Managing E-Discovery Costs with Managed Review

May 6, 2013 Rachel Teisch

Managing e-discovery costs was a salient topic at last week’s Carmel Valley eDiscovery Retreat in Half Moon Bay, CA, with a number of panels offering insights into how to align financial interests among clients, law firms and e-discovery providers.

In many cases, one way to do so is managed review. When a matter involves an extensive data collection, corporate legal departments must decide which parts of the e-discovery process to insource and which to outsource for the sake of efficiency. Since many clients choose to outsource the document review phase, the next question becomes whether to delegate the responsibility to outside counsel or to contract attorneys managed by an e-discovery services provider.

In the most efficient outsourcing models, corporate law departments retain control of broad issues such as case strategy but delegate day-to-day oversight of legal matters to outside counsel. Then, either the law firm or the legal department sends the time-intensive aspects of the work, such as document review, to a service provider. Of course, managed review should not be mistaken as an invitation to abdicate complete control over the review process: in fact, in Peerless Industries, Inc. v. Crimson AV, LLC (N.D. Ill. Jan. 8, 2013), the court sanctioned a party that failed to supervise its vendor’s e-discovery process, ruling that the “hands-off” approach to the document production was insufficient.

Outsourcing document review to a provider has a number of advantages. By outsourcing document review to a single provider, instead of various law firms, in-house counsel can reduce the likelihood of inconsistency and the chances of errors, omissions, and sanctions. And if an e-discovery service provider with end-to-end e-discovery services conducts the review, information is not continuously shuffled, which can prevent the inadvertent destruction of data. In addition, when a law department relies on the same vendor for multiple matters, its review team members develop institutional knowledge of the client’s preferences and best practices protocols and procedures, allowing for optimal results.

Managed review teams can also leverage cutting-edge technology to minimize review time, such as technology-assisted review, without the legal department (or law firm) having to invest in technology they might not have in-house. They can also offer predictable pricing models to control costs. And, as one court recently remarked in allowing a party to recover nearly $400,000 to cover the costs of document review performed by a vendor’s contract attorneys, managed review can minimize the exorbitant costs of e-discovery. (As part of its award in Gabriel Technologies Corp. v. Qualcomm, Inc., (S.D. Cal. Feb. 1, 2013), the court acknowledged that had the defendant not outsourced document review, its attorneys’ fees would have been substantially higher.)

Rachel Teisch is vice president, marketing at Conduent. She can be reached at info@conduent.com.

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