Control It Yourself - A New Service Concept In E-Discovery Technology

E-discovery technology is changing rapidly. The demand for more effective data security is at an all-time high. Data volumes continue to grow, and the use of e-discovery technologies has moved beyond the realm of litigation into the investigation and compliance fields. How can corporate legal departments keep up with this bullet train and still focus on business law? Corporate counsel requires a solution that is agile, up-to-date, economical, and provides control over their data.

The Historical Solution

Historically, the most common solution for legal departments that wanted high levels of control has been to keep the processes in-house. A handful of companies made large investments and built out extensive litigation support departments that acted as fully operational electronic discovery service companies. Because there were few breakthroughs in e-discovery technology, they were able to make a one-time investment in software with only periodic or annual standard upgrades. Though expanding data volumes might have necessitated the investment in additional hardware, the unchanging underlying technology translated into little need for ongoing training. In many cases, these ventures were able to provide a clear return on investment while giving corporate counsel control over data and their discovery portfolio. With a centralized system, GCs established consistent, repeatable processes and gathered business intelligence about their litigation expenses. That knowledge helped corporate counsel make informed budgeting and feasibility decisions on impending matters.

However, this do-it-yourself (DIY) scenario has not proven to be efficient for most corporations, especially small to mid-sized companies. Because of the investments required – in both technology and personnel, or because they chose to focus on their core businesses rather than on the business of e-discovery – most legal departments have historically outsourced their e-discovery processes.

In the outsourcing model, these corporations handed over complete control of their data, workflow and protocol to outside counsel and a variety of contracted e-discovery service providers. Unless they established their own case-tracking and analysis systems in-house, general counsel, whose cases were spread among various service providers, lacked the business intelligence that the DIY departments enjoyed.

The Shifting Landscape

In the recent past, major shifts in the industry have been the impetus for change:

• E-discovery technology is changing rapidly, which necessitates more frequent investments in new software along with the requisite personnel training or talent acquisition.
• Highly publicized, high-profile data security breaches have brought cybersecurity risks to the forefront for IP and risk management attorneys.
• Continuing data volume growth has expanded the number of documents subject to electronic discovery for any given case and the related e-discovery costs.
• The maturation of cloud-based offerings into enterprise-grade software with corresponding infrastructures has propelled acceptance of these tools in the legal industry.
• The increased enforcement of federal regulations such as the Foreign Corrupt Practices Act (FCPA) has driven an upsurge in internal investigations.

These changes are affecting corporations with in-house e-discovery capabilities as well as those with an outsourced process.

Companies following the do-it-yourself model have developed litigation support departments with extensive experiential knowledge that they hope to leverage on future matters. Many of these companies, however, are choosing not to maintain the e-discovery infrastructure and software; the constant need to reinvest in emerging technologies and related hardware, and the added burden on their IT staffs to manage e-discovery security issues, are no longer financially viable. At the same time, they are unwilling to relinquish the control that in-house litigation support departments have provided.

GCs on the other end of the spectrum have seen how analysis of internal data offers an advantage to corporate business units. They would like to apply the same types of analysis and business-process control to legal processes. Companies with international business are discovering that the same technology used for discovery in litigation serves their internal investigation efforts. There is also a growing awareness of the need for a central point-of-contact for all discovery projects. Corporations are willing to onboard an e-discovery expert but do not have the budget for the technology.

A New Concept

Many companies are finding that neither of the traditional service models fits corporate litigation budgets while satisfying risk-mitigation efforts. Recently, a hybrid, more flexible approach has emerged. It provides the benefits of both models. A prime example of this service concept is Control-it-Yourself™ from Complete Discovery Source (CDS), which is based on the cloud-based software, Nytrix™.

CIY™ places the initial and ongoing investments in software, infrastructure, and security with the service provider, gives the client the ability to determine the portions of the process that its internal personnel will run (right-sizing payroll and training investments) and places ultimate control of the data with the corporation.

Consolidating all discovery data onto a single, dedicated location and tracking metrics across all matters gives the GC the information necessary to develop efficient processes and to make business intelligence decisions regarding future cases. This data consolidation also facilitates the re-use of data across multiple similar cases to reduce processing and review costs. “The level of control that CIY offers would be much too expensive in the traditional hosting model. You can log into your company’s secure environment and manage your cases as if it were in your facility. You can manage the actual data – transfer it between cases, hold it offline for future cases, or move it off the system entirely as needed,” said Garrett Bendel, chief operations officer of CDS. Bendel explained that a client would require the services of a full time dedicated PM at the service provider’s facility to obtain the level of control the CIY model provides.

This type of model was not possible in the legal industry just three years ago because attorneys were uncomfortable with the cloud as a legal data environment. A 2011 survey of in-house counsel found that only 29 percent of companies polled employed cloud technology. The recently released 2013 Corporate Counsel Survey showed a dramatic increase, with 4 of 5 respondents saying that they had a good experience with cloud-based computing. To provide the appropriate assurances regarding data security, a cloud-based offering that hosts legal data must be housed in a highly secure environment with verified security protocols. “We decided to seek SSAE 16 SOC1 Type 2 testing of our processes along with ISO 27001 certification for our information security management system (ISMS) to provide peace of mind for clients,” said Nyi Htwe, chief technology officer of CDS. By combining the secure environment with an SSL connection, CIY offers online-banking-level security.

After over a decade of the same two service models across the e-discovery industry, the introduction of a new hybrid model might be GCs’ ticket to the bullet train of change.

Lynn Frances is the Principal at eDiscovery Writer and is a legal technology analyst, writer, educator and consultant. Since 1999, she has tracked technology trends in electronic discovery and information governance to identify their effective application. Her work addresses the issues faced by in-house counsel, outside counsel, IT and specific business units. Ms. Frances can be reached at [email protected].