E-discovery Costs And The Impact Of Social Media Cause Sleepless Nights For Many Gcs

By Author: practical2013
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General Counsel of major corporations around the world continue to worry about the costs and uncertainties surrounding preservation of electronically stored data and the impact of social media on the e-discovery process. With the volume of discovery-eligible documents skyrocketing, the complexity and cost of litigation have increased exponentially.

What’s Driving up the Cost?

There are many factors driving up the costs of litigation. First, there is the ever-changing regulatory landscape, which in turn, changes the nature and cost of compliance. In the US, corporations are struggling with an increasingly tough regulatory environment as well as oversight from a myriad of government agencies. Then there is the Responsible Corporate Officer Doctrine, which “allows corporate officers to be held criminally liable for violations ...
... of the Food, Drug, and Cosmetic Act without evidence of individual culpability based on a showing that their positions within the corporation gave them responsibility and authority to prevent or correct violations.” The potential for criminal prosecution looms over the leadership team in every major corporation. This blurring of lines between civil and criminal action increases uncertainty and risk – and is expanding the need for e-discovery.

Internationally, the reach of the FCPA, UK Bribery Act and an increasing number of anti-corruption laws in foreign countries create more layers and more discoverable information. And, on the private side, individual plaintiffs such as whistleblowers, are partnering with the US government to initiate qui tam litigation under the False Claims Act.

The complexity of defending countless Legal Process Outsourcing actions, while protecting against the unnecessary dissemination of information from one government entity to the other, is a major challenge that has grown dramatically in recent years. In light of all of these new challenges, it is not surprising that there is a need for GCs to engage outside experts to identify risks and manage potential issues, which further drives up costs.

The Impact of Social Media

Another critical issue keeping GCs up at night is the rise of New Media. What was once a print and newspaper world is now a web of social media, e-zines, and bloggers, and the world of New Media adds yet another layer of complexity to the definition of discovery-eligible and LPO data. Some GCs even see today’s form of media as a series of potential liabilities in managing the investigation and litigation landscape.

Add to this mix the prevalence of communication through social media, and GCs face a whole new dynamic in managing e-discovery.

While social media is now a mainstream communication tool, the practice of collecting and preserving it in a litigation matter is largely undeveloped. The use of social media tools such as Twitter, Facebook, and LinkedIn create collection and preservation challenges that are brand new. Reported cases involving evidence from social media are growing every year, and social channels are increasingly targeted in search warrants and government subpoenas in criminal matters. It shouldn’t be a surprise that social media is becoming a fertile ground of information to exploit in an investigation or litigation, and creating a greater risk of privacy and security breach. Companies are learning how to handle social media, just as they had to when email presented challenges over a decade ago.

It’s clear that GCs have plenty to worry about these days in e-discovery -- from tighter regulations to whistleblower complaints and social media threats. Sleep may be elusive for some time to come.

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