Wednesday, October 7, 2009

Regulations, paperwork spark growth in e-discovery

By Jim Schakenbach, Special to Mass High Tech

Video Gallery

MHT's Rodney Brown: App developers see opportunity in new iPhone

MHT's Galen Moore: Service allows customers to pay taxi via cell phone

MHT's Galen Moore: Charities score with online fundraising

Related News

Blog: With Komen and SOPA, the web has finally grown up [February 3, 2012]

PC Connection names Driscoll as new CFO [February 3, 2012]

LeveragePoint leverages backers for $713K more [February 3, 2012]

Zipcar buys majority stake in Spain’s Avancar [February 2, 2012]

Silverlink socks away $2M in new funding round [January 31, 2012]

If you’re involved in corporate legal matters you couldn’t help but notice the explosion of data and paperwork in recent years.

With increased state and federal regulatory legislation such as the Sarbanes-Oxley Act, companies have been put on notice that electronic-document retention and management can no longer be treated lightly. The courts take a dim view of any company that handles its files haphazardly, leveraging hefty fines — some in the multimillions of dollars — and sanctions against firms that cannot produce documentation related to litigation.

Companies and their law firms find themselves struggling to process tens of thousands of case-related documents stored in dozens of electronic locations. As a result, the e-discovery marketplace is expected by some observers to grow 25 to 30 percent a year through 2010, according to published reports. Law firms are beefing up their IT departments and, in some cases, hiring attorneys to handle all matters related to electronic data.

“E-discovery basically encompasses anything that has to do with digital information as it applies to the litigation process,” says Shannon Capone Kirk, e-discovery counsel for Ropes & Gray LLP. Kirk, who was perhaps the first dedicated e-discovery attorney in the country, has seen e-discovery morph in just a few years from a litigation-stage process to a more general e-data management process.

“E-discovery can now be viewed as including the proper treatment of business e-data – both its retention and disposal,” said Kirk, whose firm uses a combination of in-house, vendor-hosted, and licensed software to handle the various tasks necessary to process and manage a variety of data files and documents. “It’s a full time job to handle all data relative to e-discovery now. As an attorney, it’s difficult to be an expert on the law and stay on top of technology. Clients now have to rely on both legal and technology experts in a law firm.”

But e-discovery is only one aspect of the electronic dilemma law firms face. There is case management and document automation, among others. James Donnelly, a partner in Worcester-based Mirick, O’Connell, DeMallie & Lougee LLP says his firm uses several products from litigation-support software company CT Summation Inc. of San Francisco to help prepare cases.

“Documents such as e-mail are proliferating at an exponential rate, and it’s getting cost prohibitive to process” without electronic help, says Donnelly. “Software helps us get control of the document universe and provides better document management.”

Litigation support comes in other forms as well. Companies like Westwood-based Brightleaf Corp. provide software to automate much of the paperwork involved in legal engagements.

Document automation enables attorneys to “practice more and process less,” says Luke O’Brien, senior corporate counsel and VP of strategy for Brightleaf. “Documentation has exploded and clients don’t like to pay for ‘busy work.’ ”

Litigation support & e-discovery in the region

Jim Schakenbach is a freelance writer in Jefferson.