1 April 21 st, 2010 From Archiving to Legal Holds: Comprehensive Information Management John Jablonski, Esq., Partner, Goldberg Segalla, LLP Wayne Wong, Managing Consultant, Kroll Ontrack 2010 Kroll Ontrack Inc.
2 Slide Materials To download a complimentary copy of today s slide materials, please follow these instructions: 1. Go to 2. Scroll down to the Event Materials section. 3. Select today s presentation, From Archiving to Legal Holds: Comprehensive Information Management 4. Enter April as the User ID and webinar as the Password. 1
3 John Jablonski, Esq. Partner, Goldberg Segalla, LLP Consults with fortune 500 companies about pre-litigation planning, record retention policies and implementation of legal holds. Frequent speaker and author on e- discovery, legal holds and electronic evidence, including articles in Law Technology News and the Information Management Journal. Co-author of the book 7 Steps for Legal Holds of ESI and Other Documents, has given legal hold workshops around the country and has participated in numerous podcasts and webinars on legal holds. 2
4 Wayne Wong Managing Consultant, Kroll Ontrack Ensures litigation preparedness for clients through the creation of discovery, data collection and case management strategies to support repeatable, efficient and reliable electronic discovery procedures. Works directly with clients to assess their electronic discovery capabilities and offers proactive solutions to manage ESI. Advises clients on tactics for responding to litigation, including techniques and documentation for accurate and complete identification, preservation and collection of relevant ESI. 3
5 Discussion Overview Comprehensive Retention & Disposal Protocol Utilizing Information Management Technologies Legal Hold Implementation & Monitoring 4
6 Comprehensive Retention & Disposal Protocol 2010 Kroll Ontrack Inc.
7 Retention and Disposal Protocol: Business Environment Evaluation Corporations must balance the need to comply with legal and regulatory requirements with the business efficiency and storage capacity concerns of IT Must find a way to retain records as required while appropriately disposing of non-essential, non-record data to free storage space and prevent risks and inefficiencies caused by over preservation 6
8 Retention and Disposal Protocol: Retention Regulations Various state, federal and international regulations, such as Sarbanes- Oxley, SEC 17a, Gramm-Leach Bliley Act and HIPAA, pose strict records retention requirements Companies should implement a records retention policy and retention schedules that establishes governance and compliance with applicable regulations 7
9 Retention and Disposal Protocol: Why Worry? Over retention poses significant risks Ability to produce relevant information in the event of litigation or an investigation is a major concern Over retention can lead to increased IT staffing and storage needs Can also lead to greatly increased e-discovery costs by creating larger data volumes, which significantly increases document review time 8
10 Retention and Disposal Protocol: Development Determine retention periods Classify records by purpose and useful life Documents should be destroyed promptly after the useful life is exceeded (taking into account any applicable regulations) Create a record retention schedules that dictates how long each record classification should be kept Maintain citations of regulations in the schedule along with the retention period and trigger date Will ease eases periodic updates Increases defensibility 9
11 Retention and Disposal Protocol: Development Once it s determined what should be maintained, the next step is deciding how it should be maintained or destroyed Policy should detail where and in what format documents should be retained, and when the documents should be converted to a different format Develop monitoring and reporting processes that provide proof of retention compliance 10
12 Retention and Disposal Protocol: Implementation Document retention and disposal protocol must be clearly communicated to all levels of employees If necessary, systems and processes within the company must be modified and updated to comply with the policy Implementation is not enough! Adherence to the policy must be monitored 11
13 Utilizing Information Management Technologies 2010 Kroll Ontrack Inc.
14 Information Management Technology: Archiving Solutions Important differentiation between enterprise functions of backup protocols for disaster recovery and archiving for information management Data archiving provides comprehensive solutions to the following enterprise issues: Cataloging and indexing of data enabling enterprise-wide searching of who, what, and when. Establishing clear and document life cycle of data consistent with the document retention schedule, including suspension of disposal when under legal hold. How can relevant data be identified and preserved? How can data sets be narrowed in order to reduce e-discovery costs? 13
15 Information Management Technology: Why Archive? Litigation Readiness & Investigations Regulatory Compliance & Corporate Governance Operational Efficiency 14
16 Information Management Technology: Why Archive? Litigation Readiness & Investigations To control e-discovery costs largest unbudgeted expense Meet short timelines to preserve, collect, process, review and produce Deliver electronic information in a form conducive to cost-effective document review Demonstrate affirmative action taken to comply with the duty to preserve (including suspension of scheduled disposal) 15
17 Information Management Technology: Why Archive? Regulatory Compliance & Corporate Governance Meet regulatory requirements for record retention Provide monitoring and reporting for compliance audits 16
18 Information Management Technology: Why Archive? Operational Efficiency Index retained data for efficient retrieval Create effective retention policy Improve mail server performance Reduce data volume through single instance storage Conserve IT resources consumed finding data to support litigation Eliminate offline data stores 17
19 Information Management Technology: Archiving sent or received ingested into the archive Retention policies applied Litigation/ investigation anticipated User searches archive Legal hold applied After legal hold has been released Export for discovery Scheduled disposal 18 18
20 Information Management Technology: Archiving Automated legal hold notification An archiving solution should possess an ability to administer a legal hold or suspend document disposal Only 57% of U.S. companies have an identified means to preserve (legal hold policy) potentially relevant data Kroll Ontrack, Third Annual ESI Trends Report (2009) 19
21 Information Management Technology: Archiving Key Features Data is in a known location Ability to capture multiple data types Effective searching capabilities Filtering and monitoring capabilities Legal hold on primary instance of the data, suspends retention/disposal Granular release Exportation of data for efficient discovery processing and document review 20
22 Legal Hold Implementation & Monitoring 2010 Kroll Ontrack Inc.
23 Legal Hold Implementation & Monitoring: Duty to Preserve It is well established that the duty to preserve evidence arises when a party reasonably anticipates litigation. -Pension Comm. of the Univ. of Montreal Pension Plan v. Banc of Am. Sec., LLC, 2010 WL (S.D.N.Y. Jan. 15, 2010). 22
24 Legal Hold Implementation & Monitoring: Duty to Preserve [O]nce a party reasonably anticipates litigation, it must suspend its routine document retention/destruction policy and put in place a litigation hold to ensure the preservation of relevant documents. -Treppel v. Biovail Corp., 2008 WL (S.D.N.Y. April 2, 2008)(quoting Zubulake v. UBS Warburg LLC ( Zubulake IV ), 220 F.R.D. 212 (S.D.N.Y. 2003)). 23
25 Legal Hold Implementation & Monitoring: Trigger Event A trigger event is an event that creates notice of reasonably foreseeable litigation or investigation and activates an organization s duty to preserve documents and electronically stored information Come in many different forms Highly dependent upon facts and circumstances of individual cases Examples Pre-litigation correspondence Retention of counsel Pre-litigation discussion, demands and agreements 24
26 Legal Hold Implementation & Monitoring Legal hold implementation process should be systematic and defensible Upon reasonable anticipation of litigation or investigation: Issue written legal hold and communicate with affected parties Ensure that department heads, IT personnel and all pertinent employees are made aware of the hold Counsel should also notify legal opponents and relevant thirdparties of their duty to preserve potentially relevant and responsive data 25
27 Legal Hold Implementation & Monitoring Suspend routine/automatic disposal practices Auto-destruct policies in systems Routine overwriting or recycling of tapes Defragmentation and other forms of automatic or routine drive clean-up Ensure hard drives and network resources are not re-deployed to new employee when custodian leaves the company Prevent purging of data from any systems being upgraded or decommissioned due to merger/ acquisition 26
28 Legal Hold Implementation & Monitoring Ensure and monitor legal hold compliance Counsel should actively monitor suspension measures and personally ensure compliance Follow up with key players and new employees who may be affected by the hold Send follow-up notices, especially during prolonged litigation Maintain documentation of who, what, when and how litigation notices were acknowledged Provide list of custodians to IT and HR to ensure compliance Determine if modification of the legal hold is necessary 27
29 Legal Hold Implementation & Monitoring Legal holds should remain in effect until: All appeals deadlines have tolled and the entered judgment and award is final A final settlement agreement has been reached and formal release has been signed by all parties The case is dismissed with prejudice and no outstanding related claims remain 28
30 Legal Hold Implementation & Monitoring Explicit notice to release legal hold needs to be provided Serves to officially resume scheduled disposal Care should be taken not to lift the hold on particular data that may be concurrently under hold for another matter 29
31 Parting Thoughts 2010 Kroll Ontrack Inc.
32 Parting Thoughts Implementing comprehensive information management strategies and practices will ease strain on resources, and minimize risks when faced with litigation or investigations Use of technologies, such as archiving solutions, bridges the gap between IT and legal and contributes to systematic and defensible legal hold applications 31
33 Slide Materials To download a complimentary copy of today s slide materials, please follow these instructions: 1. Go to 2. Scroll down to the Event Materials section. 3. Select today s presentation, From Archiving to Legal Holds: Comprehensive Information Management 4. Enter April as the User ID and webinar as the Password. 32
34 2010 Kroll Ontrack Inc.