As the new year approaches, many are wondering what e-discovery will look like in 2009. The question is now generating some interesting discussion in the blogosphere. I think Ralph Losey hit the key issue on the head this last week in a comment posted to EDD Update. The thrust of the post is that litigation will be on the rise next year, but that corporate budgets will be tighter, leading everyone to look for ways to make the e-discovery process more efficient and cost-effective.
In discussing the effects that leaner budgets will have on the e-discovery process, Losey makes, among others, two important predictions. The first is that we will see "an explosion of metrics and proportionality arguments to drastically reduce the amount of ESI to be reviewed and produced." The second is that in-house counsel may "finally become selective and pick new lawyers that get it, instead of their old stand-byes that don't." On the latter point, he further offers his "doubt [that] the budget will permit the cronyism system to continue."
I fully agree with Losey's prediction that companies will have to rethink their e-discovery choices, but I think there is more to be said about how to make smart decisions when it comes to e-discovery. To be sure, every company - and outside counsel - should already be looking at ways to achieve measurable efficiencies when it comes to e-discovery. And certainly, companies will be taking a harder look at the outside counsel they hire to do this work. As Losey suggests, some firms "get it," while others don't. A law firm with experience can really make the e-discovery process much more efficient, and much less expensive. For this reason, we're already seeing many companies move towards hiring national e-discovery counsel. I am confident that these trends will continue, especially in a tight economic market.
I am concerned, however, that tighter budgets may lead to the slowing, or even the reversal of another very important trend - that is, the trend towards taking a proactive approach to e-discovery issues. A quick example illustrates the point. In recent years, many companies have realized the benefit of creating a plan for managing, and responding to discovery requests that call for their electronic data. As part of that process, companies map their networks, so they know where their data is, and develop protocols for responding to requests for electronic discovery. As budgets tighten, some companies may not be willing to pay the up-front cost of developing these data management plans. In doing so, companies who are trying to save money may be making a costly mistake. The worst time to begin the process of understanding your network - where you have data, how it is stored, how to retrieve it efficiently - is when you are in the middle of litigation and have to respond to discovery requests. Litigation moves too quickly and gathering electronic data can be a time consuming process. In the rush to comply with demands for electronic discovery, those who have not planned ahead will not be able to think through their response as thoroughly, and will almost certainly see inefficiencies, work that has to be redone, or costly errors, as a result.
Making the right e-discovery decision will often mean different things for different companies. What is universal, however, is that the best decisions are usually made by those companies that have the best advice from those who really understand the e-discovery process. As Losey suggests in his post, those who understand the process will be the ones who have the competitive edge. That will be particularly true in the tight economy of 2009.