• $71,910 for flattening and indexing ESI
• $15,660 for Searching/Review Set/Data Extraction
• $178.59 for Tiff Production and PDF Production
• $74.16 for electronic Bates Numbering

Post-trial wrangling over costs is an arcane and difficult area of law. But it doesn’t have to be. According to the existing federal law, parties can claim the costs of converting electronic files to non-editable formats, and transferring files onto CDs were taxable as “costs of making copies of any materials.” In other words, they can reclaim the cost of making copies, but not the cost of processing evidence.

Following the Third Circuit in Race Tires America, Inc. v. Hoosier Racing the district court said Gallo, “may not receive reimbursement for any other ESI-related expenses,” and found that, in this case, “the only tasks that involve[d] copying [we]re the conversion of native files to TIFF and PDF formats and the transfer of files onto CDs” and awarded only $218.59 in ESI-related costs.

Don’t Fight Over the Check with These Guys

Ouch. While it is certainly painful to be reimbursed only $218 for six-figure bill, the case highlights a more obvious problem — why is eDiscovery pricing done this way? There was a time more than a decade ago when eDiscovery services were a new and evolving area. Service providers had to imporivse their bills because they were improvising and learning as they went. But today, eDiscovery processing is a relatively routine and well-defined business.

We will ignore the fact that these prices seem inflated. More importantly — how is Bates Numbering a separate service in 2013? How are all these services not part of the same job?

We believe in flat rate pricing. It has been our mission to bring transparency and predictability to eDiscovery service pricing since 2005. The advantage of being an Discovery Cloud customer is that you upload your data to our platform, and everything (all features and functionality you need) is there — and you pay ONE basic price. As it has been since 2005, our transparent pricing is on our website here.  We realize that simple, clear pricing makes us unique…but we’re okay with that.

Google’s search technology is one of the most closely guarded secrets in the business world. So it’s not really surprising that it is putting up a bitter fight in court to keep its search strategies under wraps. Apple attorneys want to know how Google found the documents it has produced for this intellectual property matter after being underwhelmed by the volume and quality of the information Google has produced. According to the court’s order, Apple argued for the production of Google’s search terms and custodians in order “to know how Google created the universe from which it produced documents.” The court noted that Apple sought such information “to evaluate the adequacy of Google’s search, and if it finds that search wanting, it then will pursue other courses of action to obtain responsive discovery.”

The Magic Bullet is a Blank

eDiscovery pundits like to think that they can just throw new search technology at data sets and magically retrieve all of the relevant documents in a matter. Everyone hopes through the magic of technology, machines will suddenly be able to review a collection of data and produce evidence to all parties. But lawyers should note that Google, the King of Search, relies on the of use of search terms to find data, not advanced algorithms and black box technology.

There are two important lessons in this ruling:

1. eDiscovery review is still dependent on good search terms. Even Google, the world’s most successful search company can’t find everything if it uses inadequate search terms.

2. Open and transparent search and review processes is essential to meaningful, cost-effective discovery. The court, citing the precedent DeGeer v. Gillis, noted, “[s]electing search terms and data custodians should be a matter of cooperation and transparency among parties and non-parties.”

Attorney and eDiscovery consultant Bill Speros recently wrote about search strategies on Ralph Losey’s blog. As a self-described “linguistic bird-dog,” he is concerned that lawyers have been led to believe intelligent machines will find all of the relevant documents in a matter. But as is clear in this case, even Google and its high-powered lawyers need to focus on the intelligent and thoughtful use of keywords to begin finding relevant documents. Successful search is an iterative process, meaning lawyers and reviewers need to consider whether they are returning relevant documents, and refining searches until they do. It takes common sense and careful consideration to review large sources of data, not just computing power and science.

Just as important is transparency, which means sharing search terms and methodologies with other parties. The court explicitly rejected Google’s arguments that as a third party, the company should not be compelled to reveal its search strategies, claiming it was somehow burdensome and compromising. As the ruling sarcastically noted, “Underlying Google’s premise is that transparency in the discovery process is a burden or that the methods of discovery are somehow sacrosanct, and that revealing those methods opens the floodgates to more requests for discovery.”

Initially, Google maintained that its search terms and choice of custodians were privileged under the work-product immunity doctrine, but that was flatly rejected. If lawyers fail to make that effort, courts will call them to task- even if those lawyers work for Google. Specifically, the court gave them 48 hours to show their work, at which point the parties are ordered to meet and confer in person to discuss the lists and to attempt to resolve any remaining disputes regarding Google’s production.

1. Leaving Social Media in the Hands of Your Client.

Alcohol makers tell their customers to give up their car keys. Lawyers need to take their clients’ social media keys.

In the recent case Gatto v. United Air Lines, Inc., (D.N.J. Mar. 25, 2013) the court sanctioned a plaintiff for deactivating and deleting his Facebook account. The important question is, why was this man still using his Facebook account? The parties had established it was going to be an important piece of evidence in this matter, so why didn’t they make a forensic copy of the data?

According to the court ruling, this is how the parties planned to conduct their social media discovery: the plaintiff agreed to change his account password to “alliedunited” (the corporate names of the defendants) and and turn the login information over to opposing counsel. However, the plaintiff claimed he didn’t think that would mean anyone would actually be accessing his account, and couldn’t figure out why someone else was logging into his Facebook page. Instead of changing the password or trying to figure out what was going on, he deleted the entire account.

We’ll talk about why deleting social media is bad more in the next item, but seriously, why did the plaintiff still have control of the only copy of his Facebook account? Social media discovery is not as simple as sharing passwords and logging into someone’s account. If anything, social media is trickier and more difficult to capture than other types of data. If the parties had simply made a copy of the page, as is standard practice with any other type of eDiscovery (and yes, the technology does exist), there would have been no chance a misguided plaintiff could have upended the case this way.

2. Deleting It. 

Let’s let the judge in the Gatto case mentioned above spell out your duty to preserve social media. ”Litigants in federal court have a duty to preserve relevant evidence that they know, or reasonably should know, will likely be requested in reasonably foreseeable litigation, and the Court may impose sanctions on an offending party that has breached this duty.”

In other words—preserve social media for litigation. If it gets deleted, you get sanctioned. ’nuff said.

3. Pretending Social Media is not Relevant.

In ruling after ruling, courts are telling lawyers that social media can be central to their matter, as in the recent  Reid v. Ingerman Smith LLP: “Although the law regarding the scope of discovery of electronically stored information (“ESI”) is still unsettled, there is no dispute that social media information may be a source of relevant information that is discoverable.”

Posts on social media are within the scope of “electronically stored information” as that term is used in Rule 34 of the Federal Rules of Civil Procedure. As with any type of evidence, litigation hold letters trigger an obligation to preserve posts if they are reasonably related to litigation. If parties can demonstrate that public social media posts even hint that there is discoverable information to be found, then the court will likely allow broad discovery of all social media postings- public and private. The party that addresses social media early in a matter will likely define the scope of that discovery.

4. Dragging Your Feet

Once again, let’s let a federal judge explain why “inappropriate and obstreperous” and “contumacious behavior” is not acceptable when social media is involved. On second thought, let’s forget what the judge said and talk plain English. In EEOC v. The Original Honeybaked Ham Co. of Georgia, Inc., despite establishing that social media was discoverable for the case, the plaintiffs failed to produce the evidence for several months. The defendant submitted discovery requests of this social media content, but the EEOC has, “made this endeavor more time consuming, laborious, and adversarial than it should have been.” 

The end result? An adverse inference which could easily destroy the EEOC’s case.

5. Getting Too Friendly with Judges, Colleagues, or Opposing Counsel

We understand that its important to establish a collegial and friendly working relationship with judges and other lawyers. We even understand that you might want to brag about the round of golf you just played with the chief judge in your jurisdiction. However, the ABA has now published an ethics opinion, warning that judges who use social networking have to follow the ABA Model Code of Judicial Conduct. (See Formal Opinion 462 for details).

If your case is going before a particular judge, be aware of the communications you may have with them. Are you Facebook friends with the judge or opposing counsel? Are you Tweeting them? Those communications are likely discoverable and potentially prejudicial.

6. Going on a Fishing Expedition

There have been a number of commonly cited cases in which courts have ruled social media is discoverable in order to illustrate an individuals mental state at a particular time. However, some legal teams seem to think that means they can just scoop up all Tweets, Facebook posts, likes, dislikes, Pinterest pins, and anything else someone puts online. These lawyers are hoping to use social media content to paint a picture of someone’s emotional and mental state at a given time. Courts have rightly said this is not a fair strategy. (I certainly hope I never have to defend my decision in court to “like” Mr. Roboto in my Facebook stream.)

In Kregg v. Maldonado, the court wrote that a party must show, “at least some of the discovery sought will result in the disclosure of relevant evidence or is reasonably calculated to lead to the discovery of information bearing on her claim.” Lawyers who make broad requests for social media or don’t understand the finer points of social media discovery are often shut out entirely- no social media for you.

7. Betrayed by Social Media

As reported in Computerworld, social media can give away your secrets. Are you visiting a particular client or well-known expert witness who could be the key to your case? If so, your social media might broadcast this fact to the world (and opposing counsel.)

All social media sites keep an astonishing amount of information about users; mobile apps are especially prone to give it away, in the form of your location, activity, or other information. This, of course, is a boon to requesting parties in a discovery dispute. But if you’re trying to keep your trial strategy under wraps, don’t let your smart phone or your love of Foursquare give you away.

8. Oops, I Forget to Have a Social Media Policy

Employees are going to tweet. That is true of lawyers as well. Tell your staff to disclose trade secrets, product introduction dates, or private health details. As the New York Times reported, the National Labor Review Board and other agencies and courts considering workers’ rights have ruled that workers do have a right to use social media. But without proper controls or directives, employees are likely to tweet something that is embarrassing or should be kept secret. It is up to you to have a policy that outlines your firm’s social media policy, enforce it, and have the technology in place to manage your organization’s social media usage.

Representing clients in today’s data rich and complex world is difficult enough. There’s no reason to let social media complicate things further. As we’ve demonstrated above, ignoring or taking a lax attitude towards social media is unacceptable. Nextpoint has been archiving social media for litigation since 2010. Talk to us about how to make social media discovery work in any matter.

As more eDiscovery software companies jump on the cloud bandwagon, it’s hard to separate what is a true, Software-as-a-Service cloud application, or to explain what the heck Infrastructure-as-a-Service or Platform-as-a-Service means. Kevin Remde, a technology evangelist at Microsoft published this nifty chart that breaks it all down.

The range of options runs from old-fashioned client-server software that demands an experienced, in-house IT staff, to services that offer some infrastructure, all the way to Software-as-a-Service (SaaS). As Kevin puts it, SaaS should require no “maintenance or updates or hardware other than your connectivity to the online service you’re purchasing.” That’s what we believe every law firm should look for in cloud software.

We at Nextpoint pay Amazon Web Services to use their infrastructure, and then we build out the rest of the software, features, and functionality on top of that. All you have to do is sign up, sign in, and start using the service. We offer training to help new users learn to take advantage of the service, but after that, the software is there for you to use as needed.

If you’re interested in learning more about Nextpoint’s eDiscovery cloud solutions, please contact us with any questions you may have. Or, since we are a true SaaS provider, sign up for free today and start using the service. That’s the power of a true cloud service.

Recently, we commented on an employment dispute, EEOC v. The Original Honeybaked Ham Co. of Georgia, Inc., in which the court hammered a federal agency for failure to produce social media in a timely manner. Now, in a Gatto v. United Air Lines, Inc., (D.N.J. Mar. 25, 2013) the court has sanctioned a plaintiff for deactivating and deleting his Facebook account despite a clear duty to preserve it.

As part of a personal injury suit, the plaintiff turned over passwords and login information to his Facebook account to opposing counsel. However, after opposing counsel logged into the account they found that the plaintiff had deactivated the account. He tried to claim that he had been involved in a contentious divorce and was afraid that someone who didn’t like him was hacking into his account. After 14 days, Facebook obliterated all data from a deactivated account, as is their policy. However, the court was not buying the angry ex-wife excuse, and issued an adverse inference against Plaintiff for failing to preserve his Facebook account and intentional destruction of evidence.

It’s Not That Hard

Sanctions like this are going to be increasingly common until parties understand that social media eDiscovery needs to be handled with the same level of care as with email or other computer files. Why do parties bring in forensic examiners to review computer hard drives, but when it comes to social media, a Facebook account is left in the control of the plaintiff? If Facebook data is part of your case, why not keep a complete record of that content that is accurate, searchable, and can be easily reviewed and produced? Cloud Preservation keeps a forensically sound archive and saves native formats and metadata, preparing you for any regulatory, litigation, or compliance demand. We capture everything, including linked content for a low, monthly fee.

The courts have now spoken. Don’t try to lie about it. And don’t try to destroy social media evidence before going to court. Oh, and don’t try to blame your ex-wife if you delete social media. And of course, find a way to archive social media for eDiscovery that doesn’t leave it in in a place where it can be tampered with or otherwise destroyed.

However, that standard is shifting for the first time in a decade. The groundbreaking UBS v. Zubulake case in the early 2000′s is still the most important precedent in this area. In a series of five separate rulings across hundreds of dense pages of balancing tests, U.S. District Judge Shira A. Scheindlin outlined what electronic evidence was discoverable in in litigation. (Judge Scheindlin also tightened and updated on that standard in Pension Comm. of the Univ. of Montreal Pension Plan v. Banc of Am. Sec., LLC, 685 F. Supp. 2d 456 (S.D.N.Y. 2010). Those cases, and many others that followed, held that the duty to preserve documents, including electronically stored information (ESI), arises when litigation is ”reasonably anticipated.”

For the most part, courts still follow the Zubulake and Pension Committee standard closely. For example, in Voom HD Holdings, LLC v Echo Star Satellite LLC , (N.Y. App. January 31, 2012) New York State Court’s First Appellate Department applied Sheindlin’s Zubulake standard almost word for word.

A Crack in the Foundation

However, in Chin v. Port Authority of New York and New Jersey, (2d Cir. July 10, 2012) the Second Circuit  softened the standard a bit, arguing that a failure to preserve evidence as soon as litigation is likely is not always immediately sanctionable. The case pits several Asian Americans police officers against the Port Authority of New York in an employment discrimination based on race. During discovery, the plaintiff found that the Port Authority had destroyed human resources records regarding promotions even though litigation was imminent. In the past, the Zubulake standard would have almost certainly meant immediate sanctions were warranted. But because the files were considered relatively unimportant, the court reasoned sanctions were not necessary.

So does this mean companies don’t have a clear duty to preserve relevant records if litigation is likely? No. They still have a clear obligation, but for the first time, there is some room to maneuver. Companies complain that they have to over-preserve for litigation because the Zubulake standard is so broad and onerous. But as long as your company makes an effort to preserve all files that are obviously important to a pending matter, there is finally some relief if you do lose or destroy some potentially responsive documents. Just be ready to prove that the destroyed documents are not obviously important or immediately relevant to a matter.

We’ve pointed out as often as possible that cloud applications like ours offer inherent security advantages over traditional, locally installed litigation software. That’s because cloud providers like Amazon, Microsoft, and Rackspace invest billions of dollar each year in research and development for cloud platforms. Microsoft recently announced it spent 90 percent, or $8.64 billion, of its $9.6 billion R & D budget on cloud services. Amazon Web Services, our partner, spends several billion each year on R & D and even more maintaining its security network.

That message might be slowly taking root. At the recent ABA Techshow, we spent a lot of time listening to lawyers talk about using the cloud for eDiscovery. For the most part, it seems that the security of data is not the primary concern anymore. Instead, it seems to have morphed into a more specific concern about ethical obligations in the cloud. That is, can lawyers give data to cloud providers if that data might cross international borders or otherwise leave their control?

The Ethics of Cloud eDiscovery

The  most recent ABA Legal Technology Survey found only 21 percent of respondents reported using cloud applications in their practice. (We suspect that number is actually higher, given that many people use cloud applications without knowing it. But that’s another post.) We agree that lawyers must consider the ethical implications before transferring data to a third party. But that only means that attorneys give cloud-based applications the same thought and care as with any other application. The preliminary questions for a cloud provider may be different, but the fundamental concern is the same as always: can you assure me that my client’s confidential information is secure and will not be improperly disclosed to other parties?

Your Ethical Obligations Today

The ABA Model Rule on Client Confidentiality, Rule 1.6 is the most important on this subject, requiring lawyers to protect their client’s property. However,  a recent change to ABA Model Rule 1.1 may also apply. That rule now defines “competent representation” as understanding the technology used to undertake representation of the client. That would seem to imply that an attorney must know how technology, including cloud eDiscovery software is employed on behalf of a client.

Most state bars haven’t considered cloud computing directly as of yet, although-Alabama, Arizona, California, Iowa, Nevada, New York, North Carolina, Oregon, Pennsylvania, and Vermont have issued some form of formal opinion. In general, these opinions have stated that it is ethical for attorneys to use cloud computing services as long as basic precautions are followed. A number of speakers at the Techshow recommended that attorneys notify new clients that their electronic data may be stored with a third party during the course of representation. This could appear in an engagement letter or any formal agreement with a client. These agreements should also specify that data will not cross international borders, where it could become subject to data privacy regulations. (As mentioned, Nextpoint uses Amazon Web Services, which gives us the ability to ensure data is stored within the continental U.S. or even a more specific geographic region.)

In addition, always consider the security your provider has in place, including:

Firewall to prevent outsiders from breaking into a computer system. Encryption to protect data as it is being transmitted. Intrusion Detection to identify potential threats. Lastly, remember to ensure data portability— that is, a guarantee that your data is yours and can be recovered whenever needed. Nextpoint believes this information should all be transparent and clear. You can see our guarantees at trust.nextpoint.com. Make sure your provider offers the same promises, and the ethical concerns about cloud computing should quickly disappear.

Thanks to Michael and all of the other people who visited our booth at the event to learn more about our services! Of course, if you can’t make the trip to one of the many live events where Nextpoint can be found, you can always learn more about us anytime through our online demos or reach out and contact us.

It should have been obvious that this was not a workable solution. Any lawyer attempting this approach would have to be both extremely tech savvy and understand eDiscovery workflow, chain of custody rules, and all of the nuances of uploading, processing, indexing, searching, and producing records for litigation. Anyone can become good at any one of these tasks, but even large law firms and corporate law firms have trouble managing them all at once.

What I Should Have Said…

Lawyers began to realize earlier last decade that eDiscovery software is too expensive to maintain for small matters. But judging from the talks at last week’s ABA Techshow, it seems that lawyers have finally given up on the idea that eDiscovery is something they can do on their desktop. The eDiscovery punditry seems to recognize that Software as a Service (SaaS) or cloud computing is the only sensible eDiscovery solution, at least for small matters. Tom Mighell, Senior Consultant with Contoural, Inc. spent a couple of hours reviewing Nextpoint’s Discovery Cloud and other cloud eDiscovery tools for his ABA Techshow talk, Using Cloud-Based Tools for E-Discovery. “If I can get up to speed in two hours, you can use these tools,” he said. “The security, features, and ease of use means these cloud eDiscovery services are ideal for solo small firm lawyers.”

Why it Makes Sense

The world of litigation support and eDiscovery has been ruled for years by comprehensive systems like Summation and Concordance that have histories going back several decades. These platforms require sizable investments in software, hardware and training to operate fluently within a law firm environment. For lawyers in smaller firms, these tools are impractical, requiring more investment in infrastructure than makes sense for law firms with fewer attorneys.

However, the rise of cloud technologies gives small firms litigation support tools once available only to AmLaw 100 firms. Nextpoint’s Discovery Cloud is the oldest, most feature-rich, and most mature such solution. You can see for these claims yourself on the Discovery Cloud website, where its features and capabilities are specified and explained. The bottom line is that Discovery Cloud provides most of the major features found in the larger server-based products with more flexibility, easier management, and of course, a much lower cost of ownership. It’s easy to forget that cloud computing has become important only in the last few years. But the rise of SaaS technology like Discovery Cloud means that no one should ever consider trying to cobble together a home-built solution. I’m sorry if I steered anyone wrong.

Seen at Techshow

Even at this advanced age, the legal technology industry is still providing new innovations. As noted in Law Technology News, there are some interesting new mobile applications, videoconferencing solutions, and some updates to industry warhorses. The most interesting new product might be Timesteam, an application for computer investigators in a thumb drive. Forensic investigators can store encrypted files while working on an matter in the thumb drive, which maintains chain of custody and keep s files safe in the smallest possible transportable device.

Not Enough Changes for a Quarter Century…

But it was also obvious that a lot of the litigation technology from 25 years ago has not changed very much. For example, Summation and Concordance are still the leading databases for managing electronic records in litigation, both of which first appeared in 1984.

The deeper problem is not just outdated software, but that litigation technology is still deeply divided. Here is our non-comprehensive list of some of the biggest names in litigation technology across the commonly defined phases of litigation.

This is what most legal technology buyers are up against. The installed technology that has been in use for decades is still found in most law firms’ toolkit. The recent wave of consolidation in the industry was supposed to solve some of this fragmentation. But look at LexisNexis, which now owns more than 80 litigation applications, including Concordance, CaseMap, TextMap, and TimeMap. Since Lexis began its acquisition bender, buying some of the best-known applications in the industry, has the situation improved at all? Does any law firm in the world call up Lexis and ask for them to set up a full suite of practice management and litigation software? Probably not.

Can you think of another industry that relies on software that was first popular in the 1980s? It’s no mystery why law firms complain that their litigation software solutions are clunky and don’t coordinate well. It’s because each step of the litigation process is built on a different platform that speaks a different language and was built years ago for a completely different computing environment.

The Future is Now

Nextpoint realized long ago that the cloud platform was the future of computing. There’s a reason why we refer to our solutions as a “litigation platform” and not an application. Our technology is a cloud platform that provides archiving, eDiscovery, and trial functionality. We don’t force users to convert or reimport data every time you move to a different phase of litigation. Your data lives in the cloud platform and users perform the tasks needed in order to move their case along. The ABA Techshow is a great place to see state of litigation technology in one roof. But we have to believe that the next few years of Techshow is going to look a lot different than the last 25.