the attorney-client privilege. In the end, the court determined that it would be unfair for plaintiffs to be penalized for a mistake that they themselves neither caused nor anticipated. As a result, the defendants were ordered to destroy any remaining copies of documents wrongly provided to them or to return them to the plaintiffs. This case serves as a reminder that if you want things done right, sometimes you might want to just do it yourself.
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April 5, 2010 at 3:34 PM
Byrne seems to say that the independent vendor is the best solution, because they didn’t have to pay for it at all, but this goes hand-in-hand with one of the cases discussed a few weeks ago that emphasized the need for firms to doublecheck their production to make sure that no privileged documents were being turned over. An independent vendor with an attorney to review their work would seem to be the best decision.
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April 13, 2010 at 11:23 AM
Time and cost always factor into the analysis when deciding to use an independent vendor. For smaller companies, this is probably the better way to go. I agree with Sean, in that it wouldn’t be a bad idea to have your attorney review the documents being produced to ensure the attorney-client privilege is being protected.
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