How to Avoid Electronic Discovery Sanctions through Proper Preparation

Courts are continuing to issue electronic discovery sanctions against companies who did not properly prepare for the discovery of their electronically stored information (ESI) in the event of litigation.  The days when business was handled through written memorandums and other correspondence have quickly faded.  Today, normal business is primarily handled electronically, through emails and attached electronic documents.   Unfortunately, litigation preparation has not kept pace.

legal-discoveryElectronic Discovery is Different than Traditional Discovery

Although offices have not gone completely paperless, most have significantly reduced the amount of paper being generated.  More business is conducted through email than ever before.  Paper documents were relatively easy to locate during the discovery process as they were usually neatly filed into labeled folders in a file cabinet.  Electronic discovery is different not only because of the ways in which the information is “filed,”  but also due to the sheer volume of ESI generated and maintained by a company.  It’s also difficult to isolate ESI directly related to the litigation from the mass of non-related emails and other information that a company generates and receives.  Electronic data is also harder to eliminate than paper documents as deleting an email does not necessarily mean the file is gone; and it’s harder to preserve since most information systems routinely overwrite data in the normal course of operation.  These differences are a prime reason why electronic discovery sanctions are being issued.

How Can A Company Prepare for E-Discovery?

One of the best ways to avoid electronic discovery sanctions is to proactively prepare for any litigation that may occur.  All companies should have a document retention policy that indicates not only how long documents must be retained, but how they should be kept, as well as how and when they should be destroyed.  Creating a data map provides an inventory of IT systems which may contain ESI potentially relevant in any discovery, and can be used to streamline and validate the litigation hold process.  Remember to keep data maps updated.

electronic discovery sanctionsHow Can A Company Ensure that Relevant Information is Preserved?

As soon as there’s knowledge of a potential claim, or a reasonable belief that litigation is foreseeable, it is critical to craft, disseminate, and monitor a litigation hold.  The litigation hold should provide general information about the litigation, and include instructions regarding the preservation and collection of related ESI.  The hold should be issued to key individual custodians, as well as the custodians of IT systems that may contain relevant ESI.  Most systems automatically purge, or overwrite, data on a periodic basis.  The failure to suspend such routine overwriting often results in electronic discovery sanctions.  A perfectly crafted and disseminated litigation hold is of no use if it isn’t followed; courts are insisting that parties closely monitor employee compliance with litigation holds.  Finally, perfection in preservation is rarely achieved; it’s too easy to nit-pick decisions in hindsight.  So document the entire process – from the event that triggers the litigation hold, to the decision to lift the hold.  Courts are much less likely to issue electronic discovery sanctions for mistakes made in preservation, when decisions have been documented to demonstrate that they were reasonable at the time they were made.

Using a quality vendor, such as Advanced Discovery, on a routine basis, will also help prepare you for litigation and avoid costly sanctions.

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