It Pays to Use Formal Discovery

Preparing for litigation comes with a mountain of expenses and challenges —much of which are attributable to discovery. And, as data volumes grow, so too, do those discovery costs. Unfortunately, eDiscovery is often misunderstood by clients and rationalized to be more complicated than it needs to be.

In an effort to contain the rising tide of costs and perceived complexity, some litigants are undertaking “informal discovery” — a process that on its face seems like a cost-effective and ideal option. It allows for the exchange of key documents without the burden of production format, custodian tracking or consideration for defensibility. In a common scenario the client will comb through their own inbox and send the relevant emails to counsel.

Sounds like a good deal, right?

“Clients don’t like the idea of paying money for things that they believe they can do themselves,” says Greg Cancilla, Director of Forensics at RVM Enterprises. “Collecting data can seem more like a job for an intern than an eDiscovery and legal forensics firm.”

Although it might seem like a cost-effective approach, parties that engage this way may be in for trouble.

The Trouble with Informal Discovery

Common Missteps in Informal Discovery
Self-selection of relevant documents
Self-collection of ESI
Emailing documents to counsel as attachments
Copying and pasting files to external media or an FTP site
Producing ESI by a) printing to hard copy or b) converting the files to .pdf
Bates numbering documents individually

A major concern with informal discovery is the risk exposure regarding authentication of evidence and the potential extra time and costs one might incur to correct the collection of data.  While eDiscovery providers have developed systems and technologies that enable them to work quickly and efficiently in an appropriate review environment, an informal approach does not offer those advantages. eDiscovery providers take the appropriate time and use the correct processes to collect data so that it can be done once, efficiently, and defensibly. With informal discovery, if further searches are warranted, the entire process may need to be repeated, adding undesirable costs and time.

Another issue is the likelihood of altering metadata. By using the “copy and paste” — or “foldering” —approach to data collection, you run the risk of modifying key dates such as last opened, last modified, etc. This can make authentication problematic, and makes it harder to sort and de-dupe files that have been modified, again adding to cost.

The most important shortcoming of the informal method is the unnecessary risk of misstating the scope of the production of electronically stored information (ESI). (Applied Underwriters, Inc. v. American Employer Group). In some circumstances, courts have held that self-identification and collection may not even be defensible.

According to Cancilla, “Self-collection puts all the responsibility on the custodian to determine what ESI is relevant. Foldering in particular can be troubling, as even well-intentioned clients may simply not realize that certain sources, a sent mail box for example, need to be included in the folder to be produced.”  In today’s age of electronic information, it is important to note that relevant information is not just the substance of the document, but also the metadata — or surrounding information — of the document.  FRCP Rule 34(b)(2)(E) advises that a party must produce documents “as they are kept in the usual course of business” or must “organize and label them to correspond to the categories in the request.”  “Informal Discovery” adversely impacts that instruction.

Changes on the Horizon

Two proposed amendments to Federal Rule of Evidence 902 are set to take effect on December 1, 2017 that will significantly affect the collection of ESI and its admissibility. In addition to providing a structure for standardizing ESI collection, these amendments, 902(13) and 902(14) demand a stricter, more organized method of collection that is outside the scope of informal eDiscovery. Where the current version of Rule 902 allows for self-authentication of certain types of documents, the new additions allow for authentication of electronic evidence by an affidavit of a “qualified person” who can certify in writing that the document was obtained with the requirements of Rule 902(11) and (12).

“The new rules are changing everything,” continues Cancilla. “It doesn’t make any attempt to disincentivize self-collecting, but by making ESI gained through formal discovery ‘self-authenticating,’ the advantages are well worth any cost to work with the professionals.”

The new rules cover records that can be authenticated using a document’s hash values, which are assumed to be unique. For purposes of authentication, hash values are the backbone of the proof that Rule 902 requires, but not the only allowable method. As the Advisory Committee on Evidence notes, “[t]he rule is flexible enough to allow certifications through processes other than comparison of hash value, including by other reliable means of identification provided by future technology.”

As December draws closer, parties must consider the implications of these rule changes and how they may affect authentication in upcoming trials. If they wish to take advantage of the new rules they must be prepared to track digital fingerprints on any new collection. If they don’t, they stand to spend more time and money authenticating their documents, including having their own in-house IT and network administration staff called to testify.

Says Cancilla, “Using the informal method of discovery is like driving with too little insurance: you’ll save money for a while, but if anything bad happens, you could wind up paying for it. Companies should remember that a well-documented and formalized data collection process is a small investment relative to the overall eDiscovery spend, but can significantly affect accuracy and defensibility.”

###

Greg Cancilla, EnCE, ACE is a Certified Computer Forensic Engineer and the Director of Forensics at RVM. He has performed countless digital forensics investigations since entering the field in 2003. Additionally, Greg has offered testimony in numerous cases, including presenting a key piece of evidence in Ronald Luri v. Republic Services, Inc., et al., which rendered the largest verdict in the State of Ohio’s history.

Leave a Reply