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1 If you have any technical problems with the Webcast or the streaming audio, please contact us via at: Thank You! THIS WEBCAST WILL BEGIN SHORTLY

2 Cloud-Based vs. On-Premise ediscovery and Information Governance February 28, 2012 Presented By: Deborah Baron, VP Legal & Compliance, Autonomy, an HP Company Eric Crespolini, VP ediscovery Technologies, Autonomy, an HP Company Renee Meisel, Legal Director, Litigation Counsel, Dell, Inc.

3 Agenda Introduction Section II The Cloud: Pros, Cons, and Insights from Litigation-Based Practices Section III On-Premise: Pros, Cons, and Insights from Litigation-Based Practices Section IV General Considerations for ediscovery and Information Governance Section V. Practical Implications for Corporate Counsel Summary

4 Legal system is playing catch up with technology 4

5

6 Content is Now Interactive Growing volume of traditional content Internal and external lines blurred Business use of social media Moving to interactive content

7 II Cloud Computing: Pros, Con and Insights from Litigation-Based Practices 7

8 National Institute of Standards and Technology (NIST) Draft Definition Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. 8

9 Cloud-based Computing Evolution 9 Hosted services model in Web 1.0 world Providers leverage Web 2.0 advances to deliver Cloud-based Computing Fast and secure Web 2.0 infrastructure Friendly, responsive Java based user interface Liberated from client side/user software management Improved user experience at a lower cost Rapid deployment Pay per use model Linking adjacent, related applications across one infrastructure More savvy buyers Service Level Agreements Cost analysis of cloud-based v on-premises infrastructure

10 Characteristics and Models Essential Characteristics On-demand self-service Broad network access Resource Pooling Rapid Elasticity Measured Service Service Models Software as Service Platform as Service Infrastructure as Service Deployment Models Private Cloud Community Cloud Public Cloud Hybrid Cloud 10

11 IDC Survey: Top 4 uses of Cloud model Q: Rate your likelihood to pursue the cloud model for the following 11 Source: IDC Enterprise Panel, 3Q09, n= 263

12 Benefits 12 Source: IDC Enterprise Panel, 3Q09, n= 263

13 Challenges 13 Source: IDC Enterprise Panel, 3Q09, n= 263

14 Cloud-based Computing Adoption Across Industry Financial Services Firms Largest global banks Boutique hedge funds Investment management firms 14 Healthcare, Pharmaceutical & Biotech Consumer Products National Retailers Engineering & Construction Transportation Defense Contractors Government agencies

15 Cloud-based Computing Services Span the EDRM Spectrum Adjacent Processes Linked for Efficiency and More Effective Collaboration between Clients & Counsel Preservation Processing Creation Information Management Identification Review Production Presentation Volume Collection Analysis Relevance 15 Electronic Discovery Reference Model Iterative Processes

16 Search and Identification of Data Informa(on Theory and Bayesian Inference Advanced Conceptual Visualization Identify Hidden Custodians and Hot Data

17 III On-Premise: Pros, Cons, and Insights from Litigation- Based Practices Predictability On-Premise Software Appliance Solutions Legal Hold Lifecycle Search and Identification of Data Manage-in-Place, Preserve-in-Place, Analyze-in-Place Integration into Corporate Directory and Human Resource (HR) Systems Hold Release and Disposition

18 side letters procurement issues off balance sheet transactions Automatically cluster documents together by Themes in Context for Automated Review company registration auditing questions increasing operating costs transfer pricing poor quality inputs new suppliers high expenses for procurement staff poor supply chain management low inventory levels high returns ratio product performance issues unauthorized credit card transaction

19 IV General Considerations for ediscovery and Information Governance Legal Implications Select Applicable Federal Rules FRCP 34(a)(1) requires a party to produce documents and ESI within its possession, custody or control. FRCP 26(a)(1)(A)(ii) requires initial disclosure to opposing party of location of information in party s possession, custody or control to be used in support of claims or defenses

20 Applicable Federal Rules (con t) FRCP 37(e) governs ESI lost as a result of the routine, good-faith operation of an electronic information system FRCP 45 governs duties of nonparties regarding production of ESI pursuant to subpoenas 20

21 Selected Case Law 21 Flagg v. City of Detroit, 252 FRD 346 (E.D. Mich 2008) (where City of Detroit as defendant entered into contract for text messaging services with non-party service provider, held, City exercised sufficient control over ESI in form of text messages so as to require production to plaintiff under FRCP 34 standards; additionally, court ordered plaintiff to make its request under FRCP 34, in lieu of Court adjudicating dispute over the propriety of plaintiff s pending 3 rd party subpoena for same material)

22 Selected Case Law Galleon Hedge Fund Facts Text message provided first indications of potential insider trading Huge volumes audio, text, , documents, and trade records used to develop case Executives from companies including Intel, IBM, AMD, and many others implicated Results Unrecoverable event: Redemptions forced closure of $6 Billion in a matter of hours, solely on the accusation/indictment Regulators using full breadth of supervisor, investigatory, and ediscovery information; companies were not 22

23 V: Practical Implications for Corporate Counsel Cloud-based Compliance and Management of ESI Across the EDRM End-to-End : Information Management (e.g. Archiving) through to Review and Production All ESI in one data center for complete Chain of Custody Eliminate data conversion, shipping, hand-offs, re-ingestion Reduce cycle-time and lower cost of ediscovery Partnership between Cloud-based provider, client and law firm 23

24 Case-Study: End-to-End Cloud-based Compliance through Production Cloud-based Archiving & Regulatory Supervision to Meet SEC Rule 17a-4 and FINRA Integrated Supervision and Investigation Retention, Legal Hold, and ediscovery De-duplication, Review & Production managed in the cloud Autonomy Private Cloud Network of Secure Data Centers 24

25 Collection to the Cloud Search, identify, preserve and collect relevant ESI to the cloud from laptops, desktops and enterprise systems Enables organizations to meet preservation organization in the shortest amount of time Reduce both risk and cost 25

26 Conducting an ediscovery Requirements Analysis of Existing Process Is it repeatable? How do we send notifications? How do we collect? How does our process map to established best practices? How do we verify that we have put forth a good faith effort? What are the key trends and future issues that we need to be prepared for?

27 Implications for ediscovery Litigation holds on stored data Preservation of metadata (e.g., access and modification logs) Who bears the risk and cost of spoliation: provider or customer/ institution Who bears the risk if provider retains data that is subject to authorized destruction under pre-existing records retention schedules? 27

28 Implications for ediscovery (con t) What are search and retrieval capabilities of provider? What are the response times expected from the provider? How does ESI get produced for litigation? Third party ediscovery services access to data Privileged information: how protected? 28 Will data be encrypted?

29 Implications for ediscovery (con t) How will actions of cloud provider be monitored for compliance? Cross-border issues: data stored in foreign countries, limitations on access due to privacy laws, etc. 29

30 Cloud Computing Service Level Agreements Terms of service: Use of data Location of data No change of terms Destruction Ownership (assignment) Subpoena Audits 30

31 Choosing an ediscovery Solution ediscovery and Information Governance Provider Analysis How Much of the Process to Bring In-House Conduct analysis of cloud vs. technology vendors Review the potential benefits of a hybrid cloud/in house process ROI Analysis Evaluating a Technology and Making a Purchase Decision Proof of concepts, pros and cons Paid Pilots References

32 Cloud Computing, Here to Stay? 32

33 Thank you for attending another presentation from ACC s Desktop Learning Webcasts Please be sure to complete the evaluation form for this program as your comments and ideas are helpful in planning future programs. If you have questions about this or future webcasts, please contact ACC at This and other ACC webcasts have been recorded and are available, for one year after the presentation date, as archived webcasts at

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