E-Discovery and the Importance of Having a Records Retention Program that Includes Electronic Records

Discovery: the act or process of discovering.[1] In a lawsuit, discovery is the process of sharing information that is relevant to a particular legal action or proceeding. With the rapid growth of technology and electronic data, the discovery process has evolved to include a new way of discovering information: electronic discovery or “e-discovery.” Why all the buzz about e-discovery? Computers are being used now more than ever by families, businesses, lawyers, doctors and even the courts. Computers allow us to work more efficiently, cut costs, communicate and store large amounts of data. It is important for a business to be able to quickly review and extract information, but the large amounts of data being stored can make this task difficult, especially in the event of a lawsuit.

E-discovery is “the process of collecting, preparing, reviewing, and producing electronic documents in a variety of criminal and civil actions and proceedings.”[2] The term used in e-discovery that describes the records being sought is “ESI” (electronically stored information). Examples of ESI may include emails, instant messages, word-processing documents, webpages, databases, photographs, sound recordings and other electronic data that may be stored in a variety of mediums. Electronic records typically encompass a much larger amount of information than paper documents and may be stored in multiple locations such as computers, hard drives, servers, smart phones, tablets, flash drives, CDs/DVDs and cloud-based third-party servers. The various forms and locations of ESI can make the information being requested difficult to produce and time consuming to retrieve.

So, what does e-discovery entail? The first step in the discovery process is the request for information or documents. Data is then reviewed by the responding party and their attorneys to determine what is relevant to the lawsuit. After determining what is relevant, these documents are placed on legal hold during the course of litigation. Documents put on legal hold are documents that are relevant and hold value and are not to be destroyed. Falsification or destruction of these records, either intentionally or inadvertently, is called spoliation. ESI is more prone to inadvertent destruction because technology enables us to delete data with a single click, which poses new challenges for companies that maintain ESI. After documents are put on legal hold, the data is then produced in a format that is easily readable by both parties and the court, typically PDF or TIFF format, although some records or data are left in their native form.

The discovery process is time consuming and can become costly if the appropriate measures are not taken to preserve electronic information and data. Today, the cost of electronically storing data is relatively inexpensive, which is one of the reasons why companies capture and retain large amounts of data. Companies may also retain large amounts of data for longer than is legally required due to the risk and penalties associated with spoliation. Companies have a tendency to “play it safe” rather than risk being penalized. However, keeping large amounts of data can also open the door for exposure of potentially embarrassing or damaging information in the event of a well written discovery request.

To reduce the potential cost of litigation, minimize legal risk and avoid spoliation of evidence, it is important to have and follow a records retention program that includes electronic records and data. Having a records retention program helps decrease the cost of discovery by keeping relevant documents that contain value for a specified period of time while disposing of documents that are irrelevant or do not hold value to the business. Those documents that do not contain value can be disposed of per the company’s records retention schedule. It is important that the records be disposed of in a consistent manner and disposal is documented so as to avoid any accusations of spoliation.

For assistance in developing your electronic records retention program, contact Zasio today.

 

[1] “discovery.” Merriam-Webster.com. 2019. https://www.merriam-webster.com/dictionary/discovery

[2] Hedges, Ronald J., Rothstein, Barbara J., and Wiggins, Elizabeth C. Managing Discovery of Electronic Information, Third Ed. (2017). https://www.fjc.gov/sites/default/files/2017/Managing_Discovery_of_Electronic_Information_3d_ed.pdf

 

Disclaimer: The purpose of this post is to provide general education on Information Governance topics. The statements are informational only and do not constitute legal advice. If you have specific questions regarding the application of the law to your business activities, you should seek the advice of your legal counsel.