Reported by Gregory P. Bufithis, Esq. and Eric Fell, Esq.

18 February 2011 — It’s been two weeks since LegalTech New York and it’s taken that long to digest most of the information we collected. We stayed an extra week after LegalTech for follow-up with interviews and product demonstrations.

As always, LegalTech can cause info-saturation (see, for instance, the reports from Gabe Acevedo and Donna Seyle on the show) so unless you have a game plan it can overwhelm you.

For new readers: LegalTech New York is the largest legal technology conference/trade show in the U.S. It’s an excellent opportunity to get hands-on practical information in all legal technology areas with 600+ vendor exhibitions and 50+ substantive programs. It really does have the most extensive gathering of vendors/products for just about every legal technology need.

It was an interesting LegalTech this year and though I spent little time at the actual event but at meetings and presentations around and outside the venue, I came away with a few observations/themes/ideas … plus one big “new new thing” – real information management (more below).

I had the chance to wear a few hats: covering the technology side as the CEO of The Posse List, meeting with our European clients as CEO of Project Counsel, and launching our new venture Project Counsel Media. And it all came together. As Goethe said “At the moment of commitment, the universe conspires to assist you”.

We had a 6-person team at the event this year. The team covered about 15 of the substantive presentations/sessions offered amongst the various educational tracks, and they conducted 40+ video interviews with vendors and participants. Those videos have started to roll out on our YouTube site and will continue to roll out the next few weeks (editing has been a task). We will also have a long post early next week on the substantive educational sessions we covered with a synopsis and links to the materials presented.

The high-point for us was our 30-minute video interview with the keynote speaker Gonzalo de Cesare (political advisor with the European Union Police Mission in Bosnia & Herzegovina) whose keynote was entitled “United Nations War Crimes Investigations – Information Management in High-Volume Legal Proceedings.” He discussed the UN’s process for managing some of the largest and most complex cases in the world with information management and e-discovery management software (all provided by industry goliath ZyLAB) for the Khmer Rouge trials, the criminal tribunals for Rwanda, and the trial involving Slobadan Milošević and the former Yugoslavia.

We conducted the interview in Mr de Cesare’s native language of Spanish and we are in the process of preparing subtitled versions with downloadable transcripts in 14 languages for presentation to the United Nations. All versions will be available on the ZyLAB website as well as our YouTube Channel and the new Project Counsel Media website. For the ZyLAB press release on Mr de Cesare click here.

So, some observations/ideas/themes from LegalTech New York 2011 as gleaned from my staff and my own activity:

1. Optimism and maturation. I got a rather “warm & fuzzy” feeling this year in that I sensed more optimism about the financial strength of the e-discovery market. Presentation events and demo-rooms were almost all pre-booked before LegalTech even started, vendors scrambling to set-up additional sessions as the event commenced. Deals were being made left-and-right (I had the privilege of watching two transactions as an undisclosed observer). As Ari Kaplan has pointed out this “measured optimism” and maturation of the market was reflected by less flashy presentations, more case studies of “what-we-have-done-for-our-clients”, how vendors are executing on innovation, etc. For my video chat with Ari please click here.  .

2. Vendor partnerships and industry consolidation. There were lots of partnerships and tie-ups announced and cross-marketing ventures, too numerous to mention. These allow a vendor to in effect “leverage the power of its partner” (a phrase I stole from Ari Kaplan, by the way). For a list of those announcements (and as an overall great source on staying current on the overall legal technology market) I recommend following the folks at Inside Legal.

And for detailed “all-things-technology” in both the specific product sphere as well as market analysis I suggest a subscription to The 451 Group.

Also, a new resource on e-discovery providers: the Socha-Gelbmann team have announced the launch of a new online service called Apersee which was created in response to the many requests they have received for a better way to search for and select e-discovery providers and products, and built on the foundation established by their Socha-Gelbmann Electronic Discovery Survey. We have reviewed the Beta site and it’s a rather interesting tool to independently evaluate which providers and products potentially match your particular needs. To access the site click here and more background information click here.

These partnerships and tie-ups often precede an eventual merger and acquisition. This comes as no surprise because it follows what is happening in other industries. For instance both Coke and its rival PepsiCo completed their respective analysis of the beverage markets and bought their North American bottlers last year along with other distributors (and brands) as a way to improve performance by cutting costs, speeding innovation, and give themselves more control over distribution. All of those elements apply to the legal technology industry as well.

3. An alignment of in-house counsel and their outside counsel with respect to e-discovery. Over the last year we have seen corporations making a serious move toward managing e-discovery and treating it as a core business practice. This is a sea change, but it something we have seen developing very quickly across Europe (for our recent analysis click here). Many at LegalTech told us they still need a major “trigger event” (litigation, regulatory review or investigation) to get the process rolling and force their in-house law departments to focus. But what was “new” or at least more evident at LegalTech this year was a greater presence of law firm litigation support managers escorting their corporate clients through vendor exhibits and presentations (as well as substantive sessions) with the focus on how in-house law departments can go through the process of deciding whether/how to build an in-house e-discovery facility.

As we discussed with a number of in-house counsel, it is a cost analysis. Where is the company spending most of its e-discovery budget (if it has one) now? Are those portions of the workflow good candidates to bring in-house?

Note: typically, processing data and review are the most expensive phases of any e-discovery project. We have found that Project Counsel’s corporate clients have determined processing, analysis, and first-pass review are the best candidates to be brought in-house from an ROI perspective.  

4. Vendors and the art of differentiation. With 6 billion e-discovery vendors (only a slight exaggeration) the continuing challenge is still “how-do-we-differentiate-ourselves-from-the-pack?” and it is difficult for the client, the customer to make the evaluation. Just stagger through 2 floors (about 8 ballrooms) at LegalTech of vendors and try to find one who didn’t offer data-collection-data-processing-early-case-assessment-subjective-review-production … and phenomenal cost savings. And it’s not easy when everybody uses the same buzz words: cull-image-duplicate-document-early-case-assessment-production, etc.  

Today the marketing buzz word is “speed” with vendors regularly throwing around impressive-sounding numbers about the speeds at which their software tools can index and search data, though these numbers often lack context. In practice, e-discovery processing depends on a number of factors, such as the computing platforms data resides on, the types of media it is stored on, and the types of attachments and associated information included in a data set.

In 2005, George Socha and Tom Gelbmann launched the Electronic Discovery Reference Model to address a lack of standards in e-discovery. By creating a common model and framework for discovery the goal was to make the process more predictable. In 2006, they launched the EDRM Metrics project to provide a standard approach and a generally accepted language for measuring the full range of electronic discovery activities. The project includes a data set that vendors can use to test their systems.

All of this led to their launch of Aspersee. My suggestion is your starting point should be the links in paragraph #2 above: use The 451 Group and Aspersee to understand/compare vendors and products.

5. And just a view words about early case assessment. Early case assessment: a favorite concept/phrase in the e-discovery world. Simply put, it’s used to refer to estimating the risk (cost of time and money and probability) to prosecute or defend a legal case by assessing a case through an initial review of documents. It’s not new. Every trial attorney has done it. Nowadays, however, the document review is much more complicated, considering the volume of documents has exploded a million-fold. Global organizations deal with legal discovery and disclosure requests for electronically stored information “ESI” and paper documents on a regular basis.

But the phrase has become overused, warped and misused. For a nice, succinct “state-of-the-art” we turned to Morgan Sheehy, CEO of Nuix.

For a link to the early case assessment article to which we referred in the video click here.

And for a link to the recent IDC update on the entire early case assessment market click here:

6. Predictive coding and automated document review. The concept is simple: systems, methods, and computer program products for improved electronic discovery. They are geared for the predictive and automated coding of identical or highly similar documents for the purpose of limiting the volume of documents requiring review and thereby increasing the overall efficiency of the document review process. And it is growing in importance in the e-discovery market. For details we went to Craig Carpenter, Chief Technology Officer for Recommind:

7. On-line e-discovery education. There has been a surge in the recognition of the need for proper e-discovery training. And the answer has been online training in e-discovery law, training that harnesses the new capacities of technology and the Internet, yet still preserves the best interactive elements of the traditional legal apprenticeship tradition. This kind of online training can fast-track the knowledge base and skills of a few technology-minded lawyers in every law firm. It is no substitute for traditional in-firm apprenticeships for the few firms that have the requisite knowledge base. But it can help. Attorneys who spend the time and effort to be trained online can then more quickly acquire the full skills required for competence.

Two of the biggest proponents of the need for a change in e-discovery training are Ralph Losey and Jason R. Baron. We had time for an informal chat with both of them:

And for a link to Ralph’s program click here.

Very shortly The Posse List will be rolling out a special offer (for our promo click here) to its members for Ralph’s program, and Project Counsel will be doing the same for its European membership base.

To join the U.S. list send an email to list.subscription@theposselist.com and we’ll subscribe you.

To join the European list send an email to membership@projectcounsel.com and we’ll subscribe you.

8. Cloud computing and e-discovery.

It was a fairly large part of the program at LegalTech, and much discussed at the sessions. In our post next week that covers the substantive educational sessions we’ll provide some links.

But for a good summary of what cloud computing and e-discovery is all about here’s my chat with Steve D’Alencon of CaseCentral:

Also interesting was my chat with some of the International Data Corporation folks I met during the show and their recent report on the over all cloud computing market. The steady rise in popularity of cloud computing means the technology is about to reach a tipping point as more businesses realize the huge benefits it has to offer. Many IT customers are expecting to manage a varied host of cloud computing technologies in the near future. And, it appears that this flexibility, which allows businesses to mix a variety of private, public and hybrid cloud computing solutions, is only adding to the technologies popularity. IDC believes that over the course of the next few years, the worldwide cloud systems management software market is set to undergo massive growth. The firm believes that by 2015 the industry will be worth $2.5 billion.

The rapid growth will be down to the increased need for automation and integrated system management solutions that can optimize the performance of relatively disparate technologies. At the moment, debate over whether to use public or private cloud computing technologies is a major oversimplification of the situation. According to IDC, firms are not willing to part company with legacy equipment until they have seen a concrete return on investment. Therefore, cloud systems management software will be required to make increasingly complex infrastructure manageable – hence the expected growth in the marketplace.

Interestingly, according to IDC, last year 70 per cent of the world’s cloud computing management software was deployed on private infrastructure. This figure is likely to change, however, when major issues – such as privacy and security – are dealt with by public clouding computing providers. And that still remains the biggest issue: the major concern for businesses deploying cloud computing technologies is security. IDC says that data leakage and outright theft weighs heavy on many chief information officers minds and, as a result, many companies are attempting to plan ahead when it comes to security solutions for cloud computing.

We’ll go into this area in more depth next week when we discuss the substantive programs at LegalTech.

9. Those fabulous folks from IBM, technology … and my big take-away this year: what “real” information governance is all about. Technology. It never ceases to amaze. Just look at this week’s over story in The Economist on the manufacturing technology that can “print” a Stradivarius … and it plays beautifully.

Much attention was focused this week on IBM’s Deep Blue computer defeat of the “humanoids” on Jeopardy! (see story by clicking here). But my experience with IBM goes well beyond that. In December I attended the IQPC e-discovery conference in Munich. Going on at the same time was a software developer mini-conferences on semantic technology, virtualization, media, etc. with Google, IBM, Microsoft, Thomson Reuters and others in attendance. I was able to skip out of IQPC for a bit and attend a few sessions and grab a dinner with some folks (my CTO is an ex-Google employee and gets these invitations all the time; always best to tag along).

Search technology in the e-discovery/litigation game is a bit different than the search/semantic technology field I follow and am involved with in the web and media world and which I recently covered at LeWeb. The e-discovery folks are somewhat wrapped up right now in artificial intelligence, predictive coding, non-linear vis-à-vis linear approach to the review of document databases, etc.

What these folks are doing with search is an eye-opener. Of course with $8 billion R&D budgets, why not. Themes/discussion: semantic search, metadata, semantic web, ontology, BI 2.0 (which has been retagged “advanced analytics” of late), etc., etc. Just a sample of something I saw: IBM has this analytics that identifies the “alpha” individual in its customers’ calling circles — those people who’d be most likely to take other customers with them should they switch carriers — so that it can cater to those individuals. They also have text analytics they apply to all forms of social media to “detect sentiment” (not just chase keywords) in order to gauge customers’ reactions to brand advertising and then adjust marketing channels and messaging accordingly. It’s industry-specific — healthcare, insurance, telecom, consumer goods, etc. – and they are in the process of applying it to the litigation world.

The IBM analytics are quite amazing. The various programs can integrate gigabytes, terabytes, or petabytes of unstructured data from web-based repositories, collect a wide range of unstructured web data stemming from user-defined seed URLs and extracts/enrich that data using unstructured information management architecture. While its purpose is to leverage unstructured data strategies/support decisions (business intelligence) its application to text analytics for litigation is a step away.

But these “advanced analytics” are not lost on several e-discovery involved vendors and companies we met with at LegalTech. Today’s e-discovery is more focused on the regulatory and investigative side of a business, less the litigation side, where managing e-discovery and information must be part of the core business practice. This is a sea change, but it something we have seen developing very quickly with all of our corporate clients. And some of the forward thinking vendors understand this. ZyLAB certainly “gets it”, as does Recommind, and Ernst & Young and Nuix and CaseCentral. But the one to watch is FusionLegal who made numerous presentations at the show.

The mantra — very simply put — is this: investigations are a unique business process where a company puts unstructured corporate data through a comprehensive analysis and classification process, adding a wealth of “contextual” metadata to documents. These can be leveraged for initiatives outside of the individual immediate case but rarely ever are. This is not a “one-off” situation. Corporations rarely take time to see it is part of a matrix. A corporation needs to couple the investigation process with advanced data analytics to create a new quantum of analysis to help make informed decisions about the future and thereby drive performance and lessen risk. They can learn from the past. The technology to do so is out there. A corporation will finally be able to exhaust the potential of that technology and the discovery/investigation process to deliver a real ROI, especially companies that exist in highly litigious and highly regulated industries. It is more than just cutting costs. It is taking that past, all that “contextual” metadata and improving performance.

I will have more after my meetings with FusionLegal and other vendors in London in the coming weeks.

I’ll end with my informal chat with Mary Mack and Johannes Scholtes of ZyLAB who do a nice job of putting together all the main elements of world-wide e-discovery and who, as mentioned above, provided Gonzalo de Cesare the information management and e-discovery management software he used for his war crimes trials.

For more information or questions about The Posse List  contact us at manager@theposselist.com

27 August 2010 — The Posse List team was in Las Vegas this week at the annual International Legal Technology Association (ILTA) conference, led by our Chief Technology Officer Scott Madsen.   It is a four and a half day event with a packed agenda and we find it to be the best event of the year (and each year seems to have a tsunami of legal technology events) because its educational content (the educational content is entirely peer-developed) crosses 50+ areas of the law and technology through 160 educational sessions.  As attendees will attest it has become  THE place to further your professional development,  and make valuable connections.   To get an idea of content here is this year’s agenda (click here).

Plus the exhibit hall featuring over 150 key vendors to the legal market.  There was a slew of vendor announcements at ILTA this year and our colleagues at InsideLegal put together a list with links which you can access by clicking here. 

Note:  we interviewed the folks from InsideLegal and we’ll have that interview next month, but just a few notes.   InsideLegal  is an online legal community and insider’s guide to doing business in legal technology, and a
information resource for anything related to legal technology research, surveys, law firm innovators, vendor executives, industry statistics, etc.   They have been producing ILTA’s vendor education program (click here) since 2004 and have worked closely with industry media on assembling panel discussions and educational programs for vendors.  They produced the program again this year and are presenting the findings of the 2010 ILTA Member Technology Purchasing Survey (click here) which highlights what ILTA law firm members are spending on technology an what applications and services they are implementing and planning to buy.  

The ILTA 2010 theme was “Strategic Unity”,  a concept that resonates the need for law firms and law departments to unite their technology with the practice of law. These disciplines must come together as never before in order to survive and thrive in the future. Conference sessions were developed around this concept,  offering attendees ideas and options in creating unification strategies in their own organizations.

But there seemed to be two other major talking points on the floor of the conference: (a) the consolidation taking place in the e-discovery market: Altegrity acquiring Kroll; Autonomy acquiring CA’s Information Governance division, AccessData acquiring Summation, etc. and (2) the integrated approach to e-discovery so many vendors are striving to accomplish.

And as always at these conferences there is too much to do, too many people to see.   We interviewed a great number of vendors and speakers at the conference and those in-depth interviews (text and audio) will post  after Labor Day when we continue our e-discovery “thought leaders” series (click here).   But just a few highlights:

*  Autonomy, ever onward and upward, unveiled its new end-to-end, meaning-based Risk Management platform for law firms using IDOL (one of its products) to deliver multiple risk management modules from a single intelligent platform.  It combines Autonomy Client Intake, Conflicts Manager, Legal Hold, Records Manager and Supervisor with IDOL and as a result automatically understands the inter-relationships within data, and monitors and apply policies against all communications channels.  As a result, law firms can transform legacy and manual risk management processes and reduce the cost of owning and maintaining multiple point solutions.  Combined, the modules manage compliance with regulations and ethical rules as well as meeting client requirements for data security, and responding to requests from regulators and courts.  Autonomy says this is the first platform that automates the time-consuming risk management process.   We’ll have more next month with an in-depth interview with Deborah Baron, VP Legal and Compliance for Autonomy.

*  CaseCentral introduced its ”Review Service Providers Certified Partner Program” (RSP).  The program was developed in response to the growing demand from lawyers, legal experts and service providers for more efficient solutions to expedite the document review process. The RSP program provides the training and tools needed to offer clients a one-stop shop for initial document review using the RSP’s review services bundled with CaseCentral’s on-demand single matter and multi-matter, multi-party eDiscovery review software. Certified partners can now offer all-inclusive reviewing services based on a pricing model — per hour, per document or per gigabyte.   We’ll have an in-depth interview next month with several folks at  CaseCentral.  

*  eTERA Consulting  is a company that keeps making a larger and larger presence in the data management field.  It was recently named to the Inc. 500 list, an exclusive ranking of the nation’s fastest-growing private companies.  It is a leader in “early information assessment” (EIA) and the company will be making a full presentation on EIA at the Chief Litigation Officer Summit on September 12-14 2010 in Las Vegas.    They did a nice job at this conference via a presentation on the highly-charged topic of electronic discovery economics.  Dan Junk (newly arrived at eTERA and formally a managing attorney at Simpson Thacher and Bartlett where he was responsible for coordinating all national defense counsel in tobacco litigation throughout the U.S.) kept to the ILTA theme of “strategic unity”, the integration of technology with the practice of law.  It is a company where the pieces just seem to be falling into place.  Next month we’ll have an interview with Scott Holec, eTERA’s President.

*  We had a chance to hook up with “social media guru” Rob Robinson who is back at Orange Legal Technologies.  Orange LT just continues to experience phenomenal growth with another bang up quarter.  The company thinks this accelerating growth is a direct indicator of increasing client desire for complete, integrated, and Software-as-a-Service delivered electronic discovery services, something we have commented on numerous times this past year.  Orange LT has ”OneO® Discovery Platform” which has the ability to deliver online analytics (early case assessment), processing, and review from the security of a hosted centralized repository.  Posse List members will remember Orange LT supported the joint defense counsel in one of the largest cases ever filed by the S.E.C. — United States v. Robert Allen Stanford, et al.  And through Rob’s expertise they still have the best slideshare presentations any vendor has produced such as Rob’s ”meet and confer” presentation (click here).

*  And speaking of cloud computing and Software-as-a-Service vis-a-vis e-discovery … there were 8 presentations.  We will provide all of that material next month when The Electronic Discovery Reading Room launches our new web site on the cloud and e-discovery, sponsored by Autonomy, CaseCentral and Microsoft. 

*  Recommind knocked the socks off the conference when they announced huge growth with its Axcelerate On-Demand solution, with revenue during the past year increasing 961 percent and new cases jumping by 425 percent.  They are the leader in predictive information management and we believe they are the e-discovery industry’s only on-demand solution with predictive coding  and  predictive  analytics  technology.  Next month we will have a follow-up to our earler interview with Craig Carpenter (click here)  and discuss their advances in Europe where they have become a major player.

Other coverage of ILTA

There was some excellent coverage of ILTA this year by our colleagues.  The conference wrapped up at 12 noon today (Las Vegas time) so we suspect there will be more wrap-ups, commentary over the weekend.  Here are some links to some of that coverage.  We’ll add to this list over the weekend best we can:

*  InsideLegal coverage can be found by clicking here.

* Christy Burke of Legal IT News has a series of posts audio posts from the conference which you can access by clicking here, clicking here and clicking here.

* Barry Murphy’s eDiscovery Journal  has some excellent coverage and you can access it by clicking here.

*  Bowtie Law’s ReCap of ILTA 2010  which is here.

Reported by:  Alexis Gambetta / The Posse List 

There were multiple sessions covering early case assessment (ECA) so we’ll summarize a few of them.  We followed the  General Counsel Track and attended “Data Retention Plans and Early Case Assessment-Moving Towards a More Effective System In-House” which was sponsored by Merrill Corporation.  

We also attended the session “Advanced Discovery Analytics and Early Case Assessment” sponsored by Deloitte.

And we had an opportunity to chat with the StoredIQ team who are a bit of an expert in intelligent information management and e-discovery technologies and have (in their words) “revolutionized” ECA.   But they have very interesting technology and a unique approach and they were open to a long chat so we’ll start with them.

So here’s the skinny.  The vast majority of legal cases are settled before ever going to trial.  One of the one of the most valuable and indispensable techniques used by corporate counsel is early case assessment (ECA).  The only argument remaining:  how early it should occur – as early as the initial data gathering at identification and collection, or just before review but after processing?  Or maybe when it is still at the dispute stage?

As Ursula Talley (Vice President of Marketing for StoredIQ) explained “using ECA, legal counsel can assess the merits of a dispute, formulate a legal strategy and make decisions concerning the matter before the costly process of taking the case to trial begins”.   But traditionally ECA occurs close to the review stage of the e-discovery process since it requires that data already be processed and loaded into a review system.  And if you are a contract attorney waiting to begin that review you know the galacial pace of e-discovery:  counsel first determines who is involved (custodians), then preserves and collects their data so that the initial analysis and review can begin.  Maybe.

Expensive, inefficient and prolonged.  Why?  Because collection and preservation involves manual, forensic copying of the custodian’s hard drive and a complete data dump of the custodian’s archived email and documents into a central repository.  Only then can processing and analysis be performed to ready the data set for a first pass review. 

StoredIQ refers to performing ECA “in the wild” meaning where the data natively resides, and the need to have the ability to perform incremental collections. This eliminates the need to repeatedly collect the same data from custodians that are frequently subject to e-discovery requests. 

They have a product (surprise!) to address all of these issues and the product is called  StoredIQ Analyze Anywhere.   In brief: it enables ECA prior to preservation and collection, without requiring the movement of data from where it natively resides. This powerful ability to perform early case analysis on data “in the wild” to give legal counsel the ability to assess the merits of a dispute, formulate a legal strategy, etc., etc.  The goal is to make decisions concerning a legal matter significantly faster than traditional ECA.  What you are doing, in effect, is conducting ECA at the earliest stages of e-discovery without having to migrate ESI from various sources into a centralized repository. 

The interesting part is that StoredIQ has a data classification technology so that the business context of data in its native location is not only available to the ECA user, but is also captured and pushed downstream to traditional review tools enabling a more contextual review experience. 

This is important because as we learned at the Merrill Corporation session the ability to perform in-place ECA must be complemented by an e-discovery workflow that provides a simplified and efficient way to cull potentially matter-relevant data.  You need to process and analyze large initial data sets with user-friendly analysis features to help make sense of a mass of information.   

The Merrill panel was moderated by Daniel Pelc of Merrill and included Wendy Curtis, Esq. (Special Counsel, Orrick, Herrington & Sutcliffe) and Paul Weiner (a shareholder with Littler Mendelson).

The panel started off with a definition of early case assessment as follows:

Early case assessment can be defined as the following: “the implementation of litigation analysis and management protocol that provides for the assembly and review of appropriate information on an expedited basis (30‐90 days) in order to provide a preliminary assessment of the case and the optimal method for proceeding.”

They also discussed that the technology behind ECA has changed drastically over the past years. The number of competitors has risen and partnerships between ECA vendors and providers within the ECA vertical has exploded.

This was the most interesting aspect (for me) because the panel went through the beginnings/sources of ECA and search and put it all into perspective, explaining its development being from two sources:

The Legal Concept:  FRCP 34 includes electronically stored information (ESI) in its definition of a document.  Counsel must “scope” or “assess” the size of their client’s relevant ESI that must be produced in any given case.  See, for example, PhoenixFour, Inc. v. Strategic Resources Corp., 2006 WL 1409413 (S.D.N.Y. May 23, 2006) (click here).  In order to determine what documents are relevant, counsel must cull and apply search terms to client’s data to produce rlevant documents. Large data sets were first processed, culled and then searched, which was very costly.

The Technological Concept:  Client’s data was (and is) unstructured.  Client and counsel had difficulty locating all relevant documents in a case.  Costs were high to comply with discovery obligations.  ECA tools, originally created as part of  records and information management (RIM) systems were used to structure and capture client’s data and/or locate, via culling and search terms, to find relevant data prior to processing.  Result: only relevant documents processed and reviewed = Large cost reduction.

So these early ECA methods left you with:

Processing side:  untargeted custodian interviews/untargeted data identification/untargeted preservation and processing/“brute force” review/no lasting value to case

Technology sde:   limited culling and searching capabilities over limited number of repositories/keyword searching only (no concept searching tools)/limited or incomplete data clustering

So that brought a new “proactive” approach to ECA resulting in:

Process Driven (Strategic): RIM/Document Retention Plan (DRP)/e-discovery Response Plan (EDRP) including litigation hold policies and procedures/leverage existing DRP and EDRP to prepare for and conduct ECA

Technology Driven (RIM and Analysis):  leverage existing technologies (RIM technologies, dynamic Data Mapping, and embedded or overlaid ECA tools) to prepare for and conduct ECA/targeted preservation and review thru data sampling, analytics and metrics/preserve, hash and collect relevant data/establish defensible audit trails and logs

And the big thing was search methodologies of which there are now a gazillion.  Ok, they told us about 15:

Boolean searches (and, or, not)

Wildcard searches (*auto*, *tion)

Proximity searches

Thesaurus/Synonym search

Fuzzy searching

Stemming

Statistical searching

Conceptual searching

Content-based searching

Topical searching

Weighted relevance searching

Adaptive pattern recognition

Associative retrieval

Natural language or non-boolean retrieval

Clusters of related phrases

The problem with searches, though, as the panel warned was the result.  Quoting Sedona:  “Sedona: “The use of search and information retrieval tools does not guarantee that all responsive documents will be identified in large data collections, due to characteristics of human language. Moreover, differing search methods may produce differing results, subject to a measure of statistical variation inherent in the science of information retrieval.”

The panel moderator (Daniel Pelc of Merrill) gave us the entire Powerpoint presentation which includes all the notes and slides and it is a treasure trove of information on ECA, search, and more.  You can access it by clicking here.

Postscript:

The StoredIQ software was extremely interesting to us because while the company was flagging it as early case assessment software the reality is that the ”in the wild” approach actually means you can analyze your situation well before preservation and collection, without requiring the movement of data, from where it natively resides.   And this means, says Ursula, you have the ability to assess the merits of a dispute before it event becomes “a case”.   StoredIQ is in the vanguard of companies like CaseCentral and eTERA Consulting who are moving beyond (off?) the left side of the EDRM into early information assessment.

We’ll have an in-depth interview with Ursula later this month and you’ll learn more about  the ”in the wild” approach.

Steve d’Alencon is as vice president of product management and marketing and Chief Marketing Officer for CaseCentral.  He is responsible for leading go-to-market programs for CaseCentral, including product management, demand generation, public and analyst relations and marketing communications. 

And there are few folks in this industry with his pedigree.  He is a product management and marketing executive with more than 20 years of experience at top enterprise software and high technology companies, including running his own marketing consultancy in Silicon Valley.   Prior to CaseCentral, Steve was vice president of product marketing at Kazeon Systems, where he transformed its brand from a storage management company into an e-discovery product and solutions leader.   During his tenure, the company’s e-discovery and overall revenue grew significantly and it received recognition from ESG, Forrester, Gartner and IDC as being a leading product for in-house proactive and reactive eDiscovery in response to litigation, information security and privacy, corporate investigations and regulatory compliance requirements.  

We caught up with Steve at the ACC Annual Meeting in Boston last year, and then in New York at the recent IQPC eDiscovery conference. 

TPL:   Last year was a big year for CaseCentral.  It was selected as a “2009 Trend-Setting Product” by KMWorld Magazine due to the popularity of your early case assessment product; you led all vendors with the largest gain in usage by Am Law 200 law firms in the 2009 Am Law Tech Survey; and you attained Safe Harbor Certification.  But most important: your e-discovery cartoon series “Case in Point” was one-year old in October.  Which brings up marketing.  And branding.  The “Case in Point” series is brilliant and gives you so much industry recognition.  How did that start? 

SD:     Thanks.  But of all the things you focused on it had to be the cartoon?  Well, a brief history of the series:  Chris Kruse and I were having a discussion in mid-2008 about how we could start a creative marketing program that would improve CaseCentral’s brand awareness without being a “me too blog” or other “me too program.” He said, “Hey, I know a cartoonist, maybe we could start a cartoon?”  And ‘Case in Point’ was born.  We spent 3 months coming up with the concept, the name and the frequency.  The cartoon was launched at the 2008 ACC Annual Meeting and has been running weekly for about 67 weeks now.  I work closely with our cartoonist, Tom Fishburne, to help him turn industry ideas into funny cartoons.  It’s harder to be funny every single week than most people would imagine, but I think we have a good track record and we’ve developed a great, worldwide audience.  Our readers also supply us with some fantastic real-world ideas. 

TPL:   Thanks.  We always wanted to know.  Now, onto more important things.  What does CaseCentral do, in a nutshell? 

SD:     Ok, in a nutshell.  CaseCentral is the leader in secure, on-demand software for corporations and law firms to simplify and take control of eDiscovery.  The CaseCentral eDiscovery platform integrates collection, early case assessment, processing, analysis, review and production capabilities, enabling customers to succeed with a single matter and seamlessly migrate to multi-matter, multi-party support within the same software platform.    

The benefit?  CaseCentral enables repeatable, defensible and measurable business processes that significantly reduce eDiscovery risk, cost and time. In late 2008, CaseCentral built and delivered the industry’s first process analytics and eDiscovery dashboard upon our multi-matter, multi-party eDiscovery platform. 

Why is this important? Because CaseCentral’s process analytics and dashboard enable authorized users to receive real-time, quantitative measurement of key eDiscovery process points, providing critical insight into eDiscovery costs, trends and efficiencies. This information is vital for corporate legal and law firms alike to measure cost (per document, per matter, per law firm), efficiency (review time) and effectiveness (review quality) across one or multiple matters.

TPL:   And the CaseCentral/StoredIQ hook up.  What’s that about? 

SD:     If you use the Electronic Discovery Reference Model (EDRM) as a foundation, the announcement from CaseCentral and StoredIQ was all about creating a strategic partnership to provide clients with an integrated eDiscovery offering that ranges from identification, preservation, collection and processing of electronically stored information (ESI) through analysis, review, production and post-production re-use.  In other words, an end-to-end eDiscovery platform.           

TPL:   Ah, one development I forgot.  Last year CaseCentral debuted its “Review Service Providers Certified Partner Program” which provides training and tools for document review, using the partners’ review services bundled with CaseCentral’s review software.  A large segment of membership/readers are contract attorneys and/or involved in the review/production (“right-side”) of the EDRM.  

SD:     The CaseCentral RSP Certified Partner Program combines CaseCentral’s industry-leading eDiscovery platform with certified high-quality, low-cost domestic or offshore document review services offered by the RSP Partner, for example Cobra Legal Solutions or Compliance, LP. Within the program, projects can be quoted using three different pricing rates: per hour, per gigabyte or per document.  The pricing model creates informative pricing comparisons to provide clients with the most economical option available.  We have a number of RSPs with whom we have successful engagements and we’re always looking for more. 

TPL:   Early case assessment (ECA). That seemed to be the mantra in 2009.  And everybody seemed to have a product for it, was developing a product for it, wanted to have a product for it.  We all know why: “ECA and e-discovery integration equals huge savings”.  But not everybody can do it and you guys became a leading light.  How?  What’s the key?

SD:     CaseCentral’s first-mover position of providing a multi-matter, multi-party eDiscovery product that enables post-production re-use of work product has put us in what we now call the “ECA market” for at least five years. Part of the answer to your question goes back to examining the definition of ECA.   In speaking to our clients and doing our own research, we concluded that the term “ECA” sometimes is a misnomer in that people think it is one, finite thing and in fact it is not. We found that the term “ECA” was being used to describe a host of activities that could literally be performed early, during, or late in the dispute resolution process. The most commonly understood ECA effort is to analyze a relatively small data set against target custodians, date ranges and key words in order to cull that data set to a much smaller, potentially responsive data set for attorney review in order to limit costs and, presumably, risk. 

However, there are a number of limitations to this approach. First, most of the current Early Case Assessment tools are designed only for the matter at hand and require a data export to another tool for active review. Also, the manner in which ECA is often performed today provides a disincentive to clients to perform other types of analysis. In speaking to several of our large clients, they were interested in performing “what if” scenario testing and risk forecasting on very large data sets that could be multiple Terabytes in size. In addition, since these clients were using CaseCentral’s multi-matter, multi-party platform, utilizing historical system metrics, such as cost and rate of review, to deliver a scope and cost estimate for a new or pending matter enabled the client to more effectively make “fight or flight” decisions. 

These client needs, plus the more basic, contemporary uses of ECA, led CaseCentral to heavily focus on re-defining ECA away from a single purpose utility and instead delivering it as part of an integrated review and production platform. This led to our announcement in June, 2009 of delivering the industry’s first integrated eDiscovery platform, including ECA.       

TPL:   Ok, news flash.  There is a myriad of software out there — review software, early case assessment software, ESI management software, etc.  How do you distinguish CaseCentral from the pack? 

SD:     You’re absolutely right.  The exhibit halls do a seem a bit crowded of late [laughing].  Ok, there are 4 things that I think distinguish CaseCentral from the pack:  (1)  CaseCentral invented multi-matter, multi-case eDiscovery software.  The benefits of this are:  (a) enables clients to standardize on a repeatable process and (b) securely stores only one copy of client data in one location; (2) CaseCentral was the first cloud computing / SaaS delivery model for eDiscovery.  The benefits of this are: (a) enables clients to bring eDiscovery “in House” via the cloud; (b) extensive collaboration (multi-party) capabilities; and (c) instant-on with no CAPEX investment required; and (3) CaseCentral pioneered the integrated eDiscovery software platform.  The benefits of this are: (a) reduces risk by reducing handoffs between different applications and (b) eliminates expensive processing and labor at each step; and (4) CaseCentral  invented Process Analytics & the eDiscovery Dashboard.  The benefits of this are it enables quantitative eDiscovery process measurement for: budget forecasting; resource governance; risk and cost oversight; managing matter timelines; and production deadlines.  Clients can do this on a single matter or, more importantly, across all cases and matters, which is unique. 

For example, it was these things and more that compelled Boeing to select CaseCentral to provide a comprehensive set of repeatable, defensible and measurable eDiscovery capabilities as the corporate standard for new legal cases. CaseCentral will be used for early case assessment, processing, analysis, review, production and post-production re-use capabilities for both single and multiple matters. 

TPL:   Last year — for obvious reasons — corporations and their law firms were searching for and selecting more cost-effective e-discovery processes and technology.  How does CaseCentral fit in the “cost-effective” bucket? 

SD:     Well, let’s start with volume.  By our estimate Fortune 1000 corporations are managing more than 500 pieces of litigation at any one time. Matters range from small investigations involving a few gigabytes of data to large-scale “bet-the-company” cases in which multiple terabytes of data are collected. As corporations take greater control of this process they need cost-effective, defensible processes and tools to secure the best possible outcome without disrupting the company’s core business.  

We realized that despite the focus on ECA, incumbent vendors are charging a premium price of as much as $1,000 per GB for just this phase of eDiscovery.  This is what led us to deliver the industry’s first integrated eDiscovery software platform and to price ECA capabilities starting at $10 per GB, not $1,000 per GB,   We also introduced an Enterprise pricing model, which provided clients with a predictable, bundled monthly cost for GB processed, GB stored, ECA, review and analysis software, productions and services. 

Lastly, “cost-effective” isn’t all about dollar cost; it is also about efficiency and repeatability.  CaseCentral invented the multi-matter eDiscovery system and it is this notion that uniquely allows clients to templatize new case creation in moments, do advanced conflict checks to avoid inadvertent productions, do global de-dupe at the time of ingestion, to re-use prior work product in new matters as appropriate and to store a single copy of a document despite the fact that it is used in multiple cases with different workflows and designations in each.  

TPL:   Does CaseCentral operate globally? 

SD:     Given that more than 80% of active litigation is in the United States, CaseCentral primarily operates in the U.S. to support our clients’ U.S.-based matters.  We support multi-national clients, as well as U.S.-based clients. 

TPL:   At IQPC in New York in December you said “E-discovery delivered via the cloud is certainly a trend for 2010 because of the efficiency versus on-premise software”.  We discussed this at ACC in Boston when we met and you said there were pitfalls.  What, exactly?  Where do you see the problems, and the benefits/solutions for e-discovery? 

SD:     First, I need to define what I mean by “the cloud.”  I like a University of California,Berkeley definition:  “Cloud Computing refers to both the applications delivered as services over the Internet and the hardware and systems software in the data centers that provide those services. The services themselves have long been referred to as Software as a Service (SaaS), so we use that term. The data-center hardware and software is what we will call a Cloud. When a Cloud is made available in a pay-as-you-go manner to the public, we call it a Public Cloud  We use the term Private Cloud to refer to internal data centers of a business or other organization that are not made available to the public.”  Personally, I feel that the definition of “cloud computing” does not usually apply to hosted applications (including ASPs) where a reseller is simply allowing you to access an application that s/he is hosting on your behalf..  In the eDiscovery industry, it is also important to differentiate services based upon public Cloud infrastructure like Amazon S3 and Google Docs.  The reason for this is that in those services, you don’t know where (including what country) your files are stored and you don’t know if you can really control document retention and destruction.  As a client, you need to know that you are completely in control of your data and a private Cloud is the only way to do that. 

In early 2009, CaseCentral delivered the first private cloud computing-based eDiscovery software platform with centralized data management and enterprise-class security, reducing the risks typically borne by clients when they transmit proprietary and confidential data outside the firewall.  CaseCentral’s platform delivers a collaborative, multi-party application platform and single-instance storage along with the industry’s only enterprise-class eDiscovery disaster recovery and business continuity protocol to safeguard client data.  

If you think of the EDRM, the moment you cross over from collection to processing, analysis, review and production, you are involving multiple resources (outside counsel, contract reviewers, service providers, etc.) that reside outside of your company and network.  Cloud-based applications like CaseCentral are built from the ground up to provide a secure, collaborative platform that allows you to manage your proprietary data in a single place while allowing 10s, 100s or 1000s of users outside your firewall to productively access that data on your behalf. 

And, as we’re talking about eDiscovery and the Cloud, a recent Gartner, Inc. report, “Predicts 2010: Regulatory Changes and Business Demands Will Drive the Long-Delayed Adoption of Legal Discovery Technology” published November 17, 2009, states “Application service providers, software-as-a-service delivery models and “cloud” solutions will dominate the review and analysis phases of e-discovery.” 

TPL:   Another thing we discussed at ACC was controlling electronic discovery using in-house resources.  Can you give us an overview on what CaseCentral is doing for in-house law departments? 

SD:     Certainly, this is one of my current pet peeves .  The notion of “in-house eDiscovery” has been over-hyped and over-marketed.  In particular, many vendors have shaped the incorrect implication that “bringing eDiscovery in-house” means the purchase, installation and on-going management of on-premise software for various eDiscovery tasks.  This is particularly misleading.  I prefer to begin with this premise of “bringing eDiscovery in-house” instead:  rather than relinquish control of the eDiscovery process to 3^rd party experts and their firms, in-house legal teams and their executives are trending toward retaining control of decision-making, creating and owning the overall process and acting as collaborative partners throughout the life cycle of a particular matter. 

It is this equilibrium that will dictate the growth and development of electronic discovery in the years to come, and not simply technology or regulatory guidelines. Those who embrace the internal/external partnership will streamline progression and enhance their readiness for favorable outcomes. 

At Case Central we bandy about the phrase, “bring eDiscovery in-house using the Cloud.”  The point of this is that adoption of SaaS and cloud computing-based software continues to rapidly increase as corporations and law firms have awoken to utilizing reliable and proven cloud-based systems for eDiscovery to drastically reduce application deployment time and receive “instant on” availability for new matters.  Initial cloud computing deployment and on-going maintenance costs are also much less than traditional on-premise software deployments.  And, using the cloud provides virtually unlimited and elastic storage of data. 

….. and there is a lot of data out there. 

TPL:   Ok, bingo.  You have hit on the purpose of this series of interviews. The “tsunami of data” as Ralph Losey says.  A volume of data (and cost of discovery) which seems to be exponentially greater by the minute.  In a nutshell, how do you help clients cope, get organized? 

SD:     Electronically stored information has a compound annual growth rate of nearly 60%.  It was estimated by IDC that by 2011, over 1,800 Exabytes of will exist.  That’s 1,024 Petabytes for each Exabyte.   And there are 1,024 Terabytes in each Petabyte.  In short, we’re all creating a lot of data!  CaseCentral’s expertise lies in dealing with the information that has been collected for a particular matter.  Our partners on the left side of the EDRM specialize in general information management disciplines and we have several strong partnerships there, including CommVault, StoredIQ and Symantec. 

Our goal for our clients is always to minimize risk, cost and time as it relates to collection, processing, data analysis, review and production.   Obviously the specifics can vary greatly depending upon the particular matter. 

TPL:   So, we now have a new lexicon, funky technology — and not necessarily technologically astute lawyers.  Are most lawyers technophobic or perhaps they don’t see technology like those of us in the industry? 

SD:     First, as Ralph and others correctly assert, technology is not a required program of study to graduate from law school.  Second, as a technology executive, I have a hard enough time myself keeping up with all of the changes and advancements in technology – business, personal or otherwise. In fact, when I stop to think about the decade that just ended, we began it without Facebook, without Twitter, more or less without blogs, without texting cell phones and, God forbid, without Apple iPhones!  So, it’s no surprise that lawyers have a hard time keeping up with technology.  Having said all of that, I prefer to view the issue in terms of a mindset.  Those who view technology as “the enemy” are missing the point – electronically stored information (ESI) accounts for more than 90% of information being created every day and, as a result, it is inevitable that this ESI will become relevant in the courtroom. 

TPL:   So it’s really a lack of knowledge, a lack of familiarity?  How do you help? 

SD:  Yes.  CaseCentral is a trusted advisor to clients from case initiation to conclusion.  We strive to do everything we can do to de-mystify technology and its implications for our clients. 

TPL:   And your technology works no matter what — potential litigation, government investigation, internal investigation, whatever? 

SD:  Yes.  Potential litigation, government investigation, regulatory request, internal investigation, active litigation, class action, etc.  CaseCentral made its name on the largest, most complex cases out there and in over 15 years of business has repeatedly demonstrated an ability to scale from small to large in terms of cases, users or data volume. 

TPL:   And what do you think is at the forefront of the discovery process, the most important thing, the biggest challenge? 

SD:     In the past 20 years, virtually every department within the corporate enterprise has undergone some sort of Six-Sigma process review and improvement except the legal department.  The fundamental objective of the Six Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction.  Many types ofwell-known software help to accomplish this kind of improvement.  Think of GL, ERP, Supply Chain, Manufacturing, CRM and other related types of software that help enterprises become measurably more efficient.  This need for measurable legal process improvement is precisely the reason CaseCentral invented its eDiscovery Process Analytics and Dashboard.  The direct benefit of this development is repeatable, defensible and measurable business processes that significantly reduce eDiscovery risk, cost and time. 

TPL:   There is a feeling among in-house counsel (gleaned from the ACC meetings we attended) that direct relationships with e-discovery vendors is best, rather than through outside counsel.  Do your law firm clients perceive this as a threat to their business? 

SD:  I think this is directly related to the notion of taking eDiscovery “in-house.”  The point is that in-house counsel are increasingly taking control of their eDiscovery processes and standardizing so they are repeatable, defensible and measurable.  The fact that in-house counsel are taking control of their eDiscovery processes does not degrade the importance of their relationship(s) and partnership(s) with outside counsel.  CaseCentral is committed to serving both inside and outside counsel and while we may have a direct relationship with inside counsel in some circumstances, we also maintain strong relationships with outside counsel. 

TPL:   E-discovery vendors have also had much success the last 2 years moving into the e-discovery space across the whole EDRM model, especially in the area of document review (the “right side”) and that success is due to the continuing move by corporations to move EDD directly in-house.  Document review is a nice piece of change.  Do you think you might move into direct document review? 

SD:     You mean actually staffing document review projects?  No, not at all.  The “Review Service Providers (RSP) Certified Partner Program”  I mentioned earlier provides the solutions to expedite the document review process.  We simply provide a “bundle” so to speak, offering clients a one-stop shop for initial document review using the RSP’s review services bundled with CaseCentral’s on-demand single matter and multi-matter, multi-party eDiscovery review software.   Our partners can now offer all-inclusive reviewing services based on a pricing model – per hour, per document or per gigabyte – that best meets their client’s needs.  But CaseCentral actually staffing?  No.  That is not our expertise. That is the expertise of our partners. 

One concluding point on this.  Outsourced review has traditionally been touted as a low cost option for document review, but locating certified attorneys or a trusted business partner has become a challenge for many companies.  Through the RSP Certified Partner Program, CaseCentral helps clients solve that problem.

TPL:   E-discovery costs are skyrocketing.  Yet much of EDD is now a commodity – and that has changed the structure of the market.  Prices are — shall we say — more predictable and probably more realistic.  E-discovery vendors have capped fees, set flat fees or worked with various forms of pricing estimators.  Have you changed your pricing? 

SD:     The challenge in 2010 for everybody — vendors, law firms, etc. — is going to be to reinvent ourselves with new economic models.  I certainly agree that the value creation of a number of EDD activities, especially processing, is suspect and the price elasticity has been appropriately impacted.  It has been broadly reported that document review comprises greater than 60% and perhaps as much as 80% of the cost of eDiscovery, which is substantially driven by the cost of humans to review and produce case documents.  This reality is a primary driver for the surge of interest in the use of technology to automate, streamline and measure eDiscovery processes. 

While most of the industry has been mired in a la carte pricing on a per GB basis, CaseCentral introduced the industry’s first “Enterprise Pricing” which provided clients with a predictable monthly cost for GB processed, GB stored, ECA, review and analysis software, productions and services. 

Some of our clients love the enterprise pricing model and the predictability it offers. Others prefer to be billed in an a la carte fashion.  It’s their choice. 

Also, CaseCentral announced today a new connector that integrates Symantec Enterprise Vault Discovery Accelerator, the leading enterprise archive, with the CaseCentral eDiscovery Platform, the leading cloud-based eDiscovery software, eliminating the need for IT and legal departments to manually export and upload large amounts of data for legal review.  Clients using the new connector will bypass EDD processing fees for data moved into CaseCentral from the Symantec Enterprise Vault, and simplify the handoff process, thereby removing risk by eliminating the opportunity for error.  The CaseCentral Connector for Symantec Enterprise Vault Discovery Accelerator will be demonstrated at LegalTech New York in the New York Hilton, February 1-3.

Oh, did I mention that there are absolutely no processing fees for data received via the new connector?  Say “hello” to the eDiscovery in the 21^st century! 

TPL:    As we discussed, the big “new new” thing all of last year — at every event we covered — was early case assessment and winnowing relevant data down to reduce the number of documents to review.  As the stats bear out, it is the most expensive part of the process.  But now we have predictive coding, plus the work being done in computer assisted review as evidenced by Patrick Oot and Anne Kershaw’s study “Document Categorization in Legal Electronic Discovery: Computer Classification vs. Manual Review “, plus the work being done by Google and Microsoft on auto-categorization or auto-coding.  Are we headed down the path to where machines can be statistically proven to be as accurate as human review?  Is the technology getting to the point where we can also winnow out the eyeballs — contract attorney reviewers? 

SD:     Like in The Terminator, War Games, The Matrix and other movies, I believe there is a human element and perspective that is important to maintain in the document review business.   But these newer technologies hold great promise for speeding up first pass review, especially on very large data sets, providing intuitive recommendations to reviewing and managing attorneys and for increasing consistency and accuracy.  CaseCentral is helping to develop and implement some of these technologies for clients, but I don’t think we’re ready to turn on the auto-pilot just yet. 

TPL:   Steve, we greatly appreciate your time. 

SD:     Greg, it is always a pleasure to speak with you.  The Posse List is one of my top 3 sources for industry information; I don’t know how you do it!

Postscript:  LegalTech is one of the premier events in the industry.  It will be February 1, 2 and 3 in NYC (for details click here) and you can find Case Central in the Exhibit Hall at Booth #311, as well as in the Gibson Suite.

Further, CaseCentral is the sponsor of the Day 2 keynote, “Perspectives on Corporate eDiscovery and Social Media,” presented by Mark Howitson, Deputy General Counsel of Facebook.  That’s Tuesday, February 2nd, @ 9am.

In the latter part of the last decade — ok, the fall of 2009 — we completed what we call the trifecta:  full coverage of three of the premier electronically stored information (ESI) and e-discovery events for the litigation industry:  The Masters Conference (click here), the ACC Annual Meeting (click here), and the Georgetown Law Advanced E-Discovery Institute (click here).

As expressed at all of these events we are in “the perfect storm”: ever increasing data volumes; more litigation and government inquiries, and skyrocketing e-discovery costs. 

And if we learned only one thing about the explosion of ESI and corporate data it was this: Craig Ball, Jason R. Baron and Ralph Losey can scare the bejesus out of you.  These guys think in terms of exabytes … and beyond.  Although Jason and Ralph try to make it more palatable by doing it to the tune of Darude’s Sandstorm (click here).   And Craig Ball did assuage our concerns (a bit) by telling us that while we live in an infinite universe it is all manageable.

At all of these ESI events it was stressed — stress being the operative word — that in-house legal departments have been forced to cut their budgets just like their “sisters”, the law firms but with a greatly increased workload.  And the end of 2009 and the beginning of this year saw survey after survey tell us/show us that ESI and e-discovery requests would simply skyrocket.  As one of many examples, see the Enterprise Strategy Group study (click here).

So companies are looking to innovate their way out of the recession, strategically cutting costs, bringing services and processes in-house to gain more control, and doing more than just “quickly brandishing an umbrella looking for a place to seek shelter” quoting the  Enterprise Strategy study.

But as one memorable GC told us at the ACC Annual Meeting in Boston last year “the reality is we need to get control of our ESI — our data data data which seems to be everywhere!! — at the very beginning of our process.  Not just at litigation time”. 

A nightmare.  Or two … or three …. for general counsels everywhere.

And while it is impossible for a general counsel to isolate the effects of software from all the other efforts presumably made to rein in outside counsel and other spends, corporate law departments can control spending via technology.  And there are vendors and technology galore as ESI management, e-discovery, governance, compliance and risk are all melding into one pot.  And those great folks at Gartner have provided us with a nice summary of the e-discovery vendor landscape as we begin 2010 (click here).

So as LegalTech New York comes quickly upon us (click here) we are launching a new series whereby we will post detailed interviews we conducted over the last several months with the thought leaders in ESI management and e-discovery, with links to articles, blog posts and websites, focusing on ESI management and e-discovery for the corporate law department, and the law firm. The series will run up to and through LegalTech, and beyond. We have some 30+ interviews in the queue which will include:  Dean Larry Center, Bob Eisenberg and Nicole Steckman of Georgetown Law CLE; Tess Blair of Morgan Lewis; Jim Moore of Merrill Corporation; Ron Friedmann of Integreon; Deborah Baron of Autonomy; Tim Williams of Index Engines; Steve d’Alencon of CaseCentral; Nigel Murray of Trilantic; Virginia Henschel and Rob Robinson of Applied Discovery; Mary Mack of Fios; Adam Cohen of FTI Technology; Chris Dale of the eDisclosure Project, plus many, many more.

Our intent is to provide a background in finding potential cures for the ESI/data management nightmare as seen through the eyes of the major players in ESI management and e-discovery:  what technology is out there, who is out there, how do you sort through all the technology, procedures, best practices, etc.  Most of these folks will be presenting and/or exhibiting at LegalTech in a few weeks so we’ll also tell you where you can find them at the show. 

And a bit later in this series we will have interviews with Jason R. Baron, Ralph Losey and Craig Ball who will put all this tsunami of “data! data! data!” in perspective for us.

But we start off this series with some interviews with some extraordinary companies that have recently come onto the ESI/e-discovery scene.  First up:  an interview with Andy Wilson, co-founder of Logik.  For our full interview with Andy click here.

For all interviews and posts in this series click here. 

 

As last week’s sessions at ACC Boston (click here) certainly stressed — stress being the operative word — in-house legal departments have been forced to cut their budgets just like their “sisters”, the law firms.   But with a greatly increased workload.  And it is due not just to the increase in litigation/investigations but because of regulatory/compliance issues.  As one GC told us, “we have more and more regulatory/compliance issues and we are seeing far more regulatory inquiries than in prior years … and we simply cannot cover it all.  Worse are the ‘information requests’ which seem to have tripled”. 

Corporate law departments have always sought ways to control spending on outside counsel — which (according to ACC members we spoke with) can be 60 percent or more of their budget.  Costs of outside counsel had been growing at eight to ten percent per year while law departments’ budgets averaged four to five percent growth per year. So, the question facing general counsel has been:  “How can I deal with skyrocketing outside counsel expenses on an ever-shrinking corporate budget?”

The next largest drivers are salaries for house staff and technology costs. Legal management software, for instance, covers not only the basics like spreadsheets and word processing but also more complex functions like matter management and spend management solutions as well as e-discovery tools, which increasingly includes tools that enable a law department to bring some of that work in house and not rely as much on outside firms.  As the staff at LexisNexis told us “technology costs are growing today because there is more pressure to reduce budgets by using technology to reduce people costs” [LexisNexis introduced us to their product CounselLink  which captures all legal department spending. We’ll detail that in a subsequent post]. 

So with the litigation train continuing to steam ahead, creating ever-increasing risk management challenges for large corporations, many corporate legal executives have come to the conclusion that their best option for survival is to wrest back control over their litigation portfolio. This may be a bit of a hyperbole – few companies ever actually ceded their litigation management to outside law firms over other service providers – but it seems clear that the balance of power in the control over how litigation is managed is swinging back toward the corporate law office.

And as Craig Bennett of LexisNexis recently opined “one important metric that benchmarks the industry trend of more legal work moving back in-house is the shift in hiring plans this year. According to an Inside Counsel survey reported in the March 2009 issue, 48 percent of corporations plan to reduce the number of outside law firms they use, but a nearly identical 49 percent plan to increase their number of in-house staff attorneys. Clearly, the trend is toward companies exercising greater control over their litigation portfolio”.  For his full post click here.

But it is not just in the discovery process but for overall efficiency in all law department operations.  It is part of the compliance initiative, an understanding of the broad Governance, Risk and Compliance (GRC) program that all law departments have developed or are developing.  The explosion in technology over the past 15 years and the “sudden appearance” of e-discovery are just a part.  Yes, dealing with e-discovery is a component of a risk management program, and understanding how e-discovery magnifies risk is one of the major factors in compelling companies to be proactive in setting up compliance and risk management programs.   But how a company goes about addressing the risk of litigation before a summons and complaint are served is where the battle lies.

There is still, in many companies, a patchwork of technologies and solutions to address a variety of problems — in place but disconnected.  Too many technologies make for overlapping coverage of risk and, at the same time, gaps in coverage.

Which is why we heard the clarion call (at least 1 million times last week) from GCs and AGCs: “we need a proactive information management strategy that can greatly improve our preparedness and increase our organization’s cost savings.” 

But let’s focus on the immediate concern in the life of an in-house counsel is a scenario (or a variation of this scenario) playing out daily in countless companies around the country:  you just received a complaint filed in Federal Court … or if you’re PepsiCo it’s a $1.26 billion default judgment  because you forgot to show up in court   

The complaint raises [product liability claims, contract violation claims, patent infringement claims, fill in the blank] and the allegations implicate the engineering, manufacturing, marketing and sales organizations. Relevant information needs to be identified and preserved, and the clock has started ticking.  What do you do?

But whether the information request comes in the form of formal discovery, a request for information from a government agency, or the need to identify information relevant to a pending internal investigation, the steps you have taken to manage your information before such a request materializes will have a direct impact on your ability to respond.

Today, information is being generated at such a rapid pace that the typical reactive approach to discovery no longer makes sense. As courts and practitioners have struggled to interpret the practical application of the revised Federal Rules of Civil Procedure, the challenges of handling these issues have highlighted the need for a different, more efficient approach to the discovery process. This has become even more apparent given today’s economic climate and the need to reduce costs and promote efficiencies.

For many organizations, responding to discovery or requests for information has been reactive, something akin to a fire drill. The typical response was a shotgun approach where information was over-preserved and then provided to outside counsel for review.   In today’s world of electronically stored information, these practices do not scale.  The reactive approach is time-consuming and expensive, and it diverts resources (both human and financial) from other critical functions within the business.

Enter … technology!   And technology will tell you (ok, the vendor will tell you) “I can help.  Bring all your troubles to me and I will solve them.  But first, let’s make 5 baskets because I work better in a basket, or maybe 2 baskets and sometimes all the baskets  … but the point is I love baskets … and PowerPoints … SlideShare works for me, too”.  Anyway, the baskets:

1.  Information Management

Information management is relevant to all layers of an organization. No matter what a person’s job function entails, it is imperative that end users are able to access the information they need to do their jobs. However, retaining too much information can overwhelm an organization’s systems and increase risk in the event of litigation or regulatory scrutiny.

2.  Centralized Identification/Preservation/ Collection

One of the most significant challenges an organization faces in its discovery process is the ability to quickly identify information that may be relevant to a pending matter and the ability to preserve and collect that information. Oftentimes, the costs associated with identifying and preserving data can be extraordinarily high from both a monetary and a human resources standpoint.

3.  Legal Hold

An organization must make a good faith and reasonable effort to preserve information that may be relevant to a legal or regulatory matter once litigation is reasonably anticipated. Unstructured data and data dispersed across multiple locations makes it extremely difficult to determine what is relevant. In addition, securing relevant information from normal destruction practices can test an organization’s ability to identify which systems and processes may be affected.

4.  Early Case Assessment/Meet and Confer Preparedness

The Federal Rules of Civil Procedure require that parties meet and confer to discuss various e-discovery issues early in the discovery process. In addition to these legal requirements, there is a strategic advantage to being able to review and analyze the facts surrounding your case as quickly as possible. Whether an organization is sued or is evaluating bringing a cause of action against someone else, knowing which information supports your case and which information may harm it can help you evaluate your position and risk.

5.  Review and Production

Given that the bulk of e-discovery costs can be attributed to the review process, the ability to proactively manage some of this workflow in-house can result in tangible cost savings. For organizations that are not staffed to do review in-house, an archiving and review tool can still provide substantial benefit. In these cases, an in-house legal or IT team can simply search the archive for relevant information using specific keywords, date ranges or custodians. This allows much larger data sets to be culled down to more manageable volumes and reduces the amount of information that is ultimately exported for review by outside counsel.

And so we come again to … the technology.  And if the Fulbright 6th Annual Litigation Trend Survey Report is to be believed, this is one hell of a great time to be a litigation/e-discovery vendor.  Or any legal vendor.

So, we have set the scene, we have summarized highly complex relationships and concepts in some ridiculously short paragraphs so now … what technology tools can be deployed to manage/assess data and enable law departments to enhance the department’s global risk management preparedness? 

Good question.  Coming up next in this series are interviews with companies that say “Yes, we can” and they cover a wide range of expertise:  Business Integrity, CaseCentral, doeLegal, eTERA Consulting, Digital Reef, Fios Inc., Huron Consulting, LexisNexis, Lex Mundi, Orange Legal Technologies, Practical Law Company, Recommind, and Transperfect Legal.  

We will then follow with “non-tech” interviews with Ajilon Legal, Foley & Lardner, Hogan & Hartson, Morgan Lewis, Robert Half Legal, and Womble Caryle.

As we have reported in several posts these last few months, early case assessment (ECA) is the key technology to reducing the cost of e-discovery.  There have been multiple vendors in this space with Clearwell Systems the leader (click here).

Most new ECA platforms have been standalone applications that required users to import and export data depending upon what other eDiscovery technologies that they were utilizing. 

But now we have CaseCentral (click here) stepping to the plate by integrating ECA into their offering and enabling users to now start with ECA and extend through analysis, review, production and post-production re-use, facilitating collaborative assessments of new case merits and liabilities, application of first pass review, and real-time transfer to active review if required, all at a price point that changes the current ECA pricing model.

And in the area of “document relevance” is Equivio which is the hands-down leader in near de-duping and email thread management technology. They have just launched Equivio Relevance^TM which provides:

• Early case assessment: facilitates rapid assessment of the key issues and concepts in a case.
• Culling: ahieves high levels of recall and precision, helping overcome the challenges of over and under-inclusion that characterize traditional keyword methods.
• Review prioritization: By organizing the review set according to relevance rankings, Equivio enables prioritization of document review. This allows attorneys to immediately focus on the most relevant documents.
• Review quality assurance: By identifying discrepancies in the responsiveness designations vis-à-vis the human review team, the application helps find responsive documents missed in the detail review. Similarly, the discrepancies can be used to locate documents incorrectly marked by the human review team as responsive.

We’ll have more on other technologies in another post during LegalTech West Coast.  For our full coverage of LegalTech West Coast click here.