Presentation given January 26th, 2009 at the 19th Annual AIIM Minnesota 'Control' event by Bill Tolson of Mimosa systems.

1. Pre-emptive
Pre emptive eDiscovery Strategies
for Small, Medium and Large entities
Bill Tolson
Director of Legal Solutions Marketing
f S
Mimosa Systems Inc.
Copyright © 2009 Mimosa Systems, Inc. - Confidential

2. “Receiving a discovery request is like being
pulled over for a broken headlight and
having f ll b d
h i a full body cavity search done.”
it hd ”
Unknown CEO
Uk

3. Discovery doesn’t have to be
traumatic or costly… if you
proactively plan for it

4. Most Frequently Requested Record Types in
Discovery
y
E-mail ( d attachments )
E il (and tt h t 80%
General office productivity documents 60%
Databas e records 49%
Invoices and other customer records 41%
Financial statements 36%
Telephone call recordings and other audio files 29%
Digital images 25%
Ins tant mes sages 21%
Video files 16%
Other 5%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
ESG Research Discovery Survey Nov 2007
4

5. Average Age of Data Requested During
Discovery (
y (General Counsel Survey)
y)
60%
48%
50%
40%
30%
20%
15% 15% 15%
10%
4% 4%
0%
Most data is Most data is Most data is Most data is Most data is Don't know /
less than 6 between 6 and between 12 between 24 more than 36 refused to
months old 12 months old and 24 months and 36 months months old answer
old old
ESG Research Discovery Survey Nov 2007
5

6. ESI eDiscovery Trends:
More Costly, More Complicated
y, p
The legal problem is immense for large, midsize and small
companies:
Among midsize companies, 98% had between 1 and 20 $20-million
lawsuits; the other 2% had between 21 and 50.
58% of companies had between 1 and 50 new lawsuits in 2007.
Almost 40% of the largest companies surveyed spent $5 million or
more annually on litigation.
* Source: 2007 Fulbright & Jaworski Litigation Trends Survey
A growing body of case law and judgments affects IT:
Victor Stanley Inc v Creative Pipe Inc 2008 WL 2221841 (D Md May 29
Stanley, Inc. v. Pipe, Inc., (D.Md. 29,
2008) —risks of keyword search
Hopson v. Mayor of Baltimore, 232 FRD 228 (D. Md. 2005) —parties ordered to
create a reasonable discovery plan

7. eDiscovery is a Problem
The American Bar Association Digital Evidence Project and
National Law Journal Report:
Over 30 Billion emails are sent daily
Over 90% of ALL information is now electronic
Typical Fortune 500 company has 125 on going cases with at least 75%
on-going
requiring electronic discovery
62% of companies surveyed doubt they can show their electronic records
are accurate and reliable

8. The Federal Rules of Civil Procedure

9. The New FRCP Amendments..
Explicitly makes “electronically stored
information” a category of discoverable d t
if ti ” t f di bl data
Mandates early meet-and-confer sessions
Provides “safe harbor” in the event of “good
faith” destruction of discoverable data
Litigation Hold expectations

10. So, What is Discoverable and Subject to
Litigation Holds?
g
Email
Calendars
Attachments
Files Contacts
Task Lists
Anything else? Specific Points in Time
Conversation Threads
File Attributes
Metadata
Backup Tapes

11. Major Risks Associated with ESI in
Litigation
g
Stopping system managed deletions
Stopping deletion of potentially responsive
Electronically Stored Information (ESI) by
employees
l
Applying a Litigation Hold
Inability to effectively filter ESI to determine
responsiveness, or privilege
Not turning over all responsive ESI
Turning over too much ESI

12. Major Costs Associated with ESI in Litigation
Searching for responsive ESI in the corporate
infrastructure
if t t
File Servers
On-line
On line Storage Systems
Failover Locations
Email Servers
Instant Messaging Servers
Backup Tapes
Network Share Drives

13. Major Costs Associated with ESI in Litigation
Searching for responsive ESI at the custodian
level
l l
Custodian Workstations PDAs
Custodian Laptops Cell Phones
CD/DVDs iPods
USB Thumb Drives Digital Cameras
External Hard disks Personal Email Accounts
Home PCs

14. Challenges for eDiscovery
Managing Legal Risk
Litigation Hold - Spoliation
Turning over too much data – Privilege
Turning over too little data – Adverse Inference
Managing Legal Cost
Stopping deletions is costly to ensure
Slow eDiscovery response results in severe penalties and fines
Disruptive data capture decreases employee productivity
Restoration of backup tapes for searching is extremely costly

15. New eDiscovery Case Law
Best Buy Stores, L.P. v. Developers Diversified Realty Corp., 2007 WL
333987 (D Minn Feb 1 2007)
(D. Minn. Feb. 1,
Backup tapes are not inaccessible: “Defendants offer no proof, aside from
conclusory statements, about the cost to obtain documents from electronic
archives. So this concern cannot shield the defendants from discovery here.”
Columbia Pictures Industries v. Bunnell, CV 06-1093 FMC (JCx), U.S.
District Court for the Central District of California (May 2007)
(y )
Server transaction logs are discoverable: An issue addressed by the judge was
whether requiring the defendants to preserve and produce the server log data was
tantamount to forcing them to create new data, since the defendants' systems had
not created these types of logs before.
t t d th t fl bf

16. New eDiscovery Case Law
Goodbys Creek, LLC v. Arch Ins.., 2008 WL 4279693 (M.D. Fla.
Sept. 15, 2008)
…in a reasonably usable form does not mean that a responding party is free to
convert electronically stored information from the form in which it is ordinarily
maintained to a different form that makes it more difficult or burdensome for
the requesting party to use the information efficiently in the litigation.
Metrokane, Inc. v. Built NY, Inc., 2008 WL 4185865 (S.D.N.Y. Sept.
3, 2008)
Adverse Inference and Other Sanctions Warranted for Plaintiff's Failure to
Produce Damaging Emails that were Eventually Produced by Third Party
Magistrate Judge Michael H. Dolinger rejected Metrokane’s procedural
defense, and concluded that BNY sufficiently demonstrated discovery
misconduct by Metrokane and resulting prejudice. Accordingly, the court
granted a variety of remedies including an adverse inference instruction
remedies, instruction.

17. New eDiscovery Case Law
White v. Graceland Coll. Ctr. for Prof’l Dev. & Lifelong Learning,
Inc., 2008 WL 3271924 (D. Kan. Aug. 7, 2008)
The Court finds that Defendants failed to produce the emails and attachments
in either the form in which they are ordinarily maintained, or in a quot;reasonably
usable form,quot; as required by Rule 34(b)(2)(E)(ii). Defendants' conversion of
the emails and attachments to PDF documents and production of the PDF
documents in paper format does not comply with the option to produce them in
a reasonable usable form.
Bright v. United Corp., 2008 WL 2971769 (V.I. July 22, 2008)
Supermarket's Failure to Retain Video Surveillance Footage of Periods
Preceding and Following Slip and Fall Incident quot;Shocks the Conscience of the
Shocks
Courtquot; and Warrants Adverse Inference Instruction

18. The Cost of Review
quot;A recent study that appeared in Digital Discovery & e-
Evidence showed that for a smaller case with 30
that,
gigabytes of data, manual review could cost $3.3
million. The study described how a more advanced
electronic approach could reduce that cost by 89%, to
less than $360,000. See 'Document Analytics Allow
Attorneys to be Attorneys,'
y y,
(Chris Paskach and Vince Walden, DDEE, August 2005,
page 10.)quot;

19. Challenges for eDiscovery – Manual Process
Manual Discovery is risky as well as time
consuming and di
i d disruptive - costly
ti tl
Responsive records can be anywhere
Impossible to place a litigation hold quickly and
completely
How can you be sure all targeted employees have
y g py
stopped deletions of potentially responsive content?
Did I find everything?
19

20. Challenges for eDiscovery – Manual Process
Email Boxes
Exchange Dumpster
Backup Tapes
CDs/DVDs
Email Server PDAs
Custodian Workstations
`
eDiscovery Order
File Server
Thumb Drives
MP3s/iPods
Share Drives
Digital Cameras

21. Challenges for eDiscovery – Reactive
Solutions (Crawling)
( g)
Reactive Discovery is risky, time consuming and
disruptive t th i f t t
di ti to the infrastructure
Again, responsive records can be anywhere
Impossible to place a litigation hold quickly and
completely
Reactive crawls and hard disk imaging is disruptive
gg p
to custodian productivity
Did I find everything?
21

22. Challenges for eDiscovery - Archiving
First generation archiving solutions don’t address
the question – What’s discoverable?
What s
Incomplete capture of historical data
If you don’t capture everything then your
don t everything,
litigation hold will be incomplete
Cumbersome and complicated eDiscovery
Doesn t
Doesn’t capture all discoverable data
22

23. Proactive Archiving of all Discoverable
Data
Advantages of proactive archiving for discovery
over manual di
l discovery or reactive crawling
ti li
Ability to perform early case assessment – data is
always at hand
Place litigation holds immediately
Disposition of records is automatically managed
p y g
Data is single-instanced so only one copy exists
Archive provides a data inventory for “meet and
confer” session
Archive provides a “Single Point of Discovery” for
email and file system data

24. Disadvantages
Archive storage requirements
But…
How much of your tier one storage resources is being
consumed with PSTs and duplicates of office files?
What's your real cost of manual or reactive
y
discovery?

25. The Biggest Argument Against Archiving
from Corporate Legal…
p g
“The more data we keep the bigger the chance
it will be used against us in litigation”
Not necessarily the case…

26. Employees Keep Stuff No Matter
Employees will keep data for all kinds of
reasons
Employees will not adhere to retention policies
on d t they squirrel away
data th il
With no centralized management, thousands of
copies can exist for long periods of time
exist…for
All this does is d i up you di
thi d i drive discovery cost
t

27. Blanket Retention Policies –
Unsafe Harbors
“We save everything until our mail
server gets full – then we delete
everything and start anew.”
anew.
“We save everything for 30 (60 or 90)
days and we’ve never h d a problem.”
d d ’ had bl ”
“We gave up trying to figure out
We
individual retention rules and now keep
everything for 10 (15 or 20) years.”
(202) 342-2550
bsavarino@cohenmohr.com

28. Discovery Strategies for Small Entities
Control your organizations data – all of it
Know your infrastructure
Know what data is created and deleted
Be able to lock it down quickly
Judges don’t care what you can afford
Get outside legal advice – legal advice is an
insurance policy If a lawyer told you it was
policy.
alright, then you are better off
Get that advice in writing
g

29. Discovery Strategies for Small Entities
Create policies and procedures
Create a litigation hold process
Create a eDiscovery process
Create a ESI retention policy
Test all of them
Train employees on all policies
Audit employee compliance
And document everything
y g

30. Discovery Strategies for Medium and Large
Entities
Control your organizations data – all of it
This includes video surveillance
Entrance/exit card access
Put a centrally controlled ESI archive in place
If multinational, be aware of international data
retention precautions
p
Get internal or external legal advice
g

31. Discovery Strategies for Medium and Large
Entities
Inventory your data infrastructure
What applications are used that create data
Where is the data stored
How many copies are stored
Do any of the systems have an automatic disposition process
Do you have systems where the employee has the ability to
keep a copy locally
Create a data map and keep it updated
Understand you regulatory retention
requirements

32. Discovery Strategies for Medium and Large
Entities
Create records retention policies. Policy(s)
should b i place and i l
h ld be in l d implemented well i
td ll in
advance of any potential or actual litigation or
investigation 3 month retention
Inbox
2 year retention
Project 1
Project 2 3 year retention
Project 3 1 year retention after deletion
Sent Items 6 month retention

33. Discovery Strategies for Medium and Large
Entities
Legally refresh the policies on a regular basis
Prohibit the creation of employee PSTs
Disable workstation CD/DVD drives and USB
connections
Hold regular update meetings for corporate
legal and IT
l ld
Train all employees on the policies
Document everything

34. Discovery Strategies for Medium and Large
Entities
Prepare your employees for questioning from
the th
th other side…
id
Interrogatories are written and sometime in-person
questions posed by the opposing counsel that are
designed to discover key facts about an opposing
party's case.
For IT, this usually will include questions relating to
the corporate infrastructure.
infrastructure

35. Summary
Proactively archiving ESI including email and
office files reduces di
ffi fil d discovery costs and risks
t dik
Applying policies to archived data insures data
doesn’t stick around forever
Preparing for discovery ahead of time puts you
in better
i a b tt position when liti ti starts
iti h litigation t t

36. Questions?

37. NearPoint Key Differentiators
Unified backend for all user generated content types
Centralized control of retention policies and litigation holds
Consolidated view for eDiscovery
Granular policy definitions
Advanced seamless and shortcut style stubbing
technology
gy
Flexible file recovery mechanisms for administrators
Advanced reporting, monitoring and alerting functionality
37

38. Where NearPoint Fits in the eDiscovery
Ecosystem
y
NearPoint eDiscovery Option
(eDO) – search, review, tag and
set legal hold on potentially
g y
responsive content
NearPoint Archive for File
and Email Systems Processing
Preservation
Information
Identification Review Production Presentation
Management
•C t Collection
Capture
• Archive
• Retain Analysis
• Dispose
• Monitor
NearPoint
Custodian
Collector
Option (CCO) –
helps with
reactive
Electronic Discovery Reference Model
collection of
www.edrm.net
historical file
and desktop
content 38
38

39. eDiscovery with Mimosa NearPoint
eDiscovery
Request
Mimosa N P i t A hi
Mi NearPoint Archive
captures all discoverable content
in real near-time
Email Server
Mimosa NearPoint Archive Server
Single P i t f Di
Si l Point of Discovery
File Server
Using the eDiscovery Option, the legal
Option Single Instance
staff can search for, review, tag and Archive Storage
and Index
place litigation holds as well as export
responsive records for external legal
counsel, plaintiff’s attorney or
importation into case management tool.
The IT department is not required in any
steps