Reducing the Cost of ediscovery in Today s Economic Climate. risk of ediscovery

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1 Reducing the Cost of ediscovery in Today s Economic Climate Strategies for reducing the cost and Strategies for reducing the cost and risk of ediscovery

2 The 2009 Corporate ediscovery Challenge Corporate Legal Budgets are CUT by ~ 20% Litigation is not going to stop but will INCREASE Securities, IP, Bankruptcy, M&A, Employment In the most challenging economic environment in 80 years, how can the corporate legal department Manage and reduce ediscovery costs? Mitigate and reduce ediscovery risks? Leverage existing and implement new technologies to achieve corporate objectives? 2 Confidential Internal use Only

3 ediscovery Cost Reduction Strategies Adopt documented ediscovery process Proactively improve litigation readiness Use preferred providers and review platforms Standardization reduces cost and risk Pursue Review optimization Reduce the size of the review data set Utilize Early Case Assessment Streamline processes, further reduce review data set Consider Contract and Offshore Reviewers Lower review rates with equivalent quality control Hybrid approach to in-sourcing/outsourcing ediscovery Determined by case type, size, risk and complexity 3 Confidential Internal use Only

4 Documented E-Discovery Process Creation of a proactive plan and a set of processes agreed to in advance that will be implemented in the event of a triggering event Documented, defensible process for handling ediscovery and litigation response consistently in each case, enterprise-wide and with any outside counsel or vendor Methodology for distinguishing a discovery approach to routine matters from one for those matters requiring heightened ediscovery attention Corporate meet and confer strategy, with corporate position on ESIrelated privilege, form of production and accessibility issues Standardized ESI-related Rule 26 disclosures, and standardized written discovery responses and responses 4 4 Confidential Internal use Only

5 E-Discovery Process Design Involves all relevant corporate groups, not just Legal and IT (may include HR, Finance, Records Management, Compliance, Audit, Business Units and others) Leverages electronic content management ( ECM ) and business process management ( BPM ) tools already in place in the corporation, and should be drafted with the intent of automating processes as much as possible Includes specific, standardized processes for imposition and release of litigation hold 5 5 Confidential Internal use Only

6 Increasing Judicial Intolerance for Poor ediscovery Process is Raising the Bar Zubulake V FRCP Amendments Seroquel Keithley Morgan Stanley Qualcomm Victor Stanley Regulatory / Governmental Investigations 6 Confidential Internal use Only

7 Use Preferred Service Providers Efficiencies in using preferred partners Volume-based preferred pricing Familiarity with data and protocols Familiarity with review tool Established communication systems Hit the ground running capability Permits analysis of case metrics 7 Confidential Internal use Only

8 Case Category Model Insights Our database of more than 200 cases enables more accurate ediscovery cost estimating for various types of cases, giving Counsel the information they need when deciding to litigate or settle. Often, Counsel learns that ediscovery costs less than expected. Our Case Category Model provides insight into: Quantity of custodians Raw data per custodian Ratio of data migrated to review after filtering and key word searching Item count in review Ratio of responsive documents Ratio of documents migrated to Privilege review Ratio of documents produced to opposing party Number of reviewers and hours required at each stage of the project 8 Confidential Internal use Only

9 Corporate Programs Must Account for Different Approaches Based on Case Categories EED Case Category Model EED, Inc All rights reserved. Antitrust Case Intellectual Property Dispute SEC/DOJ /Govt Investigation HIGH RISK M&A Commercial Dispute Employment Dispute Low Risk Very Small Medium Risk Small Medium Large Very Large 9 Confidential Internal use Only

10 Pursue Review Optimization Make use of advanced analytics, search consulting and culling technologies to reduce the amount of data going into review Use advanced review tool technologies, including term highlighting and clustering of near-duplicates and threads to increase review efficiency and improve consistency 10 Confidential Internal use Only

11 The document review process is the place to reduce ediscovery cost Legal Document Review is 70% of the cost of ediscovery & Review ediscovery Strategy Case Planning $25K Case Collection $75K Case Data Processing $150K Case Specific Legal Document Review $1.5 $150/hour ( 10,000 hours without Review optimization on 1 M docs) Case Hosting -$10K Expert Witness $100K Production to Opposing $50K Project Management $50K Time on average 7 months to 2 years 11 Confidential Internal use Only

12 Savings with Microclustering/CompareVue Data Set Size 501,622 Total Documents Review Cost* Linear Review $1,504,866 Microcluster Analysis Review Cost** (with Microclustering) 77,343 Orphan Documents(no microcluster relationships) 7,235 Duplicate Representatives with Microclusters >1 document 417,044 Documents in Microclusters Associated with Duplicate MRI s Orphans (77,343) $232,029 Duplicate MRI s (7,232) $21,705 Microclustered documents (417,044) $312,783 *Assumption: review cost of $3.00 per document **Assumption: Comparative Review cost is 25% of linear review. Total (Using CompareVue with Microclustering) $566, Confidential Internal use Only 12

13 Review Optimization Results At least a 50% -70% reduction in data volume As much as 200% increase in review speed 50% -75% reduction in all-in ediscovery costs 13 Confidential Internal use Only 13

14 Use Early Case Assessment Combines technology and discovery expertise Through use of sampling, provides quick look at data for better understanding and management of case Helps identify missing custodians or validate prior identification Supports settle versus litigate analysis 14 Confidential Internal use Only

15 Early Case Assessment What is it? Two Main Elements Data sampling/analytics/culling ECAS assists counsel by allowing them to examine samples of data early on in the case and allows them to: Estimate cost, review time and exposure Identify bad or exculpatory facts early in the case Smoking Guns Identify inaccessible data sources Provide counsel with more information about the case! Concept Search Ensuring greater legal defensibility, and prioritize documents for review 15 Confidential Internal use Only

16 ECAS Deliverables Collection/Preservation Report Report on collection/preservation strategy identify areas of risk Identify possible inaccessible data sources Data Analytics Reporting Provide reports that will help understand makeup of data, quantities, file types, etc. Social networking exercise Review Sample set/prioritized keyword list Prioritized review sets created Review main dataset Apply sample lessons learned to overall data set Spreadshee Presentatio t n 12% 23% General 2% Text 4% Archive 3% Code 0% 47% Document 9% 16 Confidential Internal use Only

17 Consider Contract and Offshore Reviewers More companies are using contract and offshore reviewers Significantly lower cost than law firm associates or review attorneys Greater opportunity for specialized expertise Equivalent (or better) review performance 17 Confidential Internal use Only

18 Meeting the Overall Challenge: Balancing Process and Tools for each Corp. Docket Pre- and Post Trigger Services Work Together to Provide Overall Efficiency Litigation Trigger 18 Confidential Internal use Only

19 2009 Corporate Buyer behaviors F500 evolving to 3 buying models * * In-Source * * * * Hybrid * * * * * * Outsource * * * In-Sourcing Segment Hybrid Outsource 1. Large Fortune Fortune Fortune Highly Litigated 2. Frequently Litigated 2. In-frequently Litigated 3. Strong/Large Legal group 3. Medium Legal group 3. Small Legal group 4. Started in 2000 or later 4. Started in 2005 or later 4. FRCP responding now 5. Auto, Pharma and SEC 5. Manufacturer, Insurance, 5. Retail, Manufacturing regulated Finance High Tech & 6. Little to no IT support to 6. Heavy IT support to Legal Communications Legal 7. Often some home grown 6. In-sourcing Collections 7. Can replace home grown software 7. Light IT support to Legal software 8. Can replace home grown 8. Looking at in-sourcing 8. Looking at insourcing Review software Analytics 9. Not yet ready to buy Process 9. Looking at in-sourcing 9. Do want Process Consulting Consulting or have no Review 10. Taking Law firm input on budget 10. Tell law firms what process is process 10. Let Law Firm still drive Process and Sourcing 19 Confidential Internal use Only 19

20 HOW DO YOU DECIDE? In-sourcing or Out-sourcing? Decision is Dependent Upon: Litigation Profile Philosophy of your GC/AGC Corporate Culture Budget Staffing In-house Expertise Competing priorities facing your IT group How far along you are in ECM & Records Management as a corporate platform 20 Confidential Internal use Only

21 Where to Start Hybrid Model is a Good Starting Point: Flexible Scalable Adaptable Case by Case Do What You Can In-House Fill in Gaps with Specialized Providers 21 Confidential Internal use Only

22 ediscovery Cost Reduction Strategies Adopt documented ediscovery process Proactively improve litigation readiness Use preferred providers and review platforms Standardization reduces cost and risk Pursue Review optimization Reduce the size of the review data set Utilize Early Case Assessment Streamline processes, further reduce review data set Consider Contract and Offshore Reviewers Lower review rates with equivalent quality control Hybrid approach to in-sourcing/outsourcing ediscovery Determined by case type, size, risk and complexity 22 Confidential Internal use Only

23 23 Confidential Internal use Only

24 For more information -- Jeffrey Jacobs VP, ediscovery Consulting Daticon EED 24 Confidential Internal use Only

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