Using Predictive Coding to Your E-Discovery Advantage

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1 1EDITOR S NOTE VIRTUALIZATION CLOUD APPLICATION DEVELOPMENT NETWORKING STORAGE ARCHITECTURE DATA CENTER MANAGEMENT BI APPLICATIONS DISASTER RECOVERY/COMPLIANCE SECURITY Handbook Using to Your Advantage The big data explosion creates numerous information management and legal concerns for modern organizations, but new data management practices are proving beneficial to compliance processes. 2PREDICTIVE CODING: IT S NOT JUST FOR E-DISCOVERY ANYMORE 3THE VALUE OF THE HUMAN EYE IN PREDICTIVE CODING 4DATA DISCOVERY TOOLS DONE RIGHT

2 1 EDITOR S NOTE Have I Got a Prediction for You. Big data is a buzzword with both positive and negative connotations. Social media, the cloud and mobility create numerous business benefits: an increased ability to engage with customers, conduct business more quickly and create a more flexible workforce, to name just a few. With these benefits, however, come many concerns, especially from a legal perspective. Businesses are now responsible for keeping track of and securing an endless amount of data, and this data is stored in a seemingly endless number of places. During a legal dispute, this can make e-discovery of specific information a difficult and expensive task. But e-discovery best practices are emerging that can make this process easier on organizations. Predictive coding is one relatively new but increasingly popular strategy in the legal world that uses a combination of machine-learning technology and workflow processes to automate portions of e-discovery document review. If incorporated correctly, predictive coding and other e-discovery practices can ultimately benefit a host of other business areas, including organization-wide information governance. In this SearchCompliance handbook, we examine predictive coding in depth and discuss how this and other e-discovery processes can improve the business as a whole. 2 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

3 1 EDITOR S NOTE In our first article,, ARMA CEO Marilyn Bier explains how predictive coding optimizes e-discovery and information governance, as well as searches for electronically stored information in the court of law. In our second article, author Christine Parizo examines why predictive coding cannot fully replace human review. And finally, in our last piece, I examine how thinking outside the box when it comes to e-discovery tools and strategies could change the face of information asset management. We hope you find this information useful as your business continues to navigate the big data landscape.n Ben Cole Editor, SearchCompliance 3 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

4 2 E-DISCOVERY PRACTICES By now, everyone in the world of information management is aware of the staggering increases in electronically stored information (ESI). Pundits and consultants often use colorful analogies to emphasize these remarkable numbers. Extreme predictions are routinely made and routinely replaced by predictions that are even more extreme. Obscure terms like exabytes and yottabytes are commonly summoned. There s a good reason the pundits and consultants are going through all this trouble to get our attention: poorly managed ESI poses very serious business and legal risks to an organization. MAXIMIZING VALUE, MINIMIZING RISKS Solid information governance is always the best approach to maximizing records and information as business assets and minimizing business risks. ARMA International defines information governance as a strategic framework composed of standards, processes, roles and metrics that hold organizations and individuals accountable to create, organize, secure, maintain, use and dispose of information 4 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

5 2 E-DISCOVERY PRACTICES in ways that align with and contribute to the organization s goals. Poor information governance will likely result in a data management disaster whereby records are lost, retained too long, disposed of improperly, made vulnerable to breaches, and subjected to other undesirable ends that weigh heavily on an organization s bottom line and its reputation. The explosion of ESI and the rigors of e-discovery have spawned many tools that promise to help organizations conquer the chaos of too much information. One evolving technology, called predictive coding, has proved useful for e-discovery and is gaining traction as a tool for managing information throughout its lifecycle. USING PREDICTIVE CODING FOR E-DISCOVERY The process of predictive coding is not new, but the technologies around it have been evolving rapidly to better address e-discovery, where the hours and dollars required to manually review thousands of documents in potentially thousands of locations can overwhelm some organizations. Using algorithms, predictive coding helps an organization get a better idea of what its data contains, thereby signaling its relevance to a particular e-discovery action. Also of note, the courts are showing some level of comfort with the practice of predictive coding for e-discovery. In the 2012 Da Silva Moore v. Publicis Groupe et al. action, for example, the defendant proposed using predictive coding technology 5 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

6 2 E-DISCOVERY PRACTICES to cull more than 3 million documents. After the plaintiff objected to the methodology, U.S. Magistrate Judge Andrew J. Peck (Southern District of New York) ruled that while predictive coding is not a magical solution in all cases, this judicial opinion now recognizes that computer-assisted review is an acceptable way to search for relevant ESI in appropriate cases. Last year, in Global Aerospace Inc. v. Landow Aviation LP, a Virginia circuit court allowed a defendant s request to use predictive coding in a document review that would otherwise require 10 man-years of billable time. USING PREDICTIVE CODING FOR INFORMATION GOVERNANCE Information professionals Leigh Isaacs and Doug Smith are among many who champion the use of predictive coding beyond the e-discovery arena. Isaacs, director of records and information governance at Orrick, Herrington & Sutcliffe LLP describes predictive coding in a recent Information Management article as an evolving technology that combines people, technology and workflows to find key documents and identify and review large data sets. It s a machinelearning technology that teaches the computer program to predict how to classify documents, based on human guidance, and the computer program then applies what it has learned to the universe of information. In the article, Isaacs explains how predictive coding increases information 6 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

7 2 E-DISCOVERY PRACTICES identification accuracy by pairing subject matter experts with predictive coding technologies. This pairing provides a solid foundation for defensible disposition and prevents content from being retained too long. The technologies can also help a company cull its data to identify valuable intellectual property; locate vital records and contracts that may have been misfiled; identify sensitive information for the purposes of protection and compliance; and much more. Smith, business manager at Wiley Rein LLP in Ashburn, Va., said in another Information Management article that predictive coding offers an alternative to the manual, subjective process of coding and quality review, which is laden with inefficiencies and inaccuracies. Predictive coding processes operate either through sampling or observing, both of which use human decisions as the calibrating mechanism, he said. Sampling is done by computer software that Sampling is done by computer software that randomly selects a subset of elec tronic records and presents it to a human coder for review. randomly selects a subset of electronic records and presents it to a human coder for review. The software monitors the coder s decisions, notes the characteristics of the records that are coded such as date, recipients and keywords and then uses these recorded decisions to predict the value of the remaining documents. 7 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

8 2 E-DISCOVERY PRACTICES In the observing process, the coding software monitors the decisions of human coders as they review records, and then predicts how a record will be coded before presenting it for coding. Next, it compares the predicted coding to the actual coding. Eventually, the software s predictive coding process reaches the accuracy level that s deemed acceptable based on pre-set policies. If an organization lacks proper information governance and hasn t conformed with the Generally Accepted Recordkeeping Principles, its ESI will not be in a legally defensible condition. Predictive coding can help remediate the problem by creating a classification schema that identifies and categorizes the information that s housed in unstructured or less-formal systems, Smith explains. ARMA International joins Isaacs and Smith in encouraging legal, IT and information management professionals to work together to consider predictive coding as another solution in the information governance toolkit. Marilyn Bier 8 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

9 3 PREDICTIVE CODING Human Eye in Less than a decade ago, the Federal Rules of Civil Procedure turned litigation on its head by including amendments defining e-discovery. Now, as the amount of data to sift through explodes due to social media and other big data sources, legal teams are turning toward predictive coding to find relevant materials. However, experts caution that while predictive coding tools can speed up the scanning process, they currently can t replace human review. Predictive coding isn t a new technology, according to Tom Barnett, managing director and e-discovery practice leader at New York-based digital risk management and investigation firm Stroz Friedberg LLC. Predictive coding as useful as it is and can be is 20th-century technology being used to solve a 19th-century problem based on 18th-century mathematics, he said. For the legal field, however, predictive coding is cutting-edge technology. And despite its age, predictive coding is very useful in the legal industry, Barnett said. Combined with other technologies such as data extraction, predictive coding can actually identify entities or pieces of data to find the proverbial needle in the haystack during discovery, he said. The volume of data in large litigation matters such as product liability 9 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

10 3 PREDICTIVE CODING necessitates using predictive coding, but smaller bankruptcy cases have also found predictive coding to be advantageous, said Jenna Aira-Ventrella, managing director of e-discovery at New York-based BDO Consulting. We re using and applying [predictive coding] in bankruptcies where the estate of the trustee doesn t have a huge amount of money to spend on e-discovery. PREDICTIVE CODING HELPS FIND ROGUE DOCUMENTS While reducing costs is one advantage of using predictive coding, another benefit is finding documents that a human reviewer may have missed, Aira-Ventrella said. The system needs to be trained to understand nuances in the documents, but once the software is programmed, it can find the same context in another document that has the same language and context nuances that the reviewer seeks, she said. This is key, because you might get a higher-level or more-focused subset of comments that are germane to [one] particular issue, whereas a reviewer who is not as trained or a junior reviewer might have missed the intricacies or perplexities of the issues, Aira-Ventrella said. Predictive coding also offers more consistency than human review if the system is properly programmed. One investigator may tag a document as nonresponsive, but another, more senior team member would categorize the document as relevant, 10 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

11 3 PREDICTIVE CODING Aira-Ventrella said. The system, if trained by senior reviewers, will flag relevant documents every time, she added. The key to consistency is making sure the right people are training the system, said David Sun, president of Washington, D.C.-based consultancy SunBlock Systems Inc. It s reliable in the sense that, whatever you tell it to do, it will do many times over. For example, a lawyer may tell a predictive coding system to only look for documents containing keywords, while a programmer may expand the keyword searches to include misspellings. COURTS SEE VALUE OF PREDICTIVE CODING Despite some lawyers reluctance to turn to technology, judges are seeing the value of using predictive coding when responding to document requests. The most significant has been in Global Aerospace Inc. et al. v. Landow Aviation, L.P. dba Dulles Jet Center, et al, Sun said. In that case, Judge James Chamblin of the 20th Judicial Circuit Court of Virginia ordered that the defendants could use predictive coding instead of human review to examine 2 million documents. What that does is open the door for lawyers in this case and all other cases out there, he said. That decision also allows attorneys to pass the buck to the judge if the predictive coding system doesn t find all of the relevant documents, according to Sun. 11 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

12 3 PREDICTIVE CODING Lawyers deal with finding fault, and the last thing they want is to be declared at fault. Now they can assign blame to the judge in this case, he said. If the technology stinks, they can point to the judge, saying, You approved it; sorry it didn t work out. Predictive coding court approval also creates opportunities for lawyers to agree how much they will use it and to what extent, particularly at Rule 26(f) conferences where both sides lay out their discovery plans, Sun said. The lawyers can determine what documents to search and at what level of relevancy like 70% or 80% they will consider responsive to their discovery requests. Lawyers will argue about a cutoff number. At the end of the day, it allows them, in a way that lawyers can work with, to argue over a number, Sun said. For example, during the Rule 26(f) conference, the lawyers could compromise and decide that both sides should produce documents that are in PDF format and keyword-searchable, and they would use predictive coding to identify documents that are at least 80% relevant in response to discovery requests, Sun said. It s another thing that potentially you could agree upon early enough in advance so that you don t worry about bickering and fighting down the road, he said. Christine Parizo 12 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

13 4 DATA TOOLS Electronic discovery processes provide numerous benefits from a legal standpoint, including the ability to seek, locate, secure and search data for use as evidence in a civil or criminal case. But could new and emerging e-discovery tools and processes provide these same benefits to business areas besides the legal department? The answer is a resounding yes, according to experts especially as organizations realize how the data classification, organization and security traits afforded by e-discovery processes can be applied to other areas. We now are seeing an entirely new recognition within corporate systems and government agencies that information is an asset and a new kind of property for the company, said Jeffrey Ritter, an author and lawyer who specializes in information management. It is the fuel with which they can manage and hone their business. By definition, e-discovery tools identify where an organization stores data, as well as what the data is used for, how it s distributed and by whom. If used correctly, e-discovery tools can be used to pinpoint this sensitive data and help develop processes to protect it. 13 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

14 4 DATA TOOLS Heidi Shey, an analyst at Cambridge, Mass.-based Forrester Research Inc., notes that if an organization can t even locate where it stores its sensitive information, its people won t know where to target data security efforts. Part of it is [organizations] don t know what data they have to begin with, where it resides and who gets to access it and use what, Shey said. Without that layer of information, it s a lot more difficult to start applying controls and policies over the use and the access to this data. E-discovery tools can be used to streamline processes and automate enforcement in a wide variety of business areas, including data security, according to Shey. A Forrester report she co-wrote earlier this year, titled Know Your Data to Create Actionable Policy, states that applying identity and tagging data packets with identity attributes allows businesses to determine how critical any piece of data is and, in turn, protect it more effectively. In order to protect data, an organization needs to know who owns it. In order to protect data, an organization needs to know who owns it who created it within the business and where it s located, Shey said. The Forrester report notes that network analysis and visibility and data loss prevention (DLP) tools can help discover data so that it can be properly identified and classified. The data discovered using these tools can also be fed into security analytics to 14 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

15 4 DATA TOOLS help the enterprise know where to look for toxic data. These DLP tools can help control data by enforcing predetermined policies once the upfront work of defining the data is completed. This is something that a lot of the e-discovery vendor solutions should consider I think it would be helpful from a data security perspective, Shey said. It s one of those things where they ve got the capabilities in their products, but if we think about what it s actually doing, there are different applications for it. E-DISCOVERY S BOTTOM-LINE BENEFITS The business benefits of e-discovery processes go beyond data security. Employee training, data governance, customer information management all could potentially benefit if e-discovery tools and processes are incorporated into general data governance processes. Carl Weise, an industry advisor at Silver Springs, Md.-based AIIM International, notes that the deduplication of processes afforded by e-discovery is a huge boost to businesses. In other words, e-discovery tools can be used to identify duplicate, and near-duplicate, copies of data so companies can streamline information and procedures. You can actually go in and identify exact copies [of information], and then cut down on volume, Weise said. It s a wonderful return on investment to reduce 15 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

16 4 DATA TOOLS storage costs and, of course, the data management costs. Automatic classification and categorization of data, two other tools commonly used in e-discovery, are other processes that could be used in everyday information governance and records management long before there is any litigation or government investigation, Weise added. E-discovery tools can also identify where data resides and how it s being used in the organization, providing valuable points of reference for areas besides the legal department. The key is to plan ahead when it comes to data discovery, Ritter said. Electronic information can be far more reliable, far more accessible as historical evidence, and more appropriately managed if we actually design the expectation into the way we build systems and software and storage services, so that we anticipate we will need to call on that information to support all types of needs within the business, Ritter said. If done correctly, proper e-discovery can even boost the bottom line. A 2012 Forrester report, titled Control and Protect Sensitive Information In The Era Of Big Data, states that e-discovery and security teams often engage in separate data discovery and classification projects that the organization could combine to create efficiencies, reduce costs and improve visibility. If done correctly, proper e-discovery can even boost the bottom line. This unified approach to data discovery and classification allows for better 16 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

17 4 DATA TOOLS archiving and allows the company to delete large volumes of unnecessary data before applying security controls such as encryption, tokenization and rights management, according to the Forrester report. This outside-the-box thinking around e-discovery tools boosts cooperation within the company and can ultimately help consolidate resources, Shey said. If you can say that this is something that s going to help us do better data security, create better policy around how we are going to protect our data, that might expand the pool of groups [and] business units within the company that would want this you can start pooling together budget, Shey said. It just opens up more possibilities. Ben Cole 17 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE

18 ABOUT THE AUTHORS MARILYN BIER is CEO of ARMA International, an authority on governing and managing information as critical business assets. As a not-forprofit professional association founded in 1955, it provides its 10,000-plus global members and countless external customers the education, publications and resources they need to be able to create, organize, secure, maintain, use and dispose of information in ways that align with and contribute to their organization s goals. CHRISTINE PARIZO is a freelance writer specializing in business and technology features for a variety of publications, as well as case studies and white papers for business-to-business technology companies. Christine has a background in litigation technology and compliance and was previously an assistant news editor for searchcrm.com. BEN COLE is associate editor for SearchCompliance.com. He covers IT executive strategies for information governance, regulatory compliance and risk management. Prior to joining TechTarget, Ben was the online editor for HealthLeaders Media, based in Marblehead, Mass. He began his journalism career as a reporter with the Massachusetts daily newspapers The Gardner News and the Sentinel and Enterprise. Using to Your Advantage is a SearchCompliance.com e-publication. Christina Torode Editorial Director Wendy Schuchart Senior Site Editor Rachel Lebeaux Managing Editor Ben Cole Associate Editor Marilyn Bier, Christine Parizo Contributing Writers Linda Koury Director of Online Design Neva Maniscalco Graphic Designer Amalie Keerl Director of Product Management akeerl@techtarget.com TechTarget 275 Grove Street, Newton, MA TechTarget Inc. No part of this publication may be transmitted or reproduced in any form or by any means without written permission from the publisher. TechTarget reprints are available through The YGS Group. About TechTarget: TechTarget publishes media for information technology professionals. More than 100 focused websites enable quick access to a deep store of news, advice and analysis about the technologies, products and processes crucial to your job. Our live and virtual events give you direct access to independent expert commentary and advice. At IT Knowledge Exchange, our social community, you can get advice and share solutions with peers and experts. 18 USING PREDICTIVE CODING TO YOUR E-DISCOVERY ADVANTAGE