Reducing E-Discovery Costs: Part 1

This is the first post in a series that spotlights two solutions that can help meet the challenge of reducing e-discovery costs.

Although it has produced a sea change in the practice of litigation, electronic discovery has also contributed to rising costs due to the massive amount of data that people and organizations generate every day – voluntarily or otherwise.

Hiring document review attorneys to pore over thousands (or millions) of emails or comb through reams of electronically stored information is often cost-prohibitive, even for large firms and corporations. Electronic discovery is one of the most costly aspects of litigation, with a typical medium-sized lawsuit costing parties between $2.5 million and $3.5 million.¹

In the past few years, the sheer volume of written and digital communications has drastically increased. In a digital world where we are connected at home, on the job, and on the road, more and more data from a variety of sources can shed light on a defendant’s activities and serve as evidence in a trial. But the jump in volume and types of data also presents unprecedented challenges ‒ and expense ‒ for attorneys and the organizations that house such data.

There is business and regulatory pressure to mitigate these expenditures. In addition to internal budget considerations, law firms and in-house legal departments must follow government mandates, such as the 2015 Federal Rules of Civil Procedure, to reduce discovery time and costs while reaching just resolution of cases.² While mishandling and inefficiencies can lead to higher costs, penalties, and lost revenue, narrowing discovery requests to relevant data can reduce costs and time spent.

When organizations begin to proactively shift their record management systems to an information governance framework and leverage technology tools such as technology-assisted review (TAR), they will get closer to solving the cost problem.

The main factor driving up costs in e-discovery is the document review phase, which accounts for more than half of expenses. The RAND Institute for Civil Justice determined that the review phase accounts for about 73 percent of e-discovery costs. During this phase, electronic documents are evaluated to determine if they are responsive, privileged, or confidential.

In my next post we’ll examine some other reasons why e-discovery is so expensive. In the meantime, feel free to visit the Legal Services page of our website for further information on industry trends and best practices including case histories, white papers and more.

____________________

• Karel Mazanec, “Capping E-Discovery Costs: A Hybrid Solution to E- Discovery Abuse,” 56 Wm. & Mary L. Rev. 642, 2014
• Jesse E. Weisshaar and Mark w. Cowing, “Amendments to Discovery Rules: How will You Be Affected?” Bloomberg Law Insights, November 25, 2015; and Michele C.S. Lange, “How This Year’s Experience with the New Rules will Shape Next Year’s E-Discovery,” Bloomberg Law, December 28, 2016